This is a simple sample cost-benefit analysis for home-based telecommuters
as seen from the employer's point of view.
[For an analysis of telework center-based telecommuting click
here] The example shows the main factors that should be considered if you
are a manager analyzing the potential of teleworking for your business—or
if you are a teleworker hoping to convince management to allow you to telework from
home.
If you wish to try this analysis using your own data click here.
SAMPLE COST-BENEFIT ANALYSIS FOR HOME-BASED TELECOMMUTING | (At end of first year of telecommuting) | ||
---|---|---|---|
Copyright © 1993-2008 by JALA International, Inc. All rights reserved. Use or reproduction of this file is free for non-commercial purposes. | Assumptions: | Average annual salary: | $40,000 |
Telecommuting days/week: | 1.5 | ||
COSTS TO EMPLOYER per TELECOMMUTER | |||
DIRECT COSTS | ONE-TIME | RECURRING (Annual) | NOTES |
Selection and Training | $175 | Both telecommuters & supervisors trained | |
Telecommunications | |||
—New Installations | $460 | Phone line and modem | |
—Services | $960 | Will vary, depending on need for telecommunications, local tariff structure | |
Computers | $500 | $75 | Cost of docking station, extra monitor, laptop instead of desktop computer |
Moving Costs | |||
Computer Equipment | $0 | Usually zero if employee handles this | |
Renovation/Installation | $0 | Some employee-specific materials, lock boxes, etc. | |
Facilities Leasing | $0 | Assumes employee reports to principal office on non-telecommute days | |
Furniture Purchase/Lease | $900 | $0 | |
Insurance | $70 | Annual equipment liability | |
Equipment Purchase/Rental Costs | $300 | $0 | Inkjet printer |
Performance Evaluation | $700 | Will vary, depending on level of detail required | |
TOTAL DIRECT COSTS | $3,035 | $1,105 | |
BENEFITS TO EMPLOYER per TELECOMMUTER | |||
DIRECT BENEFITS | |||
Increased Employee Effectiveness | $6,000 | Average 15% relative to non-telecommuters @ 1.5 days/week | |
Decreased Sick Leave | $348 | 2 days per year reduction; 230 work days per year | |
Increased Organizational Effectiveness | $800 | Average about 2% | |
Decreased Turnover Rate | $2,000 | Equivalent to 5% of salary in search and training costs avoided | |
Reduced Parking Req'mts | $360 | 30% reduction in $100/month space requirements for non-carpooler | |
Office Space Savings | $3,240 | 150 square feet @ $6/month per square foot proportionally reclaimed | |
TOTAL DIRECT BENEFITS | $0 | $12,748 | |
INDIRECT BENEFITS | |||
Decreased Air Pollution | Put your own number here for compliance with Air Quality regulations | ||
Increased Competitiveness | Put your own number here for the effect of your new productivity | ||
TOTAL INDIRECT BENEFITS | |||
ANNUAL NET BENEFITS | $11,643 | Per telecommuter with these characteristics | |
FIRST YEAR NET BENEFITS | $2,786 |
Try this analysis with your own data.
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Last modified:
Monday September 26, 2011.