What ROWE Means for the Workplace of the Future

Results Only Work Environment (ROWE)

The Premise of ROWE

Introduced within the “big box” electronics retail giant Best Buy, the Results Only Work Environment (ROWE) concept was built around a fairly basic premise: “People can do whatever they want, whenever they want, as long as the work gets done (Thompson & Ressler, 2008, p. 3).” The initial pilot was developed under the working title “Alternative Work Program” in 2001 as part of a Best Buy corporate effort to become an Employer of Choice. The model followed that of many other companies conducting similar “flex-work” experiments, with the notable exception that the employees themselves were responsible for designing the program based upon their recommendations and preferences for how and when to complete their assigned tasks.

The pilot was ultimately successful and embraced within Best Buy, starting with the pilot of 320 employees, and leading to more than 3,000 Best Buy workers participating in ROWE. Best Buy chief executive officer Brad Anderson has given the program a strong endorsement, stating: “At its heart, ROWE is a chance for everyone to learn a better way to work. It encourages people to contribute rather than just show up and grind out their days. We’ve created a distinctly human culture that … trusts [employees] to do their jobs. ROWE fits in perfectly with those ideals (Thompson & Ressler, 2008).”

The Promise of ROWE

Many companies, particularly in the United States, tend to reward and recognize hours spent at work, referred to as “presenteeism (Thompson & Ressler, 2008).” Working long hours is in some organizations considered a badge of honor, and the authors cite a number of instances where employees who are not making a meaningful contribution to the organization’s bottom line compensate for their incompetence by simply putting in more hours where they are visible to management at their desks. According to the authors, measuring productivity and commitment based on hours spent in the office does foster a workplace that values and rewards this so-called presenteeism, at the expense of real productivity and a genuine focus on individual contribution to the business results.

ROWE seeks to break that pattern by refocusing the way work is done by giving the employees the ability, the support, and most importantly the trust that they need to manage their own schedules and fulfill their commitments on time, in line with all stated expectations, but on their own time.

In the business case created by Thompson and Ressler to introduce ROWE, they emphasize that ROWE is an employee-managed system that is focused on accountability, setting and achieving clear goals, and creating an entrepreneurial environment where employees can take risks, introduce innovative concepts and ultimately stay focused on the needs of the customers, both internal and external.

Real World Examples of ROWE

Best Buy is not the only company that has embarked on this type of work model, and they were not the first or the last to do so. According to a Boston Consulting Group study, 85 percent of business executives are anticipating the increased use of remote working and “unleashed workers (Conlin, 2006).” This already includes companies such as Microsoft, Oracle, IBM, Sun Microsystems, and in some cases even government offices at the state and federal level. Companies that have embraced ROWE have reported encouraging results.

Thompson and Ressler take pains to differentiate ROWE from many of the other initiatives, stating emphatically that “ROWE is not telecommuting, compressed workweek, reduced hours, flexible schedules or a “time off” program (2008).” They have formed a new company, Culture Rx, to guide organizations through the process of implementing ROWE, and count among their clients such firms as GAP Outlet and the Girl Scouts.

Gap Outlet is a division of apparel retailer Gap, Inc., and the ROWE concept was selected by company president Art Peck as a way to improve work-life balance and retention of employees at the company headquarters. Within one year, the company was able to increase its productivity by 21 percent, while reducing turnover to 5 percent and increasing employee engagement scores from 67 percent in the year prior to adopting ROWE to 86 percent at the end of the pilot phase (Fox, 2009).

What ROWE Means for Organizational Development

There are a number of issues that would need to be considered before a company adopts ROWE, among them labor law and classification; management readiness; corporate culture; and ultimately, the ability of the organization to achieve its goals efficiently and effectively with such a system in place. Transitioning to the ROWE model will require a number of critical organizational development (OD) interventions, including a well thought out change management strategy and an assessment of organizational readiness prior to simply instituting the new approach. At the structural level, the entire performance management system would need to be revamped to enable ROWE, and the areas of organizing tasks, jobs and roles would likely require a complete overhaul to actually correspond to the ROWE notion that employee contributions are evaluated based solely on results. The results themselves would have to be carefully reviewed and redefined.

ROWE initiator and CultureRx co-founder Jody Thompson stated, “The biggest challenge for managers is to let go of that physical presence and time piece, and really get clear about goals and expectations with each person and stepping back and letting that happen.”

In an interesting twist, not only are there many people concerned that ROWE could impair management of the organization or lead to a lack of accountability; there are also some people who see ROWE as the final straw in blurring the lines of where work stops and personal life begins. It has even been described as “Machiavellian” in a BusinessWeek article (Conlin, 2006) that goes into depth about the Best Buy experience.

Done correctly, ROWE has the potential to support an organization’s human capital goals through better retention of talent and optimization of individual contributions. In addition, benefits that were realized at Best Buy and at other CultureRx clients included increases in organizational capacity, improved customer satisfaction ratings, increases in employee engagement and morale, and better leverage of technology tools in support of the business objectives.

ROWE is not without its detractors. Its creators acknowledge that it is not yet effective for use in a retail environment but is better suited for the corporate environment such as a headquarters. Thus far, CultureRx has struggled to find companies willing to embark on such a radical change in their approach to managing people, and the Best Buy example may prove to be more of an anomaly because of Best Buy’s culture and leadership.

Paul Rupert, a consultant to Xerox and Wal-Mart, pointed out the following: “You can ridicule an obsession with face time, but some companies have a strong belief that having people at the same place, in the same time, creates synergy that is valuable to the company (Kiger, 2006).” Rupert also pointed out that the leadership team at Best Buy is much younger than that of more traditional companies, and alluded to the possibility that ROWE is more of a generational phenomenon than a workable management practice.

To their credit, the CultureRx consulting team members have put together a number of compelling metrics and key performance indicators to showcase what they see as the positive effects of ROWE, such as: focus when working, productivity, efficiency, control of time, job satisfaction, health and wellness, and work-life balance.

Whether ROWE ultimately catches on, generational changes in the workforce, coupled with today’s technology and increasingly global business environment, will cause the acceleration of similar work practices that will require OD professionals to completely rethink the organization. There was a time when work was a place that you went, because only the factories and offices could economically house the tools and resources needed to perform the typical jobs of that era. In today’s economy, to paraphrase a quote that is frequently uttered but not well attributed, “Work is something you do, not somewhere you go.” With an increasing emphasis on knowledge work, human and intellectual capital comprise the most valuable assets of today’s corporations, and with mobile computing, smart phones and any number of other technology tools available to the modern workforce, much of the work can literally be done, “wherever, whenever.”

Rather than getting caught by surprise as this trend intensifies and permeates today’s corporations and organizations, OD professionals can and should actively look for ways in which appropriate, manageable and effective balances can be struck between the needs of the business, the capabilities of the workforce, and the technology which brings it all together. The companies that learn how to harness the potential of ROWE and other similar approaches will have access to worldwide talent and capabilities unmatched by the traditional companies of today. And if people are truly the greatest asset any corporation has, the companies that master the talent supply chain will dominate their respective industries.

References

Conlin, M. (2006, December 11). Smashing the Clock. BusinessWeek.

Fox, A. (2009, September 8). Gap Outlet: Second Retailer Adopts Results-Only Work Environment Strategy. HR Magazine.

Kiger, P. (2006, September 25). ROWE’s Adaptability Questioned. Workforce Management.

Thompson, J. & Ressler, C. (2008). Why Work Sucks and How to Fix It. New York: Penguin.

Results Only Work Environment (ROWE): What It Could Mean for the Workplace of the Future

Posted on April 21, 2012, in Jobs, New World of Work. Bookmark the permalink. Leave a comment.

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