How Best Buy Said Bye Bye to Being There

“For years I had been focusing on the wrong currency. I was always looking to see if people were here. I should have been looking at what they were getting done." – John “J. T.” Thompson, Senior Vice President, Best Buy.

It’s about time. A large corporation with a strong workaholic and face-time culture and without a vested interest in flexible working (such as those selling IT and/or consulting services) has gone against its own grain and introduced flexible working on a large scale. The company that broke out of its traditionalist workplace mode is Best Buy, a leading specialty electronics and appliances retailer.

And surprise, surprise – Best Buy's flexible working initiative has so far been a great success - although not without stirring up intense controversy and strong opposition from status quo defenders in the organization. How Best Buy did it and what they’re planning next makes for a fascinating story.

Revolutionaries in an Unlikely Place

Best Buy’s journey toward adopting wide-scale flexible working - chronicled in a couple of excellent articles that recently appeared in Business Week and Workforce Week - began in an unorthodox way. The idea for it came out of the HR department - a function not usually known for initiating radical ideas and changes on its own. But that’s exactly what happened thanks to two visionary and courageous people – Jody Thompson and Cali Ressler, who at the time, respectively headed up organizational change and work-life balance programs at the company.

This duo exhibited an “attitude” about flexible working as evidenced by this comment of Ressler, "Flexible work arrangements usually turn out to be a con game (my italics). It's only for certain jobs and you have to apply to your supervisor to get them, so often there's favoritism involved." How refreshing to hear such a statement from anyone; let alone someone in HR! While the vast majority of HR professionals are good, competent people, sometimes they reflexivley tow the corporate line, even when these policies are unambiguously counterproductive.

Best Buy’s workplace environment had all the hallmarks of the typical corporate Bataan Death March culture. Getting in the earliest and leaving the latest was a ticket to the executive fast track. All nighters, weekends in the office, broken marriages and disrupted families – were seen in a positive light as evidence of unwavering commitment to the company. Virtual working was virtually unheard of – managers wanted their charges to be on the premises where they could be seen at all times. Promotions depended on regular face time with the right people and was often more important than getting the work done.

No More Keeping Up Appearances

It was about six years ago, when Thompson and Ressler decided they had seen enough and set out to change Best Buy’s workplace culture by devising a program called the Results Only Work Environment (ROWE). It would allow salaried employees at their headquarters facilities to choose how, when and where – at home, in a coffee shop, on a lake, etc. - they got the job done. The same would apply to hourly workers except they would have to work a minimum number of hours to comply with federal regulations. Attending meetings would be optional – the only measure of performance to be used would be whether employees met productivity goals and delivered expected results.

One of the most fascinating things about the ROWE program is how it was introduced. It didn’t come down from on high. There was no “executive sponsorship” in the beginning. In fact, the CEO learned about the program TWO YEARS AFTER it was rolled out. It was instead, introduced on a small scale at the grassroots level in a single part of the business - the retail operations group. It grew organically: as people started working flexibly and their productivity, engagement and job satisfaction shot up, other parts of the company began taking notice and introduced pilots of their own.

It helped that the program was not implemented timidly – unlike most flex-work programs that are only offered to a select few, everyone in the retail operations division was eligible for the program at its inception – no one had to ask permission or could be turned down.

Another critical factor in its successful introduction was offering training to managers in how to lead in the new flexible working environment. Flexible working on this scale demanded that managers be truly comfortable with measuring performance on results, not presence in the office or work hours put in. Baseline metrics of performance were also established before implementing the program so that its subsequent impact could be gauged.

All affected teams were also trained in the new way of working and in how to interact with each other to anticipate and counter the inevitable cultural backlash that was sure to ensue. The flexible way of working was tested for six weeks and then a round of reviews was performed to flesh out problems and reinforce productive behaviors. The biggest challenge was establishing trust – workers having faith that they would be judged soley on their performance and managers ignoring where or when their staff worked as long as they got the job done.

It’s All About Results

Since ROWE was introduced at Best Buy, 2,400 employees, or 60 percent of the 4,000 people at its headquarters campus, have converted to the new way of working. The payoffs have been both tangible and positive. For starters, the company reduced turnover in the divisions where the program has been introduced by 3.2 percent, saving it millions of dollars. And the productivity of the workers participating in the ROWE program has risen 35% on average.

Best Buy’s large scale foray into flexible working proves that the conventional bias of most managers toward requiring people to spend most if not all their time working in the same location is not only out of step with what many workers want and need, it is also impeding their productivity. Initiatives like ROWE help leaders and individual staff to confront and dispel the myths surrounding high performance in the workplace. Having everybody work long hours in the same physical location often detracts from high performance instead of contributing to it. This doesn’t mean however that 100% of workers should spend 100% of their time physically away from the office and their colleagues. Far from it. Rather, it says that face time should be reserved for things that demand it most – developing and maintaining relationships, coaching, brainstorming, collaborating on new ideas, getting to know each other better, building camaraderie, etc.

Next: Taking It to the Stores

Now Best Buy is really getting brave – the company is reportedly planning to introduce the ROWE program into its retail stores this year. Skeptics and nay sayers abound and indeed, the company recognizes that this will be tricky. But annual turnover rates in the stores are so high (over 65%) and replacement costs so great (estimated at six figures per employee) that Best Buy feels it is worth the risk. It will be interesting to see what the company does, and particularly, how it compares to rival Wal-Mart, which recently imposed its version of flexible scheduling on its long beleaguered employees. Under the Wal-Mart plan, its managers, not employees, determine when, where, and how much staff work. Not exactly a win-win.

I’m rooting for Best Buy to succeed with its flexible workplace strategy because if it does it may become a catalyst of real and long-overdue change for the rest of Corporate America.