Effect of Work from Home on Employee Performance

The frequency of working from home has been increasing rapidly majorly in the US and Europe. Globalisation is no longer restricting the companies from recruiting people from distant geographical locations. Technological Advancement has further contributed in this context (Bloom, 2014). This is because employees across the globe are now able to use technologies to communicate with their colleagues over the phone and through video call, irrespective of their geographical locations. It has been identified that availability of email over the phone, Skype of smartphone and Dropbox in laptop have made it possible for people to work anywhere in the world. Work from home has become an integral part the contemporary business environment and especially in the knowledge economy. This report sheds light on the merits and drawback of work from home and finally reaching to a logical conclusion.

What effect work from home has on employee performance?

Article 1- Yahoo CEO Marissa Mayer’s work-from-home memo is from bygone era by Emma G Keller (2013); The Guardian

Marissa Mayer, the CEO of Yahoo! has recently banned work from home for the employees of Yahoo! She believes that it is essential for the employees to work along with each other (irrespective of their hierarchical level) and that is the reason behind establishing offices. The reason behind this is that there are some ideas that come into mind while having an informal discussion in the cafeteria and during meeting with new people. It is not always that arranging a formal group discussion in the board meeting would result in effective decision making. She believes that the speed and quality of work get sacrificed when people work from home (Keller, 2013). However, her decision would restrict the employees of Yahoo! from enjoying flexibility. Moreover, there are high chances of a rise in overall expenditure of the organisation. Also, there would be no benefits for the employees with families and thus, would have a have a negative impact on their morale and motivation level.

Article 2- Teleworking: The myth of working from home by Margaret Ryan (2013); BBC News

Richard Branson, the entrepreneur of Virgin has criticised the move of the CEO of Yahoo! for banning remote working. He believes that, currently organisations are operating in the era where remote working is increasingly becoming popular. This is evident in the sharp rise in population of employees working from home in the UK (appendix-1). Branson further explained that technological advancement has made it easier for people to communicate with their colleague sitting at any geographical location. Most of the employees have broadband, smartphone and webcams that makes it possible to have face to face discussion while staying at distant locations. He believes that when there is scope for the employees to avoid travelling daily to their office then keeping the scope ‘un-utilised’ is of no use. However, Branson believes work from home would not be advisable for the employees working in the manufacturing sector (appendix-2).

Different Perspectives on Work from Home

Article 3- Heather McGregor: ‘Working from home is the future’ by Heather McGregor (2013); The Guardian

Technology has made the entire world a smaller place. It has made it even easier to combine technology and work. However, trust holds prime importance whether the employees work from home or office. Transparency and knowledge of each others are the key contributors to the development of trust. Once an organisation or individual gain positive experience in working with others, it is expected that the same experience would be gained in the future also. This indicates that trust needs to be earned, which is best possible through face-to-face interaction rather than discussion over the phone or through emails. Although the effectiveness of the decision of Mayer to rebuild Yahoo! is still not clear, there is one thing that is certain i.e. the need for developing trust. This would help in boosting the pace of rebuilding the organisation. Communication plays a vital role in the context of developing trust. However, technological advancement has made it difficult to develop such trust. This is because in order to develop the employeesthey need to work together physically and solve work related issues and success together. All these are very difficult if employees are working from distant locations. Therefore, it can be argued that the biggest disadvantage of work from home is that it restricts the organisations from developing trust among the employees. On the other hand, providing a scope for flexible working often becomes essential in order to enable the employees to create a balance between their personal and professional life. Thus, allowing work from home on occasions is beneficial. However, remote working during crisis situation would not be fruitful for the organisations.  For professionals with high level of skills work from home for relatively longer period can still be considered, but not for others. This is evident in the UK where above 23% of the professionals are in skilled professions (appendix-2).

Article 4- Alexandra Shulman on working from home: it’s not an adequate alternative by Alexandra Shulman (2016); The Guardian

It is believed that Mayer has negatively affected the organisational culture of Yahoo! by eliminating the option for work from home. This might be a strategy for reducing employee strength to minimise overall expenditure, this is actually not the issue. The issue is that in the current scenario professionals perceive ‘work from home’ an appropriate alternative for visiting office daily. Employees often request for allowing them to work from home and promise that this would not make any difference in their performance. However, seeing a work related instruction from the kitchen at home or sending an email while resting in bed does make a difference in employee performance. In order to work effectively, it is essential for the individuals having the office atmosphere where people working closely to meet targets acts as a motivation factor.

Merits of Work from Home

It has been revealed by a survey on Ctrip that employees who were allowed to work from home had a significant improvement in their performance and their productivity increased by 13%. At the same time, the attrition rate for the employees who worked from home also declined by 50% as compared to those who worked from office. Such employees have also witnessed a substantial rise in their work satisfaction. The organsation on which the survey was carried out was seen saving $2,000 per employee who was allowed to work from home (Bloom et al., 2013). This is because working from office involves administrative cost. Moreover, high work satisfaction has a direct impact on employee productivity with low level of staff turnover and, thereby, increasing earnings per employee over expenditure on them.

The study further informed that no requirement for commuting to the office on a daily basis is one of the key reasons behind employees’ willingness to work from home (Bloom, 2014). This demonstrates that travelling to office requires physical efforts that leave the employees mentally tired. As a result, their contribution to the organisational tasks decreases substantially. Mental stress has a direct relationship with employees’ performance at work and their productivity (Cartwright & Cooper, 2009). The experiment group reported that, lesser “work exhaustion” makes them develop a positive attitude towards their work that has a direct effect on their performance. Therefore, it can be stated that this survey has proved work from home beneficial for the employees and employers in terms of higher productivity and enhanced performance. However, a question arises here that, if work from home is beneficial of every employee, irrespective of their nature of work. This is because the experiment was conducted on the call centre employees, which involves telecommunication. Moreover, most of the employees in the experimental group who witnessed a significant rise in their performance have worked extra minutes with fewer breaks. This raises a question on ethical grounds since employees working overtime are liable for additional pay, but it is not clear if these employees were given added pay.

On the other hand, after completion of the experiment, the employees who worked from home were asked to choose whether they want to continue working in the same way or prefer returning back to the office. Almost half of them preferred the second aoption. An interesting point to be noted in this context is that, the employees who preferred returning back to the office were the ones who had poor performance while working from home. This indicates that it is not certain that working from home would have a positive impact on employee performance. Also, there are some factors that influence the impact of work from home on the employees’ performance. A “2014 University of Calgary study” revealed that in the context of the relationship between work from home and employee performance, personality plays a vital role. Furthermore, sincere employees with honesty tend to perform well from home, whereas employees with a tendency to escape from their responsibilities are less productive at home (Gregoire, 2015). 

Drawbacks of Work from Home

There is high risk of information security when employees work from home (Tipton & Krause, 2007). This is because it is difficult to monitor the activities of the employees at home. At the same time, the chances of distractions are high while working from home that affects the employees’ concentration. This, in turn, affects their performance significantly. Despite the fact the number of employee opting for work from home is increasing gradually, there are people who do not take work from home seriously (Strauss, 2009). In other words, while working from home employees often develop a tendency to do their household chores along with their office work that severely affects their work performance. On the other hand, Dlabay et al. (2011) argued that working at office provides a completely different atmosphere to the employees where they can interact with their colleagues. However, merely any such atmosphere is available while working from home those results in isolation. However, a point to be noted in this context is that not every individual has the same mind set. There are people who prefer working alone and thus, no such psychological problem would arise for them if they work from home. It has been revealed that in spite of huge population of remote employees in the UK, many of them feel isolated. This is because they believe they are not given the required support by their respective organisations (Canonico, 2016). As a result, they develop negative feeling for their employers that affect their attachment with the company. This direct affects their performance as low level of attachment decreases their morale and motivation level. 

Conclusion

While evidences show that many companies are increasingly focusing on developing effective telecommuting policies to enhance work from home as they believe that it enhances employee productivity and satisfaction, there are companies still concerned that remote worker would not take their responsibilities seriously due to such flexibility and absence of continuous monitoring. Work from home enables the employees to create a work-life balance that enhances their morale and thereby, elevating their performance level. On the other hand, it restricts the organisations from monitoring their activities to keep a track of their performance. Apart from this, it is also seen that work from home often makes the employees feel isolated especially in case they are not given the required support. This has a negative impact on their performance. An important point to be noted in this context is that not every employee behaves in the same way. Thus, it is essential for the organisations to develop a clear understanding of the employees’ state of mind before allowing them to work from home.

Information Security Risks

It has been identified that work from home is not suitable for every occupation. The tasks that require group working or dealing with people directly like customer service and R&D, work from home is not suitable. Thus, it can be argued that the organisations need to consider the nature of job before providing the opportunity to its employees to work from home. Eliminating work from home entirely would not be an effective decision, considering the varying psychology of the employees. Introducing flexible working where the employees can work from home occasionally would be the most effective strategy. This would allow the employees to carry out their organisational tasks from home in case they have problems travelling to office. This would make the employees understand that their respective organisation is concerned for them that would enhance their motivation level that would have a positive impact on their performance.  

References

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Canonico, E., 2016. Does working from home harm your career? [Online] Available at: https://www.theguardian.com/careers/2016/nov/08/does-working-from-home-harm-your-career [Accessed 31 August 2017].

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Gregoire, C., 2015. Working From Home Is Good For You And Your Boss. [Online] Available at: https://www.huffingtonpost.in/entry/work-from-home-health_n_6546838 [Accessed 27 August 2017].

Keller, E.G., 2013. Yahoo CEO Marissa Mayer’s work-from-home memo is from bygone era. [Online] Available at: https://www.theguardian.com/commentisfree/2013/feb/26/yahoo-ceo-marissa-mayer-memo-telecomute [Accessed 28 August 2017].

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