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Control Data Corporation: Alternate Work Site Programs Ronald A. Manning Changing employee populations, rising energy, and transporta- tion and real estate costs, as well as the need to increase employee productivity and maintain a positive quality of work life, have led the business community to consider innovative alternatives to the traditional large, centralized office work setting. Control Data Corporation (CDC) has attempted to address these issues by us- ing alternate work sites, such as home and satellite offices. This flexible approach enables managers to adapt a work situation to the employee's lifestyle. Alternate work sites (AWS) are largely possible due to recent technological advances. Many people can now work in a remote location using electronic mail, terminal access to corporate data- bases, and personal workstations. Any function that requires in- put and produces output and that can be transmitted from one site to another via a communications link is eligible for AWS con- sideration. The AWS plan is one step toward state-of-the-art office technol- ogy. its goal is to provide management techniques and mecha- nisms that enable an employee to work fun- or part-time in a loca- tion that enhances productivity, motivation, and job satisfaction. Ronald A. Manning is general manager, Corporate Forecasting and Analysis, Con- trol Data Corporation. 38

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CONTROL DATA CORPORATION 39 BACKGROUND AND CONCERNS Control Data Corporation was started in 1957 by William Norris and a small group of engineers who left Sperry Rand and announced that they were going to design and build the worId's largest computer. Within 5 years the company was making the worId's fastest computers, and over the next 20 years what started as a handful of engineers working in a Minneapolis warehouse became more than 50,000 employees doing business in 47 countries around the world. CDC has offices in 25 countries. Revenues have gone from zero to more than $4.3 billion; in 1983 CDC reached number 80 on the Fortune 500. In addition to producing the worId's fastest computers and be- ing the worId's largest independent supplier of computer periph- erals, CDC is involved in data, computer, and financial services. The company is also known for its innovative management phi- losophy how it structures and applies resources for the benefit of the company and its employees. Control Data's AWS program is one example. CDC has a number of people in different job categories cur- rently working in the AWS pattern. Some participants have both an alternative work site and a central office station, with more than half of their work assignments completed on the alternate sites. There are four major areas of concern associated with the use of AWS: legalities, logistics, management, and personnel. Legalities The legal questions that come into play involve state and fed- eral regulations, and corporate policies and procedures. While al- ternate work sites do not pose large legal problems, certain areas of management responsibility need particular attention, includ- ing security, privacy and customer information, municipal ordi- nances, safety and environmental considerations, insurance, par- ticipation (Letter of Understanding), eligibility and selection criteria, nonexempt AWS participants, tax matters, and limits in the workday. (See pages 59-65 for more details on legalities.)

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40 CASE STUDIES Logistics Logistics are critical. To be successful any AWS program re- quires excellent planning and full understanding by all involved. The AWS program changes the structure and flow of work and communication, requiring special attention to the management and control of remote workers, space scheduling and long-range facility requirements, selection of equipment and office technolo- gies to support remote employees, and evaluation of the success of the program. One must carefully analyze and schedule the implementation of the equipment, supplies, and support that employees need to achieve assigned tasks. These might include telephone instalIa- tion, terminals, communications (internal and external), mass mailings and job postings, computer software support, office sup- plies, and office support (clerical and secretarial). Management The manager and his or her task force are the catalysts for mak- ing AWS a success. Some managers will not be receptive to the AWS concept due to their reluctance to manage workers from whom they are physically separated. These concerns must be ad- dressed through management-awareness training and ongoing roundtable sessions for participating managers. Managers are most concerned about the following five issues when they are con- fronted with supervising AWS programs: 1. Communications. The AWS program increases the need for both formal (meetings} and informal communications. 2. Productivity. Productivity of employees, prior to and after the initiation of AWS activities, must be understood. The impact of the AWS concept on personal productivity must be measured and interpreted. 3. Work selection criteria. Some classifications of work are better suited than others for AWS. One criterion is whether or not specific outputs or deliverables are defined. 4. Reporting. It is especially important for AWS managers to submit periodic reports summarizing the effect, impact, and pro- ductivity in the use of AWS. 5. Cost/benefit analysis. Specific information to be measured

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CONTROL DA TA CORPORA TION 41 or analyzed needs to be gathered and reported to provide crucial feedback on AWS. Personnel The AWS personnel pattern is designed to provide manage- ment with mechanisms that promote flexible use of human re- sources, efficient use of facilities, and improved productivity. Ele- ments of the AWS personnel practices fall into five general categories, coinciding with management responsibilities: 1. Staffing. The ability to attract and retain qualified profes- sional employees will be particularly crucial in the next decade. AWS could be a valuable alternative to traditional staffing practices. 2. Compensation and benefits. Equity should be maintained between AWS participants and nonparticipants. Performance appraisals, use of benefits, time cards, paycheck distribution, mileage reimbursement, and other administrative functions need to work smoothly in a decentralized environment. Career ad- vancement opportunities need to be clearly communicated. 3. Education and training. As the AWS program is imple- mented throughout an organization, orientation and awareness training of managers and participants is required on an ongoing basis. These programs should stress the need for effective com- munications and outline management guidelines. 4. Employee and labor relations. Existing corporate policies and procedures, state and federal, as well as regulations govern- ing personnel activity should be used wherever possible in the AWS organization. Additional policies and management guide- lines should be designed to cover unique situations. 5. Family and social issues. The psychological and sociologi- cal impact of AWS on employees and their families can affect or- ganizational commitment, promotional opportunity, and produc- tivity. Attention must therefore be paid to the employee's home and family environment. HOMEWORK: A CONTROL DATA AWS PROGRAM Control Data Corporation's Homework program is a vocational training and employment preparation program for people who are

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42 CASE STUDIES disabled. Using a combination of education, consulting services, and a computer-based instruction system, the Homework pro- gram trains participants in business applications computer pro- gramming. The program is set up at homes or apartments, reha- bilitation centers, hospitals, and nursing homes. Many participants have no other alternative for vocational training and employment. Some have previously been considered unemployable, including individuals who are severely disabled due to injury or illness, have a progressive disability, have a fluc- tuating health condition, or were born with a disability. The Homework program consists of three phases: Evaluation and selection: Potential students are identified. Motivation and mental abilities are the main criteria for qualifica- tion. Most physical disabilities can be accommodated. Training: Students are prepared for entry-level positions in business applications programming. Job placement: Graduating students are placed in competi- tive, full-time positions. Homework participants receive training through PLATO, a computer-based education system capable of delivering high- quality, individualized, student-paced instruction integrated with conventional learning activities. Once training starts, a stu- dent is required to work a minimum of 20 hours per week. A bene- fit of the Homework program is that the student and the instruc- tor determine an individual training schedule that is very flexible. The PLATO terminal can be used 18 to 22 hours a day, 7 days a week. Through the Homework program, CDC is using its computer and human resources to address one of society's unmet needs: employment opportunities for handicapped people. The result is a viable, profitable business venture. HOW WELL DOES AWS WORK? In November 1982 CDC evaluated its AWS pattern. The find- ings were based on a questionnaire survey of participating em- ployees and structured telephone interviews with their managers. Specifically, the evaluation focused on the impact of AWS on pro- ductivity, costs, benefits, administrative issues, career and orga-

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CONTROL DATA CORPORATION 43 nizational functioning, and the social and psychological effects on employees and their relationships with coworkers and family members. Within the past four years, a small number of employees in courseware operations, PLATO development, and professional services have participated in pilot AWS programs. They included programmer analysts, education analysts, senior consultants, a branch manager, and a general manager. Job duties and responsi- bilities included the design and development of courses, text, and software; presales marketing support; system design; program- ming; consulting; and system support. Employees selected for the AWS pilot program were at varying grades, tenure, and performance levels. Tenure with CDC ranged from 1.5 to 20 years, with an average of 5.5 years. Present job tenure ranger! from 6 months to 5 years, with an average of 30 months. Length of involvement in AWS programs varied from 6 to 48 months, with an average of 20 months. Employee job sites were scattered across the country, some with managers in the same general geographic location or same city, and others managing via long distance to cover different re- gions. Twenty-five employees worked out of their homes and two worked at satellite locations (i.e., another CDC site). Actual daily work patterns varied from one day per week at the AWS to full time at the AWS, with an average of three days per week. Work pickup and delivery was generally accomplished through employees carrying work between their homes and offices. Sev- eral employees relied heavily on transmitting and receiving work via terminals and telephone. Employees occasionally used inter- office mail and coworkers for pickup and delivery. In situations where employees worked great distances from the central office, the U.S mail was used. Managers considered a variety of factors in selecting employ- ees for involvement in the AWS project. A majority of the man- agers stated that personal characteristics and work habits were of critical importance in selecting AWS participants. In general, managers chose individuals they believed were well organized self-starters with good problem-solving and communication skills. During September and October of 1982, 35 employees from courseware operations, PLATO development, and professional services became involved in formal AWS arrangements and were

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44 CASE STUDIES asked to complete an evaluation survey. In addition, the man- agers of these employees were contacted by telephone and asked to evaluate the program. Separate survey protocols were clevel- oped for employees and managers (see Appendixes A and B). Twenty-seven AWS employees completed survey questionnaires and 20 managers of AWS employees were interviewed. Com- ments provided by the managers represented the work of 25 AWS employees. Advantages of A WS Employees cited many advantages to AWS arrangements. Most frequently mentioned were the reduction in commuting problems and an improved work environment. Employees specifically pointed to reductions in commuting time and costs, parking and accessibility problems, and stress associated with metropolitan areas. In the traditional work set- ting, they said, work schedules often revolved around commuting schedules rather than the flow of work. Many were frustrated that they often had to stop in the middle of a task to catch a bus. Working at home, on the other hand, allowed them to work when they felt most productive, often early in the morning or at night. Working at home aBowed them to take breaks when needed, or work continuously when they were deeply involved in a task. Employees also found that they could work at home with rela- tively few interruptions or distractions. Many tasks, such as writ- ing, reviewing, and editing, took considerably less time to com- plete at home. Employees who commented on performance appraisals felt that AWS involvement had improved their job performance, and that this was reflected in their performance appraisals. Employees experiencing positive effects of AWS participation pointed to increased levels of productivity, additional responsibil- ities, and higher quality of work resulting from that involvement. During the AWS period employees mentioned receiving merit raises and awards for excellence. They felt that participation in AWS contributed to these accomplishments. Disadvantages of A WS Employees cited few disadvantages to AWS involvement. The most frequently mentioned disadvantages focused on the reduc-

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CONTROL DATA CORPORATION 45 tion in personal interaction with coworkers. They often felt re- moved from the information channels of the office and missed out not only on the social aspects of the office but also on the informa- tion and training informally available in an office setting. Several employees reported they made a special effort to con- tact coworkers and managers (e.g., scheduling a staff meeting to correspond to their visits) on days when they were in the central office in order to maintain their visibility. Another disadvantage cited by some employees was the diffi- culty in separating home and work. A few people found it difficult to know when they should stop working; their work was taking up more of their personal time. A few employees noted that their homes were not set up for an office, making it difficult to separate the home environment from their work. Productivity andA WS All 27 employees reported that they were most productive when working at their alternate site. Productivity increases re- ported ranged from 5 percent to 100 percent, with an average of 35 percent. The blocks of uninterrupted time and the employees' ability to concentrate were listed as major factors contributing to increased productivity at home. Many found their home environ- ment to be less stressful than the office, thus improving produc- tivity. Several employees also said that they were most produc- tive at night or early in the morning, and the AWS project allowed them to work at these times. Employees iclentified certain job duties as most suited for alter- nate work sites. They reserved duties that required high concen- tration and blocks of uninterrupted time, such as design, develop- ment, documentation, writing, review of materials, research, financials, and coding and programming, for their alternate work site. They reserved duties that require face-to-face interaction, such as departmental and team meetings, brainstorming, coordi- nation and supervisory tasks, and some customer interface, for the central office. While employees generally believed that AWS involvement has the most profound effect on those tasks best suited for work at home, several mentioned that they have learned to plan and structure all of their work more effectively. As a result, they worked more efficiently and reported increased pro- ductivity as an indirect consequence of AWS.

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46 CASE STUDIES Managers noted that many AWS employees were high per- formers to begin with and that productivity increases were diffi- cult to measure. While managers had more difficulties than em- ployees in estimating changes in productivity, managers agreed in 15 cases that employee productivity had improved with AWS participation. Managers' estimates of productivity gains also ap- pear to be more conservative and perhaps more realistic. How- ever, the mean productivity increase estimated by managers was 20 percent. In some cases, retention of valuable employees rather than increased productivity was the primary motivation for the AWS arrangements. Being able to serve a client region and, of course, higher employee satisfaction, were also cited by managers as reasons for AWS arrangements. One manager estimated that one AWS employee became 75 percent more productive. Several managers noted that projects completed by AWS personnel often came in ahead of schedule and under budget, indicating an in- crease in productivity. Two managers indicated a slight decrease in productivity due to the tasks assigned or the difficulty in assigning sufficient work. The remaining managers reported no change or were hesitant to estimate a change because they had not managed the employee prior to the AWS participation. Although performance was viewed favorably, some managers noted that AWS employees may be underutilized occasionally because they are not as imme- diately available to the manager as are the employees in a central office setting. Costs, Savings, andA WS There are several approaches to viewing the cost of AWS. The approach taken here views only the incremental costs resulting from participation in AWS. The largest cost item is telephone in- stalIation and charges, which can be significant since AWS situa- tions require long distance communications. Computer-related equipment costs, though high, were not viewed by managers as incremental costs due to AWS, since most employees in the exper- iment would have had terminals in their traditional offices. How- ever, an expanded AWS project might necessitate more terminals to meet expanded communication requirements and because the

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CONTROL DATA CORPORATION 47 project could reduce the current sharing of terminals provided by a central office setting. Phone installation costs ranged from $30 to $100, with an aver- age of about $60. Monthly costs, including Tong distance ex- penses, averaged $60, and ranged from $12 to $300. Work-related long distance costs were submitted by the employees in their monthly expense reports. Costs for items such as postage, supplies, and administrative support were considered nominal and specifically mentioned in only four or five cases. These were on the order of $5 to $10 per month. Terminal costs, although not considered by managers as an in- cremental cost due to AWS, ranged from $60 to $395 with a me- dian of $90 to $115. The range in cost is due to the inclusion of network subscription costs for some employees. In five instances, added travel costs were incurred by CDC to transport AWS employees to the central office. These costs ranged from $190 to $4,000 a year and varied depending on the distance employees traveled and the frequency of their trips to the central office. The higher costs involved persons working in areas other than regions where the central offices were located. Savings to CDC were cited in areas of employee retention, pro- ductivity increases, and office space. When asked to identify savings to CDC resulting from AWS, most managers pointed to increases in employee productivity. While managers found this area difficult to quantify, a few noted that some projects completed by AWS employees had come in $5,000 to $7,000 uncler budget. Employees reported minimal costs resulting from their AWS involvement. Those employees opting to pay for additional phone lines reported costs of $12 to $15 for monthly phone charges. They did not view this expense as a problem, but rather saw it as a trade-off for their reduced commuting costs and the opportunity of having a terminal at home. Other costs included increased util- ity bills and miscellaneous supplies. These costs were not quanti- fied by employees and were generally viewed as minimal. When asked to identify savings to themselves resulting from AWS, employees pointed to savings in the areas of travel cost and time, clothing, and child care. In many cases, employees also noted that the availability of AWS arrangements allowed them to continue working for CDC.

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48 CASE STUDIES Managing A WS AWS appeared to have some effect on management practices. Several managers indicated that it was necessary to spend a little extra time with AWS employees during the initial stages of the program, and that advance planning was necessary in scheduling staff meetings. These changes were viewed as minor adjust- ments, not major changes. Most managers stated that weekly progress reports from AWS employees were more detailed than those of central office employ- ees. They also indicated that they relied on written reports rather than face-to-face monitoring for AWS employees; many used PLATO and the telephone for monitoring the progress of AWS per- sonnel. In some cases, managers set up special times for account- ing ant! progress monitoring procedures for AWS personnel. Career Development Employees had mixed feelings about the potential impact of AWS on their career development. Eleven believed that AWS in- volvement would have no effect on career and promotional oppor- tunities; nine believed that the increased productivity allowed by AWS participation would have positive career consequences. These employees felt their job visibility was dependent on the quality of their work, not on their physical presence in the office. The remaining seven employees believed that AWS would neg- atively affect their careers because of Toss of visibility in the office ant! potential removal from the office information network. A majority of managers indicated that the somewhat reduced levels of organizational contact and visibility could potentially have an adverse effect on the career development of AWS employ- ees, particularly in the case of employees interested in manage- ment opportunities. Managers attempted to resolve this by as- signing AWS employees some leadership roles and additional responsibilities for client contact. RECOMMENDATIONS Managers and employees made several recommendations about the possible continuation and expansion of AWS. These

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CONTROL DATA CORPORATION 49 recommendations covered participant selection, participation levels, and communication and measurement procedures. Selection of Participants The selection criteria should reflect both employee characteris- tics (e.g., is a self-starter, has good communications skiTIs), as well as the nature of the employee's work (e.g., job does not require constant contact with people). Employees believed that individuals who can work indepen- dently with minimum interaction and can budget their time well are best suited to AWS. They felt that jobs dealing with work on terminals and work with customers on-site are well suited for AWS and that evaluations should be undertaken to determine what other types of work are adaptable to alternate work sites. Some recommendations concerned the level of involvement by managers and personnel in the selection process. While line man- agement realizes that it is necessary to bring personnel and higher levels of management into the AWS participant selection process, they would like to see the process simplified so that timely decisions can be made. They stressed that the primary de- cision in the selection process should be theirs. Finally, it was emphasized that employee involvement in the AWS program should be on a voluntary basis. [eve! of Participation One recommendation concerned the amount of time AWS em- ployees spend at their alternate work site. It was felt that some degree of office contact is always necessary. In a similar vein, some managers and employees stressed the need for all employ- ees to have their own "spot" at the central office, even if it is shared with other AWS workers, to help the employees maintain identity in the organization. Finally, several managers felt that the scope of the program should be expanded to include management, and that they could benefit from having some uninterrupted blocks of time to work on budgets, salary matters, and various reports. They did not fee] that being out of the office one or two days a week would pose major problems.

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50 CASE STUDIES C o m m u r ~ i c a t i o n s a n ~ M e a s u r e m e n t P r o c e ~ u r e s Several managers specifically mentioned the need to develop productivity measurements for evaluating both AWS and non- AWS employees. Although all of the managers believed an AWS arrangement positively affects employee productivity, there was some desire for more objective methods of assessment. Managers and employees stressed the need to foster effective communication channels between AWS employees and the cen- tral office. One manager suggested some sort of orientation for both AWS and non-AWS personnel. Making everyone aware of the structure and goals of the program would enhance the under- standing necessary for a successful program and could help to reduce the communication problems experienced at the onset of the program. Formal AWS arrangements have existed within CDC for more than four years. Some employees are now reporting to a second or third manager in an AWS arrangement. This report represents the third time AWS managers and employees have been formally surveyed or interviewed to learn their reactions and evaluate the success of these pilots. Overall, managers who have been involved in these programs view them quite positively. Employees are also positive about AWS arrangements, indicat- ing increased job satisfaction and satisfaction with the company. This is not surprising due to the voluntary basis of the program. THE FUTURE In late September 1983 at least 36 CDC employees in 16 divi- sions were assigned to alternate work sites, usually their homes. While we foresee no formal company program to promote the use of alternate work sites by able-bodied employees, we expect continued growth of this pattern as managers seek the best possi- ble way to tailor the workplace to each employee's life situation and to the company's needs for skilled, committed people and maximum productivity.