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The Internet and Employee Productivity - Part 1 of 3

Three Part Blog

Part I: The Internet and Employee Productivity

Competitive enterprises exist to prosper and therefore must operate with efficiency. Corporate stakeholders are tasked to keep labor and material costs low, justify investment in capital and variable expenses and protect the enterprise from contingent and potentially crippling liabilities derived, for the most part, out of negligence (lawsuits, product recalls, negative publicity, physical and IT infrastructure damage and disrepair). We continue to hear that productivity gains are paramount to controlling inflation and keeping manufactured goods competitive in world markets. In order to control costs and maintain your company’s competitive advantage, it is incumbent upon Management to identify and rid the corporation of malingerers and identify those that are less productive. Functional units need to keep their house in order to reduce the probability of extraneous costs. Operational efficiency takes on new meaning in times of economic contraction. Add the constant spate of corporate governance and consumer privacy legislation and you have a recipe that only disturbs the delicate balance managers must deal with as they attempt to meet requirements without destroying employee morale. In considering employee Internet access, clear thought needs to be given to productivity, liability and security.

American employees of all ages and income brackets are growing increasingly unhappy with their jobs. Less than half of all Americans today say they are satisfied with their jobs, an all-time low and down from an already dismal 60 percent in 1995. But among those who say they are content, only 14 percent say they are “very satisfied.” A major source of employee dissatisfaction stems from American employees feeling overworked. The United States now surpasses workaholic Japan in average hours worked.

Why has overwork been so persistent? One reason is that it is generally more profitable for firms to employ a small work force for long hours. The labor costs are lower, the benefits costs are lower and employers can be more selective about whom they hire. Technologies and modern “conveniences” like wireless access points, laptops, smart phones, voice mail, electronic mail and cheap bandwidth worsen the issue. Each of these innovations has contributed to creating what we like to call “the always-on employee”, further blurring the traditional and perhaps once-sacred boundary of work and personal time. As a result, employees feel warranted with the self-proclaimed right to managing their own time while at work. Since the enterprise unabashedly reaches into the employee’s personal time, the employee feels justified in extending his or her personal life into the enterprise. Activities like online shopping, vacation planning, social media, personal e-mail and texting are considered quid pro quo by the employee. This is supported by a national survey that our company conducted which reveled that one third of these employees volunteered that they knowingly violate their company’s Internet use policy prohibiting shopping at work.

So how are employees managing their on-line time when they aren’t working? According to 24/7 Wallstreet, the average employee spends 1.24 hours per week on social media, 0.56 hours per week on gaming sites, 0.45 hours per week on personal email, 0.24 hours per week on web portals, 0.22 hours per week IM’ing, 0.12 hours per week on fantasy football (during the season), 0.13 hours per week viewing pornography, 0.21 hour per week viewing online videos, 0.19 hours per week on search engines, and 0.15 hours per week shopping. For some, this may be justified but who in your organization is managing this 12.5% hit to productivity and, consequently, your higher labor costs? Anyone with P&L responsibility that is used to working near the margins knows this is a huge number with which to contend.

Part II of this series will discuss liability considerations in managing Employee Internet usage.

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