Virtual Employment – Part 3

So far we have covered the impact of remote employment engagements as they relate to business continuity and recovery planning (BCRP) and the implications of allowing for flexible working arrangements from home to off-set absenteeism as it relates to sickness/health issues.

In this third installment of The Virtual Edge I’d like to discuss the cost savings opportunities from an infrastructure perspective as well as a true green initiative.

There are as many reasons to review these categories of possible scenarios for virtual/remote work as with the others; yet there is some real tangible impact as we look at cost savings.

  • Virtual allows for reduced square footage, utilities, and infrastructure requirements than an average office setting.  Not only will the employees enjoy the benefits of working from home but, depending on your policies, they will also have more money in their pockets. Employees can:

charge back phone and internet usage to the company which may offset their current monthly plans (these plans as part of a home or consumer package are usually more robust and faster than business accounts at a much lower monthly rate)

write off part of their square footage, utilities and other services as it relates to the pro rata share of the household on their taxes (depending on State and Federal qualifications – they should seek the advice of a qualified tax expert to be sure)

  • save on gas or other transportation costs when there is limited need to travel to the office or the clients locations
  • save on dry cleaning for those in a business/formal dress setting
  • save on meals as they eat at home instead of out regularly
  • have more time in the day that was associated with the commute giving them free time for themselves or their families

As a green initiative Company’s will see an absolute savings in:

  • Reduced carbon emissions from their workforce traveling in cars and other mass transit vehicles
  • Reduced carbon emissions from the square footage it consumes to heat/cool and run a facility or office
  • In relocation costs and the waste associated with moving (boxes, packing materials, additional garbage)

There is a wider appeal, based on generational lines that green initiatives also support when attracting and retaining a workforce:

  • Increase your brand as a destination employer
  • Gen X, boomers and traditionalists see a broad impact on the environment for their children and grandchildren
  • Appeal to Gen Y as a green company
    • A 2009 recent study that stated:
      • 81% of gen Y feel it is important to work for a green company; 79% would accept a job offer over other non-green companies
  • What is required to review your ability to offer such employment opportunities? You do need to review part 1 and 2 of this series as well as a review of the final entry in a few weeks to have a full picture; but here are a few things to consider:
  • What travel will be required to the company facilities, training and clients? While viewed as a cost it is self-funding with the savings items mentioned above if managed correctly.
  • What level of productivity increase will eclipse some reimbursement when “the water cooler” is quiet? Employees working from home tend to engage in far less chat as those in a formal office setting and studies have found them to be more productive
  • Is there a pocket of talent somewhere in the world that would be ideal for you? Are they currently in the core workforce (7 -15 years experience) and unable to relocate due to kids in school, aging parents, roots to the community etc? Could the work be serviced by them remotely?
  • Can a remote office be opened close to a density of new hires? If not, then home based?
  • In our current economic climate professional rental space is at all time lows.  Negotiate a strong lease with renewal options based on your needs.  If this is not available within a major metro-area for your current locations then look outside major cities for reduced rent and infrastructure support.  Many State and Federal programs are available for tax credits and reduced utilities based on where you hire people or situate an office.  These remote offices can self-fund for years to come.
  • No need for relocation costs and COLA adjustments as you hire within the communities (or homes) where talent is based.
  • Expanding your reach to markets/clients where you previously could not set up an office or where you spend a large amount of travel costs.

There are risks with any proposition such as this and you’ll need to assess your company’s appetite and contingencies, as well as consider its culture, before beginning. Some of these risks are:

  • Loss of talent due to lack of connection or inclusion with the wider operations
  • Reduced productivity if the employee is not screened well for the ability to work remotely; not everyone can work from home productively
  • Expanded help desk requirements
  • Asset deployment, maintenance and recovery
  • Information systems vulnerability

However all of these are easily over come and are a part of the value add equation to make a decision to offer remote/virtual employment.

One large hurdle that we will explore in depth later in this series, and is now probably a key argument in your mind as you have read these 3 installments is … trust.  Can I trust my employees to be productive and do what they are supposed to be doing? Since they are not outside my door I cannot monitor what is happening.  Again, keep the skepticism alive and tell us your concerns.  We will address them as this series continues.

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