In this blog series, we successively weigh up the advantages and disadvantages of four working arrangements - onsite, remote, nearshore and offshore - to pave the way for a successful return-to-work strategy that empowers companies to undertake cost management initiatives, improve organizational efficiency and ultimately increase profitability.
As organizations look to reintegrate workforces post COVID-19, there is a clear recognition that alternative working models have both proved effective from a productivity perspective and offer the potential for cost savings. Current remote working environments and collaboration models have been defined rapidly to address the challenges posed by the pandemic. Looking forward, firms are drawing on those experiences to re-assess the advantages and disadvantages of working models. When choosing the correct post-COVID working model, there are four different options to consider: onsite, remote, nearshore, and offshore working models. Every location model has its pros and cons. In the first blog post of this series, we weigh the key benefits and challenges of onsite work arrangements.
Working onsite has long been the standard for most companies. The advent of the internet and advances in telecommunications have seen a gradual but over time tangible change to office working practices. Today1, a growing number of people would prefer to work remotely. In fact, an IBM study of 25,000 adults in the U.S. in the month of April 2020 found that 54 percent would like to primarily work from home once offices reopen2. In contrast, Global Workplace Analytics, in its recently published Global Work-from-Home Experience Survey (2020), shows that only 16 percent globally want to leave the office permanently, with most preferring a mixture of both. Spending about half of the time at each location seems to be the sweet spot for both the U.S. and Europe3.
Let us take the opportunity to review all the benefits and challenges of onsite.
- Teamwork and collaboration
As the author John C. Maxwell famously noted, teamwork makes the dream work4. When working onsite, a strong bond and connection between colleagues and teams typically develops, lines of communication and feedback loops are cleaner, and it is the optimal environment to foster collaboration to achieve common goals and complete tasks.
- Motivation and productivity
When working onsite, employees are on hand to boost one another’s morale. Teammates can literally step in to help each other if a colleague is stuck on a solution to a certain problem. Their physical presence allows for much more instantaneous communication and feedback than through virtual means.
- Direct control
If there is a problem, onsite allows for direct control via ‘hands on’ involvement of key personnel, and fast access to other experts outside the team.
When dealing with client data, it is usually required to work on secure premises and within certain hours to ensure client confidentiality.
- No digital disruption
Onsite allows for easier monitoring and management of employees’ activities.
- Centralized infrastructure and support system
Being onsite offers a more efficient work setup, for instance a fast and stable internet connection, powerful workstations, additional monitors, and access to printers. If someone has a problem with hardware or software, IT support can typically be contacted in person rather than addressing the issue over a dedicated helpline.
In-person interactions can foster and improve relationships5, which in turn serves to reinforce a positive and inclusive company culture.
- High utility costs
Maintaining a furnished, equipped and appropriately staffed physical space to house your employees is not cheap; an office location is a significant fixed cost that generates further costs that ultimately negatively impact a company’s bottom line.
In contrast to onsite working, home working saves a significant amount of travel time and reduces associated costs, especially for those with long commutes. Commuting is also associated with psychological and social downsides, and many would agree that eliminating the daily commute is beneficial to reducing stress levels6.
An office, especially one with an open plan layout, can prove a distracting work environment, with plenty to interrupt an employee’s concentration and detract from their performance.
There is an increased risk of contracting infectious diseases when travelling by public transport7 or having direct contact with others in an office setting8.
Having compared the main benefits and challenges underlying the onsite working model, it can be summarized that working onsite remains the preferred environment when dealing with sensitive and confidential information and for optimizing collaboration. However, it must also be considered that working onsite is often the most cost intensive option.
Of course, in some cases working onsite is obligatory, whether for regulatory reasons (e.g. trading desks), compliance purposes, or due to the handling of sensitive client data. Many banks or financial institutions do not trust VPNs or similar solutions, preferring that employees remain in a building where key operational factors can be more closely controlled. It is also worth noting that there are still elements of the financial services business that rely on paper (e.g. letters of credit). For those processes yet to be touched by digitalization, there remains a clear need for onsite working.
In future, we believe there will be even less justification for onsite work as issues such as ensuring network security will be given more of a priority, and clients will in turn trust solutions more. If one positive thing has emerged from the ongoing pandemic, it is the shift in attitudes toward remote working by a growing number of firms. The case for remote working has never been stronger than it is today.
Capco’s offering includes: Supporting cost management initiatives and enhancing organizational efficiency to define the best location setup; providing hybrid, nearshore and offshore services.
Oliver Geiseler, Partner Austria, Germany & Slovakia
M +49 172 131 8328
4 John C. Maxwell, Teamwork makes the dream work (Nashville, Tenn.: J. Countryman, cop. 2002).