An estimated 14.1 million people in Britain want flexibility in their working hours or location, equivalent to almost half the working population, the consultancy and jobs site Timewise says.
As businesses continue to look to ways in which they can reduce their cost base other than simply by reducing headcount, one stone that is often left unturned is flexibility.
It is commonly held that flexibility costs money, be it in management time for administering a complicated flexible working programme or by having to add more people to the mix to get the work done.
In 1998, certain major oil and gas operators led the way by allowing employees to have every second Friday off of work (The 9 Day Fortnight or Alternative Working Week) – on the basis that they worked their contractual hours over 9 days. Competitors scrambled to put in place similar schemes in order to ensure that they retained their staff and to try and prevent them from being lured away by the competitors.
You could tell a lot about the company’s culture by their response to the question of whether they would consider such a flexible way of working.
The critics feared a drop in service, less management control, chaos and confusion. The leaders who adopted such schemes saw in many cases; extreme reductions in cost, greater productivity, lower absenteeism levels and lower staff turnover rates.
The ability to recognise the “power of the individual”, has helped to take “hire and fire” short-term focused businesses into industry recognised best employers listings including The Times Top 100 Best Companies to Work For and as a result reduced their costs bases considerable.
We should consider how we can differentiate ourselves as employers. Firstly, recognise the need for flexibility and this extends to hours of work and reward.
We need to understand what flexibility is and is not – it doesn’t have to be a fixed programme that gives people extra days off, it is a management willingness to consider people’s individual circumstances. Flexible working isn’t just about mothers with small children requesting the right to work certain hours. The Office of National Statistics suggests that nearly as many men have worked as flexibly as women in the past 4 years In the UK.
So just how considerate are managers of flexible working arrangements? Consider the employee who plans to return from maternity leave. The request to consider flexible working comes across the manager’s desk.
According to research we have undertaken the average time taken to consider such applications is seconds. A study by the Chartered Institute of Personnel and Development (CIPD) found that the cost of staff turnover is two and a half times base salary.
So, a Finance Manager being paid £60,000 per annum is told that she cannot come back part time, so opts to go to one of your competitors.
Based on these factors this decision (which may have taken seconds to make) has cost the business £150,000. These are hidden costs that will never appear on your profit or loss.
In terms of reward thankfully flexible benefits have been introduced in many companies to provide people with a cafeteria style approach to reward. However, you still have to have the company pension or you may lose the company contribution, you must have at least one times life assurance and so on; so the package is not in its entirety flexible.
Very few companies have realised that you don’t have to be ‘staff’ or ‘contract’ and that flexibility can create other innovative packages to secure the best people somewhere in the middle.
The fact is the less flexible you are as a company the higher your staff turnover will be. The costs of this are clear. In recession this becomes a greater issue as people stay with their employers and become less productive.
The lack of willingness from managers to be flexible leads to frustration and ultimately disengagement. A survey by the CIPD identified that 72% of employees reported engagement as a positive impact of flexible working.
We’ve discussed before that less than a third of the UK workforce is engaged, so it is a real problem. Your productivity as a company drops, and profits reduce.
So, our advice; take more than a few seconds to consider if in fact, that case for flexibility may just be in the businesses interests. Because lets face it, if you don’t one of your competitors down the street will.
Dean Hunter is the managing director of Hunter Adams
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