As with many information age terms, the phrase "virtual employee" is not precisely defined. Or, to be more accurate, it is well-defined, but in two different ways. In some cases a "virtual employee" is, in fact, not an employee at all (hence the word "virtual"), but rather someone who is contracted to do work that an employee would normally do and who acts in generally the same capacity as an employee except for the contractual arrangement. This type of virtual employee is not the concern of this article.

The second type of "virtual employee," who is also referred to as a teleworker or telecommuter, is typically a true employee of the company, but works away from the company's facilities at least some of the time, usually at home or at a customer's site. These virtual employees and the requirements for effectively supporting and managing them are the subjects of this article.

The Future is Already Here

Teleworkers are already deeply entrenched in organizations. According to a 2003 survey done for AT&T by the Economist Intelligence Unit, 54% of companies then had some teleworkers. In a similar survey conducted just one year later, that number had already climbed to about 67%. Furthermore, in 2004, 77% of the companies surveyed expected to have some teleworkers by 2006. This trend is validated by a research benchmark, "The Virtual Workplace: Leveraging Real-Time Communications in the Enterprise," from Nemertes Research. According to that benchmark, the number of employees who work in a different geographic location from their supervisors has increased by 800% over the past five years. That translates into a lot of people. The 2004 American Interactive Consumer Survey conducted by The Dieringer Research Group found that 24.1 million teleworkers, about 18.3% of employed Americans, worked at home during business hours at least one day a month.

Why has there been such an increase in the number of people working away from the office? One reason is that, unlike in the not-too-distant past, it is now practical for many people to do so thanks to the proliferation of broadband Internet connections. For example, programmers deep in a heads-down coding phase need only a good connection to their employers' servers to do their jobs. For them, location is irrelevant. Early dial-up connections were often too slow to be practical, but today's low-cost broadband links more than meet the requirements of these professionals.

Modern communication technologies make telework possible, but just because something is possible, doesn't mean that you should do it. What's in it for the organization? Typically, what first comes to mind is the ability to lessen real estate costs by reducing the number of offices and cubicles. That's a valid point. The savings can be substantial. According to a September 8, 2003, article in Computerworld, 17% of managers at AT&T worked full-time from home or a customer site. The resulting annual real estate savings totaled $35 million. These savings are not unique to AT&T. According to researchers at MIT and Gartner, "agile-workplace strategies" can reduce workplace and IT infrastructure costs by 10% to 15%.

Increase Productivity

Improved productivity is another benefit. While the refrigerator is a distraction at home, office distractions may be even worse. Coworkers walking by interrupt the trains of thought of cubicle and office dwellers by saying hello and possibly stopping to chat. These conversations may be brief, but getting back on track after having your thoughts interrupted can be time-consuming, particularly when repeated many times a day. In addition to these walk-by productivity hits, "water cooler" conversations also serve to reduce output. You might have a water cooler at home, but you are unlikely to meet coworkers there.

Formal, scheduled meetings can also reduce productivity. This problem may diminish when many employees are teleworkers. The easier meetings are to schedule and convene, the more frequent and less focused they tend to be. In contrast, when people work from home, meetings are generally rarer and more substantial, making the participants more productive.

Furthermore, while some stress is usually considered to be a positive motivator, excessive stress has the opposite effect. Removing the frustration of sitting in rush-hour traffic to get to and from work may improve employee productivity during working hours.

The benefit of all of this increased productivity can be even greater than the real estate savings. For example, AT&T estimated that the increased worker productivity due to teleworking represented a $100 million benefit for the company in 2003.

An organization with a high percentage of employees working away from the office is also a more robust organization. Should a disaster strike your facility, employees working at home will not be affected. Keeping them productive during a disaster situation will require redundant, dispersed servers, but the employees themselves will likely be unhindered.

Reduce Employee Churn

Improved employee satisfaction and the consequent reduction in human resource turnover is another telework benefit. Consider people who normally commute 30 minutes each way to and from work. Working from home just half of the time will reduce their commute by 125 hours annually over a 50-week year. That's equivalent to giving them more than three weeks of additional vacation time every year.

The elimination of the daily commute is just one factor that helps to improve employee retention. In a study conducted during a 1999 and 2000 teleworking pilot project by the State of North Carolina, all participants said that the ability to telework could be a factor in their job decisions. Chief among their reasons were these:

• Time flexibility and more free time (74%)
• Less stress from commuting (15%)
• Financial savings (11%)

Hiring flexibility is another consideration. The best employees may neither live close to your facility nor want to move or commute. Telework offers a way to hire the best skilled workers regardless of where they live, thereby allowing you to secure talent that would otherwise not be available to you.

Making Teleworking Work

With so many people working from home and likely more to come, the question of how best to manage them comes to the fore. Effective telework management begins by recognizing that not all jobs or all people are equally suited to telework. Before undertaking an initiative, audit all positions in the subject group and ask, "Can this job be done equally well remotely?" In some cases, the answer may be obvious. For example, if a job requires the regular use of resources that cannot be moved or that must be physically shared, the answer is definitely no. However, not all telework impediments will be that clear. A job that benefits from daily face-to-face interaction with others who regularly work in the office is also not a good candidate for teleworking, but that work characteristic might not be apparent until you do a job audit.

When considering telework, don't just look at the jobs. Also look at the people. Because they work remotely, teleworkers need to be self-starters. Someone who needs a lot of supervision will not perform well as a teleworker.

Also consider personalities. There is a social aspect to working in an office. Eliminating productivity-draining workplace socializing is one of the benefits of teleworking, but it can also be a drawback. Workplace friendships can form the primary social network for introverted employees. If you remove them from the office environment, their workplace friendships may dissolve and they may become less satisfied with their jobs. As a result of their frustration, their productivity may fall or they might decide to leave for a work environment that better fulfills their social needs.

After determining who is eligible for telework, you must make sure that they have the tools they need to do their work. For most IT jobs, the minimal requirements are a desktop or laptop computer for their home and a broadband Internet connection. Work-at-home employees might also need software that would not be necessary in the office, such as terminal emulation and Virtual Private Network (VPN) software that allows them to connect to the company's systems securely.

In addition to providing the necessary technology, it is also important to support it. When employees working out of a large office have a problem with their hardware, software, or network connections, they can usually call someone who will quickly fix it or replace it. The level of support for work-at-home employees will never reach that standard, but without an adequate level of support, teleworkers may be unable to do any substantial work for long periods when something goes wrong.

Effective Working Conditions

It is also important to establish a few ground rules for teleworkers. For example, it is generally advantageous to limit the flexibility of telework somewhat by insisting that work-at-home employees make themselves available to accept phone calls and answer emails during core business hours. In addition, set standards for telephone message and email response times. Most jobs require interaction among employees. When everyone works in the same office, it's easy to track someone down if you have an urgent matter to discuss with them. When it is no longer possible to sit on a colleague's office doorstep, serious bottlenecks can form if people become tardy about responding to queries.

Because distractions at home can be an impediment to good work habits, insist that teleworkers set up a work area at home that separates them from their personal activities. Their workspace should also provide some separation from family members who are at home during work hours.

Information Flows

Much of the vital information that circulates in an organization does so through informal channels. Conversations that start with something like "Didn't you get my memo?" or "Oh, I forgot to mention such and such a point in our meeting" are frequently heard in corporate corridors and lunchrooms. Despite the fact that some of these informal information flows can be detrimental--for example, by disseminating misinformation, rumors, and information that should be kept secret--their benefits usually outweigh their costs.

Telework removes access to many of these casual channels. It is therefore important to maintain regular communication with teleworkers to ensure that the vital information that now flows through informal channels is not omitted. If you remain attentive to this concern, switching to telework can provide the advantage of reducing negative information flows, while retaining the positive ones.

Teamwork

Cohesive, enthusiastic teams can accomplish far more than the total output of individual team members working independently. When it comes to teamwork, the whole is truly equal to more than the sum of the parts. However, if not managed properly, telework threatens teamwork. Geographic separation can make members feel less a part of the team. Regular team meetings are an important way to counter this. To avoid losing the cost-saving benefits of telework, many of those meetings will be held by telephone and/or Web conferencing, but because there is an ineffable quality to face-to-face meetings, it is important to also hold regular, although less frequent, in-person team meetings.

Technology also offers ways to help maintain strong virtual teams. For example, electronic bulletin boards can provide a forum for less formal exchanges of ideas among team members. Online conferencing and instant messaging can allow people to communicate freely without the need to assemble in one place. Be aware, however, that not all people have the same communication styles. A number of dos and don'ts must be adhered to in order to respect these differences, but they are beyond the scope of this article. Nonetheless, it is important to be attuned to them because, if abused, some of these electronic communication media can lead to frustration and result in a serious drain on employees' time.

Managing Virtual Employees

It is typically necessary to introduce significant changes to the way employees are supervised and evaluated when they begin to work remotely. Most managers will deny it, but when they are collocated with their employees, observing an employee's regular physical presence is often a major factor in a manager's evaluation of that employee's performance, even if that measurement is done only subconsciously.

It can be argued that employees should always be evaluated based on output rather than input (time at desks) since it is output that contributes to the organization's bottom line, but when employees work remotely, measuring output becomes the only way to appraise them. It is no longer possible to use "management by walking around" to ensure that everyone is where you expect them to be and seeming to be doing what you expect them to be doing.

As with all changes in human resource management, it is important to communicate with employees about any new performance evaluation schemes before adopting them. Without that communication, employees can become frustrated when they are criticized for working to a standard that no longer applies. The result can be lower performance and higher employee turnover.

The Virtual Bottom Line

Teleworking offers benefits for both employers and employees. Reduced real estate costs, improved productivity, and lower hiring and training costs due to improved employee retention are just a few of the more important benefits for organizations. Employees benefit by eliminating their daily commutes, thereby gaining considerable additional free time and reducing traffic-induced aggravations.

These benefits may be overwhelmed by the cost if teleworkers are not managed properly. Care must be taken to ensure that any lines of communication that are severed by lack of geographic proximity are replaced by other communication vehicles. Technology must be deployed to ensure that employees are as productive at home as they are at the office. In addition, methods of employee management and review must be adapted to the new working conditions. Managing teleworkers is not easy, but if all of these issues are adequately addressed, the benefits can greatly outweigh the costs.

Joel Klebanoff is a consultant, a writer, and president of Klebanoff Associates, Inc., a Toronto, Canada-based marketing communications firm. Joel has 25 years experience working in IT, first as a programmer/analyst and then as a marketer. He holds a Bachelor of Science in computer science and an MBA, both from the University of Toronto. Contact Joel at This email address is being protected from spambots. You need JavaScript enabled to view it..