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Is Marissa Meyer's Work-from-Home Policy the Right Move?

Marissa Meyer is a rock star in corporate circles. She garnered much attention when she moved on from a highly successful stint at Google—where she was the highest-ranking female engineering executive—to join floundering Yahoo!.

Meyer created a small stir when she returned to work only two weeks after giving birth to her first child. Now her actions have elicited an outright uproar over a leaked memo from HR announcing that virtual working would be banned starting June 1.

Many have criticized the policy as a step backward in the cause for working women and indeed all workers seeking a better balance between the demands of a hectic home life and an all-consuming career.

The rationale ascribed to this action is Meyer’s desire to improve collaboration and innovation at Yahoo! But assuming for a moment that her decision is justified, one question that needs asking is whether this is actually a good policy for increasing innovation and collaboration.

Meyer comes from Google, a company famous for its innovative products and services and lavishing all manner of perks and conveniences on its employees to keep them working onsite so they pump out the next new big thing. Rather than provide work-life balance, it seems Google tries to eliminate the distinction between work and home for its brainy staff. Another innovation icon, Apple, apparently takes a dim view of telecommuting as well.

But in a world increasingly dominated by global markets, global talent and 24x7 business, it doesn’t seem realistic to co-locate workers in a single place. Truth is that for some time now, companies have had to learn how to collaborate and innovate virtually across time and space. Few doubt that working in the same physical space provides critical opportunities for bonding among staff, knowledge sharing and informal interactions that enhance creativity and new ideas. But the hard truth is that many companies today have no choice but to get good at collaborating among not only dispersed workers (they may all be in offices but in different locations) but with customers, service providers, suppliers, consultants and university researchers—all in different physical locations.

To be successful, companies have to be able to work virtually with all these stakeholders.

Other technology companies have long had success using technology to tackle this challenge. One well-known example is IBM, which holds more patents than any other company in the world. It conceived the idea of a “Jam”—a “massively parallel online conference”—in the early 2000s to promote innovation among its staff worldwide, many of whom were working at home or at client sites, rarely going to IBM offices. The idea was to use an online system to collectively brainstorm substantive answers to important questions in three days or so. It was hoped this would not only give people a sense of participation and of being listened to, but generate valuable new ideas as well. From the beginning, the Jam process showed it could engage tens of thousands of people at a time and lead to actionable ideas and solutions.

Today IBM uses collaborative and social networking technology to “micro-jam”—to brainstorm among employees to solve client problems. For example, after spending a day with a client, questions are put into an online forum of an IBM knowledge community. Staff from all over the world start brainstorming, and the next morning the IBM team has multiple draft solutions to present to it client.

IBM is just one example of how companies that master virtual working improve their global innovation capability and performance. Further evidence is supplied by the latest unpublished research on innovation from i4cp that revealed that some of the practices with the highest correlation to market performance involved collaborating virtually and with external third-parties.

Of the over 20 human capital practices used to drive innovation we measured, “Uses technology-enabled collaboration or social media tools to share knowledge” proved to have the highest correlation to market performance. It was strongly linked to innovation effectiveness as well.

This may surprise some, but it suggests that virtual collaboration capabilities are now must-haves for organizations and that mastering them has a hard pay-off in improved performance. Indeed, 36% of high-performance organizations in the study indicated they were highly effective in using virtual technologies and social media for collaboration and knowledge sharing compared to only 13.5% of low-performing organizations.

Ironically, Yahoo! is a technology company that provides tools that can be used for virtual collaboration (Yahoo! Messenger, anyone?). It should have an advantage in using such tools internally to collaborate and innovate. Doing away with virtual working among its employees may not only be a public relations problem but a warning sign that the company is incapable of adapting to the realities of a global business.