Of course he will sacrifice his 5 reports to feel more important so he communicates up the chain that it's absolutely vital that they return to the office. 5 guys will commute for a combined 50 hours per week so that 1 guy who doesn't do anything can keep his job.
"Efficiency".
In Dell's case, I can only speculate, but they need to justify office space, and managers need to manage people, and most of leadership get promoted from middle management (or sales).
Worthless levity injection attack: my client supplied Dell windows machine still hiccups on cold boots sometimes (this ticket has been open for decades), while all my personal linux machines just keep chugging away. Find a company that is automating away management layers and uses linux.
This is not something I've ever heard of. Some websearching produced this article. - is it describing the concept?
https://www.mckinsey.com/capabilities/strategy-and-corporate...
>can't have f2f meetings all day
i have zoom 1:1 meetings all day with managers. going remote doesn't obviate the need for team planning and management. bottom line is commercial real estate (CRE) is screwed and the sole driver of all of this. if a behemoth like dell, amazon, etc can go fully remote and still be profitable, then what does that say for any smaller company? and then what does that do to all of the CRE holdings of said behemoths?
tough situation and it may not resolve in our favor
as a former business owner (good exit, so no bitterness here) all i can say is good riddance, and i hope they take a massive haircut as an industry.
they're the biggest pricks i've ever dealt with in running my business. 'arrogant' doesn't even begin to describe the attitude they had in the 2015-2020 time period. and they are literally no fun at parties. even the front desk receptionists were arrogant, WHILE I WAS LITERALLY HANDING THEM CHECKS. mind blowing.
example in another industry - think of all the restaurants you've ever loved that have had to close their doors because of asshole corporate landlords, for no other reason than to avoid setting a precedent for lower rents even when it wasn't financially necessary.
https://finance.yahoo.com/quote/dei
look at that beautiful, beautiful drop. it brings a tear to my eye. a tear of joy.
I agree with your virtiol, but this isn't quite correct.
You can tack "missing" rent onto the end of your financial agreement without penalty. "Lower" rent causes a reevaluation of the financial agreement basis which will almost always require a cash outlay. This is what is causing commercial real estate to be empty for 5+ years rather than lower the damn rent.
Municipalities need to implement an (in?)occupancy tax to stomp this crap out. If real estate isn't generating rent for 12+ months, tax needs to start going up on the space.
My guess is that it is not well-defined and therefore generates minimal revenue. I also can't tell if this applies to office buildings or is more for street level commercial real estate.
While we seem to be on a backswing a bit from it, eventually supporting WFH will be a matter of competitive survival. Office mandates will be the next hallmark of legacy firms who have become inefficient and wasteful in their spending.
The question is whether that competitive advantage will outweigh the incumbency advantage of the massive current players in various industries.
Sure, the small fry ABC IT Consultings of the world might get their lunch eaten by sharp new outfits that don't have to foot the cost of a floor full of downtown offices, but a behemoth like Dell, particularly one that has already been paying those costs as long as they've existed and has them built right into their structures, isn't going to be nearly so easy to dislodge.
This is one of the huge downsides of allowing so much consolidation across the board for decades. The incumbent players become much more resistant to disruption through changes like this—it will take a huge percentage of us, the tech workers, firmly saying "no, we will not accept on-site-only jobs anymore," to make a real difference.
this is not limited to tech
Tech just happens to be a place where almost every job can, with appropriate management and support, be done fully remotely with no meaningful loss of productivity.
This only applies to companies with large real estate portfolios that play real estate as a side hustle. If you mostly rent, just don't renew your lease. If you're an office space REIT, it's gonna be brutal.
I've seen several people point to this narrative on HN and it just doesn't make any sense. There's three possibilities as I see it:
1) There's some secret cabal of people who run the world and they've decided that commercial real estate needs to thrive, for some reason. So these overlords go to their puppets running major companies like Microsoft, Amazon and Dell and tell them they must make their workers return to the office in the name of propping up commercial real estate. Apparently some people on HN think this is likely?
2) The managers at Dell/Amazon/etc. feel the need to prop up commercial real estate as an act of charity. Rather than focusing on their own businesses, they are worried about their friends in commercial real estate. This seems even less likely than 1.
3) Managers at major companies believe that there are benefits to working together in person.
Why are people so reluctant to accept option 3? You don't even need to accept the premise that working from the office is better. You just need to accept that premise that management believes it's better to be a proponent of this option.
The reason is easy to figure out: "Holding a lot of Commercial Real Estate assets". There's literally trillions of dollars at stake here. I would personally propose that the alternative that the people holding this trillions of dollars of assets are just sitting back and watching their entire market collapse placidly, with it never occurring to them to call in favors, use political power, buy lobbyists, buy PR, and literally everything else possible to save that money, is the crazy idea.
It requires me to believe that the 0.001% are just so amazingly honest and fair-minded that they will calmly accept the judgment of the market that their assets are no longer required. This is not a position I see a lot of evidence for.
The only thing that surprises me is that we haven't seen a lot of call for some sort of regulation that accidentally whoopsydoopsy can only be conformed to by workers in offices whoknew what a surprise and shocking unexpected consequence. Keep an ear out for it, I wouldn't be surprised to see this tried in the next year or two. Their situation is pretty dire.
It hasn't even been all that secret either: https://www.forbes.com/sites/jackkelly/2022/02/17/new-york-c... I'm not citing that as proof, just evidence. There's plenty of money at stake in this matter.
4) Some companies have a significant amount of capital tied up in CRE. Preventing its value from going to from $X to $0 is valuable to the tune of $X. There is no apparent cost to the C-suite in enforcing RTO. So for no cost, you can save $X. It's simple, non-complex, and tied to obvious incentives.
I'm as much of a WFH proponent as the next guy but blaming CRE on the latest return-to-office movement is some crazy conspiracy theory stuff.
You would think...
Dell is a subsidiary to "Dell Capital" who's portfolio also boasts at least a 10B stake in real estate. (Primarily CRE) https://www.prnewswire.com/news-releases/bdt--company-and-ms...
However, who are Dell's the main shareholders? Do they have any vested interest in commercial real estate? Are they associated in other ventures with people who have a vested interest in commercial real estate?
I suspect that alongside the obvious reasons (inflexible management styles, micromanagement, etc.) always discussed, this is a major driver: ongoing spend on office buildings needs to be justified, and is probably very difficult to get out of - e.g. long-term building projects, or ownership of buildings which would be difficult (or a big loss) to resell, or long-term leases signed when obviously the offices would be needed for decades, or senior leaders feeling personally invested in particular building projects, etc.
About the only bit of this I buy to some extent is very senior managers who've been closely involved in building out new office space only to find it's empty.
There's no need for a "conspiracy theory" to explain it. The better way to look at it is:
Some VP at Dell leased X million sqft of office space on a long term lease that does not expire until the year 2030 (thereby getting a good deal and locking in a lower rent until that time) sometime before the pandemic flipped things to "WFH".
Now, post pandemic, with most employees in WFH status, Dell, the company, is paying $Y million/month for X million sqft of office space, which is going unused -- and they can't get out of their 2030 leases early without taking an even bigger loss. So from Dell executive's viewpoint's, this is office rent going to waste, so if it is going to be paid for anyway, we might as well force employees back to the office so we don't have to report the rental costs as pure losses on our quarterly reports to the SEC.
Literally news from yesterday: Three compies conpired to impersonate millions of voters to influence federal policy
How many times do companies have to conspire to commit fraud before people stop claiming conspiracy and corporate fraud never happens??
If they sell it and take a massive loss, they'll take a big hit on the balance sheet. So, they want to hang on to it until times are better. But, people will criticize the company for hanging onto unused real estate if nobody shows up. So now the company wants to show people in the office.
I'm not sure that this is true, but it's the only realistic way I can see CRE holdings driving returns to the office
No surprise JPM leading the charge on draconian RTO measures, given their CRE exposure..
I suspect that JPM is telling the truth about their internal productivity numbers being better in the RTO scenario, but I also suspect that these numbers are based on "doing things the way they were always done" and don't take into account scenarios with a JPM that is structured differently for WFH scenarios (e.g. reducing middle management and its proclivity for in-person meetings).
JPM is a huge lender in the space.
If CRE falls, JPM has a tougher time than the average big bank. They are also building a huge tower on Park Ave that was started pre-COVID and still not done.
https://www.marketwatch.com/story/deutsche-bank-goldman-and-...
I don't know about that. In my admittedly limited experience as an EM of 4 ICs, I'm drowning in work, mostly because they all do great work and are now double and sometimes triple booked on projects because we haven't been allowed to hire anyone. It's more than a full time job to keep a small team supported and I don't remotely feel like I'm obsolete because the company could chose to WFH.
I've personally noticed, since we've been back in office, it's been easier for those ICs to have conversations with other people in the company that they need to work with, as well as have informal brainstorming sessions with each other. This is great for me, because simply being a conduit of information between other people isn't the most efficient use of my time, so I don't really feel threatened by that. All of them have told me they've actually appreciated the hybrid schedule and the time in office for some of the week, and some of them told me that when I was a peer IC (before being their manager).
Our work is definitely more experimental/R&D/unproven though. Frequent communication, collaboration, and brainstorming is critical for success. If you're doing the kind of work where you can sit down today and create a year's worth of feature tickets then maybe it skews in favor of the office being more of a distraction.
> Of course he will sacrifice his 5 reports to feel more important so he communicates up the chain that it's absolutely vital that they return to the office. 5 guys will commute for a combined 50 hours per week so that 1 guy who doesn't do anything can keep his job.
I don't get the impression anyone at the executive level of a BigCo is collecting feedback from low level managers about whether they should RTO or not. And even in the Bay Area, 2 hours a day of commuting is on the extreme end. Everyone on my team has a total of a 1 hour commute or less, and in my case that includes a day care drop off and pick up. Personally speaking, my commute wouldn't change even if we were 100% WFH because my home and the office are equidistant from day care.
We do have a peer IC who has a long commute though and it's not great for him. I do wish there was more flexibility on a case-by-case basis to tweak the number of days he's in the office.
Most communication norms aren't tied to the physical location, it's just easier to communicate communication norms when conversations are visible to the people not involved.
I was on two projects during covid WFH. The digital collaboration styles were night and day. One's mattermost team still has less than 50 messages total across all channels. The other team's mattermost was and remains a major collaboration point now that we're back on site. One team always had cameras on during calls, the other didn't. And wasn't just chat, just calls or just emails. The communication was different on every medium.
There was a lot of the same people on both projects, too. We all adapted to different collaboration styles depending on the project. The only difference was that project management made a few gentile pushes to enable fluid communication at the beginning of one project, and the other team didin't.
And I've noticed something similar with younger people. They're much more interactive in discord chat/calls than the slack/mattermost/zoom/chime equivalents. Not that this is necessarily unique to young people, just that older people tend not to lurk discord as much. What might be unique to that age group is they've been taught corporate tools mean bifurcated groups (e.g. teacher/pupil) where they're not equal participants.