Managing flexible work arrangements: Teleworking and output controls

Flexible work arrangements present managers with challenges regarding how to manage employees using these arrangements. To date, little research has investigated how managers address these challenges. We investigate the relationship between the use of a specific implementation of flexible work (teleworking) and control system design, specifically the emphasis on output controls. Teleworking reduces the feasibility of monitoring employee behaviour as a control mechanism. Control theory suggests that this might be compensated by placing more emphasis on output controls. We conduct a survey (N = 897) among employees of a financial services institution, of whom 69% is allowed to telework. We find that among teleworking employees, the share of teleworking hours is positively related to the emphasis on output controls. However, employees who are allowed to telework report less emphasis on output controls by their manager relative to those not allowed to telework. We pose various directions for future research, which may help in explaining these findings.