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A Business Case for Teleworking
November 17, 2009 at 12:46 pm #85651
This post is meant to be a companion to two other posts titled Teleworking - A Personal Journey and Teleworking - Some Additional Considerations. In this post, I will run the numbers for teleworking from the perspective I shared in my two earlier posts.
From a pure numbers perspective, my commute is 47 miles and averages 90 minutes each way in DC traffic (it's taken me as much as four hours one way, and I've done it in as little as 1 hour with no traffic). By contrast, it takes me 30 seconds to get from my bedroom to my office downstairs, 2 minutes 58 seconds to boot up my HP Windows computer, insert my CAC card, log in, and click through all the automated routines that my IT department set up for me, and 42 seconds to connect the VPN - for a grand total of 4 minutes and 10 seconds. I will subtract the 4 minutes and 10 seconds (my telework commuting time) from my on-site commute time to be fair.
If I were precise about my minutes, which I'm not, I would say that my employer gets an extra 175 minutes and 40 seconds out of my day, every day that I telework. I will instead round up to 180 minutes or 3 hours. So the total additional working time my employer gets for every day I telework looks like this:
Telework 1 day per week = +150 hrs / yr (3hrs x 50 weeks (assuming 2 week vacation))
Telework 2 days per week = +300 hrs / yr
Telework 3 days per week = +450 hrs / yr
Telework 4 days per week = +600 hrs / yr
Telework 5 days per week = +750 hrs / yr
The quality of my work reflects this. Whereas when I do go to the office (which I do every week), I spend most of my time making human connections and nurturing relationships - the sort of thing we do best in person.
Note: There is also an insidious effect in that employees who live and work in the same space tend to blur the two over time. When I first started teleworking, I would find myself working well into the night and early hours of the morning. I would think "I'll just do this one more thing..." and the time would slip away. I admit that I still do this from time to time, but not as often as I used to.
From the employee perspective, consider the following two scenarios (these are my real numbers taken at the time I typed this):
1. Assuming two week vacation, a car that averages 25 mpg, $2.55 / gallon of gas, a 47 mile commute, an $18 parking ticket, and a $10 lunch as the high end costs.
2. Assume the same vacation, car and gas price with a 7.7 mile commute to the Metro. A $4.50 train ticket (each way), a bag lunch from home, a $4 cup of coffee, and a $4.75 parking ticket on the lower end.
In the first scenario, daily cost =
$4.75 trip cost (47 miles / 25mpg x $2.55 gal)
$32.79 per day
In the second scenario, daily cost =
$0.79 trip cost (7.7 miles / 25mpg x $2.55 gal)
+$13.00 ($9 train + $4 coffee)
$18.54 per day
This means an annual, after tax cost savings between $963.84 - $1,705.29 for each one day per week that the employee teleworks. Using the assumptions above, an employee could realize annual after tax savings in according to the table below:
Telework 1 day per week = $963.84 - $1705.29 annual after tax savings
Telework 2 days per week = $1,927.68 - $3,410.58 annual after tax cost savings
Telework 3 days per week = $2,891.52 - $5,115.86 annual after tax cost savings
Telework 4 days per week = $3,855.56 - $6,821.15 annual after tax cost savings
Telework 5 days per week = $4,819.20 - $8,526.44 annual after tax cost savings
In summary, I would offer the following:
- Telework is not for everyone, but where it makes sense to apply telework, it can benefit both the employer and the employee
- Telework can lead to reduction of corporate cost, especially if the work structure is adapted to accomodate it.
- Telework can increase flexibility in schedules through asynchronous communication
- Telework can result in after tax savings for employees
- Telework can make companies more competitive and make jobs with those companies more attractive
- Telework will be abused, so be prepared for that
- Telework requires additional support beyond the obvious: technology, policy, risk mitigation, training and education, and commitment
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