Your Place or Mine?

Telecommuting can produce real savings, but employees are now reluctant to cut the cord. Should companies do it for them?

As a CFO in these still uncertain economic times, imagine saving $3,000 per employee per year. And lopping $71 million off your real estate bill. Oh, and how about a 4 to 12 percent boost in employee productivity?

Sound good? Those are some figures thrown around by advocates of telecommuting, or, as some prefer to call it, teleworking. While the numbers may be optimistic, they do suggest that working from home isn’t just good for commute-weary employees but for employers as well. But properly equipping a remote employee is more complicated than you might think, as is deciding whether the investment truly pays off. More vexing still may be the issue of who should take the lead in pushing for—or pushing back on—work-from-home arrangements.

Not everyone agrees on just what constitutes a teleworker. The International Telework Association & Council defines one as an employee who works at home, at a client’s office, in a satellite office or telework center, or on the road at least one day per month. Even restricting the definition to an employee who works from home at least one day a month, there are 23.5 million teleworkers in the United States. Using research firm IDC’s more-conservative standard of three or more days per month yields a population of 8.7 million telecommuters.

However these workers are defined, their numbers are increasing, at least by some measures (as with the total population, growth rates vary depending on how teleworker is defined). To be effective from home, they typically rely on a computer, often a laptop that travels back and forth from home to office; an Internet connection, preferably broadband and not dial-up; a telephone; maybe a fax machine; and, increasingly, a growing range of corporate-based software applications that can be accessed from home.

Also close at hand, of course, are family members, pets, and maybe the plumber, coming sometime between 10 and noon. With distractions, obligations, and temptations in abundance, productivity is bound to suffer. Isn’t it?

Not necessarily. Most corporations with large numbers of teleworkers report productivity increases, not declines. “A number of companies fear their workers will be at home with their feet up in front of the TV, and that’s just not the case,” says IDC analyst Merle Sandler. “You can put measures in place to see if employees are actually producing what they are expected to produce.”

Four companies that employ large numbers of teleworkers—Cigna, Hewlett-Packard, AT&T, and Sun Microsystems—report both jumps in productivity and savings on office space. In the current fiscal year, Sun reported a $71 million reduction in, or avoidance of, office-space expense due to teleworking, according to Eric Richert, vice president of the company’s iWork Solutions Group, in Newark, California. At AT&T, telework director Joseph Roitz reports that the extra hour of work gained each day by telecommuters last year translated into a $148 million operational benefit. And Cigna’s 6,000 “E-workers” delivered 4 to 12 percent more output than office workers doing similar work, not to mention the $3,000 per employee the company saved on reduced office space, according to Lynne Kelley-Lewicki, Cigna’s team leader in charge of integrated work strategies.

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