Modern entrepreneurial discussions and especially within product management circles one hears about network effects. Meaning that the value of a product/service which increases exponentially the more nodes (people or whatever) are part of that network.
So, for example if there were only 3 people on facebook and then a 4th joined. That fourth has the potential to find more value in the system than each of the existing members could obtain before the new addition (everyone now has 3 people to connect with rather than the original 2 each) AND the new person creates more value for the existing members (one more person with whom each can connect).
Most people would agree that for certain types of interactions, in person has value over remote. Not going to cover that debate here…I know there are many people who believe we can be equally or even more effective collaborating 100% virtually. Due to limitations on existing technologies and the current cultural dynamics of human relationships, I am not one of them.
So, let’s consider this network effect in the context of office environments. As stated above, I am going to assume there is some marginal value to being co-located. Because the value is derived from the connections, as with the Facebook example, it grows exponentially with the number of people interacting. Conversely, if you remove only a few people from the “network” because they are staying home more or completely, the overall value goes down significantly…..just from losing a few people!
What if we lose whole departments or a large portion of the people? Half the people does not mean half the value, it means 1/4 or less of the value.
In a scenario where on any given day, the office has less co-locators, those remaining in-office workers are feeling less value derived from being co-located. Now they are wondering why they make the commute, etc… and are likely to drop off also….leaving the whole network in a downward spiral towards a skeleton crew of people who derive value from the office environment unrelated to co-location with their co-workers. (Maybe more peaceful than home, especially with no other workers there). 🙂
I know that office managers and corporate leaders are thinking about this dynamic, but as with many exponentially oriented curves (like Moore’s law) it seems to me that humans struggle to perceive the trajectory of that curve traced by value on one axis and proportion of the office on the other.
In the chart to the left, I have defined total “value” as 1 for each person in the office and 1 for each connection they could make to another person in the office. I know that there are also combos of people beyond 1-1 connections (most meetings), but that will only increase the network effect and this is enough to make the point.
How do you think this effect will impact your return to the workplace? Are you considering specific days for certain depts? Is that a large enough network to create enough value for the commute? Don’t underestimate the network effect!
Future Business 