Ctrip: A Remote Work Success Story
Ctrip is a Chinese travel service founded in 1999 that provides accommodation reservations, transportation ticketing, packaged tours, and corporate travel management. In 2010, Ctrip launched a remote working experiment that would prove highly successful and lead to changes in the company’s working policies.
The executives at Ctrip decided to implement remote working as a way to reduce office costs. Executives thought they “…could save money on space and furniture if people worked from home.” However, they imagined that working from home would “…lead to a large increase in shirking”(NBER). But they believed “…the savings would outweigh the productivity hit it would take when employees left the discipline of the office environment” (HBR). Employees had different concerns about working from home. They “…worried about the isolation of working from home and that it would reduce their chances of promotion” (NBER).
Ctrip began the experiment in remote working with a group of volunteers from one of their call center locations. 503 employees volunteered to work four days each week from home and one day in the office for nine months. 249 of these employees worked remotely, while the rest remained in the office as a control group. In order to work from home, employees needed to have worked for at least 6 months at the company and they needed a private room with broadband access to work at home . Employees worked at the same hours at home as they had in the office on the same equipment in order to only measure the benefit of the change in working environment.
Based on Ctrip’s original goal for the remote working program, to reduce furniture and space costs, the experiment was very successful. “It estimated that it saved $1,900 [on furniture and space] per employee for the nine months” (HBR). There were many other benefits. At the conclusion of the 9 month experimental period, survey responses and performance data “… revealed that, in comparison with the employees who came into the office, the at-home workers were not only happier and less likely to quit but also more productive” (NBER). The home workers’ completed 13.5% more calls than the staff in the office, “meaning that Ctrip got almost an extra workday a week out of them” (HBR). Home workers also quit at half the rate of the in office workers, which was not an anticipated outcome. However, promotions conditional on performance fell by about 50% for the home workers (NBER).
Employees stated that their productivity improved due to quieter workspaces, not having to commute, not having to take as many sick days, and not having to run errands at lunch. However, working remotely was not for everyone, some employees opted to work in the office again after the trial. Overall, the remote working experiment was a success. Although some people still work in the office, the flexibility of remote working allows many employees to be more productive at home.
Researchers made the point that call center work is easier to measure and more conducive to working from home than other professions. They suggested, “More research needs to be done on creative work and teamwork, but the evidence still suggests that with most jobs, a good rule of thumb is to let employees have one to two days a week at home. It’s hugely beneficial to their well-being, helps you attract talent, and lowers attrition” (HBR). Researchers also found that people with more established social lives, especially workers who are older, married, or who have children are more likely to choose to work remotely. Younger workers seem to have social lives more strongly tied to the office, and therefore do not want to work from home as often. Following the study, researchers proposed that companies experiment with remote working before transitioning completely. One method is to measure productivity on days where bad weather prevents people from commuting. Another way to is allow employees one or two days each week to balance collaborative time in the office with quiet and productive work time at home.
Overall, Ctrip provides a great example in how to implement a successful remote working program. They were clear about their reasons to start the remote working program, their goals for the program and concerns from management and the employees. They created and tested a hypothesis for a predetermined time period, and then applied the lessons learned to the company as a whole. Any company who hopes to implement their own remote working program would benefit from following Ctrip’s example.
Sources
HBR To Raise Productivity, Let More Employees Work from Home
NBER Does Working From Home Work? Evidence from a Chinese Experiment
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Originally published at www.yonderwork.com.
