Virtual Office is here to stay

Today more and more companies are allowing their employees to work from home, either on full time or part time bases.  virtual office applications have made this possible.

The Virtual Office is now permanent fixture in American and European companies.  With advances with internet and mobile communication, an employees have everything they need to work right at home.

This article explains the benefits of the Virtual Office and why it is here to stay.  Before we go into details, here are some startling statistics:

  • The average company saves approximately $10,000 per year when employees telecommuters
  • 95% of employers state that telecommuting has a large impact on employee retention rates
  • 14% of American workers have changed jobs in order to reduce commute time.
  • The American Management Association reported that organizations that have implemented a telecommuting program benefited from a 63% fall in unscheduled absences.
  • Out of those companies that utilize telecommuting, 46% indicated that it has reduced attrition.
  • 68% of millennials prefer work from home. companies which offer remote work has access to larger pool of younger workers.
  • 23% of all current employees working in office, say they do at least part of their work remotely. This means most companies already benefit from virtual office without realizing it.

In addition to the benefits to the organization, the average US employee saves approximately $8,000 to $9,000 a year based on spending less money on a commute, lower wear and tear on a car, smaller food bills and less money needed to be spent on clothes.

The new tools like real time collaboration software, have brought virtual office from the realm of science fiction into our every day lives.

Virtual office benefits

Let’s look at some of virtual office benefits and cost savings related to employee retention rates. Read How to manage remote workers for more details about this topic.

Infrastructure:   How companies do save money?  The biggest cost saving is the cost of real estate.

Simply stated, there is no need to lease or purchase a big office space.  No desks, chairs or office equipment are required.   Your virtual employee does not require electricity, food or water.

Companies get the direct benefit from the cost incurred by their employees while working at home.

The employee usually don’t seek reimbursement for costs associated with a home office expenses such as electricity, office beverages and broadband.

Employees will use their own phone lines, fax equipment, air conditioning & heating systems and even personal computer for work related tasks.

Support:  One needs a smaller staff to support a virtual office.  Most virtual employees take responsibility for their own equipment and software.

In most cases they have their own internet access and when things go wrong they fix it themselves. You do not need a security guard to greet her in the office or a cafeteria to feed him.

Lower absentee rates:    Virtual employees need to work autonomously and take responsibility for their work.

An office-based workers often take off unscheduled time because of unplanned family health emergency and other personal issues.  Virtual employees may change their schedule by working at night, but they are less likely to take time off work.

Productivity gains:  Our apologies in advance if the following statement sounds harsh.  Your virtual employee who under-performs cannot hide behind office politics or charm.

When a company uses performance- based metrics to evaluate employees, under-performing virtual employees stand out.

Another factor is that employees save on commute time and often use the freed time by working longer hours or making themselves available off-hours.

As we have discussed in the article Social media is the new corporate welfare, there is also a valid argument that employees work harder when working remotely.

Our recent research study of remote workers support this assessment.

When asked for their opinions as to whether remote workers can work when the office is closed without overtime pay, 69% of respondents Strongly Agreed or Moderately Agreed. A virtual worker does not disconnect from work the same way office workers do.

When an office worker leaves office her mind is on other things. A virtual worker does not leave office and therefore stays on work almost every waking hour.

Life Balance trade-offs:  Work from home helps the life balance issues for most employees.

Most female professionals with children would like to have the option to work from home at least on a part time bases. Remote works lets these employees to work hours that suits their schedule.

A larger talent pool:  The virtual office allows you to hire the best people for the job no matter where they are located.

There are often valid reasons for your employees to be located in specific areas away from the home office.  For instance, proximity to customers is an important factor for salespeople.

Alternatively, if you have a virtual office then there is no need to pay for relocation costs.   Finally, companies can also exploit regional wage differences.    A graphics designer in New York commands a higher salary than a designer with similar skills based in Boise.

If you are willing to consider options in Bangalore, then the potential for costs savings grows significantly.

Remote working has benefits for both the employee and employer. It is an easy win win option for companies to implement.

If done right the benefits help the company’s bottom line tremendously and improves team productivity significantly. The myth co location is the driver of productivity, is just that a myth.

Some jobs require that members work in the same room for an extended period, but not all jobs have this requirement.  The good news is that more and more corporations are considering remote working as an strategic advantage.

David Robins


David Robins is the founder and CEO of Binfire. David studied at both Cornell and MIT, and was the Director of Software Engineering at Polaroid for 11 years.

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