While it’s true that the pandemic necessitated many businesses to adopt a work-from-home strategy, companies have slowly been transitioning to an online model as far back as 2014.
If you remember, former Yahoo CEO Marissa Meyer made a groundbreaking shift to telecommuting in 2013. She started slow – transitioning only 10% of the workforce from office to home-based and generated admirable results.
After one year, Meyer pulled the plug on the telecommuting project because she felt that at a certain point, telecommuting generated diminishing returns.
In our opinion, Meyer pulled the plug too early. There’s a learning curve in everything new. Had she stayed the course, Yahoo, which had been heavily losing financially under Meyer, might have turned around.
The studies that we share with you in this article proves that adopting a work-from-home strategy for your strategy will produce dividends.
1. Increase Productivity
A study by Global Workplace Analytics cites the following statistics to support the idea that a work from home strategy increases productivity:
- Many big corporations including Dow Chemicals and British Telecom have reported that employee productivity increased between 35% to 40% after they adopted a work from home/telecommuting strategy in the workplace.
- Likewise, more than 67% of companies that took part in the study reported that employees who transitioned to telecommuting assignments showed improved productivity.
- Other corporations such as Compaq, American Express, and JD Express reported that employee productivity increased from 15% to 45%.
It’s easy to understand how working from home can improve business productivity.
In the same Global Workplace Analytics study, Sun Microsystems claimed that since incorporating a work from home strategy, the company was able to improve productivity by recovering the 60% of productive time lost by employees during their commute to work.
When your employee works from home, he won’t be stressed out by the commute. He can enjoy his first cup of coffee, a hearty breakfast, and prepare himself mentally for the challenges ahead.
By the time he gets behind the computer – he’s revved up and ready to go! And when he gets tired, he can take short naps or a walk around the park to get rejuvenated for the next item on the agenda.
Although distractions still abound at home, the employee doesn’t have to deal with the usual stressors in the workplace such as politics and water cooler gossip. He won’t be constantly looking at the clock to check if he has enough time to finish his work and pick up his kids at school.
The Global Workplace Analytics study revealed that businesses lose an estimated US$600 million annually due to office distractions.
Employees become accountable for their work schedules. As the employer, what you’ll focus on are the results.
2. Reduce Operating Costs
Rent is one of the biggest expense items on your monthly budget. If you designate a percentage of your employees as telecommuters, you won’t need to rent as big a space.
You can maintain a smaller workplace and with more areas dedicated to revenue-generating activities. Consequently, you lower your utility costs for electricity, Internet service fees, and water.
Communication expenses can be slashed down significantly because you can incorporate online-based tools that can make communication more efficient and affordable.
Instead of messaging employees via their mobile phones or calling them on the office landline, you can use ZOOM, Viber, Skype, Messenger, or Slack. These services offer free subscriptions but with limited features.
Use these tools to arrange and preside over audio-visual teleconferences. It’s as good as face-to-face meetings because you can share screens, send files, and privately message participants.
Lastly, because more employees are working from home, you can reduce or eliminate office supplies.
3. Lower Attrition Rates
We mentioned earlier how office politics and water cooler chatter can cause distractions that affect productivity. More specifically, these types of distractions can make the workplace feel uncomfortable and affect the morale of employees.
Unhappy employees become disengaged. In addition to the losses in business productivity, a disengaged employee will eventually leave your company and contribute to the cost of workplace attrition.
The cost of replacing an employee is estimated to be double the employee’s salary. In the United States, workplace attrition has cost the economy approximately US$1 Trillion a year.
A study conducted by the American Sociological Review found that people who work from home are happier and perform better than those who work from an office.
Another study by Global Workplace Analytics disclosed that 72% of businesses with work from home arrangements reduced attrition levels significantly.
People who work from home are happier and more productive for the following reasons:
- They are less stressed.
- They have more time with their family.
- They can set aside time for exercise and wellness activities.
- They have more savings because they no longer have to commute or eat outdoors.
- They are less likely to get ill.
If your employees are happy, so will you!
4. Expand the Reach of Your Talent Pool
Another work-from-home strategy that you can incorporate into your business is outsourcing.
Outsourcing is the process of delegating or transferring tasks to qualified third parties. For example, instead of setting up an in-house accounting department, you outsource accounting to a company that provides back-office services.
What are the benefits of outsourcing?
- Lower costs because you contract the services of a company – you don’t hire employees. The cost of hiring an employee is calculated at 1.5-times his salary because benefits are factored in. When you outsource, you pay per project, per productive hour, or via monthly retention fee.
- Improve the quality of work because you’re delegating tasks to qualified people – these are individuals with the requisite knowledge and experience to do the job correctly.
- Increase productivity because now, you can focus only on the core activities of your business.
With outsourcing, you expand the reach of your talent pool. You’re no longer limited to hiring local people. You can outsource to talent located across the globe.
The obvious advantage of outsourcing to remote talent is that you can capitalize on the lower cost of labor. For example, outsourcing to India or the Philippines will cost you less in terms of labor.
That doesn’t mean you get what you pay for. In most cases, you’ll get MORE than what you pay for! If outsourcing to remote locations wasn’t effective, India and the Philippines wouldn’t remain as the top outsourcing destinations in the world.
5. Contribute to a Better and Healthier Environment
If more businesses around the world shifted to a work-from-home business model, we would have a cleaner and safer environment because there would be fewer cars on the streets, less traffic, and lower demand for public transportation.
Because expenses for office supplies would be greatly reduced, there would be less need for paper products. Electrical consumption would be greatly reduced and there would be less garbage to be collected.
If your company is a strong advocate for sustainable solutions that protect and preserve the environment, shift to a work-from-home business model.
Conclusion: Work From Home Could Be the New Normal
We believe that in time, the pandemic will become endemic. But that might take a while.
As of this writing, scientists are still evaluating the effectiveness of the vaccines. Almost on a daily basis, you’ll come across developments that are promising… or underwhelming.
This is to be expected as it usually takes decades before a vaccine is pronounced effective. It’s safe to assume that all of the vaccines are still in their experimental stages.
That’s why if your business hasn’t adopted a work-from-home model, it’s not too late. You can still do the shift – but you should start NOW!
Let’s set aside the pandemic. For the purpose of discussion, let’s assume the pandemic never happened. Given the advantages discussed above, wouldn’t you be encouraged to incorporate a work from home arrangement into your business?
What do you have when you increase productivity and reduce costs? Improved profitability!
Do you want to experience how it is to outsource services? Outsource your web development and digital marketing activities to us!
We have years of experience handling these tasks for our clients. Not only have we contributed to the performance of their businesses, but we also helped them reduce costs.
Give us a call and let’s get started!
And if you enjoyed this article, feel free to share it with your community.
