Virtual working - A reality today

One glance at the list of Fortune 500 companies today shows one common trait: All of them are multinational companies, meaning companies located in different geographical locations. The need for any company to go multinational was driven by business objectives like higher revenue generation, potential for creating an overseas customer base, and hiring the best talent available worldwide.

As businesses began to expand, so did the operation cost of maintaining multiple offices. One of the key challenges facing any growing company today is on how to reduce the business cost and increase the profit margins. Virtual working (or remote working) is a reality today for many companies, as it helps them reduce operating costs and at the same time, not compromise on employee satisfaction. It’s a win-win deal for both the company and employees, who benefit from an improved work-life balance.

So what are the factors, which are making virtual working a reality today and for tomorrow?

• The demise of the 9-5 schedule: With companies demanding employee commitment beyond the 9-5 fixed schedule, employees became accustomed and comfortable with the use of technology including mobile phones, laptops, and conference calls outside of the office premises. As employees are in constant connect with their work, flexible work timings became the norm. Hence, when the same employees are asked to work virtually, it is not an impossible change or adjustment, compared to an employee used to a strict 9-5 schedule.
• Costly and time-consuming recruitment process: Any HR person would agree that the cost of retaining an employee is lower than recruiting one. According to Talent Puzzle, the average number of days required to bring aboard a new recruit is 54 days. For any business, this translates to missed business opportunities, extra work load on existing team players, and the cost and probability of repeating the recruitment procedure (in case the new recruit does not join the company). Additionally, the company has a limited pool of talent to choose from, when the recruitment is bound to a geography location. On the other hand, for remote companies (in the case of Customer.io), the company reportedly had a larger (and better) pool of talent to choose from when they went remote. Virtual working helps companies to tap into a larger pool of extremely talented people, which in turn, would make the recruitment process much shorter.
• Technology: Virtual working would not be a reality today without the Internet and advanced collaboration tools. In the Information age, rapid advancements in the way we store and share information (using version control storage systems and knowledge sharing tools) and communication tools (like Google Hangout, Skype, and WebEx) have definitely enabled virtual working. Advancements in the cloud computing technology will reducing hardware costs for information companies, and also benefit virtual workers.
• Employee cost: On an average, allocating a desk space to an employee along with the transportation expenses can cost an employer $2000 to $5000 annually. These costs can be saved for a virtual employee. With increasing office rents and cost of living in major cities, employees working from a remote location save more money because of lower cost of living and have more time for their families and interests because of zero travelling.

So, with virtual working becoming a reality, does it mean that there won’t be any offices in the future? Not likely. Companies will probably shift to smaller offices, with a majority of employees working from home. It is equally likely that smaller companies with less than 20 employees, may opt for complete virtual working.