James VanDyke

In 2006 Business Week magazine published an article entitled, “Smashing the Clock.” The article detailed electronics retailer Best Buy and a new work environment they were promoting – Results Only Work Environment (ROWE). The basic premise is companies and workers are tied to a old mind set of a forty hour work week. The mind set is wrong. Companies actually want specific amount of work out of each worker and the number of hours is just an artificial hold over from assembly lines. ROWE says that as long as you get your work done; it doesn’t matter how, when or how long it takes.

On the surface this seems like a very elegant statement. Companies pay for results and employees deliver results.In turn, companies give workers the freedom to do their job in the way that works best for them. As long as the results are delivered every one is happy.

I think the difficulty with ROWE is in the implementation. Cali Ressler and Jodi Thompson have written an book about the program called “Why Work Sucks.” The book discusses some of the mental roadblocks to a ROWE mindset but is light on important issues like setting the “outcomes” for the first time and how to avoid being given too much work. The two authors left Best Buy and created their own consulting firm that sells implementation kits.

37signals the makers of BaseCamp and RubyonRails shared some changes to their work environment recently. Here are three interesting ideas.

•  4 day work week – If people rest for 3 days, they will be refreshed and do better work in four days rather than 5 days of work and 2 days of rest.
• Pay for personal learning/hobbies – This encourages workers to pursue things beyond work. Balanced workers make better workers?
• Let people spend discretionary money – If you’re hiring the right people they will want to the organization to do well and spend money appropriately.

I think the last issue is the most important. Businesses should empower their employees to take risks. If you’ve hired correctly then you shouldn’t be worried about delegating the investment of company resources. This also takes away the bureaucracy of small purchases that can cause employees to go without rather that navigating the red tape.

Companies are artificially secretive about their accounting to internal audiences. Typically granular information about a company’s books is not available to it’s employees and only a small precentage of the company knows exactly how the company is earning and spending money.

I offer this suggestion. Be completely transparent about your company’s spending including how much everyone is paid. Post it all online for any employee that wants to look. This does mean that you will have to be able to justify expenses and salaries but if you can’t justify it then it should probably be questioned anyway.

I previously worked at a company where sharing your salary information with a fellow employee was a fireable offense. Since then, I’ve wondered why this secrecy is necessary, other than it gives the company the upper hand in salary negotiations.

What do you think? Do you see potential pitfalls or problems?