How to Get Real About Measuring to Outcomes

What matters more at the end of the workday: actual results, or all of the sensory cues from people actively scurrying about?

That’s the essential question that lies behind the gap in the adoption of flexible work practices such as working from home or choosing your own hours. Too often, when CEOs say they need people to return to the office to strengthen “culture,” what they are really looking for are the visible signs of hustle culture: showing up early, staying late, being part of the bustle of busy hallways. Some of those same CEOs enacting return-to-office (RTO) mandates cite the need to get knowledge workers back to the office in fairness to front-line workers — never mind that front-line workers want some independence as well, more often in the form of schedule control.

The reality is that pairing up workplace flexibility with a deep focus on results-based management can demonstrably boost bottom-line results for businesses and improve the lives of workers, research has found. A reduction in unwanted attrition and stress levels and an increase in productivity create a high potential for a win-win for both workers and their employers.

Eric Severson has had a front-row seat to this tug-of-war for two decades. As chief people officer (CPO) at Neiman Marcus Group (NMG) from 2019 through 2024, and CPO at Davita and co-chief HR officer at Gap Inc. earlier in his career, he’s seen the tremendous benefits that giving people autonomy and focusing on measurable outcomes can create. He has also experienced the resistance and backsliding to old ways of working that are more comfortable for many leaders.

According to banker Nik Johnston at J.P. Morgan, when high-end fashion retailer NMG was acquired in December 2024 by Saks Global, it was at a remarkable 9.7 times the EBITDA multiple — significantly higher than the 5.9 multiple of rival Nordstrom’s in an acquisition expected to close later this year. The premium price wasn’t about the company’s luxury positioning, according to Severson. Rather, NMG’s secret weapon was a long-standing results-focused, flexible work culture that drove unprecedented stability and performance in an industry known for high turnover.

As NMG’s CEO, Geoffroy van Raemdonck, told me, “We wanted a culture of accountability and results. We gave employees more flexibility and empowerment and, in return, got much higher engagement and higher performance. We were after transformation, not just business as usual. Our ways of working unlocked the potential in people and were the key driver of our strong financial performance.”

The Power of Letting Go to Gain Control

Traditional management often conflates presence with performance, rewarding employees who put in face time even when their results lag. At NMG, Severson and his team took another route. Starting in 2019, they implemented what they called the NMG Way of Working (WOW), a framework built on a simple premise: Give people more choice over when, where, and how they work in exchange for accountability for results. Opportunities for autonomy extended from executives in the corporate office to salespeople in the stores.

“We wanted to get the best out of our corporate associates,” Severson told me. “But we also needed to address the needs of operations associates, and we knew there were strong business benefits to reducing turnover rates in the front-line roles of store associates.” Attrition can typically be as high as 75% or greater in retail sales and support positions. Turnover was never that high at NMG, Severson said, but he knew that there was room for improvement. “Reducing unwanted attrition would lead to lower overall costs and higher sales,” he said.

The impact of the NMG | WOW initiative was wide-reaching:

• Retention rates grew and were consistently above 75% in stores year over year, substantially above the industry average.
• Retention in supply chain roles in 2024 was 78% — almost the inverse of the industry average.
• Time-to-hire for front-line associates was reduced by double digits year-over-year once working for NMG became known as a highly attractive opportunity.
• NMG was able to expand its talent pool beyond expensive headquarters locations in Dallas and New York City, thanks to the company’s work-from-home options — which contributed meaningfully to the above results.

Severson also noted that “among corporate associates, unwanted director-level attrition was virtually zero for four consecutive quarters leading up to the sale.”

This wasn’t a pandemic pivot or experiment. It was a battle-tested strategy that built on what Severson had first pioneered at Gap in 2009. Severson initially tried every conventional approach to improve work-life balance to reduce staff churn and improve retention, especially of female employees. New collaboration tools, a companywide laptop purchase program, even flexible scheduling contracts: Nothing moved the needle on burnout or retention, he said.

The breakthrough came from emulating a program Best Buy had started a few years earlier called Results-Only Work Environment (ROWE), which gave staff members more control over their work schedules in exchange for meeting established goals. When Severson borrowed the idea and had Gap pilot a similar program in its Gap Outlet division, the results were stunning. Turnover dropped 50% within six months, Severson said. Engagement scores jumped 10 points. And there was no negative impact on sales or margins.

At Gap, proving to senior leaders that the program worked and didn’t result in people cheating the system was an essential part of the initial pilot. The financial team was enlisted as a pilot partner and tracked every element of productivity, costs, and benefits. It was a substantial challenge to the company’s culture and leadership mindset. “Some leaders instinctively believed that you had to reward people who put in the hours, even if some of them were poor performers in other aspects of their jobs,” Severson told me. “Those leaders ultimately admitted they passed employees along, as long as they showed up.”

When Severson brought the same idea to NMG, it revolutionized store operations. By focusing on results such as sales per hour and annual client sales per associate, stores could better reward front-line workers for performance. In return, store managers worked with associates to enable schedule flexibility and shift-swapping. Associates had more control over which stores and departments they worked in, as well as what days and hours they worked. NMG invested in tools that enabled store managers to tackle tasks like scheduling, floor-move planning, and talent planning from home. Associates, too, were given tools to manage customer relationships from their homes. NMG made 90% of retail positions full-time; the gains in performance more than made up for the costs of employing so many people full-time instead of hourly.

Making It Work: A Framework for Success

There was a handshake agreement NMG had with employees for providing what Severson described as “total freedom about when, where, and how you do your work.” That agreement meant that, in return for the opportunity to work where they felt they were most effective, employees’ managers had “the right to hold you totally accountable for results,” he said.

“At Gap, we got rid of performance reviews in 2013 and replaced them with structured quarterly goal setting that we tracked,” Severson said. “Every three months, you’re checking in: ‘How am I doing against my goals?’” When he got to NMG, he worked with leadership to implement the same policies and processes.

Severson’s take on the big-picture lesson from his 20 years of experience: Leaders can implement a results-based work environment effectively for any type of job. He sees three fundamental tactics for leaders and their organizations.

Reinvent performance management. Instead of implementing annual performance reviews, which often are a one-way conversation, managers should have quarterly check-ins focused on progress against individual and team goals, as well as professional development goals. This can take a sizable amount of effort: At NMG, leaders had to drive to very clear, prioritized goals, and managers had to be trained to link those goals to individual performance. Managers also had to be willing to have hard conversations with underperformers.

NMG tracked these check-ins systematically, ensuring that accountability flowed both ways. Managers couldn’t simply raise the bars arbitrarily, and employees couldn’t hide behind a lack of clear deliverables.

Monitor a richer set of business and people metrics. Leaders should track people metrics, such as engagement scores, retention rates, and time-to-hire, alongside traditional business KPIs. At NMG, this dashboard approach helped leadership spot potential issues early, particularly around workload and burnout, leading to proactive interventions before problems affected business performance. Tracking a wider variety of metrics, Severson said, makes it possible for leadership to identify trends and connect the dots.

Invest in enablers and build guardrails. For front-line workers to get flexibility in their work schedules, organizations need to invest in ways to manage this new kind of autonomy. They also need to invest in the means for some tasks, like training and customer support, to be done by employees from home instead of at the office or, in a retail company’s case, in stores. NMG did all of those things. It also reduced its office space by 400,000 square feet and reinvested the savings in a new headquarters designed to better support collaboration for employees — with fewer individual workstations and more multifunctional spaces.

For corporate staff members spread out across time zones, NMG established core hours for everyone to follow (such as 9 a.m. to 5 p.m. U.S. Central time), which created structure and supported boundaries. “Most of the time, having meetings all hours of the day or night is not necessary at all,” Severson said. “It’s just a lack of planning and discipline on the part of people who have power and authority and don’t care about other people’s lives.”

To Convince Skeptics, Keep Highlighting the Business Case

The results of the work Severson led at Gap and NMG, as well as academic research conducted at Best Buy and Gap, point to the advantages of a results-driven, flexible approach. Good people stay put, which means substantial reductions in unwanted attrition. NMG saw sizable improvements in the productivity of its operations employees and a record number of “million-dollar” associates (those responsible for $1 million in sales a year), even in a luxury market downturn. On the corporate side, earnings per employee continually increased, and employee net promoter scores increased 34 percentage points from 2020 to 2022. Studies also point to benefits such as decreased stress and higher well-being for employees who have a degree of control over their work lives.

NMG ended up significantly increasing its internal promotions over external hires, as the freedom to take initiative allowed people to show their capabilities. This benefited the company economically: It was far cheaper to promote existing staff members than it was to find new people and spend months getting them up to speed.

Perhaps most telling is what happened during NMG’s recent acquisition. While most companies bleed talent between signing a deal and its close, NMG’s retention during that period in 2024 actually increased. People had good jobs and a solid work-life balance, and they understood how they drove results.

The headlines are full of stories of CEOs and other leaders instituting more inflexible ways of working — including, most recently, Michael Dell and the current U.S. president, who is demanding a return to the office. The same thing happened at Best Buy: About a decade after it launched its revolutionary ROWE program, the effort was famously canceled when a new CEO came in. Research from back in 2010 shows that ambivalence to these types of programs is higher among men and especially those in higher-level positions, a phenomenon driven by the entrenched norms that come from their own experiences. The old way of work is how they got successful, so it must be the best way.

NMG CEO van Raemdonck told me that current RTO drives are often tied to a desire by leaders to monitor people because they haven’t put in place the systems of accountability that NMG has. But he’s seen what can happen with creative solutions. “The biggest benefit we got was the pride people feel — and that translated to economic results,” he said.

NMG’s experience offers a blueprint for success: Trust your people, measure what matters, and create systems that support both autonomy and responsibility. In a world where talent is a business’s most precious resource, the ability to attract and retain the best people isn’t just a nice-to-have. It’s a crucial driver of business value. Just ask NMG’s investors.

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