Board room

Some business will always be conducted face-to-face. You can’t get your car repaired by email after all. But new technology means that even complex work tasks can now be completed remotely. Plus, the law has adapted to allow more people to request flexible working. Should small firms embrace this trend, and save money and hassle by bypassing physical premises altogether?

Small firms are already flexible

Small and medium-sized enterprises (SMEs) are leading the way when it comes to flexible working. Two out of three smaller companies in the UK allow staff to work flexible hours, part-time or from home for some of the working week, according to research from Lloyds Commercial Banking. Experts predict a hike in those asking to work remotely since the law changed in June to allow any employee with up to 26 weeks’ service to request the right to work flexibly. So, many small firms are already well-placed to embrace greater flexibility, even if that means creating a totally virtual workplace.

Building infrastructure

For smaller companies, working without premises has its obvious attractions. Property-related costs – rent, insurance, and business rates, for example – are one of a firm’s greatest expenses, along with staff wages. But business owners need the correct infrastructure for an office-free enterprise to function properly.

Getting IT right

Having the appropriate technology set-up is essential when your workforce is physically scattered and wholly dependent on your digital network to operate. A powerful and secure cloud computing service is likely to be a requirement. This can be expensive, so shop around and get advice before you buy. The Information Commissioner’s Office is a good place to start for basic information on cloud computing for smaller firms. Think about how staff should communicate, be it via audio, video or a written medium such as email or instant messaging. You should map any technology to the business’s needs, not the other way around.

Test your systems. You want to know the strength of network connectivity, and how the working platform operates under stress and at busy times before you commit to using it. Most suppliers will allow a free or low-cost test period, so take advantage of it.

Be secure. First, decide whether to allow any employees to use their own computers and digital equipment or whether to provide the necessary kit yourself. Either way, all hardware and software has to be sufficiently secure to protect your company’s systems and information. It’s sensible to get expert help identifying what security controls are needed. The Institute of Directors also has a starters’ guide to online security issues for businesses.

Check employees’ home set-up. If staff are going to be working from home you need to be certain their internet connection is strong enough to cope with work demands. There may also be health and safety concerns to take into account. The Health and Safety Executive has more information on circumstances when risk assessments of workers’ homes may be necessary.

Keeping motivation alive

A major challenge of building a business without a physical base comes when you hire staff. Keeping employees motivated and productive at a distance is not easy, but it is possible. Acas, the conciliation body, recently commissioned experts from the London School of Economics (LSE) to study home working, and one interesting finding was that leadership is more important than technology in an effective remote working culture. The LSE identified four elements that are particularly relevant.

Trust. Managers who want to maintain direct control aren’t likely to find remote working a comfortable experience. Bosses must learn to evaluate an employee on output rather than observable behaviour.

Managing performance. The performance of remote workers should be assessed using previously agreed measures. As well as monitoring the quality and quantity of work done, some companies also ask staff to keep a diary of tasks that they tackle. Others prefer to schedule regular meetings between managers and employees to check progress.

Communication. This is the key to successful remote working. Keep in touch with employees via email, phone and face-to-face meetings. It’s also important to get people together from time to time even if they usually work apart. Ad hoc meetings and ‘water cooler’ updates simply don’t happen with a remote team, so planning is required.

Training. You may need to get training for managers to teach them how to direct and motivate a workforce that isn’t physically present. Also, don’t neglect the skills of your out-of-sight employees. Tech training could be particularly useful – research last year from TalkTalk Business suggested that firms that give priority to IT training gain the equivalent of one employee for every 20 other members of staff. Such skills could be even more valuable in a remote worker than an employee who is present.

When it’s time to give in and get premises

Even in the 21st century, there are still reasons why a business owner may finally decide it’s time to take on a physical workplace.

You want to give the enterprise a more professional polish.

The business owner decides they want a division between work and home.

Staff numbers have reached a point where it is more practical to have all or some of your employees gathered in one place.

Customers expect an office or place of operation where they can engage with the company in person.

Not having a central hub appears to be hindering business growth.

Whatever the push to look for commercial property, there are many practical considerations when deciding where to house your SME. The Royal Institution of Chartered Surveyors (RICS) has produced a guide offering advice on everything from finding the right kind of space, whether to buy or lease, right through to tax issues and lease negotiations.

As said, some businesses will always need a shop front to operate, while others will evolve to a point where a bricks and mortar workplace seems the best option. Many more will exist in the future on the move and without a specific location. But technology is giving all of these types of enterprise greater freedom. And SMEs are at the forefront, embracing the flexibility that comes with this freedom with gusto. Perhaps it’s time that the minnows of the business world taught their larger peers a thing or two about innovation.

By Alex Littner, Boost Capital