Should Executives be allowed to Telecommute?
The traditional organizational pyramid, complete with its hierarchy of power and authority, has been around a long time. Emerging from the work of Frederick Winslow Taylor in the early 1900s, and refined and embedded within organizations during the 20th Century, the Pyramid is still the prevalent form of how organizations are structured.
An increasingly outdated concept in a global economy buffeted by volatile geo-politics, technological advancement and climate change, the Pyramid is accompanied by the physical presence of employees within organizational silos. Managers want their staff within arms-reach. The “bums-in-chairs” mentality of productivity persists, despite huge gains in the introduction and deployment of technologies that support virtual (distance) work.
The teleworking concept has its supporters and detractors, each making their separate cases. However, these debates have been aimed almost exclusively at those working in non-managerial positions. A recent article from Bloomberg Businessweek presents an interesting perspective on executives teleworking from thousands of miles away.
Diebold CEO Andy Mattes is responsible for a minor earthquake tremor in C-suite land. He’s totally comfortable having most of his direct reports live and work from locations far from the company’s Canton, Ohio, head office.
Mattes joined Diebold, the biggest maker of ATMs in the U.S., two years ago; he was previously with Hewlett-Packard and Siemans. Since taking over the helm of Diebold, Mattes has replaced 60 of the company’s 100 executives. Some two thirds of his new executive team now live in other cities. For example, his chief strategist lives in Boston, a senior VP lives in San Jose and the Executive VP of software lives in Dallas.
This is earthquake stuff to those comfortably settled in C-suite. Imagine, a respected CEO of a big company shaking things up by not just allowing but encouraging executives to live where they prefer. But it’s a no-brainer when you consider that Mattes’ genius has enabled him to draw on the best talent in the U.S. Forget about trying to entice top executives to move to Ohio. There are alternate solutions to getting work done.
What’s especially compelling about what Mattes has achieved is that it’s actually founded on one word: TRUST. If Mattes weren’t comfortable with his own personal leadership, he wouldn’t be able to transcend to the level where he could trust dozens of his executives, living and working thousands of miles away.
Consider that a mere 2.4% of U.S. workers (excluding self-employed) work primarily from home. When looking at those who telework occasionally, that statistic rises to 9.5% (2010 Census), and 40% for professional and managerial workers (2012). While these percentages are growing slowly, there’s a great reluctance on the part of employers to endorse telework. A soft economy further reinforces management’s preference to have bums-in-chairs in visual sight of the manager’s office.
In Canada, Statistics Canada reports that in 2011 only 11% of workers did some work from home (a 2008 survey showed the same result). However, here are a few interesting stats:
• 22% of university grads work from home; only 7% of high school grads do so,
• 23% of those who telework are professionals and managers; only 7% work in sales and service,
• While 10% of women telework compared to 12% for men, only 19% of women in professional jobs engage in this in contrast to 29% for men in these occupations
Yes, there are several valid points to make about distance work by executives. Relationship building with subordinates takes a hit, as does being able to read the nuances from people when at meetings or in informal chats. Travel budgets may need to rise, perhaps significantly to accommodate periodic travel to head office. And being out of the physical loop can weaken an executive’s ability to gather organizational intel. Finally, building an executive team, which understands inter-dependency of effort and shared purpose, is a bigger challenge.
In the face of these legitimate challenges, the executive leadership model that Andy Mattes has created is still hugely worthwhile to investigate for CEOs of companies, not to forget not-for-profit and government agencies. Indeed, it’s time to retire the Taylor-inspired organizational pyramid and seek out new, more efficient and effective forms of top leadership to guide organizations in the 21st Century.
We needed to change the company’s mindset with new people….We were fishing in a small pond. We broadened the talent pool substantially.
– Andy Mattes (CEO, Diebold)
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