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Monday, June 28, 2010

can I run my business with a 4-day work week?

A reader writes:

As a future employer (I hope!), I have an idea that I've been kicking around in my mind for awhile. I feel that a five-day work week is stifling and that people in general would be happier with a four-day work week at approximately 32 hours a week. 

However, in my scenario, this would be considered full-time: such employees would qualify for benefits through the company, and the wages (much of the initial staff will be exempt; however, I would apply this to hourly workers as well) would be roughly equivalent to working full-time. I believe in the living wage and it would be important to me to do right by my employees.

Is this just pie-in-the-sky thinking? Is it feasible to run a company like that, provided that the CEO is not making $5 million a year (in any for-profit business I owned I would have salary caps, I think, but this particular adventure would be a non-profit, so the salary caps kind of come with the territory anyway)? Do you think this would be reasonable, and welcomed?

Can it work? Absolutely. Will it work? That depends.

Things to think about:

* If you're going to shave off 20% of the standard work time, are you going to expect your employees to work harder/smarter in order to achieve the results that another organization of the same staff size would get with five-day weeks?  With a strong culture, strong management practices, and great people, it's feasible that you could achieve that, but you'd need to have a plan for how you're going to build that culture, find those people, and achieve that high bar.

* Or, if you don't have those things and instead are a more typical organization, does that mean you'll be producing at 80% of the rate you'd achieve otherwise? Are you okay with that? Alternately, are you willing to hire additional employees if that's what it takes to get your productivity up to what it would be with a longer work week?

* As a nonprofit, you have special obligations: Your donors are donating money to support your mission because they want to see it realized, generally as soon as possible, and you're accountable to them. If you're not getting results at least at the same rate as similar organizations, but you're paying similar salaries, a smart donor is going to send their money somewhere else. To attract donors, you'll need to be able to show that it's not going to take you 20% longer to get the same or better results at the same cost.

* Nonprofits also tend to have workloads far higher than their staffs can juggle, and in many cases have staffers who work long hours (depending, obviously, on the organization). Most of them are looking for ways to fit in an extra 20%, not shave it off. Is a shortened work week realistic for the mission you're setting out to achieve? Will you have to compromise on your goals or shortchange the interest groups you're serving?

Now, if you can pull this off without sacrificing results, it would be a huge recruiting and retention tool for employees. But the key would be to execute it in such a way that you're not losing the performance-oriented culture and drive for results that characterize high-performing organizations. So you'd want top-notch managers, really rigorous hiring practices, high performance standards, a willingness to let go of people who don't meet that bar, and a culture that reinforces that drive to achieve.

What do others think?

26 comments:

Karen F. said...

I think the key to the reader's success is the people s/he will choose to embark on this plan. Let's face it, a lot of our job seekers out there are used to the grind of the 5-day workweek. But I know there are people out there who will move mountains to have that extra day for themselves and/or their families, provided the pay and benefits are competitive and commensurate to a regular 5-day workweek.

Find likeminded people who will deliver and you will have the successful company you dream of.

Another thing I would recommend is to lay out the infrastructure needed and acquire the tools your team needs to get everything done within 4 days instead of 5.

You'd have to think about what tools you need to monitor their productivity without getting too in your face, either. Some incentives on getting things done in 4 days or less may be in order as well...just to keep it going.

Finally, you need something in place to handle your contacts on the days you are not available...because while you may be running on a 4-day workweek, majority of the world still runs on 5 (or more).

Karen, The Resume Chick (on Google or Twitter for questions, comments or violent reactions)

Andrea said...

I have been lucky enough to have a worked a four day week in the past, and it was awesome! However, I think AAM is absolutely right in considering productivity and objective goals. In my four day work week, I had to work longer days to make it to full-time hours, and even if "full-time" was acceptable at 32 hours a week, it would have been impossible to get it all done had I not worked 10 hour days. On the other hand, since you would be starting out with a four day/week policy, you might be able to organize and structure your daily business such that it can be worked in four eight-hour days instead of five. In my situation, the workload had been worked previously in the normal schedule, so we had to work extra hard to get everything to fit in the shorter day. But since you can control how it goes from the outside, maybe it will work better for you. Overall, though, I think four-day work weeks are wonderful and should indeed be utilized by more companies. Best of luck!

Dave said...

If your employees are facing a lengthy commute, that one day per week they aren't spending in traffic is a huge perk. That being said, if you are working at 80% and your competition is putting in 100%, you are starting off at a disadvantage. Maybe a good compromise is that you only expect 32 hours in the office, but there is a level of output that is expected. This may require exempt employees to work extra hours on the 4 days they come in, or it may require them to work from home on the 5th day, but either way, it is preferable to coming in from 8-5 every day. Before you go for the shortened workweek (32 hours), maybe you should consider a compressed workweek (40 hours in 4 days) and see how your employees respond.

You will find that employees also enjoy being able to make more of their weekends, as short trips are much easier to take on a 3-day weekend, or even a 4-day weekend when Monday is a holiday.

Anonymous said...

Dave basically took the words out of my mouth -- a 4-day 40-hour week, or a 5-day 40-hour week where employees can spend one of the days working from home. One of my friends was once lucky enough to work a job where she had to be in on Wednesdays for at least 6 hours, but could work the other 34 hours of the week anytime she wanted.

ANY flexibility in hours and scheduling is going to be considered a HUGE benefit by almost anyone.

GeekChic said...

I work a 4 day work week right now (only 37 hours needed for full-time though) and can tele-commute as I wish with the exception of two monthly meetings.

I am just as productive as my colleagues (if not moreso) and I'm also willing to do work that can only be done in the wee hours of the morning (like data loads).

As for the business being out of step with the regular schedule... if you're good you can get away with it. The great NY photo and electronics store B&H is closed on Fridays after 2:00 pm and all day Saturday. They don't even process web orders. Why? They're Jewish. Hasn't hurt them in the 30+ years they've been open.

GeekChic said...

I currently work a 4 day work week and tele-commute as I wish - save for two monthly meetings. It's great for me and for the company.

I get rest and more time to myself. The company gets just as much work as a full-timer (37 hours here) and someone who's willing to do tasks late at night (like data loads).

As for your company being out of step with the regular work week. You can get away with it if you're good. B&H (a great photo and electronics store in NY and on the web) closes Fridays at 2:00 and all day Saturday. They don't even process web orders. Why? They're Jewish. It hasn't hurt them in the 30+ years they have been operating.

Anonymous said...

In addition to the things AAM mentioned, you need to be available when your clients or customers expect you to be. Most people expect business offices to be open M-F 9-5. It can be very frustrating to not be able to reach an office person, and your customers might give up if they can't.

But if you do decide to go this route, you might consider flex schedules. Such as 8 1/2 hr days with every-other friday off. Or 10 hour days with every friday off. Or 'core' hours of 10-4 with employees being allowed to work from home. Or any 80 hrs within a 2-week period. This way, you keep the same productivity while still offering the benefit.

Keep in mind childcare services and after-school programs rarely offer the flexibility offered above. The costs of having a child stay even ten minutes late are exorbitant. So have a regular 5-day/40-hr schedule available for your working parents.

Anonymous said...

Depending on how many people do the same job or can cover for each other, why not mix it up? Some employees can work Monday to Thursday and the others work Tuesday to Friday. Everyone gets a 4-day week and you have at least basic coverage all 5 days. You could even rotate it so you would work Tuesday to Friday one week and Monday to Thursday the next week resulting in a 4-day weekend every other week! My teammates and I were going to suggest this to our boss but we've recently been cut to the bone so there aren't enough people now to make it work:(

If you can't figure out a way to swing the 4-day week, I would still focus on flexibility in general - working from home, leaving early or coming in late to run an errand or go to the doctor\dentist, adequate vacation time, etc. I've often heard my co-workers, especially those with children or aging parents, say that our flexibility is the ONLY reason they don't leave our struggling company. Lots of interviewers promise flexibility but there are many definitions of what that entails. My boss basically says as long your job gets done and you don't whine about the occasional after hours work, do whatever you want.

Mike said...

I'd like to point out that sub-40 work weeks are the norm all across Europe, so perhaps finding management resources dealing with that environment would be in order?

To be perfectly honest, there's little reason why we all can't have schedules like that.

Kim Stiens said...

OP here. Thanks for all the comments guys!

First, the structure of the business would be a little different anyway, since we'd probably also want to be running at least Saturday and possibly also Sunday. So we could have one person M-Th, and someone else W-Sa, etc. There would be four executives/managers, so it would be easy to maintain manager coverage even in a 7 day week, provided of course that the work is getting done.

AAM brings up some interesting points. We'd be a member organization with significant dues, so the perception that we're working well and achieving our mission would be very important and visible. Do you guys think that a four day work week culture would have any automatic associations, either positive or negative, for potential members?

Danny said...

I agree with everything AAM said except for this: "As a nonprofit, you have special obligations: Your donors are donating money to support your mission because they want to see it realized, generally as soon as possible, and you're accountable to them. If you're not getting results at least at the same rate as similar organizations, but you're paying similar salaries, a smart donor is going to send their money somewhere else. To attract donors, you'll need to be able to show that it's not going to take you 20% longer to get the same or better results at the same cost."

This isn't unique to non-profits; you'd have the same fiduciary responsibility to your investors and shareholders in a for-profit company.

Anthony said...

As Anonymous at 11:50 said alternating some peoples schedules (Some MON-THUR, some TUES-FRI) will insure coverage of normal operating days. But also you could set the possibility of a four day work week as an option for employees. Give them objectives that must be met, and then they could choose whether this is completed in a 4 day work week, or a 5 day week. So I guess the main issue would be flexibility. This give the employee the freedom to choose the path that is most effective for them.

Anonymous said...

Re: positive or negative associations: Younger people, parents, and anyone who's ever been the primary caregiver for a sick person or an elder will probably think a 4-day work week is a miracle. Almost everyone else will probably think it's lazy -- at least until you can show (by quality and quantity of output) that your business ISN'T lazy.

It will help that the business itself will be open 7 days, not 4.

Anonymous said...

Maybe I'm a bit cynical here, but really. In most companies i've been in, employees aren't giving 100% all 40hrs they work anyway.

Cut it down to 32 and enforce the culture that everyone actually DOES give 100% while they are there and you'll get the same amount done as the majority of companies that have people on staff for 40 hrs.

Pregnant Yuppy said...

I switched to a 4 day work week last year. My productivity has increased while my hours of work has decreased. I know what I need to accomplish in a given week, and I am motivated enough to do so.

The key to making a 4 day work week successful is to find the right employees. I know of so many people who would be only 80% as productive.

As an employer I would clearly outline expectations and be sure to have regular performance evaluations.

BTW - kudos to you. I think that more companies should be open minded in this way.

Interviewer said...

Chick-Fil-A is closed 1 day out of 7, since the owner firmly believes in giving that day off for family, church, etc. There are some huge estimates on potential revenue that company could make if they were open 7 days a week, but he's committed to that path and his employees sincerely appreciate it. I'm sure their families do, too.

It sounds like your path would be different, since you would operate 7 days a week and your expectation is everyone covers for those who are out. Something to consider in setting up the work - if I'm covering for people who are out, when do I get my own work done?

Rachel B said...

Kim, I'd consider wait times. We have a manager who works Wednesday-Saturday. If a vendor or employee reaches out to this person over the weekend or early in the week, these requests aren't touched until mid week at the earliest. This can be frustrating to a person who works Monday-Friday.

That said, I would love a four day work week. If implemented correctly, it could really help with staff retention.

Anonymous said...

Consider ditching days/hours completely and check out ROWE:

http://gorowe.com/

Define your outcomes clearly and let your employees figure out the best way to accomplish them. (If you're concerned about "coverage," make one of the outcomes response time to email/voicemail/etc.)

Street Philosopher said...

Maybe staggered schedules keeping the organization open with fewer people each day? Or alternate so some are off Mondays, some off Fridays as their 3rd weekend day?

This could address the issues of investors and/or benefactors assuming a four day work week implies a downgrade in productivity, while increasing the interest in investing in your mission through fair and even above-par employee relations.

New ideas are crucial to keeping businesses competitive in our strange and ever-changing corporate environment, which seems to be calling for a more personalized way of negotiating productivity with manager and supervisor accessibility and understanding. Great way to think outside the United States framework of what work really means.

Anonymous said...

But.... Would people feel obligated to work on their 5th day anyway? I know plenty of people who will take Friday off, but then get stuck answering emails or doing work - you should consider the substance and volume of work before making it "4 days".
anon1130

KellyK said...

Anonymous at 11:10 beat me to it. The best flexibility you can give your employees is total flexibility: here are your obligations and goals, now you go decide how and when to achieve them. A results-only work environment sounds like a really good fit for what you want to do.

I think going ROWE would actually alleviate a lot of the concerns others have expressed about output, because people will figure out for themselves how they're most productive and can still do the other things in their lives.

Also, scheduling on the assumption of a specific number of hours doesn't account for the fact that some days or weeks might be busier than others, depending on the nature of your business and on people's roles. There are weeks where it takes 50 hours to do a decent job and weeks where it takes 20 or 30, and they don't always come conveniently back-to-back to make the timesheet math work out.

KellyK said...

One more point about meshing with the standard business week is that it really depends who's trying to contact you when will be most convenient for them. People contacting you in the course of their own work (vendors, other non-profits, etc.) are more likely to call weekdays during the day. People contacting you outside of work (volunteers, potential donors, etc.) will probably find evenings and weekends more convenient.

Whatever schedule you end up using, people will inevitably want to get a hold of someone when they're not there. So, I'd suggest having people are cross-trained: "oh, it's Tim's day off, but Peggy or Fred can help you with that." Also, whatever schedule or hours of operation you use, it needs be in a prominent place on your website, etc. (Employees with varying schedules, if they're sticking to a strict schedule, might want that info on their business cards. If they are scheduled more loosely, they might just want a couple possible numbers and an e-mail address.)

strbuck4 said...

I would also look at websites like Charity Navigator. A lot of how they rate charities and non-profits is by overhead cost vs. how much money you put to programs for your cause. A four day work week could cut your rating, but having employees telecommute is a great way to cut the overhead of a large office structure. I think it is important to look at sites like this in general as a rule of thumb for starting a non-profit.

Anonymous said...

Another thought--it's not just customers/clients who need to get ahold of staff, it's other staffers, too. If people are all working different 4 days out of the 7, that's a challenge that would need to be addressed.

I suspect that plenty of people would be happy to provide telephone or email availability on the out-of-office days if it meant getting out-of-office days, though.

Anonymous said...

A couple of Swedish county councils have held trials with 4 on3 off weeks for their full time employees in care and health.

The employees made sacrifices by not necessarily having their days off over weekends. (i.e having their weekly rest with at most one day being at the weekend) The employers made sacrifices by retaining the salaries for fewer work days.

Did it work?

On several levels it was a huge success: first of all number of sick days plummeted.

Short note on sick leave in Sweden: the first day of a period of illness is completely unpaid to discourage post weekend blues or World Cup sick leave, but there is no cap on the number of days you can have.

Employer pays for first fourteen days at 80% and anything past that is paid with tax money and requires a doctor's note)

Expenditure for sick leave and temps was dramatically cut. Win!

But surely they got less done? No - it turned out that well rested employees got more done in shorter time using fewer people at a time. Win!

The 3/4 system meant that weekends weren't short staffed as compared to week days anymore, so Monday staff didn't have to start the week taking care of stuff that didn't get done over the weekend. Win!

Holiday coverage was better and fewer temps needed. Win!

With so much win, they must have chosen to keep this system, right?

Of course not. The program was decomissioned after three years where they could show an exponential decrease in sick pay and temp expenditure without losing productivity and an increase in staff retention and easier recruiting - care is notoriously difficult to recruit for.

Qualitative interviewing of the staff showed much increased feeling of fulfilment and feeling good about the job. More volunteer work was being done in the area and hobbies were turned into lucrative extra income.

No good reason was given, when pressed as to why the local government said that: basically it was unfair to types of jobs where it couldn't be implemented, unemployment expenditure in the area increased as fewer temp jobs were going and a minority of the employees resented not being assured to be off Saturdays when friends and family are. Personally, I think it is just outdated Lutheran ideas about work ethic: basically you are supposed to spend much time at work, even if you get less done, and you are supposed to feel a little crap at your job. Otherwise we get morally outraged, or something. I know it sounds silly, but work ethic is very strong in Scandinavia and the average Joe (Svenne Banan) really resents the idea of frivolously spending less time at work.

End of tangent. It was just to illustrate how culture can keep a good model down. Thing is, the two day weekend is a fairly recent innovation. In the sixties when Sweden got given the two day weekend (Saturday was a regular work day and a half day in school)people were outraged and bewildered. What were those lazy employees going to do with all that free time? How would companies thrive with no people on Saturdays? Satirists wrote sketches about how people wasted their Saturdays and the Temperence movement warned of upcoming binge drinking. Turned out people spent their Saturdays tending allotments, singing in choirs, visiting museums and libraries and above all: pursuing higher education, usually engineering degrees, through Liber Hermod. The result, among other factors, was unprecedented prosperity in a country that was previously mostly agrarian.

To my mind, if the difference in expenditure and productivity is +- 0 then it is worth pursuing, simply because more people will be happier at the same cost. Win-win.

Not every company can work like that, but those who can should really try it.

Kind Regards,
Jessica

Jason Webb said...

That is awesome: I think it just goes to show how many different jobs there are for people to do. Everyone should be able to find something they enjoy doing to work at.