Rowe program at Best Buy

ROWE at Best Buy

The culture of Best Buy

"See you tomorrow," said Chap Achen, who oversees orders at the Minneapolis branch of the popular electronics company Best Buy "I'm going to a matinee" (Conlin 2006). It was 2pm, but no one batted an eye at the workplace, even though most other employees were still in their cubicles. There was no resentment against Achen because all of the other workers knew they could do the same thing, when other life commitments -- such as higher education, children's school productions or life-enrichment efforts -- took their focus temporarily away from work. Achen was not a CEO; he was a thirty-seven-year-old Best Buy manager. However, through the ROWE Program at Best Buy he was able to participate in an innovative corporate experiment in how employees were valued and viewed.

Once upon a time, Best Buy was known for its competitive, cutthroat organizational culture in the business world. Leaving at 2pm would be grounds for dismissal. However, gradually top-level managers begin to question the effects of "killer hours and herd-riding bosses" upon employee morale and wondered if such an environment was really conducive to productivity (Conlin 2006). High levels of employee burnout and a lack of willingness to share insights with colleagues were the result of the pressured Best Buy culture. Even top company performers "were complaining of unsustainable levels of stress" and often considered quitting "threatening business continuity just when Best Buy was rolling out its customer centricity campaign in hundreds of stores…workers were suffering from the classic work-life hex: jobs with high demands (always-on, transcontinental availability) and low control (always on-site, no personal life)" (Conlin 2006). A change was clearly needed.

The new program instituted at Best Buy was called ROWE an acronym for "results-only work environment" (Conlin 2006). The program sought "to demolish decades-old business dogma that equates physical presence with productivity. The goal at Best Buy is to judge performance on output instead of hours" (Conlin 2006). In other words, to be the last employee at work, toiling away, and burning the midnight oil did not equate to being the most productive, creative, or even the most team-spirited employee. Putting in hours for hour's sake did little to help the company in the long run.

This line of thinking was a natural extension of a shift to telecommuting in the 21st century, at companies such as IBM and AT&T. "But arguably no big business has smashed the clock quite so resolutely as Best Buy. The official policy for this post-face-time, location-agnostic way of working is that people are free to work wherever they want, whenever they want, as long as they get their work done" (Conlin 2006). By 2007 more than 4,000 staffers working at corporate offices were working under the ROWE program. The flexible program has proved to be an effective "recruiting pitch" for top new Best Buy management hires (Conlin 2006). "There are no schedules. No mandatory meetings. No impression-management hustles. Work is no longer a place where you go, but something you do. It's O.K. To take conference calls while you hunt, collaborate from your lakeside cabin, or log on after dinner so you can spend the afternoon with your kid" (Conlin 2006).

Approach to organizational change that the ROWE program illustrates

The ROWE program at Best Buy has been described as a way of 'smashing the clock' of the conventional 9-5 workday. The innovative electronics company has turned the focus of its system of rewards to results rather than hours logged at the company. This organizational change was generated organically at Best Buy, from the ground up, rather than imposed from without. "Another thing about this experiment: It wasn't imposed from the top down. It began as a covert guerrilla action that spread virally and eventually became a revolution" (Conlin 2006). The architects of ROWE knew that the "solution was too radical to simply trot up to CEO Anderson. Nor, in the beginning, did they feel they could lobby their executive supervisors for official approval. Besides, they knew the usual corporate route of imposing something from the top down would bomb. So they met in private, stealthily strategizing about how to protect ROWE and then dribble it out under the radar in tiny pilot trials" (Conlin 2006).

More and more managers, in response to the need for more flexible schedules and frustration with the current corporate culture, began adopting a ROWE-type strategy. "So secret was the operation that Chief Executive Brad Anderson only learned the details two years after it began transforming his company. Such bottom-up, stealth innovation is exactly the kind of thing Anderson encourages. The Best Buy chief aims to keep innovating even when something is ostensibly working. 'ROWE was an idea born and nurtured by a handful of passionate employees.It wasn't created as the result of some edict'" Anderson says, which is why it worked (Conlin 2006). ROWE is based upon real needs, real employee thoughts, feelings, and life demands, rather than imposed from without according to an MBA textbook, although ROWE does seem to support principles of participative managerial philosophy in its construction.

Even naysayers could not quibble with the empirically-proven results. Employee retention has increased since ROWE: "voluntary turnover has fallen drastically" and productivity increased an average of 35% in departments that switched to ROWE (Conlin 2006). Outside audits of employee satisfaction and engagement also showed stratospheric increases. ROWE may also have helped Best Buy financially, particularly in instituting its new customer-centric campaigns. Such endeavors are expensive because they involve "tailoring stores to local markets and training employees to turn customer feedback into new business ideas. By letting people work off-campus, Best Buy figures it can reduce the need for corporate office space, perhaps rent out the empty cubicles to other companies, and plow the millions of dollars in savings into its services initiative" (Conlin 2006). Offering additional service to customers has been a critical way for Best Buy to distinguish itself from Wal-Mart and Target, as it cannot always compete on price alone against major generic retailer. ROWE enabled the company to invest in this critical development.

The resistance, both organization and individual that the ROWE program had to overcome

Employees found that their quality of life improved, on and off-site. Pointless meetings that had existed mainly to fill time were reduced, employees were not vegetating at corporate headquarters, merely filling in their time slots, and time theft on the part of employees (such as shopping online on company time) became virtually nonexistent. But while Best Buy's CEO may have 'bought in' to the switch to results-oriented rewards, "there has been plenty of opposition inside the company. Many execs wondered if the program was simply flextime in a prettier bottle. Others felt that working off-site would lead to longer hours and destroy forever the demarcation between work and personal time. Cynics thought it was all a PR stunt dreamed up by Machiavellian operatives in human resources. And as ROWE infected one department after the other, its supporters ran into old-guard saboteurs, who continue to plot an overthrow and spread warnings of a coming paradise for slackers" (Conlin 2006). However, unlike flex time, which still requires a certain number of hours of employees, ROWE focuses on results. Metrics were essential in winning over opponents to the ROWE philosophy and once results improved, naysayers began to quiet their negative voices.

Discuss the sources of stress that are apparent in the case

Organizational changes will always bring about organizational stress. Any change will bring about cries of 'that's not how we do things here' from resistant managers. In the Best Buy case, change was even more fundamental and deeper, challenging the basic assumptions of how work was viewed in the 21st century. Work at Best Buy, as a result of ROWE, is no longer constrained to a specific place -- work exists 'outside' of time, and is measured by excellence alone. Work is about accomplishments, not punching a clock. By associating employees with their successes, not their face time, greater respect is given to the individual accomplishments of employees. This also indicates a shift in how employees are viewed and treated by managers. Employees who are productive in a concrete and measurable fashion become valued assets, and employee accomplishments are measured more closely than ever before through ROWE.

Before ROWE, there was grousing that some employees were shown favoritism, such as a manager with a 2.5-hour commute who was allowed to work from home on Friday, unlike other employees. But once all employees were given similar latitude, stress decreased rather than increased in the workplace.

Discuss whether or not the organizational culture has helped with the change

Best Buy's previously highly-pressured and high-investment culture may have facilitated the change. Employees were hungry for a more effective work-life balance. They had a strong incentive to want to make ROWE work for the company, so they could live better lives. Most workers liked the company and believed in the company, which increased their motivation to show results. Also, a sense of teamwork encourages employees to set new benchmarks for themselves, in their desire to succeed and best the competition in the next cubicle and also in competitor organizations. ROWE creates a more atomized workforce, but the company culture was cohesive enough so that the newly flexible schedules did not damage corporate morale.