Should employees choose when and where they work as long as they hit their goals? Or is Rowe, the results-only work environment, a step too far for flexibility?

It began in 2003 as an underground movement. Two middle managers employed by US electronics retailer Best Buy were selected for a covert management experiment so secretive that not even the company's chief executive was aware of it. The goal was to develop a workplace culture defined by results rather than by attendance. As long as employees achieved pre-defined goals, they could come and go as they pleased.

The two HR professionals behind the Best Buy experiment, Cali Ressler and Jody Thompson, named the initiative Rowe (results-only work environment). They have since launched their own consultancy, CultureRx, to persuade other companies to follow suit. Ressler says Rowe is "rewiring our decades-old beliefs" about the structure of the working day. "All over the world, there are perceptions about how many hours people are working, how much vacation time they're taking, what time people arrive [and] leave the office," says Ressler. Those perceptions are misguided. Work, she says, should be "something you do, not a place you go".

Rowe is flexible working on steroids: a trade-off that rewards productivity with work-life autonomy. Eighty per cent of lost productivity, says Thompson, can be attributed to "presenteeism", employees who believe simply turning up is half the job done. On switching to Rowe, adds Ressler, "people at all levels stop doing any activity that is a waste of their time, the customer's time, or the company's money. This promotes a more engaged workforce motivated to not only produce something, but to produce something meaningful."

But flexible working is still seen by many as idealistic and unworkable. A report last year by the Equality and Human Rights Commission found that 40 per cent of British men believed that a request for flexible working would negatively affect their chances of promotion. How do you reverse decades of scepticism? "In the traditional work environment," explains Ressler, "people need to worry about being seen in order to get promoted. This is not the case in a Rowe because being seen does not equate to being productive."

Rowe radiates more than a hint of cultish fervour. At times, its terminology veers into self-help territory. Ressler and Thompson's 13 commandments (3. Every day feels like Saturday; 11. Nobody feels guilty) promise to build a framework for the company-wide endorsement of work-life balance over jealousy and resentment.

This is, of course, harder in practice than in theory. After all, not every department at Best Buy's headquarters signed up to Rowe. But at the heart of the system lies an ambition at odds with current convention: the desire to treat employees like responsible adults. There are exceptions, but today's Facebook-banning, systems-obsessed, command-and-control employer pays faint lip service to individual freedoms. It's ironic that while at university, students are encouraged to be free thinkers, choosing timetables to suit their personal goals, but as soon as they reach the world of work, that maturity is sacrificed at the expense of discipline and hierarchy.

Not in all organisations, argues John Schonegevel, an organisational change specialist at New Frontiers. "In freelancing, or any form of contracting, the underlying arrangement is adult to adult, with the contract as the embodiment of the arrangement. It assumes that both parties enter into the agreement willingly and with a sense of equality. Rowe can potentially work if this is the underlying attitude, shared by all parties." But, he adds, "most employees don't want to be freelancers and most employers don't want their staff to operate as freelancers". A parent-child culture is preferred.

Ressler says the choice is between "freelancer and jailbird". Employees, she says, don't want to be "owned between certain hours of the day, Monday through Friday. In a Rowe, companies are contracting with people to provide results, and this will be the way of the future."

It's also the way of the present. Public relations firm The PR Network relies on the services of more than 450 freelancers, all of whom set their own schedules. "There is a layer of trust," says director James Read, which allows employees a good work-life balance. "It's completely down to the freelancer as to how they organise their work: as long as they deliver a result, we're happy."

But Read insists the PR industry is too variable for wholehearted commitment to Rowe. "PR is not really applicable to Rowe," he explains. You could have the best campaign in the world and still be "scuppered by a more newsworthy story". In any case, he adds, "sometimes stories fly, sometimes they don't". And how do you define your objectives? "What does a result look like? Is the Telegraph a result, is the FT a result?"

Consultancy and IT are both well suited to versatile contractual work. Even the public sector has tried hot-desking. But with improving technology, it's possible to bring some of these industries even closer to the Rowe way of thinking. US firm LiveOps supplies a cloud-based VoIP platform that allows its clients to operate huge, virtual call centres for their customers, staffed by thousands of home workers who choose their schedules and are paid only for the hours they work.

LiveOps is run by former eBay chief operating officer Maynard Webb. It's no coincidence that while eBay made its name by creating a flexible marketplace for entrepreneurs, LiveOps provides a platform for thousands of educated, housebound workers, who would otherwise be unable to work. Because the system relies on extreme flexibility, it has huge capacity to scale. After hurricane Katrina, the Red Cross used LiveOps to service hundreds of thousands of donations quickly.

How is this Rowe? The automated LiveOps software cleverly routes calls through to available operatives, offering them work in 30-minute chunks. It also manages performance, keeping a record of productivity and automatically offering more work to high achievers. There, in black and white, is Rowe's most daunting advantage: if high achievers are easily identified, what happens to low achievers? Longer hours have traditionally provided the best camouflage for incompetence, but in the harsh glare of Rowe, only results matter. As Linda Doe, founder of Apana Business Psychology, a leadership and motivation consultancy, says, Rowe could well be useful as a "short sharp way to reduce headcount in a recession".

But is this its intention? In a word, yes. "Rowe sets a foundation for productive turnover," explains Ressler. "Organisations keep their top talent because [these employees are] able to flourish in an environment where they're trusted to be as efficient and productive as possible. Employees that can't meet expectations are exposed. You produce, or you're out."

Rowe's focus on results is rooted in piecework, a management system in which workers are paid by the item. Piecework was superseded by the automation of the industrial revolution, but still exists sporadically in agriculture and IT. Professor Stephen Wood of the University of Sheffield's Institute of Work Psychology believes "results-oriented systems create in the minds of people a clear view of what they are supposed to achieve".

But piecework can develop "tunnel vision", he adds. Workers have "no connections with the person next to them on the line, and no connection to the wider business environment". Quality matters less because quality control is administered "at the end of the line".

Ressler accepts the comparison. But a "piecework system rewards for quantity, whereas Rowe focuses on quality, too. Rowe employees are not robots who churn out widgets at a high rate." Instead, she says, the system promotes collaboration. Doe isn't so sure. Results-oriented workers are rarely mindful of the wider team ethic. That doesn't mean measuring output isn't important, she says. Companies should place equal value on rewarding and measuring softer skills, such as communication, relationship building and coaching.

Since Rowe removes much of a manager's day-to-day decision-making, there is a temptation to view it as a vehicle for weak leadership. "Some would look at Rowe as a bit of a cop-out," agrees Harold Russell, a director of business coaching company Sources of Success, "a bit of an abdication [of responsibility]. I think it's quite the reverse." Rowe requires forceful handling to ensure goals are met and that action is taken if they aren't, he argues.

There's a third reason why weak management would struggle. On large projects, it can be difficult to define what a successful objective looks like. This is true with complex IT projects, where client goals can shift as work progresses. "There is also a significantly high failure rate associated with enterprise projects," says Thomas Fuller, managing director of technology company Coherent Logic. "And by failure, I mean adding no value to the business whatsoever." In such cases, how do you structure payment by results?

And, more crucially, is the result what the business needs? If it is not, says Fuller, then the client might be entitled to ask why it is paying for a project that hasn't delivered. "If the project is not well managed on many levels, moving to Rowe will not work," warns Fuller.

But Rowe has its champions. US entrepreneur Jason Fried runs Chicago software firm 37signals in his own image. Typically, he arrives for work after 10am and his employees follow suit—they come in when they're ready, "or else they work from home", he told Inc. magazine last year. "I have no idea how many hours my employees work. I just know they get the work done."

Fried says he hates companies that treat employees like children, blocking Facebook and demanding their presence in eight-hour blocks. "Instead of getting more productivity, you're getting frustration. As long as the work gets done, I don't care what people do all day."

Does Best Buy still feel that way? Intriguingly, it's hard to tell. When asked to comment on Best Buy's Rowe meetings policy—rule number eight: every meeting is optional—company spokeswoman Kelly Groehler warned against paying attention to negative publicity. She also refused to discuss productivity gains, claiming that the morale of shop-floor employees unable to take advantage of Rowe would be affected. "We're a retailer. We have employees that see all this great press about us, [relating to] benefits they can't take advantage of. It doesn't do us any favours."

BusinessWeek has reported Best Buy productivity gains of 35 per cent in departments that have switched to Rowe. But it's fitting that Rowe's biggest backer provides such an illuminating example of its limitations. Out of 160,000 Best Buy employees worldwide, only 2,000—at the firm's Minnesota headquarters—use Rowe. "It's not a system that works in a retail environment," confirms Groehler. The challenge for Ressler and Thompson is finding more environments where it is successful.