Following up on a question a few days ago, about the source for Werner Schaer's quote in the Washington Post article (blogged last Monday), Steering Employees Towards Telework...

We've all heard the $5-to-$10K quote so many times that we've taken it as gospel. I was surprise to find that there isn't one specific source, but rather many.

Much of these case study-based estimates are a few years old, and many don't cover all areas of potential savings: real estate, recruitment & retention, productivity, travel costs. A long-term research study could very well show higher savings with all aspects considered in today's dollars.

Here's his full quote, with the part that provoked the question in bold:

"Werner Schaer, chief executive of the Herndon-based Software Productivity Consortium, a not-for-profit group that helps companies adapt new technologies to improve profits, said he focuses the telecommuting pitch to private companies on studies that show it can save $5,000 to $10,000 per employee annually through productivity gains and reduced office space needs and travel. The problem: Business executives' concerns about traffic congestion pale in comparison to worries about everyday survival in a tight economy, he said.

"Helping to reduce traffic "is more in line with being a good corporate citizen or being an employee-oriented company," Schaer said. "All those things are nice, soft characteristics, but companies aren't run on soft characteristics like [reducing] congestion. They're focusing more on the bottom line." "

The question was simply... which studies? Here's a list of my previous blogs on the Telework Times that mention these savings... they're case studies of individual organizations, and have different focuses... absenteeism and job retention in the first case, real estate in the next two:

• Quantified benefits from telework: $10K per employee; 25% ROI (7/7/03) - employers can save $10,000 per employee by reduced absenteeism and job retention costs, according to Management Recruiters International
• Success in a Virtual World (7/25/03) - IBM estimates $10,000 per employee that gives up their dedicated office space.
• On-the-Fly IT for Workplace Flexibility (9/9/03) -  In the first year of its agile workplace program, Cigna found real estate cost savings of $1500 per worker, and $3,000 per worker in its second.

And a few more sources thanks to Deanna West's helpful research:

• from a Working Solutions press release, "Conference speakers [at the North Texas Technology Council's 2nd Annual Telework Conference in PLANO, TX - January 31, 2003] whose companies had telework programs estimated a cost savings of $5,000 to $10,000"

• and according to Harvard Business Review, May-June 1998 v76 n3 p121(16) The alternative workplace: changing where and how people work AT&T's Creative Workplace Plan estimated annual real estate savings of $5,000 to $10,000 per person by 2003. How did they do against their predictions?Organizing Around Networks, Not Buildings - 2002/2003 AT&T Employee Telework Research Results doesn't calculate a per person figure (how many days per month must one telework to be counted?), but provides numerous other insights into where the savings are coming from.

• ITAC's 2003 research report Teleworking Comes of Age with Broadband states that  "Adding real estate savings [$2,227] to productivity gains [$2,814] brings the annual savings per teleworker to over $5,000."

10:51:33 AM    
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