For many people the biggest win of working from home must be the absence of a commute. No more time lost in traffic queues. You arrive at your desk fresh and ready to attack the day's big issues, not the driver of the 18-wheeler who cut you off on the freeway. That works for both the employee and the employer, of course, as an unstressed worker has more concentration and energy and so is more productive. It also transforms the commute time itself into productive time for the company.
Calm concentration is another important aspect of home working.
Any home office must be sufficiently distinct to meet this basic emotional need. Being perched on a stool in the kitchen looks cute in furniture catalogs, but it is not going to last long in practice. If you're considering letting a staffer work from home you need to assure yourself that they will succeed there. The first step is helping them set up their workspace. Somewhere they can go when they get up in the morning, and with a door which they can close when they're done.