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Remote Working and the Virtual Office

For me, July 17th, 2009 was an incredible day…it marked the last day that I would ever spend working in an office.

Yup, that’s correct. For almost a year I have been a remote worker, working quite literally from a virtual office (my office consists of an Acer netbook, a Sprint MiFi cellular router, an iPod Touch and my HTC Mogul). And, bar none, it has been the best year of my adult working life, not to mention the most productive!

Let’s begin with a story: Once upon a time, long long ago, there was this little thing called the industrial revolution. Perhaps you’ve heard of it? It involved factories, lots and lots of workers, and brilliant leaps in efficiency. It completely transformed our country, our economy, and the world. Unfortunately, it had some negative side effects.

You see, along with the industrial revolution came the near universal concept of shifts, aka the evil 8+ hour day and the 40+ hour workweek. Who exactly decided that this was the way it should be? I don’t know, but whoever it was, I expect there is a particularly nasty corner of hell reserved just for them 🙂

This concept, the 8/40 deal, has remained essentially unchanged for the last 200 years or so. That’s right, despite the fact that technology has completely changed the working world, and despite the incredible efficiency that said technology has created, it still somehow magically takes 8 hours per day, 5 days per week to do your work. Doesn’t that seem a bit odd?

Actually, not only is it odd, but it is a complete load of crap. Studies have actually shown that most employees only work, really work, between 3 and 5 hours per day (less on Monday and Friday). And, on top of that, very little of that time is actually spent efficiently, without meetings or interruptions, working on important work. As Pareto would put it, 80+ percent of the real work an employee is doing comes from 20 percent or less of their time. So that employee you think you are paying $20/hr may really be making closer to $100/hr in terms of time spent working effectively.

Enter the concept of remote working.

You see, despite what some employers may think, when you pay someone a salary, or by the project, you are paying for results, not hours. If it is possible to meet or even exceed your required goals and responsibilities in 1/10th the time expected, what’s wrong with that? In my mind, it is up to the company to determine what a fair amount of productivity would be from an employee compared to their salary, and then be happy with quality and productivity equal to or greater than expected, regardless of the time put into the project(s). Time isn’t money…results are money.

Oddly enough, there are many employers who agree! Best Buy, for example, has instituted a ROWE (results only work experience) for all of the employees at its corporate office. They can work whenever and wherever they want, so long as their output and quality meet or exceed a certain standard. Unlimited sick days, unlimited vacation days. No schedule, no office. Just good old fashioned work.

As a result, their productivity has increased, employee happiness and morale has increased exponentially, and the company is better off as a result. Less hours, less money spent, and more profit…isn’t that every company’s dream?

In our connected age, an office is usually a waste of money. Perhaps a few examples would be in order:

  1. Meetings – I can tell you from ample experience that there is rarely if ever a good reason to hold a meeting. A detailed email is almost always going to be more effective and efficient. If you absolutely need a face-to-face, you can use Skype. The video and audio are excellent, and Skype to Skype calls are totally free. No traveling, no building necessary, but a meeting all the same. Make sure to have an agenda to avoid wasting time.
  2. Project CoordinationGoogle Docs, Basecamp, and a private wiki are all excellent options. There are numerous tools to track billable hours spent on a project, such as Rescue Time. You can securely share files with co-workers and clients through Dropbox (2gb free). You of course also have email and Skype as additional options. If you are worried about productivity cutting into billable hours, assign tasks a set hour value, and bill accordingly. That way, efficiency=higher margins 🙂
  3. Phone Calls and Call Centers – Aside from numerous outsourcing options, you can use Google Voice to forward one or more virtual company numbers to any number of other phones. Skype does the same thing, and it’s either free or very cheap. Google Voice can record a call, transcribe a voicemail, and more. Both can forward to cell phones or landlines almost anywhere in the world.
  4. Security Issues – I take security very seriously, so my computer has a difficult password, all client data on my machine is encrypted, and a backup is stored in a secure online Dropbox. I never access the internet through public WiFi spots, instead opting to use my own Sprint Cellular Router, secured of course. I run the best firewall and anti-virus tools available (I highly recommend the Yoggie Gatekeeper Pico Pro), and use a virtual sandbox for any new programs and files just in case. My laptop never leaves my sight, at any time for any reason. I always work with my screen to a wall if I’m in a public place, to avoid prying eyes (you could also use a 3M privacy shield). My computer can even be remotely locked and wiped, should the need arise. Security really isn’t an issue.
  5. Corporate Address – Thank you UPS Box! You get a street address and a “suite” number, all for $20-$30 per month. Some office buildings charge more than that per square foot! If a client wants to meet at your office, let them know that your company is testing a virtual office in an effort to be more green and to increase both productivity and morale. Offer to meet at their office or a restaurant instead. Personally, I’ve never seen any backlash from this, and most clients absolutely love the idea! If you absolutely must have  a physical place to meet from time to time, of a more professional variety, try a Regus Virtual Office or a co-working space with a shared conference room.

The point is, there is really no reason to have an office. The ability to work fewer hours will motivate most employees to create more efficient methods of working, and in most instances to increase the quality of the work, all of which is excellent for the employer.

The employer no longer has to pay for a computer, an office, furniture, utilities, internet, phones, etc. All of that can be on the employee’s dime, which they are usually more than happy to pay for. IT, accounting, HR, sales, and most everything else can easily be outsourced, and any other employees have no real need for an office.

I’ve been doing this for almost a year, with no trouble whatsoever. My productivity has gone way up, the quality of my work is praised constantly, and I have the freedom to run errands and do what I need to do when I need to do it.

If I’m sick, I’m already at home, so no big deal. I see my wife more, which means a great deal to me. When we have children I will be able to spend more time with them, and actually watch them grow up. If I need a vacation I can get ahead on my work, and handle little things as needed from wherever I am or delegate the work to another employee.

I am of course available by phone and email during regular business hours, but that isn’t any inconvenience. I’ve still had 40-50 hour weeks when things were extra busy, but it usually takes much less than that to handle all my work and sometimes more. Clients are happy, I’m happy…honestly, from my perspective there are no negatives.

Save your company some money and do your employees a favor…offer remote working. There has never been a better time to do it, and your customers, employees (and shareholders if you have them) will thank you.

Happy Employees and Happy Customers Aren’t Mutually Exclusive

There is a disturbing trend amongst employers that has been going on for some time. In the last 12 months, thanks to the recession, I have seen this trend steadily worsen, and I believe it is almost at critical mass…I’m referring to a trend I’ll call Retailitis.

Retailitis happens when a business is vastly more concerned about the happiness of their customers than they are about the happiness of their employees. This is a fundamental flaw in many businesses, and one that if fixed would literally change the entire face of business as we know it.

Let us examine a few examples of this problem. I’ll start with my least favorite company in the world, Wal-Mart.

Negative Example #1 – Wal-Mart

Once upon a time, I worked at a Wal-Mart in American Fork, UT. At this particular Wal-Mart, while I was there, our employee turnover rate was over 90%. The highest I remember seeing it was like 95%. I remember being told that it cost between $3,000 and $4,000 to train a new employee, and there were roughly 500 employees in this particular store. Taking 95% and $4,000 and 500 employees, that comes out to just shy of $2,000,000 being lost each year to employe turnover. Ouch!

So the question is, why was turnover so high at this store? Because of the mentality of the management team. First, let me explain a few things. Salaried managers at Wal-Mart are paid pretty hefty bonuses if they reach certain revenue goals, giving the greedy managers very strong motivation to sell sell sell.

This translates into a slave driver mentality, where everyone beneath you becomes a means to your financial end, nothing more than tools. This was amply evident at this particular store. If my memory serves me right, our store manager, with his bonuses, was making roughly $300,000/yr. The Co-Manager was about half that. The average overnight employee, on the other hand, the best paid hourly workers at this store, were making around $20,000/yr.

Yet, in spite of this, this particular Wal-Mart store was growing significantly year over year, and was one of the highest revenue generating stores in the region last I heard. Unfortunately, this type of result tends to reinforce to management that what they are doing is both right and effective. Alas, what they were really getting was a “false positive”. Sure, the store was doing well financially, but the employee turnover was sky high, and both efficiency and morale were way down.

The reality is that by paying the hourly employees just a little bit more, combined with more positive reinforcement and less negativity from the managers, turnover would have decreased, efficiency and loyalty would have improved, and the store would have actually done even better financially, perhaps significantly so. Happy employees do SO much more for a company than the average company realizes. Unfortunately, few managers understood this, and so nothing was done to fix the problem.

Negative Example #2 – Teleperformance USA

Lets look at another example. I am acquainted with a supervisor at a local Teleperformance USA call center. They handle customer service calls for Verizon FIOS. The contract that this call center is under stipulates that they are paid only for the first eleven minutes and fifteen seconds of a call. Anything over that, and they are not making any money.

So, naturally, there is an EXTREME push for low call times. If an employee is on a call that is going too long, their name is written on a board, called out loud to the other employees, and otherwise criticized and publicly humiliated. This is supposed to help them improve. What this actually creates is an extreme conflict of interest.

It is now, under the above circumstances, in the employees best interest to cut their call times down. However, many of the calls at this center are very complex, and CAN NOT be handled in the allotted time.

The result of this is that the employees are coming up with creative ways to cut their call times, but at the expense of customer service. They will, as often as possible, refer the caller to their manufacturer, or transfer the call, or just plain drop the call, all to make sure they get yelled at less and have a higher chance of being promoted to a less stressful position.

This problem is not an employee training issue, but a management training issue. As far as I know, there is not a single employee there whose call time is under the limit who is not cutting corners. From what I was told, the very best employees there, those who don’t cut corners and are extremely good at their jobs, hover closer to 15 minutes per call, and are harassed continually about it, in spite of the fact that their customer satisfaction and first call resolution are very, very high. That is a serious problem.

In this particular instance, the real problem is that the contract between the call center and Verizon needs to be renegotiated. Go the Verizon and say, despite our extensive training, even our very best employees can not meet this call time limit without cutting corners and skimping on customer service. Here is the data to back this up. We need to negotiate a longer call time limit. Simple enough. It is in Verizons best interest to retain as many customers as possible, which they cannot do if the customers are getting poor customer service.

On top of this, the managers at this call center need to be taught some serious people management skills. Negative reinforcement is their tool of choice, and obviously it doesn’t work. You cannot tell an employee to do something that is literally not possible, and tell them their job and pay hangs in the balance, and expect honesty and effective work from that employee. Desperation does not a happy employee make. It just won’t happen.

In addition to that, everything at this call center is always in a rush. Everything is urgent, must happen right now, hurry hurry hurry. This reeks of poor time management skills, and an inability to plan properly and set realistic expectations. No surprise that this call center is one of the worst call centers this company owns.

I could go on and on about companies showing perfect examples of Retailitis, but that is not the point. The point is, how do you fix and/or avoid this problem? Simple! Put your employees well being ahead of your customers/clients. Sounds counter intuitive, right? Well, it isn’t. It works perfectly, and I’ll prove it.

Lets take a look at Zappos, and online shoe company, headed by The Wizard of Happiness, Tony Hsieh.

Good Example #1 – Zappos

At Zappos, happiness is at the heart of everything. Tony, the founder and CEO, want BOTH employees and customers to be happy, and has organized his company accordingly. For example, new hire training at Zappos is a multi-month affair, to make sure that everyone understands the culture and nature and mission of Zappos. At the end of the training, these new employees are offered $2,000 to quit, right then and there.

Most businesses would look at this as crazy, but it is anything but. Though many employees think they want great pay, what most really want is to be appreciated and work in a positive environment. Tony understands this, and employees at Zappos are both well paid and appreciated. By offering people money to quit, Tony makes sure that the employees are more interested in the culture and environment than the money. Zappos wants employees for who their work is more than just another job.

Beyond that, everything at Zappos is structured to make employees happy, from the work environment to the perks. Employees are authorized to transfer this happiness to the customers, which they do in abundance. Zappos is a billion dollar company largely because of repeat customers, which they have in droves thanks to their incredible customer service, a result of happy employees.

I could give more examples, but why bother? Zappos does it perfectly…just model after them 🙂

So How Do I Apply This to My Company?

Easily! For a business to reach it’s full potential, the happiness of employees needs to be a company’s highest priority. When your employees are happy at work, they become loyal and efficient. Efficiency is money. On top of that, of all the forms of marketing, word of mouth is still the most powerful, and is particularly meaningful when it comes from a happy employee who is sharing the joy not because they have to, but because they WANT to. Happy employees, when coupled with a good business model and a great product or service, will inevitably lead to happy customers, and long term profit and growth.

Do not give in to Retailitis! Regardless of whether your business is doing well or poorly, take a close look at your employee morale. Encourage an open door policy, where employees can discuss concerns with you without consequence to them. Keep your eyes and ears open. If you find that your employees are not happy, fix it! In this economy above all, nothing will provide a bigger boost for your bottom line than happier, more efficient employees.