Is the Tide Turning on Telework? Tech companies in Silicon Valley are often note

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Is the Tide Turning on Telework?

Tech companies in Silicon Valley are often noted for their generous employee benefits, such as providing free meals for workers, allowing dog owners to bring their pets to work, and offering flexible working hours, including support for telework from home. The goal of these policies is to encourage workers to put in longer hours at work or to work more productively. Thus, it came as a surprise when Marissa Mayer, newly appointed CEO of Yahoo!, directed her human resources chief to send out a memo to all employees that essentially put an end to flexible work hours and the ability of Yahoo! employees to work from home. The memo said in part: “Speed and quality are often sacrificed when we work from home. We need to be one Yahoo!, and that starts with physically being together.” Yahoo!’s move is an attempt to improve collaboration and to become more competitive.70,71

The change in policy came at a difficult time for Yahoo!. The firm went through four CEOs in five years, and industry experts had been questioning Yahoo!’s ability to develop new and innovative services. Many have also questioned the quality of its workforce.72 After Yahoo!’s earnings were announced on April 17, 2013, shares in the company fell more than 3 percent on news of a decrease in sales of display ads.73

The ban on working from home drew both sharp criticism and praise from industry observers and employees. On the negative side, management consultants and authors Jody Thompson and Cali Ressler believe the policy change is a major mistake and that Yahoo! will end up with workers who earn good work attendance marks but are not effective and efficient at meeting company goals.74 Jennifer Glass—a sociology professor and research associate at the Population Research Center at the University of Texas, Austin—points out that the United States already trails other industrialized nations when it comes to providing flexible work arrangements. Sir Richard Branson, billionaire business magnate and founder of Virgin Airlines and Virgin Records, said Mayer’s policy was a step backwards “in an age when remote working is easier and more effective than ever.” Another professor felt that the changed policy could further lower employee morale and hurt recruiting efforts.75

Supporters of the new policy include many who believe that employees are more productive in the office. Just prior to Yahoo!’s announcement, Patrick Pichette, CFO at Yahoo! rival Google, had pointed out that his firm believes strongly in employees working physically close to one another to encourage collaboration.76 Perhaps encouraged by Mayer’s announcement, just one week after Yahoo!’s change in policy, Best Buy informed its headquarters employees that its flexible work program was canceled and that it expected employees to work a traditional 40-hour week at its headquarters. The need to collaborate and work together in turning the company around was given as the reason for the change in policy.77

Discussion Questions

1. Do further research on business results and employee morale at Yahoo! to develop an opinion on whether the ban on telework has helped the firm. Write a paragraph stating your opinion and providing supporting facts.

2. Should telework only be considered a “perk” for those companies and employees that are already producing good business results? Why or why not?

3. Imagine that you are a member of a firm’s human resources group trying to decide whether or not to support telework. What factors would you consider in making this decision? What process would you follow to arrive at a decision that could be accepted by employees and senior management as well?

4. What are the ethical dilemma related to this case study?

Explanation / Answer

Yahoo was going through difficult time when Marissa Mayer joined the company.
Yahoo had went through four CEOs in five years, and industry experts had been questioning Yahoo!’s ability to develop new and innovative services.
Yahoo CEO Marissa Mayer then directed head of Human Resources to send out a memo to all employees that essentially put an end to flexible work hours and the ability of Yahoo! employees to work from home.
The idea was “We need to be one Yahoo!, and that starts with physically being together.”
At that point employee morale at Yahoo went down, many felt demoralized and this hypocrisy increased the self-imposed pressure on the best Yahoo employees who work at home to find jobs at companies that will accommodate their schedules. Mainly working Mothers were the most affected by this.
Brad Harrington, executive director of the Boston College Center for Work & Family, notes that people who work from home tend to have less stress and are more productive, partly because they don’t invest time and money in commuting and also because they can balance their personal and work lives.
So logic suggests that when Yahoo's current at-home workers are required to drive into its offices each day, they'll be more stressed out and less productive.
Yahoo's work-at-the-office policy will mean more people driving, that number could range from several hundred to many more who work one or two days a week from home. And more commuters mean more traffic and more air pollution.
Unless Yahoo already has cubicles in place for all of its employees, ending its work-at-home policy means that shareholders will fork over more money for fixed costs such as real estate, telephones, and all the other costs required to house employees during the day.
All predicted failure of this policy, but Julie Ford-Tempesta, Yahoo’s senior director of real estate and workplace in his statement in a paper presented at CoreNet Global Summit in Las Vegas that “employee engagement is up, product launches have increased significantly, and agile teams are thriving,” adding, “The workplace has become a catalyst for energy and buzz.”
In the report, Yahoo’s Ford-Tempesta points to the near-doubling of the stock price since the beginning of the year, an assertion which is dubious at best considering how much of that value is tied up in the company’s 24% stake in the soon-to-IPO Alibaba, while its third quarter revenues and profits are both down compared to a year ago.
There is definitely merit to the idea, however, that bringing its agile programming teams together in the same place at the same time can have a small but crucial impact on performance. In his book People Analytics, MIT visiting scientist Ben Waber discusses the role of dependencies for programmers, that teams must coordinate closely to ensure their code meshes well. Citing others’ research as well as his own, Waber argues remote programmers are 8% less likely than co-located groups to communicate about dependencies, which translates to 32% longer code completion times–or death when you’re already as lumbering as Yahoo. “For Yahoo, then, this means their workforce becomes about 3% more effective with the stroke of a pen,” Waber wrote, the value of which he pegs at $150 million.
My opinion is Work from Home should be allowed for employees that do not have any dependency and for others it should be based on case as it is at Google.

2. Should telework only be considered a “perk” for those companies and employees that are already producing good business results? Why or why not?
No Telework should not be considered as a "perk" for those companies and employees that are already producing good business results because they have reached this level and given good business results because they have worked hard at office and built a strong base on which they are growing.
Spending time at office, interactions, brining new idea which leads to new business.
No company can surivive for long with same work, newer innovtions are needed at every moment this comes when lot of minds interact.

Any policy we bring in should always be for betterment of Company.
For Tech Company Yahoo, Its Employees are its assets.
This Telework policy affects all its employees, i support this policy because we are talking about "We need to be one Yahoo!, and that starts with physically being together."
This policy is being brought so we can develop and deliver products faster to world, lot of pressure on company not being able to compete with others.
On one hand i have business,growth and competation, on other have we have issues such as more pressure, stress on employees because of they need to travel to work.
I would balance out this way, the employees who needs work from home(these employees are pregrent ladies, who need to spend some times with the children after birth and others) will get it.
Rest have to come to office to work so business does not get affected, if business get affected and we do not have enough profits, paying salaries will be tough and everything will get affected.
But if someone really feels he has to work from home, let his manager and team decide that depending on the case.

4. What are the ethical dilemma related to this case study?

Ethical dilemma related to case study is on one hand we say "people are more productive when they’re alone and work from home", and on other "they’re more collaborative and innovative when they’re together".

It is not like Marissa Mayer does not want employees to work from home, but business situations in which the company has got now is forcing her to take this decision, so they can change the fortunes of the company.
Again the dilemma, should i change what i allowed because of slow growth and this could affect all my employees, their health and their life.
Ethically i would say No, but this is business so i would bring this policy.

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Is the Tide Turning on Telework? Tech companies in Silicon Valley are often note

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