Remote Workers - Is Yahoo on Track?

6 Mar 2013

In this Industry Buzz podcast, UCStrategies addresses the recent decision by Yahoo! to rescind the option for its employees to work from home. The team discusses the thoughts behind the new policy, and shares best practices from their experience implementing unified communications to allow for exactly this type of work arrangement to be effective and productive. Phil Edholm moderates the conversation, which includes UCStrategies Experts Marty Parker, Dave Michels, Don Van Doren, Art Rosenberg, Jon Arnold, and Steve Leaden.

Unified Communications Strategies

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Phil Edholm: Hi, welcome to the UCStrategies Podcast for this week. This week we are going to talk about a new and controversial topic that's happened in the industry. Last week Yahoo announced that they were going to change their policy and strongly discourage workers from working remotely, or from home. In other words, really making it mandatory as an employee - you need to come to the office on a daily basis. This is a major shift in strategy and philosophy for Yahoo, but really signaled the beginning of a real debate in the industry about the implications of remote workers, teleworkers and the technologies provided and the effectiveness of the individuals. It has sparked a debate about whether teleworking (remote working), makes people more effective in terms of their ability to work and create and contribute, or actually makes them less effective. The UCStrategies experts this week are going to address this question both from the technology implications, because obviously one of the goals of unified communication and the collaboration tools that our industry is building is to enable people to work remotely and be effective. But also from the other side, which is in many ways the question that came up out of the Yahoo announcements, which is more around management: how do you effectively manage over distance with people remotely?

With that, I would like to hand it first to Marty. Marty is going to talk about management effectiveness and the culture and why some of those changes might have been appropriate at Yahoo rather than the technology implications. Marty, off to you.

Marty Parker: Thanks, Phil. Fascinating debate that's come up around this move by Marissa Mayer, the new CEO of Yahoo, who comes from a Google culture - lives in San Francisco, drives down the peninsula to Mountain View when she worked for Google. So she's used to the concept of going to the office. Clearly, to me anyway, and this has been where many of the debates have gone, it comes down to a cultural question for Yahoo. The term that has been used in the financial press and so forth has been "serial innovation" - that Yahoo is in a battle against Google and Apple and other companies that are serial innovators, and serial innovation requires physical presence. Now, I am not quite sure that's true, but Marissa Mayer needs to change that company so much that these kinds of activates are going to be used. I think that she probably will get some benefit out of that move at Yahoo because it's going to shake up the culture. People have said she is just trying to get rid of people, etcetera, etcetera. I don't think that's true; I think she is trying to save the company. And good luck to her. I hope she does.

But I think it leads to a conversation about what are the roles of the people that are contributing to the business? Are the roles such that they really need to be in some face-to-face dialogue? Is there any reason why you can't accomplish that in a persistent meeting room, or a collaborative workspace or a Google Hangout, or whatever? Is there a reason you can't do that? I think that goes back to more of a culture than a technology question. I'm sure it can be done based on some personal experiences, but it means that everyone who is involved has to commit to doing it. I think the same is true if you are sitting in a cubicle in the office, by the way; you can choose to always appear to be on the telephone or always appear to be busy and not contribute; you can not go to the water cooler, etcetera, and that will be an interesting question as well.

I think this goes to two other questions that we see in our consulting work with clients. We have a number of clients that are trying to move people out of the buildings because buildings are really expensive. You can look on the internet and you will find out that establishing an office for a person in a major metropolitan area costs $6,000 dollars per year for the company. Let alone the cost that the employee spends in commute time, gasoline or public transit costs and so forth. I think there is an economic interest in not having people travel to a physical center. Maybe if you have a really high-leveraged collaborative environment that's producing serial innovation, the payoff is worth that cost, and that's the kind of decision that has to get made. But I think that will lead back to what role the person is trying to fulfill.

The other thing that I would say is many companies, and we had a major engineering firm that was on the same thing, they felt it gave them better access to resources. That if they could set up a culture that allowed remote participation, they could attract top-notch resources from around the globe, and they do. Even though they are U.S.-based, they have operations in Asia, South America, Africa, and Europe, and they want to be able to recruit talent and bring talent onto a project from wherever that talent is at the moment even if it's in a different time zone. So it's not called commute from Dusseldorf to Kansas City, you are going to basically need to be online and get that collaboration done in that way.

I think that the way that management needs to deal with this, and in the end I believe this is a management question as much as a technology or an employee question, is to provide some method that will inform the culture: measurements and feedback. It is amazing to me in this day that with all the feedback loops that exist in contact centers, that nobody is really using the feedback loops that are available within unified communications. There are tools there, some of them are packaged products, some of them are just the data that exists within the various vendors' platforms, but it doesn't take long with Crystal Reports or some other tool to turn that information into feedback. Sooner or later the companies that break through and manage to give feedback and measurements to their people are going to get the performance. In the end, it is all about delivering results. I think that Marissa Mayer and Yahoo have put the topic on the table. Hopefully we can help lead the conversation, pick up the conversation and turn it into results. Thanks, Phil.

Phil Edholm: Thanks, Marty. It's interesting your discussion there brings up this very interesting point that innovation often is one of the reasons we talk about people needing to be together. But I think it's important to realize there are two kinds of innovation. There is what I would call "structured" or "planned innovation," and then there's the more casual innovation of opportunity. I think very much that planned structured innovation can be managed, but I always remember back in the 1990s in the early days the network industry all the networking companies used to have Friday beer busts. I would argue that a lot of the innovation in the Silicon Valley networking companies in the '90s came out of those beer busts because essentially employees that never talked to each other (during the rest of the week), on Friday would come out and have beer. It was a very specific event for a very specific short period of time; maybe Yahoo having a Friday beer bust instead of requiring everybody being in the office all the time would be a better answer.

The other side of this, and you brought it up, was management. I often think that there are four levels of management. There are people who need supervision, they need to be managed and supervised on a daily basis; told what to do. There are people that need management, you can tell them what to do, talk to them about doing it, and they can manage themselves for a period of time. There are people who need direction; you can tell them what the goal is, give them some ideas, but they'll build a plan to complete the goal and just need direction of where to go. Finally, there are entrepreneurs, the people who can figure out what the goals are. Interesting framework to think about people.

One of the things Dave Michels believes is that you have to be very cognizant that you are getting a false sense of supervision because people are in the office and talked about how this being in the office may actually not be the right answer to effectively managing people. Dave, take it away.

Dave Michels: Thanks, Phil. Very similar comments to what you and Marty have already said. The knowledge workers are tricky. It's easy to supervise, let's say, painters. You can casually look over every 20 minutes and see if they are making progress painting. It is pretty difficult to understand or to supervise knowledge workers. How do you know if a novelist is actually making progress on their novel? How do you know if any type of knowledge worker, which is basically staring at a tube all day, is actually getting things done? Unfortunately a lot of us don't realize that distinction. So we're accustomed to the painter model, and if I can see you sitting at your desk, then you must be working. More and more that model is not very effective. I think asking knowledge workers to come into the office to work is somewhat suspicious, and many organizations need to reexamine their metrics for productivity.

In some cases, things like call center agents or claims processors or whatever, where there is a high degree of transactions taking place, there are fairly defined metrics, and that's easy to do and that's probably one of the reasons why we have seen a lot of call centers move their agents to homes. In non-transactional work, it is much trickier and we have to really think about the output and the measures of success and the output and measures of productivity. Once we define those output and measures, it shouldn't matter so much if the people are in the office or remote. Now, part of being in the office is the benefit of easier collaboration where people can talk to each other with ideas and share ideas and that takes place everywhere from the lunch room to the water cooler to conference rooms and even cube chats. But those types of collaboration forums are adapting, and that's what we are seeing a lot of in the UC space where people can work really effective through IM and video conferencing and even email and shared documents online and things like that.

While Yahoo has been talking about the gains and productivity that people have when they come into the office, there is probably some truth to that. I also want to balance that with the cost, because office space is not inexpensive and a lot of employees are unwilling to make that commute, so you are limiting yourself to who you can hire within the local footprint. You have the rent dimension, you have HVAC, you have all kinds of facilities costs. So if we assume for a moment that there is no such thing as 100 percent productivity and that we can strive for an improvement in productivity in the office, we really have to measure that cost of improvement by the cost of actually having everybody in the office; it's significant. Many organizations are unwilling to commit to teleworking that much that they downsize, but many organizations are - downsizing facilities, downsizing their office space and beginning to recruit people from abroad or non-local. There are some significant strengths and benefits to that proposition that need to be part of the equation. Those are my thoughts, Phil, back to you.

Phil Edholm: Excellent. Outstanding thoughts. I reflect on a couple of points from your thoughts. Living in the Bay Area and having commuted from where I live to silicon valley for a number of years, literally to a building that is within a thousand feet of the Yahoo buildings, I can tell you from my house to Yahoo to plan on getting in in the morning at a specific time would be an hour commute in the morning and an hour at night, maybe forty-five minutes to fifty minutes each way. So that's two hours a day times 220 a year is 440 hours in the car. If I am in a job where I am not heavily able to drive in the car, use my cell phone, interact with people that's basically 440 hours that are really lost for both myself and my employer. I think it's a very interesting thought process to think through. I agree. While Marissa, driving from San Francisco to Silicon Valley, has lots of opportunity to talk on the cell phone to people on the east coast in the morning and Asia at night. But not necessarily for a worker who does not have people they are working with in those locations who really would just be interacting essentially with other people driving on their commute to work.

One of the things that is actually very interesting about this is we have a model over the last 12 years of an industry that had a very major change in remote workers. That's the contact center industry. About 2000, we started doing VoIP, and I actually went to Matrix Marketing in Omaha, Nebraska, met with them, and talked to them about using voice over IP for remote workers. I was told, in no uncertain terms, that in the contact center, remote workers didn't make sense because the way they managed was by people walking around and managing their workers. If we look at that industry now about 12 years later, we find that a significant percentage of the workers are remote workers. I think Don Van Doren has some real good insights into how that change happened and how we can think about applying some of the lessons learned there to the industry at large. Don?

Don Van Doren: Thank you very much, Phil. I think clearly call centers are shifting in terms of how they are doing this, how they are accomplishing it. Obviously, one of the key questions and one of the key stumbling blocks early on in this whole thing was how do we manage these workers? Yet as Dave Michels pointed out, I think transactional kinds of activities are the sort of things that work very well or can work very well in this kind of an environment.

One thing I think is important to remember though, is that management isn't just watching and seeing that people are getting things done. It's also leading, setting a culture and it is also coaching and especially in the contact center environment, those particular aspects are especially important, I think. The management, by walking around approach, frankly was more about the coaching side of things within a call center. I think that the way companies have approached this is by really looking at specific kinds of individuals. What we have seen quite often in companies that are starting to use more remote workers as contact center employees, is many times companies will start with more experienced members of their team and actually offer this as a benefit for those people that really are on board, well understanding of the corporate culture, that don't need the kind of hands-on coaching that maybe newer contact center staff will need. Many companies have seen real benefits of doing this. One of the other things that has happened, of course, is that as workers in contact centers sometimes need to retire, maybe they have other responsibilities at home, caring for children, etcetera, companies are starting to figure out rather than lose this trained valuable resource we can put them to use in a home environment and it has worked extremely well. One of the ways that works frankly is that many companies are using these kinds of people to fill in on split shifts or other kinds of work schedules that would be very hard to accommodate if you are just relying on onsite people. Those kinds of things we think have really worked very, very well.

We have even had, of course, some companies that do it exclusively that way. Jet Blue was an early example of companies that all their contact center workers work from home. We even have outsourcers, there was a company called Willow that is now named Arise, that company again is an outsourcing firm but all of their agents I believe are still on a remote basis. Clearly, it's something that is working well. What is happening is that we are figuring out ways to manage these kinds of workers on the measurement side and as Marty said, there are plenty of tools within the unified communications suite that can do something similar.

I would just like to make a couple of other comments. I think this whole question about remote workers, there may be a generational component in this, too, in terms of how people best work and collaborate. We are growing a whole new generation of workers who are emerging with a very different set of tools that they use all the time. We have heard stories about people that sit in cubes next to each, busily texting each other rather than getting up and walking around the corner. It's kind of a joke, but on the other hand, think about it - what we are starting to do is have people that are very comfortable with that kind of working environment and given some of the new tools we have in unified communications and collaboration capabilities, I'm not surprised that we are going to see a major shift in this area.

That frankly points to another thing. I think one of the megatrends we are seeing in business in general is the growing use of independent contractors. As Marty said if we want to find the best people, wherever they are in the world, we can't always expect them to move back to one of our offices. Dave mentioned the key issue is how do we create management styles and tools for the effective leading, managing and coaching of these kinds of individuals? I think it's a great challenge and I think there is a lot of really good trends going on in this way. Yahoo, not so sure; I think as Marty said, maybe they are just trying to shake up their culture and maybe that will help. I don't think that's an overall trend that is going to work.

Phil Edholm: Art Rosenberg, you added some comments also in the contact center space about some of the lessons learned as well.

Art Rosenberg: I want to endorse what Don was saying. Over the last I would say three or four years, anytime that I was talking to somebody in a contact center on personal business or whatever it is, I would always ask them - are you working from home yet? Ninety-nine percent of the time they would say, "I wish." Then lately a few people have said, "I am working from home," or "we're starting to work from home." So you can see there is definitely a trend that from the perspective of the employee they sure as hell want to do it. As you said before, what is management's concern about managing people who work from home? I think with the kind of big data and putting things in the cloud, watching everything that everybody does will give you the metrics for knowing whether people are productive or not.

Another interesting story: this is way back in the early days of Delphi, we were creating the first call center, and I was responsible for managing it and training the operators and so on. Then when they asked what kind of data we wanted to collect, I said I wanted EVERY action, because I didn't know what I wanted. When we got all the data, we were able to track everything, every call that came in and so on. Then I did a rundown to see performance of the agents. The people that I knew were very good were right up on top, but number three was a trainee, somebody who was brand new and was handling all these calls. I thought that something was wrong. I went in and looked at the data and I found out for whatever reason she accidentally was hanging up on every call. She was completing all the calls by doing nothing. Having that kind of data, seeing what's going on, is the way you supervise, not necessarily being there. As far as the coaching goes, that even can be done remotely so these are all issues, but they can now be done a lot better with the technology that allows everything to be done and access the information from anywhere. Look at the cost of commuting and doing things to the environment. It's just not worth it or affordable.

Phil Edholm: Excellent points. As a side comment, I spent a number of years where I was in California, and for 10 years, the person I worked for was never located closer than Dallas, and 95 percent of my staff to 98 percent were located somewhere else. One of the things I found was that the concept of management by walking around actually has a virtual equivalent - management by "calling" around. It started with audio and transitioned to video, to actually talk to people, not when you had a scheduled one-on-one, not when it was a meeting, but when you had a moment, calling someone unscheduled, just having a conversation...much as you would if you met at the water cooler when you walked into their office. What I found is if you repeat this, the first couple of times, someone says "why are you calling me?" They're worried that you want something. About the third or fourth time, when they realize you are not calling because you have a task to do, there is a specific activity, but rather you're just calling to see how it's going, what are you working on, what is exciting today... it actually changes the relationship. I think these are some of the things that people who have not worked virtually who understand how to manage virtually, don't do, and therefore are ineffective.

I think that brings us to Jon Arnold. He is going to talk about the generational issues and what the expectations are of some of the younger folks around remote working.

Art Rosenberg: Phil before you go to Jon just let me make a comment as far as what you just described. Doesn't chat allow exactly that type of capability?

Phil Edholm: I have to say that I found that it was good with audio, but it is better now with video because you actually are about building the personal relationship. As a manager to an employee, especially an employee who is not supervised, where you are saying "do this, this, and this," that's something you can accomplish in a lot of different ways and model in a lot of different ways. But the person who is a product manager, for example, who is working, doing a lot of coordination, is more managed by objectives than outcomes...having a conversation with them that's kind of check-in, where it may even be social. You start off by saying "how's the family?" But the same conversation you would have if you met at lunch and sat down together just because you happen to be eating at the same time. I think actually realizing that you want to have those conversations and as a manager making sure you do it. If you don't do it the employees will not do it, they will not call you. If you call them, what they realize is that it's a different kind of interaction, it's not scheduled. Over time, they really look forward to it. I would suggest that there are some ways you could both manage by objectives and manage by calling around to make things effective.

With that, Jon, you are going to talk a bit about the younger generation who has grown up with these technologies. I know with my kids, I would watch them on six different chats and doing their homework. One time I asked my son, "when are you going to get together with your friends?" He said, "I am together with them all the time." I said, "but you're sitting in your room by yourself," and he said, "I am not by myself." You obviously have some thoughts and the perception of what the younger generation is expecting at work.

Jon Arnold: Thanks Phil. A flavor of this has already been covered. We have had a lot of people touching on various aspects. I will just add a couple of other thoughts. For me, if there was ever an audience or an application where UC was meant to be invented it was for the remote worker. I mean, it is really the best toolbox you can have to have that virtual experience, yet still be connected. I think this is a bit part of where video is going to really find a home for remote workers because it allows them to be as engaged as they could possibly be on a remote basis. For the generational point of view, of course it is all about work-life balance. The thing there is that the work styles of younger generations, you hear about a lot of people going to school and having no job, etcetera. The expectations of career paths are very different today than it was for us, or for another generation before. Very much their careers are very nomadic. A lot of younger people tend to work from company to company or even job or project to project. So many things now are project oriented where there is not a long-term career path. HR people will tell you their mentality is so different. Because full-time opportunities are not there, this is one of the better ways they can actually put their skills to work and obviously, by having all kinds of resources out there people can bid on jobs for freelance work, etcetera, and do a lot of things very well from home. It cuts both ways, because it gives the tech-savvy generation more opportunities to generate work on their terms and not be co-oped by the corporate career path which a) there is no opportunity, and b) the more they get conditioned to this way of life the more that becomes the norm and that's what works for them.

Of course, for the employers it is a boon because they do not have to hire people full time and pay benefits and pensions and all the things that make for companies a lot of problems financially, and it lowers labor cost. It also of course gives those companies a broader pool of labor to draw from. I think it can be done in a win/win way. As far as the quality of work and productivity I think that can be very suspect. I think the broader picture is in the global economy where you have to sell service and support, customers on a global basis you have to be able to draw employees the same way. I think that is really the attraction for remote workers from a business management point of view. Of course, that means that people working at home have more opportunities as well.

Touching on the contact center by the way, one thing I never hear people talk about that I think is one of the really neatest things about remote working is that it broadens the labor pool for people who normally cannot get work. People who are housebound, they could be seniors, they could be people with a physical disability who cannot get out of their house but still have skills. Someone mentioned earlier we are in a knowledge-based economy and I think there are very important and valuable segments of the general population that are computer connected enough that if you gave them the right tools and opportunities they could be doing all kinds of interesting things. Of course that also plays well for employers who are looking for ways to engage a broader demographic of people on their payroll or on their teams. I do not see that being taken advantage of enough but I think the tools are all there and I think the opportunities could be fantastic to draw a broader range of people to the workforce. I'm sure we all know people who have been retired for years who are looking for things to do and have a lot to give and this could be a great way to do it if they really put the pieces together.

Phil Edholm: Excellent. I think Steve Leaden, you were going to talk a bit about defending the remote worker and why remote working actually makes great sense.

Steve Leaden: Yes, thanks Phil and thanks to everybody for sharing so far. I think there's been some great input today. It's interesting - I read a little bit about Marissa Mayer's point of view and why it's being driven. It appears as though she is really using Apple, Facebook, Google and others as a baseline, very specific to Silicon Valley. For example, she is looking at a productivity study drawn from one resource and showing that Apple's employees produce six and a half times more revenue per employee than hers; Facebook, three times more; Google is twice the revenue. All three companies appear to have a brick-and-mortar kind of approach. I think that is probably one of the biggest reasons why that is driving her into this venue and her opinion, if you will.

Yet at the same time, not every company out there is a silicon valley-based technology-only company and there is much more far reaching avenues that are available to all companies across the board. One of the things that we are finding in our consulting practices is everybody that we interview when we start with a new client and a needs assessment, everybody has some level of remote worker interest, especially when it comes to the contact center, to Don's earlier points, and some of Jon Arnold's points, definitely, there is great enthusiasm around reducing real estate costs, to Marty's earlier point, and getting knowledge workers across multiple geographies.

The one major theme about remote workers in general, or working from a remote site, and typically that's for a home worker, is that really there is no more a geographic boundary. Literally you can run an entire corporation and we really see all of the major telecom carriers and all the telecom and IT-related premise-based companies really share in this model that their project managers can run remotely from Dallas, or Seattle, or San Francisco, it doesn't really matter. They can run a national project and literally have engineers troubleshooting and implementing voice over IP and UC tools from anywhere. It creates an availability for these people to work remotely and do these implementations from multiple sites. They could be in Atlanta one minute, they can be in New York the next minute and in an hour they can be in San Francisco. You don't have that kind of flexibility when you are working in a brick-and-mortar environment.

Let me share with you a couple of statistics from some studies that are quite interesting. There is definitely a defense for the at-home worker. Numerous studies have proven that people are more productive being remote workers, and telecommuting cuts down on traffic during peak hours. It reduces a company's real estate costs. It improves employee morale with less turnover. Now again, you have to have a whole company policy written around that, and I think an occasional hotelling of individuals to come in and be back in the office is not a bad thing either. Continuing, 10 percent of American workers spend at least one day a week clocking in from home, according to government data. The percent of people working exclusively from home has climbed to just under 10 percent in 2010 and up from just under five percent in 1997. There is definitely a trend upward.

Then Stanford University and Beijing University provided some compelling evidence that benefits both employers and at-home workers. To Don's earlier point about travel agencies, there was a study done recently for a Chinese travel agency and proved that at-home workers were noticeably more productive, spending nine percent more time on calls; handling four percent more calls per minute, and workers were sick less often and reported being happier and quit less frequently. Again, I think there is a lot of benefit to working through all of those.

What are the tools? We have been talking about UC and collaboration. If you just reference some of the basic tools that are out there, you can enable a remote worker via a soft phone or via an IP hard phone and they can have an extension just like in the office. You can have one number, follow me, reach me mobility via follow me, twinning and other kinds of elements. You can have IM, chat, and presence literally bringing people together across multiple geographies. You can schedule meet-me conferencing and send an invite to participants via a single UC interface. You can have unified messaging across all borders. You don't need to be near a fax machine, you can get your faxing in your email box now; you can get your voicemail via your email box now. You can connect colleagues on the fly with again, presence and IM/chat tools and calendaring and conferencing. When you think about it, how many of us at least once a week are on some kind of meet-me conference call and in many cases web-based, where you can connect via a white board or document sharing session within it. That is very standard practice in today's market.

Really at the end of the day Phil, what I am seeing is there is a value to being onsite. But I think there is a greater value in the assessment of having workers work remotely, the reduced real estate costs, better personnel, happier personnel, increased hours working, and really the removal of all geographic boundaries, creating a virtual corporate approach. One last example here: we are actually in the midst of deploying a 7,000 end point national client, fifty-five sites and the entire project is going run remotely with 20 of us working virtually from New York to California to Seattle to Canada down to Florida. Then there are guests that come in depending on what site we are cutting, and we are all running this entire project; everyone is working remotely either from their home or sometimes from an office, but very rarely; but we never see each other. It works quite well.

Phil Edholm: Excellent.Art you had one final quick comment.

Art Rosenberg: Yes, what was just discussed, which I think makes a lot of sense by Steve, is all the tools for communicating between people. One thing we are forgetting is that all the information we need, and maybe even more than we need, is available online no matter where you are. So put those two pieces together, you get access to the people, who you want to work with whatever relationship there is, and all the information you need all can be done remotely. What's left? And you can be supervised obviously, remotely. Those are the three big pieces for where you work, forget for the moment what you do, but how can that be managed?

Phil Edholm: Excellent. Thanks to all the UCStrategies experts for their contributions. Just to encapsulate, I think we heard two things today. The first is that remote workers can be an incredibly effective asset and mechanism for companies. But today is really the time to consider the tools both for the best way for folks to work remotely, the best ways to use those tools to enhance your management capabilities, and also how to help your organization culturally manage remote workers. I think what you heard today is that there is no place better than the UCStrategies experts to start with how to make your organization effective in terms of remote workers.

Finally, I guess we will close with the comment that we will need to revisit this whole session a year from now where we can evaluate whether Yahoo has been effective and whether Marissa in fact has turned around the slide of one significant company in the Internet world that has to a great extent slid into being essentially unimportant at this point, but is obviously looking to come back. With that I would like to thank all the UCStrategies experts for what was an excellent podcast on remote working, is it really meeting its promise or not? Thank you.


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