The ability to work remotely has been a lifeline for countless companies trying to keep their operations running while the COVID-19 pandemic persists, but few business leaders could have predicted how broad and deep the adoption would be. Many major enterprises continue to have a large percentage of their employees working from home, which signals that remote work — either fully virtual or part of a hybrid model — is driving a seismic structural shift in the ways of working.
CFOs, who are always forecasting and scenario planning for multiple eventualities, are being asked to help develop labor models that include remote work-friendly practices and infrastructure. Doing so can provide several clear advantages for employers, including increased agility in talent management and reduced operational overhead. But these models can’t just be driven by cost reduction; they should be driven by a more variable cost structure that gives employers more ways to support a contemporary, agile workforce.
While remote work can never replace the relationship building and collaboration that takes place in person, when implemented properly, it can provide greater flexibility for companies to manage cost pressures and respond to fluctuating market conditions as well as meet diverse talent needs.
Companies stand to reap the following four benefits if they can successfully transform the workforce in this way.
- Access to broad and diverse talent. Relying on a primarily remote workforce means companies aren’t locked into hiring from smaller talent pools concentrated near central offices. Instead, they can tap into a broad swath of labor markets — including those that are less costly — and continue to build a workforce with candidates that bring diverse perspectives from being in different locations, as well as coming from diverse backgrounds. This also gives companies the ability to strategically allocate resources, including placing talent in close proximity to clients and vendors.
- Enhanced total rewards packages. When it comes to assessing companies’ health, few metrics are more informative than talent retention, which has a significant impact on downstream costs. Our research shows that flexibility in the workplace is one of the most important factors for employees across generations and working remotely is a major bonus. Getting the balance right between providing virtual capabilities and encouraging community, connection, and collaboration is essential to fostering a great employee experience and promoting high engagement.
- Better designed and managed technology. Companies hesitant towards cloud-based ERP systems may finally make the switch due to the positive correlation with cost and time savings. The increased use of cloud apps and collaboration tools will continue to remove location as a barrier for working effectively. With the right resources and technology infrastructure to support remote work arrangements, employers can hire the right people at the right times, start programs that nurture talent, and, ultimately, elevate the employee experience.
- More efficient footprint. The pandemic has forced many companies to reconsider the ways their physical workspaces are utilized, including client experience hubs and locations for employee training. With a primarily remote workforce, companies presumably don’t need larger premises, which could produce savings on rent and utilities, as well as other expenses like commuting and business travel. That’s not to say that remote work is a completely free work model — nor does it sound a death knell for office buildings — but it’s changed the office-first mindset for many employers.
When we look to the future of work, one thing is certain —flexible working arrangements will be important to companies’ success and longevity. Remote work will clearly be one of the enduring legacies of COVID-19 and it will transform entire industries. Those who continue with traditional mindsets, especially regarding talent and work/life experiences, will slowly lose their place in the competitive landscape. CFOs should seize this opportunity to find a balanced approach that supports both remote and hybrid work, as that investment could pay off long after the crisis subsides.
Originally published by CFO on December 16, 2020