The pros and cons of virtual teams

Written by: David Burrows Posted: 04/04/2019

BL61_remoteIt’s not uncommon today for people to work in teams that they never meet in person. but Behind the perceived benefits, employers need to mitigate the potential downsides of remote working

Improvements in technology mean it’s feasible for people to move to another continent and still work efficiently. In fact, many companies are setting up small, global teams that work closely together, but seldom meet. Does this represent progress for both employees and employers? Or is it just a way for companies to reduce office costs?  

Carly Parrott, Counsel in the employment team at Carey Olsen in Guernsey, thinks there’s far more to it than that. “Technology is an enabler – its constant development fosters and supports remote and flexible working that’s focused on output and productivity. Teams can now be virtual. Employers can radically increase their talent pool by recruiting globally and ensuring their teams have the right people with the right skills in the right jobs, irrespective of location.”

She adds that this is particularly relevant to Guernsey, where local skills can be restricted and the possibility of recruiting and bringing skilled workers into Guernsey is often difficult.

Jensen Nixon, CEO of tech R&D company Web Administration Resource Management (WARM), takes a similar view towards Jersey, arguing that global working is as much about employee recruitment as retention. 

“In Jersey, we have a limited talent pool and companies that consider remote working can benefit themselves and the employees,” he says. “From enhanced productivity, fewer distractions and higher savings, to better retention rates, geographical expansion and penetration of new markets, there are multiple benefits of working with a distributed team.”

However, remote and flexible working only works if an organisation has three key ingredients – trust, mutual purpose and connectivity. Parrott believes that if one of these factors is missing, it simply won’t stick. And when it comes to connectivity, location remains important. 

Kate Le Blond, Inward Investment Development Manager at Locate Jersey, provides some insight. “We’re seeing increasingly that the digital infrastructure Jersey can provide is having an impact on decisions to relocate business operations here. Having a robust digital platform and a strategic vision for a digitally enabled society in place has been a game-changer for Jersey, and we continue to see it as being a core part of our proposition for businesses looking to relocate here in the years to come.”

Sector appeal 

Are there specific industries more suited to remote working than others? John Davison, CIO of Guernsey-based First Central Insurance & Technology Group, suggests non-customer facing roles are good candidates for distributed working. “And the technical industries are very well suited to remote working,” he adds, “because code is uniform; you can be from any background and speak any language, but you’ll write the same code.”

Parrott agrees that technology, IT, finance and accounting roles are particularly suited, as well as marketing. But she points out that, increasingly, industries such as teaching, transcription, travel and hospitality are becoming forerunners of flexible working.

Richard Sheldon, Group Partner in the Guernsey office of Appleby, says one of the key advantages of global working is being able to provide clients with a 24/7 service. “With a global team – someone in Asia, Europe and the Americas – you’re able to service a client around the clock. This is so much more attractive to a client than working with a company that works nine to five from an office in London.” 

From an employee perspective, studies suggest that flexible working is more sought after than salary. Parrott believes such freedom of choice leads to empowerment and that, in turn, leads to engagement. “Retention levels are higher and morale is more positive,” she says.

“Budgets are healthier (as less physical office space is needed) and employee costs are down (since related travel and working costs are reduced) – it’s a win-win. Declines in stress levels have also been shown, and a dramatic drop in mental health issues and absenteeism.” 

Nixon agrees that reduced office costs are an obvious consideration, but says they are seldom the driving factor. “Yes, remote working is a way of keeping costs down, but just as important is that it allows employees more autonomy and engenders greater loyalty.”  

Nor does he believe that there is a trade-off with regards to productivity levels. Nixon points to Sweden, where remote working has been strongly supported for more than 10 years now. 

“The productivity levels from those working remotely in Sweden is phenomenal. It’s time we look to other economies and see if we can learn a lesson or two from our neighbours and create better work/life balance for all.”

A good work/life balance is a vital element in recruitment. Flexible hours are increasingly a prerequisite for jobhunters in a job spec, as is the option to work from home – wherever that may be. 

By taking the costly and time-consuming daily commute out of the equation, Sheldon explains, employees can give their company a few extra hours by working from home. At the same time, they are able to see more of their family, so it can be a beneficial arrangement for both sides. 

But there are disadvantages to remote working too. True, there may be reduced head office costs, but there is also the requirement for significant investment in communications and technology. 

As Davison explains, it can also make staff progression and career development harder as it can be challenging to move people into management roles if they don’t have a fixed base. The team dynamic can take longer to form, too, as bonding and relationships are slower to develop. 

From a corporate perspective, he adds, it’s harder to instill a set culture or corporate values. There are also practicalities around information and cyber security.

“If you want your business to be able to work in multiple locations, ideally you set up this landscape at the start,” Davison says. “It’s much easier than introducing it later. It’s hard to create multi-location teams in an existing business that’s never done it before as all of the processes, procedures and tech may not be suited to operations that span multiple locations.” 

The human touch

There’s also a danger that remote workers can feel isolated and under pressure in a different way to their nine-to-five peers.

As Parrott points out, remote working is not for everyone. “Some people need human interaction, and the accountability that follows. Some flourish in the ability to bounce ideas around the water cooler and engage with their colleagues. With remote working, employees must take charge of their own productivity.

“In turn, their employer needs to set meaningful and realistic key performance indicators (KPIs) that are tailored to them, and trust they will be getting the job done. Employees are accountable for achieving those KPIs, which takes self-discipline, and is not everyone’s cup of tea.” 

Sheldon agrees that performance and personnel management are potential problems. “If an employee is not performing well, traditional management techniques fall down. Performance management is not just about getting rid of people, it’s about support and training.” 

He adds: “Remote working from globally spread offices can be quite isolating, especially with small teams. Human interaction is important. The companies that implement remote working best are those that get the mix right – using video conferencing to ensure people feel part of a team and ensuring employees come together periodically.”

With this in mind, Appleby organises a staff event in London each year where all team members from offices across the world attend. The event has a business angle, but it also gives representatives from within the company a chance to meet and share ideas.  

Meaningful interaction and engagement are crucial. The long-term success of global working largely hinges on an effective remote manager providing sufficient support to their team and giving them the right tools and space to do their job.

The managers must be effective communicators and sensitive to cultural differences, and ensure everyone knows what’s expected of them and when. They should be available whenever needed and make time for face-to-face meetings where possible. 

But there are limitations. From an HR viewpoint, it’s harder to conduct appraisals because performance is harder to track. As Davison points out, although people who work remotely tend to be self-sufficient (which is a positive), if there’s a problem, the HR process can be more complicated. 

“I’ve noticed that if you have a team member who’s less constructive than others, if you’re all sitting on the same floor the problem tends to resolve itself naturally,” Davison observes. 

“Remote teams that encounter the same problem don’t self-fix or it takes longer. To remedy this, my teams are set up to be collectively responsible. There’s an ethic in the team that they either ‘all succeed’ or ‘all fail’, so negative behaviour is tackled internally through shared accountability.” 

There’s certainly no shortage of legal questions for employers planning to work remotely. Where do an employee’s employment rights exist? How do those rights correlate with an employee’s statutory rights in their place of residence? Which rights are more relevant and can you apply global policies to local employees? What health and safety risks arise from remote working?

There are also potential issues over managing sickness and absenteeism, or disciplining an absent employee. All of these difficulties can be dealt with, but employers need to be aware of their responsibilities and commitments and plan for them.  

As Parrott explains, the contract of employment and having appropriate policies in place is fundamental in not only defining rights and obligations, but in having clear policies for remote and flexible working, personalised KPIs and periodic performance reviews. 

“These are critical,” she concludes, “in ensuring that expectations are set and managed, and that everyone is working from the same page.” 

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