Work/Life Balance: What's It Worth?

It's hard to pin an ROI on the flexible workplace, but IT managers say it pays off.

A young programmer approached Mary Finlay with a request: After just a year on the job, he wanted to work four 10-hour days so he could have every Friday off, a schedule that would allow him to play Thursday night gigs with his rock band without worrying about the next day’s work.

Many IT executives would say no, but Finlay, deputy CIO at Partners HealthCare System Inc. in Boston, OK’d the plan. “He was smart and talented, and we wanted to keep him,” she explains.

Mary Finlay, deputy CIO at Partners HealthCare, says that flexible work options build a workforce thats willing to go the extra mile.

Mary Finlay, deputy CIO at Partners HealthCare, says that flexible work options build a workforce thats willing to go the extra mile.Her decision paid off: He stayed with Partners for nearly a decade.

As Finlay’s story shows, employees aren’t the only ones who get something out of flexibility in work schedules. Companies do, too. Actual ROI figures are hard to come by, but executives can point to tangible returns, from good retention rates to more complete disaster recovery plans. They say the bottom line is this: By giving employees flexibility, a company gets a better, more committed workforce that can help keep it up and running, even during natural or man-made catastrophes. And that has a real dollar value.

Good Business

“Study after study shows that it is extremely cost-effective and very good business to provide flexibility to your employees,” says Barbara Wankoff, national director of workplace solutions at KPMG LLP, an audit, tax and business advisory firm in New York. “Employee morale, employee productivity, retention, historical knowledge — all of those things improve when people feel they have more control over when, where and how they work.”

Wankoff says KPMG workers can opt for flextime schedules — in which they work nontraditional hours — or a compressed workweek, putting in their 40 hours in fewer than five days. They can telecommute from home or a KPMG facility that’s more convenient than their assigned office. Or they can cut back on certain duties and work fewer hours.

Like many companies, KPMG has not calculated a return on investment for these programs, but Wankoff says there’s no doubt that the firm benefits. She cites Norma Jean Dembinski, an associate director in IT. Dembinski has worked at KPMG for five years and in IT for nearly 30 years, holding positions ranging from programmer to vice president of information systems.

Dembinski is a valued employee, so her boss wasn’t too happy earlier this year when she heard that she was thinking of quitting. Dembinski, who works in the Montvale, N.J., office, was getting married and moving to Connecticut. She told her boss that the 64-mile one-way commute would be too taxing. Her boss asked if they could work something out.

So Dembinski now works from home three days a week and commutes to the office the other two. She says she probably would have quit if she hadn’t been able to achieve that balance.

If that had happened, Wankoff says, the company would have paid for it. Based on standard human resources industry numbers, she figures that it costs 150% of an employee’s salary just to find a replacement. That includes the costs of advertising the position and training the new hire, as well as the time managers spend reviewing candidates. It doesn’t include the new person’s salary.

There are also intangible costs associated with losing someone who has an understanding of the business that comes only with tenure, Wankoff adds.

Laurie Bienstock, a compensation analyst at business consultancy Watson Wyatt Worldwide, concurs. “The typical costs of turnover per employee — without even realizing you have lost productivity and intellectual property — can run one to two times employee salary,” she says.

Improved retention and the associated savings aren’t the only benefits of flexible work arrangements, says Janice Bartkowski, who supports IT as director of human resources at American Century Investments in Kansas City, Mo.

At her company, IT staffers can work condensed weeks (either 80 hours in nine days or 40 hours in four days) or nontraditional hours. They can also work part time, share jobs or telecommute.

One benefit of such flexibility is expanded coverage. One IT manager who has a farm, for example, works 7 a.m to 3:30 p.m. so he still has time to tend to things at home after work. Others work later shifts.

Priceless

Heres what 1,311 senior executives worldwide think about work/life balance:

24% Said they would turn down a promotion that would hurt their work/life balance.

56% Said they would seriously consider turning down such a promotion.87% Said work/life balance is critical in their decisions to join or remain with an employer.

Source: Association of Executive Search Consultants survey, May 2006

Bartkowski says flexible arrangements also help the company plan better for disaster recovery, a hot-button issue this year because of the danger of an avian flu pandemic.

“With people telecommuting, if you have a situation at your building, you have people who can still keep working,” she says. “Because of avian-flu-type issues out there, the ability to have people working from home becomes more of a business need.”

Another benefit is increased productivity. Keith Little, a network engineering adviser at American Century, says he telecommutes when he has projects that need his undivided attention. “If I have a bunch of documentation to do, it’s more efficient for me to stay at home than to come in where there’s a constant stream of interruptions,” he says.

Highly Committed

Studies confirm that companies with work/life programs, which can include on-site fitness centers, help with child care or paid time for community-based volunteer opportunities, provide an advantage, Bienstock says.

Each year, Watson Wyatt publishes a report called “The Strategic Rewards Study,” which examines U.S. organizations with 1,000 employees or more. This year, it looked at top performers in 262 companies — those workers who exceeded or far exceeded managers’ expectations during their most recent review periods. It found that of those who reported having work/life balance, 45% considered themselves highly committed employees. Of top performers who did not have work/life balance, none described themselves as highly committed.

Finlay can attest to that. She says work/life options create “a very satisfied, hard-working group of employees. I know, and I’ve had to test this multiple times. When I need people to rally, I’ve never had a challenge. They’re ready and willing to give.”

Lisa Adragna has worked at Partners HealthCare for 21 of the 22 years she has been out of college. She started as a full-time programmer and progressed through various positions and schedules as she gained experience and expanded her family.

Adragna worked part time, shared a job with another mother, went back to full time when she was promoted to corporate IT manager, and then cut back her hours to work as a part-time senior project specialist after the birth of her third child in 2000. Adragna started working full time again in 2003, although she works from home one or two days a week.

With a solid knowledge of functional groups and institutions under the corporate umbrella and lots of experience with the older systems at the various hospitals, Adragna is clearly a valuable asset to Partners.

But she says she’s particularly committed to being a standout employee because of the accommodations she has had over the years. “I feel like I want to prove myself even more because they’ve given me this flexibility,” Adragna says. “I want to prove to them that this really works.”

Does your company offer flexibility to the employees? Should it? Share your opinions at Sound Off: Flexibility: What's It Worth?

Not all flexible policies fit with the demands of IT. See Does Work/Life Balance Work in IT?.

Pratt is a Computerworld contributing writer in Waltham, Mass. Contact her at marykpratt@verizon.net.

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