May 5, 2023

Rewarding Performance in a Results-Only Work Environment

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Key takeaways:

  • A result-only work environment (ROWE) focuses on employee productivity, not time spent in the office or hours worked.
  • A ROWE can lead to higher job satisfaction, lower turnover, and better profits, but it’s not the right fit for every type of business.

Explore software that can help you shift to a ROWE model in our Performance Management Software Guide.

What is a results-only work environment?

A results-only work environment is an approach to company culture in which employees are rewarded for their work output, not the number of hours worked or their presence in the office. At a ROWE company, employees have a lot of autonomy over when, where, and how they work as long as they meet their goals. Employees also manage themselves rather than everything being controlled by supervisors.

The ROWE approach is more radical than flexible hours, which still requires employees to work a certain number of hours per week. It also doesn’t require employees to report to an office a certain number of days per week; in a ROWE company, work is something you do, not a place you go.

As more companies embrace hybrid and remote work opportunities as well as flexible working hours, many businesses are becoming interested in implementing a results-only work environment. However, ROWE requires a major company culture shift to implement successfully.

How do you implement a results-only work environment?

Ready to transition to a results-only workplace? Here are some of the steps you will need to follow:

  1. Hire the right people
  2. Build organizational trust
  3. Set measurable goals
  4. Track goal progress
  5. Maintain employee engagement

Hire the right people

In order for a ROWE to succeed, you need driven employees who are motivated to do their best and pursue continuous improvement. As you move forward on your hiring initiatives, prioritize candidates who demonstrate intrinsic motivation that will help them thrive in a ROWE workplace.

Implementing an applicant tracking system (ATS) can help you identify promising candidates and speed up the hiring process.

Build organizational trust

In a ROWE organization, a strong culture of trust is paramount. Not only does leadership need to have confidence in employees to get the work done without micromanaging, but employees also need to believe their managers are evaluating them fairly and not playing favorites.

Building trust and camaraderie can be tough when not everyone works the same hours in the same office, so get creative about team-building exercises you can do virtually.

Set measurable goals

Before tracking performance, managers must first set goals at the individual, team, and company levels. The goals should be consistent, clear, and measurable to ensure equitable performance ratings across team members and departments.

Each person should know what their responsibilities are and when their tasks should be accomplished — deadlines still exist in a ROWE model with flexible working hours.

Track goal progress

Once those clear goals are set, managers and employees will need to track progress toward them on a regular basis. If a team member isn’t meeting their goals, regular performance discussions can serve as check points to provide feedback and coaching.

Performance management software can help standardize and automate this process, making it easy to prioritize regular check-ins without requiring a lot of extra time and effort. 15Five, for example, provides a central dashboard for users to review progress toward all goals at a high level and drill down into the narrower targets that support each goal.

Dashboard showing four business-wide goals and the progress percentage toward each one; three goals are on track and one is behind
15Five provides high-level goal progress visibility to support performance management discussions. Source: 15Five

Maintain employee engagement

Poor employee enthusiasm and motivation can slow the transition to a results-only work environment. To keep employees motivated, implement an employee engagement program. Employee engagement consists not just of publicly praising and rewarding workers for their achievements, but also soliciting feedback from them in the form of anonymous surveys and taking meaningful action.

Advantages of ROWE

Among many benefits, ROWE enables companies increase employee satisfaction, reduce operating costs, and create objective performance management processes.

Increased employee satisfaction

One of the biggest advantages is the increase in employee satisfaction that typically accompanies a switch to ROWE, which can also lead to lower employee turnover in the long run. While there may be a brief increase in turnover in the beginning as employees who don’t like ROWE leave the company, turnover will drop and employee retention will improve as the remaining workers see the benefits of ROWE.

Reduced operating costs

The ROWE framework often helps companies downsize to smaller offices since more employees work remotely, or possibly get rid of office space altogether, saving significantly on rent. Meanwhile, remote employees save on commuting expenses as well as energy and time.

Objective performance management

A ROWE model focuses on employee performance rather than factors that are more easily influenced by unconscious biases. Concrete, quantifiable KPIs are more objective than criteria like culture fit and team leadership, thus creating a more equitable evaluation process.

Disadvantages of ROWE

ROWE also comes with potential disadvantages that may give companies pause, including less collaboration and communication, limited scope, and greater compliance risks.

Less collaboration and communication

Remote work can create challenges for highly collaborative environments to implement ROWE. Teams that are spread across different time zones or work vastly different schedules may experience communication delays that can hinder productivity.

Limited scope

ROWE principles may not be practical in some work environments. For starters, ROWE is not appropriate for customer-facing fields, such as customer service and retail, or employees who must be present at a job site, like office managers and maintenance staff. It’s also not suitable for new or inexperienced workers who need lots of training and support.

Greater compliance risks

ROWE’s work-from-anywhere policies can also result in compliance issues and tax complications. This is especially true if employees are working abroad or the HR department is inexperienced with these kinds of policies. ROWE can also sometimes backfire if it creates a company culture that motivates employees to engage in undesirable or unethical behavior in order to achieve results and meet targets.

Should you implement a ROWE?

Switching to a results-only workplace is a big transition, but it may pay off for your company in the long run in terms of higher job satisfaction, lower turnover, and better profits. The right HR software stack can make the transition easier and improve your performance management process. 

Check out our HR software and performance management software guides to explore tools that will help you get started.

1 Deel

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Deel is the all-in-one platform built to hire, manage and grow global teams. By bringing together cutting edge HR tools, payroll solutions, compliance and more, Deel enables companies to scale globally with unmatched speed and flexibility.

With Deel, you can hire and onboard any type of employee, compliantly, in 150+ countries in minutes. You can run payroll in 100+ countries and all 50 states in a click of a button. You can offer competitive benefits, equity, manage equipment and more.

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2 Rippling

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Rippling is the first way for businesses to manage all of their HR, IT, and Finance — payroll, benefits, computers, apps, corporate cards, expenses, and more — in one unified workforce platform. By connecting every business system to one source of truth for employee data, businesses can automate all of the manual work they normally need to do to make employee changes.

Learn more about Rippling

3 BambooHR

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BambooHR is an award-winning HR platform that helps your growing organizations automate, centralize, and connect your people data all in one place. It gives you a one stop shop to manage data, hire talent, run payroll, and help employees grow.

Learn more about BambooHR

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