Measuring Results

Excerpt from presentation to Office of Personnel Management (OPM) September 2013

When it comes to setting goals for telework (or anything else), the SMARTER mnemonic shows the way. Goals need to be:

…with emphasis on measurable.

Having goals for your program is hugely important. As Yogi Berra put it, “If you don’t know where you’re going, you’ll wind up somewhere else.”

It’s equally important to know where you’re starting from. If you don’t establish a base case, you can’t measure results. Or, with apologies to Yogi, “if you don’t know where you started from how will you know when you get there?”

Such measurements are essential for tracking progress, keeping people motivated, spotting problems, and defending your program when leadership changes.

Real Estate Savings

You might set a goal of an “x” square foot reduction in rented space by a certain date. Or your real estate goal might be to increase your workforce by X people without expanding the office footprint (as they’ve done at VA, USDA, PTO, and other agencies). But those aren’t the only kind of real estate goals you might set. Here are a few others:

Using our calculator we estimated that twice weekly telework among USDA’s eligible population, for example, could allow them to reduce real estate costs by
nearly $100M a year.

But reducing real estate cost is only one possible telework goal worth perusing.

Productivity

Increased productivity can, surprisingly, produce a higher return on investment.

Study after study, in a wide range of industries and cultures, show teleworkers are 15 to 55% more productive than the office-based workers.

The primary reasons are:

Here’s a wordle (word cloud) we produced from more than 1,000 comments offered by federal employees when they were asked if the were more or less productive when working remotely.

You might be inclined, as you should, to not trust self-reported results. But telework managers largely agree.

Ninety-five percent of managers at AT&T agreed or strongly agreed that teleworkers are more productive than their office counterparts.

A Brigham Young University study looked at 24,000 employees and found that teleworkers could work 57 hours a week before they felt it interfered with their personal life. Office workers, on the other hand, reached their limit at 38 hours – a 19 hour difference (and a couple hours shy of a standard 40 hour workweek, you’ll note).

In the private sector, one Silicon Valley exec describe telework as a buy three, get one free program. Teleworkers, that is.

How to measure productivity seems to be the wholly grail of management in the information age. It’s not impossible, organizations are doing it through a combination of surveys, output measures where available, speed/accuracy tests, customer ratings, reduced overtime, and so forth.

Call centers are particularly good at tracking telework’s impact on productivity. You can directly measure sales per person, upset volume, customer service ratings, and so on. The result are clear and dramatic–which is why there are a growing number of all-virtual call centers. They attract, screen, hire, train, and manage people they’ve never seen in person and have lower turnover and higher performance.

For USDA, we found that a mere 12.5% increase in productivity on telework days, across its eligible population, would add over $300M in annual value.

Attraction and Retention

Okay, moving on to the impact of telework on attraction and retention–if government expects to attract the best and the brightest, it will need to compete not just with the average private sector employer, but the best of them.

But there’s a problem: employees are bummed out, burned out, and stressed out. Engagement is at an all time low. According to a Gallup survey, more than 70% of the workforce is not engaged. Worse, almost 20% are disengaged (which Gallup defines as either wandering around in a fog) or actively undermining their co-workers’ success.

Industry experts put the cost of turnover at 150% to 200% of salary for non-exempts, and 75% of annual wages for exempts. That doesn’t include the cost of lost organizational memory, potentially disgruntled customers, and other employees that follow their cohorts to the exit.

Here are some examples of attraction/retention factors you might use to establish telework goals.

In terms of retaining employees, BritishTelcom’s rate of new mothers returning to work is 99% compared to UK average of 40% – something they attribute to their “anywhere working” plan.

And in the U.S. we know that 70% of Boomers want to continue working, but they want to do so in a way that allows them flexibility.

If USDA reduced turnover costs by 4% through telework, the savings would exceed $9M a year.

Absenteeism

Then there’s the impact of telework on absenteeism. Unscheduled absences cost employers billions. They require staffing redundancies, inconvenience coworkers and customers, and reduce productivity and morale.

Telecommuters are sick or absent less often because the reasons shown here, but perhaps the most important reason they’re absent less is that they are more satisfied with their job and therefore less likely to take a “mental health day.”

Indeed, studies have found that just offering employees flexibility–whether they use it or not–makes them happier with tier job and less likely to be absent.

Consider that every day an employee is absent costs you about $500 a day in lost productivity. The number goes up if you have to bring in replacements or customer service suffers.

Here are some metrics you might want to track with regards to absenteeism.

If USDA’s eligible teleworkers were absent 3 less days a year, the savings would total over $90M a year.

Continuity of Operations (COOP)

Don’t forget to measure the value of telework on Snowmagedden days.

For USDA, if those eligible teleworked on just one COOP day a year, the savings would total over $30 million a year.

Transit Subsidies

While it’s a minor impact compared to some of the others benefits, with transit subsidies at $245/person per month, they do add up.

Assuming two-day-a-week telework among USDA’s eligible teleworkers, the transit subsidy savings would add up to $10 million a year. Already, their 10,000 core teleworkers are saving nearly $2 million/year in transit subsidies.

Healthcare

With healthcare running about $10k per federal worker per year, a 1% drop in costs among USDA’s eligible teleworkers would yield about $5M in annual savings.