Teleworking and workplace flexibility: a study of impact on firm performance

Purpose – The purpose of this article is to explore the relationship between teleworking adoption, workplace flexibility, and firm performance. Design/methodology/approach – Empirical survey of a representative sample of 479 small‐ and medium‐sized firms. Data gathered through interviews with company managers using a structured questionnaire. A t‐test used to analyse the mean differences of flexibility dimensions between companies, and a regression analysis used to study the impact of teleworking and other flexible workplace practices on firm performance. Findings – Firm performance is positively related to the use of teleworking, flexitime, contingent work and spatial decentralisation. Teleworking firms use more flexitime, have more employees involved in job design and planning, are more intensively managed by results, and use more variable compensation. The relationship of teleworking and external workplace flexibility is not so conclusive. Measures of external flexibility like subcontracting or contingent work are not associated with teleworking but spatial decentralisation is positively associated. Research limitations/implications – A limitation of this research is the measurement of flexibility at the firm level and the use of cross‐sectional data. To the extent that organisations may obtain functional and numerical flexibility by means of their relations to other organisations in networks, the most appropriate unit of analysis may be the network which it has implications for future longitudinal studies. Practical implications – Flexibility is a source of competitive advantage. Enhancing flexibility may be costly in the short run, but it gets easier over time. Firms become more flexible because their managers emphasise the importance of flexibility and because they practice being flexible. A self‐reinforcing process then begins. The relationships between the different forms of flexibility are important to understand the interaction between the dynamic control capacity of management and the responsiveness of the organisation. Originality/value – The article analyses the relationship between teleworking adoption and other flexibility dimensions.