COVID and its variants are pushing back the return dates for staff to the office. For large and small companies alike, it looks like a remote work model or hybrid will be the only workable option, at least for the foreseeable future.
While large companies may appear to have the resources to develop and run their own remote working systems, as is the case for Twitter, for instance, it looks like startups are doing it better.
Larger enterprises have however found it difficult to fully operate from home. One only has to take a look at how the biggest tech companies and how they have restructured their staff over the last few months to illustrate just how much they have struggled to effect a fully remote model for all their employees.
Apple, for instance, was forced to revert back to a hybrid model earlier this year. The company’s dependence on their famous Apple Stores to drive sales forced them to recall their ‘Apple geniuses’ to their stores. They were also joined by top executives and office staff who now have to report to their offices on certain days of the week.
Startups on the other hand have had way more success working remotely. Alex Wilhelm explains this saying:
“While large companies hem and haw their way through the present, it’s my view that the debate is largely over and that startups have won it.
I’ve been on a huge number of calls with startup founders since the onset of COVID-19, and in the last few quarters, it seems that nearly every time I talk to an early-stage company they have a remote, distributed team.”
What is however not well understood is exactly why startups are having an easier time working remotely compared to their larger well-endowed counterparts. Is it just a matter of survival and adaptation or is there a hidden advantage of having a smaller workforce when working remotely?
More importantly, what does this say about remote work? Does it mean that a remote working model is simply not suitable for a large enterprise?
These questions have no easy answers but an examination of the startup scene may reveal why remote work is not only advantageous for them but necessary
Operational costs are no doubt the biggest factor in consideration for any business. Minimize costs while maximizing profits, that is the goal and mantra for any enterprise.
For startups, nothing matters more. Seed or Series A funding can only keep you operational for so long. For most startups, this is just a few months and investors expect working and proven products on the market.
Remote work, no matter anyone’s misgivings, is undoubtedly the cheapest model. Startups being more cost-conscious have only been too happy to leverage this opportunity.
First, there is no need for a physical office, meaning huge savings in rent and office equipment.
Moreover, remote work would also result in huge savings for employees as they won’t need to commute to and from a physical office. By avoiding travel, employees get to keep a large portion of their salaries for their own use. This is key in helping attract high-quality talent as most startups are not able to compete with large enterprises on salaries alone.
Remote work models grant startups access to a global pool of talent giving them an extra hand when competing with larger enterprises for prospective employees.
Startups in Europe, for instance, can find hidden gems in developing nations in Africa and Latin America. This will save money for these companies who will pay less in terms of salaries due to the nature of such economies while also giving opportunities to talented people locked out of the job market due to high levels of unemployment in these nations.
Size and Culture
A startup’s size makes it easier to develop a company culture that is crucial for the success of the venture. Their smaller size makes communication and thus collaboration easier. Even when communicating online, it is easier to feel connected to a smaller team than say a hundred people. Large corporations, on the other hand, are famous for their hierarchical structures that hamper cross-functional communication. This is only exacerbated in a remote working structure where meetings can feel like lectures with no back-and-forth communication between team members.
Startups seem to have won the remote working argument. They have been the best at leveraging every advantage that remote working presents. Large enterprises on the other hand may need to rethink their corporate structures to reap the benefits of remote work.