In April 1999, 19 workers at a PNC Financial Services Group operations center in suburban Philadelphia entered a seven-month pilot study in which they compressed their full-time schedule to four 10-hour days instead of a traditional five-day workweek. As a result, PNC reported productivity among the workers jumped dramatically while absenteeism and turnover declined.

	Stacy Innerst, Post-Gazette Click illustration for larger image.

More than five years later, the compressed workweek is still in place among the pilot group while throughout PNC more than half of its 23,000 employees take advantage of flex options, including the compressed workweek, telecommuting and staggering their daily start and stop times.

"If you engage employees and provide them with flexibility, they will be more committed to business and serve customers better," said Kathleen D'Appolonia, senior vice president, corporate recruiting for PNC, which began offering flex options about 10 years ago.

PNC's experience is one of several success stories highlighted in a study being released today that attempts to make a case for how flextime can positively impact a company's bottom line.

Conducted by Corporate Voices for Working Families, a nonprofit coalition based in Washington, D.C., and sponsored by the Alfred P. Sloan Foundation in New York, the study included information about employee flexibility options from 28 companies nationwide, including PNC and two others based here: Mellon Financial Corp. and Glaxo-SmithKline Consumer Healthcare.

While the companies surveyed said flexibility improved morale, reduced stress and generated more job satisfaction and less turnover, PNC was among those that provided hard numbers about how flextime directly affected its performance. At the end of its seven-month pilot at the Eastwick operations center, where employees' jobs include savings bond settlements and credit reference checks, PNC said work that had taken two days, such as follow-up inquiries, was being done in one day; absenteeism fell from 60 days to nine days compared with a similar work period; and the company saved $112,750 in turnover costs.

Among other companies that provided hard evidence to back up their claims that flexibility translated to better financial performance was accounting and consulting firm Deloitte Touche, which said it saved $41.5 million in turnover-related costs in 2003 by providing flexibility to professionals who said they would have left the firm if they didn't have those options.

Some companies resist flexible arrangements as a work force benefit because they consider them a way to accommodate only special situations or certain employees "who have good performance or family responsibilities," said Donna Klein, president and founder of Corporate Voices.

Because a sluggish economy and outsourcing have reduced the need for companies to dangle incentives in front of prospective employees, fewer companies are offering flexible work options as a benefit than they did just a couple years ago, said a study by the Society for Human Resource Management. That study said 56 percent of employers offered flextime this year, down from 64 percent in 2002.

By providing some documentation about the broad benefits of flexibility, Corporate Voices hopes to "help employers look at [flexibility] not as an accommodation but as a driver of financial performance," Ms. Klein said.

Ms. D'Appolonia at PNC acknowledged that many managers "have some initial concern about flexibility of this sort because they can't quite imagine how they're going to manage performance with different people there on different days. It could be a little daunting." But the productivity improvement among flextime workers at PNC coupled with better morale, Ms. D'Appolonia said, left "managers hard pressed to argue in the face of these results. It's quite compelling."

PNC, as part of a corporate cost-cutting initiative, bumped its standard work week from 37.5 hours to 40 hours in September without changing workers' pay. But it hasn't altered its flex options.

"These [flexible] arrangements are just as feasible with a 40-hour work week as 37.5," Ms. D'Appolonia said. "I think it's not so much the actual hours worked but the control you have over scheduling those hours."

After conducting focus groups throughout its organization, Mellon Financial Corp. launched formal flex arrangements in 2001, including compressed workweeks, staggered work hours, reduced or part-time schedules, telecommuting and job sharing. Managers in specific work groups determine whether their employees can take advantage of the options. Mellon doesn't formally track how many employees participate.

"From a corporate position we believe it makes good business sense because happy employees are productive employees," said Diane Doyle-Love, Mellon's work-life manager.

One Mellon unit that utilizes flex options is the client support division in Mellon Global Cash Management, where director Joanne Scheier said 75 of her 97 employees had some type of flex work arrangement; the most popular is working nine longer days in a two-week period and taking off the 10th.

Contrary to popular perception, many at Mellon who work flex arrangements are men, she said.

"I don't believe this is a woman's issue. I have many men using this option to balance elder care, child issues."

Turnover in Ms. Scheier's division has averaged less than 1 percent since the flex arrangements started in 2001, unplanned absences have fallen and customer satisfaction scores have risen, though she couldn't provide specifics.

GlaxoSmithKline's Consumer Healthcare unit in Moon launched flex arrangements about five years ago after testing the concept in a couple of departments, said Ernestine Harris, director of human resources.

The pilot program was so successful that the company now offers flextime to all of its 550 employees. Most employees take advantage of the option where they work core hours of 9 a.m. to 3 p.m. but can stagger their start and stop times. They also can work an extra hour Monday through Thursday and leave at 2 p.m. on Fridays, telecommute from home, job share or work part-time jobs.

"Sometimes it's hard to quantify the gains in productivity. But our employees are happy, more productive, more innovative and have a lower turnover rate," said Mrs. Harris.

Robert Kelley, adjunct professor of organizational behavior at Carnegie Mellon University's Tepper School of Business, said early efforts to offer flex schedules "created havoc" in some companies because there wasn't sufficient analysis ahead of time about how the work would get done while some employees weren't there.

"In manufacturing work or factories, you can't just pluck somebody out of an assembly line. But as things became increasingly automated, that became more of a moot issue."

Flexible schedules also were a challenge in offices "going back to when secretaries played a more pivotal role," Dr. Kelley said.

"The secretary was juggling everything. She did all the data inputting, so when she took flex time, everyone was sitting there wondering, 'When do I get my stuff?' "

In most cases, though, flexibility "is giving people more control over their total lives and letting them fit work into life in a way that makes sense to them," Dr. Kelley said, noting that it's not just an issue of importance to women. "It's become increasingly important as there are more pressures on people's lives: both partners are working, child care and parent care."

Because so much work is now project based, he said, flexible schedules "allow us to say to people, 'You're not working these hours, you're working these projects so if you want to work at 2 a.m., go ahead and do it.' " In that way, flexibility can benefit the employer. "It's a better bargain for them because on a project basis, people may actually put in more hours ... and they often do."