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2015
Evans, Matthew
Allegis Group

12/3/2015
Crowding in the Workplace
 Allegis Group
TO: Toby King, Vice President of Allegis Group
FROM: Matthew Evans, Tax Analyst
DATE: December 3, 2015
SUBJECT: Research Report: Crowding in the Workplace Proposal

Thank you for the opportunity to pursue research to develop whether the implementation of a
telecommuting program to permit employees in suitable occupations to work from home on a
full-time basis is viable for our business operations.

In the following report, I have provided evidence to support the benefits of executing this new
system, complete with a timeline and budget.

I am looking forward to discussing the report further with you as well as answering any
questions or concerns that you may have regarding it.

3720 Coca Cola Drive – Hanover, MD 20323

Phone: (410) 579–8789 Website: Allegisgroup.com
 Table of Contents

Executive Summary 1
Research 2
Introduction 2
Case Study – Ctrip 2
Solution 4
Telecommuting Program 4
Preliminary Details 4
Budget4
Implementation 5
Alternative 1 – Lease More Office Space 5
Alternative 2 – Relocate Employees 6
Conclusion 7
References 8
Overcrowding in the Workplace 1

Executive Summary

As Allegis Group, Inc. continues to expand, we are going to face a limitation on the availability
of space. We currently own a section of a one-floor office building with capacity of four
hundred employees. At this point in time, we have three hundred fifty employees occupying
the space. Due to the high demand for new employees from internal growth, we must consider
how to operate as we move forward. Our current plan is to hire fifty new employees by June
2016 and one hundred by year-end of 2016. In order to manage our continuing growth, I am
proposing that we initiate a telecommuting program, where some of our employees are
granted the opportunity to work from home.

Telecommuting has been a trend in the business world that has accompanied the rise of
technology. More companies are adopting a model in which employees are able to work
remotely, and research has proven its effectiveness. Remote workers, when properly managed,
are more productive than office workers (Andrew, 2015).

In order to initiate a telecommuting program, it would require us to purchase laptop computers

for new hires. Under our recent company-wide initiative encouraging teamwork, we have
started transiting employees to laptop computers, phasing out the traditional desktops
computers. This provides ease for eligible employees that seek to transfer out of the office into
a remote working position. For new hires however, we have an established relationship with
Lenovo, and through ordering laptops in bulk, we will be able to receive a deal that provides a
quality product that is also cost effective.

Alternatively, we have the option of expanding our current office space through the acquisition
of the vacant area of our current building. Another option would be to relocate employees and
fill vacancies in other offices throughout the country.

Allegis needs to take everything into consideration when planning, implementing, and
managing its future growth, including the space limitations presented as new employees are
hired. Criteria to focus on for deciding a plan are the cost, functionality, and alignment with the
long-term goals of the company.
Overcrowding in the Workplace 2

Research

Introduction

In an effort to not only maintain our continued growth, but also improve employee productivity
we have explored a telecommuting program. According to a study by Nicolas Bloom, a research
professor at Stanford University, in the U.S, remote work is more common for workers at the
lowest and highest ends of the pay scale. The chart below shows the distribution from Bloom’s
study (Peck, 2015).

U.S. Remote Workers

0.06
Share of Workers Primarily at Home

0.05

0.04

0.03

0.02

0.01

0
1 2 3 4 5 6 7 8 9 10
Wage Decile (Lowest to Highest)

Allegis Group would place emphasis on lower-paid workers in regards to new hires and
transferring employees to the new telecommuting program. There have been case studies done
at multiple companies exploring the benefits and drawbacks of telecommuting programs. The
studies have yielded similar results; as employees gain flexibility, there is increased productivity
as well as worker loyalty (Hronline Admin, 2014).

Case Study – Ctrip

A Chinese travel agency, Ctrip, conducted a study with its employees to identify how effective a
telecommuting program would be in their industry. The company had half of its employees
work from the office, and the other half of the employees work from their homes. The study
showed that “Ctrip almost got an extra workday a week out of them.” Not only were the
employees working longer hours, but they also took less time off. This is because they have
flexible schedules that allow employees to better manage their time and are more accountable
Overcrowding in the Workplace 3

with how they do so. Additionally, employees showed improved trust in the company and had a
higher retention rate. In the Ctrip study, employees that worked in the office were more likely
to quit compared to employees that worked from home (Peck, 2015).

Overall, Ctrip was able to benefit from the use of a telecommuting program. It was able to cut
costs and saved approximately $1,900 annually per remote worker through having employees
work remotely – not having to pay for office space and furniture. The program also has
employees with increased productivity, which allows it the opportunity to better serve its
customers. Customers have to maintain the priority for any business and a telecommuting
program aligns with this goal (Peck, 2015).
Overcrowding in the Workplace 4

Solution

Telecommuting Program

Preliminary Details
Through research there are obvious benefits to a telecommuting program and in order to
implement a plan within Allegis Group preliminary details must be defined. First, we have to
evaluate which positions and employees would be eligible for the program. In deciding this, we
have to look at what information each employee would be handling due to confidentiality, and
what their job function is. Next, we have to decide the necessities for remote workers. We have
to answer the questions what do remote workers need and how can we supply with them with
the tools to succeed (Altom, 2013). We had decided that our remote workers are going to need
laptops as well as a space at home that they are able to do work in. Finally, we are going to
prepare an operating budget for the program.

Budget
Allegis Group already has a pre-existing contract with Lenovo and ordering laptops through
them is required. Fortunately, Lenovo offers the best pricing in the industry while providing a
quality, long lasting product. We have requested a cost and price analysis from Lenovo, and
they gave us the following tiered pricing:

We will have to decide as a company what pricing option would best suit the needs of our
company. I would recommend purchasing 250 units, because it offers competitive pricing and
provides room for growth beyond the planned one hundred employees.
Overcrowding in the Workplace 5

Implementation
The Procurement Department and Human Resources Department can be in charge of the
implementation process. As the Procurement Department was previously in charge with the
contract with Lenovo, they would handle the purchasing of laptops and other new assets. The
Human Resources Department would redefine job roles and decided which employees are
eligible for remote positions.

Both departments can work together to formulate a timeline for the telecommuting program.
The timeline begins early 2016 and will take place from January through March. In January, a
hiring freeze will be initiated in order to prepare for the program. The departments will use this
month to outline remote worker protocols and establish reporting lines. In addition, the
Procurement Department is going to purchase the laptops through Lenovo. In February, upon a
timely arrival of the laptops, the Information Technology Department is going to program them
with the proper software and security features. Furthermore, two telecommuting employee
workshops can be held for employees that are transitioning from in office work to remote
working and another for managers who are going to manage a remote team.

The workshops would be used to combat the potential issues that can rise due to a
telecommuting program. One issue will be how to effectively communicate between
employees. Email and instant messaging are common ways to communicate, but may not
always be the greatest way to transmit information. One way to combat this is that if an email
thread becomes longer than three responses, pick up the phone and call the person. In
addition, using video calls and screen sharing technologies from services such as Skype and
Google Hangout allows information to be more effectively shared. Another issue will be
availability as remote workers have increased flexibility in how they can schedule their work
hours. In order to combat this, core hours will be implemented in which employees must be
reachable during these hours. It maintains the flexibility of remote work while giving employees
the ability to contact their team. In addition, there needs to be an expectation that employees
come into the office as projects require them to. In addition to coming into the office for
projects, there can be incentives to come into the office for social events such as outings to
local sporting events.

As employees become prepared to work remotely and managers become prepared to manage
remote teams, the program can now be implemented. We expect this to happen in March,
where eligible employees will begin working remotely and the hiring freeze will end and new
workers will begin the interview process.

Alternative 1 – Lease More Office Space

Leasing more space is an option, as our current office building has unoccupied space. In
purchasing the adjacent space, capacity for our office space would increase to six hundred
employees. Our current lease agreement has rental cost per month at $52,000. Through
acquiring a lease to the additional office space, it would add $17,000 to our lease, making the
total $87,000 per month. In addition to leasing the space, we would also have to purchase
office furniture (cubicles, tables, chairs, etc.) and that was estimated to cost $250,000. Allegis
Overcrowding in the Workplace 6

Group would have a fixed cost of $250,000 for the furniture, with a variable cost of $87,000 per
month (H. Dennehy, personal communication, November 30, 2015).

If this plan is selected, in 2016 the total cost for the expansion would raise our expenses from
$624,000 to $1,294,000. Leasing more space would allow Allegis Group to grow and maintain
its current model of functioning. However, once the space reaches capacity of six hundred
employees, we will once again face the issue with how to manage our growth.

Alternative 2 – Relocate Employees

Another option would be relocating employees into vacancies in already existing offices
regionally and nationally. This would cause a reallocation of company resources, as a new team
would have to be formed in order to handle the increased number of transfers around the
country. The new team would be created within the Human Resources Department using
existing employees. However it may create an overwhelming amount of work for these
employees as they are going to be stretched having to keep up with previous job
responsibilities as well as their new ones. The team would have to assist in finding vacancies in
offices, and if the offices are not in the region the team would help find the employee new
housing while selling their old house. The process cost averages $35,000 per employee and
once capacity is reached in our corporate office, it would be difficult to maintain this model.
With an expected one hundred new hires by year-end in 2016, the cost to relocate fifty of our
employees would reach approximately $1,750,000.
Overcrowding in the Workplace 7

Conclusion

In order to maintain our continued growth, I recommend that we implement the

telecommuting program. Remote workers have the lowest fixed cost while leasing more office
space has a high fixed cost and high variable cost per month. Redistributing employees would
not only be a bad use of time and resources, but it would also incur a huge variable cost to the
company. Overall, a telecommuting program is not only cost effective, but it also allows our
company to maintain its functionality. With management trained appropriately and employees
having a proper understanding of their responsibilities, a telecommuting program would
increase productivity and allow Allegis Group to further grow. Finally, the telecommuting
program aligns with our company’s long-term goals where teamwork remains at the forefront.
Our employees will be well equipped with all the tools to succeed as we move forward with
new technological practices.
Overcrowding in the Workplace 8

References

Altom, T. (2013). Being present at work doesn't have to mean being there. Indianapolis

Business Journal, 33(47), 23.

Andrew, M. (2015, August 20). Have you noticed, more of us are working from

home?. Investors Business Daily. p. 00.

Hronline Admin. (2014, November 17). The advantages & disadvantages of remote working.

Retrieved from http://www.hronline.co.uk/blog/advantages-disadvantages-remote-

working/

Iten, K. (2013, February 27). Overcrowding in the workplace: Two ways it impacts on your

employees' health and safety. Retrieved from http://fspbusiness.co.za/articles/risk-

assessment/overcrowding-in-the-workplace-two-ways-it-impacts-on-your-employees-

health-and-safety-1706.html

Peck, E. (2015, March 18). Proof that working from home is here to stay: Even Yahoo still does

it. Retrieved from http://www.huffingtonpost.com/2015/03/18/the-future-is-

happening-now-ok_n_6887998.html