Have Laptop and Cellular Phone, Will Travel : Workplace: Companies are eliminating space and arming employees with portable technology that can turn anywhere from a car seat to a hotel lobby into a virtual office.

When he packed his personal effects in a box and took the photographs of his wife and two young sons from the desk, Ken Feldman looked like another casualty of corporate America’s job-slashing austerity.

He wasn’t. The marketing specialist at International Business Machines Corp. was trading his office for a laptop computer, cellular phone and control over his work schedule.

Feldman is one of 800 IBM employees merged from five locations in New Jersey and New York into a Spartan facility in suburban Cranford, N.J., a remade warehouse with generic desks. The idea is that marketing and service employees come in only when necessary, a pit stop for IBM’s road warriors.

“We wanted our employees to spend more time with clients,” says Duke Mitchell, general manager for IBM in New Jersey.

Companies across America are riding the latest trend in employee management: eliminating office space and arming workers with portable technology that can turn anywhere from a car seat to a hotel lobby into a virtual office.

“It’s a whole new way of working and thinking,” says Michael Bell, director of corporate real estate for Dun & Bradstreet Corp. “We’re seeing the office change from a place to come to work to a place to convene.”

The research firm Link Resources Corp. says about 41 million Americans, or 33% of employed adults, work from home, up from 27 million, or 22%, in 1989. Most, however, are independent contractors, free-lancers and entrepreneurs who work from home by choice.

Now it is company executives who are seeing the benefits and initiating or encouraging the move away from traditional offices. Link says the number of so-called “telecommuters” was 7.6 million last year, 15% higher than the previous year.

Among those signing up are units of IBM, Ernst & Young, Arthur Andersen & Co., American Telephone & Telegraph Corp., General Electric Co. and Hewlett-Packard Co.

Pioneers in the field report an improvement in employee productivity of between 15% and 20% and a savings in real estate costs of between 25% and 40%, Bell says.

In a time of corporate cost-cutting and emphasis on productivity and global competitiveness, that’s hard to ignore.

In addition, employees gain flexibility and more control over their work and lives. Information workers, writers and consultants can gain uninterrupted peace and quiet to do their best. Sales and marketing employees are freed to spend more time with clients.

Still, there are worrisome drawbacks.

Employees forced to leave offices often feel evicted and homeless. Others worry about their career status and miss the informal networking around the office water cooler.

The demise of the traditional office poses vaguer but potentially more troublesome questions about the gray area evolving between work and home life. When does working at home become an invasion of privacy? How do employers guard against employee hooky-playing? How do employees guard against overwork?

Denise Rousseau, a professor of organizational behavior at Northwestern University’s J. L. Kellogg Graduate School of Management, said the notion underlying these questions is that “work takes place in no place in particular but any place.”

Despite the cautionary notes, the acceptability of working anywhere has accelerated among employers. One reason is the law.

The Clean Air Act of 1990 requires companies with more than 100 employees in 10 polluted areas to reduce solo driving among their employees. Telecommuters count as people who don’t drive to work.

Nature also has played a role. Just in the past months, for example, the earthquake in Los Angeles and the harsh winter storms on the East Coast have forced companies to provide employees with laptops and other technology to avoid long, hazardous commutes.

Furthermore, many companies are realizing telecommuting allows them to hire the best talent regardless of location, says Abhijeet Rane, a research analyst at Link.

Finally, the technology and cost barriers that once made telecommuting prohibitive are disappearing, with the advent of accessible wireless and portable technology, Rane says.

Smaller companies such as Verifone, which sells technology that authorizes credit card purchases, and the advertising agency Chiat-Day, which created the Energizer bunny, were among the first to implement telecommuting.

Now larger companies are following.

IBM equipped its marketing and service staff with laptops and cellular phones and in late February opened its New Jersey facility, a renovated warehouse with no partitions.

When workers want office space, they walk into a kiosk near the entrance, punch in a number and a computer assigns them a desk, where their phone calls and computer files are automatically switched.

Feldman, 43, a 20-year IBM veteran, says he had mixed feelings when asked to vacate his desk in January.

“I felt displaced. I had to pack up everything into boxes. The only other time you have to do that is when you are laid off or fired,” Feldman says.

But with an office established at home and more time in the morning with his young sons and wife, Feldman says he is acclimating. The challenges now are mostly in learning the new technology, he says.

Ernst & Young’s northeastern operations moved from traditional offices to the “hoteling” concept in July last year, with flexibility built into its newly developed New York City facility for about 250 employees.

Staff members, equipped with cellular phones and laptops, call a “concierge” to reserve office or conference space. Only partners have private offices. Other employees share.

The objective, says David Tierno, managing director of the company’s Northeast Management Consulting Group, is a paperless environment, with files, data and memos all handled electronically.

Most of the company’s 50,000 to 60,000 employees worldwide are heading in the same direction, Tierno says.

Although some businesses are taking the initiative toward telecommuting, more often it is the employees who are pushing the issue.

At Nynex, hundreds of the 70,000 employees work from home one or two days a week under a flexible work arrangements program introduced in 1990, says Mary Maher, a staff director at the large regional telephone company.

“We were responding to the changing needs of the employee,” Maher says.

Many Nynex telecommuters have working spouses or are single parents and need the flexibility, she says. The company expects to triple use of the plan at significant savings over the next few years.

At AT&T;, one out of nine managers from a total U.S. pool of about 100,000 works from home regularly, says spokesman Burke Stinson.

Other companies see telecommuting as a contingency measure.

Nynex, which provides the special services required by a telecommuter, has seen customer interest pick up over the last months, prompted partly by the earthquake and the East Coast storms, says Georgene Horton, another Nynex staffing director.

“Companies are starting to realize they need contingency plans so they don’t lose productivity,” Horton says.

In California, Pacific Bell established a telecommuting hot line right after the earthquake and received thousands of inquiries, says Carol Nolan, the company’s telecommuting manager.

Sensing an opportunity, Pacific Bell offered free installation of services such as telephone lines, voice mail, call forwarding and digital phone lines that allow computer users to send data back and forth at higher speeds.

“We see it as a chance to educate people,” says Lou Saviano, a spokesman for Pacific Bell. “We want companies to see that there are other ways of getting work done than putting a body in a car and moving it down the highway.”