We are several months into remote working as the model of choice due to the COVID pandemic. What was a forced adaptation for companies as they tried to grapple with the pandemic became a global experiment into the effectiveness of remote work. Is it really a feasible model for companies even post COVID? And now that we are more than a year into the experiment we can look back and assess the results.
Google Saves more than $1 billion
Come May 2021 and a lot of companies, as predicted, are reporting that remote work saved them a lot of money. This is without any significant impact on the quality or quantity of worker output. Alphabet, parent company of Google is reported to have saved a staggering $1 billion from home.
Most of these were savings from company promotions, travel and entertainment. This equaled a total of $268 million in the first quarter of 2020 alone. Sum this up for a whole year and you end up with savings worth more than $1.4 billion as reported by Alphabet.
Moreover, while the company did hire thousands more workers it did not cause a significant rise in expenses. This is because most of them were remote workers. The result was a 34% rise in revenue while expenses remained relatively flat.
Also, as reported by e-mint “Google is notorious for perks such as massage tables, catered cuisine and corporate retreats, which have influenced much of Silicon Valley work culture. Most Google staff have worked remotely and without those perks since March of 2020.”
Such numbers make a pretty good case for remote work and many founders and managers are wondering whether they can replicate this model in their own companies. Critics argue that remote hiring may only work for large companies as they have already have established infrastructure to support this kind of work. For smaller businesses however, there may be additional costs that may even offset the savings made by say not having to pay office rent, installing and running your own servers and on-site energy costs.
Such ‘additional costs’ may include cloud computing. With more people working from home companies have had to incur costs in installing and running a cloud network. This has come at a cost which again has been rising due to increased demand. Wall Street Journal reported that cloud costs rose 11% in 2020.
However, I am not saying that we should all go back to our offices. On the contrary remote work if done correctly can save companies, both big and small, a lot of money. Leaders only have to change their approach towards to remote work.
For cloud computing for instance, one can choose to view it as investment and not only as a cost. With investments, returns are realized a little further downstream and are not only in terms of cash alone. A well-run cloud network is for instance more secure and robust compared to an on-site run server.
Taking that approach with remote work will reveal that the benefits are much more than just financial. Remote workers are reported to be healthier and happier as compared to on-site workers. Working from home saves one from the hassle of commuting to and from work. This means more time for actual work and sleep, thus less burnout. Also, one will spend more time with their friends and family.
A productivity boost also comes from the fact that remote workers tend to be assessed on their output and not just on the amount of time they sit on their chairs as is the case for office work.
However, while the benefits of remote work do seem to outweigh the office, it is still important to have a working office for say impressing a client or a team meeting. This “hybrid” model is already used by giants like Twitter, Twilio and Google.