Workers and bosses alike are trying to figure out ways to reinvigorate work life. Could a cherished Swedish coffee ritual be the answer?
4 min
Would work be better if we all took a collective coffee break?
Workers in Sweden certainly think so. There, work life has long revolved around fika, a once- or twice-a-day ritual in which colleagues put away phones, laptops and any shoptalk to commune over coffee, pastries or other snacks. Swedish employees and their managers say the cultural tradition helps drive employee well-being, productivity and innovation by clearing the mind and fostering togetherness.
Now, as bosses and workers elsewhere try to reinvigorate office life and flagging job satisfaction, fika fascination is seeping into other workplaces.
The Grand, a New York-based career and leadership coaching platform, summons its all-remote staff of 10 every other Friday for coffee and conversation over Zoom. London-based Hubble, a website for finding flexible workspaces, took up the tradition after being introduced to it by a Swedish staff member.
“Everyone has an excuse to log off and let their hair down,” said Tushar Agarwal, chief executive of Hubble, where staff gather the last Thursday of every month for baked goods, chitchat and, of course, coffee.
A recent product offering—for part-time office space with new contract terms—sprang from a discussion that took place during fika, says chief of staff Charlie Bastier. It’s now one of the fastest-growing revenue streams, he says.
The pressure to make tweaks to the daily ritual is particularly acute in the U.S. Employees continue to report feeling less engaged in their jobs than in pre pandemic times, Gallup data show.
In addition, bonding with colleagues has become harder and less of a priority for many people in the hybrid world of work. Some employers worry the lack of social cohesion is harming company culture and operations.
At The Grand’s regular fika, staffers take turns hosting, leading with casual conversation or a board game such as Code Names or a drawing competition. The Grand’s co-founder Rei Wang says that fika allows her to spend time with her staff, making her a better leader.
“Learning more about their passions and their geniuses helps me understand and collaborate with them,” she says.
Pronounced “fee-kah,” the Swedish culture of breaking for coffee involves much more than a schlep to Starbucks. It’s meant to be a deliberate pause to provide space and time for people to connect. Many Swedish companies build a mandatory fika into the workday, while the Embassy of Sweden in Washington holds one for staff weekly. IKEA, promoting its Upphetta coffee maker on the corporate website, extols the virtues of fika: “When we disconnect for a short period, our productivity increases significantly.”
“Fika is where we talk life, we talk everything but work itself,” said Micael Dahlen, professor of well-being, welfare and happiness at the Stockholm School of Economics. The ritual helps drive trivsel, he says, a term that means a combination of workplace enjoyment and thriving. The concept is so fundamental to Swedish workplaces that many companies in Sweden have trivselcommittees, he said.
Dahlen said he suspects a pandemic-era drop in office fikas contributed to a sharp decline in Swedes’ happiness at work. Just over half of workers in Sweden reported a high level of job satisfaction in 2022, according to Eurostat, compared with 69.5% in 2017.
There’s some evidence that communal coffee breaks help boost productivity. In a study of call-centre workers at Bank of America, researchers at the Massachusetts Institute of Technology found that teams that scheduled 15-minute breaks together were 18% more communicative with one another through the workday than groups with staggered breaks.
Annual turnover, likewise, was 12% among teams that held collective coffee breaks versus 40% among other workers. In all, the teamwork fostered via the breaks led to an estimated $15 million in increased annual productivity, says lead researcher Ben Waber.
“People who are in a tight knit social group have higher levels of trust,” said Waber, who has since founded a behavioural analytics company called Humanyze.
Hubble employees take turns baking and get a stipend of about $20 for supplies for the company’s monthly fikas. Last week, 26 staff members gathered in a communal area away from desks and cubicles.
Kate Mehigan, an account manager, brought in homemade arancini balls and Eliot Dixon, an account team lead, laid out a Basque cheesecake from a recipe he’d found online. Some people played ping pong.
Fleur Sylvester, a Hubble account executive, used the time to quiz a colleague on training advice for running a half-marathon. Sylvester says when she joined the company over a year ago the gatherings were invaluable for helping put faces to names.
“You get an opportunity to speak to other team members that you don’t get to talk to on a day-to-day basis,” Sylvester said. “When you’re online you don’t get the opportunity to have those chats.”
Peter Linder, head of thought leadership in North America for Swedish telecom giant Ericsson, recently introduced the fika concept to Jason Inskeep, senior director at management consulting company Slalom. The two men had initially met on a joint panel discussion, and Linder wanted to congratulate Inskeep on his new job at Slalom. He sent Inskeep a Zoom invite for a 20-minute fika one-on-one.
“I didn’t know what it was,” Inskeep said.
The vibe of the midmorning conversation—which meandered from the future of artificial intelligence to Inskeep’s own feelings navigating a new company culture—was different from the usual business tête-à-têtehe said. Bouncing ideas back and forth in a relaxed way left him feeling energized the rest of the morning.
“It was a mix of coffee shop and barber shop,” he said.
Copyright 2020, Dow Jones & Company, Inc. All Rights Reserved Worldwide. LEARN MORE
What a quarter-million dollars gets you in the western capital.
Alexandre de Betak and his wife are focusing on their most personal project yet.
Multinationals like Starbucks and Marriott are taking a hard look at their Chinese operations—and tempering their outlooks.
4 min
For years, global companies showcased their Chinese operations as a source of robust growth. A burgeoning middle class, a stream of people moving to cities, and the creation of new services to cater to them—along with the promise of the further opening of the world’s second-largest economy—drew companies eager to tap into the action.
Then Covid hit, isolating China from much of the world. Chinese leader Xi Jinping tightened control of the economy, and U.S.-China relations hit a nadir. After decades of rapid growth, China’s economy is stuck in a rut, with increasing concerns about what will drive the next phase of its growth.
Though Chinese officials have acknowledged the sputtering economy, they have been reluctant to take more than incremental steps to reverse the trend. Making matters worse, government crackdowns on internet companies and measures to burst the country’s property bubble left households and businesses scarred.
Now, multinational companies are taking a hard look at their Chinese operations and tempering their outlooks. Marriott International narrowed its global revenue per available room growth rate to 3% to 4%, citing continued weakness in China and expectations that demand could weaken further in the third quarter. Paris-based Kering , home to brands Gucci and Saint Laurent, posted a 22% decline in sales in the Asia-Pacific region, excluding Japan, in the first half amid weaker demand in Greater China, which includes Hong Kong and Macau.
Pricing pressure and deflation were common themes in quarterly results. Starbucks , which helped build a coffee culture in China over the past 25 years, described it as one of its most notable international challenges as it posted a 14% decline in sales from that business. As Chinese consumers reconsidered whether to spend money on Starbucks lattes, competitors such as Luckin Coffee increased pressure on the Seattle company. Starbucks executives said in their quarterly earnings call that “unprecedented store expansion” by rivals and a price war hurt profits and caused “significant disruptions” to the operating environment.
Executive anxiety extends beyond consumer companies. Elevator maker Otis Worldwide saw new-equipment orders in China fall by double digits in the second quarter, forcing it to cut its outlook for growth out of Asia. CEO Judy Marks told analysts on a quarterly earnings call that prices in China were down roughly 10% year over year, and she doesn’t see the pricing pressure abating. The company is turning to productivity improvements and cost cutting to blunt the hit.
Add in the uncertainty created by deteriorating U.S.-China relations, and many investors are steering clear. The iShares MSCI China exchange-traded fund has lost half its value since March 2021. Recovery attempts have been short-lived. undefined undefined And now some of those concerns are creeping into the U.S. market. “A decade ago China exposure [for a global company] was a way to add revenue growth to our portfolio,” says Margaret Vitrano, co-manager of large-cap growth strategies at ClearBridge Investments in New York. Today, she notes, “we now want to manage the risk of the China exposure.”
Vitrano expects improvement in 2025, but cautions it will be slow. Uncertainty over who will win the U.S. presidential election and the prospect of higher tariffs pose additional risks for global companies.
For now, China is inching along at roughly 5% economic growth—down from a peak of 14% in 2007 and an average of about 8% in the 10 years before the pandemic. Chinese consumers hit by job losses and continued declines in property values are rethinking spending habits. Businesses worried about policy uncertainty are reluctant to invest and hire.
The trouble goes beyond frugal consumers. Xi is changing the economy’s growth model, relying less on the infrastructure and real estate market that fueled earlier growth. That means investing aggressively in manufacturing and exports as China looks to become more self-reliant and guard against geopolitical tensions.
The shift is hurting western multinationals, with deflationary forces amid burgeoning production capacity. “We have seen the investment community mark down expectations for these companies because they will have to change tack with lower-cost products and services,” says Joseph Quinlan, head of market strategy for the chief investment office at Merrill and Bank of America Private Bank.
Another challenge for multinationals outside of China is stiffened competition as Chinese companies innovate and expand—often with the backing of the government. Local rivals are upping the ante across sectors by building on their knowledge of local consumer preferences and the ability to produce higher-quality products.
Some global multinationals are having a hard time keeping up with homegrown innovation. Auto makers including General Motors have seen sales tumble and struggled to turn profitable as Chinese car shoppers increasingly opt for electric vehicles from BYD or NIO that are similar in price to internal-combustion-engine cars from foreign auto makers.
“China’s electric-vehicle makers have by leaps and bounds surpassed the capabilities of foreign brands who have a tie to the profit pool of internal combustible engines that they don’t want to disrupt,” says Christine Phillpotts, a fund manager for Ariel Investments’ emerging markets strategies.
Chinese companies are often faster than global rivals to market with new products or tweaks. “The cycle can be half of what it is for a global multinational with subsidiaries that need to check with headquarters, do an analysis, and then refresh,” Phillpotts says.
For many companies and investors, next year remains a question mark. Ashland CEO Guillermo Novo said in an August call with analysts that the chemical company was seeing a “big change” in China, with activity slowing and competition on pricing becoming more aggressive. The company, he said, was still trying to grasp the repercussions as it has created uncertainty in its 2025 outlook.
Few companies are giving up. Executives at big global consumer and retail companies show no signs of reducing investment, with most still describing China as a long-term growth market, says Dana Telsey, CEO of Telsey Advisory Group.
Starbucks executives described the long-term opportunity as “significant,” with higher growth and margin opportunities in the future as China’s population continues to move from rural to suburban areas. But they also noted that their approach is evolving and they are in the early stages of exploring strategic partnerships.
Walmart sold its stake in August in Chinese e-commerce giant JD.com for $3.6 billion after an eight-year noncompete agreement expired. Analysts expect it to pump the money into its own Sam’s Club and Walmart China operation, which have benefited from the trend toward trading down in China.
“The story isn’t over for the global companies,” Phillpotts says. “It just means the effort and investment will be greater to compete.”
Corrections & Amplifications
Joseph Quinlan is head of market strategy for the chief investment office at Merrill and Bank of America Private Bank. An earlier version of this article incorrectly used his old title.
