Explore software that can help you shift to a ROWE model in our Performance Management Software Guide.
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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:
- Hire the right people
- Build organizational trust
- Set measurable goals
- Track goal progress
- 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.
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.
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.
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.
Paylocity is a different kind of HR and payroll provider. We partner with you to create great software that delivers on your unmet needs – solving today’s challenges and designing solutions for the unknowns of tomorrow. And we stay your partner with dedicated, on-demand support every step of the way. Build a better future for your organization with a scalable solution focused on your business outcomes and priced for your budget.
Justworks makes it easier to start, run, and grow a business by giving entrepreneurs and their teams access to big-company benefits, automated payroll, compliance support, and HR tools in one simple platform. Using Justworks means that you can focus on what matters most – running your business. Justworks also offers access to ancillary benefits like 401, life/disability insurance, workers' comp, and more, all seamlessly integrated into the platform. The best part? Justworks offers 24/7 support.