Nortel Networks develops teleworking in Britain and Europe

This article by Andrew Bibby, in a slightly different form, was first published in Flexible Working magazine (UK), 2000

Nortel Networks, the Canadian-based telecoms equipment multinational, is in expansive mood. The company, which employs about 70,000 people worldwide, announced in November that it would be creating an additional 1,800 jobs in Britain, primarily relating to the production of transmissions systems for the Internet.

Although north America is Nortel Networks’s home market, Britain is at the centre of the firm’s extensive European network. Currently there are about 8,300 company employees based in the country, working at the head office in Maidenhead and at plants in other parts of the country. An increasing number of these people, however, will soon be making their workplace in their homes. Nortel is currently developing an ambitious teleworking project, which according to Christoph Haas, marketing manager for the ‘Alternative Workspace Programmes’, already has about 600 participants in Britain and Ireland and is attracting new staff recruits at the rate of ten a week.

The British telework programme is about to be exported to mainland Europe, where the company anticipates that staff in five other European countries will be able to begin to telework from early this year [2000]. The eventual aim is to make teleworking a major element of the company’s practice throughout Europe.

Nortel’s interest in telework originates in the USA and Canada, however, where according to Christoph Haas a telework programme (or, in the preferred US usage, ‘telecommuting program’) has been running for about five years. By September 1998, the company had over 4,000 teleworking employees, of whom about 40% were full-time and no longer retained traditional offices on Nortel premises and 60% were part-time (one or two days a week) teleworkers.

The company reported then that "telecommuters have reported 10% higher employee satisfaction ratings and 20% higher productivity than the general Nortel Networks population". An earlier survey, when Nortel had 3,400 teleworking employees was even more upbeat. It claimed to find:

The company is now planning a major increase in its telework programme worldwide. In theory about 20% of its employees (or over 15,000) are seen as potentially able to telework; Christoph Haas suggests that about 15% may be a more realistic target for the year 2002. Currently Nortel has a total of about 5,500 teleworkers.

According to Christoph Haas, there are a number of reasons for this interest in telework:

- Firstly, he identifies the savings in property costs.

The firm estimated in 1998 that its telework programme was already bringing in savings of over $8m annually from reduced real estate costs.

- Secondly, he argues that teleworking enables the firm to retain and recruit highly qualified staff and to offer better levels of satisfaction for its employees. "I know of people who say ‘I’m going to leave Nortel if it doesn’t provide me with the facility to work from home’," he says. As he points out, there is a high cost to the company each time it is obliged to recruit new qualified employees.

- Thirdly, he sees teleworking as improving the flexibility of the company’s way of operating. He says that it makes sense for staff in Europe to participate in conference calls with colleagues in north America in the evenings, from their own homes. "This gives more flexibility to the ways we do business," he says.

There is perhaps also a fourth reason. Like other telecoms companies, Nortel has an interest in encouraging its clients to consider teleworking. The company has its own technological solution for home-based workers, marketed under the name Meridian HomeOffice II, which it also uses for its own internal teleworking staff. This kit, according to the company, "consists of a single high-speed router at the employee’s home office that connects the phone, fax and personal computer to the public network through a single ISDN BRI [ISDN 2] line. The router — the size of a small modem - provides access to the corporate intranet (via an ethernet connection) as well as all the features and functionality of Nortel phones. The router has a port for a digital phone set, as well as an analogue port to connect a fax machine or other analogue device."

Christoph Haas himself makes use of Meridian HomeOffice in his own work, which sees him operating from home in London for about four days a week. "My lifestyle is based on that little home office box. I’m saving an hour and a half travel every day, that’s at least half a day a week, but I have exactly the same tools as I used to have in the office," he says. This means not only that he has full access to the company’s networks but also that he gets full telephone functionality including voicemail and conferencing facilities.

Nortel’s most concerted effort to date to encourage telework has been undertaken in Richardson, Texas, where the firm ran a one year employee telework incentive pilot from October 1998 to September 1999. Nortel offered to pay employees who became full-time teleworkers the sum of $2400 ($200 per month), payable in six monthly instalments in arrears. Employees required their line manager’s approval to participate, and had to undertake to give up their office space entirely.

The number of home-based workers in Richardson rose to 560 as a result of the pilot, a 200% growth on 1996/7 levels. As a consequence the firm has been able to make substantial savings on property: "The office space recovered is the equivalent of a four-storey building," Christoph Haas says.

No similar incentive scheme has yet been tried in Britain or mainland Europe. In Britain, the company’s use of telework began with a pilot but has now developed into what Christoph Haas describes as a mature programme. This means, among other things, that it takes only a matter of about four weeks from the time when an employee first indicates that they want to telework to get them set up and working from home — and Haas says that the time could be cut to two weeks, if it wasn’t for the delays in installing the necessary ISDN line.

The actual procedure involves an employee completing the telework application form which is held on Nortel’s intranet. The approval of their line manager (in the shape of a signature on this form) is the key to begin the technical process of installing an ISDN line and configuring the home equipment. The company’s HR department has a primarily administrative role in issuing a revised employment contract, and the firm also has a health and safety checklist for would-be teleworkers to complete. Home-workers who require additional furniture can check what is available for them, again by using the intranet. Printers and fax machines can also be supplied if required.

Nortel has drawn up a detailed self-administered questionnaire for staff to complete, which is designed to assess the ‘psychological, environmental and personal aspects of work-at-home’. The questionnaire (which Nortel prefers not to make public, citing it as an element in the competitive advantage the firm hopes to achieve by teleworking) takes the form of twenty questions, covering a range of issues including preferred ways of working, home circumstances, and type of work undertaken.

Points are awarded for each answer, and employees are allocated to one of three categories: ‘you will probably make a great telecommuter’, ‘you have the potential to be an effective telecommuter’ and ‘work-at-home.. may not be the most effective approach for you’.

Training (in the form of workshop-based training seminars) for both remote managers and teleworkers is available, although not in any sense an obligatory part of the procedure for starting off teleworking. (However, formal training is being built into the telework pilot about to start in France). The company in any case encourages management by objective setting and performance monitoring. Haas makes the point that the company has considerable experience in running virtual teams, so that it is not only home-based staff who may be managed at a distance, or working with colleagues remotely.

One technique which his own team uses regularly as a way of overcoming geographical dispersion is the ‘conference bridge’. This is a telephone conference line connecting all the team members which is left open all day (though the technology automatically mutes any individual when they are making or receiving their own telephone calls). It means that team members can share ideas and chat informally to each other as appropriate throughout the day. Videoconferencing is not considered yet sufficiently developed for use.

Haas adds that telework is one element of a much broader ‘alternative workplaces programme’, which he hopes to develop in the time ahead. As he points out a high percentage of Nortel’s workforce will remain office-based, and there is a strong business incentive in looking at ways of reorganising the way that their work is undertaken. The alternative workplace programme team is working closely with the architecture and consultancy company HOK International, who are Nortel’s main external consultants for this area.

Christoph Haas identifies seven key success factors in adequate implementation of teleworking:

• Senior executive 'Godfather'
• Buyin from line management
• Strong teamwork between IS, HR and facilities management
• Early customer wins and show cases
• Innovative marketing
• State of the art technology
• Efficient processes and use of electronic tools.

His own preferred telework solution is for managers to arrange regular formal meetings with home-working staff. "I’d recommend that teleworkers come to the office at least one day a week, and I’d also recommend that managers arrange for everyone to be when the teleworkers come in," he says. The company has yet to undertake any formal evaluation of its telework programme in Britain, though Haas says that informal monitoring suggests that, as in north America, staff performance has improved. Certainly the company seems to have no hesitation in pushing ahead quickly with the programme’s expansion.