Why a $3 billion software company is betting on a future of flexible work – ‘we’re focusing on the carrot, not the stick’

Even the CEO of an artificial intelligence company sees the appeal of in-person work – sometimes.

Sarah Franklin, who joined people management platform Lattice in January after 15 years at Salesforce, is leading the company forward with a fully agile approach. (Her arrival came two years after the company closed a Series F financing round, which tripled its valuation to $3 billion).

That flexible working is the only way forward is not just Franklin’s personal opinion; this is crucial to the success of her company. Some estimates suggest that Lattice’s valuation will reach $48 billion by 2028, a sixteen-fold increase, thanks to rampant digitalization and distributed work.

Every company, no matter where it is located or how committed it is to legacy ways of collaborating and hiring, “has an opportunity right now to invest in systems that allow you to intentionally create talent density where you want it to be,” Franklin said. Fortune.

For the most part, that means ditching office mandates, which Franklin, like many future-focused CEOs, supports because of well-established evidence that it works for everyone. “The data is quite clear that mandates do not increase productivity; At Lattice, we focus on the carrot, not the stick,” he says. The company is hybrid because it believes almost all companies will be like that in the future.

Perhaps unsurprisingly, Franklin’s approach somewhat mirrors that of her former boss and longtime mentor, Marc Benioff. The magnanimous head of the $260 billion SaaS company has long maintained that a certain amount of flexibility – and giving employees choice in dictating policy – separates him from many of his stubbornly pro-office counterparts.

“I am a remote worker. I have always worked remotely my whole life. I don’t do well in the office,” Benioff said in September. “It just doesn’t fit my personality. I can’t say why. However, I love visiting clients. I’m on the road, constantly visiting clients.”

Benioff wants to make sure his employees don’t feel “forced out,” he said, because that will lead to employees leaving and “we don’t want to lose our stars.” Still, the company requires some days of in-person work because even Benioff admits that fully remote workers who haven’t received adequate on-the-job training can fall behind. (Admittedly, Salesforce employees themselves have mixed feelings. As a bargaining chip, the company at one point began offering charitable donations of $10 for each day of an employee’s personal work).

Still, Benioff and Franklin agree that what works is productivity, not control. “We’re focused on efficiency and how well we perform as a company,” Franklin said of Lattice’s distributed work plan. “There is no one size fits all. We have implemented hybrid technology with great success because it allows people to choose when to come, and we see the seriousness of this problem.” She also said that she sees the importance of useful and substantive days at the office, as long as they are not superfluous.

“We don’t focus on collecting ID scans; it’s about assessing and motivating performance and helping people do great in their careers,” he says. “Let me tell you an anecdote: we have seen first-hand data showing a dramatic decline in overall employee engagement. I truly believe that many of the stick tactics used in these mandates rob people of their sense of being an adult, professional and wanting to do their job.”

Franklin insists that executives should not serve as corridor monitors. “Focus on how to drive engagement, not on offering a bunch of benefits that don’t make sense,” he says. Instead, focus on opportunities to gain skills, teach and provide innovative career paths. “It’s about employee success, not snacks in the break room,” he says. “Ask people if they feel proactive and empowered to do great work.”

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