Staying in Line, Online

When retail giant K mart rolled out Internet access to more than 1,000 of its employees two years ago, company officials had high hopes that the global computer network would become just “like any other business tool,” said Dennis Wigent, the company’s director of internal communications.

Instead, the very person in charge of maintaining K mart’s Web site quietly created a link between the company’s official home page and a pornographic Web site. That employee was subsequently fired.

K mart was ahead of the curve--it already had in place rules that governed employee usage of the Internet. But officials at the Troy, Mich.-based company learned the hard way that employee access to the World Wide Web must be closely managed if it is to be used effectively.

While the nation struggles to find a way to shield children from indecent and obscene material on the Internet without trampling on free speech, corporate America is pushing ahead with Internet policies that in many cases dramatically restrict employees’ access to major portions of the global computer network.

Without question, the Internet has solidified its place in companies, large and small. Two-thirds of U.S. businesses--roughly 3.5 million--provide Internet access at work, according to a survey conducted this year by the American Management Assn., a professional organization based in New York. Among Fortune 1,000 companies, the proportion jumps to 98%, according to a separate poll by Gordon & Glickson, a Chicago law firm that specializes in information technology.

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About one-third of those companies have established formal policies regulating online behavior and hundreds more are scrambling to join their ranks.

Even Congress joined the bandwagon when it attempted to create a national Internet policy to prevent children from accessing pornography. The broadly worded Communications Decency Act sought to make it illegal to transmit indecent material over the Net. But the Supreme Court struck it down in June on the grounds that it violated the free speech rights of adults.

The popularity of the Internet as a business tool stems from its ability to send documents and electronic mail messages cheaply and quickly. Web pages provide an abundance of company information--including corporate filings with the Securities and Exchange Commission and details of competitors’ products--as well as a platform for buying and selling goods ranging from cars to personal finance software to hot sauce.

Because companies often own their computer systems, they may impose broad restrictions on how workers can use the Internet on the job--just as they do with phones, fax machines and other office equipment.

So when employers perceive a potential for wired workers to become a drag on productivity--after all, who can resist checking sports scores during playoff season or tracking stock prices during a market rally--they often rush to draft a broad, overly restrictive policy.

But these attempts to control productivity can come at the expense of worker morale. Such was the case at Sikorsky Aircraft in Stratford, Conn., where officials believed workers were spending too much time at The Dilbert Zone (https://www.dilbert.com), a wildly popular Web site based on the boss-bashing comic strip. Sikorsky officials used special software to block access to the site. But after a couple of months, the company responded to worker protests by reevaluating and changing its policy.

“The company came to the conclusion that it was, in fact, not a bad idea at all to have humor in the workplace,” said Bill Tuttle, a Sikorsky spokesman.

Sikorsky isn’t the only company to deal with this issue. Dilbert creator Scott Adams said he regularly receives e-mail from frustrated fans whose employers have declared the site off-limits.

But productivity isn’t necessarily a company’s foremost concern. Liability becomes an issue if employees use the World Wide Web to find pornographic and obscene pictures, potentially creating a hostile work environment.

Off-color and offensive e-mail messages and Web sites have figured into several recent high-profile employment cases against blue-chip firms. Key evidence in a racial discrimination suit against the Chicago printing firm R.R. Donnelley & Sons included 165 e-mail messages containing racial, ethnic and sexual jokes. Morgan Stanley and Citibank are defending racism charges involving e-mail evidence, and Chevron’s Information Technology Co. settled a sexual-harassment case for $2.2 million in 1995 after an e-mail message discussing “why beer is better than women” made the rounds on the company’s computer system.

Since its unfortunate episode, K mart has bolstered its policy, which states that access must be limited to business-related tasks.

“We have restricted access for most people,” Wigent said. Filtering software prevents employees from visiting World Wide Web sites “that sell something and ones with nudity. We ask people to take precautions against computer viruses.”

And for good measure, “we ask people to use correct grammar and capitalization since they are a reflection of the company,” he said.

The first wave of business Internet policies shows that their success depends greatly on whether the policymakers understand how employees use the Internet and the underlying technology that makes cyberspace work. Few firms think to create an Internet policy when they give their employees Web access, and a new genre of consultants is springing into the void to help companies with the task.

Arthur Andersen is one of several consulting firms that has added Internet policy analysis to its menu of services. Members of the firm’s Computer Risk Management practice lay out the risks that come with providing Internet access.

Among the Fortune 1,000, one in six companies has already had a “negative experience” with the Internet, according to the Gordon & Glickson survey. Such incidents include an employee downloading an off-color or offensive joke from a Web site and circulating it via e-mail; a worker visiting a chat room and unwittingly revealing a company’s competitive secret; and a Web surfer picking up a computer virus and importing it into the company’s system.

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When a policy falls short of its intent, in most cases it is because the authors--often human resource professionals or company lawyers interested in creating a shield against lawsuits--have only a vague understanding of how the Internet works and how it is commonly used, said Stuart Smith, a Gordon & Glickson partner.

For example, some policies forbid any personal use of the Internet--a restriction akin to banning personal phone calls at work. One company that sought the help of Arthur Andersen had written a policy so restrictive that it “negated all the benefits so you couldn’t even use the Internet,” said Mark Estep, senior manager at Arthur Andersen. For example, the policy prohibited the sending or receiving of computer files--an act at the very heart of Web use.

For many companies, Internet policies simply apply to cyberspace the same code of conduct that is applicable in the rest of the workplace. One section of Wells Fargo Bank’s Electronic Systems Use and Access Policy, for example, says: “Using company electronic media in a way which violates bank policy is prohibited.”

But such a policy is only as effective as a company’s efforts to enforce it. “Enforcement is almost ridiculous unless you want to hire someone to be the Stasi,” the infamous East German secret police, said Nathan Ainspan, who studies privacy in the workplace at Cornell University’s School for Industrial Labor Relations.

Although policies are rarely--if ever--written to encourage use of the Internet, companies whose lifeblood is the World Wide Web are among the least likely to have developed a formal policy. At Yahoo, the Santa Clara firm that maintains a popular and massive directory of Web sites, managers have declined to place limits on the 180 employees whose mandate is to surf the Web in search of interesting new sites.

“It’s hard to categorize whether someone is doing it just for the pure fun of it or if it’s something they have to look into or get feedback from for their job,” said Shannon Lemus, a human resources assistant for Yahoo.

Companies that make filtering software that caters to parents and schools report that sales to businesses have been booming in recent months. For Log-On Data Corp. of Anaheim, one out of every three sales of X-Stop software is to a company, said Michael Bradshaw, Log-On’s chief executive. Corporate customers now account for 20% of sales of CyberSitter, a program initially created for parents by Santa Barbara-based Solid Oak Software, said Vice President of Marketing Marc Kanter.

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Filtering software works by restricting access to Web sites that contain off-limits keywords (such as “Playboy” or “sex”) or by identifying thousands of specific sites by their Web addresses and making them inaccessible. Software designed for kids can be adapted into a product suitable for workplaces by adding new categories of restricted sites that cover the broad topics of sports, entertainment and leisure. Some programs can restrict access except during the lunch hour and at the end of the official workday.

Waverly Deutsch, director of computing strategies at Forrester Research in Cambridge, Mass., said companies can increase productivity by allowing broad access to Web sites, even if workers use it for such diversionary tasks as looking up sports scores.

Sixty percent of employers in a recent Forrester survey said access to the Web boosted worker productivity, compared with only 6% who complained that employees spent too much time playing computer games and sending e-mail to friends. In a separate study, to be released this week by the Society for Human Resource Management in Arlington, Va., companies reported that more than three-quarters of World Wide Web use in their firms is business-related. In this study, 48% of the 757 companies in the survey said the Web has boosted productivity, and 6% said it had the opposite effect.

“You have to ask yourself how that person would have gotten that information if they had not used the Net,” Deutsch said. “They would have leafed through the newspaper, perhaps stopping to read other articles along the way. Or they would get up from their desk and ask people if they caught the game last night.”