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The End of Time-Based Management?

Tags: Hour, Workforce, ROWE, Recruitment & Selection, Workforce Management, Payroll Solutions, Human Resources, Lindsay Blakely, Results-Only Work Environment, Tammy Erickson, Workplace, Demographics, Generations, Productivity, Flextime

Tammy Erickson writes about employee values, changing demographics in the workplace, and how successful organizations work. She writes the Harvard Business blog Across the Ages and is the author of several books, including Retire Retirement: Career Strategies for the Boomer Generation. We asked for her honest assessment of Best Buy’s Results-Only Work Environment (ROWE) and its philosophy of measuring work by tasks accomplished rather than by time spent.

Is ROWE the workplace of the future?

Erickson: The idea of decoupling time [from results] is the rule of the future, whether it will be in that form or not. We need to stop measuring work in hours and start measuring it in terms of task or production. If you look at the history of using time to measure work, it’s a relatively recent concept starting around the 1930s, when assembly-line production became too complex to determine what you did or what I did. Prior to that, people were paid according to how many buttons they sewed: by task. In the overall scheme of history, the whole hourly thing has just about served its purpose; I think it will be associated with the industrial economy. It just doesn’t make sense to pay by the hour to write a piece of software.

Why is ROWE important and relevant right now?

Erickson: Companies are really struggling hard with people in their 20s [Generation Yers] and 30s [Gen Xers]. The stats on the number of Gen X women dropping out of the workforce are alarming. A lot of it comes from an unwillingness to make family sacrifices. Companies are looking for creative, flexible arrangements for keeping workers in the workforce. I think that was at the heart of Best Buy’s drive for a more family-friendly work environment. That’s one thing a lot of Gen Yers don’t tolerate well: the pace of corporate work. They’re so critical of how long it takes to get things done and how slow their colleagues are. It’s very attractive to Gen Yers to be in a ROWE and be able to get work done anytime, day or night, as fast as they can do it. They don’t have to stay eight hours if they can get their work done in five. And anecdotally, many of them are a lot faster at their jobs.

Does a ROWE have any limitations?

Erickson: ROWE obviously has some limitations, especially in the service economy, where you need people present during certain hours. Even Best Buy would admit they haven’t figured out how to apply it in the retail environment. This kind of environment will become more flexible but not completely ROWE based.

Another interesting angle is the ethical question of whether it’s fair to move to a ROWE when different classes of employees do tasks at very different speeds. If the company went to a ROWE, older employees might have to work 60 hours a week while younger employees work 30 hours to accomplish the same task. The question is: How do we feel about that? I can argue either way that it’s fair or not fair. Companies haven’t been able to get comfortable with that.

Is “face time” in the office overrated?

Erickson: Yep, I do think it is — with one caveat. We’ve done quite a bit of research and found that effective work relationships need trust. Most workers over 30 initially develop trust through face-to-face relationships. Once I trust you, then my need to get together for face-to-face time is quite minimal. My willingness to collaborate actually diminishes if I’m forced to spend a lot of time in meetings with you. One interesting question is: Will 20-year-olds be able to develop trust without ever meeting people face-to-face? I don’t know the answer. Maybe they’re already used to doing that online. Sometimes I think people have meetings just because they feel embarrassed. They think, “Why did we pay $4.50 a gallon to drive to the office?”

Does ROWE ask more of the managers or the employees?

Erickson: It definitely asks more of managers. Even with something as simple as flextime, managers say to me, “But that would make my job more difficult.” Yes, it would! People don’t want to complicate their own jobs. But by doing it they’re going to attract more talent and a higher caliber workforce. My suspicion is that a lot of the evolution of the workforce is on hold as people are preoccupied with the economy. As the economy picks up speed, and hiring resumes in full force, we’re going to find there aren’t enough people. Reaching for ways to attract top talent will gain momentum.

 
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  •  
    1

    Miss Cybernaut

    09/27/08 | Report as spam

    RE: The End of Time-Based Management?

    Thank God someone remembered to declare the end of time tracking and endorse results as the most important happy
    I always felt like a prisoner being done with tasks completely at 2pm and still 2 or 3 hours more to sit....(and surf or blog happy. Indeed I was lucky my company cared only about results, not about where exactly I am spending my time on web.

  •  
    2

    rajeevprabhuat@...

    09/29/08 | Report as spam

    RE: The End of Time-Based Management?

    Really good process that can be or should be implemented in real time world like IT companies.

  •  
    3

    jbinder

    09/30/08 | Report as spam

    RE: The End of Time-Based Management?

    How to measure the "unmeasurable"? Even for tasks such as writing programs, how a manager can know how long each program takes to be fully written and tested, to assign the task to programmers? And how to differenciate between real problem solving time (for complex bugs) and "real slack" ? And how to measure people management and communication activities (like project management)?

    I believe the main difficulty is to separate fast people from lazy ones.

  •  
    4

    suvro123@...

    09/30/08 | Report as spam

    RE: The End of Time-Based Management?

    Hi,

    How to measure the "unmeasurable". Very rightly put. However, after working for 12-13 years in software industry, I have a question. Is it necessary to measure it.

    Making software is both art and science. It is like telling you are a better artist because you can churn out 100 pieces of arts in a day rather than one. Believe me, I have seen enough bad code churned out because of the time pressure of getting things done. They usually come to haunt us back in many ways. Ofcourse, we are in a problem -solving business and that needs time boundaries. So, I guess a balance is required.

    To achieve this balance, I have found that it is better to lead teams by overall objectives that the team needs to acheive. The team needs to leverage each other's strengths. Someone is very good at reasearching out what is out there in the web that we can use. Some one designs code very well. Someone is terrific fast coder. Some one is good at algorithms.

    "Face time in office" is not over rated but I think it is under-rated. It is a part of important engagement process.

    For a manager, I think if you can achieve good working relationship and a culture that leverages strength of each other, takes pride in the work jointly produced, your work is done. After that you just need to manage with very light touch.

    Ofcourse you need metrics. You need metrics to know what is achievable by the team. You need metrics to discover problem areas. You need broad metrics to track individual performance. Very minute metrics like time spent each day can be very counter productive as it is unmeasurable.

    As a manager I think it is like holding sand. Hold it too loosely, it will fall, hold it too tightly it will fall. One needs to get the right balance.

    Regards
    Suvro Upadhyaya

  •  
    5

    kevinj1000

    09/30/08 | Report as spam

    RE: The End of Time-Based Management?

    Now, all we have to do is to get reforms in the labor laws, clarifying exempt employee status. so the lawyers don't swarm in ruin the productivity based workplace, (good luck with that).

  •  
    6

    hmib

    09/30/08 | Report as spam

    RE: The End of Time-Based Management?

    I want to ask one question to all of you. How do you give a project (software) plan when you dont know what will be the availibility of your employees? Wouldnt that be against honesty that you charge someone for a month (22 days * 8 hours a day) and you only work for lets say 10 days and complete the work! I am seriously confused that what should happen here? Like if you tell your customer/client that the money they paid to you wasnt actually utilized, the client would never be happy to give you that 'extra' money?

    Is there a rule that all understand that the work done balances out the estimated cost? or something like that? you can reply me on idrees.butt@hotmail.com as I hardly visit for updates on these forums!

  •  
    7

    JackieB6

    09/30/08 | Report as spam

    RE: The End of Time-Based Management?

    On the employee side: Time & again employees report they would take a lower-paying job in exchange for flexibiliity and work/life balance. ROWE works because a company is investing in personal accountability.

    9-5 is an arbitrary system set-up in the Industrial Age (read Tim Ferris's 4-hour workweek) We live in Enterprise 2.0.

    On the client side: CLients would gladly pay for projects that were delivered in scope, ontime and within budget. Most projects miss all three under an hourly basis.If your staff is held accountable, most of the reasons for delays will be eliminated and your clients would gladly pay!

  •  
    8

    fusiondesignlab

    10/02/08 | Report as spam

    RE: The End of Time-Based Management?

    d

  •  
    9

    twanless@...

    10/02/08 | Report as spam

    RE: The End of Time-Based Management?

    I'm an independent consultant and I've been fighting this time-based thinking since I started. First thing many potential clients ask is how much per hour?
    I respond with how much is this worth to you because the way you're talking, the meter is always going to be running. That usually sets them back.
    Unfortunately, then they often come back with some absurdly small flat fee because they only understand cost in time terms. So instead of discussing value, we have to go back to how many hours are involved. An endless dance.
    It's going to take much education to convince people steeped in the time system to think in terms of results.

  •  
    10

    macleanj@...

    10/03/08 | Report as spam

    RE: The End of Time-Based Management?

    This is such a fantasy. It will happen in small patches of the country like Best Buy for example but I will be long gone before this has any real footprint.

  •  
    11

    irelandmc

    10/03/08 | Report as spam

    RE: The End of Time-Based Management?

    There is a second side to the pay/results coin: Profit sharing. If you pay your coders a stipend just to keep them alive while they write the software, but they all get an equal share in the profit of the end product, they will be motivated to do both good and fast. The smart workers will realize that creating value is what will benefit them.

    The customer doesn't care how many hours you spent creating a product, they care (or should) about what value it represents to them. I agree with my fellow consultant that the "customer" isn't quite there yet, but in a lot of industries they are.

    The customer pays a fair price for the product, the company pays the workers their fare share of the profit, and the workers do quality work (because they want profit) fast (because they want their own time) and everyone wins.

    It is the future paradigm.

  •  
    12

    JK2010

    10/03/08 | Report as spam

    RE: The End of Time-Based Management?

    I see a hybrid coming from this.
    Results-based management sounds effective, but so are deadlines.

    I don't see this in retail stores though. Unless the result was to have an employee stay from 5-10, for example. In that case, I doubt anything but the philosophy behind results-driven leadership (yes, leadership) will help retailers. Best Buy's been doing wonderful in this area. Or at least, they've had exceptional customer service at the Best Buys I've been to. Their name has popped up in a few articles as well.

  •  
    13

    snath

    10/04/08 | Report as spam

    RE: The End of Time-Based Management?

    Actually it is no more about 'management'... it is about 'leadership'. I completely agree with the need for trust in a ROWE. That's B-quadrant working (ref Robert Kiyosaki's Cashflow Quadrant book). And as Kiyosaki suggests, all this can be learnt alongside 'work' through tools available with Network 21. Readers may write to tcnworldwide@yahoo.com to be guided to the trends and options for leading the way in 21st century business!

  •  
    14

    Miss Cybernaut

    10/04/08 | Report as spam

    RE: The End of Time-Based Management?

    I guess SNATH is talking about time matrix...Indeed it's important tool to define priorities. But isn't it Covey's method?

    I wonder why thinking in terms of results is strange? Why should anyone pay your time and risk to pay your laziness per hour instead of results?

  •  
    15

    arethagaskin

    10/05/08 | Report as spam

    RE: The End of Time-Based Management?

    There is no doubt this is why many of us have left the corporate world to start our own businesses! Obviously, the corporate world loses valuable intellectual property every time this happens. I loved "How Work Sucks" and Free Agent Nation and expect we'll continue to see more people leave until ROWE is more widely implemented.

    Aretha
    www.tvlai.com

  •  
    16

    globalraja@...

    11/10/08 | Report as spam

    RE: The End of Time-Based Management?

    I think we still have to wait little longer for ROWE to get embraced. We still have lot of Baby-boomers in the leadership roles, Some GenX have started to take leadership roles but until all baby-boomers are retired and we see GenX and GenY in the leadership, TIME-based traditional approach will still be there

  •  
    17

    marybaum@...

    08/25/09 | Report as spam

    RE: The End of Time-Based Management?

    "How do you give a project (software) plan when you dont
    know what will be the availibility of your employees?
    Wouldnt that be against honesty that you charge someone
    for a month (22 days * 8 hours a day) and you only work
    for lets say 10 days and complete the work! I am seriously
    confused that what should happen here? Like if you tell your
    customer/client that the money they paid to you wasnt
    actually utilized, the client would never be happy to give
    you that 'extra' money?"

    I found this comment fascinating: here is someone who can
    only value work in terms of the time people spend on it - a
    concept I once heard expressed as "butts in chairs."

    I have never, in the last 15 years, connected my time to my
    fees, because what I do - branding and marketing - is so
    much more closely connected to generating real revenue for
    my clients.

    Sometimes I get the absolutely right idea for something in a
    fifteen-second flash - maybe in the shower, or on the tennis
    court. Sometimes a team of five people sits in a conference
    room for a week and still comes up with not much. If my
    right idea - plus, say, two days' work developing it into a
    usable marketing piece - brings in an extra $100K - or
    becomes the beginning of a new, multimillion-dollar
    business unit - why would I expect to bill just a few hundred
    dollars for my time? Clearly I've created massively more
    value.

    Conversely, why would those five people come out of that
    conference room with a campaign that maybe is going to
    break even, and go back to their computers to fill out their
    time sheets for five people, for 40 hours, at maybe $100
    each - charging the client $20K for creating significantly less
    value?

    Now whose money hasn't been used well?

    (And the word is 'used'; to utilize something is to use it in a
    new way - one that most people haven't thought of before.
    "She utilized the saute pan as rainproofing headgear.")

  •  
    18

    estetik

    10/21/09 | Report as spam

    RE: The End of Time-Based Management?

    I am seriously confused that what should happen here? Like if you tell your customer/client that the money they paid to you wasnt actually utilized, the client would never be happy to give you that 'extra' money? gogus toparlama estetigi

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