In February 2021, Spotify announced its new work model called “Work From Anywhere.” The policy lets employees determine how often they work from the office and where they work, as long as the company has an operation there. The audio streaming service also changed how it sets salary bands, calibrating them by country instead of city or region—a benefit surely appreciated by employees, around 6% of whom moved after the policy’s instatement. There are a number of positive outcomes we can review now, around one year later.
More than a year later, Spotify says it’s experienced lower turnover compared to pre–pandemic levels and increased diverse representation. Spotify credits these changes to its return–to–office initiative. What’s more, the music streaming service says its location flexibility has helped the company meet their objectives, with roughly half of new hires coming from a location outside of Spotify’s main hubs in New York City and Los Angeles.
“People want that flexibility and that freedom,”
Katrina Berg, Spotify’s chief human resources officer, tells Fortune in an interview. Berg and her team have spent the last year tracking how the new work model affects creativity, collaboration, and productivity, the latter of which is measured by the quality and speed of completed projects. Spotify’s Work from Anywhere initiative was conceived pre–pandemic. In early 2020, Spotify’s leadership team gathered in New York City and set a goal to become a fully–distributed company by 2025. The pandemic sent office workers home, ushering in the work–from–home experiment faster than expected. “A clear common thread throughout our surveys the past couple of years, before we put this Work From Anywhere together, has been asking for flexibility,” says Anna Lundstrom, an HR VP and one of the two architects of the Work From Anywhere policy. “We also wanted to be able to tap into even broader and more diverse talent pools than we were currently tapping into,” she adds, citing heightened competition for talent and a need for teams that reflect the company`s diverse customer base.
Before the policy`s rollout, Spotify created an exhaustive FAQ document and used it as a framework for internal planning, starting with the most important questions employees would likely want answered. The HR team then created a roughly 40–page playbook for the rollout of Work From Anywhere, and later released a slimmed–down Q&A document for employees.
Spotify’s Model in detail and why they are doing it right.
About 150 of Spotify`s 6,500 global employees chose to move to a different country, representing 2% of the company`s total workforce. “We saw a lot of people had a tendency to move back closer to family,” Berg says. “We also saw a green wave; people wanted to go away from the bigger cities and live closer to nature or have a different type of life.” The company has shortened its time to hire since rolling out Work From Anywhere, dropping from 48 days to 42 days, a huge benefit for the growing organization in a tight labor market. Berg asserts that energy—which she defines as moments of spontaneous collaboration and idea sharing—combined with flexibility and trust, help boost mental health and well–being among employees, as well as inclusion. Many executives are struggling to create a return–to–work framework and corresponding office attendance policies. Companies that set strict guidelines tend to experience employee pushback or, worse, increased turnover as dissatisfied workers depart for employers that offer more flexibility. Berg says strict office attendance requirements indicate a lack of trust, which may be a sign of a flawed culture.
