Author Archives: henrykotula

How companies are shifting their office spend to lure reluctant workers back

Posted on by • Posted in Collaboration Destination, Employee Experience, Employee Flexibility, Employee Satisfaction, Off-Site Strategy, Recruiting, Remote-First Approach, Talent Management, Virtual Office, Virtual Work, Virtual Workforce • Leave a comment

https://www.cnbc.com/2022/06/04/how-companies-are-shifting-their-office-spend-to-lure-workers-back.html?fbclid=IwAR1FNeRFjdYvlJFWR7cFWRVmT4UTSHf06J3QmTLpLHBbO12o5XlCPnwDZwM

KEY POINTS

  • As companies navigate having both in-office and at-home workers, the role of the traditional office is being reconsidered.
  • Having less people in an office every day could mean cutting space, but those spaces need to better suit the workforce of today, executives say.
  • How that experience evolves could be the difference between workers coming back to the office smoothly or leaving their jobs.

As companies and workers continue to try to figure out where and how work will take place in a hybrid environment, the costs being spent on existing office spaces previously built around the 9-to-5, five-day workweek are being closely examined.

Flexibility has become the buzzword for both sides of the employee-employer power dynamic. Workers have been leveraging the empowerment gains they’ve made amid the pandemic and a tight labor market to maintain the personal time that has come with working from home. Companies, many fearful of eroding culture that could increase turnover as well as stifling innovation by having a mostly remote workforce, have tried to meet workers somewhere in the middle by gently prodding, not pushing, workers back to the office.

The question becomes then, how does that impact budgeting and spending on typically costly workspaces when a large portion of your workforce won’t be there every day, if it all? Is there an opportunity to cut costs, or do those spaces now require additional investment to try to draw workers who are at home back into the office?

Scott Dussault, the CFO of HR tech company Workhuman and himself a pandemic-era hire, is seeing the change firsthand.

“I always quote Larry Fink’s [2022] letter [to CEOs] where he said no relationship has been changed more by the pandemic than the one between employer and employee; that’s never going to change and we’re never going back,” Dussault, a member of the CNBC CFO Council, said. “The concept of 9-to-5 in the office five days a week is gone – the keyword is going to be flexibility.”

For many companies that means retrofitting offices to meet this new normal and employee demands, while also investing in other tools to make sure connections are still being made efficiently – efforts that could mean spending more money even if square footage or leases are adjusted.

“I’m not so sure it’s going to be a cost negative,” Dussault said. “I’m not sure if people are going to take less real estate; they’re just going to change the way that real estate works.”

Workhuman is currently coming towards the end of its lease in its Boston-area headquarters, and Dussault said the company is considering expanding its space, which would provide a “clean slate” to adjust to this new working environment.

He recalled his time at a job in the 1990s where it was a “football field of cubicles” – the kind of situation where you could “go to work and sit in a cube all day and never interact with anybody – you truly could lose that connection.”

Dussault said he sees the office becoming what he calls a “collaboration destination,” part of a hybrid environment where while you might work from home on days where you’re catching up on work or emails, the office can serve as a space that is “all about connection.”

“You’re going to see a lot more open spaces, collaboration spaces, conference rooms, meeting rooms, break areas where people can sit and get together,” he said. “It’s going be focused on connection which I think frankly is positive and it is evolution – it’s going to be about making those connections more meaningful.”

That would mean investing more in things like a gym, where employees could take a physical break, or other spaces that would provide a place to take an emotional break or meditate, Dussault said, something he said results in costs shifting “from one bucket to another.”

“We need to understand and recognize that when employees are home and productive, they have those things, and we need to try to make sure that those things exist in the office as well,” he said.

That also puts a further onus on the investment in digital tools, because there still needs to be ways for workers to connect with peers even when they’re not in person.

“Companies always talk about how important employees are and how employees are the most important investment – they haven’t always acted that way,” he said. “This is a good thing that’s come out of the pandemic.”

Neal Narayani, chief people officer at fintech company Brex, noted that in 2019 the company had people coming into offices five days a week in San Francisco, New York, Vancouver, and Salt Lake City. At that time, “nobody worked from home, because it was seen as a negative,” Narayani said. But as the pandemic forced employees to work from home, where they successfully took on several large projects, that view shifted.

“We recognized very quickly that we were able to actually work more productively and faster, and that video collaboration is a very productive tool when you don’t have to commute somewhere to search the office for a conference room,” he said.

With a belief that a remote-first approach was the future of work, Brex leaned in. Of the company’s more than 1,200 employees, 45% are fully remote. The company still maintains those four office location hubs where workers can go if they want, but the company has altered its approach so that every process is designed for remote workers.

That also changed the thinking that went into those spaces as Brex planned out its growth.

“When you unwind the real estate costs, we were able to look at how many people would come into an office if we were to make it fully optional, and it was about 10%,” Narayani said. “So, we were able to move into a 10%, maybe even less, real estate option, and then take the rest of those dollars and repurpose that towards travel, towards talent development, towards diversity and inclusion efforts, and towards anything else that makes the employee experience better.”

“It turns out to be a much better experience for us because that real estate cost was very high, and those markets are very expensive,” he added.

Roughly a third of the cost of the company’s previous real estate strategy has been put into the company’s new off-site strategy, Narayani said, with other portions of that being used to pay for the four office spaces and other co-working spaces.

Larry Gadea, CEO of workplace technology company Envoy, said that he thinks many companies are looking at ways they can reduce costs right now, with office space spending as one area potentially ripe for cuts.

However, Gadea warns that “people need to be together with each other, they need to know each other.”

“They need to have a sense of purpose that’s unified, and you need to bring people together for that,” he said. “How are you going to bring people together when they’re all around the country? I think that there is a substantial amount of people thinking they’re going to be saving money on real estate, but United and other airlines and Hilton and other hotels are getting it instead.”

Gadea said that as companies try to manage a tight labor environment as well as other market challenges, more time needs to be spent on “thinking about how to bring teams together.”

“The number one reason that most people stick with a company is that they love the people they work with,” he said. “It can be a lot harder to love those people if you don’t ever see them because they turned off their video on Zoom or if they don’t even know them at all.”

SEC may take ‘fresh look’ at auditor conflicts of interest: Gensler

Posted on by • Posted in Auditing Standards, Conflicts of Interest, e Public Company Accounting Oversight Board (PCAOB), Independence, Independent Audits, Sarbanes Oxley Act (SOX), Securities and Exchange Commission (SEC) • Leave a comment
https://www.cfodive.com/news/sec-fresh-look-auditor-conflicts-of-interest-gensler/628378/?utm_source=Sailthru&utm_medium=email&utm_campaign=Issue:%202022-07-29%20CFO%20Dive%20%5Bissue:43457%5D&utm_term=CFO%20Dive
SEC Chair Gary Gensler.

Dive Brief:

  • Securities and Exchange Commission (SEC) Chair Gary Gensler has asked the Public Company Accounting Oversight Board (PCAOB) Chair Erica Williams to consider adding auditor independence standards to its agenda and the SEC itself may need to take a “fresh look” at its own rules on the independence issue, Gensler said during a webinar Wednesday.
  • SEC staff has seen “situations of decreased vigilance” when it comes to auditor independence and Gensler expressed concern that conflicts of interest stemming from auditors and affiliated firms serving the same client persist 20 years after the Sarbanes Oxley Act directed the SEC to take steps to create stronger barriers between auditors and other parts of their firms, he said.
  • “A number of firms spun out their consulting businesses in the days shortly before and after Sarbanes-Oxley. Over the past 20 years, however, many of these firms went on to rebuild them again. PCAOB inspections continue to identify independence — and lack of professional skepticism — as perennial problem areas,” Gensler said.

Dive Insight:

Gensler spoke during a webinar hosted by the Center for Audit Quality commemorating the 20th anniversary Sarbanes-Oxley Act, which established the PCAOB in the wake of the Enron and WorldCom accounting scandals to oversee accounting firms that audit public companies.

The SEC chair has been shaking up the oversight of auditors for some time, ousting William Duhnke as PCAOB chair last year. Last fall SEC Acting Chief Accountant Paul Munter underscored the importance of independent audits as an investor safeguard, saying that an auditor that provides extensive non-audit services to an entity that has an active mergers and acquisitions business model must continually monitor the impacts of all such transitions on its audit engagement to ensure that the auditor remains independent of all of its audit clients. 

During the talk Gensler was also critical of the sluggish pace at which PCAOB has undertaken the responsibility that it was given to update interim standards that it inherited from the American Institute of Certified Public Accountants.

“Historically … the PCAOB has been too slow to update auditing standards. Twenty years later, most of those interim standards remain,” Gensler said. But he expressed confidence that Williams, who took over as chair of the U.S. audit watchdog in January, and the board would “live up to Congress’s original vision with respect to standard-setting. I hope we can make some progress before Sarbanes-Oxley can legally drink.” 

In May the PCAOB announced plans to update almost all of the remaining interim standards.

San Francisco, New York state call monkeypox an emergency: 5 updates

Posted on by • Posted in Infectious Virus, Monkeypox, Public Health, Public Health Crisis, Public Health Emergency (PHE), Vaccination, Vaccine, World Health Organization (WHO) • Leave a comment
https://www.beckershospitalreview.com/public-health/san-francisco-new-york-state-call-monkeypox-an-emergency-5-updates.html?utm_medium=email&utm_content=newsletter

New York state declared an imminent threat and San Francisco issued a state of emergency over monkeypox July 28 as the virus continues to spread in the U.S., NBC News reported. 

The news comes after the World Health Organization declared monkeypox a global emergency July 23 and as the CDC reported 4,907 confirmed cases nationwide as of July 28. California and New York account for more than 40 percent of the reported cases in the U.S., according to The Washington Post.

In a statement, New York State Commissioner of Health Mary Bassett, MD, said the declaration allows local health departments “to access additional state reimbursement, after other federal and state funding sources are maximized, to protect all New Yorkers and ultimately limit the spread of monkeypox in our communities.” It covers monkeypox prevention response and activities from June 1 through the end of the year. 

In San Francisco, the monkeypox public health emergency takes effect Aug. 1, city officials said in a news release. The release, from Mayor London Breed and the San Francisco Department of Public Health, said the declaration “will mobilize city resources, accelerate emergency planning, streamline staffing, coordinate agencies across the city, allow for future reimbursement by the state and federal governments and raise awareness throughout San Francisco about [monkeypox].”

Four other updates: 

1. HHS announced July 28 that nearly 800,000 additional monkeypox vaccine doses will be available for distribution to states and jurisdictions. The 786,000 additional doses are on top of the more than 300,000 doses already distributed. This means the U.S. has secured a total of about 1.1 million doses “that will be in the hands of those who need them in the next several weeks,” HHS Secretary Xavier Becerra said during a July 28 news conference. The additional doses will be allocated based on the total population of at-risk people and the number of new cases in each jurisdiction. “This strategy ensures that jurisdictions have the doses needed to complete the second dose of this two-dose vaccine regimen for those who have been vaccinated over the past month,” HHS said in a news release. 

2. As of the morning of July 29, the U.S. has held off on declaring a national monkeypox emergency. Mr. Becerra said July 28 that HHS “continue[s] to monitor the response throughout the country on monkeypox” and will weigh any decision regarding a public health emergency declaration based on the response.

3. The monkeypox response is straining public health workers. Health experts are concerned over how the monkeypox response will further deplete the nation’s public health workforce, still strained and burnt out from the ongoing COVID-19 pandemic. Barriers to testing, treatment and vaccine access largely mirror the missteps in the early coronavirus response, Megan Ranney, MD, emergency physician and academic dean of  Brown University School of Public Health in Providence, R.I, told The Washington Post. “I can’t help but wonder if part of the delay is that our public health workforce is so burned out,” she said. “Everyone who’s available to work on epidemiology or contract tracing is already doing it for COVID-19.” 

4. Monkeypox testing demand is low, commercial laboratories told CNN. In recent weeks, five major commercial laboratories have begun monkeypox testing, giving the nation capacity to conduct 80,000 tests per week. While Mayo Clinic Laboratories can process 1,000 samples a week, it’s received just 45 specimens from physicians since it began monkeypox testing July 11, according to the July 28 CNN report. “Without testing, you’re flying blind,” William Morice, MD, PhD, president of Mayo’s lab and chair of the board of directors at the American Clinical Laboratory Association, told the news outlet. “The biggest concern is that you’re not going to identify cases and [monkeypox] could become an endemic illness in this country. That’s something we really have to worry about.”

Critics say Mark Cuban’s pharmacy isn’t tackling the big issue: brand-name drugs

Posted on by • Posted in Deferred Healthcare, Health Policy, High Deductible Health Plans, High Drug Prices, Out of Pocket Expenses, Pharmaceutical Industry, Profit Margin, Profit Model, Profit Motive • Leave a comment
https://www.beckershospitalreview.com/pharmacy/critics-say-mark-cuban-s-pharmacy-isn-t-tackling-the-big-issue-brand-name-drugs.html?utm_medium=email&utm_content=newsletter

Mark Cuban’s pharmacy, Cost Plus Drug Co., has hundreds of drugs marked at discounted prices, but some pharmacy experts say there’s a larger problem that needs fixing, CNBC reported July 28. 

The online pharmacy launched in January with about 100 drugs, and by its one-year anniversary, plans to have more than 1,500 medications, according to the company’s website. The business model, which allocates for a $3 pharmacy dispensing fee, $5 shipping fee and a 15 percent profit margin with each order, aims to uproot the pharmaceutical industry, which has faced criticism for years about its opaque business practices. 

Gabriel Levitt, the president of PharmacyChecker, a company that monitors the cheapest drug prices, told CNBC there’s more to be done.

“As much as I support the venture, what they’re doing does not address the big elephant in the room,” Mr. Levitt said. “It’s really brand-name drugs that are increasing in price every year and forcing millions of Americans to cut back on medications or not take them at all.”

Brand-name drugs are 80 percent to 85 percent more expensive than generics since brand-name drugs have to repeat clinical tests to prove efficacy, according to the FDA. Cost Plus Drug Co. only offers generics. Mr. Cuban told CNBC he hopes to sell brand-name medications “within six months,” but added that it’s a tentative timeline.