IBM Reverses its Telecommuting Policy- Now What?

In February, IBM announced that it is reversing its 10 year old policy that allowed telecommuting. All marketing employees must now report to six IBM offices or be terminated. The offices include New York, San Francisco, Austin, Cambridge, Atlanta, and Raleigh. Other employee groups will be affected over the next six months. Employees have 30 days to make their decision. The policy will also be implemented throughout Europe.

         According to a recent news article, “IBM has pitched all this change to employees as a way to improve the working environment and office culture. In a video message to her troops, chief marketing officer Michelle Peluso said "there is something about a team being more powerful, more impactful, more creative, and frankly hopefully having more fun, when they are shoulder to shoulder." (The Register, February 9)

The IBM decision is reminiscent of policy reversals on telecommuting at HP and Yahoo with reportedly negative results. Word has it that this policy decision is not popular with IBM employees. It is estimated that 40% of IBM employees have adopted flexible work styles. IBM has not advised how these six locations will absorb the thousands of employees that will require office space. Many observers suspect that IBM’s real intent is to reduce headcount, particularly older and higher paid employees who have settled into locations that will be highly disruptive to families with school age children, not to mention expensive relocation and resettlement costs. Many of the cities listed above have very high home prices, particularly New York, San Francisco and Cambridge. So the financial impact to employees will be substantial.

IBM’s key competitors, like Apple and Google have a strict policy against telecommuting. Apple’s new flying saucer headquarters in Cupertino is a huge investment in collocation. So it’s not surprising that IBM has decided to bring everyone back to the office despite its huge cost and impact on employee morale.

Frankly, I’m mystified by IBM’s decision. It seems so counter to modern workplace culture that emphasizes agility, empowerment and choice. Recent surveys of Millennials reflect the need for workplace flexibility and with the explosion in mobile technology, people now can communicate from anywhere/anytime including video conferencing.

I recall IBM’s leadership in flexible work styles some 20 years ago and was struck by the huge savings in office costs and reported improvements in productivity. When we studied the flexible workplace at Gartner back in the early 2000s and reported our findings in the Agile Workplace Report, we received significant positive feedback from the project sponsors as well as the broader workplace constituents. It seems that flexible working was a growing trend. But now it seems that for high tech companies like IBM and Apple, it’s believed that collocation of employees is a prerequisite to innovation.

Permit me to doubt! Time will tell.