Is the virtual business a reality?

It’s all over the news that Marissa Meyer, the newish CEO of Yahoo, has sent out a memo to her staff telling them that remote working is no longer encouraged, and that they need to show their faces around the corporate coffee-machine from now on.  This hasn’t gone down too well, as you might imagine, especially in a technology business.  So it prompts the question – leaving aside whether or not it is desirable, is the virtual business a practical possibility?

We need to be very careful about the statistics surrounding this area, many of which are being quoted currently.  A large number of these figures focus on the number of businesses that are prepared to allow remote working, which has risen from around 13% to over 50% in the last decade.  The problem is that in general these figures leave out the self-employed, yet self-employment is an area that has seen significant growth over the last five years.

Cynically, one could say that a lot of the ‘self-employed’ are actually people who have been  made redundant and are occupying themselves (with any luck) until they get another job.  Undoubtedly there is some truth in this, and there will always be a proportion of people in this position, but there is a real change that has taken place in recent years, and many businesses still need to catch up with it.

If you manufacture widgets, then clearly you need a factory, you probably need a bit of warehousing, and you need people to operate the machines that make the widgets.  If we work on the assumption that there is still a manufacturing sector left in this country, then clearly there will always be bricks-and-mortar businesses servicing that sector.  The technology allowing you to operate a lathe or a printing press from your home office has yet to be proved.

Business administration, on the other hand, is another story.  The vast majority of administrative functions can effectively be outsourced or carried out remotely, from finance and Human Resources, to IT and customer services.  It may not always be desirable to do it, but it’s possible to do it.

Hiring a full-time member of staff is expensive, and if they are not in a direct revenue-generating role then they are purely an overhead.  Not only do you have the salary, national insurance and pension costs, but you are paying all sorts of premises and IT costs which can run to many thousands a year of additional expense, just to have them sitting in your office.  Unless you are a fairly sizeable business, is that really economically sustainable?

Outsourcing, for example, your HR can make a lot of sense.  Not only do you pay only for the time and services that you consume, but also you will be working with someone who is never, by definition, going to be stuck in your particular corporate ‘rut’ and will therefore be more challenging, more motivated, and more likely to keep you on your toes.  If they make a mistake, it’s a real problem for them as it affects their business – it isn’t a matter of going back to their office and waiting for the fuss to die down.

I appreciate that outsourcing services that are intermittently required is not the same as remote working, but the same logic applies.  Take customer services – this is an area where your ability to respond to your customers is critical.  Typically this boils down to the hours during which they can call you up.  Customer service staff who work remotely are far more likely to be happy to work evening or early-morning shifts, or work at times that they can fit around family commitments.

Today’s telephone systems are more than capable of handling the required call routing, and cloud-based or remotely accessible IT systems make the home office as much a part of the business as the factory floor.  With tools such as Skype, remote access to systems, screen-sharing, Google hangouts, and a host of other communication possibilities, there is no reason for anyone to be out of touch.

The real barrier is one of trust.  There is still a perception that the home-worker will be sitting in front of Jeremy Kyle (in itself a dismissable offence, I would suggest, even if done on your own time!) or spending the day looking after the grand-children.  However, many surveys suggest that people are actually more productive when working at home.  Figures suggest that a significant proportion of the time spent in the office is spent on ‘non-core’ activities – this doesn’t mean just Facebook, but also the day-to-day distractions and the fire-fighting that we all know happen in business.

Without these distractions you can maintain a stronger focus on your work, and be more productive, and avoid that commute.  What’s not to like?  You can interact with your colleagues and also with a wider range of contacts, so the myth of being stuck alone and friendless in your attic is long gone.  Culturally, it might suit you to go into the office periodically, but the bulk of your time can be spent constructively and fruitfully, enjoying a higher quality of life, a lower carbon footprint, and increased productivity.

All we need to do, as a country, is get used to the idea – it is possible, and it will happen.  Business will not go back to the way it was before 2008 – those days are now gone, and the businesses that accept that the soonest will be the businesses best placed for the future.


One Comment
  1. As a “virtual” worker, I appreciate your comments. Look further. I have just lost my mother and instead of inflicting my tears on colleagues, I have the capability to work remotely. That doesn’t’ mean that I have the capability to skive. Everyone in my network can see whether I am online and available. During the Olympics we were actively encouraged to work remotely. The virtual business is a strong and ongoing reality. Please don’t publish my name. Thanks.

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