Benefits of Telecommuting

The Benefits of Telecommuting:
Why More Companies Should Rollout Telecommuting

Introduction
Two years ago I transitioned from a large digital advertising agency to a corporate marketing position. Prior to my corporate employment I worked for small digital agencies that enjoyed testing and implementing new work trends to remain competitive with other agencies. One of these trends was the ability to work from home, Starbucks, or any other location with Internet access. This is known as telecommuting. By definition, telecommuting is “an alternative way of accomplishing work tasks while at the same time providing a variety of benefits to organizations, associates, communities, and the environment” (Green, Lopez, Wysocki & Kepner, 2012, p. 1). I had grown to believe that the remainder of the working world functioned similarly and that working from home was an option in every organization. All of my responsibilities can be completed by way of email or over the Internet. This position requires extended hours, including coming into work early, leaving late, working weekends, and being accessible at all times. All the required work can be completed remotely by Internet or phone. Despite this potential, my director does not allow for her employees to work from home or elsewhere. This conclusion is not based on corporate management guidelines, employee performance, or any other rationale reason. Working from home is simply not allowed due to my director’s opinion and her inability to trust her team unless they are working from the office. Telecommuting is an option that can be exercised on a full time or part time basis, or only when an employee deems it necessary. This work practice can be accomplished from any location and “encompasses home-based work, satellite offices, and neighborhood telework centers for multiple employers, and mobile workers” (Potter, 2003, p. 75).
A majority of the fortune 1000 companies have telecommuting programs, but a majority of companies overall do not allow for this flexible work option (Potter, 2013). According to Green (2012, p. 1), telecommuting is a popular alternative associated with better quality of life and enhances job performance. This work option is gaining in popularity and is a viable alternative in the business world.
Despite the habit of many business owners and managers, like my own, to adhere to the belief that you have to be in the office to be productive, trends are moving in the other direction as the number of people who work from home has almost doubled over the past 30 years (Bloom, Liang, Roberts & Ying, 2013, p. 2). Advances in technology, such as the computer and internet, have enhanced personal and business productivity and communication, which have allowed business to be conducted from remote locations (Potter, 2013, p. 75). According to Bloom et al. (2013, p. 21), 10% of the total workforce reports working from home at least one day a week. Boardroom Executive Suites reports that in 2011 between 20 million and 30 million Americans worked from home at least one day a week. As the modern workforce continues to evolve, more companies are looking at telecommuting options to save costs and retain their top talent. When the work is amenable to telecommuting, all companies should grant employees the ability to work from home since the positives outweigh the negatives. The evidence suggests that the ability to telecommute leads to happier and more productive employees, which results in less turnover and costs for the company.

Productivity and Work Performance

Stanford University conducted a study on CTrip International Corporation, a leading Chinese travel agency, to measure the effectiveness of telecommuting. The study measured 255 call center representatives out of the Shanghai office. The call center representatives had varying work assignments focusing on either airline or hotel calls. The telecommuters in the intervention group worked from home four days a week and from the office on the fifth day. The control group continued to work five days a week from the office. The experimental intervention only changed the location of work, not the work teams, equipment, nor the working hours. Within a few weeks of the investigation launch, telecommuters were performing better than their counterparts that stayed in the office (Stillman, 2011, p.1).
The telecommuter’s performance went up by 13% over the nine-month intervention period (Bloom, Liang, Roberts, & Ying, 2013, p. 3). The improvement was directly related to the 9% increase in the number of minutes they worked during their shifts (Bloom et al., 2013, p. 3). They were able to work more hours and more days since they lost less time due to late arrivals, sick breaks, and sick days (Stillman, 2011, p.1). The remaining 4% increase was a result of increased productivity per minute worked and an increased volume of calls that could be completed per minute worked. The telecommuters were able to take more calls due to the quieter working conditions and fewer distractions than they would have experienced if they were to work from the office call center. The telecommuters were also able to work more hours since they did not lose time to late arrivals and sick breaks. The 13% performance improvement resulted in $375 worth of cost savings per employee per year (Bloom et al., 2013). A similar study was conducted by Cisco Corporation to evaluate the various social, economic and environmental effects associated with telecommuting at Cisco (Cisco, 2009). Like the study by Bloom et al. described above, this study also revealed that a majority of the participants experienced an increase in work productivity. Cisco reported being able to achieve new levels of efficiency and effectiveness by allowing employees to work no matter where they were located. A total of 69% of the employees cited higher productivity when working remotely and 75% also believed that the timeliness of their work also improved. Cisco estimates that the company was able to generate an estimated annual savings of $277 million dollars in productivity by allowing employees to telecommute. In addition, the environmental impact of telecommuting was significant. Cisco telecommuters in the United States saved an average 30 mile round trip daily while workers in Europe saved an average of 46 mile daily commutes.
In an article titled Telecommuting in the 21st Century: Benefits, Issues, and a Leadership Model Which Will Work by Gibson, Blackwell, Dominicis, & Demerath (2002) several studies were reviewed that reported increases in productivity when employees telecommuted. A Control Data Corporation reported that telecommuting leads to a 15 and 25 percent increase in productivity, while Los Angeles County reported a 37 percent increase in productivity and a 60 percent decrease in errors for data-entry clerks that telecommute. A Traveler’s Insurance company reported a 22 percent increase by its telecommuting staff and American Express also reported soaring productivity results. When telecommuters were asked why they had an increase in productivity when working from home, the most popular answers were less distractions at home than in the office, extra motivation to work as a result of the flexible schedule, and the ability to work during “peak” personal times. Telecommuters reported experiencing less stress and greater flexibility, which also led to increased productivity.

Employee Satisfaction

Employee satisfaction with their job and employer also increases when given the opportunity to telecommute. Employees in the Stanford University – CTrip International Corporation study were given two sets of surveys in order to measure satisfaction and work attitude. The satisfaction test was conducted five times throughout the experiment and reported significantly higher satisfaction once the experiment began. The self-reporting measured a 10% increase in positive attitudes toward work. The employees also reported being less exhausted from work when telecommuting, which lead to increase in job satisfaction (Bloom, Liang, Roberts & Ying, 2013, p. 13).
The Cisco study found that overall employee satisfaction increased as a result of the ability to work remotely. Employee satisfaction increased due to the reduction in time spent commuting to and from an office and an increase in work-life flexibility (Cisco, 2009, p.1).
According to a 1999 Wirthlin Worldwide Survey, telecommuters were significantly more positive in their attitudes about working than the non-telecommuting counterparts. The telecommuters expressed high job satisfaction, were more likely to recommend their company to others, and believed that their contribution were being recognized by their company (Potter, 2013, p. 78).In a 1999 Telework America National Telework Survey, it was found that 57 percent of teleworkers indicated that they were more satisfied with their jobs after starting to work at home (Potter, 2013, p. 78).

Reduction in Attrition and Absences

The ability to telecommute also has shown to lead to a reduction in attrition. According to Bloom et al. (2013, p.18), telecommuters in the intervention group in a Stanford University study were 50% less likely to leave a company than those in the control group who were required to work from the office. The resulting decrease in attrition saves companies many dollars in employee recruiting, orientation and training. According to Bloom et al., the reduction in turnover saved companies about $400 per employee per year, resulting in additional annual savings for the employer (Bloom et al., 2013, p.18). The Cisco study also revealed that telecommuting leads to a higher employee retention rate, as more than 91% of the participants reported that “telecommuting is somewhat or very important to their overall satisfaction” (Cisco, 2009, p.1).
Telecommuting is viewed as a “powerful weapon” in reducing company turnover in the study conducted by Gibson (2002, p.79 ). Turnover reduces attrition since employees are less likely to be lured to other companies for better work arrangements, flexibility or personal time. The reduction in turnover can save a company from paying up to 25% of the employee’s salary to search, hire and train a replacement. Telecommuting is also useful in reducing turnover when an employee faces child care or elderly parent care decisions. The employee won’t necessarily need to leave their job when given the opportunity to telecommute.
Telecommuters are more likely than other employees to refer to themselves as “very committed” to their employer. A total of 78 percent of telecommuters are “very committed”, while only 53 percent of non-telecommuters consider themselves to be very committed. The telecommuters were also almost twice as likely to say their company is “very committed” to them. In all, 66 percent of telecommuters believe their employer is “very committed” to them, while only 35% of non-telecommuters believe this (Potter, 2003, p. 78). As a result of these study outcomes, telecommuting can be viewed at as a “winning arrangement” for both employers and their employees. Two-thirds of those surveyed also said that having telecommuting working arrangements available to them provided an “excellent reason” to remain with their current employer” (Potter, 2003, p. 78).
Telecommuting opportunities also leads to a reduction in work absences. Instead of being absent to manage personal and family needs that would normally lead employees to be completely absent from work an average of 45.3 additional occasions, telecommuters were only absent a total of 22 work days (Potter, 2003, p. 79). Since most incidents that need to be addressed outside of work only require 2 to 4 hours to complete, the number and frequency of absences decreased. The family needs were able to be taken care of and the remainder of the day could be devoted to work in the home office (Potter, 2003, p. 79).

Conclusion

Research clearly shows that telecommuting leads to happier and more productive employees, which results in fewer turnovers for a company. The number of companies implementing telecommuting options continues to increase overall and a majority of the fortune 1000 companies allow for at least some telecommuting (Potter, 2003). Despite this trend in top companies, the majority of work places, including Yahoo, still do not allow employees this option. Computers, the Internet and wireless communications are helping organizations to change and encourage the trend of telecommuting. It is wise for all organizations to restructure in order to accommodate this inevitable and popular benefit that assures a higher quality of life during and outside of work hours. If employers understood the benefits behind telecommuting, including increased employee satisfaction, productivity and a decrease in attrition, more employers would understand the importance of implementing the practice. If companies continue to not embrace this workforce trend they stand the risk of losing top talent to organizations with more flexible work-life opportunities.