In a recent TCS column, Glenn Reynolds inveighed against workplace policies by which employers limit employee web-surfing, block instant messaging, and so on:
"Sell your stock in companies with policies like this one. The management is obviously stupid, and the only employees likely to stay, long-term, in the face of this kind of a policy are those who can't get a job someplace else, someplace where the management is brighter than a bag of hammers."
I wonder whether Professor Reynolds' self-interest as a blogger might have lead him astray this time. As former Delaware Chancellor William Allen aptly noted, albeit in a rather different context, "human nature may incline even one acting in subjective good faith to rationalize as right that which is merely personally beneficial."
Indeed, as one of his fellow bloggers, I share Professor Reynolds' frustration with such policies. An unscientific review of my referral logs suggests that a substantial percentage of my site traffic comes from corporate and government organizations, from which it seems reasonable to infer that most of my readers are visiting the blog during working hours from their office computers. As more employers block employees from web-surfing, our readership likely will decline, reducing the pecuniary and psychic benefits of blogging. Yet, what is in Reynolds' and my self-interest as bloggers may not be in the best interest of employers and the economy as a whole.
Professor Reynolds makes three basic claims:
- The continuing development of technologies offering pervasive web access renders such policies unenforceable.
- Web-blocking policies are bad corporate policy: "the more intrusive the policies seem, the harder it will be to attract bright, creative employees who are marketable elsewhere: Just the kind of people that companies ought to want to hire and to keep."
- Instead of focusing on inputs, such as how employees spend their time, managers can and should focus on measuring productivity: "measuring the work done, rather than just whether employees manage to look busy, is going to be the management trend of the future."
The first may well be right, but the second is debatable, and the third is almost certainly wrong.
To be sure, the kids who work at places like Google probably would rebel if their Web access were restricted. I suspect it's precisely that sort of folks whom Reynolds has in mind. Yet, not everybody is -- or wants to be -- a Googler.
In my scholarship on employment and corporate workplaces, I've spent a lot of time reading the academic literature on the purportedly evolving nature of work and employee personalities. Based on that experience, I've concluded that there must be some sort of projection bias at work, because academics routinely overstate the extent to which creativity matters. In fact, however, as I've documented elsewhere, lots of economically vital jobs remain dull with little demand for individual creativity and lots of workers are perfectly happy in such jobs.
In arguing that web blocking policies are bad corporate policy, moreover, Professor Reynolds overlooks the costs associated with broad employee web access:
- Exposing the corporate network to viruses and spyware
- Use of corporate resources by employees running a side business out of the office
- Waste of bandwidth
- Display of inappropriate images on computer screens could expose the firm to liability for sexual or racial harassment, as can offensive emails and chat
- Lost productivity: US business employers supposedly lost half-a-billion dollars on the single day in 1999 when Congress posted the Starr Report on the web. By some estimates, over 13 million employees read the Starr Report during working hours on office computers.
Reynolds is probably right that a blanket prohibition of Internet access is unwise. Establishing and enforcing acceptable use policies, however, probably is a very good idea. After all, by one estimate, employee use of the Internet for personal purposes costs "American corporations more than $178 billion annually in lost productivity."
As for Reynolds' claim that managers can and should focus on monitoring outputs rather than inputs, most students of corporate organization likely would disagree. Measuring outputs was easy when most employers worked manufacturing jobs on an assembly line. If one worker slacked off, the cause of the backup could be spotted readily, as famously illustrated in the classic "I Love Lucy" episode in which Lucy and Ethel fought a losing battle with the assembly line at the candy factory.
Much modern work takes place in teams, which are often more-or-less self-directed. Such teams create a severe monitoring problem: Even if the team's joint productivity can be measured on an output basis, it is likely to be difficult to measure the contributions of each individual to the total. Economists Armen Alchian and Harold Demsetz offered the classic example of two workers who jointly lift heavy boxes into a truck. The marginal productivity of each worker is very difficult to measure and their joint output cannot be easily separated into individual components. In such situations, obtaining output-based information about a team member's productivity and appropriately rewarding each team member are very difficult and costly. The problem is even worse in modern service jobs, where team productivity is essentially non-separable.
Given the nearly intractable monitoring problems inherent in the modern workplace, it is hardly surprising that many employers resort to prophylactic rules, such as banning Web surfing. Indeed, even in the academy, where both Professor Reynolds and I make our living, a growing number of schools are adopting restrictions on Web-surfing in class room settings, for many of the same reasons that firms are doing so in the workplace. Hence, I suspect it is not "measuring the work done," but rather devising workable and cost-effective acceptable use policies that will be "the management trend of the future."
Stephen Bainbridge writes a weekly column for TCS and teaches law at UCLA.