Despite considerable research, many managers remain ambivalent about introducing telecommuting as a business strategy.1 Should the strategy be aimed directly at solving business problems or be integrated into the reward structure of the organization? These and other questions persist. Although a few detailed case studies address telecommuting, analytical frameworks for examining cost/benefit issues are rare.
In this article, we describe in detail a successful telecommuting program implemented at a 150-person company that provides interactive marketing and sample-distribution services for the pharmaceutical industry. Each of the firm’s eight divisions is headed by a director or vice president who sits on the firm’s executive board. The general manager — a champion of high-tech solutions who has supported the telecommuting program since its inception — creates company policy, which the executive board members implement. The information architecture of the company consists of a mainframe, a minicomputer, and more than 200 personal computer (PC) systems linked by four file servers. Headquartered in New Jersey, the firm had also maintained sales offices in Pennsylvania and Illinois before introducing telecommuting.
In 1995, the company’s twenty-person salesforce became remote workers who relied on mobile computing equipment to conduct business. By 1998, the company had expanded its telecommuting program to support two more sales-people and fourteen part-time telecommuters in managerial and analytical positions — 24 percent of the firm’s workforce.2
The firm’s telecommuting program transformed paper-based procedures and heavy reliance on voice and in-person communications into automated procedures and full-scale connectivity. The program generated real-estate savings, increased managerial control of the field force, reduced processing errors, and improved customer service. The firm achieved greater accountability and control through automation, thereby alleviating one of management’s main concerns —how teleworkers allocate their time outside of a traditional office setting.
Of course, these benefits did not materialize without cost. The program affected salespeople, middle managers, and information systems (IS) personnel. Middle managers were concerned about their lack of experience managing a distributed workforce and their perceived loss of control over employees. Sales representatives were concerned about privacy issues and their lack of computer skills. The immediacy of the telecommuting program requirements forced IS personnel to set new priorities, delayed other aspects of their work, and meant working overtime.
Completing the initial support structures for the implementation of remote computing is the milestone that marks the beginning of steeply reduced ongoing direct costs.
1. For example, see:
M. Watad and P. Will, “Telecommuting: IT-Enabled Alternatives Work Arrangement,” in Proceedings of the 4th World Multiconference on Systemics, Cybernetics and Informatics (ISAS98), Orlando, Florida, 12–16 July 1998.
S.M. Jacobs and M. Van Sell, “Telecommuting: Issues for the IS Manager,” Information Systems Management, volume 13, Winter 1996, pp. 18–21.
B. Patterson, “Eleven Steps for Success,” Computing Canada, volume 23, 17 March 1997, p. 38.
J.M. Niles, Making Telecommuting Happen: A Guide for Telemanagers and Telecommuters (New York: Van Nostrand Reinhold, 1994).
J. Kugelmass, Telecommuting: A Manager’s Guide to Flexible Work Arrangements (Lexington, Kentucky: Lexington Books, 1995).
D. Schepp and B. Schepp, The Telecommuters Handbook. How to Earn a Living Without Going to the Office (New York: McGraw-Hill, 1995).
W. Master and W. Joice, “Reinventing Workplace: Interplay Telecommuting Centers,” The Public Manager, volume 22, Fall 1993, pp. 11–13.
R. Maynard, “The Growing Appeal of Telecommuting,” Nation’s Business, volume 82, August 1994, pp. 61–62.
G. Dutton, “Can California Change Its Corporate Culture?” Management Review, volume 83, June 1994, pp. 49–54.
N.K. Austin, “How Managers Manage Flexibility,” Working Woman, volume 19, July 1994, pp. 19–20.
J.M. Weiss, “Telecommuting Boosts Employee Output,” HR Magazine, volume 39, February 1994, pp. 51–53.
2. We use the terms “telework” and “telecommuting” interchangeably and “teleworker” to describe any employee who telecommutes full-time or part-time. Typically, a full-time telecommuting arrangement is similar to the “virtual office” concept, i.e., the employee has no traditional office at the company facilities. In the case of part-time telecommuting, the employee may not lose a physical office, but the company may save on real estate costs by implementing open space, shift work, and shared offices. For more information on these different arrangements, see:
T. Davenport and K. Pearlson, “Two Cheers for the Virtual Office,” Sloan Management Review, volume 39, Summer 1998, pp. 51–65.
A. Mahlon, “The Alternative Workplace: Changing Where and How People Work,” Harvard Business Review, volume 76, May–June 1998, pp. 121–136.
3. For more details on organizational issues that arise when an organization upgrades its information infrastructure, see:
G. Hay and R. Munoz, “Establishing an Architecture Strategy,” Information Systems Management, volume 14, Summer 1997, pp. 67–69;
J. Knowles, “Build an IT Architecture on a Business Foundation,” Datamation, volume 42, July 1996, p. 25; Jacobs and Van Sell (1996);
R. Wilkes, M. Frolick, and R. Urwiler,”Critical Issues in Developing Successful Telework Programs,” Journal of Systems Management, volume 45, July 1994, pp. 30–34;
B. Farrah and C. Dagen, “Telecommuting Policies that Work,” HR Magazine, volume 38, July 1993, pp. 64–71;
M.A. Mahmood and G.A. Mann, “Measuring the Organizational Impact of IT Investment,” Journal of Management Information Systems, volume 10, Summer 1993, pp. 97–122;
F.J. Corbato, “On Building Systems That Will Fail,” Communications of the ACM, volume 34, September 1991, pp. 72–81; and
M.J. Ginzberg, “Early Diagnosis of MIS Implementation Failure: Promising Results and Unanswered Questions,” Management Science, volume 27, April 1981, pp. 459–478.
4. K. Hildebrand, “Managing Telecommuters,” Colorado Business, volume 25, March 1998, pp. 48–49.
A. Fowler, “How To Benefit from Teleworking,” People Management, volume 2, March 1996, pp. 34–35.
5. L. Sigfrido, “Connect Business and Technology,” Datamation, volume 40, 15 November 1994, pp. 61–64.
6. IS directors must carefully monitor several issues when their organizations introduce complex IT-based projects that have strategic implications. For example, stress and burnout are major problems. Some companies hold retreats at which IS personnel engage in fun activities and team building. Furthermore, there is a tendency to reward IS personnel who can resolve crises instead of rewarding managers who keep their operations running smoothly. In general, reliability and continuity are as important as crisis handling; consequently, the reward system should be designed to reflect these values. See:
R. Sturm, “When Quality of Service, Not Crisis Management, Is the Real Standard,” Communicationsweek, 26 August 1996, p. 45.
Organizations cannot afford to lose IS personnel during an IT-enabled major organizational change. As a company’s needs change, retaining IT staff with older skills is a challenge. The cost of replacing IS professionals is much higher than retraining them. Most IS organizations designate someone to be in charge of recruiting, but usually no one is directly responsible for retention. IS managers should view successive waves of IT as evolutionary rather revolutionary and, therefore, institute continuous training programs. See:
J. Champy, “It’s Not Who You Hire, It’s Who You Keep,” Computerworld, volume 31, 29 September 1997, p. 74.
7. Training teleworkers and managers minimizes risks and ensures the success of telecommuting programs. Training should include technical and communications skills, as well as address issues related to cultural and organizational change. The organization that we studied paid little attention to corporate culture training, whereas we believe formal training in this area helps an organization handle change and reduces stress and uncertainty. See:
Jacobs and Van Sell (1996);
Hildebrand (1998); and
Not all jobs are appropriate for telecommuting. For example, see:
P. Korzeniowski, “Telecommuting: A Driving Concern,” Business Communications Review, volume 25, February 1995, pp. 45–48; and
Neither are all employees appropriate. See:
Hildebrand (1998); and
Jacobs and Van Sell (1996).
Successful telecommuters have certain general characteristics: outstanding communication skills, the ability to work well independently, and technical skills. See:
Managers of telecommuters must be effective communicators and be supportive of the telecommuting policy. See:
8. J. Ward, P. Taylor, and P. Bond, “Identification, Realisation and Measurement of IS/IT Benefits: An Empirical Study of Current Practice,” in Proceedings of the Second European Conference on IT Investment Evaluation (Henley-on-Thames, Oxfordshire, U.K.: Henley Management College, 1995).
9. For a telecommuting program to succeed, business managers need to change their focus of control from attendance monitoring to managing for results. For examples, see:
Weiss (1994); and
Logs and time sheets may indicate to managers when telecommuters are working, but the lack of visual control can be a problem when managers have not been adequately trained to focus on results. See:
Austin (1994); and
The importance of communication in performance management is emphasized in:
F.W. Campagna, “Managing Telecommuters,”Training & Development, volume 50, December, 1996, p. 9.
10. Master and Joice (1993).
11. For the importance of an appropriate corporate culture for telecommuting, see:
K. Girard, “Ditching the Commute,” Computerworld, volume 31, 1 September 1997, p. 1 and p. 16;
S. Cohen, “On Becoming Virtual,” Training & Development, volume 51, May 1997, pp. 30–32; and J. Zeidenberg, “Telecommuting: A Fiscal Phenomenon,” Computing Canada, 18 January 1996, pp. 5–6 (special issue on mobile corporate computing).
According to most authors, organizations adopt telecommuting when the corporate culture finds telecommuting suitable to its needs. As more firms institute telecommuting policies to reduce costs, they may have to change the culture of the firm to foster an acceptance of telecommuting. See:
Zeidenberg (1996); and