SMEs investing more in flexible working practices than five years ago

SMEs across the West Midlands are investing more in flexible working practices than they did five years ago, despite the pressures of the economic downturn, new research has concluded.

The study by Lloyds Bank Commercial Banking shows that 20% of West Midlands SMEs that operate flexible working are now investing more to offer these opportunities, and a further 51% have managed to keep investment in flexible working unchanged, despite the economic downturn.

Just under a fifth (18%) said they now invest less than five years ago with a further 11% saying they do not know whether they have invested more or not.

The research reveals that 60% of West Midlands SMEs currently operate flexible working practices, compared with over two thirds of SMEs nationally (69%), with the most popular practices including:

•    Part-time/flexi-time working (76%)
•    Home working (62%t)
•    Training employees to carry out multiple roles (44%)
•    Allowing employees to work from multiple locations (also 44%)
•    Use of contractors and freelancers (36%)
•    Job sharing/secondments (24%)

Those SMEs that offer flexible working report a number of benefits – more than half (53%) cite improved staff morale; nearly two thirds (64%) mentioned being better able to meet customer demand; over a third (36%) report improved productivity levels; and just under a third (31%) mention improved staff retention as the main business benefits.  

When asked why they adopted flexible working practices in the first place:

•    Half (49%) of respondents said they felt that there would be benefits for both their business and employees
•    Less than a fifth (16%) said they did so to meet changing customer demand
•    More than one in ten (13%) felt doing so was a natural step to accommodate employees lifestyles
•    A similar amount (11%) said they were responding to employees requests
•    Only 4% wanted to empower employees to choose their working hours
•    The same quantity (4%) cited wanting to offer competitive employee benefits
•    Only 2% wanted to formalise informal arrangements that were already in place

Dave Atkinson, area director for Lloyds TSB Commercial Banking in the West Midlands, said: “Flexible working can play a crucial role in creating a more dynamic workforce and can bring huge business benefits. This research shows SMEs across the West Midlands are catching on to the rewards of flexible working and that more businesses than ever are investing to offer opportunities to their employees.”

A significant minority still do not offer flexible working practices.

Despite growing recognition of the benefits to be gained from flexible working, less than half (41%) of SMEs do not offer it in any form and they cite a number of reasons for not doing so including:

•    Over a third (35%) said that they do not employ enough staff to do so
•    Just over a quarter (26%) said that their staff had not raised it as an issue
•    Just 13% stated they do not have the necessary IT and support structure
•    Only 3% said the cost of implementing would be too high

“This research does demonstrate that a notable minority are still reluctant to adapt to changing employee and customer demand. However it is my experience that offering flexible practices translates into improved staff morale, better productivity and customer satisfaction,” added Mr Atkinson.