I have listened in recent weeks to the various pieces of doom mongering surrounding the impact that April’s many bank holidays (including the Royal Wedding) will have on our fragile and recovering economy.
The perceived extent of the ‘damage’ varies wildly depending on the commentator, but one report I read suggested that the UK’s partial shutdown over the last two weeks of the month could cost British business anything up to £30bn in lost productivity. Whilst it is inevitable that there will be some level of financial impact, particularly within the traditional blue collar industries, I suspect the long term effect and many of the figures being quoted are grossly exaggerated; a case of easy headlines rather than a proper consideration of how the modern workplace functions.
It seems to me it has become increasingly common in our culture for holidays to be regarded as a bad thing – an inconvenience for employers and, for employees, an absence that is often squeezed in amongst a hectic schedule and taken with a fair amount of guilt. It is therefore interesting to contrast this mindset with an alternative approach that is slowly growing in prominence in the US, having originally attracted a lot of attention when pioneered by a company called Netflix Inc.
Netflix, a DVD-by-mail and online video rental provider, is a Silicon Valley success story that has amassed over 20m subscribers across the US and Canada since its formation in 1999. The company’s approach to holidays is brilliantly simple – salaried staff can have as much time off as they want, when they want it but on the condition that their work is covered and their managers know where they are.
Netflix’s "Reference Guide on our Freedom & Responsibility Culture" is freely available on the Internet and is a thought provoking read for any employer. In it the company explains, "We should focus on what people get done, not how many hours or days worked. Just as we don't have a nine to five day policy, we don't need a vacation policy."
Such a radical approach would no doubt make many employers very uneasy. But is it that big a leap from what many UK companies already do?
Netflix’s strategy is an example of a Results Orientated Workplace Environment (‘ROWE’), an idea originally pioneered by the US retail chain Best Buy in the early 2000s. ROWE essentially means that employees are free to do whatever they want, whenever they want, as long as the work gets done. Time spent in the office isn’t a measure of their productivity but instead they are set clear goals and timeframes in which to deliver. This concept will be familiar to many in some shape or form.
Over the past 10 years, technology has helped to fuel a fundamental revolution in our working habits. Mobile phones, Blackberries and virtual networks all now offer employees significant flexibility in terms of how they fulfil their roles, providing them with instant connectivity 24 hours a day irrespective of their location. Many companies who have embraced this technology have been able to offer their employees favourable working arrangements such as the option to work from home or to operate on flexi-time. Indeed current UK law now provides a statutory right to a significant proportion of the workforce to request flexible working arrangements from their employer.
At the same time though, technology has raised customers’ expectations and so also what employers now ask of their employees. Staff are expected to be able to be contactable more often, to respond quicker and to deliver to tighter deadlines because of the additional resources available to them. For that reason, cynics may argue that Netflix’s ‘non policy’ is simply another clever gimmick that ultimately results in staff feeling pressurised into taking less time off. After all, in an increasing competitive workplace, how willing will an individual be to have a week’s holiday when their promotion rivals seem happy to go without? In the modern workplace, it is already a common occurrence for employees to reach the end of their holiday year and still have a significant bank of unused leave that they have felt ‘too busy’ to take. Even when employees do manage to take time off, very few seem to be able to leave their work behind them. A survey by Stark Brooks Associates found that 97% of business people regularly took their mobile phones on holiday and 68% took either their laptop or Blackberry. Over a third admitted that wireless internet access was a ‘must have’ before they would even consider staying at a resort. This hardly seems in the spirit of vacation time as a means to relax and recouperate!
Personally though, I don’t see this as a weakness of ROWE as a concept but rather a failing of an organisation’s culture - the two must be alligned with each other to work successfully. Are employees really able or motivated to deliver to their best and go the extra mile when they are so drained by the pressure of simply trying to keep up? Does the money spent by an employer in recruiting and training these individuals generate a proper return if they simply walk out the door a year or so down the line?
"People are our greatest asset" is a much-used cliché in the business world, but it is only partially true. It is the talented individuals who are truly engaged and committed to their company’s vision and strategy that are the real assets. They are what give companies a competitive edge and so finding new ways to attract and retain them will always be a key challenge for prospective employers – particularly as the demands and expectations of the modern workforce evolve. ROWE is a human resource strategy that appeals to me both as an employee and as a manager of a team and I find Netflix’s specific application of it in respect of holiday entitlement to be a very interesting one. Whether it is a viable option in the UK corporate environment is very much open to debate, but I think it’s certainly an option worth considering for some businesses.
To those on holiday this month – enjoy them!