Can we make the four-day week work?by
A four-day working week may offer benefits including improved staff wellbeing and reduced energy costs, but companies need to carefully consider the other effects of shifting their workplace culture.
When considering a new job, it long was the case that the salary was negotiable, but everything else was one-size-fits-all for employees. Where you work, your hours of work, the number of holidays you could take and how much sick leave you were allocated were all set in stone. Today this has all changed, thanks to remote and hybrid working becoming commonplace and a draw card for top talent.
This evolution of the workplace has opened the gates for another apparent immutable to be negotiated: the five-day working week. This has become a key non-salary-related lever that can be adjusted to attract and retain good people in the face of the Great Resignation and negative unemployment rates.
Success and sustainability
A four-day week is now being trialled at a range of companies in several countries around the world, including the UK, with varying degrees of success and sustainability.
It is worth pointing out that a four-day week is not intended to be a compressed work week, where you do your typical number of hours in four days, rather than five. And it does not mean getting paid less for working fewer days. Typically, the trials being run today follow a 100/80/100 model where employees receive 100% of their pay for working 80% of the time in exchange for 100% of their five-day week productivity level.
Welcome to Utopia?
The arguments in favour of a four-day week are, on the face of it, compelling, if perhaps altruistic. As people reassess the role of work in their lives, four-day weeks promise increased work-life balance with more time for leisure activities, life admin and errands, and rest and recovery before the next working week. This increasingly rested workforce is less stressed, happier, more productive and healthier, with fewer sick days taken. Trials have also shown that a reduced working week results in increased job satisfaction and company loyalty.
Beyond individual employees, and similar to remote or hybrid working, a four-day week can reduce office energy use and other operating costs, as well as contribute to a reduced carbon footprint and less traffic congestion. All of this ticks a lot of boxes and makes me wonder why we have not done this years ago.
On the other hand, several of the recent trials referenced have not been extended. Reasons for returning to a five-day status quo included customer satisfaction being negatively impacted, and additional staff needing to be hired to fill in the gaps – driving costs up. So it is clear that four-day weeks are not an automatic ticket to Utopia and certainly don’t suit all industries or even all roles within some industries.
The naysayers’ view
For argument’s sake, let’s swap hats and look at the 100/80/100 model from the perspective of the naysayers, easily pigeonholed as conservative and resistant to change. From this point of view, we need to somehow square the four-day week productivity circle. On the one hand, we’ve got the desire to improve employee work-life balance, and on the other, there is the need to run a business profitably and sustainably.
The productivity conundrum
Let’s look at the numbers. The 100/80/100 model is implying that employees are currently being unproductive for 25% of their time. This makes it sound like these businesses are running far short of optimal productivity. Given the rough two years we’ve just experienced, if the workforce is suggesting this is the case, management may well feel more than a little aggrieved.
But let’s carry on. The proposition is that employees will work 20% less for the same salaries, if they can match their five-day output in four days. One has to ask, is this level of work sustainable? It feels a bit pie-in-the-sky to think these productivity gains will just come. As it is, in one four-day week trial, 72% of participants said they needed to work longer hours to get all their work done – somewhat nullifying the work-life balance and reduced stress benefits that the four-day week promised.
It is probably realistic to assume that we will revert to current productivity levels, in due course. How then are we going to achieve 100% productivity in the long term? The only answer lies in technology or increased headcount, and that will depend on the industry, but both will mean increased costs.
What about revenue?
Then, if we assume that productivity correlates with revenue, a 20% drop in productivity will result in a 20% drop in revenue. Yet at the same time businesses are required to continue paying 100% of the salary cost. In other words, the business needs to generate 25% more revenue just to stand still. Without increased productivity, this can only be achieved through price increases. Failing that, we will start to see an increase in business closures.
The naysayers might be onto something after all.
Another factor to consider is your customer. Presumably they are expecting you to be there when they need you, five days a week. If their account manager is only working four days what happens on the fifth? Customers will understand if an account manager is off sick or on annual leave. But they are unlikely to be too happy about them being permanently unavailable one day a week. And having two account managers per customer is neither effective nor efficient.
Do we need better directions to Utopia?
It certainly seems that a four-day week needs to be carefully considered, the actual numbers crunched, and appropriate changes made to how we work to have any hope of success – you don’t just flick a switch overnight. Further, I don’t think there is a one-size-fits-all model: for instance, many of the trials seem to have all employees working on the same four days, when surely a staggered approach would be more practical, maintain service levels and reduce office overheads.
And there is no doubt that a key driver of the success of the four-day week is correctly implemented technology and changes in how we work to fully realise the benefits of this technology. Using automation to speed up manual processes, chatbots (that actually answer your question) to fill in gaps in customer service, or artificial intelligence and machine learning to speed up data analysis and decision-making are some of the advances that will unlock the success of the four-day week.
We are certainly due a reset in how we structure the working week. It was a century ago that we moved from six days to five. But, as with remote and hybrid working, the devil is in the detail and companies need to think carefully about how they shift their workplace culture, the processes and support structures they need to put in place, and the technology needed to maintain, and increase, productivity sustainably.
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Kevin is the founder and CEO of idu Software. He has degrees in Commerce and Accounting, and started idu with partners James Smith and Wayne Claassen in 1998. Kevin is fast becoming a thought leader in his field, and makes regular comment in the media about current affairs affecting business...