CNN TECHNOLOGY

Working in a `virtual office'

Transcript from "Business Day"

September 27, 1995
Web posted at: 11 a.m. EDT

DEBORAH MARCHINI, anchor: It's a hectic world out there and some companies are changing the designs of their offices to keep pace with the times. Chiat/Day, a New York ad agency, has designed something it describes as a virtual office. There are no executive offices, no assigned desks. Chiat/Day insists its dazzling new space is designed first and foremost to foster creativity and the agency says it's working. Other firms have turned to what are called mobile offices, where workers who travel a lot, rarely visiting the office, share the same space. IBM has saved a bundle by assigning four or five salespersons to a single desk. But what happens to productivity and worker morale? We're joined now by Rich Malloy, editor in chief at Mobile Office Magazine. Welcome to "Business Day."

RICH MALLOY, Mobile Office Magazine: Glad to be here.

MARCHINI: Good. To what extent are American companies basically allowing workers to work at home?

Rich Malloy

MALLOY: Well, so far it's a pretty small extent, but it's growing. There's a lot of interest in it. There's a lot of benefits for the company. Number --

MARCHINI: What?

MALLOY: -- in terms of saving money. Real estate is a big cost. I mean, you think, the average 10-by-10 office costs maybe $10,000 here in Manhattan, so that when you have, say four, five people sharing one office, you save a tremendous amount of money.

MARCHINI: Let me ask you a question, though, that's got to be on the minds of a lot of managers. Do people who are out of sight of their bosses really work?

MALLOY: Oh, yeah. In fact, most cases they work harder than people who work within sight of their bosses because there's always that uncertainty. They say, "Am I doing enough work," so they tend to do more work.

MARCHINI: That being the case, then, productivity, you would contend, also improves.

MALLOY: Yeah, very much so. There are problems, though. Managers have a very difficult time dealing with this because they can't see their employees any more. They can't walk around. A lot of managers basically manage by attendance, you know, taking the attendance of the people who are there at their desks and they look like they're working. They assume that they are working. When you do the virtual office or a telecommuting kind of approach, you have to focus more on the results, productivity. And I think most workers appreciate that and can focus on that.

MARCHINI: Have there been any empirical studies of productivity for people working at home versus in an office setting?

MALLOY: Not so far that I know. I mean, there's some little anecdotal stories and things. But most companies who have tried it, you know, tried little target tests and they've got very positive results from that and they're expanding the program to other parts of the company.

MARCHINI: Now, does this chiefly work with people who don't spend much time in the office anyway -- for example, sales reps -- or can it be extended to lots of different kinds of jobs?

MALLOY: Exactly, I mean, it's not for everybody. There are certain kinds of jobs and there are certain kinds of people who prefer to be in an office. They want to go to a specific place at a specific time and they want to meet with the people. There's a social interaction at the office that a lot of people like. But some jobs, for example, sales, people doing a service, helping out clients, they have to be out of the office a lot of the time. So for them, it doesn't really make sense to have an office for them.

MARCHINI: Doesn't make sense to pay all that money for a desk or a computer terminal or whatever when they can share it --

MALLOY: Exactly, exactly. And it sort of pushes them out to the client and companies now are very focused on productivity. They want the most productivity out of each employee, and for someone who does service or sales, they want that person to be in the face of the client.

MARCHINI: Is it good for employee morale?

MALLOY: It depends on the employee. Some employees love it. They love to get out of the office. For example, our readers, they just love to get out and be out of the office, get away from the bureaucracy. And worst of all is the meetings. You know, meetings go on hours and hours. So once you get out of the office you don't have to deal with that and so they really like that.

MARCHINI: But what happens when you do come in to your shared desk and you find somebody's else's yucky coffee cup still sitting there from the night before?

MALLOY: Oh, well, they clean that up. For example, at IBM, they have a big facility out in New Jersey where there's just a huge warehouse of little offices and you come in and you rent an office for the day and it's clean and they have little handy wipes there, and actually you can clean the phone so the person before -- you clean it off and make sure it's clean.

MARCHINI: So, you really don't see any major drawbacks then in terms of an impact on morale from having to share space, and tensions are created.

MALLOY: Well, again, it depends on the employee. Even Chiat/Day, in fact, ironically, there, the problems they had mostly were with the younger employees who were somehow looking forward to having a regular office the way they always thought it was going to be, and then they don't have that. And also there are some managers and things who've worked long and hard to have a corner office or an office with a window and all of the sudden there's no office like that. So an office is a very big symbol for people and how they fit into a company.

MARCHINI: Do you work at home?

MALLOY: No.

MARCHINI: Do you wish you did?

MALLOY: Yes. Yes.

MARCHINI: All right, thank you for your perspective, Rich Malloy of Mobile Office Magazine. Good to have you with us this morning.

MALLOY: Thanks.



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