Costs of working from home too much for most SMEs
While some corporates are implementing a ‘work from home’ model for staff, the financial realities are likely to make it less viable for most Kiwi SMEs. BetterCo director Niran Iswar says that SME owners have to make every dollar and every hour of productivity count, but the maths doesn’t seem to be coming out on the side of […]
While some corporates are implementing a ‘work from home’ model for staff, the financial realities are likely to make it less viable for most Kiwi SMEs.
BetterCo director Niran Iswar says that SME owners have to make every dollar and every hour of productivity count, but the maths doesn’t seem to be coming out on the side of the home working model.
“Working from home suits some people and some businesses, but one only has to look at the Auckland traffic in the morning to know that most are opting to endure the daily commute into the office.
“One reason more people are opting for the office is the separation of home and work becomes problematic. We’ve had people apply for jobs with us because their companies are making them work from home, and they don’t like it.”
Iswar (pictured below) says the working from home model raises issues of control and return on investment. “We’ve had clients reporting incidences where staff open the laptop and log in to work to give the appearance of working, and then go back to bed. Not everybody is true to themselves, and not everybody is reliable. This means companies have to invest in software and systems that can monitor productivity, which is costly and time-consuming and impacts morale because it raises trust issues.
“There is also the cost of duplication. Each staff member now needs two headsets, one for the office and one for the home. Taking into account health and safety, the company also needs to buy office equipment that is ergonomically compliant for both the office and the home, not to mention two or three computer screens per employee across both locations.”
Cybersecurity measures for the home, where shared networks increase the risk of security threats to the business, also takes money. Office leases are a hindrance because many companies will be locked in for years to come.
“Working from home is nice for staff, and it’s what many people want, but for most businesses, it just doesn’t make financial sense. The office is easier and cheaper,” Iswar says. “You also lose ground on collaboration and team culture. More and more staff are opting for the office because they want and need people around them.”
SMEs that are serious about the work-from-home model should instead consider a hybrid model that allows staff to work from home one or two days a week on a roster system.
“Allowing staff to work from home some of the time is a good perk. It makes you an attractive employer. However, implementing a full working from home model requires a considerable investment in time, infrastructure and money.”
Working from home considerations include:
1. Cybersecurity. Ensure your IT systems have good security in place and preferably a separate Internet connection from the family to protect against network vulnerabilities.
2. Health and Safety. Under the Health and Safety at Work Act 2015, SMEs must ensure workers are not put at risk by their work or workplace.
“What those health and safety needs are will depend on your business, but at the very least, there will need to be considerations around desk, chairs and working environment,” Iswar says.
3. Productivity. “Moving from working with two or three screens in the workplace to a small laptop screen at home will impact productivity, no question. At the very least, you will need to ensure your IT hardware and software enables and tracks productivity.
“Tracking productivity may raise issues around privacy and what is, and isn’t, seen as intrusive. Managers who feel less in control due to flexible working arrangements may be at risk of micro-managing or sending emails late at night or on weekends. You will need to put systems and process in place to manage these considerations.”
Iswar says that some organisations may make considerable savings on printing costs, which is good for the planet.
4. Employment terms and conditions. Iswar says that employers, even those implementing flexible working arrangements, should take expert advice on whether or not they need to revise their employment contracts.
“Consultation with staff, planning and considered investment is essential even for flexible work arrangements. It should not be done without expert advice and very close scrutiny of the financial implications and returns. Nothing would be more costly than going down one path and then having to backtrack because of unexpected consequences,” Iswar says.
For more information: https://www.betterco.nz Photo: Niran Iswar