Back-of-envelope estimate: what remote work costs a mid-sized app maker in output

A mid-sized company that develops apps moves its employees from the office to remote work. Estimate how much productivity the company should expect to lose because of this change. Define how you measure productivity, state your assumptions and reach a number. ```hint Split the work before you estimate Remote work does not affect every activity the same way. Break the work into kinds that change differently, separate one-time effects from lasting ones, and consider whether anything partly offsets the loss. ``` ### Clarifying Questions - How should productivity be defined: output such as features shipped, revenue per employee, or effective working time valued in dollars? - How many people does "mid-sized" mean here, and roughly how is the staff split between engineering, product and design, and business roles? - What period should the estimate cover: the first year after the switch, including the transition, or the steady state once teams have adjusted? - Is the company going fully remote or hybrid, and can all of its work be done outside the office? ### What a Strong Answer Covers - A measurable definition of productivity and an explicit time horizon. - An equation that breaks the loss into drivers, such as transition effects, collaborative versus individual work, and onboarding of new hires. - Round-number assumptions, each labeled, with correct arithmetic and a final figure in both percentage and dollar terms. - A sanity check and a sensitivity range that shows which assumption drives the answer. - Awareness of offsetting gains and of confounders such as market conditions. ### Follow-up Questions - Which single assumption moves your answer the most, and how would you measure it inside the company? - Leadership is deciding whether to bring everyone back to the office. Besides your productivity estimate, what would you weigh? - Six months after the switch, how would you check your estimate against real data?