The time is coming for businesses to have to determine whether full-time remote work is good for their business.
When the COVID-19 pandemic first began to spread early in 2020, employers of all shapes and sizes had to transition employees to ad-hoc work from home schemes. And as it turned out – the world didn’t come crashing down around those businesses as many feared they would. Instead, surveys have shown that 94% of such businesses report having the same or higher productivity levels since the pandemic began.
And that raises a valid question: should more businesses start thinking about making work from home a permanent feature of their operations?
That’s a tricky decision to make. But it isn’t an impossible one. And for the businesses who are open to considering such a move, the key to making the right decision depends on conducting a careful analysis of business needs and weighing it against the possible limitations of a remote workforce. Here are the steps to take to prepare for a permanent shift to allowing remote work and in doing so, figure out if it will be a good long-term solution for your business.
Step one: Break down job descriptions
The first step in making a permanent transition to remote work is to take an inventory of the actual day-to-day tasks that employees were doing on-site. It’s critical to break down everyone’s work to this level because it will help identify current roles that aren’t well-suited to a remote setting and which ones would easily make the transition.
Remember, there’s no reason that your business has to adhere to previously defined job roles. For example, if you discover that there are a handful of accounting tasks that require an on-site presence, they might be consolidated into one new, single position, while the rest of the work gets grouped into new, remote-eligible roles. But don’t get discouraged if you start to find a mountain of tasks that call for a traditional in-office worker – that’s because most workflows weren’t conceived with remote workers in mind and will need some updating.
Step two: Retool workflows
Once you’ve identified the various tasks current workers do that won’t work in a remote setting, the next task is to look for ways to adapt those tasks to be remote-friendly. In general, this effort will go hand-in-hand with otherefforts at digitization and automation. For the most part, anything that isn’t a manufacturing process should yield a path toward a digitized replacement.
At this stage, it’s not necessary to undertake the actual work of digitizing workflows unless it’s already a part of a pre-existing plan to do so. This is because you’ll want to total up the costs that will come with the effort to use in your cost/benefit analysis of your remote work plan. At that point, it might turn out that sticking with in-office work makes more financial sense or that a phased transition is more appropriate, so it’s wise to put off changes.
Step three: Analyze capital costs
In most cases, reconfiguring workflows and preparing your business’s infrastructure to handle remote workers for the long term won’t be cheap. But that doesn’t mean it’s not worth it. To find out, you’ll need to add up all of the costs associated with transitioning your workforce to their new mode of operation and supporting them going forward. And this is where things start to get complicated.
That’s because you’re going to need to factor in everything from at-home liability for employees to new cybersecurity needs and everything in between. And depending on where your business operates, it might incur all kinds of costs that you may not be anticipating, including:
State-mandated employee expense reimbursements
Infrastructure costs (providing secure remote access, at-home work equipment, connectivity)
Remote tech support
Unified communications tools
Costs to break leases if office downsizing is required
It’s important to be as thorough as possible when trying to identify the costs involved. The closer your estimates get to reality, the more informed your decision on a long-term work from home plan can be.
Step four: Calculate cost savings
After getting over the sticker shock that came with analyzing the cost side of the equation, the next step is to look at how the move to work from home will save the business money. Here again, there’s likely to be plenty of cost savings,both obvious and otherwise. And it’s important to recognize that many of the benefits, while indirect, can end up saving your business a small fortune in the long run.
For example, studies have demonstrated that remote workers take fewer sick days and tend to reduce absenteeism overall. And that can save a business more than you might expect. According to the CDC, absenteeism costs businesses the equivalent of $1,685 per employee in lost productivity every year, so even a marginal improvement can lead to significant savings.
And remote work typically results in a boost to employee retention, too. According to Crain’s Future of Work survey, 78% of employees list flexible work and telecommuting options as the most effective non-monetary retention tools businesses can offer. And when you consider that even low-wage, high turnover workers can cost up to 16% of their annual salary to replace, the cost savings realized there might be more than you’d imagine.
Step five: Generate an ROI projection
By now, it should be becoming fairly obvious how well a permanent work from home program might work for your company. If a cursory comparison of your costs and savings shows that you’re coming out ahead, that’s a good sign that things are headed in the right direction. But if it appears at first glance that the costs outweigh the benefits, that doesn’t automatically mean that work from home is a non-starter for your business.
What’s needed is a full return on investment (ROI) projection that looks forward at least five years from the date your work from home program begins. It should account for the fact that year one will likely see larger-than-normal costs owing to facilities changes, one-time technology purchases, and other short-term outlays. But by the fifth year, the combined savings on facilities, turnover, lost productivity, and infrastructure should have put the business more than back in the black overall.
Making the decision
After going through all of those steps, you should now know approximately what it’s going to take for your business to extend its work from home policy permanently for some or all of its employees. You should also know how much the move will either positively or negatively impact the bottom line. But in the real world, that’s not all there is to the decision.
With all of the data in hand, it’s then time to decide if your business has the financial wherewithal to roll out a work from home plan immediately or if it’s a better idea to phase it in gradually. It could turn out that existing facilities leases or capital costs make it impossible to move forward right away. In that case, it’s a good idea to revisit your earlier projections and try to model what it would look like to prepare your organization over the course of two or more fiscal years for an eventual move to a permanent work from home policy.
In all likelihood, you will find that there is a viable path to embrace a work from home model. And once that’s established, the last thing to do is discuss the potential plans with all of the stakeholders involved. Remember, not every employee will be thrilled with the idea of working from home some or all of the time. And not every team will thrive under those conditions.
But if it appears that all systems are go, you should have a decent roadmap on how to proceed. Then, all that’s left is to execute the plan and make whatever changes make sense along the way. And, if all goes well, your business will be all set to face the future of work – and enjoy its benefits today.