Why Employee Monitoring Software Hurts Your MSP Business

The World Health Organization declared Covid-19 a pandemic in March, 2020. That same month, demand for employee monitoring software exploded by 80% compared with the previous year’s monthly average.

Surveilling employees isn’t a new concept by any stretch. But with more than 40% of the American workforce suddenly working from home full time, a new sense of fear began to surge among business owners and managers.

Why? Because many still feel that people need to be ‘seen’ to ensure they’re working. Maybe you’re even one of them.

That increase in demand for employee monitoring software meant a lot of companies were exploring their options.

• Some genuinely liked what they saw in available tools.
• Others found the tools problematic and even a little creepy, but without better alternatives, made purchases anyways.
• Many more explored their options but backed away, legitimately concerned about what these tools would do to company culture and the trust they’d worked hard to build with their employees.

Scrolling through the answers to this question posted to the MSP subreddit in May 2020 provides a pretty good temperature reading of the MSP community’s general opinion of employee monitoring software at the time—or at least what the community members were willing to admit publicly. For example:

• “Nope I trust our team inherently”
• “Definitely not. In my opinion if I had employees that I felt needed to be monitored, they probably aren’t the right employee for us.”
• “The day my MSP is using employee monitoring software, is the day I no longer own it, or the day it dies. With the kind of work an MSP does, if you have so little trust in your employees that you need to go to those lengths, then why in the hell do they have access to your CLIENTS sensitive information?”

Regardless of whether you and your company are pro employee monitoring, vehemently against it, or still on the fence, there remain some visibility challenges that need to be solved when it comes to digital-first and remote work environments.

No one can really see what anyone else is doing, and we’re losing A LOT of time every day trying to solve that with pings, status updates and meeting after meeting.

What problem are you really trying to solve with employee monitoring software?

Sure. There are a handful of situations where implementing employee monitoring software may be the right answer.

For example, there are a few industries in which data loss prevention is a real concern and the ability to monitor what workers are doing is critical for security. And sensors, dash cameras and GPS tracking devices can bring heightened levels of safety and proactive maintenance control to transportation and fleet management industries.

But by and large, if you’re wanting to use monitoring software to catch your employees online-shopping or to scare them into being more productive, your plan is probably going to backfire.

Here’s why.

3 Reasons why employee monitoring software isn’t the right solution for your MSP

1. If employees really want to waste time, they’ll always find a way

Loads of managers still report having strong doubts that their remote workers perform as well as their office-based counterparts. This is despite a ton of surveys and research that suggest otherwise.

For example, more than 90% of employers say productivity has stayed the same or improved with employees working from home, according to a report from Mercer. And a recent study by the National Bureau of Research found the increase in work-from-home setups will actually boost productivity in the U.S. economy by 5% .

Productivity is obviously important for any team. We get it. But let’s be honest, employee monitoring doesn’t work away from a firewall.

It’s also worth noting that judging someone’s productivity based on their moment-to-moment computer activity can be a pretty flawed endeavor. It assumes that it’s time-put-in that’s the biggest indicator of productivity, when in fact, work output is far more meaningful to business success.

It could take your best employee half the time it takes another to do the same project. So if that best employee then wants to spend a little time ordering their groceries online because it puts them in a better headspace to tackle the rest of their day with gusto, who really cares? Let ‘em.

A quick note on productivity

The U.S. recently ranked 11th worldwide in terms of productivity, according to research by Expert Market. American employees produced an average of $36.94 in productivity per person per hour, based on 1,767 total hours worked in 2020.

So how does this compare with the stats of the country that topped that list?

Luxembourg came in first, with its average person producing $84.77 in productivity per hour based on 1,427 hours worked. So even though the average Luxembourger works 340 fewer hours per year than the average American, they’re more than twice as productive per person per hour.

Clearly time-put-in isn’t what’s truly important when it comes to work productivity.

2. You’re going to kill your culture with a lack of trust

Beyond micromanaging your remote MSP employees ' work days and placing importance on entirely the wrong productivity metric, monitoring your employees makes a pretty strong statement about the kind of culture your business supports.

So what happens when the trust is broken?

According to David Tomczak , MA—a PhD candidate who researches electronic performance monitoring, privacy and surveillance in the workplace—people have an unstated expectation that their employer should treat them with respect. It’s a psychological contract. And along with that, they expect their employer to trust them enough to do their job.

When this expectation gets tested with electronic performance monitoring (EPM), there can be a violation of that psychological contract.

“This might lead individuals to behave in a way that is actually contradictory to what EPM tries to do…What we find though is that as the level of monitoring increases, the likelihood that a person experiences that as a psychological contract violation increases and actually leads them to withhold effort from the organization.”

Far more important than avoiding a bit of withheld productivity though is retaining talented people.

“I've found that the dehumanization of work has been the biggest factor in creating unhappy and disengaged employees,” said Rasmus Hougaard, CEO and founder of Potential Project and co-author of the book “Compassionate Leadership: How to do Hard Things a Human Way” in an article for Fortune.

“It begins and ends with leadership driving a corporate culture that fails to recognize its workforce as people first, producers second.”

What if we just don’t tell them we’re watching?

Of course, some companies engage in monitoring without even telling their employees. No harm no foul, right?

While monitoring tools say their best practice is to encourage employers to be transparent about their monitoring activities, these tools can easily be installed silently. It’s ultimately up to admin users to decide because U.S. employees still don’t have a whole lot of rights when it comes to privacy. With the exception of some recent updates in California, privacy laws in the U.S. haven’t changed much since 1984, according to Tomczak.

But just because you can, it doesn’t mean you should.

3. Data from employee monitoring software is easily misinterpreted

Perhaps the most important reason why employee monitoring software won’t solve your team’s visibility and operational awareness problem is that data from these tools is often presented in opinionated ways and it’s far too easy to misinterpret.

For example, one popular tool on the market relies on admin users to make upfront decisions about what valuable work looks like for their team. More specifically, it presents a ratio of time employees spend on “unproductive apps and sites” versus “productive ones”.

So what’s the flaw here? It’s impossible for anyone to make that decision about anyone else’s tools and workflow with true accuracy.

For example:

• One of your MSPs service delivery managers might spend time every day finding better ways to service your clients using external knowledge sources like IT-related Facebook and LinkedIn groups or that MSP subreddit mentioned earlier.
• Another team member with the same job title could spend an hour a day on those same sites scrolling through posts and comments that have zero relevance to work.

But according to the data? These two people have spent their time in equally valuable (or invaluable) ways, depending on how it’s interpreted.

It’s also worth noting that just because someone ‘isn’t working’, it doesn’t mean they aren’t working.

But arguably some of the most innovative ideas are generated while people are doing anything but sitting in front of their computers.

Transparency and trust have to go both ways

Gathering data isn’t inherently problematic. On its own, data is simply factual and unopinionated.

It’s when we start to draw assumptions and opinions based on data from a single perspective that we run into problems—categorizing specific actions and activities as productive or unproductive, for example.

Instead of having an admin user or admin team evaluating employees from a place of power, we need to create open digital environments in which everyone shares and can learn from the data and each other. From a team’s manager to it’s most junior hire, each employee can transparently see what’s being shared—and be certain of what isn’t.

This kind of open digital work environment enables teams to ‘work out loud’ and have visibility into the real-time work progression of their teammates. It also creates opportunities for discussion around identified patterns and processes.

• We can see what everyone’s doing, so what’s really working to move the needle and what isn’t?
• Where are we wasting time and how can we collectively make changes to be more effective and successful?
• And how can we better understand what productive work actually looks like for different teams?

There’s a better way

For the companies that bought into the current monitoring options out there out of desperation, but really didn’t need to go that far. And for those that looked at those options and decided against them, but still need a solution to their operational awareness problem: there’s a better way.

Based on the studies and research that continue to pour out week after week, it seems pretty clear companies are getting the hours out of their remote and digital-first employees.

We know people are working. That isn’t the problem here.

But what companies may not be getting is the results they want.

We created Produce8 to add transparency and visibility to digital and remote teamwork , all while still respecting work cultures that value openness and trust. We believe in empowering teams to work collectively on identifying ways to improve productivity by reducing digital distractions and the work blockages that hold them back. And we see value in enabling teams to work together better than ever in asynchronous ways that support true work-life balance.

Monitoring your employees isn’t going to solve your problem. But creating a digital workspace that enables team members to collectively share accurate information about what their team’s doing and accomplishing in their MSP software and all their other apps in real-time will satisfy the valid need for awareness, without compromising company culture.