Remote workers - the real costs and benefits
More telecoms costs, more support hassle, but better work.
By Johna Till Johnson, Nemertes Research | Published: 01:00, 31 December 2004
No question about it, we've entered the era of the virtual workplace. While companies have talked for years about the concept of enabling workers to work from anywhere, 2004 marked a milestone in actually achieving that goal. Nemertes Research LLC recently quantified a nine-fold increase in "virtual workers" - those who reside in separate locations from their managers - over the past five years. That means more salespeople out in the field with prospects and customers; more geographically independent contact centres; and more knowledge workers working at home.
Telecoms and support costs go up
But this geographic independence has its price - one with which network managers might be well aware. Up to 40 percent of an organisation's telecom costs can be linked to supporting these remote workers. Cellular services, digital wireless offerings, and remote-office Internet and VPN access can cost a company nearly as much as its traditional frame relay and voice services.
Moreover, it's tougher to provide IT services to remote workers. Employees in main offices have access to extensive IT support, but employees in remote or home offices often have limited options when it comes to PC meltdowns or network problems.
While software is available to enable remote teams to collaborate effectively, it too has its price. Audioconferencing, videoconferencing, Web conferencing and presence capabilities can cost an organisation hundreds of dollars per employee to deploy. And for these tools to be effective, every employee - not just remote workers - needs to have them.
The benefits are real
So if having virtual workers increases a company's network, support and collaboration costs, does it make sense for companies to move in this direction at all? Actually, yes. There are several major advantages to actively promoting a virtual workforce, including:
- Dramatically lower facilities costs.In the US, it costs between US$10,000 and $20,000 per year to house an employee in an office in a major metropolitan area, and between $6,000 and $10,000 to do so in a smaller city - UK costs are of a similar order. Moving employees out of headquarters and into remote or home offices can save companies millions of dollars per year. And keep in mind, these numbers dwarf the cost of IT support for these employees.
- Increased agility. Minimising the impact of geography lets employees be closer to customers and prospects and eliminates the need to relocate key employees in response to organisational changes (just because you now report to someone in Miami doesn't mean you have to move there).
- Increased employee retention. I've spoken to large organisations that have effectively stopped requiring employees to move to be closer to their bosses. A side advantage is that employees stay longer, and their institutional knowledge is maintained.
The biggest challenges to managing virtual workers are cultural. Some employees "go Dilbert" - they stop working when they're out of eyesight of their managers. For others, losing the structure and protection of a workday that actually starts and ends means they'll work 24/7 until they hit burnout. Managers need to know how to cope with both types: Real-time collaboration tools can help there, too.
Johnson is president and chief research officer at Nemertes Research, an independent technology research firm. This article was originally published in Network World.