Web-to-Host: The True Costs of Telecommuting

The network has become the workplace. The LAN is overlapping the WAN, which is overlapping the intranet, which is overlapping the extranet. Much of our organizations’ work can now be handled by telecommuters, road warriors, contractors and business partners. This is the sweet spot of the raging IT market, as every day brings a flood of announcements from vendors on solutions and devices that make data accessible to remote end users. It is also the driving force behind many Web-to-host sites.

The lines are blurring so greatly, in fact, that some organizations no longer bother to distinguish between telecommuters and physically present employees, except in the way they connect to the network.

However, the direct benefits and cost savings from remote productivity can be elusive. Some analysts calculate that remote and telecommuting workers may even cost more than their in-house counterparts – up to 150 percent higher. "Part-time remote workers can still incur high excess costs due to some redundant expenditures in equipment and access to support two alternative worksites," explains John Girard, Research Director with GartnerGroup. "Full-time remote users incur increased WAN usage charges, though costs can be mediated in savings in facilities closures."

Moreover, a recent survey from Olsten Corp. finds that while more and more companies offer remote work arrangements – 66 percent, up from 51 percent in 1997 – fewer companies are seeing cost-saving advantages to remote work arrangements. About 24 percent of companies saw cost savings from their remote work strategies, dropping from 35 percent in the previous survey.

"Telecommuting is not cheap. Providing home services and executive services are not cheap," says Peter Cregger, Vice President at SAS Institute, based in Cary, N.C. "Unless you have extremely high real estate and connectivity costs, it’s cheaper to support somebody in an office environment." Instead, SAS took the approach of providing uniform seamless integration to all employees, whether they are working from the road, home or in the corporate offices. "It doesn’t matter who you are; you have access everywhere."

That’s why it’s important to look beyond standard cost-savings calculations to sell Web-to-host strategies to your company’s management. The benefits come in ways that can’t be spelled out on a balance sheet.

Implementing Web-to-host on employees’ desktop environments will almost immediately help to streamline systems maintenance and upgrade costs. Remote workers using a browser interface expand the boundaries of TCO to new benefits, some not so easily measured – enhanced productivity, reduced space requirements and reduced recruiting and turnover costs. Telecommuting experts calculate an average productivity gain of about 25 percent for telecommuting employees that no longer have to schlep into the office every day. Then, there’s increased business value – that additional sale that someone may make because they’re more willing and able to contact a customer after 5:00 p.m.

Also, consider the costs of replacing or hiring new employees as part of the savings. For example, a call center, hard-pressed to find employees that can work late evening hours, may find its recruiting far easier if interested applicants can work from home. Insurance firms, looking for employees to handle mountains of claims-processing work, may find all the help it needs in a home-based workforce. Some data-entry-intensive occupations see turnover rates exceeding 30 percent a year, with a replacement cost of about $5,000 an employee. Imagine the savings if this turnover could be cut in half.

Surveys over the years have consistently shown that the employees most likely to engage in remote work include technical and sales professionals. However, Web-to-host promises to also open up e-work to employees engaged in heavy transaction work that requires persistent terminal access to a mainframe or midrange host. Tasks involving data entry can now be moved to home offices.

Remote Web-to-host may offer an additional TCO benefit in that it reduces or eliminates the challenges of back up and data security – sticky issues for many organizations supporting remote work. Since all data remains on the central server, back-up of data from remote laptops and PCs is not required.