Merits of a four day week

New technologies, such as artificial intelligence (AI) and robotics, are becoming increasingly prevalent in the workplace and have the potential to significantly boost UK output. For workers, the potential reward of this technological revolution is more freedom, more control over their time and, if many employees had their way, a four-day working week.

And it could be a great move for business. Earlier this year in a landmark experiment, a New Zealand trust, wills and estate planning firm spent two months testing a four-day working week for its employees, with no reduction in pay. The results? Sense of work-life balance for workers at Perpetual Guardian went from 54% to 78%. Stress went down. And the missed hours didn’t affect job performance, which actually slightly improved. Now they’re making the change permanent.

But it does depend on the business. An experiment at Svartedalens retirement home in Gothenburg, Sweden, last year saw employee hours reduced from eight hours a day to six, with no pay cut. While it was concluded that shorter working hours did indeed have positive benefits for employee health, happiness and productivity, it was too expensive to implement. This was mainly due to extra positions having to be created to make up for the lost working time.

Would it work in the UK where, according to research by Vouchercloud, the average British employee is productive only three hours a day? Many are convinced that it would, including Frances O’Grady, leader of the UK’s trade union movement. She claims that, with advances in technology, a four-day working week is a realistic goal for most people by the end of this century. The Labour Party recently announced that it would consider introducing a four-day week following a general election.

On the face of it, making this work requires a 20%-plus productivity gain to equal what a business can achieve in five days in just four. An obvious worry for businesses is financial loss although, as Brian Kropp, group vice president of Gartner’s HR practice, points out, trials have shown it hasn’t necessarily had a detrimental impact on worker productivity.

“With the incentive of an extra free day, distractions, such as noise and water cooler discussions, and stressrelated sick days are cut considerably,” he says. As such, businesses might not lose as much through absenteeism and drops in motivation as was previously feared.

In reality, closing down one day in five and simply reducing overhead and running costs is not that straight-forward, and can be to the detriment of the customer, says Amanda Moore, IT programme director at specialist payroll and accountancy services provider Workr Group. “No business wants to make it harder to compete with its competitors and be perceived as offering less than they do,” she says.

The financial case does become more viable with automation of physical manufacturing and, with the flexibility enabled by the internet and online services, the battle can be won.

So how are business leaders responding to the idea? As regional CEO at global customer agency C Space, Felix Koch says it isn’t a case of whether he likes the idea, but how he reacts and takes measures to stay competitive in a world where four-day weeks will be more prevalent in the war for talent.

“I don’t believe this will result in a productivity loss, but it will be a case of people having to work smarter and be more ‘laser-focused’,” he says. “We have a few young parents at C Space with family commitments who have learned to be much more precious with their time at work. The potential productivity losses will be made up by the general higher degree of job satisfaction, so the payoffs are clear.”

Not all business leaders accept the inevitability of a four-day working week. In manufacturing, the loss of one working day could impact productivity far more than a marketing company.

Jane Campbell is founder and managing director of PCL Corporatewear, a leading supplier of corporate clothing based in Tring, Hertfordshire. The company has a turnover of just over £2m. She agrees that a four-day working week is a possibility, but doesn’t believe it would be realistic for every business, or even something that everyone would want.

“We operate a 35-hour working week. We don’t expect our team to work outside their contracted hours and we provide part-time work and flexibility as far as possible. Rather than be satisfied with achieving the same amount in less time, I’d use the time available to be more productive,” Campbell says.

The company is in the process of installing a new software system to cover all operations, from receiving sales enquiries to production, invoice and despatch. This will free up team members to do the same amount of work in fewer hours. However, the plan is to use this time to better engage with customers and grow the business further.

“There are many aspects of our business that cannot be automated, which would be problematic should a four-day working week be introduced as the norm,” adds Campbell. “Our branding department is open from 8am to 8pm each day and at weekends, depending on the workload, so we have to be flexible. During busy periods, the longer we are open the better for business.”

She feels that more availability and better acceptance of flexible working patterns together with technological advances should mean greater choice for everyone, and is therefore the logical way forward.

Although a four-day working week is unlikely to work well for all jobs or industries, there are many contexts in which a reduced working week strategy could be a competitive advantage. This includes recruitment, retention, employee wellbeing and even reduced operational costs, says Amy Pytlovany, a research scientist at SAP SuccessFactors.

“Fewer commuters on the road provide an additional social benefit in terms of traffic congestion and vehicle emissions,” she says. “A reduced working week is not going to be a one-size-fits all solution, but with some creativity many organisations can find themselves benefiting from a four-day work week strategy.”

But whether it presents any financial advantages for a business will depend on its competitive environment and employee preferences, as Dr Shainaz Firfiray, associate professor at Warwick Business School, explains.

“A four-day work week could lead to an accumulation of missed deadlines and increased costs for businesses as they may need to outsource some tasks or hire additional staff to ensure work gets completed on time.

“In organisations that place excessive work demands on their employees, doing the work of five days in four days would seem an impossible task. And in client-focused businesses, introducing a four-day work week may prove to be very challenging and reduce competitiveness.”

But some industry sectors could do very well out of a shorter working week, says business and innovation expert Erica Wolfe-Murray, who has worked as a creative head and financial director of a number of companies.

“If we are going to move towards a four-day working week, it means the leisure and hospitality industry will go into overdrive to cater for all our downtime needs,” she says. “Those running experiential and education ventures will have more customers, and so will have to up the supply to meet the demand.”

Then there is the impact of a shorter working week on talent acquisition and retention, both a top priority and major concern for organisations. Considering the changing needs of next generation talent, businesses need to think about how these workers will likely adapt to such a major shift.

Millennials generally aspire to a different professional life than their predecessors. According to Gallup, 21% of millennials in 2016 reported switching jobs within the past year, compared with only 7% of generation X and other non-millennials. They are largely driven by purpose over economics and attracted to opportunities that make them feel inspired rather than having a fixed working week.

“A four-day work week won’t necessarily do it for them,” says Morten Petersen, co-founder and CEO at Worksome, a platform for independent consultants and freelancers. “Therefore companies should focus on how they can create an attractive workspace and help further their careers and goals.

“The key is flexibility and trusting that employees can decide on the schedule that allows them to perform the best.”

Communications agency McOnie has come up with a compromise that gives staff better quality time off without losing actual working hours. They work a nine day fortnight, five days one week and then four days the next, in a working pattern that has helped to increase creativity in the office.

Managing director Sarah McOnie introduced the initiative five years ago, with the aim of promoting a healthier work-life balance for her teams and boosting creativity and productivity. The new schedule has gone down well with the staff and, since its introduction, there have been no direct costs or financial implications for the business.

“This is because, in spite of having every other Friday off, in reality the teams work their contracted hours through an extended working day, which runs from 08.30 to 17.45,” she explains.

“The Friday off allows everyone to slow down and unwind, and regain their mojo after a busy week. An added benefit of the regular break is low sickness absence and improved employee physical and mental health and wellbeing.”

The financial benefit from an increase in employee motivation can be difficult to calculate but should not be underestimated, says Moore. “Most of us will work even harder and with increased focus if we know the upside is more leisure time with family and friends and more freedom to do what we want.

The bottom line is that productivity has to increase if costs do not fall, as staff will still need the same salary and are unlikely to accept earning less.”

So four-day working weeks and flexible hours can work but there has to be an equitable compromise and it can’t just be at the expense of the business. There needs to be a balance. Key to this will be education so that future generations can harness and use the technology to lead better, more fulfilling and economically sustainable lives.

“Technology is not a threat, whether it’s robotics, AI, machine learning or basic online services, it is just improving the toolkit and enabling us to achieve more with our time,” adds Moore. “Ultimately the financial benefits will flow if management teams partner with the workforce and employees take on board the need to sustain and increase productivity."

Digital agency Lab recently introduced a four-day working week for all 50 of its staff in an effort to boost creativity and productivity. So far the results have been positive – productivity has remained constant and there have been no financial implications, while staff get a bank holiday weekend feeling every week.

Founder and CEO Jonny Tooze says the initiative, which began last August, was sparked by the company’s core vision of creating a world where everyone is free to do what they love.

“We see the replacement of human workers with technology as inevitable and not necessarily a bad thing: freeing the human race of the shackles of labour,” he says. “Without a doubt it’s something that we need to get ready for, as it’s coming.”

The new system, he says, works on the premise that they shift from “pretending we were working seven-and-a-half hours a day, five days a week” to actually working nine hours a day, four days a week.

Staff can choose to take a Monday or a Friday off, but are asked to stick to their days in order to facilitate the planning of service levels for clients. As Tooze points out, this is by far the biggest concern when thinking about implementing such a change. And the shift was not without its challenges.

“Your week feels 20% busier, however, you end up cutting a lot of nonsense out of your diary and simply re-prioritising your days,” says Tooze. “Handling that new stress and taking control of your own week is pretty important.”

In terms of maintaining productivity in a shorter week, communication is by far the biggest thing. “The pressure created from a four-day week means that we need to be more precise with our communications,” he adds.

• Merits of a four day week
  Business & Management Magazine, Issue 270, December/January 2018

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