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An Intriguing Development for Workplace Concierge Services

March 23, 2008
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Related Topics: Work/Life Balance, Featured Article, Compensation, Benefits
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The concierge benefit that Millennium Pharmaceuticals provides to employees rescued Tracy Simpson several years ago, when her husband’s birthday was rapidly approaching. She called the company’s concierge service, Circles, and the Boston-based company swung into gear, searching nationwide for a signed copy of To Kill a Mockingbird for Simpson’s spouse, a writer. Circles provided a menu of birthday options ranging from the out-of-reach (a $29,000 first edition) to a more modest—but collectible—35th anniversary edition ($250) from a rare book shop in Portland.

   That’s what Simpson chose, and the signed book was sent directly from the store. Simpson’s spouse was thrilled and so was Simpson, the biopharmaceutical company’s associate director of human resources. More recently, Circles planned the couple’s first kids-free getaway to celebrate their 10th wedding anniversary.

   Simpson says that the concierge service, in short, is a boon for recruitment and ongoing retention at Millennium, which is based in Cambridge, Massachusetts. "It offers our employees a way to simplify their lives."

   It’s a great story about a company reducing work/life stresses. But do such anecdotes constitute primarily hype, or an intriguing harbinger of tomorrow’s workplace? Just 5 percent of employers offered concierge services in 2007, up from 2 percent in 2003, according to the Society for Human Resource Management’s annual benefits survey.

   Concierge enthusiasts argue that such programs—ranging from errand services to an on-site concierge—are gaining traction and will follow the trajectory of employee assistance programs. Instead of being perceived as a luxury perk, the argument goes, concierge support will increasingly become a workplace prerequisite, particularly when courting younger—and frequently more work/life sensitive—employees.

   One intriguing sign of a possible future for concierge services is that in late 2007, food and facilities management giant Sodexho announced the acquisition of Circles, making the Boston-based company’s concierge services available to Sodexho’s roughly 3,000 U.S. corporate client sites.

   Still, some questions do persist, beginning with quantifying return on investment. If concierge companies wrap holiday gifts for employees or help service their cars, does that really boost on-the-job productivity? Moreover, how do employers justify such an investment in a cooling economy?

   Circles chief executive Kathy Sherbrooke, who has weathered previous economic speed bumps since co-founding the company in 1997, says a financial case can be made, both in the near and long term. "When your workforce gets lean, you need your workforce to do more," she says. "You need them focused when they are at work. You need them present and not absent."

   As for the longer-term horizon, Sherbrooke is quick to categorize employers who cut concierge during the dot-com bust as "fly-by-night" companies. "It’s the companies that are really committed to making their employees’ lives work who will be strongest in the end," she says.

Work/life juggling
    The hunger among employees for better work/life balance is nearly ubiquitous, Sherbrooke says. More employees are telecommuting, she point outs, not because they prefer working in isolation, but rather to recoup personal time by shedding travel time to work. Middle managers, who could once lean on administrative assistants, have found that crutch less available as support services are trimmed back.

   Employees estimate that they spend an average of three hours each week handling personal tasks at work, according to a 2007 survey by OfficeTeam, a Menlo Park, California-based staffing service. A 2006 survey conducted by ComPsych, the employee assistance program provider, also highlighted the strain of juggling work and personal lives: 22 percent of employees described it as their primary source of stress.

   "People are stressed and overworked," says Cathy Leibow, vice president of Leverage Life, a national concierge and work/life company based in Pleasanton, California. "How many people drive into work and think about the five other non-work items that they have to do that day?"

   Frayed employees also can undercut their own effectiveness, a point reinforced by research published last year in the Journal of Occupational and Environmental Medicine. In the study, "Fatigue in the U.S. Workforce: Prevalence and Implications for Lost Productive Work Time," researchers determined that fatigued employees averaged 5.6 hours each week in lost productive time, compared with 3.3 hours among workers who weren’t tired.

   Employers already have taken some steps to invest in more on-site services, according to an annual Hewitt Associates survey of benefits for salaried employees. In 2007, 70 percent of companies offered some type of on-site personal service—from an ATM to dry cleaning to mail services—compared with 65 percent in 2005. "With our clients, there definitely is a trend toward trying to enhance the workplace," says Carol Sladek, a principal and leader of work/life consulting at Hewitt.

   Even so, when companies tighten their belts, leaders are more likely to demonstrate their commitment to work/life balance with initiatives that don’t require cash on the table, such as flexible scheduling or telecommuting options, rather than investing in programs like concierge services, says Ellen Galinsky, president of the Families and Work Institute, a nonprofit research center in New York.

Measuring the ROI
    If employers do make the investment, the two primary payoffs are likely boosted productivity and loyalty, concierge advocates say. According to a 2007 survey conducted by Leverage Life, 68 percent of employees said that concierge support made them more productive at work.

   At Millennium Pharmaceuticals, employees surveyed after using the Circles service reported saving an average of 2.7 hours each time. Still, that time savings wasn’t necessarily all on the job, a point that emerges in interviews with some concierge users.

   Keisha McDonald, a registered nurse and nurse manager for Memorial Regional Hospital in Hollywood, Florida, used a concierge company to get her presents wrapped during the holidays last year. After dropping off the gifts with a concierge rep near the front of the hospital, McDonald could proceed along to another busy shift.

   The perk didn’t save work time, but did eke out some downtime at home. "When I have more time to relax and do the things I enjoy, when I come back to work I’m refreshed and rejuvenated," she says.

   McDonald’s employer, Memorial Healthcare System, signed a nearly $400,000 annual contract with Chicago-based Errand Solutions in 2007 to provide concierge services for the system’s 10,600 employees. Besides gift-wrapping, Errand Solutions assists employees with a myriad of other tasks, including dry cleaning and car washing and detailing.

   Making a case for increased work productivity "might be a stretch," since it’s difficult to measure whether that particular task would have been done on the job, says Ray Kendrick, the hospital system’s chief human resources officer. But Kendrick is more than happy to spread the word about the hospital system’s quality-of-life perk in order to promote recruitment and retention in the hotly competitive South Florida labor market.

   He adds: "We are big believers that whatever we do to help the employees translates to helping the patients."

Shopping for a concierge
   Sherbrooke says employers shouldn’t be quick to dismiss the value of recaptured employee time, even if some of it is technically off the clock. Circles’ surveys show that employees save two to three hours on average each time they use the service. Those are vital hours that the employee can spend with the children, working out, or actually snagging a good night’s sleep. All that energy can be pumped back into the job, Sherbrooke says.

   Across a large company, the time savings can quickly accumulate. If a company with 10,000 employees has a usage rate of 40 percent—Sherbrooke says the rate varies, depending upon how aggressively the service is marketed—that’s 4,000 requests in a given year. Multiple 4,000 by 2.5 hours, Sherbrooke’s estimate of time saved, and that’s 10,000 hours saved annually.

   By early 2008, Sodoexho officials had just begun to market the Circles offerings to its corporate clients. A Sodexho spokeswoman declined to specify how many clients had signed up, saying it doesn’t share that kind of data with the public.

   But the concierge support option, the company says, would build on Sodexho’s array of facilities management services, which includes custodial, mail room and reception services, among others. In recent years, corporate clients have been asking for quality-of-life tools to better support their time-pressed employees, says Ronni Schorr, Sodexho’s vice president of brand management.

   Not all concierge services are structured the same way. Some programs labeled concierge services are closer to a telephone-based errand service than a more traditional concierge, which allows face-to-face interactions, says Sara-ann Kasner, founder of the National Concierge Association, based in Minneapolis.

   Kasner recommends that corporate leaders perform due diligence to better understand the concierge provider’s breadth and depth. What types of services would be offered? Does the concierge service specialize in particular areas, such as travel? Is it possible to interact with someone in person or are all the requests handled over the phone or through a Web site?

   Concierge providers also can frequently tailor the menu of services they offer, along with the cost involved. At Millennium Pharmaceuticals, the company’s 1,000 employees don’t pay to tap Circles’ research services, such as to plan a trip or locate a special gift, Simpson says. If they want an errand run, however, a fee would be charged, she says.

   At Memorial Healthcare, employees pay for the retail cost of the service itself, such as the dry cleaning costs, but not the concierge assistance involved. McDonald, the nurse manager, was eager to try out the car servicing option. It would be a productive workday indeed, she says, if she could pick up her spiffed-up car outside the hospital door and return home with sufficient time to regroup and recharge for the next day.

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