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The workplace landscape has changed drastically over the last two years — the pandemic challenged traditional norms and forced companies to embrace forward-thinking strategies, accelerating the transition toward remote work. After experiencing the flexibility this working model offers, many employees are now unwilling to go back to the office. In fact, according to a study by Owl Labs, 46 percent of those surveyed were willing to take a pay cut of up to 5 percent for the chance to work remotely full-time.
Several companies have indicated that they intend to implement permanent remote work initiatives even after the pandemic subsides. Companies generally adopt one of two approaches: remote-friendly or remote-first. But making this transition is not an easy task, and many people don’t fully understand the difference between these two approaches. What are the advantages and disadvantages of each? How can leaders choose the best option for their teams? In this blog, we’ll explain the different organizational strategies and challenges these approaches entail.
Remote-friendly: a hybrid strategy to promote growth
When transitioning from a traditional in-office setting, a remote-friendly model might be a good first step. In a remote-friendly strategy, also called hybrid, employees are allowed to work some days outside of the office. Most hybrid companies have physical offices where operations are carried out, but workers are only required to go in from time to time.
The characteristics of remote-friendly workplaces are:
- Some employees, but not all, can work from home on specific days.
- Work hours are fixed and aligned with office hours.
- Management mainly relies on synchronous communication.
- Most decisions are taken and discussed during in-person meetings.
Challenges of remote-friendly workplaces
Remote-friendly requires a structure to support off-site and on-site employees equally. Since this strategy favors synchronous communication, people who prefer working in-person and sharing office space with colleagues may have an edge over remote employees. Managers are faced with the challenge of avoiding this proximity bias so everyone’s opinions are considered. Sustaining an in-office team also means companies are restricted to local talent pools, limiting the growth and expansion aspirations of hiring in other cities or countries.
Advantages of remote-friendly workplaces
Remote-friendly gives more flexibility than the traditional 9-5 office model. This strategy allows employees to improve their work-life balance and enjoy the perks of working from home. Also, since companies no longer have to accommodate large teams, it generates financial benefits and reduces service costs. According to calculations from Global Workplace Analytics, employers can save up to USD 11,000 per employee by allowing them to work remotely 50 percent of the time.
This strategy can be a good first step for companies growing or transitioning toward remote-first. However, leaders must consider if it is convenient for all employees, how it impacts productivity, and if this model can sustain the expansion and growth of the company with only local talent.
Remote-first: the gate to global growth
In remote-first workplaces, working off-site is the go-to option for employees. This does not mean that there is no place for remote-first teams to work if they need to. Some companies operate completely remotely, but others have a centralized HQ or several offices and coworking spaces where their employees can use if they need to. These companies allow their teams to decide where to work according to their preferences — employees organize their workflow based on established objectives.
The characteristics of remote-first workplaces are:
- Companies design their workflows, workforces, and standard operation procedures (SOP) around remote work.
- Companies often set up offices or coworking spaces for employees to use at will.
- Employees can choose their schedules and work toward established objectives.
- Management communicates and takes decisions via asynchronous communication.
- Remote-first workforces use digital platforms and tools to streamline communication.
Challenges of remote-first workplaces
According to a 2021 employee survey by Globalization Partners, the biggest challenges of remote work are scheduling and time zones differences (26 percent), the process speed (23 percent), and finding effective communication methods (22 percent). These challenges are related to the fact that asynchronous communication is the core of remote-first. While efficient, it requires a constant effort from HR departments and team managers to keep processes on track.
As remote-first companies have dispersed teams, HR departments must deal with international tax, compliance, and legal regulations — which is an added challenge for this working model. Also, some team members might feel isolated or lonely when their only interaction with coworkers is via video calls and messaging apps; therefore, remote-first companies need a solid company culture to welcome newcomers and create an inclusive environment.
Advantages of remote-first workplaces
Allowing employees to work completely remote has several benefits. First, companies save money and resources they would expend paying for a physical space. Even if these companies do have a physical office, they don’t need a big space to fit all the workforce in a single place daily, reducing costs. Expenses such as commuting, rent, and services can be allocated to finance other areas or projects. Second, a company can scale freely without worrying about needing more office space to support the new headcount. According to Flexjobs, during the pandemic, employers in the U.S. saved around USD 30 billion everyday thanks to remote work.
Remote-first organizations are not limited to the local talent pool. Companies can overcome local talent shortages and hire the best talent in the world, while creating more diverse and inclusive teams. In fact, according to research by Globalization Partners, diversity has a direct correlation with more creative teams and improves employee retention.
Remote work is also beneficial to the environment. According to the U.S. Energy Information Administration, CO2 emissions related to transportation reduced by 15 percent during the first year of the pandemic. Remote-first employers can also provide incentives such as promoting the use of green energy providers and subsidizing their services.
Remote work also improves work-life balance and enhances productivity. According to a study by Owl Labs, 67 percent of those who worked from home during the pandemic were more productive than when they worked at an office — and 83 percent felt that remote work helped their mental health.
The future is remote
The difference between opting for a remote-friendly or remote-first approach depends on the company’s current situation and long-term goals. However, the transition towards remote work environments is here to stay. Both employers and employees both benefit from remote work. Employees can focus on achieving a healthy work-life balance and enjoy the flexibility they never had in traditional in-office jobs, while companies reduce costs and gain access to top talent around the world.
The surge of digital nomads and the integration of Gen Z into the workforce will further propel remote work environments. According to a 2021 study by Skift, 11 percent of employees surveyed in February traveled for longer than 10 days thanks to remote work flexibility. By September, this number rose to 23 percent. Companies will have to adapt to this new employee mindset and cater to the needs of upcoming generations that have never worked full-time in an office and value the freedom of remote jobs. It is only a matter of time before working from anywhere becomes the standard, by becoming the spearhead of this new paradigm your organization will always be ahead of the competition.
It is only a matter of time before working from anywhere becomes the standard. Learn more about how we can help you succeed faster by enabling opportunities for everyone, everywhere at globalization-partners.com. Connect with us on Twitter, LinkedIn, or Facebook, check out our 2022 Global Workforce Trends eBook.