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Cover Story: Information Technology Annual Report

It doesn't matter much that Mia Daniel, a sales manager for American Express Co. who lives in West Palm Beach, Fla., rarely sees her supervisor or spends little meaningful face-time in the office--she's still in the loop. She even gets a daily cheerleading missive from her boss via AmEx's private network to her laptop, wherever she is working. "Let's end this

year with a massive finish," reads one. "THINK BIG. THINK GIGANTIC. THINK HUMONGOUS. THINK ABSOLUTELY ASTRONOMICAL. DON'T STOP AT NOTHIN'."

Most of all, don't stop at headquarters. Daniel and the entire 240-member core sales staff at American Express Travel Related Services Co. are telecommuters, members of the labor force who have chosen to, or have been told to, work anywhere, anytime --as long as it's not in the office.

With groupware, digital phone lines, and wide-ranging cellular networks, wherever these workers are can be a node on the corporate computer network. Market researcher Link Resources says the 8.4 million telecommuters out there today represent the fastest-growing portion of the work-at-home set. It expects the number to exceed 13 million by 1998.

The push to telecommute has gained momentum through federal incentives to reduce air pollution, corporate efforts to cut office space, and the need to hire key talent. Take Northern Telecom Ltd.'s Tennessee-based service operation: It wanted to hire William G. Holtz last year as vice-president for global enterprise services, but the former Unisys Corp. executive refused to leave Philadelphia. Northern Tel got him anyway, and Holtz now supervises a staff of 1,000, including his Nashville-based secretary, from his home in Philly. "There's nothing I can do in an office that I can't do at home," says Holtz. "And you eliminate the cost of having an office just to drive to and sit in."

DESK SET. Companies' efforts to cut costs have led to some interesting experiments. Ernst & Young has implemented "hoteling," in which up to 10 people share a single desk in a fully equipped office on an as-needed basis. Employees must reserve in advance. Over the past three years, the accounting firm has slashed its office space requirements by about 2 million square feet, saving roughly $25 million a year.

But the mobile concept of work does not come easily to all. For now, it's mostly salespeople and other travel-intensive staffers who are moving out of the office, on the theory that they weren't around much to begin with. Many companies still like to keep an eye on the troops. "This isn't the same workforce we had even 20 years ago," says Joel Kugelmass, author of Telecommuting: A Manager's Guide to Flexible Work Arrangements. "But we're managing the same way we did 100 years ago."

New technology could help. Affordable desktop videoconferencing means that more home-office workers can beam in as needed. Vivo Software Inc. just launched TeleWork-5, a $1,495 software-based package that lets telecommuters use video, share documents, and surf the Internet. In April, AT&T, Intel, and Lotus teamed up to develop new videoconferencing products that exploit AT&T's WorldWorx Network Services, Intel's ProShare videoconferencing system, and Lotus' Notes software. "The last bastion of defense for reluctant managers is `How can I supervise them if I can't see them?"' says Jack M. Nilles, president of JALA International, a Los Angeles consulting firm. With videoconferencing, he says, "that goes away."

FANCY PHONES. Local phone companies are also waking up to a huge market in the making. All seven Baby Bells are rolling out integrated services digital network (ISDN), speedy phone lines that can carry voice, video, and data simultaneously. ISDN had been hampered by spotty availability, installation headaches, and high prices, but the Bells started improving their offerings last year. ISDN is now available in about 80% of the country, at fast-dropping prices--Pacific Bell offers it for as little as $23 a month.

But fancy phone lines will not a telecommuter make. Many of the companies that allow telecommuting on an ad hoc basis provide home workers with out-of-date laptops and slow modems. David Goodtree, an analyst with consulting group Forrester Research, contends that companies need to turbocharge the home office with speedier equipment. The cost of outfitting a telecommuter with the right gear is about $4,500 for the initial setup and $2,150 in annual upkeep. The corporate infrastructure also needs a makeover, with modern remote-access computer servers and toll-free phone support to use when at-home setups have problems. With all the pieces in place, more companies can then follow the lead of American Express and THINK HUMONGOUS.By Edward C. Baig in New York


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