The Issue

In 2013, Yahoo made headlines when it stopped allowing employees to work remotely. New research shows Yahoo likely misjudged its employees, and the decision may have reduced their productivity in the process.

The Research

Telecommuting usually carries with it two recurring concerns: First, is it a way for marginal employees to escape supervision? And, second, do relationships in the workplace suffer when there are fewer employees around to help each other out?

In short, the answers to both questions are no and no according to new research from McCombs School of Business Professor David Harrison.

“There is a small but positive link between telecommuting and performance,” says Harrison. “So, despite the occasional anecdote, the fear that lots of organizations have about the social environment degrading because there are virtual employees or remote workers is largely unfounded in systematic data.”

Working with Ravi Gajendran from the University of Illinois and Kelly Delaney-Klinger from the University of Wisconsin-Whitewater, the team analyzed feedback from 323 employees and 143 supervisors from small to large firms in a variety of industries.

The results suggested employees who work from home tend to be more effective. In part, they have greater autonomy for arranging their work around productive (uninterrupted) tasks, and they are motivated to maintain the perk of working remotely. When it comes to social context, telecommuters were found to be more helpful towards co-workers because they had to put forth extra effort to be visible in the workplace — to show they were contributing to the team despite not being in the office.

“One surprising thing we found is that the more telecommuters there are in a unit, the less beneficial it is to work remotely,” Harrison says. “We attribute that to the special ‘idiosyncratic deal’ that occurs when there is only one or a couple of employees who get to telecommute instead of the entire team. Those couple of employees are potentially your best performers, if you loosen the strings a little.”

Practical Implications

Harrison recommends using the possibility of working remotely as a carrot to dangle in front of employees who aren’t reaching their full potential. Additionally, if a firm doesn’t have enough cash for bonuses, offering working from home as a reward is a low-cost investment in autonomy that often pays dividends.

“Don’t just give telecommuting to the employee you trust who is part of your inner circle. Our data shows you don’t get any added benefit out of that,” Harrison explains. “Instead, you should use it as a potential reward or reinforcement for good performance. This works especially well for those folks you maybe don’t have the best relationship with because you’re going to get more in return from them.”

Future studies will look into how telecommuting affects career arcs long term, but until then, Harrison advises employees to make the most of face time in the office.

“If you telecommute, it’s a good idea to create digitally observable products and double-down on the quality of your face time when you are in the office, especially if you want to get promoted or earn a raise.”

The Study

Are Telecommuters Remotely Good Citizens? Unpacking Telecommuting's Effects on Performance Via I-Deals and Job Resources