If pandemic productivity is up, why is innovation slowing down?

A new study finds that productivity has remained stable or even increased for many companies that shifted to remote work during the coronavirus pandemic. However, innovation has taken a hit as both leaders and employees feel more distant from each other.

Person working from home, sitting at a desk with a computer, speaking on a smartphone, holding a mug.

Businesses tend to spend less money and take less risks during uncertain times, but researchers also attribute the current innovation deficit to the difficulty with collaboration that often comes with working from home. Videoconferencing and instant messaging apps can’t perfectly replicate the dynamics of being together in the same room, hashing out ideas and feeding off the energy of co-workers.

“It’s a challenge to feel connected, confident, and communicate effectively with the team, and we know from a lot of research that creativity and innovation largely happen through collaboration,” says Wharton management professor Michael Parke.

The study shows that fears about lost productivity during the pandemic are largely unfounded. Employees haven’t slacked off just because they are at home. In fact, some home comforts are helping many employees stay at the same level of productivity or reach even higher. They enjoy dressing down, having their pet nearby and personalizing a workspace they don’t have to share with nosy neighbors peeking over the cubicle.

“Employees can really focus; they can be comfortable in their own setting,” Parke says. “They’re gaining things like less commute time, not having to get ready or dressed up for work. A lot of those factors, just the comfort and casualness of working from home, came through [in the survey].”

The dip in innovation is the biggest downside to remote working, according to the survey. But Parke says there are three simple steps that managers can take to overcome this hurdle: provide access to a wide range of collaborative tools, train employees on how to work remotely, and establish a routine way of connecting with a team, and stick to it.

Read more at Knowledge@Wharton.