Good morning.
Most U.S.-based companies are on track to bring their knowledge workers back to the office in September—just six weeks away. But there’s still no consensus about how the post-pandemic office will actually work. That was the topic of conversation at a virtual CEO roundtable Fortune held yesterday, in partnership with McKinsey & Co. Some excerpts here:
“The punch line for us is: I’m not sure what we’re going to do…We want to try to really experience all three again—full work from home, a hybrid environment, and fully back—and then make decisions about what the right outcome is for the company, for employees, and for customers.”
—Darius Adamczyk, CEO, Honeywell.
“We came up with this global philosophy of ‘work from wherever’—of course, we have to have two Ws—which really is going to give our employees the ability to decide how to work flexibly. But we put in some structure with that…When the leaders want to bring teams together, you are required to come in and be together.”
—Mindy Grossman, CEO, WW
“We still believe the office is the center of gravity for the company. And we’ve been really clear. Not a center of gravity. The center of gravity—for inspiration, for training, for learning for collaboration.”
—Patrice Louvet, CEO, Ralph Lauren
“We put our workers into three different categories. The first category, about 30%, will be fully virtual…And 20% will be essential, who work in security, heavy data analytics, who we found work better together. And then the rest of us—about 50%—will be hybrid…could be two to three days a week.”
—Steve Collis, CEO AmerisourceBergen
“There’s a real disconnect here. Our survey of C-suite executives would say that 75% of them are going to pursue at least a three-day week hybrid model. And when you look to what you hear from employees, you get about 50% of them wanting more than three days a week at home.”
—Liz Hilton Segel, Global Head of Industry Practices, McKinsey
“My anecdotal conversations at all different levels of the company are that people are saying, ‘I forgot how much energy I get from interacting, I forgot there was such a social aspect to work, and I’m missing a lot of stuff because every Zoom call is scheduled around a specific topic.’ We are seeing a sentiment change and that’s why we’re kind of embracing this stuff but letting the details come out over time, as things evolve and play out.”
—Geoffrey Martha, CEO, Medtronic
Many of the companies are asking people to be vaccinated before coming back to the office. But none are yet requiring vaccination as a condition of employment or asking for proof of vaccination. That could change once the FDA gives the vaccines full approval.
“Right now, we are just continuing to educate and push for vaccination. But as soon as it becomes FDA approved, it will be a condition of employment.”
—Anne Klibanski, CEO, Mass General Brigham
A couple of the CEOs mentioned tension between factory and service employees who have to show up to work every day versus office workers who can continue to work remotely.
“There are definitely tensions between the folks that have to come to work and the people that have the flexibility to stay home. No doubt about that.”
—Jim Loree, CEO, Stanley, Black and Decker
“We have 300-plus warehouses and salespeople all around the world and I am seeing through our surveys they are saying, ‘Hey, you know we’ve been back to work from day one and you folks in the corporate office are sipping lattes at home in your pajamas and it’s not fair.’ I think that is one reason why we do need to have our corporate offices feel like they’re back to work, even if we’re being more flexible, because we’re here to help the people in the field.”
—Kevin Hourican, CEO, Sysco
I need another latte. News below.
Alan Murray
@alansmurray
alan.murray@fortune.com
Olympic sponsors
The Olympics have started! Excited? Its Japanese corporate sponsors aren't; with many people in the country opposing the Games (which only the IOC had the power to cancel) in the context of the pandemic, major sponsor Toyota has scrapped its Olympic-themed ads. Like many other companies such as Fujitsu and NEC, Toyota also decided its executives would skip the opening ceremony. Fortune
Chip shortage
Intel CEO Pat Gelsinger thinks the global semiconductor shortage could stretch all the way into 2023. Gelsinger, who is on a mission to turn Intel around: "We have a long way to go yet…It just takes a long time to build [manufacturing] capacity." Wall Street Journal
Twitter rebound
Twitter beat analyst expectations with its Q2 earnings—20 cents per share rather than 7, with 74% year-on-year growth—and its share price leapt as much as 9%. The number of monetizable daily active users was up 11%. CNBC
Pandemic origins
China has rejected a WHO proposal for audits of markets and laboratories in Wuhan, the city that is believed to be the epicenter of the pandemic. Georgetown University health policy expert Mara Pillinger: "Without Chinese cooperation, WHO’s hands are tied, international hands are tied, and our ability to identify the origins of the virus will be much reduced." Washington Post
Back-to-school and back-to-college spending makes a comeback With more clarity about the upcoming school year and consumer sentiment continuing to rise, Deloitte's Back-to-School and Back-to-College survey predicts that spending will be at its highest level in recent years, reaching a collective $32.5 billion for K-12 students and $26.7 billion for college shoppers. Explore the survey
School wave?
Parents in the U.S. are anxious about sending their kids back to school in the coming weeks, and with some reason, as most are unvaccinated and their return probably will lead to a rise in COVID-19 case numbers. What's more, little more than a quarter of schoolkids are at schools with a mask mandate. Fortune
Roche and COVID-19
The Swiss healthcare giant Roche has found the pandemic to be a double-edged sword: it's made a lot of money from testing kits and its Ronapreve therapy (co-developed with Regeneron), but lockdown's dissuading effect on patients seeking treatment for other ailments has also hit Roche's pharmaceutical sales. Fortune
Port attacks
South Africa's Cape Town and Durban ports were reportedly hit by cyberattacks that disrupted container and auto-parts shipping. Commodities weren't affected, which is fortunate, because Durban's port (which was also affected by last week's riots) is the conduit for most of the copper and cobalt coming from the DRC and Zambia. Reuters
Burnout's moment
Our pandemic-induced burnout moment allows us to reconsider our relationship with work, as this excellent Wired piece explains. However, recognition of burnout is mostly afforded to those in certain occupations, with those in blue-collar jobs not having the luxury to talk about it. Wired
This edition of CEO Daily was edited by David Meyer.
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