Yahoo! Inc. Chief Executive Officer Marissa Mayer, by ordering staff to report to offices, risks losing the productivity gains that can come from flexible work arrangements and may jeopardize her ability to lure top talent.
Jackie Reses, Yahoo’s executive vice president of people and development, sent a memo last week asking employees with work-from-home arrangements to make their way to the company’s offices, starting June.
“To become the absolute best place to work, communication and collaboration will be important, so we need to be working side-by-side,” according to the memo, whose contents were confirmed by a Yahoo employee who asked not to be identified because it’s not a public document. “Speed and quality are often sacrificed when we work from home.”
At a time when Mayer is under pressure to jump-start growth and create innovative products, the shift may compromise Yahoo’s ability to attract employees seeking the freedom to work outside the office — a perk offered by many of the company’s competitors. Research suggests that working from home enhances productivity, said Jody Thompson, co-founder of workforce consultant CultureRx.
“Mayer has taken a giant leap backward,” Thompson said in an e-mail. “Instead of keeping great talent, she is going to find herself with a workplace full of people who are good at showing up and putting in time.”
Sara Gorman, a spokeswoman for Sunnyvale, California-based Yahoo, declined to comment on the memo or discuss the company’s internal policies.
People who work from home tend to have less stress and are more productive, partly because they don’t invest time and money in commuting, said Brad Harrington, executive director of the Boston College Center for Work & Family.
“When employees have family or other personal issues they need to take care of, the feeling is that by being able to work from home you can take care of those in a much shorter period of time than commuting,” Harrington said.
The portion of U.S. workers who performed their job at least one day a week at home increased to 9.5 percent in 2010, from 7 percent in 1997, according to the U.S. Census Bureau.
In a study of call-center employees of a Chinese travel agency, researchers at Stanford University found a 13 percent performance increase for staff who worked from home.
Mayer, who last year became Yahoo’s fifth CEO in four years, worked from her California home in October in the weeks following the birth of her first child.
Richard Branson, founder of Virgin Group Ltd., said in a blog post yesterday that Mayer’s decision ignores the advancements of mobile and video technology that have helped workers do their jobs whatever the location.
“This seems a backwards step in an age when remote working is easier and more effective than ever,” Branson wrote in the post. “If you provide the right technology to keep in touch, maintain regular communication and get the right balance between remote and office working, people will be motivated to work responsibly, quickly and with high quality.”
Mayer earned the support of some analysts and investors in January, after reporting the company’s first annual sales increase in four years. Her changes will continue to be supported as long as she keeps delivering results, said Colin Gillis, an analyst at BGC Partners LP.
“She needs to rebuild the culture of this company, and she needs to drive revenue growth,” Gillis said. “The whole notion of ending remote working, and whether it’s right or wrong, it’s her prerogative as CEO, and we’ll see if that helps her with those first two goals.”
Yahoo increased less than 1 percent to $20.75 at 9:38 a.m. in New York. Through yesterday, the stock had gained 39 percent in the past year, compared with an 8.9 percent advance for the Standard & Poor’s 500 Index.
The memo was initially reported by the technology blog AllThingsD.