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F International: Twenty Years' Experience in Homeworking V. S. Shiriey Independent of any computer manufacturer, F International (FI) offers a comprehensive range of data processing services, in- cluding consulting, project management, hardware and software evaluation, business and systems analysis, design, specification writing, software development, user and technical training, and computer installation support. Eight hundred fifty people, most of them women and working part time, are involved worldwide. Nearly all work from home. Revenue derived entirely from services, and not from hardware or products, is $10 million. This characterizes F! as a smallbusiness. What is different about F] is that the whole business operation takes place in people's homes. F! started off doing entirely what is now called programming, the development of software. Today, less than 40 percent of our work involves the development of software and, of this, 30 per- cent is on-line, using telephone lines to connect technicians to a computer center. Now that computer technology is geared to interactive termi- nals, home-based workers go on-site more than when batch pro- cessing, submitted overnight and sometimes even by post, was standard practice. F] homeworkers have accepted this trend be- V. S. (Mrs. Steve) Shirley is founder and president of F International. 51
52 CASE STUDIES cause homework does not satisfy all their needs for stimulation and social contact. In time, as computer equipment and communi- cations become less expensive, the pattern may well turn full circle. In a typical month we handle 200 computing and telecommuni- cating projects for 120 clients, generally Fortune 500 companies. Projects involve as few as 2 people working together or as many as 75 people, sometimes working in more than one country. The smallest team consists of two workers because every project even in a consulting environment must be strongly managed. A project may last six weeks or more than three fiscal years. It may peak at 50 people and then die down. A project may be can- ceHed suddenly, within a month, 30 people become available and have to be scheduled for other work. As a consulting company, FI must show a profit and make its cash work in order to survive. All FT employees are effectively home-based and working in a managed environment to make each project profitable. It's working: we get a phenomenally high 66 percent return on capital employed. In addition to its size, F} differs from other case studies in that it started with the idea of homeworking. F] employment policy is to utilize (not necessarily employ) whenever and wherever practi- cable the services of people (not necessarily women) who are un- able or unwilling to work in a conventional way. In different coun- tries and at different times, the conventional way may vary. For example, the way we appear in New York, where we now have a small office operating in a build-up mode, may differ from the way we operate in a European city where the work Toad has stabilized. Three quarters of the staff work freelance on a project-by-proj- ect basis generally related to client needs or internal needs such as computerizing the FT accounting system. The panel of available freelance people is considered part of the corporation and works in a flexitime mode from individual homes. Members of the F! work force are predominantly women Took- ing after young children or elderly family members, disabled peo- ple, and men and women who choose to work at home because they like it. F! includes husband and wife teams, couples who have chosen to reverse the conventional division of child rearing and money earning, and people who purposely seek the flexibility to pursue other occupations. Flexible employment contracts that accom-
F INTERNATIONAL 53 modate other life interests allows people a freedom not often expe- rienced in other organizations. Managers are homegrown as well as home based; very few have come in from outside. The FT aim is to offer careers, not just work. Once we have successfully inducted people into the organization we expect to retain them for many years. Eighty-nine percent of our workers have been with us for more than 1 year, 34 percent have been with us for more than 5 years, and ~ percent for more than 10 years. Each very skilled worker has a minimum of four years data processing experience and is inducted into the freelance pane] as carefully and as seriously as are the full-time employee staff members. The typical work schedule is unexpectedly unlike the home- worker stereotype. Time and place vary, but workers generally average 20 hours during a 7-day week. Panel members are allowed to turn down assignments, but once committed, they show a great deal of professional dedication to a project. Although fixed hours are not required there is a tendency for homeworkers to set their own. Training is often done on weekends. Ninety-six percent of the work force is female, largely because the opportunity to work at home attracts a large number of peo- ple, like myself 20 years ago, who want to continue working from home while caring for their families. A quiet, uninterrupted work area is essential for creative soft- ware development. Working from home makes a telephone essen- tial, but few FI homeworkers have a mass of electronic gadgetry. FT has experimented with visionphones and teleconferencing and is investigating Micronet, which uses personal television sets, on which F International might base a crude wide-area network. One workstation customized for a disabled person working 20 hours per week on an administrative task cost $35,000, but that is unusual. Any equipment provided for home use by F1: is always paid for and insured by FT. People do have microcomputers at home and, increasingly, their own personal computers. This is changing the way in which work is done. A consulting project may, for example, involve the reworking of a voluminous report with appendixes and many dia- grams. Formerly, these began as dictated tapes or manuscripts, given to a pool of stenographers who worked at home on a series of compatible typewriters. The FT typing pool peaked at 16 home- based workers in 1978. It has since been displaced by advances in
54 CASE STUDIES the technology. Consultants now key their text into their own per- sonal computers. There also are word processors in the central offices. All F] offices have compatible equipment, and straight copy typing work done at home is no longer economical. FT maintains 10 offices worIdwicle. European operations are di- rected primarily from five regions in the United Kingdom plus associated companies in other countries. In Scandinavia FT oper- ates in a business house with relatively sophisticated telecommu- nications equipment. F! also operates in Holland, where the labor laws do not allow a company to engage people on a freelance basis, but require that workers be employed in an artificial series of fixed-term contracts. FT started in the USA early in 1983, but the connection goes back to 197S, when there was a friendly association with a U.S. corporation with branches in New York and California, estab- lished under a 2-year license from F International. After a profit- able growth phase, the firm dropped to one branch and incurred losses. The corporation merged very painlessly into F]: early in 1983 and now operates from small offices in Tarrytown, New York. F International's American operations differ from the Euro- pean. In the United States the work force is only 84 percent women. Far more American workers hold degrees, far more have their own equipment. The work force is more mobile and more oriented toward sales than toward project management. We believe strongly in project management because this is what our multinational clients want. The fact that work is done at home is almost incidental to the corporate service. As a business entity, we do all the things that any firm does the whole corpora- tion is a homeworking one. The characteristics of full- and part-time, office- and home- based, salaried and freelance are interpreted as independent vari- ables so that all combinations of characteristics occur. Only 5.75 percent of the work force is conventional, i.e. salaried, office- based, and full time. In the first quarter of the fiscal year 1983 the average of weekly hours worked, including travel time, was 17.1, with 35 percent of that time spent at home. These figures indicate the very part-time and still relatively remote nature of the work force. Communications are highly dependent on telephone and postal services and on a few key people, mainly executive secretaries,
F INTERNATIONAL 55 remaining in relatively fixed locations at fixed hours while the rest of the organization revolves around them. Technical bulletins Inch newsletters help spread professional and personal informa- tion through the network; these are circulated by post and courier services, as are a multiplicity of papers, files and memoranda, cas- settes, and, occasionally, floppy disks. Telex, telephones with answering equipment, and, most re- cently, telecopiers are used heavily. While operating facsimile equipment is still much like watching grass grow, F] gets enor- mous value from distant colleagues being able to transmit scrib- bled notes to each other. Such equipment not only spans the time differences between countries but also protects people's privacy at home by, in effect, preserving work messages until the home- worker chooses to deal with them. F International is still a private corporation, though the equity is being slowly transferred for the benefit of the work force. Pre- tax profits have averaged 11 percent where the industry norm is 9.5 percent. That is not luck, but good management and high pro- ductivity, which ~ believe uniquely demonstrates the economic success achievable among a network of people linked by trust as wed as by telecommunications. Because we are involved in an ever-changing technical field, a significant part of F] revenue is spent on ongoing retraining of workers. Training is also important for developing our own man- agers, including those at the top. After 20 years in practice, the FT approach has revealed weak- nesses as well as strengths of home-based work. The weaknesses include: 1. The bulk of the work force, the panel, is relatively immobile and does not provide a source of future management. 2. Communications, both horizontal and vertical, and facilities for gathering opinions and ensuring an understanding of strate- gies and policies are necessarily formalized and extremely expensive. The strengths include: 1. The employment philosophy is very much in keeping with the free enterprise trends of the Western world, and F Interna- tional has developed a method of management and project control
56 CASE STlIDIES that enables its multinational teams to work effectively and eco- nomically within this philosophy. 2. The need for new management personnel allows people to develop effective management styles without having to unlearn practices that are inappropriate for teleworking. 3. Overhead costs are variable, not fixed, since they involve management and communications rather than rent and rates. 4. A professional approach to project development and control is an obvious need and is widely accepted rather than resisted. 5. F International has access to a skilleci, self-disciplined work force in short supply. 6. High-caliber people give exceptional performance and value when they are trusted and managed well. 7. Productivity has proved to be significantly higher than average. FT is not an experiment. It is different from most trial home- work projects because it is almost 100 percent home based; it is predominantly female; it is a first generation, entrepreneurial company just moving into a professional management mode. It is not a prototype; it is not a pilot study. It is a business operating in a new way.