The new term phygital is a blend of PHYsical + diGITAL. It defines a user experience in the physical world through digital technologies, making it possible to improve employees’ experiences both at the office and in workspaces at home.

Today’s definition of a workplace has been disrupted since the acceleration of work digitalization and the drop in office occupancy due to the COVID-19 pandemic. The line between physical and remote presence has become more seamless than ever.

This new agile way of working requires a smart combination of digital tools, a deep cultural shift, new skills acquisition and employee engagement. Organizations all around the world now face the same challenge: maintaining the momentum of the new ways of working while remaining flexible and financially competitive.

Prior to the pandemic, the workplace was mostly synonymous with physical presence at the office and remote work was occasionally granted as an exception when staff needed it. Two years ago, a mere 19.8 percent of employees in Luxembourg worked from home "from time to time" (less than one day a week) [1]. Since the pandemic, about two thirds - 69% - of all employees have switched to teleworking [2], pinpointing the rapid shift of the market and adaptation towards a new office configuration.

This phygital disruption brought new demands to the organization’s agenda: on one hand, an empowered employee experience focused on building strong accountability, a self-starting mindset and global trust. On the other hand, the challenge for employers has been to remodel and repurpose office spaces.


Strengthening the social and cultural fabric

This digital mindset must be evident across the workforce and at the heart of the organization in order to succeed in these times of continuing and extraordinary technological advances. It is imperative to accompany and empower staff and leaders to take the leap of development, creativity, agility encompassing today’s capabilities, future essential skills and technologies. Most importantly, the culture of skills-shaping and upskilling is fundamental for employees to embrace new tools and agile ways of working.

Employee experience is at the center of this new environment more than ever before, which is genuinely human-centric. It is fundamental to bring to life a sense of shared purpose and belonging by building a culture of trust and self-mastery.

Leaders are now expected to engage staff in innovative ways where digital and face-to-face communications are complementary rather than substituting each other. Setting clear outcome-based goals is the new normal as past micro-management drifts are no longer possible in the phygital workplace. Additionally, endless communication possibilities will encourage talents to share ideas, teams to collaborate smoothly, and staff to remain connected anywhere.


Implementing digital tools tailored for the end-users

The primary objective of the new workplace is to blend physical presence and remote work to form a seamless organization without constraints and barriers.

There are plenty of technologies that can support a wide variety of mixed remote and physical working strategies, each suitable for different business models and stages of remote working implementation.


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Organizations will need to increase their efforts to improve the user experience for employees. Security and data protection must be taken into account for touchy areas (e.g. contracts, pay slips, GDPR etc.).

Forward-looking organizations are encouraged to shift more activities online and go paperless, all the while keeping in mind the legal framework in Luxembourg.

By providing a digital infrastructure and the best user experience for staff and clients, organizations will be able to function successfully in the new phygital era. Moreover, digitalization will result in effective work experiences at home or at the office, enabling a higher productivity rate, a faster flow of information and limitless collaboration.


The future phygital workplace: the foundations are built now

Reshaping the office has emerged since the pandemic and this trend will grow faster as teleworking will be increasingly used by organizations. The demand to fit the ever-growing staff concentration that Luxembourg’s real estate market faced a decade ago may decline as office occupancy has decreased since the pandemic. Organizations are optimizing their costs by going for smaller offices or satellite shared offices in profit of a digital strategy investment. 

To go beyond, the phygital workplace will contain predictive patterns to support this blended home and workplace integration – e.g. automatically syncing the following day’s alert if a meeting is cancelled the night before or implementing a virtual assistant compatible on every device. At the office, there will be smart desks and beacons which remember each employee profile, and the usage of virtual reality for remote events.


Do you know how to make your workplace phygital ready? If you have any questions or would like additional advice, please contact us.


Communicated by KPMG. This article was originally published on


[1] Source : Rapport STATEC « Travail et Cohésion sociale » 15/10/2019

[2] Source : Communiqué de presse STATEC « Le télétravail explose : une expérience jugée positive par la majorité des travailleurs » 15/05/2020

Publié le 12 avril 2021