Is remote working just another fad or really good for your business?

(originally published in 2019)

As the holiday season approaches, employers are preparing to Work at home requests from employees who wish to be at home with their families for Christmas.

The holiday season is causing a more noticeable peak, but the overall trend of remote working has increased in recent years. Since 2007 there has been a 159% increase in remote working in the US and by 2020 it is estimated that 50% of the UK workforce will be working remotely.

In the UK, more than 1.54 million people worked from home for their main job in 2019, up from just 884,000 in 2009, according to the ONS Labor Force Survey, the largest study of conditions of employment in the UK.

The Best Place to Work institute recently released its annual report on the world’s best workplaces 2019. Close examination of top-ranked companies reveals that 60% of them are actively implementing remote work policies in their organization.

60% of the top 20 companies listed in the annual list of the best workplaces in the world have an active remote work policy

Great Place to Work® Annual Reports

Following a talent shortage and employee interest, emerging technology is the second biggest driver of remote work in the workplace. Could the increase in digitization lead to a feeling of uselessness in office presence among employees? Is the demand for remote work driving innovation in collaboration technology?

The rise of productivity tools and people analytics platforms like Microsoft Teams and Workplace Analytics, Slack and Isaak from StatusToday promise to make managing remote teams easier and more transparent.

From Salesforce to Hilton, we take a look at the world’s best workplaces and establish the top benefits of remote working for employees and organizations while debunking popular myths.

Companies can access an ever-expanding talent pool

Due to the convenience and ease of hiring, employers often end up filling vacancies within their city limits. This excludes thousands of qualified remote applicants who would otherwise be a good fit for the job. Sometimes the most qualified and hardworking candidate for the job is someone who is homebound due to family responsibilities or visa restrictions.

American Express embraced remote working with the belief that expanding its talent pool globally is what has helped it provide better service and become a better brand.

Access to talent has become a major bottleneck for the progress of high growth companies. Remote workers have the potential to reduce this inconvenience.

Increased flexibility increases retention

One of the most underestimated costs that all businesses endure is employee turnover. Companies currently spend about one-fifth of an employee’s annual salary to find a suitable replacement. With remote working being one of the benefits most sought after by employees of all ages, the case for improving these policies to reduce turnover costs is quite strong.

Despite the benefit of retention, remote working is not as commonly practiced by employers around the world. For companies like Cisco or Vodafone, which have taken the gradual step of adopting these policies, an increase in retention combined with a visible reinforcement of the employer brand is evident through a quick glance at their ratings and reviews of employees. employees.

Remote work increases productivity

Contrary to popular belief, home workers are no more vulnerable to distractions than their office counterparts. It’s actually the office that houses the disruption caused by coworkers, random arrivals, noisy coworkers, etc. A recent article on poor management practices, shared that the average worker loses 20% of their daily activity due to interruptions and noise in the office.

A 2-year case study by Stanford Professor Nicholas Bloom with Ctrip (China’s largest travel agency) shows how effective working from home is. Ctrip noticed a 14% increase in productivity and an increase in hours actually worked among the remote study group. With these impressive results, Ctrip has implemented remote work policies throughout the company.

Operational costs and absenteeism decrease to increase profits

A geographically diverse workforce comes with a geographically diverse salary. When you hire virtually, you are no longer tied by the average salary in your area. For example, thanks to a lower cost of living, the standard salary of a software engineer in Warsaw will be considerably lower than that of an engineer in London.

In addition to the immediate cost savings resulting from maintaining a larger office space, remote working also benefits from increased revenue generated by increased productivity. All the collective hours lost with sick leave, late departures and distractions at the office add up to a surprising drop in the company’s revenue. In Nicholas Bloom’s 2-year study, companies reported an annual increase of $ 2,000 in profits per employee working remotely.

BONUS: Working remotely is really good for the planet

Remote work has an immediate impact on transport congestion in major metropolitan cities like London, New York or San Francisco. With congestion costs costing cities like London up to £ 9.5 billion, it’s no surprise that more and more cities are offering programs and grants to encourage remote working. The city of Tulsa is offering $ 10,000 in cash and reduced rent to all eligible workers leaving traditional offices.

Gallery: Emerging CEOs Make 7 Bold Predictions for the Work Life of the Future

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While these benefits present a strong case for companies to embrace remote working, there are still other practical aspects to consider. A remote working policy must be adapted, supplemented by technological authorization. Businesses need smart communication tools and productivity analytics to ensure employees stay efficient. Replacing traditional emails, modern communication platforms are ideal for brainstorming sessions and questions that require quick answers. Workplace and People Analysis tools provide additional workforce insight to help manage staff well-being and collaboration trends.

Nicholas Bloom’s case study, while well controlled and extensive, could be biased by the culture of his city, which in this case is Shanghai. Would the same result be produced if the study took place in Paris?

Remote working is the future, but it faces significant challenges in the present. In recent years, several large companies like IBM, Best Buy, and Yahoo have banned working from home altogether while others are under active consideration.

Let’s dive deeper into the issues facing modern remote workers in the next article.

(Thanks to Dylan Fernando for his help with the content and research of this article)

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