Report 2011-002-AEP - Management Advisory on the Potential for Real Estate Cost Savings Through Telework

Published by the Equal Employment Opportunity Commission, Office of Inspector General on 2011-09-30.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                              Washington, D.C. 20507

Office of
Inspector General

                                             September 30, 2011


TO:                 Jacqueline A. Berrien

FROM:               Milton A. Mayo, Jr.
                    Inspector General

SUBJECT:            Management Advisory on the Potential for Real Estate Cost
                    Savings Through Telework (OIG-2011-02-AEP)

The attached Management Advisory is a summary of our views on the current Agency
discussions of its strategic approach to achieve improved cost management through a telework
program designed to reduce real estate costs.

We are available to meet with you, or members of your staff, to discuss any aspect of this
advisory or any of our work relating to telework and cost savings. Please feel free to contact me
(ext. 4301), or Senior Evaluator Larkin Jennings (ext. 4391) at your convenience.

C: Claudia Withers, Chief Operating Officer
                                       Office of Inspector General

                                   MANAGEMENT ADVISORY
                     The Equal Employment Opportunity Commission’s (EEOC)
                      Potential for Real Estate Cost Savings Through Telework

Effective cost management is a highly desirable and achievable business (operational) goal.
With the EEOC facing major budget challenges, and in light of President Barack Obama’s goal
of saving $3 billion in federal government real estate costs by the year 2012, we believe
infrastructure (real estate) cost savings, and the more efficient use of Agency real estate,
represent compelling opportunities for the EEOC to achieve improved, more effective, cost
management. Based on the Office of Inspector General’s (OIG) previous studies and recent
discussions with EEOC leaders, we believe the EEOC is in an ideal position to use [frequent]
telework1 to achieve major infrastructure cost savings.

Our recent discussions with EEOC leadership revealed a renewed interest in the potential of
telework as, among other things, a key tactic in its overall strategy to reduce operational costs.
For example, in July 2011, the Office of Field Programs invited us to discuss our 2003 frequent
telework initiative2 with its Future Space Design workgroup. In addition, other headquarters
offices (Office of Chief Financial Officer, Office of Information Technology, and Office of
Federal Operations), recently voiced support for exploring the use of telework to achieve real
estate cost savings.

Earlier this month, the OIG met with the leadership of EEOC’s employee union, the National
Council of EEOC Locals, No. 216, AFGE/AFL-CIO, who expressed interest in having the OIG
consider reviewing our 2003 frequent telework initiative with the objective of updating the data
contained in our cost model. The OIG frequent telework cost model is the key component in
achieving significant real estate cost savings. The model, developed in conjunction with an OIG
contractor, the U.S. General Services Administration (GSA), and an expert panel, shows the
EEOC can achieve major savings by reducing office space no longer needed by teleworkers.
While the model’s cost data is out-of-date, the model’s assumptions remain relevant. Indeed, the
Department of Veterans Affairs (VA) used an adaptation of our cost model in identifying savings
in response to President Barack Obama’s call for federal agencies to cut real property-related
spending beginning in FY 2012.3

While we concur with the Union’s suggestion that our cost model should be updated, in our view,
the EEOC would be better served by conducting an update, as did the VA, rather than the OIG.
For example, the Agency gains first-hand knowledge of the opportunities, benefits, and risks of
using telework to reduce costs. EEOC will save time by eliminating the need to wait to review
and analyze the results of an OIG “refresh” of its cost-model since EEOC’s analysis can be
conducted concomitant with its updating of the cost model. A collateral benefit of this approach

  OIG defines frequent telework as telework scheduled to be performed a minimum of two or more days per week.
  Reducing Infrastructure Costs through Increased Use of Telework, Report Number 01-13-AMR, Increased Use of
Telework to Reduce Costs at Headquarters, OIG Report Number 03-15-AMR, Office Of Inspector General
Frequent Telework Pilot Program (Phases I and II) Report Number 06-07-AMR.
  Presidential Memorandum—Disposing of Unneeded Federal Real Estate, June 10, 2010, and OMB
Memorandum—M11-22, Realignment of Federal Real Estate, May 4, 2011.
is a reduction in the time required to launch a pilot program to test the model, and subsequently
implement a permanent program. In this connection, we believe the EEOC should consider
forming an Agency-wide task force to review our cost model, and assess the opportunities and
risks associated with its use in the current environment.

The task force should include a broad cross-section of those likely to participate in, or be directly
affected by, a robust telework program. This would likely include, but not be limited to, all
levels of agency management and leadership, union leadership, information technology and
telework experts, support staff, knowledge workers, financial analysts, etc. In addition, non-
agency members of the task force would be helpful, and might include representatives from the
GSA, Fair Employment Practice Agencies, and federal agencies and entities that have
successfully used frequent telework to achieve cost savings. The OIG will remain available to
assist in informing the task force’s review and analysis of the goals, composition, and character
of our cost model.

We would suggest that the project milestones not exceed 180 days from inception to completion,
to include task force research, analysis and reporting; pilot program development,
implementation and reporting; and final recommendations on the efficacy of telework by EEOC
as a means to reduce real estate costs and achieve more effective overall cost management.

We view the use of telework to reduce real estate costs as a long-term method to achieve
improved cost management. Indeed, initial measurable cost savings may not be realized for
several years following implementation. Thus, it is prudent to view the development,
implementation and management of a telework program designed to reduce real estate costs
through a strategic lense, and manage outcomes and expectations from a long-term fiscal