A Results-Only Work Environment (ROWE) is one in which the most important criteria for evaluating employee performance is the completion of satisfactory work on time. How or where an employee completes work is not important.
A ROWE does not provide employees with paid sick days, personal days or vacation days. Employees who work in this type of outcome-focused work environment are free to set their own hours and work from any location, as long their choices do not cause bottlenecks that hold up other people's work.
Advantages of working at a ROWE
The ROWE strategy is popular with startups, particularly those that are technology focused. This type of workplace environment has received renewed interest because of COVID-19 quarantines.
Advantages of working at a ROWE include:
- Better work-life balance.
- Shorter "commute" times.
- Ability to schedule work around appointments, illnesses and family responsibilities.
- Less stress.
- Focused productivity.
Disadvantages of working at a ROWE
Although employees who work in a ROWE are free to come and go as they please and work hours that suit them from any location, involuntary turnover (employees being fired) typically increases. This may be because putting the focus on meeting objectives allows managers to easily see which employees aren't pulling their weight.
Disadvantages of working at a ROWE include:
History of the ROWE
Former Best Buy managers Cali Ressler and Jody Thompson developed the ROWE paradigm at the company's headquarters in Minneapolis. Ressler and Thompson created the model to address problems they saw with the typical work environment that affected both productivity and employee satisfaction.
In 2013, however, Best Buy CEO Hubert Joly did away with the company's ROWE strategy. Joly felt the approach put too much emphasis on delegating work to employees and not enough emphasis on other leadership tasks such as coaching, motivating or directing employees.
Extending the concept of results-only to service contracts
The concept of "results-only" is increasingly being applied to IT service contracts in a delivery model that may or may not include outcome-based pricing (OBP). When the contractual mechanism for services is results-based, the price for a product or service is directly tied to a KPI, and the customer signs away their right to know when or where the work is being done.