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Telecommuting Helps Companies Recruit

Hewlett-Packard may suffer from bringing employees back to the office

Ted Balaker
June 20, 2006

Companies often complain when factors beyond their control make it harder to attract top-notch talent, so it's surprising to find a company that shrinks its labor pool on its own. Yet Hewlett Packard did just that when it recently announced plans to yank nearly all of its IT-division staffers back into the office. By going against the trend toward increased telecommuting, the famously innovative company may end up dulling its reputation.

Companies rely on sharp employees to help them out-innovate the competition and that's why more are allowing their staff to personalize the process of work. No surprise that employees have discovered that they like the extra flexibility. A recent MONEY magazine/Salary.com survey found that workers with the most telecommuting and flexible work options were also the most satisfied.

Since HP's IT staffers have already tasted freedom, how many of the reportedly 1,000 affected employees will stick with the company if it means being tethered to a conventional office? One employee told the Mercury News that she doesn't want to uproot her family and head cross-country to her newly designated California office. "I like my flexibility," she says. "The only reason I've stayed with HP this long is because I've been telecommuting."

Even if this is a move to shed expensive employees, it could hurt HP's future recruiting efforts. When it comes to recruiting, telecommuting-friendly companies can be extra choosy because they enjoy the geography advantage. As long as a job can be done remotely, these companies can select from a huge labor pool�most anyone; anywhere with a broadband connection could be a potential employee. But labor pools shrink when bosses demand on-site work. They can only hire those who can get to the office in a reasonable amount of time and often outside factors exacerbate geographical restraints.

Take traffic congestion. We might regard congestion as merely a mundane irritant, but it becomes much more than irritating when it drains companies of talent. Long commutes can just be a matter of traveling long distances, but as congestion worsens fewer employees are willing to surrender the time, money, and sanity that battling gridlock requires. Additional factors conspire with congestion to constrict labor pools even more. Employees might be able to avoid an awful commute if they can live closer to work, but often housing sticker shock makes workers retreat to distant suburbs. The one-two punch of housing and congestion really stings in Silicon Valley, where HP is headquartered.

Recently, a survey asked Silicon Valley CEOs to rank their top business headaches: high housing costs came in first and traffic congestion second. The good news is that HP has offices in different areas, so it's not necessary for all of the recently office-bound employees to move to the company's headquarters. This geographic variety certainly helps, but it's still no where near the level of location flexibility that employees previously enjoyed. And, although few places come close to the Bay Area's shockingly high housing costs (median home price $733,000), mounting congestion is shrinking labor pools in every major metro area.

The HP exec behind the telecommuting reversal argues that remote work makes it harder for new employees to learn from veterans. Indeed the lack face-to-face human contact is a very real drawback to telecommuting, one that often prompts management gurus to fret about that venerated corporate concept�synergy.

Sure spontaneous brainstorming and water-cooler socializing can generate synergy. But consider the company that demands on-site work and has to settle for somewhat less talented employees. Will more synergy be generated from two second-rate employees sharing the same pot of coffee or from two first-raters separated by a thousand miles of earth?

Bosses who insist that workers aren't really working unless they're at work forget that different people reach their "aha!" moments at different times of day and in different environments. Two years ago an HP mechanical-design engineer explained that he works from his backyard, while sitting in a lounge chair. If he hit a creative block, he'd just stop working for a while. "Not everyone can be innovative in a very structured, 9-to-5 type office environment," he said.

To many managers' ears that sounds like the kind of hippy-dippy talk that prompts them to dismiss telecommuters as slackers. But the HP engineer offered a different take: at home "you stop watching the clock. It now becomes more of a focus on getting the task done." Since telecommuters aren't clock-punchers, they know will be judged on results and this is one reason they often work longer and more productively than office workers.

HP's telecommuting reversal reportedly shocked employees and human resources experts who recognize that more companies are beginning to get over their longstanding aversion to remote work. And HP's decision is even more unexpected because the company has long pioneered flexible work arrangements.

Almost four-decades ago, Hewlett-Packard co-founder David Packard wrote: "To my mind, flextime is the essence of respect for and trust in people. It says that we both appreciate that our people have busy personal lives and that we trust them to devise, with their supervisor and work group, a schedule that is personally convenient yet fair to others."

Packard recognized that flexibility benefits employers and employees alike and his words should remind companies that telecommuting is not an all-or-nothing choice, but a spectrum of choices. Some people thrive on the buzz of the office, while others prefer the comfort of home. Many function best with a personalized mix of at-home and office work, which is why Sun Microsystems allows for a wide range of telecommuting frequency.

When it comes to what we do, we've all benefited from the personalization of work.

It was only a couple hundred years ago when roughly 90 percent of Americans worked on the farm. Since then the variety of jobs has exploded (The Occupational Outlook Handbook lists hundreds of types of jobs and each splinters into countless subcategories). As people became better able to match their interests to their jobs, work became more fulfilling and specialization fueled innovation. We've made great progress in personalizing what we do, but now it's time to take the next step and personalize how we do it.

Ted Balaker is a policy analyst and the Jacobs Fellow at Reason Foundation. He is author of the study The Quiet Success: Telecommuting's Impact on Transportation and Beyond. An archive of Balaker's research and commentary is here, and Reason's telecommuting and transportation research and commentary is here.


Ted Balaker is Producer


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