Sahil doesn't care for telecommuting. I, however, am a big fan of it under the right conditions. The right conditions being a project guideline and scope that allows developers to do the majority of their work with a minimum of interaction. Good examples of this are modular development (modules being fairly independent of eachother),or situations where an API/business layer is already implemented and they are simply building on top of it. (Here's the api, build me a UI)
The main downside of the telecommuter is that you don't get the human interaction that some projects require. An interesting paradigm has been making its way through some business circles though, the concept of rural-sourcing. In rural sourcing you outsource your development to developers in low cost areas. Take a typical senior developer in New York City versus the same developer in Omaha, Nebraska (beautiful city btw). For a basis of comparison we'll use salary.com programmer IV.
You'll find that in Omaha this position is worth a median of $80,722. In New York City this position has a median of $98,073. So you have about a $17,500 difference in just salary. Now toss in the higher taxes you pay in New York versus Nebraska, in addition to the various overhead of having a worker in an office (office space, office supplies, parking (particularily in NYC). You quickly begin to realize that you can save a pretty significant sum by moving the job off-site.
Some people have a problem with the whole "not being in the office" concept of a telecommuting worker. So let's head over to expedia and see what the cost of a flight from omaha to NYC is. For 4 days. You'll find the answer is around $300 (of course you could probably get a better rate if you did it frequently via negotiation, corp discount). So now we potentially have a situation where you bring your telecommuters in for that special face time once a month. Figure in an average hotel with internet, and a decent meal allowance... I'll pull a number out of my head, we'll say $600 considering a $100/night room and $50 per day for food. So it'll run you about $9,800 to bring a telecommuter in one week a month for a year. At this point we've saved at least $7,700 per worker in just salary. When you figure in the lower overhead costs it's even better.
Other potential savings?
Most telecommuters will supply their own computer. Chunk off another $1,000 - $2,000. Plus realize that the kind of machine someone buys on their own is usually of much better quality than the ones most companies "assign".
The median salary in salary.com is for an office worker. The majority of people I know would take a paycut if they were allowed to work from home on a regular basis. I know I would.
Many people leave their work in the office. If your work is in your home, you can have an epiphany after hours and sign in to be productive.
Now, this is all assuming you have telecommuters scattered to the four winds. The true concept of rural sourcing is setting up shop somewhere nice and inexpensive, generally in the midwest. You import developers to that area so they can meet to discuss things and then the flying concept only applies to the select few team leads who need to do so. That's where the big savings come in. I've encountered several companies that have their media and marketing arms in the big city where the action is and their IT arms are in low cost areas. Usually it is a win/win scenario as well because that salary goes a lot farther in Omaha than it does in NYC.
The question in the end is: Would you rather hire 15 expensive programmers in NYC who may or may not be the most skilled available or hire15 lower cost workers from anywhere in the country where the pool of candidates is huge and you can demand a higher quality than you can locally where your candidate pool is limited?
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