Remote Work: Millennial Pandering or a Smart Business Decision?

Remote Work: Millennial Pandering or a Smart Business Decision?

Companies love to complain about how they have to bend over backwards to meet the demands of millennials, who now represent the majority of the workforce.

Once such demand is flexibility in working location.

To the extreme, services have popped up that enable workers to literally travel the world while maintaining a job. For example, there is a company called Remote Year that organizes travel and accommodations for workers who want to live and work in 12 cities in 12 months.

Is Remote Work Too Extreme?

Have we gotten too soft in allowing this? Or is this a really good idea?

I consider myself a people-person, and one thing I enjoy most about work is having “work friends” that you can interact with on a daily basis. I’m also a firm believer in walking the hallways to get a sense of what’s really going on. On top of this, I have had success in growing revenues by merely re-locating complementary departments so they could more readily bump into each other and share innovative ideas.

But as I heard more and more about remote working agreements, I decided to do some research and even give it a try. There are massive benefits and also some downsides to working with a distributed team. I would urge all companies to keep an open mind, and discover how remote working can be a plus for their business—then think about how to manage the potential downsides.

Three Pros of a Digital Workforce

Given the advances in digital technology, remote working can be a boon to your business. Everything else is in the cloud, so why can’t my employees be there too? There are several benefits to a virtual team. The three largest ones in my experience are:

1. Access to Talent You Otherwise Could Not Afford

Having a solid infrastructure for remote workers allows you to hire people who would be too expensive to hire on a full-time basis. Many talented developers, designers, marketers, and consultants prefer juggling multiple balls and would not settle for a full-time gig at a single employer (unless the money was phenomenal).

Chief Digital Officers run between $250,000 and $750,00 per year these days. You might not be able to afford that, but you may be able to find a “fractional” executive for $75,000 who is available enough for your needs. Developers average a six-figure salary. Don’t have that in the budget or don’t need one full-time? You can find highly skilled computer engineers for a portion of that.

2. Fewer Distractions Lead to Higher Productivity

Cisco Systems, which has been allowing remote working since the 1990s, stated that it realized $195 million in annual productivity gains from its telecommuting program. No time wasted by the water cooler, no distractions from people walking by and asking, “Hey, do you have a second,” no unnecessary face time or meetings. Commuters don’t arrive burned out by the traffic. In fact, eliminating the commute frees up more time for your workers to, well, work!

3. Save on Real Estate Costs

The average yearly cost per employee to rent office space in a city ranges from $4,194 to $14,800, depending on where you are located. For companies looking to save on overhead, implementing a productive work from home strategy could really help. What percentage of your sales go directly to your landlord?

The Biggest Risks of a Digital Workforce

Of course, remote working is not perfect. There are some roadblocks you need to watch out for if you expect to have a distributed team.

Opportunity Cost of Lost Chance Encounters

I haven’t found any hard data to support this claim, but ask any executive, and he or she will tell you that there is power in just being together with your colleagues. That’s where crazy ideas — that turn into great ideas — form. These moments are much harder to create via chat, Skype, or email.

Security and Downtime Concerns

If you’re dealing with a lot of sensitive information, such as credit card information or patient health data, it may be difficult to stay compliant with data security protocols with a distributed network of computers. Chances are people don’t have to “swipe in” to their home office, so there is a greater chance hardware can be stolen. Furthermore, you won’t have an on-site IT guru to troubleshoot computer, software, or network issues, which could lead to downtime.

Shirking

People who sit at home and don’t actually do their job is a common concern for most leaders considering a distributed set-up. First, it’s worth noting: the data shows that slacking off actually decreases when you empower employees to work remotely. However, there are always going to be some bad apples, and you’ll need to make sure you have the right measurement and accountability devices in place to safeguard against this risk. Get your HR team involved in making the decision on when and who should be allowed to work remotely.

Is a Digital Workforce for Us?

Still deciding? Ask yourself these three questions to assess if a remote working experiment is appropriate for you.

1. Is Your Workforce’s Output Measurable?

If it is, you are a prime candidate for a digital workforce. Salespeople are clearly measurable (sales). Developers can be measured on time and accuracy (how often their code breaks). Creatives (writers, designers) can be evaluated based on meeting deadlines and consumer engagement with their work (number of views, number of click-throughs, etc.).

Measurement leads to a trackable sense of accountability on your team.

2. Do You Have a Strong, Widely-Engrained Culture?

Values speak louder than words. If your culture includes a shared set of values, you can feel more comfortable trusting all your employees to make the right decisions in the face of uncertainty.

I used to work at McKinsey, where there is a very strong culture. We were encouraged to be entrepreneurial in our decision-making, within the bounds of the firm’s values. “It’s better to ask for forgiveness than permission” was a common mantra. This only works if people understand the cultural ground rules.

3. Do You Have Growth Ideas, but Implementation Is Limited by a Constrained Budget?

What about starting a virtual “innovation arm” of your company? This digital department can be an incubator for new growth initiatives. You won’t need to pay for extra real estate, and you may get access to talented people who you can’t otherwise afford to hire. And it can be temporary. You can always create an in-person team once the new idea is proven.

In the end, allowing workers some locational flexibility should not be viewed as pandering to millennials. Instead, it should be a conscious business decision, based on your analysis of the above pros and cons.

How the Sterling Woods Group Can Help

You can use us as a digital workforce! Sterling Woods can help you come up with a viable strategy to grow your business, then staff a virtual team to get it going. We can stay involved running the initiatives for as long or as short as you’d like. Contact us for a free 30 minute diagnostic.

About the Author, Rob Ristagno

Rob Ristagno is the founder of The Sterling Woods Group and partners with companies to drive rapid digital revenue growth. The key is a successful digital membership program. Prior to creating Sterling Woods, Rob served as a senior executive for several niche media and e-commerce companies. Rob started his career as a consultant at McKinsey and holds degrees from the Harvard Business School and Dartmouth College. He has taught Product Strategy at Boston College.

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