The 4 taxes that bankrupt your workday: State of Work Innovation 2024 sneak peek

Clocking in at 9 a.m. and heading out at 5 p.m. is no longer the norm. More and more knowledge workers are adopting hybrid and flexible schedules, with asynchronous workflows and cross-functional teamwork taking the place of in-person meetings and siloed knowledge. 

And yet, many companies still cling to rigid structures that don’t suit this new environment. These outdated practices create hidden “taxes” on productivity, eroding team performance—and happiness—over time. Our newest State of Work Innovation report offers findings from over 13,000 knowledge workers across six countries, backed by five years of data, and informed by insights from future-of-work specialists. The report highlights major shifts in work practices—some obvious, others not so much. 

But not to worry: We also offer a guide for forward-thinking companies to adapt and thrive. By understanding and addressing these hidden costs, you can unlock your organization’s full potential and foster a more dynamic, efficient, and pleasant work environment.

The four hidden productivity taxes

Connectivity tax: The hidden toll of disconnection

The connectivity tax is most egregious when teams operate in silos rather than as cohesive units. This disconnection can hamper the free flow of ideas and information, which is essential for innovation and agility in the workplace. 

• According to our research, only 12% of workers feel new ideas move seamlessly between departments.

• Instead, 90% rely on informal networks to navigate this communication gap. 

• Such disconnections not only affect productivity but also reduce strategic alignment. 

• When employees can’t see how their work contributes to broader company objectives, motivation wanes and efforts become misaligned. 

• Full-time office workers are 32% more likely to say they consistently feel micromanaged by their managers versus those with more flexible work arrangements.

To combat these issues, organizations need to foster a culture of connectivity and transparency, leveraging technologies that bridge communication and collaboration gaps to ensure every team member is aligned with organizational goals. In high-connectivity organizations, workers are 90% more likely to understand how their work adds value and helps achieve company objectives.

Velocity tax: The bottlenecks that slow us down

The velocity tax represents the drag on productivity caused by outdated technologies and cumbersome processes. 

• Despite advancements in digital tools, 94% of workers still depend heavily on spreadsheets.

• 64% of workers report that collaboration tools complicate rather than simplify their tasks. 

• These bottlenecks hinder the swift execution of work and decision-making, impeding organizational productivity. 

• For companies striving to be agile, aligning technology with workflow is crucial. 

High-velocity organizations excel by streamlining processes and investing in technologies that integrate seamlessly into existing systems. In organizations where information flows quickly between teams, leaders strike the right balance—adding just enough structure to keep things efficient without slowing down agility. Employees at these organizations are 3.2x more likely to say their leaders make decisions that align with the organization’s best interests.

Resilience tax: The processes that crumble under pressure and change

This tax comes down to three main issues: toxic colleagues, toxic managers, and poor change management. Each one quietly chips away at your organization’s resilience.

• Toxic colleagues: Toxic colleagues come in many forms, from “turf warriors” who are overly protective of their responsibilities to “deluded martyrs” who exaggerate their workload. If you think you’re immune, consider that 93% of workers say they experience one or more toxic colleague behaviors at work. 

• Toxic managers: What’s even scarier is that 81% of workers say they’ve witnessed toxic manager behaviors at work, from “vanishing acts”—managers who are unavailable and unresponsive when their team needs guidance—to “credit snatchers,” who take credit for their work. 

• Toxic change management: 82% of workers say they’ve encountered toxic change management practices in their organization. From hasty overhauls to criticism crackdowns, toxic change management consists of poorly handled organizational changes that have a negative effect on employees and company culture. While 42% of employees feel confident in their own ability to handle change, only 27% are confident in their organization’s ability to navigate future challenges. 

Think of it like being a talented chef in a kitchen with a faulty stove and spoiled ingredients. Unless something changes, you’ll probably start looking for a job at a different restaurant. It’s no wonder, then, that only 45% of employees are confident they’ll still be with their current organization in six months.

Meanwhile, at a high-resilience organization, workers are 116% more likely to say they can depend on their managers and 2.7x more likely to know how they fit into their organization’s future plans. Fostering adaptability, communicating clearly, and building a supportive culture that empowers employees to navigate change effectively are all critical to driving resilience.

Capacity tax: The overwhelm that depletes employees’ bandwidth

The capacity tax reflects the toll on employees’ bandwidth caused by excessive workloads, technology overload, and unproductive meetings. 

• According to our research, 44% of workers say they dread meetings. 

• The number of hours wasted in unproductive meetings has doubled since 2019, to five hours a week. That’s about an entire month wasted each year.

• Our research indicates that employees experience “Meeting Recovery Syndrome”—or the lingering effects of frustrating meetings—following 28% of their meetings. 

• This hampers workflow, lowers productivity, and leads 89% of employees to commiserate with colleagues, spreading negativity across the organization.

• Technology can be just as exhausting, with 63% of employees saying their work is disrupted by too many tools.

However, the Work Innovation Lab’s Collaborative Intelligence Lead Dr. Mark Hoffman reveals that there’s a “sweet spot” for collaboration. Organizations that can find this equilibrium see employees who are 41% more likely to engage in the right amount of collaboration. Though this balance is different at every organization, workers often achieve it by setting clear boundaries, prioritizing tasks, and using tools like Asana to streamline collaboration and avoid excessive meetings or interruptions.

Slashing your tax bill

These four taxes affect all organizations, but with varying degrees of impact. Get the full report for tips on how to: 

• Strengthen collaboration across teams to minimize the connectivity tax.

• Accelerate workflows, make smart AI investments, and invest in digital literacy to avoid the velocity tax.

• Develop strong defenses against the resilience tax.

• Tame tool bloat, cut down on excessive meetings, and clarify work ownership to tame the capacity tax.