🙋♂️ Accessing the best talent: Talent pool increases as you broaden your borders.
👯♂️ Diversity: A team that can come up with more diverse ideas.
🔧Culture: A different, oftentimes better, culture.
💎Work-life integration: Being able to better integrate your life into your work, and vice-versa.
💰Cost: Mainly perceived on the arbitrage on salaries.
The surest way to cut your costs and boost your margins is to break down geographical barriers and to hire a remote team. Here are five reasons why.
1. Remote work increases talent options
In the next few years, it’s going to be much harder to attract and retain the best talents for your workforce.
A 2016 Society for Human Resource Management (SHRM) study found that more than half (54%) of HR recruiters reported having to settle for second-rate talent when they insisted on in-site. The SHRM study cited a Mobile Work Exchange Report, where 88% of HR managers said workers quit because they wanted to work remote.
A 2018 CareerBuilder survey quoted roughly half of all the hiring managers surveyed (45%), who complained they were unable to find the talent for filling urgent positions. Eighty-six percent of their most qualified candidates were either already employed or not looking for jobs – while 40 % of their talented employees planned to leave in the coming year.
A 2018 Upwork report found that such specialized employees were not only harder to find than three years ago, but they were even rarer if you wanted to hire in-house.
The bottom line?
Why settle for expensive second-rate talent, when you can easily have your pick for a snip of the cost from any one (or more) of the 195 countries on earth? Remote work increases the size of your talent pool so that you can be sure you have the best workers, regardless of where they are.
2. Remote work improves diversity
Breaking down geographic barriers also gives you a more diverse team. And countless studies confirm that a mix of skin colors and backgrounds leads to business success.
Take this recent study from the Journal of Financial Management, for instance. Researchers, Mayer, Whao and Zhao checked the results of 3,000 publicly traded companies in 2001-2014 across nine measures of diversity that included ethnicity, gender and sexual orientations.
The conclusion of the study was solid – with higher diversity doubled their average (ROI) in any given year. Such companies also tended to be more resilient and glaringly more innovative.
A mix of backgrounds tended to give more original and objective perspectives as they helped with problem-solving. On top of that, a more diverse workforce tended to attract more diverse clients. Finally, such a workforce had a halo effect in that it attracted similarly skilled workers, who wanted to work for such enlightened companies.
Small wonder that last week’s Kalo 50 Best were Fortune 500 companies (like Google, Amazon
3. Remote work improves culture
The remote culture is very different from that of office-based companies. In many ways, too, its culture may be healthier and more robust than that of the onsite location.
It’s true that building a remote culture can be frustrating. After all, many managers want their companies to wear a consistently distinctive brand. With workers dispersed all over the globe, it’s hard to achieve that. But managers only find this problematic, when they define culture too narrowly. As futurist Dominic Price of Atlassian recommends, think of “culture” as multi-faceted, and your remote team excels.
That’s why authors Fried and Hansson of “Remote: Office not required” want companies to get out of this thinking “You don’t need everyone physically together to create a strong culture,” they wrote. “The best cultures derive from actions people actually take.”
In all cases, most experts agree the type of culture you outfit your remote team with depends on you. In an article for The Guardian, Cary Cooper, professor of organisational psychology and health at Lancaster University Management School, said that remote management takes a slightly different twitch than that of “regular” office management, though the skills are the same.
Employee engagement, good communication and organization are just some of the lubricants that makes your remote team work.
4. Remote work boosts productivity
Remote workers have the type of work-life integration that not only produces happier healthier workers but also makes workers more productive.
They can straddle PTAs; call friends; volunteer or jog the block. So, their work makes them more fulfilled and happy, since it balances their other life-areas and is freely chosen. They tend to work around the clock – definitely overtime, take few breaks, and value the labor.
Think that’s unique?
- A 2014 Harvard Business Review found 53% of remote workers are more likely to work overtime compared to 28% of on-site employees.
- A survey by the Society for Human Resource Management reported 83% of of U.S. companies that have implemented flexible work policies have seen an increase in employee productivity.
- Inc. noted 52% of remote employees say they are less likely to take time off, even when sick.
The most important opinion is that of the workers, however. A recent survey from software-producing giant, TinyPulse of 509 remote U.S. workers and more than 200,000 on-location workers showed that 91% say that they feel more productive working remotely.
Remote workers may have less contact with their co-workers, but they’re undeniably happier at work than their “regular” teammates, and that makes them more productive.
5. Remote work saves you money
Remote workers tend to cost you less than half of the price of less skilled workers from high cost of living places like San Francisco or New York.
As the following studies show, a remote team saves you money in many ways:
- British telecommunications company Vodafone reported that 61 percent of global respondents said their companies’ profits increased when they hired remote.
- A 2014 Harvard Business Review (HBR) found that employers who hired remote saved $1,900 over nine months for each worker. Further, people who hired remote saved $1,800 a year over sick days.
- A recent Stanford University study by Bloom and colleagues for the Quarterly Journal of Economics concluded that home workers reduced attrition rate by half. Similarly, Owl Labs and TINYpulse found that companies that support remote work have 25 percent lower employee turnover than companies that don’t. This saves a lot of money, since the cost of replacing highly-trained employees can easily exceed double their annual salary.
The savings are significant with remote work in many ways, from the cost of space to the salaries paid to the cost of replacing workers.
So why aren’t more business owners hiring remote?
The truth isn’t so simple and hiring situations are more complex than we’d like to think. You have different types of jobs. Remote workers work better for one kind for one kind of company than they do for another.
There’s a certain amount of skill and talent that comes into choosing your workers. Some companies simply prefer hiring locals whom they can supervise. It takes a different management style – as Cary Cooper in his Guardian article said – with not all bosses able to straddle remote management. Some people are better remote workers than others. Some other managers have problems defining work quality and even communicating with foreigners. These and other reasons make remote work challenging, if not unfeasible, for certain companies.
The bottom line
Remote management doesn’t always work out, nor can everyone fumble it. But when you can, remote teams tend to give superior results across the board.
The benefits of hiring remote are immense. With remote workers, you can:
- Persuade the pick of the world to labor their backs and brains off for you.
- Gain superior performance for minimal pay.
- Boost team health and happiness without top pay and perks.
- Reap more innovation and a stronger culture.
That’s how going remote can work for you.