Myths About the Alternative Workplace

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rom

sharing desks to telecommuting more

employees

than ever

before are

workin

in n ontraditional ways and

organizations

are beginning to

reap

the benefits

THE ALTERNATIVE WORKPLACE:

CHANGING WHERE AND

HOW PEOPLE WORK

BY MAHLON APGAR; IV

^N SEPTEMBER 2O, 1994 , so m e 32 ,0 00 AT& T

employees stayed home. They weren't sick

or on strike. They were telecommuting.

Employees ranging from the CEO to phone opera-

100,000 people. It's purpose? To explore how far a

by moving the work to the w orker instead

of the worker to work.

Today AT&T is just one among many organiza-

tions pioneering the alternative workplace

(AW)

- the

combination of nontraditional work practices, set-

tings,

and locations tha t

is

beginning to supplement

traditional offices. This is not a fad. Although esti-

mates vary widely, some 30 million to 40 million

people in the United S tates are now either telecom-

mu ters or home-based workers.

What motivates managers to examine how people

spend their time at the offite and where else they

could work? The m ost obvious reason is cost reduc-

tion. Since 1991, AT&T has freed up some 550 mil

lion in cash flow -a

30%

improvement - by eliminat

ing offices people don't need, consolidating others,

and reducing related overhead

costs.

Through an AW

program called the Mobihty Initiative, IBM is saving

more than

100

million annually

in its

North Americ

sales and distribution u nit

alone.

Another reason

is

the potential

to

increase produc

tivity. Employees in the alternative workplace tend

to devote less time and energy to typical office rou-

tines and more to customers. At

IBM,

a survey of em

ployees in the Mobility Initiative revealed that 87%

beUeve that their personal productivity and effec-

tiveness on the job have increased significantly.



THE ALTERNATIVE WORKPLACE

Myths About the Alternative Workplace

Many executives and employees hold firm - but false

beliefs about the alternative workplace. These myths

m y

dissuade organizations from exploring the po

tential benefits of

W

initiatives.

The alternativ e workplace

is

for everyone. It isn t.

Some high-tech advocates promote this no tion, bu t it

is de ar th at m any people and functions today simply

are

not suited

to

the alternative workplace.

The

United

States is perhaps a generation away from the thresh-

old of broad-based computer literacy and systems

integration tha t will enable the m ajority of people to

be comfortable working outside the traditional office

if they choose to do so. Yet leading organ izations, such

as those cited in this article, have shown th at the W

concept applies to a large and growing segment of the

workforce. Ironically, in th is new paradigm, the

youngest are the m ost skilled, the oldest are the m ost

awestruck, and the m iddle-aged are the mo st resistant

to the changes in mind-set and rituals that the alter-

native workplace requires.

An AW prog ram can spearhead the process o£

organizational change. It can t. Although an

W

ini-

tiative can leverage reengineering and change-man-

agement efforts in the traditional workplace, it cannot

launch them. Certain basic improvements must be

made first specifically, simplifying the organization,

redesigning business processes, broadening access

to information, and defining corporate performance

measures . O therwise,

the

AW in it iat ive will

be

swamped by the sheer weight of these changes. Bu

once the tide of change has begun to roll, W employ-

ees can become strong advocates for extending the

initiative throu ghou t th e organ ization. After aU, they

are already self-motivated, relatively autonomous,

and results oriented. So they have the most to gain

and the least to lose from influencing their peers to

accept and adap t

to

AW work.

A company office is the mo st productive place to

work. Not necessarily. What few managers realize-

but the alternative workplace highhghts - is th at the

atmosphere and norm s of the conventional office can

distrac t people from their work. In a study of one well-

managed office, these distractions averaged 70 min-

utes in an eight-hour day. Employees in the alterna-

tive workplace are usually more productive than their

traditional counterparts because they learn how to

juggle priorities and minimize downtime by making

phone calls, writing E-mail, clearing accounts, and

performing numerous other routine tasks during the

short pockets of time between other commitments

throughout th e day. But W employees also are ham-

pered by home and office designs. Developers are just

The altern ative workplace also can give comp anies

an edge in vying for -a nd keeping talented, highly

motivated employees. American Express president

and COO Ke nne th I. Chenau lt says th at Am Ex s AW

initiatives help the company retain experienced em-

ployees who find the fiexibility to work from hom e

especially attractive.

Finally, AW prog ram s

are

beginning

to

offer

op

por tuni t i e s

to

capture go vernm ent incentives

and

avoid costly sanctions. Many communities

are

eas-

ing zoning rules

to

enable m ore residents

to

estab-

lish home offices.

In

addit ion, companies

are

meet-

ing Clean Air Act requ irem ents

and avoiding hefty

fines through regional workplace strategies with

extensive AW components. Finally, tax codes may

change to enable more employees to deduct home

office costs.

The potential benefits are clear. But at the same

t ime, AW programs

are not for

everyone. Indeed,

such programs can be difficult to adopt, even for

behaviors and practical hurdles are ha rd to ov

come. And the chal lenges of ma na g i ng bo t h t

cul tural cbanges and the s y s te ms i mprove m e

required by an

W

initiative are substantial.

How should senior managers think about A

programs? Wbat

are tbe

criteria

for

determini

wbether

tbe

alternativ e workplace

is

rigbt

fo

given organization? What

are tbe

most comm

pitfalls

in

implementation?

Tbe

lessons learn

by managers wbo bave successfully launched su

programs and by tbose wbo are struggling to do

suggest tbat tbe bes t place to start is witb a cl

understanding of tbe many forms an alternati

workplace can take .

Spectrum

o

Options

Different companies use different variations on

W

tbeme to tailor new work arrangements to tb

own needs.

To

one company, for example, establi



THE LTERN TIVE WOR KPL

beginning to include quiet, private office space and

robust electronics in new

homes.

Similarly, some new

office buildings now include efficient plug-and-play

drop-in space.

AW employees can take care of themselves.

Not

exactly. It is naive to think tha t aU one needs is a lap-

top an d a cellular phone to be effective in the a lterna-

tive workplace. Most people need coaching in the

basic protocols of

AW

life. And everyone needs direct

access to th e systems, gadgets, and technical sup por t

that enable remote work. person's ability to excel in

the alternative workplace depends on an array of new

skills in communication, navigation, and leadership

that takes time to learn and requires proactive, top-

down sup port. Informal bu t essen tial social processes

that occur spontaneously in the conventional work-

place, sucb as the brown-bag lunch and the weekly

happy hour, need to be managed in the alternative

workplace.

The altern ative workplace underm ines teamwork

and organizational cohesion. In fact, it can build

them - but in an unorthodox manner. Modern theo-

ries of teamw ork are based on traditio nal, face-to-face

models in which communication, information, and

personal chemistry are intertwined in one location

mo st or all of the time. In the alternative workplace,

som e workers on different shifts or travel sched-

shar e desks a nd office space. AT&T de term ined

ees in shared-desk ar rang em ents.

n space is ano tber o ption. In sucb arrang em ents,

at form at. As Jill M. Jam es, director

T&T's Creative W orkplace So lutions initiative,

m , You are assig ned to one facility, bu t

n mo ve aroun d and choose a variety of work

pgar W, is a counselor on real estate and infra-

these links are unlocked. Technology empowers

everyone - not just managers - wherever they are by

enabling immediate communication with teammates

and shared access to information. The chemistry

within teams also has different elements. Contribu-

tions are defined more by conten t th an by cosmetics

when the team works electronically: an objective,

egalitarian quality that often is missing in the conven-

tional workplace. And relationships are enriched

when managers use face time to focus on personal

concerns rathe r than on business tasks.

The alternative workplace is really about comput

ers.

It's no t. The impetus for adopting an AW program

is

rooted in corporate strategy and renewal more than

it is in technology. In a farsighted vision of its busi-

ness,

the U.S. Army is rethinking the fundam entals of

its traditional workplace through a high-tecb digi-

tized battlefield supported by a virtual infrastructure

of knowledge, training, and logistics. Similarly, in

other organizations, the alternative workplace is

really about rethinking the basics: W hat is the real

purpose of your workplace? W hat work is performed?

W ho does it? How do they add value? W hat are their

mo st imp ortan t needs in the workplace? W here,

when, and what types of facilities and systems do they

require? How best

can

you provide them?

everyone can find you because your phone, page

and PC go with you.

Some companies have embraced the concept

hoteling. As in th e ot he r shared-office op tion

hotel work spaces are furnished, equipp ed, a

supported with typical office services. Employe

m ay have mob ile cubbies, file cab inets , or lockers f

persona l s torage ; and a computer sys tem rout

ph on e calls an d E-mail as neces sary. But hote

work spaces are reserved by the h our, by the day,

by the week instead of being perm anen tly assigne

In add ition, a concierge may provide employe

with travel and logistical support. At its most a

vanced, hotel work space is custom ized with ind

viduals ' personal photos and memorabil ia , whic

are sto red electronically, retriev ed, an d placed o

occupants ' desktops just before they arrive, an

the n remo ved as soon as they leave.



THE LTERN TIVE WOR KPL CE

can be located close to customers or to employees'

homes. Satellites can save a company up to 50% in

real estate costs, diversify tbe risk of overconcen-

tratio n in a single location, and broaden tbe po ol of

potential employees. Some are shells-sparsely fur-

nished and equipped with only basic technology;

others are fully equipped and serviced. Satellites are

generally located in comp aratively inexpensiv e cities

and suburban areas. Most often, they have simpler

and less costly furnishings and fixtures than their

dovimtown counterparts.

Telecomm uting is one of the most comm only rec-

ognized forms of alternative workplace. Telecom-

m u t i n g - t h a t i s, pe r f o r m ing wor k e le c tr on ic a lly

whe r e ve r the wor ke r c hoose s - ge ne r a l ly supp le -

ments tbe traditional workplace rather than replac-

ing it . At IBM, bowever, telecomm uters comprise an

entire business unit. And at PeopIeSoft, telecom-

muting is the dominant s tyle of work throughout

the entire company.

General Dennis J. Reimer, the U.S. Arm y's chief of

st ff

offers compelling insight into what an execu-

tive can do from a remote location. Reimer travels

witb a laptop and routinely co mm unicates by E-mail

with 350 general officers and 150 garrison comman-

ders around the world. Using a Web-hased network

called America's Army On-line, which also includes

an in t rane t cha t room s imi la r to those of fe red

through commercial providers, Reimer can raise is-

sues w ith his officers and receive advice on key deci-

sions,

often with in ho urs. Tbe netw ork allows me

to be productive an d to m aintain a pulse on wh at is

happening whether I 'm in Washington or overseas,

Reimer says. It no t only saves travel costs hu t also

enables collaborat ive teamwork across organiza-

tional and geographic boundaries around the glohe.

The

U.S.

Army's General Reimer

rapidly receives on-line advice

rom officers around the globe.

radually, this is changing the culture from one in

sharing is pow er.'

Hom e offices comp lete the spe ctrum of AW op-

C ompanies vary widely in their app roaches to

at hom e at their own discretion an d at the ir

help lines, and full technical backup at the nea

corp orate facility. One major com pany goes still

the r by providing employees who work at hom e w

a $1,000 allowance for furnishings and equipmen

be used at their discretion.

Most organizations find that mix of AW op t

is better than a one-size-fits-all approach. Ind

the very concept of the alterna tive workplace m e

tailoring the program to an organization's spec

needs. AT&T's Creative Workplace Solutions s

egy, for example , combines three options: sha

offices, telecommuting, and virtual offices. Th

optio ns can acco mm odate nearly all of AT&T s off

based functions.

Is th e Altern ative W orkplace Right fo

Your Organization

The first step tow ard determ ining w heth er any o

of the AW options I've outlined could work for y

organization is to answ er a few basic ques tions.

Are you committed to new ways of operati

For example, are you prepared to overhaul per

mance meas ures as necessary to align them w ith

new ways in wbich employees work? Are you bra

for a cultural tailspin as your employees learn

ways of connecting with one ano tbe r from afar?

you com mitted to exam ining your incentives and

wards policies in light of the different ways in wh

work m ay he com pleted? C onsider w hat Kevin Ri

an IBM ma rketin g manager, said about performa

measurement and rewards in his unit after the

bility Initiative was pu t in place: We've always

warded for results, but wb en you are in a traditio

office environment and see the effort that peo

pu t in to a job, it 's very difficult no t to reward th

at least partly for that effort. We d

tend to do that anymore. We focu

lot more on results tban on effort.

it's a difficult transition.

Is your organization inform ti

rather than industrial This dist

tion refers to

a

man agem ent philoso

and style rather than to an econo

sector or customer base. Industria

this context means that the organizat ion 's s tr

ture , systems, and management processes are

signed for intensive face- to-face interact ion

tha t employees remain rooted to spec i f ic wo

places. In such an environment, the potentia l

W

arrangem ents is limited.

Informational organizations, by contrast, oper



THE LTERN TIVE WOR KPL C

sarily mean higb-tecb. But i t does mean that man-

agers and employees are moving up the curve to-

ward information-age li teracy, wbicb is character-

ized by flexibility, informality, tbe ability to change

when necessary, respect for personal time and prior-

i t ies, and a commitment to us ing technology for

improving performance.

Until recently, AT&T and IBM were among tbe

many companies perceived by customers and ana-

lysts as industrial organizations; that is, they were

seen as tradition bound, formal, bureaucratic, and

slow to cbange. As former AT&T chair-

man Robert Allen noted on tbe com-

pany 's Telecommuting Day in 1994,

Work is where the phone is, and it 's

log ica l tba t we sbou ld work l ike a

phone-based organization. When our

i n i t i a t i v e b e g a n , h o w e v e r , A T & T

looked l ike an ant iquated company,

with fixed schedules, expensive space,

an d a heavy hierarchy. W ben the two

co m p an i e s l au n ch ed t h e i r AW p ro -

grams nearly ten years ago, top-level managers had

already begun to reposition tbeir organizations as

informational.

Do you have an op en culture and proactive m an-

agers? A dynamic, nonbierarcbical, technologically

advanced organization is more likely than a highly

structured, command-driven one to implement an

W program successfully. That's why so many new er

and smaller companies-part icularly tbose tbat are

heavily involved in the bu siness of inform ation or in

electronic commerce - are using

W

tecbniques with

great success and witb few transition pains. Yet as

we've seen, even tradition-conscious organizations

can use such techniqu es to elimina te fixed costs a nd

faci l i ta te performance improvements . The key is

whether managers at all levels are open to cbange.

Richard Karl Goeltz, vice chairman and CFO of

Am erican Fxpress , com m ents , I t' s im po rta nt to

have a multifunction team of senior managers pro-

mo ting and supp ort in g a v ir tual-off ice in i t ia t ive

rigbt from the start . We had three departments in-

volve in our effort; HR, technology, and real esta te.

The individuals on tbe team must be enthusiastic

and not unnecessari ly fet tered by t radi t ional ap-

proacbes . And they must be made knowledgeable

aho ut all tbe key issues - from tbe w ays in which cor-

pora te policies may he redefined to deal with various

types of problem s and opp ortu nitie s to tbe different

option s for providing furniture or allowances to em-

ployees. Still , I would be skeptical ab out wb etbe r

m ana gem ent by fiat would work very well. It 's b ette r

to be able to say, 'Here's an opportunity to enable

economically. You don't have to use it, but it's here

Wbat I've seen happen elsewhere - and we're hegin

ning to see it in our ow n initiatives -

is

tbat once

fairly large department takes the first step, other

are qu ick to follow.

Can you establ ish clear l inks between staf

functions , and t ime? AW program s assume tba

certain jobs eitber do not depend on specific loca

tions a nd types of facilities or depend on tbe m onl

pa rt of the t ime . To analyze wh ether an AW progra

can work in your company, you mu st un ders tand i

Managers who assume that the

alternative workplace suits

only road warriors on the sales

force mav be in for a surprise

detail the par am eter s of eacb job you are con siderin

for the program. What function does the job serve

Is tbe work performed over tbe phone? In person

Via computer? All of tbe above? How mucb tim

does tbe employee need to spend in direct contac

wi th o tber employees , cus tomers , and bus ines

contacts? Is tbe location of the office critical to per

formance? Does it m att er w he the r the job is 9 to 5

Is i t important for otbers to be able to reacb th

employee immediately?

If a critical ma ss of corp orate fun ctions can no

work in an AW environm ent, the potential benefit

may be too marginal relative to the required invest

ment and effort . But managers who assume intu

itively that an AW initiative is limited only to roa

wa rriors on th e sales force may be surprise d; often

more jobs are suited to a different way of workin

tban at first seems possible. Executives at Dun an

Bradstreet, for example, initially thought that onl

5%

of tbe ir global workforce could be involved in a

AW program b ut learned tb at two-fifths of the com

pany's functions - involving half their employees

could adapt witb only minor adjustments in wor

practices.

Are you prepared for som e push back ?

As Lo

raine Fenton , vice pres iden t of inform ation techn ol

ogy for IBM No rth Am erica observ es, m ost twen ty

som ethin gs ente ring tbe workforce bave neve r ha

a private office, so to begin their work life witbou

one is no t a trau ma tic change. But for m any employ

ees,

tbe transition from conventional to alternativ

workplaces is not as easy. Employees who are accus




it bard to adjust to a largely self-directed schedule,

and those who are used to working witbin earshot

of

many colleagues may be lonely in a remote setting.

Moreover, middle managers, who lose tbeir visual

and verbal proximity to their direct reports, bave to

change the way in which tbey relate to those employ-

ees. In fact, middle managers usually put up the

strongest resistance to the alternative workplace, in

large part because they feel as though tbe very foun-

dations of tbeir roles are being pulled out fro

under them.

Can you overcome the external barriers to

AW program Even if the work is suited to an A

format and managers and employees alike a

amenable to change, physical and logistical barri

may exist. If space is at a premium in employe

homes - for example, if many employees

live

in sm

apartments - then an AW initiative tbat calls

ATScT's First Shared Office

Richard

S.

Miller, vice pre siden t of global services (GS)

at AT&T, leads some 2,000 sales and support profes-

sionals serving major corporations and government

clients

in

tbe eastern United States. His organization

generates $4 billion

in

annual revenues;

its

expense

budget is about $200 m illion, of which real estate rep -

resents 6%.

In December 1996, Miller learned

on a

television

newscast ahou t

a

competitor's initiative

to

pursue

an

AW

program. Driven into action, he asked tbe belp of

AT&T's global real estate (GRE) organization in devel-

oping a new facility. His idea: a shared office tbat staff

members wbo spend much of their time witb cus-

tomers outside the office would use as needed, witb-

out having assigned w orkstations. The objective: cre-

ating

an

environment

in

wbich teamwork would

flourish wbile reducing real estate costs.

The GRE un it, the n in the early stages of developing

AT&T's Creative Workplace Solutions strategy,

had

not yet planned tbe type

of

facility Miller envisioned.

So

he and

GRE's planning director, Thom as

A.

Savas-

tano, Jr.,

formed

a

team

to

consider the alternatives.

The team rejected several scenarios. One would have

refitted a building already occupied by Miller's group,

bu t th at would have disrupted existing operations. In-

stead, the team opted for a three-part plan: redesign

vacant AT&T space

in

Morristown, New Jersey,

as a

shared office; move

200

employees from five tradi-

tiona l office locations and 25 others from tbree satel-

lite offices

to the

new facility; and redeploy th e space

to

be

vacated.

The

tota l group included

58

salespeople,

101

techni-

cal specialists, and

66

management and support

staff.

Miller knew that the staff would need full-time space

in the new facility. But he estimated tha t

at

least 60%

of the sales and technical people would be out of the

office witb customers at any given time a nd therefore

could share work

space.

At the time, the GS organiza-

tion was beginning to transform its technical special-

ists into virtu l

resources

tha t is, rather tha n dedica

ing individuals to specific customers, these individu-

als would float from one account to an other as needed

That change. Miller reflects, eased th e transition from

a conven tional to an alternative workplace.

The

new

shared office works

as

follows: Through

their laptops, employees

log

onto a system to reserve a

workstation either before they arrive

at

the huilding

or when tbey enter

the

lohhy Once there, they

re-

trieve their own mobile file cabinet and wheel it to

their reserved space. The workstations are six feet

square and are arranged in pairs with a C-shaped work

surface so that two people can work apa rt p rivately or

slide around to work side by

side.

The reservation sys-

tem routes employees' personal phone numbers

to

their reserved

space.

As one occupant says

of

the new

arrangem ent, I don't know who is going to sit next to

me tomorrow, bu t interacting with different people all

the time helps me think about customer issues more

productively. I'm always getting a new perspective and

new ideas from others' experience.

AT&T

has installed thre e low-tech features in addi

tion to its high-tech system s. A cafe encourages peo

ple to mingle for coffee and conversation about new

sales, customer solu tions, and office

events.

Two large

chalkboards allow people to leave messages for others

this feature also reduces

the

paper flow within

the

office.

And

three types

of

enclosed space-phone

rooms, personal harbors,

and

team rooms-accom -

modate private meetings and teleconferences.

AT&T's project shows how significant

the

tangible

and intangible results

of an

AW initiative can he.

It

cost

2.1

million

to

develop, including construction

furniture, equipment,

and

systems.

But the

invest-

m ent was well worth tb e effort, as the accompanying

table shows. Annual savings alone amount to more

than $460,000, or $2,000 per person. Over five years,

the company will avoid nearly 2 million in costs asso

ciated with running

a

traditional office.

In

addition




people to work at hom e m ay not be feasible. Tbis is a

key consideratio n in U.S. cities and in m ost coun-

tries abroad. In Japan, for instance, there simply is

no swing space in mo st emp loyees' hom es that

could be used as office space; to accommodate a

home-office initiative tbere, employees would have

to sacrifice living space. Conducting employee focus

groups at the exploratory and planning stages of an

W initiativ e can uncov er such con cerns effectively.

individual space was halved, and team-meeting space

doubled. Finally, the project has produced closer

teamwork, better customer service, and greater em-

ployee satisfaction.

Shared Office Metrics in Morristown

Square feet

Annua l ren t

Five-year expense

Five-year after-tax NPV

Annual ren t

per square foo t

Persons

Square feet per p erson

Annu al rent per person

Annua l te lecom

cost per person

Total pro ject cost2

Total project cost

per square foot^

Total project cost

perperson^

Annual savings

Before

45,000

$1.2M

$6.4M

$1.9M

$2 6

196

23 0

$6,100

$10,600

NA

NA

NA

NA

After

27,000

$0.7M

$4.5M

$1.2M

' $26

V 225

^ 120

$3,100

$11,200

2 1

M

• 7 9

si

$9,500

" $463,500

igures in the

table

have been rounded.

^ This metrkincludes recurring voice and data cha rges; without teairring costs

AHer h$3.9M.

This metric includes total cons truction, furniture, voice and data installation,

and training and

systems costs.

Will you inves t in the tools training and tech-

niques that make

W

initiatives work? To improve

the chances of an AW program's success, all who are

involved must be armed with a full set of tools; rele-

vant training; and appropriate, flexible administra-

t ive support . Are you committed, for example, to

providing standardized computer software for peo-

ple working in all locations? Accessible, qualified

technical assistance? Do you bave the financial re-

sources to provide the above?

Too m any W programs are und ertaken with only

part ial support from the organizat ion. Confusion

and f rust ra t ion inevi tably ensue , not to ment ion

drops in productivity. These programs are only mar-

ginally successful and might ultimately fail. When

an employee at home can't communicate witb otber

employees or clients, access the right information,

or easily reach a help desk to solve a technology

problem, the initiative is destined to fail. As AT&T's

Jam es puts it, Tbe technology has to work from tbe

start . Wben you're asking people to give up tbeir

space and all th at goes with it , you owe it to them to

make sure tbat the systems are flawless. Because

employees are mobile, the tools tbey use are tbeir

lifeline. Tbey can't survive witho ut tbem.

If you have answered yes to tbe foregoing ques-

t ions,

you could seriously consider an AW progra m.

The nex t step is to drill down into th e economics of

AW initiatives.

Tangible and Intangible Economics

As I suggested earlier, the ma in reaso n for AW pro-

grams is to reduce current costs and avoid future

ones. For established organizations tbat are pressed

for cash, the savings from relinquishing space and

making better use of what remains can dwarf the

necessary investment in equipment and t ra ining.

For young organ izations, an AW progra m can give

managers a viable al ternat ive to expensive, long-

term lease commitments.

But for the typical enterprise, tbe economics of

the altern ative workplace are more complex, and the

decision to adopt an AW progra m re sts as much - or

mo re - on intan gibles as it does on simple financials.

Jerome T. Roath, IBM's manager of infrastructure

expense, says, Tbe obvious savings from real-estate

cost reduction may bide qualitative improvements

in employee satisfaction and customer service that

are less measurable bu t no less im po rtan t and in tbe

end m ight justify an [AW] prog ram .

On tbe fiip side, AmEx's Goeltz com me nts on bo w

a busin ess might think abo ut satellite locations: In-

stead of 2,ooo people conc entrated in one place, one

could consider loo sites of 20 people each around



LTERN TIVE WO RK PL CE

e

country.

That might cut

real

estate costs trem en-

eria and health club facilities or instead provide

one coordinate HR activities across a dis-

group?

Managers should look at the economics of a po-

AW program from three pe rspe ctive s-tbe

, the employee's, and the customer's - and

lude hardware, software, training, and

e act of removing the walls

shings and equipm ent. Intangible costs for the

and ways of communicat-

with colleagues and customers.

Aside from real estate savings, the organization

yees have both more professional and m ore per-

participant gained almost

fiv

weeks per

eliminating

a

50-minute daily comm ute. Em-

o can be more efficient during the workday be-

As

AT&T's James notes, When

I

have 30 min-

etween meetings, I can load in my disk and be

ve on the spot. Customer satisfaction also

, personal a ttention.

Intangible benefits include closer teamwork and

ment works. It really helps us communicate quic

and effectively because we're all together.' There

definite improvement in communication, and c

m unication me ans productivity. W hat's mo

meetings in the alternative workplace take less t

because participants m anage their time be tter; t

meet not just to discuss issues but to resolve th

The

U.S.

Army's Reimer highlights tbe importa

of intangible benefits in his widely dispersed orga

zation:

The

biggest benefit

I

bave found

is

that l

ers who are 'far from the flagpole' in places

Bosnia and Korea

have

direct access to me and to

latest thoughts on many issues. In turn, I rece

feedback from the field army as quickly as I wo

from my staff at the Pentagon. This empowers

leadership team, and it allows the army to speak

act with one voice on rapidly changing situatio

A

crucial intangible benefit of an

program is the value that employ

place on increased personal time

control. Although they tend to w

longer hours and may even have di

culty leaving their home offices, A

employees find the promise of fle

bility attractive, so they are easie

recruit and retain. As Reimer sa

We are now training soldiers when and where

needed. This not only reduces costs and impro

readiness, but it

also

reduces the time soldiers sp

away from home and family-an ever-increas

burden with our intensive training and operatio

requirements. This helps us retain quality sold

and their families.

The chart

AT&T's

Creative Workplace Plan i

trates one company's assessment of its tangible e

nomics. Over the next fiv

years, AT&T's

initiati

expected to generate annual savings of nearly

million as people become accustomed to and t

full advantage of the new style of

working.

This

be a subs tantial contribution to AT&T's overall

of reducing annual occupancy costs by $200 mill

The plan begins by defining th e ratio of occupan

work space for each type of office, the square

and cost per person, and the expected savings

payback. Shared-office and virtual-office work

use one-third to one-tenth as much corporate sp

as they do in traditional offices. Over time, th

changes could yield annual savings of $5,000

$10,000 per person. For a group of 100 employ

occupying space that costs $24 per square foot,

savings range from $200,000 to $600,000, and p

back ranges from one to three years. AT&T's Jam

who authored the plan, estimates that some 34,



THE LTERN TIVE WOR KPL C

IBM s experience in the alternative workplace pro -

in 1989 to reduce real-estate-related costs and

1993, the company s profitabihty and compet-

veness had declined to the point th at m ore funda-

ntal changes in corporate strategy were called for.

America sales and service organization - an initi

tive designed to improve customer responsivenes

reduce costs, and increase productivity.

Lee

A. Dayton, IBM s vice president for corpora

development and real estate, recalls,

Two

principl

were-and are-at the heart of the initiative. Fir

we

want to reduce our employees travel

time.

Wh

they are traveling from one customer to another,

from the IBM office to the customer, they re no t pr

ductive. Second, if employees are at home or at

ATScT's Creative Workplace Plan

AT&T's five-year plan reflects the significant

impact of creative workplace initiatives on

reducing total occupancy costs. The financ ial

benefits result from five interrelated factors to

be implemented over time: shifting from tradi-

tional to shared and virtual offices, adopting

more efficient individual workspace designs,

improv ing office uti l ization, reducing total

company space, and adjusting the number of

occupants using company space. The plan's

current benchm arks and overall projections are

summarized below.

Benchmarks

Costs

Savings

Off ice Type

Trad i t iona l

Shared

Vir tua l

Uti l izat ion Square feet per person per person^ per unit^ Payback

ratio per pers on (setup) (annual) (annu al) (years)

1:1

3:1

10:1

22 5

12 5

30

12,000

7 5

5

Projections

12,000

9

6

NA

450,000

600,000

NA

1.4

0.8

Factor

Square feet

(mil l ions)

Square feet

per person

Nu mb e r o f

occupants

An n u a l

savings

( mil l ions)

Tradit ional

28.5

30 0

95,000

NA

Shared

2.8

20 0

14,000

NA

1998

Vir tua l

0.6

15 0

4

NA

Tota l

31.9

28 5

(average)

113,000

NA

Tradit ional

18.3

225

81,000

153

2002

Shared

2.0

125

20,000

30

Vir tua l

0.6

30

10,000

19

Total

20.9

19 0

(average)

111,000

202

Differences^

Total

-11.0

-9 5

-2,000

-202

CW P

-2.9

-9 6

+12,000

-4 9

' This metric includes real estate as well as voice and

d t

communications

costs.

This metric is based on 100-person unit occupying leased space t 24 per square

Differences

for

each factor reflect the changes In

the tot l portfolio

from January

1 19

to

December 3 J, 2002. They also reflect the changes

ttribut b le to the

creative workp

initiative during the same period.



THE LTERN TIVE WO RK PL CE

cus tomer ' s office, we want to eliminate the need

to travel to an IBM office. And if they 're n ot go ing to

work in an IBM office, we wan t to elim inate th e d ed-

icated space with all of its ove rhead an d services.

Curren tly, IBM's en tire U.S. sales force can o per ate

independent of a tradit ional workplace. More t ha n

12,500 employees have given up the i r dedica ted

work spaces, and another 13,000 are capable of mo-

bile operation. IBM also has implemented mobility

ini t ia t ives , involving some 15,000 employees in

Asia, Europe, and Latin America. Thus, approxi-

mately 17% of IBM's total worldwide workforce is

sufficiently equipp ed and trained to work in AW for-

m a t s ,

and one-thi rd of a l l the company's depart -

me nts have a t least some mobile employees.

The results? Iri 1992, worldwide occupancy and

voice-IT expen ses (th at is , phone-based comm unica-

tion charges) totaled $5.7 billion. By 1997, the total

had dropped 42% to 3.3 billion. During that period,

real estate savings totaled $1 billion from mo bility

initiatives alone. Even more telling, worldwide costs

per person declined

38%

from $15,900 to $9,800, and

the combined ratio of occupancy and voice-IT ex-

penses to revenues dropped from 8.8% to 4.2%-a

52% imp rove m ent. (See the char t The Economics of

Mobili ty at IBM North America for a breakdo wn

of these measures.)

As Roath comments, IBM must keep close watch

over voice-IT charges. They are still small compared

with occupancy costs and other IT expenses , bu t

they could explode as more people go mobile. Still,

Dayton says, The costs you incur with mo bi lity - IT

technology, comm unications, wireless cos ts -are a l l

going down, while the relative costs of real estate

cont inue to rise.

Dayton also notes tha t the key to success is evalu-

ating and ma naging the init iative with the u lt imate

bu sine ss goal in m ind : We cost-justified our pro - :

gram based on reduct ions in spending, pr imari ly

A

phased approach to an AW

program is essential in order

to test what's acceptable.

from real esta te. From the sta rt, we allowed bu siness

managers to make the trade-off between real estate

savings and inv estm ents in technology. And we in-

sisted on saving more than we spent. Every laptop

and cellular phone we bought for the initiative was

cost-justified. We also introduced an annual world-

person . The scorecard applied to manufacturing an

deve lopm ent d ep art m en ts as well as to sales and di

tribution. We published the results internally, an

of course, nobo dy wa nted to be last.

Looking ahead, John Newton, IBM's manager

IT plans and measurements, believes that the com

pany's extrao rdina ry cost savings will plateau: Th

main short-term problem in mobili ty economics

that as more people go mobile, we still need a su

po rt s tru cture for the m . We are reaching a point

diminishing returns, because we can't keep pull in

people out of offices forever. There will be produ

tivity benefits b ut n ot occupancy cost savings.

Indeed, any organization adopting an AW init i

t ive can be expected to reach a new plateau-wi

lower fixed costs, higher productivity, and great

employee and customer satisfaction than i t prev

ously experienced. But by redeploying some of th

savings into bet ter equipment , technical suppor

even the company

picnic,

the organization that be

efits from AW initiativ es can realize fur the r div

dends in employee comm itmen t and loyalty.

Implem enting an W Initiative

If the economics are favorable, you should consid

i m p l e m e n t i n g a n A W i n i t i a t i ve . T he fo ll ow i n

guidelines will help you cha rt your course.

S ta r t wi th a p i lo t pro jec t and don ' t overcom

plicate i t . An AW prog ram can be designed either

pilot testing or for full implementation. The choi

will depend on m any factors. If

a

company

is

hemo

rhaging, then a full-scale rollout makes sense: t

ne ed for radical chang e to red uce costs will be clear

and universal ly unders tood. And i f the compa

already is informat ional , wi th a large number

t ravelers and independent workers , then tbe r i

of failing at full implementation is low. For mo

orga nizatio ns, however, an AW prog ram involves

m a n y i n n o v a t i o n s a n d d e p a r t u r

from deeply held norm s tha t a phase

experimental approach is essential

test what 's acceptable and to chan

wh at isn' t . Because this is no t bus

ness as usual, it will take extra m a

agement t ime and attention, talent

staff e xpe r i e nc e d c ons u l t a n t s , a

some expense to ensure success.

It 's a good idea to begin with obvious functions

such as personal sales, telemarketing, project eng

neering, and consul t ing-in which individuals a

ready work wi th thei r c l ients by phone or a t t

clients' premises. Such employees are largely

se

directed and need only their phones and laptops

operate in the a l ternat ive workplace. Their inp



THE ALTERNATIVE WO RKP LAC

The

Economics

of Mobi l i ty

at IBM

Nor th

America

IBM's entire

U.S. s les

force

can operate independent of

a trad itional office. More than

12,500 employees have given

up their dedicated work

spaces,

nd

another 13,000

are capable of m obile opera-

t ion.

Managers m onitor th e

performance o f the company's

Mobility Initiative in several

ways, including those illustrat-

ed at right.

The top chart shows the total

occupancy and voice-IT costs

for IBM North America.The

middle

chart,

which breaks

dow n those costs by employ-

ee, he lps managers assess

whether the Mobility Initiative

is using space, information,

and comm unications e fficiently.

The bottom

chart,

which shows

total occupancy and voice-IT

costs as a percentage of IBM

North America's revenue, helps

managers assess the produc-

tivity a nd efficiency of the

Mobility Initiative.

Voice-IT Costs

j Occupancy Costs

I Total Costs

o t a l O c c u p a n c y a n d V o i c e - I T C o s ts

$0.7 S0.7

$0.1 $0.1 $0.6

$0.6 $0.6 $0.1

$0.5

1992 1993 1994 1995 1996 1997

; Occupancy and Voice-IT Costs pe r Perso

$16.1

$1.6

$1.9

Si 6.4

$14.3

$' .5 $1.7

$12.6 $11-9

9.9 1.5

v m

^SSM

1993 1993 1994 1995 1996 1997

3 ancy and Voice-IT Costs as a Percentage of Revenue

6 —

5 3 %

0.5%

i;

1993 1994 1995 1996 1997



T H E A L T E R N A T I V E W O R K P L A C E

could be decisive in ensuring a successful project. In

fact, IBM's Dayto n credits m uch of the success of his

com pany's initiative to the fact tha t it was a bo ttom -

up effort. We provided direction from th e top about

our goals, he explains, but we we nt deep into th e

organization to make the program work. Relatively

low-level people helped plan it, and local manage-

ment implemented i t . We encouraged them to ex-

periment. It was a peer-driven effort by and for the

people w ho were going to be affected.

David House , pre side nt of Estab lishm ent Services

Worldwide at American Express, began an alterna-

tive workplace initiative in 1993 with a pilot project

for 300 sales and account service reps in 85 field

offices thro ug ho ut the United States. By 1995, only

7 offices were needed, the participants were enthu-

s ias t ic , and customer sat is fact ion rates had im-

proved. Based on th at success, a second pilot pro

was l aunche d a t the New York he adq ua r te rs

muc h to ugh er cballenge. Alan Haber, AmEx's pro

director, says, The savings from a virtual-office

gram are much greater at headquarters than in

field offices because we have so mu ch infrastru c

and administrative support here. But there's

mo re resistance to virtu al offices. M any people

to come to this bu ilding and d on't w ant to give it

In foreign op eratio ns, pilot projects can be pa

ularly valuable because they allow a company

freedom to experiment in an environm ent in w

cultural and physical differences can be profo

For example, a proactive approach that works in

United States may be counterproductive or do

right destructive abroad. The AW concept can

be nur tur ed in small-scale situa tions wh ere the l

How Senior Executives at American Express

View the Alternative Workplace

Richard Karl G oeltz is vice chairman and chief financial officer and David ouse is president of

Establishm ent Services Worldw ide at American Express. Goeltz has overall responsibility for

corporate real estate at AmEx and is a sponsor of the company s AW initiatives. When House

joined AmEx in 1^93, his division launched a virtual-office strategy in its field offices and has

recently com pleted a similar pilot project at its headquarters. Here, the two sum up some of the

salient considerations for managers who are assessing the pros and cons of AW initiatives.

On the ben efits of an AW program Goeltz com-

ments:

The benefits can be realized in terms of cus-

tomers, employees, and

shareholders.

In terms of cus-

tomers, if a company has a sophisticated, highly

efficient network for communications and data ma-

nipulation - an essential component of

a

broad-based

virtual-office initiative - the n its employees sbould be

able to respond more fully and m ore promptly to cus-

tomer needs ranging from simple inquiries to more

complex product demands. In terms of staff we've

found tha t

we

can draw from a broader pool of people

because our employees can be in niany locations.

Through virtual-office programs, we might be able to

attract people with proven records of success who

can't or w on't move to our office sites. If we can say to

such qualified

people, We

can offer you

a

stimulating,

rewarding, well-compensated position, and you can

work at home, then that is good for the company and

for th e economy. In term s of shareholders, if a company

is giving its customers better service and is realizing

savings on real estate and so forth, tben naturally

there are substantial shareholder benefits.

House underscores the potential:

Here's an exam

ple of someone the company would have lost had w

not been flexible in our work arrangem ents. A man

ager in one of our divisions was going to leave the

company when her boss asked me if she could tak

an open position in our Chicago office but live in

Michigan. I told him, If she's the right candidate, sh

can live anywhere. She now goes to Chicago severa

times a month. W hen I talk with her on the phone,

don't know whether she 's in Chicago or Michigan. Sh

travels a fair amount of the time anyway, so it reall

doesn't matter where she lives. This is a quality-of

life issue for the employee. But for th e company, it's an

issue of finding he best person for the job.

Goeltz continues:

The question is whether or not

virtual-office program dovetails with the kind of busi

ness a company do es-w heth er it can serve an opera

tional need or help improve performance. There ar

particular opportunities in financial services bus

nesses like ours because our business is information

But each case-ind eed, each department or division

must be considered separately.



THE LTERN TIVE WO RK PL

leadership is enthusiastic, the employees are willing

to innovate, and the work environment is conducive

to change.

Segment the workforce you are considering for

the alternative workplace and

assess

the logistics

of the proposed new arrangement. Whether you're

designing a pilot project or rolling out a full pro-

gram, the first step is to divide the target employees

into three segments that define their ties to the

workplace: office hound, travel driven, and indepen-

dent. Employees are best grouped hy position rather

than hy individual, and jobs should be analyzed in as

much detail as the data allow. Figuring out the logis-

tics of how employees will work together when they

are no longer rooted to a traditional setting is a more

straightforward task if

you

have a clear idea of what

they currently do and how and when they do it. Vari-

ous AW formats can apply to each segment,

so

sharper this analysis, the easier it will be to desi

an appropriate program. The criteria below are n

hard-and-fast definitions but guidelines that ea

organization should adapt to its own situation.

Office bound

staff members spend nearly all t

time in a single, fixed, assigned location, wheth

they are working alone or as part of a team. The

workplace is typically composed of private offic

workstations or cubes, and meeting rooms. T

more these spaces are clustered, the more team i

teraction occurs, but the harder it is to ensure ind

viduals' privacy. For office-bound workers, de

sharing may be applied in multishift operatio

where work patterns are predictable. For examp

two or three people could be assigned to the sam

office or workstation during daily shifts in a roun

The two managers agree that getting people to

adjust

to

new ways

of

working

is a

major hurdle.

Goeltz says: Consider the manager

who is

accustomed

to walking into a traditional office and seeing 50 peo-

ple.

In the v irtual office, midievel managers relinquish

direct, visual employee supervision. The

key

differ-

ence is th at in an information industry, productivity is

monitored through electronic systems, whether or

not the manager is

on

site. How many calls does an

employee handle? How well and how quickly?

If

a su-

pervisor periodically wants to listen in on a conversa-

tion to determine how a customer representative is

handling a call, it doesn't make any difference whether

that supervisor

is

in th e next office or halfway around

the world, barring time zone considerations. You

don't have to be physically present to mo nitor produc-

tivity, efficiency, and quality

of

customer service. But

is extremely difficult to change the mind-set that

really wants t ha t presence.

House concurs, noting tha t the change is equally

challenging from the employee s viewpoint:

It takes

discipline and confidence for people to feel good about

this and say, Look, I'm going to telecommute. I'm go-

ing to work at home two or three days a

week,

and I'm

going to come in here for meetings only twice a week.

People have the feeling t ha t if they're not in the

office - if they're not seen - they'll be overlooked. One

of the ways to overcome tha t is to encourage telecom-

muting

at

senior levels

of

the organization and let the

rest of the company see how it works, I really believe

that acceptance

of

the virtual office

is

mainly

a

ques-

tion of leadership - taking a position and showing that

it's now part of our culture.

Goeltz stresses

the

difference b etween encour-

agem ent and force: It is dangerous, at best, for senior

management to mandate an AW scenario. W hat one

has to do is to demon strate the benefits that can be

achieved from virtual-office concepts, satellite offices,

and other arrangements that share the same princi-

ples.

When th e benefits are clear - be they cost reduc-

tion, improved customer service, or reduced commut-

ing times - the n people will be more likely to embrace

the new way of working.

House observes th at participants should under-

stand the advantages and the limitations

of

the

al-

ternative workplace: The virtual office is not, and

should not be, an all-or-nothing scenario. For exam-

ple,

it is far more difficult to have a brainstorming

meeting over

the

phone, because

you

can't have

the

same give-and-take and you can 't read body language.

And yet it is also critical to understand tha t time spent

in the central office-in the presence of colleagues - is

not the same as it used to be. In the virtual office, if

employees come to a m eeting, it is for a particular pur-

pose. Something has to be accomplished, or else the

time has been wasted. n the traditional office, a group

of people might meet to dis uss a certain issue. In the

virtual office, when people meet, they should de ide

the issue. In the virtual office, the old adage Time is

money

is taken to a new level: tim e is

money,

satisfac-

tion, balance, performance, and a host of other things

as well.



THE LTERN TIVE WO RK PL CE

the-clock Operation, or up to six people could use t he

same space on different days of the week.

Travel driven

staff members spend at least half

their time visiting sites outside their assigned loca-

t ions ,

usually for transactions and projects. In fact,

their performance is based largely on their capacity

to spen d as muc h tim e outside th e office as possible,

eith er with clients (for tho se in sales and consulting )

Monitoring the performance

ol people you can't see is not easy.

Set clear goals from the outset,

or vour employees may founder.

our

or while working on projects (for auditors and engi-

Technology can release these travelers al-

cause they need face-to-face time with clients and

ndependent

employees can set up anywhere and

In contrast to the other two segments, these

cific locations . They do no t dep end on direct con-

spaces.

W riters, consul-

and scholars are traditional examples of the

n y f u n c t i o n s c a n w o r k i n d e p e n d e n t l y e v e n

erpr ises. Such people often favor a ho me office to

d inte rru pti on s; to be close to thei r families; and

l tastes - an opp ortu nity no t offered in mo st

Make sure that managers and employees are

ar bo th on performance objectives and on h ow

In a t radi t iona l

mo nitoring th e perfor-

As Karen Sansone, director of a l ternative wo

place solutions for Lucent Technologies, puts

You m us t get dow n to basics. Is the re a deliverab

How do you know wheth er the employee or dep a

ment has done something of value? For some typ

of employees, performance is clearly measurab

For o thers , i t i sn ' t . Whi le cons ider ing d i f fe re

groups for remo te work, managers realize that th

ne e d bo th to im pr ove the i r und

standing of what their people are d

ing and to focus on productivity. R

mote work forces managers to thi

hard about the purpose and results

each job.

Once objectives and measures are

place, the management challenge b

comes ada ptin g to a new style of wo

ing. Sansone continue s, Remote ma

agement i s rea l ly about a d i f fe re

form of comm unica tion. For example, if an employ

in a traditio nal w orkplace is having difficulty achi

ing an objective, he or she could po p into th e m ana

er's office and say 'I have a problem. I need yo

help. '

Or as a manager, you'd be checking in w

them anyway. In a virtual office, people learn diff

ent metbods. In conventional off ices, employe

sometimes wait at the door to catch their super

sors for a quick meeting. That's a waste of time y

do n't come across in the virtu al office. W hat's m o

the virtual-office manager and employee set age

das for their conversations so that both are bet

prepared.

Sansone and other managers agree that some

rect contact

is

essential in the alternative workpla

Performance evaluation and salary reviews must

do ne face to face, says San son e. So mu ch of t

managers' impact comes from sensitivity to indiv

ual reactions and the ability to gauge body langua

as well as words - reactio ns t ha t simply are im pos

ble to interpret over the phone or through E-mai

Managers in an W enviro nm ent, particularly o

in which employees work from a distance , m us t a

pay close a t tention to t ime m anagem ent. W hen e

ployees are in the office only once a week or seve

times a month, it is critical that their time is n

wasted. In a conventional office, changing the ti

or the day of a mee ting at the last m inute may be

conv enient for employees; in a virtua l office, it m

disr upt their work plan s for the entire day, or wor

Equally important are the peer re la t ionships-

critical to any career - th at flourish autom atically

the conventional office but could atrophy in the

ternative workplace. Joel W. Ratekin, a director



THE LTERN TIVE WO RK PL

for a manag er to grab anyone who is sitting

nd the office to pu t out a fire. The rem ote work-

anager has to think of con-

him. One AmEx unit uses a buddy system in

Train for culture as well as tech nique

So mu ch is

o. From an early

age,

we learn how to live in organi-

have to learn to be in and of the orga-

while not being at it; at the same time, we

our w ork and family lives while

hom e. Savvy leaders under stan d tha t orga-

ot be taken for granted in th e

to create or ma inta in a n office cu lture in certa in

formats - for example, when m anagers an d the

ey m anag e rarely mee t face to face. Nor is it

to figure out how m uch, or how little, a ma nag er

anagers and employees have to

in

and

of the

ization while not being

t

it.

n helping employees balance th e

ndaries betw een work and hom e life.

Merrill Lynch runs a telecommuting lab to accli-

large room equipped w ith workstation s in their

tomers, and colleagues solely by phone and E-ma

If they do n't like this way of work ing, they can dr

out and return to their usual workplace. To da

nearly 400 people have successfully moved from t

simulation lab to their own home offices. The l

has proved viable way to m inimize the risks of

pl

ing people in the alternativ e workplace.

All the organ izations I've cited have developed e

tensive tra ining mater ia ls and techniques to su

their particular needs and situations . AT&T's Jam

stresses the basics in a survival training cours

How do I reserve work space? How do I route t

ph on e and pager? How do I access the datab as

These companies a lso use r i tua ls to teach ne

norms to AW participants - particularly those w

will be working from home. Lucent's rituals inclu

such simple tasks as writing to-do lists, dressing f

work, giving dep en den ts a good-bye kiss whe n lea

ing for the office at the beginn ing of the workda

then tidying up the desk, forwarding calls, shutti

down the com puter, and watching the evening new

at the end of the

day.

These rituals replace traditio

office routines such as morning conversations, co

fee breaks, even the commute

itself

They also crea

the breaks between home and work that help mai

tain a balance. Lucent's Sanso ne, herself a full-tim

hom e officer, believes th at such rituals are critica

important for telecommuters because they link t

trad ition s of the conv entiona l office to the new re

ities of the home office.

Similarly, AW emp loyees ad apt to telework

creating r i tuals to suit their new schedules. O

Lucent office has established a Wednesday morni

do ug hn ut club where virtual-office salespeop le dr

in for chatter and coffee. They used

meet informally at the water cooler

talk about particularly rewarding sal

o r p r ob le m s wi th c us tom e r s . No

Sansone says, they think in advan

about what they want to share wi

the group and the kind of feedba

they need . AT&T's Jam es has design

a cafe at one drop-in facility to encou

age casual collisions : tho se sp on t

neous encounte rs tha t occur whe

people gather and com mun icate. We also have u

hols tered chairs with fold-down tables tha t go acro

you r lap so you can wo rk at them , she says. It's

different environment-like being back in college

E d u c a t e c u s t o m e r s and o t h e r s t ak e h o ld e r

Don't expect customers, suppliers, and other stak

holders to understand your new work system imm

diately. Just as employees need time to ramp up,



THE LTERN TIVE WOR KP L CE

launching an AW initiative, let customers and othe r

stakeholders know what is going on. Explain how

the new way of working may affect their contact

with the organization, stress the benefits they s tand

to gain from the change, and be pa tient.

David Russell , a client marketing representative

for IBM, says th at his c ustom ers took a bit of time to

adjust but notes that now communication is more

efficient t ha n ever: I'm no t in the office as much , so

it's more difficult to reach me in person right away.

Initially, I think cu stomers found tha t frustrating.

AW employees must draw a firm

line between their hom e and work

hves-and be confident that the

line is in the right place.

But now they realize th at I 'm never mo re tha n a few

min utes away from voice mail and tha t I can retu rn

calls fairly quickly. Ma ny of the m are in similar situa -

tions;

so we communicate a lot more by voice mail.

And people have learned that if they don't reach me

in perso n, the y sho uld leave a very specific message

abo ut the n atu re of their call so th at I can start satis-

fying their needs immediately rather than playing

pho ne tag.

Keep an eye on how participants balance their

work lives with their hom e lives

If one of the key

reasons you are implem enting an AW program is to

attrac t and retain employees who will add the mo st

value to your organization, then you must ensure

that they are capable of handling the balance be-

tween their work lives and their personal lives. Do-

ing so requires a good deal of ho ne sty on b ot h sides.

In large part, th e so lution lies in the employee's abil-

ity to draw the line between w ork and home and to

be confident t ha t the line is in the right place.

Two que stions on IBM's survey of its AW employ-

ees are How well are you balancing your workload

and perso nal life? and Does the company foster an

enviro nm ent t ha t allows you to do that? As Brad

Geary, an IBM tech line sales specialist, says, Even if

the company fosters such an environment, the real

quest ion is . How well are you doing? One of my

teammates is in San Diego, and at luncht ime, he

goes running on tbe beach. But he feels guilty that

he's out enjoying himself du ring tha t par t of the day.

The company can emphasize the message that

long as it 's ma de up for in some o the r way and yo u

still meeting your objectives, it 's okay. But the e

ployee has to believe it.

Jeffrey Hill, a project m an ag er for IBM Global E

ployee Research, agrees that the responsibility b

longs both to th e com pany and to the individual. H

lives in Logan, Utah, and telecommutes with int

nal clients throug bou t the country. He repo rts to

executive in New York whom he sees only seve

tim es a year. He says, It's really abo ut a change

min d-se t . W hen I r ead tbe w r i te

com me nts on employee surveys, tho

who have been successful in mobil

are really glowing about 'coaching

daughter's soccer team at 3:30 in

af ternoon ' or 'eat ing breakfast w

my family for the first time in

5

ye

at IBM.' But then there are others w

say, 'I'm always at w ork. I have m y e

tronic leash. I'm never free. '

What can be done in the corpor

culture to help sup port a healthy balance? We ge

lot of suggestions that we should avoid highlight

Lou Gerstner's habit of bringing suitcases of wo

ho m e w ith him every night, Hill jokes. But as

poin ts out, the true solu tion lies in an ongoing eff

by bo th th e employee and t he com pany to offer po

tive reinforcem ent continually, until and beyo nd

poin t whe re bo th sides are com fortable with the n

work ar rangem ent .

Organizations today are poised on the edge o

new frontier: th e alterna tive workplace offers a p

found oppor tuni ty to benef i t both the individ

and the enterprise. But beyond one frontier lies

o t h er - what one might call a mobility

paradox

IB

Dayton explains, We talk abo ut mobility,

but

next frontier is lack of mobility. The alternat

workplace - and all the technology th at enables

is changing th e way people collaborate. Indeed ,

are mov ing from an era in which people seek conn

tions with one an oth er to an era in which people

have to decide when and where to dis co nn ec t-b

electronically and socially. Organizations that p

sue AW initiatives - particularly th ose with ho

office arrangements - must be mindful of that p

dox. For only those organizations that balance in

vidual and corporate interests will realize the c

cept's full pot en tial.

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