Over the past few years, remote work has risen in popularity. Some companies are remote-friendly, allowing employees to work from home a few days a week. Others are remote-first organizations, encouraging team members to work from home, the beach, or anywhere they wish. By establishing remote work as the company default, remote-first organizations can attract talented employees, reduce costs, and improve profits.
While this may sound like a radical restructuring, allowing your team to work remotely has some serious perks. Outlined below are four reasons to consider becoming a remote-first organization.
1. A Virtually Unlimited Talent Pool
Remote-friendly organizations provide employees the flexibility to work from home. However, workers are still expected to spend a set amount of time in the office, which restricts hiring to a geographical location. In contrast, remote-first organizations are designed to be fully remote. This removes the constraints of working from a physical office space, giving companies the freedom to hire globally.
With access to an international talent pool, organizations can hire the best employee for the job rather than focusing on local candidates. However, hiring across borders does come with its challenges. To ease the hurdles of hiring abroad, companies typically must work with an employer or record or professional employer organization.
When considering the EOR vs. PEO decision, companies should determine whether they want to establish a business entity in the country where they’re hiring. Organizations that don’t want to operate as a business abroad should work with an EOR. EORs employ workers in other countries on a company’s behalf, taking on the burden of local legal requirements. Companies that wish to open an office in a foreign country can work with a PEO instead.
2. Improved Productivity
Running a highly productive organization is essential if you want to stay ahead of your competitors. Productivity refers to how efficiently and effectively your team completes tasks. Focused and motivated employees will finish tasks in a timely manner and produce high-quality projects. Unmotivated employees may struggle to finish basic tasks and produce sloppier work.
Many companies fear allowing employees to work from home will increase distractions and reduce productivity. But the opposite is proving true. One survey found that 68% of enterprises felt employee productivity improved since switching to remote work following COVID-19. So, what’s going on?
When employees are allowed to work remotely, they have the ability to create a work environment that reduces distractions. Instead of chatting with co-workers or struggling to concentrate because of background noise, team members can home in on their work. Remote work also removes the stress of a morning and evening commute. This allows employees to approach their work from a more relaxed state, improving focus.
3. Cost Savings
Running a business is expensive, and operating costs tend to increase as a company grows. This takes a massive chunk out of a business’s hard-earned revenue. Operating costs include everything you pay to run your company. This includes things like payroll, marketing, and rent. If your company’s operating costs are too high, it can reduce your overall profitability.
For many organizations, real estate costs are one of their highest expenses. Research estimates that the average annualized cost of an employee workstation reaches $18,000. For an office with 50 employees, that’s $900,000 per year.
One way companies can reduce operating costs is by switching to a remote-first model. This removes the need for an office building, saving you money on rent, utilities, and office supplies. However, since your remote team will need access to technology in order to work, many companies still send their staff a few key items. These may include laptops, keyboards, and headsets.
4. Higher Retention Rates
Does your company feel like a revolving door of new hires and departing employees? If you answered “yes,” you may have a serious issue on your hands. High turnover rates cost you more than just the headache of finding a new employee. They can also decrease team morale, reducing productivity. Additionally, it takes a significant amount of time to onboard and train a new hire. Investing time and money into an employee only for them to leave shortly afterward is a huge company expense.
Improving employee retention reduces the amount of time your HR team needs to spend recruiting and training talent. This lets your company shift its focus from finding workers to providing value to current employees. This shift can help reduce future turnover and improve employee satisfaction, resulting in more productive teams.
If your company is striving to improve retention rates, shifting to a remote-first model may help. Remote work eliminates the need for employees to commute to an office each day. It also allows workers to create a more flexible schedule that adapts to their lifestyle. This improves work-life balance, increasing employee satisfaction and decreasing the likelihood of a team member leaving.
The Future of Work Is Remote
Remote work is on the rise. The companies that take advantage of this new business structure will have happier, more productive employees, not to mention higher profit margins. Those who don’t risk getting left in the dust by their competition.