The virtual workplace: The price is right

The past few years have seen a dramatic increase in the number of “virtual workers” — individuals who work in different geographic locations from their managers or peers. Virtual workers aren’t necessarily telecommuters — you can be a virtual worker at a headquarters office, with your team distributed across remote or branch offices. (Telecommuters are, of course, virtual workers by definition.)

Nemertes has benchmarked a ninefold increase in the number of virtual workers over the past five years. Moreover, the number of employees working away from headquarters locations has been holding steady at 90 percent for the past several years. In other words, today’s organizations are more virtual, and more highly distributed, than ever before – and they’re becoming even more so. Watch for virtual workplace technologies — including audio, video, Web conferencing, instant messaging and “real-time communications dashboards” to take off dramatically. The time — and the price — is right.Text

Why? Several reasons, all fundamentally economic.

First is the inexorable upward cost of real estate. Housing an employee in a headquarters location (including facilities rental, utilities and upkeep) costs about twice as much as providing that employee with all IT services combined (hardware, software, networking and support). Move the same employee out to a remote or branch office and the cost of facilities drops to about that of IT. Put that same employee in a home office and the cost of facilities drops to virtually zero. Thus, it makes plain economic sense to push employees as far out into the field as possible.

The second reason driving companies toward a virtual workplace is agility — the ability to respond in real time to changing market conditions without breaking the bank. Companies have saved millions of dollars annually by not having to replace or move employees as they make organizational shifts.

And I’ve already written about the healthcare organization that by moving to a virtual contact center model for its “dial-a-nurse” service not only saved more than US$3 million in facilities costs but also managed to increase its ability to recruit and retain top nursing talent.

But there’s also an economic driver that’s emerged in the past few months and for macroeconomic reasons appears here to stay. For the first time in U.S. history, consumer bandwidth is less expensive than consumer fuel. Think about it: The going rate for broadband connectivity to the home is up to $50 per month (though some business-class services may run as high as $150 per month). If the going rate for gasoline is $3.70 per gallon, those monthly broadband expenditures will buy about 350 to 1,000 miles of commuting (figuring a 25-mile-per-gallon vehicle). That’s the equivalent of a daily commute of between 17 and 52 miles. By enabling employees to work virtually, you’re allowing them to save what’s rapidly becoming a significant line item in their budgets.

The bottom line? Watch for virtual workplace technologies — including audio, video, Web conferencing, instant messaging and “real-time communications dashboards” to take off dramatically. The time — and the price — is right.

— Johnson is president and chief research officer at Nemertes Research, an independent technology research firm. She can be reached at [email protected].

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