Millions of people make a living without ever setting foot in an office. Particularly in technology, companies are moving away from just outsourcing rote tasks to remote workers and toward building entirely distributed teams.
One leader is Elance-oDesk, the largest online marketplace for freelance talent. In addition to providing a platform for distributed and part-time work, the company practices what it preaches . Telecommuting in the United States increased by as much as 79% (paywall) between 2005 and 2012.
Elance-oDesk’s engineering lead, Stephane Kasriel, recently released an extensive guide to building distributed teams that combine on-site staff with a larger group of remote workers and freelancers. His team has about 50 people in the Bay Area, and some 200 that are remote.
Kasriel argues that particularly for smaller companies, distributed teams offer a huge cost and competitive advantage. There are great people around the world who are disinclined to move, do their best work outside of an open-plan office, or have conflicting family commitments.
Big businesses can offer higher salaries and better perks, but hiring can be very competitive, especially for high-skilled jobs in places where an industry is concentrated, such as Silicon Valley. The Brookings Institution’s Jonathan Rothbard labor found that it takes an average of 60 days to fill a computer or mathematical science job in the area that includes Silicon Valley:
A scarcity of available talent means higher salaries. The median wage for a San Francisco area tech employee is $123,497 according to data from the tax planning startup Good April. That’s 21% higher than Boston, the city with the second highest wages.
A telecommuting option can allow access to remote workers that are more productive and easier to retain, Stanford professor Nicholas Bloom’s found when he examined a Chinese travel website which adopted the policy. Telecommuting employees also cost $1,900 less in terms of equipment and space over nine months, he found.
Kasriel goes so far as to assert that the only way to find the best possible employees is to be open to hiring remote workers. “Founders say ‘we only hire the best,’ and only look at a 10-mile radius, and only in their network and on Linkedin,” Kasriel tells Quartz. “The chances of getting the best are very small.”
Companies have accepted that remote employees work hard, but they still worry about maintaining a solid organizational culture and about whether employees can innovate and collaborate in large remote workforces, says Michael O’Leary, a professor at Georgetown’s McDonough School of Business.
“I would say these two now trump an earlier concern regarding whether people will get their work done,” O’Leary says. “This ‘we need to see the worker to make sure the work’s getting done’ mentality persists, but it’s waned as people have come to realize that they can hold people accountable for outcomes and standards without visually observing their work.”
Quartz spoke to Kasriel and combed through his book for some of his best tips for running a distributed team while maintaining trust, a cohesive culture, and collaboration.
Don’t skimp on technology
Nothing is more frustrating than working remotely with bad tools. It’s an easy way to lose any productivity benefits.
Kasriel suggests that companies serious about distributed teams should have rooms set up for video conferencing with good screens and cameras, and should pre-screen all hires to make sure they have good internet connections, headsets, and cameras.
Here’s his starting checklist:
Having the technology in place, and expectations about how it should be used, is essential in keeping people accountable and being able to slot them in rapidly. It’s not just buying technology, but investing time in thinking about and explaining how it knits a remote team together.
There are pretty significant upfront costs. But for the most part, these are one-time expenses, and don’t grow much with scale. Besides, adding an on-site employee also comes with costs: equipment, a desk, and real estate. If a Chinese company can save $1,900 for each remote employee, the savings for a company in the Bay Area would be significantly higher.
Remote teams and workers fail when they’re working without direction, sit around waiting for direction, or are duplicating effort. Communication becomes even more important. Kasriel offers a few primary tips:
- Make sure individual teams have at least four hours of overlap in their workday
- Have 15-minute status meetings every day to overcome roadblocks
- Create crystal clear goals and expectations–check in daily on an agreed-upon task list, particularly with new hires
- Have a good mix of synchronous and asynchronous communication.
“With distributed teams, and particularly when time zones, languages, and cultural differences can come into play, it is better to over-communicate,” Kasriel writes.
Don’t create second-class workers
The key to having a distributed team is to avoid creating the feeling that the employees at the main office are the real employees, and those elsewhere exist to do the work that the in-house staffers don’t feel like doing.
“Treat your remote team as old-school, low-value, outsourced labor, then that’s what you’ll get—sub-par work with little documentation from a generally unmotivated workforce,” Kasriel writes.
It takes extra work to include people when they aren’t physically present, and to prevent a “throw it over the wall” attitude. Regardless of whether the remote worker is on salary or a freelancer, make sure they’re included in communication, meeting, and events.