There are potentially big financial benefits and it helps you keep top talent too, says Lisa Buckingham
Flexible and part-time working have, traditionally, been seen as benefiting (usually female) employees. They’re work patterns which companies are forced to grin and bear. They have certainly rarely been viewed as a way for organisations to achieve their strategic goals while increasing sales and cutting costs.
It was fascinating, therefore, to hear of some preliminary research from the Agile Future Forum (AFF) which suggested that flexible working could be a win/win for companies and their employees, with potentially huge financial benefits.
A study by consultancy McKinsey of the 22 founder members of AFF – including blue-chip organisations such as Ford, Lloyds Banking Group, BP, Tesco and John Lewis – found that agile working could create value equivalent to between three per cent and seven per cent of workforce costs, and a sales uplift of up to 11 per cent.
On any measure these are not gains to be ignored, particularly when surveys suggest that around a third of companies worry that offering flexible working to all employees would hit productivity while almost 40 per cent fear that employment costs would rise.
However, McKinsey suggested that flexible workforces could mean companies would be more able to match workforces to fluctuations in demand, and the quality of output could improve through multi-skilling and improved service to customers as well as attracting and retaining high-quality talent. Interestingly, these gains are available to businesses of all sizes although the opportunities and challenges vary for SMEs and public-sector organisations.
The gains experienced by AFF’s members ranged from huge savings on property, reduced head office costs through the use of freelancers to meet seasonal demand and a value creation equal to 13 per cent of workforce costs in a Tesco superstore by the use of part-time working and multi-skilling practices.
AFF does not claim that achieving the benefits of agile working comes without challenges – business imperatives probably need looking at afresh, a one-size-fits-all change to working practices may not work and, frequently, top management is the biggest barrier to change. Yet without the buy-in of senior executives, change is unlikely.
Like so many other potential workplace benefits, management needs to trust its employees and to measure outputs rather than simply jackets on the back of chairs. This can be uncomfortably demanding for executives who might prefer to stick with work patterns they are used to even if it means failing to grasp a lucrative opportunity.
With the prospect of a potentially better than 10 per cent gain in sales and the equivalent of a seven per cent reduction in workforce costs, only a foolhardy manager would refuse to take a look.