When Susan Trainer started her own public-relations firm nine years ago, she decided to eschew a fancy office on a fashionable boulevard. The choice wasn’t so much about money as it was about creating a geographically distributed workforce that could respond quickly and effectively to changes in the marketplace. ”There is a huge benefit to letting folks work out of their homes and creating an organization that’s able to adapt without delay,” she says. “It is a winning situation for everyone.”
Today, Trainer employs 13 individuals scattered across the United States, all of whom have medical benefits and a 401(k) retirement plan. Using phones, e-mail, instant messaging, Web-based applications and a secure company network, they handle projects for an array of clients. Trainer gets everyone together only a half dozen or so times each year and evaluates workers on the basis of their performance. “My employees are motivated and they produce solid results. I would never consider a traditional office environment,” she explains.
More and more employers, like Trainer, are bidding adieu to office buildings and cubicles. They’re turning to telecommuting, independent contractors and outsourcing to create a distributed workplace that competes more effectively and at a lower cost. Today, more than 40 million U.S. workers spend at least part of their week in a home office, according to the International Telework Association & Council, a Silver Springs, Md., organization that tracks telework trends. According to a 2003 survey conducted by The Dieringer Research Group, the number of employed Americans who work from home during business hours at least one day per month has increased by nearly 40 percent since 2001.
Going with the flow
And, unlike the early days of telecommuting, it isn’t only large companies that are tapping into the movement. Even mom-and-pop operations are sending workers home to work.
For example, Paul Hyde, principal at Concord, Calif.-based IT services firm DataMatrix, has four employees who connect to company servers from home or on the road and use cell phones to receive text messages and phone calls. They come into the office only to pick up parts, view reports and grab their paycheck. Once a week Hyde holds a company meeting. “Some face-to-face communication is essential,” he says. The approach has helped DataMatrix push billable time to 70 percent. Without the technology and remote workers, the figure would be more like 50 percent, according to Hyde.
“The traditional work structure and work day is undergoing radical change,” observes John Challenger, CEO of Challenger, Gray & Christmas, a Chicago outplacement firm. “Technology is leading to enormous change. We have unlocked a 24x7 labor market that is not constrained by geographic boundaries.” In fact, Challenger believes that the conventional office space and 9-to-5 workday might not even represent the ideal working environment. “Alternative work situations are becoming the rule rather than the exception,” he notes.
Jane Paradiso, a national leader for workforce planning at human-resources consulting firm Watson Wyatt Worldwide, says that, in many cases, employers find themselves responding to social and economic factors beyond their control. While a company can save money with less office space to rent and furnish, organizations increasingly find that they are competing for top prospects. “In many cases, the most talented and desirable workers are not willing to relocate—especially with high real-estate prices in California, and the New York and Washington, D.C. metropolitan areas.”
It’s a fact that isn’t lost on Martin Babinec, CEO of TriNet Group Inc., an online payroll benefits and support firm based in San Francisco. He visits his company’s headquarters only two or three times per month, usually for a few days at a time. The rest of the month he works out of his home office in upstate New York or while on the road. Using a cell phone, notebook PC with wireless capabilities, videoconferencing and other tools, he is able to connect instantly and seamlessly to enterprise data and others in the organization. “There is no longer any reason to have everyone in the same physical location,” he states.
Others are taking the concept to new heights. JetBlue Airways now operates a virtual call center for its 760 reservations agents. All work from their own homes using a company-issued PC, a phone line and an Internet connection. The approach nets the Forest Hills, N.Y.-based airline company millions of dollars in cost savings annually and allows individuals to stay in their existing community and avoid disruptive moves or time consuming and expensive commutes.
Confronting new challenges
Yet, as the distributed workforce continues to expand, employers face new challenges. Managing workers in far-flung locales requires a focus on performance and systems that can measure results. Those that turn to low-wage workers in places like India, Malaysia and the Philippines can face communication breakdowns and cultural friction. What’s more, longtime workers at these firms might perceive that they are in danger of losing their jobs to those in other countries. As a result, morale and productivity can sag.
Paradiso believes that while it’s impossible to predict how telecommuting and remote work will specifically impact jobs—and which, if any, it will make obsolete—the concept clearly requires executives, managers and employees to think and act differently. “Technology is making work more collaborative and workers more interdependent,” she says. “The vertical, bureaucratic organization of the past is less and less viable. New methods and techniques for managing a workforce are required.”
How the distributed workplace evolves over the coming years remains a question. Yet, according to Challenger, it’s a trend that isn’t going to disappear anytime soon. “There are numerous benefits—lower costs, environmental gains and an improvement in the quality of life for those who participate,” he says. “As people become more comfortable with technology, telework will further shape the business world.”
