Business has been moving towards remote working for years. Even before recent upheavals, remote work had been an option. In 2019, there were already more than 50 million Americans working away from the office at least once a week. The rate of adoption of remote working has been accelerated and now nearly 41 million Americans . . .
Business has been moving towards remote working for years. Even before recent upheavals, remote work had been an option.
In 2019, there were already more than 50 million Americans working away from the office at least once a week. The rate of adoption of remote working has been accelerated and now nearly 41 million Americans expect to work fully remote by 2026.
The draw for workers is clear to understand, but what’s the business case for remote working? In a globalized business landscape, starting as a remote-first or remote-only business has an appeal that’s hard to ignore.
Already, 13% of executives are ready to let go of the office for good, so we’re going to look at the reasons why remote work is the future for startups and corporations alike, paying attention to:
- Business costs
- Productivity and output
- Talent acquisition
- Staff retention
And also discuss some of the potential pitfalls
In a Gartner survey of CFOs before the pandemic, already 74% were considering moving at least 5% of their operations remotely. This type of change isn’t taken lightly; the ones in control of the purse strings know where costs come from and how to reduce them.
A whole host of cost savings can be realized when your workforce is fully remote, such as:
- Reduction in office space and associated costs such as utilities and security
- On-site technical maintenance – reimbursing for hardware and software can work out much cheaper
- Travel expense and mileage
Real estate is a big potential saving, with 87% of executives surveyed by PwC expecting to make changes to their real estate policy as they expand remote working post-pandemic. Of those, 61% expected that they’d consolidate office space in at least one city – the overhead reduction is clear.
On top of these costs that can be cut – or not be laid out in the first place if you go remote from the start – workers are more amenable to different salary structures. Over one-third of workers would take a pay cut of up to 5% in return for fully remote working.
Traditional managers have the perception that not having their team visible to directly supervise means they won’t complete their work. The need to have supervisory control over workers can actually be counterproductive.
Trusting a workforce to complete their tasks on their schedule and still complete deliverables increases their productivity, which directly impacts the bottom line. In fact, 77% of workers in a global survey said they were fully productive when working from home, a number that jumps to 85% in the Americas.
Within the same data, we’re told that 72% of people feel better able to deal with distractions and interruptions whilst 80% felt they could be more creative. In the same survey, 68% of respondents said they were “very successful” working at home.
This means that not only is productivity not compromised, but it’s also actually boosted by location-independent working.
Of course, productivity adds to your bottom line. It’s estimated that remote working can increase productivity by up to 21%, which can result in up to $1.4 million added to your revenue. Increasing engagement through remote working can have a strong, positive financial effect on your business.
A larger talent pool
In terms of your talent, working fully remote means that you can take advantage of skills on a global scale.
With no site visits and no commutes, you can get the best programmer for your needs in Ukraine, the top sales team in London, and a graphics designer in Bangkok. Language skills are rarely a barrier and you’ll have access to exactly what you need.
Working with freelancers also becomes a much more attractive, indeed logical step when you can hire globally. In fact, in an Upwork survey of hiring managers, 53% said they’re open to using freelancers and 71% plan to hire more in the next six months.
Remote working removes geographic confines and allows you to harness the skills and education available around the world.
Reduced staff turnover
Once you’ve found the ideal team from across the globe, maintaining remote working is a cost-effective way to keep them engaged. With the average cost of hiring a new team member over $4,100 and 42 days, keeping hold of good workers is invaluable.
Remote working is a power draw and a way to keep a team on side. In a Gallup poll, 54% of office workers said they’d leave their current job for another if flexible working patterns like remote working were on offer.
What’s more, highly engaged employers see absenteeism fall 41%, quality defects reduce by 40%, and that all-important 21% increase in productivity that we just looked at. When asked how happy they were in their jobs, 71% of remote workers said they were happy, compared to just 55% of office workers.
Having a team that appreciates their work and can get things done for job satisfaction can only have positive outcomes for a business. There are massive benefits in terms of HR, too, which make remote working the mode of the future.
The other side of remote working
Remote work is the clear direction of travel for many businesses, but it’s not without drawbacks. Concerns about fully-remote working include:
- A lack of company culture – embedding values and ideas across a team is tough when there are few regular touchpoints and offering rewards and recognition requires extra consideration when sending company swag across borders.
- Reliance on technology – your remote working tools need to be reliable and able to scale as your business grows with manageable costs.
- HIdden costs – as well as spending more on conferencing tools and collaboration platforms, bringing your core team together in the early stages when you want to establish relationships is a logistical and financial challenge.
The power of remote working for international businesses
The business case for remote working is abundantly clear yet a modicum of caution is needed. Lower costs, increased productivity, a wider range of talent, and a highly engaged team all hit the right notes in terms of a modern business environment.
For any business, local or global, high-tech or traditional manufacturing, remote work can be a viable option. Startups especially need to be considering the remote-first or remote-only model to be able to achieve their growth potential.
Being able to leverage the benefits of a global workforce and offer a method of working that’s both appealing to the workers and cost-effective for business will set long-term foundations for success.