5 Reasons CFOs Should Support Remote Work

5 Reasons CFOs Should Support Remote Work
5 Reasons CFOs Should Support Remote Work

Before 2020, the idea of remote work as a long-term, widespread option for workers was one that few companies wanted to pursue. When the pandemic hit, many organizations had to test, tweak and refine what worked as they had no choice but to shift to remote-first work models.

Today, there’s little debate within most companies about the new prominence and inevitable permanence of remote work now that workers are accustomed to this model. As a chief financial officer (CFO), it’s your responsibility to oversee all financial aspects of the business, and one of the most important is to monitor and analyze your company’s financial position.

This involves identifying opportunities that can possibly save on operating costs and expenses. Enabling remote-first or hybrid work environments offers many tangible benefits to the corporate bottom line.

How each company shapes its future is where CFOs hold plenty of influence. Below, we’ve outlined five key considerations for you, as a CFO, to look at while exploring the financial factors of adopting a remote-first culture for your organization.

1. Minimize or Reduce Technology Costs

With remote work technology like virtualization solutions, your organization can give remote workers secure access to virtual desktops and the on-premises applications they need for work. Since virtualization solutions don’t generally require the purchase of new hardware or software, that doesn’t cause any budgetary hit while making the transition to remote work for your organization.

A cost-effective virtualization solution for remote work is virtual desktop infrastructure (VDI), which users can access remotely. The desktop operating system is run and managed in a centralized location and delivered over a network to the end user’s device(s). The user can interact with the operating system (OS) and its applications as if they’re accessing it locally, regardless of the device—whether it’s a traditional PC, thin client, tablet, or mobile phone.

A VDI solution hosts the desktop environment—including the OS, applications, and desktops—on a centralized server and end -users can access their desktops remotely.

2. Eliminate or Reduce the Overhead of On-Site Facilities

When people are able to work from home (or anywhere else), the costs of owning or leasing commercial real estate can be reduced or eliminated significantly.

Medicopy in Nashville, TN, has embraced remote work for nearly all of its 200 employees, and the organization projects they’ll save $350,000 annually in leasing costs alone. Another company making this radical shift is REI Co-op, which announced it will sell its new corporate headquarters in Bellevue, WA, before they even move in.

The actual physical location is just one of many costs that are impacted. The savings add up even more when you consider costs like:

  • Internet service for each location to ensure employees stay connected while working.
  • Electricity to run heat, air conditioning, refrigerators, microwaves, coffee machines, and all your office equipment.
  • Furniture, including costly pieces like ergonomic chairs and desks.
  • Cleaning services to maintain a tidy work environment.
  • In-office amenities, such as coffee, water service and other beverages, snacks, game rooms, and more.
  • On-site security expenses, such as badges, access control, cameras, and other equipment.

Altogether, these costs add up: Global Workplace Analytics found that employers can save an average of $11,000 per year for each half-time remote worker. The more workers who work remotely, the higher the cost savings are for their organizations.

Additional cost savings for some companies can come from shifting events from in-person to virtual, such as the estimated $1 billion Google will save on travel, hotels, and promotional expenses related to employee events.

Even when companies provide a remote work stipend to remote employees to help cover the setup and maintenance of a home office, there is still room to reduce costs based on data that shows employers save an average of $10,000 per year for each halftime remote worker.

3. Decrease Turnover, Relocation Expenses, and Even Salary

One of the biggest expenses in any business is the cost of salaries and benefits. Any steps you can take to minimize the growth or even reduce the costs related to employing the right people without hurting operations is likely a good business decision. . This is where remote work becomes particularly compelling for many organizations, based on insights from this Gartner report for CFOs.

We know workers desire the flexibility of remote work for a variety of reasons. For some, the opportunity to relocate to a place of their choosing comes with a willingness to take a reduction in their salary.

This also benefits companies, that now have the increased ability to hire talent globally, regardless of location. The fair market value for work in different locations can allow organizations to bring in highly qualified candidates for less than candidates who live in areas where the job market supports higher salaries.

Any business is always healthier when the workers are engaged and satisfied with their jobs. Remote work helps maintain this healthy perspective by giving workers something important to them—an improved work-life balance.

In fact, out of the people who worked at home during the pandemic, 75% of those surveyed said continuing remote work at least part-time after the pandemic would make them less likely to leave their employer.

Widespread adoption of remote work since 2020 has made this benefit a non-negotiable for many workers, both when considering new roles as a job candidate and as workers for companies that are making plans to return to the office. Employers that want to return to the pre-pandemic normal may find their ability to retain employees seriously compromised.

Turnover costs are estimated to range between 30% and 200% of a worker’s annual salary, with costs increasing for higher-level employees. This accounts for costs around recruiting, lost productivity, internal knowledge gaps, and more. For organizations that want to avoid the negative impacts of excessive turnover costs, it’s a necessity to enable remote work.

4. Increase Productivity and Profits

In a remote work setting, employees tend to be more productive because they have the flexibility to work when and where they are at peak performance and without the distractions of being in the midst of colleagues in an office.

Remote workers also don’t have a daily commute, which means they can work at more optimal times rather than modifying their daily routine to accommodate traffic or transit timing and limitations. On average, workers spent half the time saved on the commute doing more work.

Giving employees what they want increases engagement, which is also linked strongly to increased profits. In a study from Quantum Workplace, 78% of remote workers indicated they were engaged vs. 72% of on-site employees. Gallup found that business or work units that scored highest on employee engagement had 21% higher profitability.

People who are able to show up every day and be productive while maintaining the balance they want to have in their life are better equipped to bring their best self to the office each day. And their colleagues and employers benefit from their deeper engagement.

5. Extend Hardware Lifespan

You might think transitioning to a remote-first culture will get extremely pricey. After all, you may have to replace desktop computers in the office with laptops for your people to take home.

However, with the right solutions that give remote workers secure access to applications they use for work, you can extend the life of your existing hardware. Similarly, there’s no need to purchase Software as a Service (SaaS) versions of software for remote workers or upgrade legacy software to work on newer machines.

With tools that enable remote work, workers can use their own devices, including smartphones and tablets. This opens up the opportunity to implement a bring your own device (BYOD) policy for your organization.

BYOD policies benefit workers and companies with savings on the cost of new hardware for everyone and by allowing workers to use devices they prefer, enabling them to be more productive. Remote work solutions with advanced security controls can prevent users from downloading data to their devices, ensuring your data remains secure while your people stay productive.

Recent data suggests that more companies may be trying to increase the repurposing of old equipment rather than purchasing new hardware: Gartner reports that worldwide PC shipments fell by 6.8% in the first quarter of 2022.

How Parallels RAS Enables Remote Work

With Parallels® Remote Application Server (RAS) your organization can experience the benefits of reducing operational costs when transitioning to remote work.

Parallels RAS solves multiple remote work challenges:

  • It enables employees to work on the device of their choice while keeping your data secure.
  • It provides teams with the flexibility of working anywhere, anytime, on any device with full access to the applications they need to remain productive.
  • It empowers IT with greater agility and scalability as they support changes in the workplace and address user needs for new deployments of applications and desktops.

For additional reading on how remote work solutions can save on costs, check out this white paper.

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