Back to the future: Why some bosses ban working from home

I ran my company virtually since we opened in 2006, before working remotely was hot. We used technology to make that happen. But recently, my new COO persuaded me to make a radical move: Bring almost everyone back into our office in Los Angeles, just as controversial CEO Marissa Mayer did at Yahoo. That means most of our 100 employees must now hit the road each morning and work in a traditional brick-and-mortar office space.

It was a dramatic choice. When I hired my team, the understanding was that they would work remotely.

Jose Luis Pelaez Inc. | Blend Images | Getty Images

Jose Luis Pelaez Inc. | Blend Images | Getty Images

But my COO, who worked his way up through the ranks because of his smarts and drive, saw that our policy hurt us. With people spread out, it was hard to tap their power and the ideas that come from working side by side. Folks who were working at home were not participating in team discussions or hearing the latest updates on what is new and what not to do anymore. They were isolated, and they lost the energy and better communication that comes when people are face-to-face.

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And my COO felt performance was slipping. Revenues were dipping by about $100,000 per month. While some people on our team do a great job no matter what, he felt others would benefit from closer supervision. At home, it’s easy to get distracted by tasks like feeding the dog or surfing the Web. Some team members’ performance evaluations were declining. Their follow-up on projects was sometimes slower than we wanted.

He also wanted to do more training, something that is hard when everyone is dispersed. Some of the best training opportunities happen when someone nearby helps a team member spontaneously.

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We’ve had pushback since we told our team members last month that they had to come back into the office by this week. We are likely to lose a few people who can’t do it. Some employees feel their lives are being disrupted. In a city like Irvine, California, where we are based, working remotely does save people a lot of time on the road. We plan to keep hours reasonable so the team members with families don’t face high childcare costs. Most will work from 8 am. to 4:30 p.m. so they can beat rush hour and be back at home.

Will we end remote work completely? No. There will be cases where to maintain our competitive edge, we will need employees who are based far away or can offer extremely unique skills. For instance, we have one leader on the East Coast who does content marketing and works entirely virtually but performs well. But even in these cases, we will see working from home as a privilege that needs to be earned and reevaluated.

The bottom line: Sometimes leading a technology company means knowing when not to manage everything virtually.

—By Eric Schiffer, chairman of Reputation Management Consultants. Mr. Schiffer is an advisor to Fortune 500 CEOs and Forbes 400 billionaires. He is the author of “Emotionally Charged Learning” and can be reached at @ericschiffer.

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