Across the workforce as a whole, there has been a big increase in the proportion of people having access to flexible working arrangements that allow employees to choose when or where they work. Such arrangements are recognised as contributing significantly to helping individuals achieve a better work/life balance.

But how do small firms perform in this area? Small and medium-sized firms - those with fewer than 250 employees -employ over 8m people and represent a significant element of the UK wealth-creating sector. So the way in which they run their businesses is important, not only to the economy but also to the wellbeing of a third of the UK workforce.

Some employers find it hard to see how they can offer flexible working to staff without putting at risk delivery of production or service targets, or causing resentment among other employees.

In order to provide practical guidance to companies that are interested in moving forward in this area, the Chartered Institute of Personnel and Development (CIPD) joined forces with the British Chambers of Commerce (BCC) to explore how small companies are adopting flexible working practices and dealing with the practical issues this throws up (the Flexible working: Good business report can be found at www.cipd.co.uk [1], under ‘subjects', ‘HR practice' and ‘flexible working').

The findings showed a clear business case for flexible working. The companies interviewed employed between six and 280 employees. Their conviction that flexible working was a key driver of service and profitability levels was striking. Where companies provided opportunities for flexible working, it was good for recruitment and retention and helped build an engaged workforce, which translated into improved profitability.

The report showed convincingly that small firms can be very good at giving their staff greater flexibility in their working arrangements. Without the bureaucracy and management layers that can afflict larger organisations, small businesses can provide excellent examples of working practices that deliver benefits to employees, customers and their own profitability.

The legislation giving employees the right to request flexible working has now been extended from parents of young children to people caring for adults, and is likely to be further extended to cover parents of teenaged children. This means that employers are required to consider such requests in order to comply with the regulations. But the evidence suggests that most employers are equally happy to consider requests from other groups.

Business case
However, the small firms whose experience was reflected in this report were responding not to the legislation but to the business case for flexibility. Where flexible working arrangements work best, they provide an opportunity to help meet the needs of the organisation, the individual concerned and firm's customers.

In addition to the impact on a company's bottom line, flexibility can help reduce the stress that many employees feel when they try to balance the demands of home and working life. Firms can also benefit from the positive impact of flexible working on their reputation as a responsible employer.

The companies that were included in the research admitted to facing challenges in implementing flexible working. These issues included:

• Balancing customer and employee demands
• Treating all employees fairly, for example where some are doing jobs that can be done from home but others are not
• Ensuring employees are aware of the company's policy on flexible working, and being willing to accommodate the needs of customers or colleagues
• Ensuring remote or home workers receive all communications and feel like - and are seen by other employees as - part of the team
• Providing the necessary training to enable staff to do a wider range of jobs

But none of the companies believed that these challenges were too difficult to manage. The answers often lie in good communications: in listening to people's concerns and explaining the situation.

Where issues arise, small companies tackle them in the same way they tackle other business problems: by facing up to them and talking them through with all the individuals concerned. In some cases, employees are expected to sort out problems in discussion with colleagues or team members.

Flexible working does not mean that employers simply stand back and leave employees to do as they like. In every company studied there was a clear determination by the chief executive or manager to stay in control and ensure that business needs were being met. Where services need to be provided to customers at specified times, a significant amount of planning may be needed to ensure that this happens. But the payoff is in improved employee satisfaction and levels of service.

Positive publicity
Flexible working can be seen as an integral part of good people management practice. It can also have a positive effect on business reputation. Several companies in our research were keen to demonstrate their commitment to being a good employer, for example by meeting the Investors in People standard or becoming one of The Sunday Times "100 best companies to work for".
Some common themes emerged from the research:

• Flexibility works both ways: organisations and employees both have obligations. Individual members of staff may need to cover for others, sometimes at short notice. The needs of the business and the customer or client come first
• Flexibility and work/life balance are not ends in themselves but means of achieving business outcomes. Many small firms need no convincing that happy staff means happy customers
• Flexible working in small companies is visible primarily in the way in which people are managed, rather than in formal employment contracts or company policies
• Flexible working practices are easier to introduce when companies share a common culture and values
• Flexibility is a business issue. There is no need to have an HR department or bureaucratic procedures in place to make it work effectively

The key message from the companies studied for others contemplating adopting more flexible working arrangements is not to fear flexible working. On the contrary, it could bring real and lasting benefits to your staff, customers and ultimately to your business itself.

Mike Emmott is employee relations adviser at the Chartered Institute of Personnel and Development