The Rise of the Remote Workforce: Benefits, Behaviors and Best Practices
Once the domain of traveling sales and service people, this space is rapidly changing. In the last (5) years alone, remote work, or allowing professionals to work from home or outside the traditional office, has increased by 44% and shows no signs of slowing, especially in light of recent events. Currently, the number of remote workers is rising out of necessity, whether it be temporary or permanent decisions by companies to support a virtual workforce. With technology allowing us to take our lives with us anywhere we go, more people are requesting flexible working spaces. There are many reasons why remote working is increasing in popularity with both business leaders and their pool of labor. Not every company wants to allow employees to work from home. However, there are benefits of having a remote workforce. Not every person should work from home, thus, we will review the personal behaviors that best apply to this style of work and best practices for being a remote workforce manager and an efficient employee. The Benefits There are (4) key benefits to having a remote workforce: talent pool, cost reduction, happier work life, and health. Your talent pool becomes limitless. Hiring the right person comes with many challenges. The company needs to find a person with the right background, customer knowledge, behaviors, and nearby. By limiting the talent pool to around a 25-mile radius (about a 45-minute commute) a company is missing out on top talent. With remote workers, the world now becomes your talent pool. It saves the company and employees money. According to a ConnectSolutions survey, the average remote worker saves a company approximately $4,600 per year. Fuel, car maintenance, commuting time, parking, childcare, lunches are top employee considerations, and this is a good chunk of change most people would like to keep in their wallets. Having remote workers also reduces the amount of money the company has to spend on computers, phones, utilities, office supplies, and on real estate and office leases. A happier work-life balance leads to employee retention. According to Global Workplace Analytics, 72% of employers say remote work has a high impact on employee retention, and 90% of employees feel flexible work arrangements increase employee morale. It is no wonder then that 45% of remote workers have been in the same position for (5) years or more. Remote Workers are healthy. Even before many schools, companies, and even whole countries were put on lockdown in an attempt to stop the spread of COVID-19, research showed that remote workers on average take fewer sick days and can stay productive longer. It has become a lifestyle, with many companies such as Google, Microsoft, and Amazon encouraging work from home– as well as many others who are less tech-centered. Plus, in this new age of social distancing, it is much less likely that an employee will come in contact with any germs around the office. The Behaviors While remote work provides many benefits, both to the company and the employee, it doesn’t mean everyone in your company is ready for this lifestyle. On the contrary, this new work arrangement takes a person with a particular set of skills and behaviors. As we conduct candidate interviews for remote positions, we assess the following behaviors that make for a successful and productive remote worker. These are: Strong Connector and Communicator Enjoys sharing expertise and ideas proactively with other professionals. Prefers and enjoys team projects. Proactively taps into all available knowledge and support resources. A Go-Getter Confident and self-assured. Seeks independence and enjoys due recognition. Driven to high levels of accomplishment. Passionate High stamina and endurance— one who doesn’t count hours on the job. Maintains focus during work activities. Active hobbies and involvement. Integrity Honesty and integrity are hallmarks of how they conduct themselves in all they do. Refuses to cut corners or over-promise. Represents their company judiciously. Astute Skilled in self-appraisal. Quickly sorts the critical from the superfluous in prioritizing – street smart! Acts appropriately— is tactful and knows what NOT to say. The Best Practices As with any mode of work, there are managerial and work practices that lead to success. We have identified six key best practices for remote work: Communicate early and often. Because an employee is not working in the office, communication is one of the essential tools they can use. In a traditional office setting, it is easy to talk to an associate in person if questions or concerns arise. Efficient telecommunicators understand the importance of this trait and use it to work effectively with the rest of the team. Be proactive in your communication with your coworkers and clients. Managers also need to communicate effectively with daily calls or video chats. Daily routine and consistency are a big part of working from home. When working in a traditional office setting, this routine could consist of waking up around the same time each day, taking a shower, making coffee, and commuting to the office. A person who is taken out of the office should still try to do these same things each morning and to keep their regular office hours. This will set the tone for the day. Instead of feeling like you are just staying home, it will make it feel like you are getting ready for work. Managers should also set up routines and consistent check-ins (phone or video) with their remote teams. Set schedule and prioritize. Remote work provides more flexibility but has the potential for a lot less structure. Set a plan of action to make sure that time is productive. When working from home, utilize company calendars to stay updated on office events and meetings. Keep to your regular work schedule hours and agenda while holding yourself accountable to these, as your manager would. Create a separate workspace free from distraction. It is almost impossible to produce high-quality while household distractions abound. TV, walking the dog, and the laundry can wait until after work. Create a separate office area or room, similar to if you were working in an
Exit Planning: It can wait until tomorrow, right?
When asked about succession or exit planning, have you given one of these responses? “I think I will leave my business in three to five years.” “The operation still needs me.” “The business is not ready to be transitioned.” “We are too busy to worry about succession.” “I will easily sell it in a few years and walk away.” “I am just not ready yet.” Or perhaps you know someone who has given one of these answers when discussing their potential exit from the business and retirement? Like starting an exercise program, exit planning can easily wait until tomorrow. However, for the Baby Boomers, tomorrow is here. Business owners born between 1945 and 1964 make up 25% of the population but own over 60% of the small businesses. The high ownership levels result from their surge into the job market in the 1970s and the lack of room in corporate America to absorb a much larger and better-educated employee population. From 1975 until the mid-1980s, Baby Boomers opened new businesses at a rate never seen before and not duplicated since. Today, over 5,000,000 Baby Boomers are preparing for retirement. Just as when they all went to college, started new businesses, and became prolific consumers, they will create a flood of small business sales in the United States. So, what is exit planning, and why should you do it? Also, how do you do it, and when should you start? Exit Planning: What is it and Why do it? When a business broker creates an “exit plan,” it usually involves listing the business for sale to a third party. An attorney’s planning focuses on the legal documents that allow the transition of a company’s assets to new ownership. An accountant or financial planner will look closely at tax and inheritance issues, and an insurance broker offers products that reduce the risk of interruption or disaster. It is logical then that exit planning is quickly becoming a significant focus of the legal and financial communities. Although boomers are healthier than prior generations, they all have to retire eventually. Tens of thousands of professional advisors are positioning themselves to provide tax, risk management, wealth management, and contract preparation services to this flood of sellers. You may be in your 40s and 50s and maybe thinking that this doesn’t apply to you. After all, you have plenty of time. However, the answer to that question is another question: then why buy life insurance? Anything can happen to any of us at any time. Exit planning is another form of insurance— just as you are making sure your family is being cared for, don’t you want the same for your business and employees? There are many additional benefits to starting exit planning early— the process of getting your business transition ready means making it more attractive to investors. That includes, but is not limited to: maximizing revenue, lowering expenses, increasing efficiencies, eliminating owner-centric processes, getting the business modernized, up-to-speed, and more profitable. All of these will have tremendous benefits for you and your company regardless of your exit timing. Examining the strengths and weaknesses of the business, IT systems, management team, and customer base are good continual improvement practices that make the company more profitable in the short-term and make it much more attractive for a potential buyer. How to Plan Your Exit? A successful transition starts by determining the planned date of exit and the post-tax proceeds required from the business to satisfy the owner. The target proceeds should be achievable in the chosen time frame. If they are not, you can extend the time frame or reduce the financial goal. After determining schedules and financial information, there are essentially three options on whom will take over as an owner: a family member, an internal team sale, or a third-party sale. Discussions with accountants, attorneys, financial planners, and others likely feel similar to a complicated maze that makes you not even want to start the process. A trained advisor will help initiate the process and will engage in constant communication with all of the parties listed above, with your control of the process remaining intact. The most effective and efficient approach to exit planning is to select a single professional who can manage all the others involved. Creating new entities or sale agreements is pointless unless the tax implications are first understood. Planning to reduce the impact of income taxes may be rendered moot if a company is not in a position to sell. Putting the company up for sale may be a disaster if an owner doesn’t understand what buyers are looking for and how much they’re willing to pay. Not only will this process determine the best options for your eventual exit from your business, but it also provides a screenshot of the company. It helps to identify areas of the organization that can be improved and what we can outsource to others to achieve the highest sale value possible. Eventually, the planning also leads to a smooth transition, operationally, so that your business continues to be run in the best manner possible by new leadership. When to Start? Retiring Boomers will outnumber GenXers reaching ownership age by 4,000 a day! Studies show that the generation reaching retirement age is 2.5 times more likely to want to own a business than those in their 30’s and 40’s. Thus, this severely limits the small-business buyers in our economy today. It often takes a minimum of 5 years to develop most succession and exit plans—a more realistic number might be as much as ten years. Time and potential buyers will likely be the two most significant challenges for you in this process. Once you have a plan in place, you can implement it whenever you chose. Why wait until it is too late? Get the conversation started with the correct parties now. Are you ready? The single largest transaction and transition of your life deserves special attention. Are you planning to exit
Should You Expect a Thank You Note After the Interview?
Last April, Jessica Liebman, the Executive Managing Editor of Insider Inc., had the sheer audacity to suggest in a Business Insider article that she has a simple rule when she is hiring. “We shouldn’t move a candidate to the next stage in the interview process unless they send a thank-you email.” Liebman went on to state that bringing someone into your company is always risky. However, a thank you email (not snail mail – too slow) signals a candidate’s motivation and desire for the position and generally means they’re a “good egg.” There are only so many data points one can collect in an interview, she reasoned, that sometimes the thank-you note will make the difference in the selection of candidates. She further clarified and stated, “To be clear, a thank-you note does not ensure someone will be a successful hire. But using the thank-you email as a barrier to entry has proved beneficial, at least at my company.” So it makes sense, right? Nope. Unfortunately, it is 2019, and social media and the Twitter-verse went into hyperdrive to condemn her and her statements. Other hiring managers, reputable organizations (SHRM and LinkedIn), and publications joined the fray, with several siding in large part with those who disagreed. It got so bad, Liebman followed up with another article cheekily titled, “Thank you for reading my story about thank-you notes!” a few days later to clarify what she meant. Many people were seemingly offended that anyone would actually “require” sending a thank you note after an interview. She went on to explain she was trying to be helpful and shed some light and that, “The biggest factors we consider are a candidate’s talent and fit for the role.” It was a “rule of thumb” and not official company policy. What were the disagreements and the outrage with Jessica Liebman’s piece on sending thank you notes? Thank you notes are antiquated and pointless [apparently not to her and the many hiring managers and business leaders we talk to daily here at BEST]. Thank you notes are to stroke the ego of the interviewer. Seriously? The application and job description said nothing about sending a thank you. Liebman’s response was priceless on this point, “Neither is being on time to the interview.” Our favorite? Expecting a thank-you note is elitist and shows discrimination and bias because many people have never been taught this skill. Diversity is critical to any organization today. Different perspectives can lead to increased creativity, innovation, productivity, better decision-making, and a better work environment and culture, among many other benefits. However, we have never seen it be used as an excuse not to be courteous and to say thank you. Laziness would be a better excuse. After all, especially in a customer-facing role, would you want anyone on your team that doesn’t know how to say thank you? But it’s a candidate’s market. They [interviewer] should be sending the candidate a thank you. Liebman conceded this point somewhat in that all companies need to do a better job notifying candidates and letting them know why they did not get the position. Point well taken, and it is also something we strive for at BEST. A lot of the outrage on this could be the times we live in – where being contrary on social media is expected and merely aiming for “likes” and that all-important re-tweet. Indeed, social media can help us all whittle down the candidate pool. However, at BEST, we can only speak to our own experience working with clients and candidates and heartily thank those who disagree (because it is indeed helpful). As business leaders, hiring managers, and recruiters, it is often about overcoming buyer’s remorse. When a hiring manager or company leader is getting ready to make a hiring decision, they want that one thing that can put a candidate over the edge and calm their fears about making a bad hire. In talking with a client last month, he mentioned that he really liked the candidate, but he had not yet seen a thank you email. The next day he did without our prompting, and the job offer went out shortly after that. To the client, it was expected as well as another box to check. For the candidates we work with, our resources stress the importance of the thank you email. A candidate should always ask for the interviewer’s email address during the interview (whether on the phone or in person). Rarely, if ever, has it been questioned. After all, it is another opportunity to sell yourself to the prospective company. It doesn’t have to be a long note— say thank you, say that you want the position, and use it also to state why you are the best fit for the role (one or two reasons you are the best candidate for the job or maybe there was something you missed during the interview) and would welcome further discussion. Then, send it within 24-hours while you are still fresh in the interviewer’s mind. Where is the controversy in that? When we were hiring an intern at BEST last year, we had three strong candidates, all with equal skills, talent, and fit for the role. The deciding factor? One candidate went over and above and sent us all a personalized thank you email. He was hired and then became a permanent fixture on our team and has been very successful to date and has a bright future. The difference? His thank-you email. As record low unemployment continues and less skilled workers are available for more increasingly skilled open positions, there are already hiring and employment trends that would have been unthinkable just five years ago. So, as we enter the holiday season, a time for giving thanks and reflection, here is hoping the time-honored thank you note is not one of them. Thank you for reading, and thank you, Jessica!
Salary History? Don’t Ask and Don’t Tell
Last July, Illinois Governor J.B. Pritzker signed into law a bill that prohibits employers from asking a candidate for their previous job salary history. Illinois is not alone. In the U.S., there are currently 17 statewide bans and 19 local ordinances that have acted against discussing salary history. With more states adopting these practices in the next 6-12 months, the question of “why?” comes to mind. Some municipalities, like Philadelphia, are choosing not to follow this mandate, arguing that taking away this question was inhibiting an employer’s First Amendment right to free speech. The fact remains that asking a candidate for their salary history allows for discrimination and does not always provide the top-quality candidate that companies spend thousands of dollars trying to find. As business leaders, hiring managers, and recruiters, we have to ask ourselves— is knowing a candidate’s salary history all that important? After all, we have a set compensation range (low-mid-high) that we have budgeted for an open position. If a candidate meets and exceeds the requirements, qualifications, and behaviors for the role and fits within the compensation range, does it matter? After all, both the employer and candidate win. Maybe the employer doesn’t get the “deal” they wanted or lower their expenses by getting the candidate for less than the compensation range. The candidate may also get a lot more in compensation than they received in their last position. Is that an adverse outcome? Or could it have the effect of engaging and motivating the new employee to increase his or her performance? Think back to your last interview. You were probably a little nervous being the center of attention, knowing that one key answer could land you a job or send you back to the drawing board. You did your research on the role and knew the range a prototypical person in this position would make, but the company has not divulged their compensation range for the job. Then they ask the dreaded question, “How much are you currently making, or what did you previously make?” Most employers assume these guided questions are to measure compatibility between past and future positions. However, for many candidates, this question feels like a trap. If the current salary is too high, the candidate could be pushed aside for being overpriced or overqualified. Indicate a range that is too low, and the candidate might receive less than the value of the job. There are also ethical questions at work. Shift the Conversation When examining questions regarding salary history, there is an opportunity for labor compliance violations. This question allows for disparate impact, which unknowingly discriminates against a group of people, especially women when compared to men for the same position. According to Business Insider, a Hispanic woman makes 53% of what a white male makes in a given year. These statistics vary by state, as some have enacted policies to close the wage gap, but the average data shows that this gap is still very much alive. Assigning a salary based on past employment earnings continues errors of the past rather than righting a wrong and determining the adequate compensation based on the position and responsibilities it brings. By creating laws prohibiting employers from inquiring about salary history, many states feel they are taking a step toward complying with the Federal Equal Pay Act of 1963 and attempting to close the wage gap. How do we move forward and continue to find ways to make sure the candidate matches the role if salary history is now out of the equation? Carolyn Cowper, V.P. of Performance and Rewards with The Segal Group in New York City, advises, “Shift the conversation to the candidate’s salary expectations rather than salary history, then move on to focus on the candidate’s skill set and qualifications for the role.” Recruiters now feel it necessary to ask the candidate what they think they are worth — taking a net worth of all their talents, experience, and assets that they will bring to a new position. For example, one person could make twice the salary of another but only have half of the work ethic and drive. When you take a deep dive into the backend of the hiring process, we see that salary history tells us very little. In a study done by Workplace Culture, they reported that 86% of millennials would take a pay cut if it meant working at a company with a better company culture. Work-life balance, a culture of advancement, and education reimbursements are often more important than compensation to today’s candidates. As a business, it is in your best interest to find people that share similar values and goals to help grow the company into the future. The Market is Speaking Many states agree that it does not matter how much you made in your past job. You should, instead, be getting paid the market price of the current position. Candidates should take it upon themselves to research the standard salary rate before going to the interview, and employers should also monitor this as well to see if they’re competitive. There are many online sources for these statistics (Salary.com, Glassdoor, and PayScale). Company leaders, hiring managers, and recruiters should ask the question by taking a “Total Rewards” approach: What is your desired base salary? Bonus? Benefits? Vacation? Other rewards (for example, educational reimbursement) and then let the discussion progress from there. As record low unemployment continues, and there are less skilled workers available for more increasingly skilled open positions, there are already hiring and employment trends happening that would have been unthinkable just 5-years ago — retention bonuses, extraordinary counteroffers, and even limiting background checks. Even Non-Compete Agreements are on the block. They are already not enforceable in 4 states (including California), and resistance is growing with a Senate bill introduced last year looking for a nationwide ban. In such an environment, it stands to reason that asking for a candidate’s salary history and other employer-favored actions will become history. Be prepared.
All’s Fair in Love and Retention
Employee retention can seem like war in the current candidate market, but it doesn’t have to be. Often, when top-grade managers leave their organization, it is because of reasons that could be addressed by company leadership and have little to do with salary. In our own internal surveys that we use with candidates, “Company Culture” is the number one motivation for making a career move. As recruiters, we often see candidates willing to take up to a 20-25% cut in base pay for an opportunity that provides more of a challenge, a better company culture, more work/life balance, and a “runway” to their future goals. To get your people to stay, you may be thinking, “Well, I’ll just increase their compensation and that should do it.” Or – when presented with an employee that is leaving, “I will make him a counteroffer he can’t refuse.” Worst case, your budget may not allow for it. Best case, you may get another year or two out of the employee, but the underlying issues for them wanting to leave still remain. The good news is that it is not just about compensation. The bad news is that if you’re not taking steps to address employee retention and understand why your talent is leaving, it is open season on your people. We have identified many clients and companies we work with that have excellent employee retention, and they all share the same four components that we call L-O-V-E (L for Learning and Development programs, O for a great Onboarding experience, V for Values and Culture, and E for Engagement). Thus, when it comes to retention, think about making LOVE, not War. Learning and Development How many of us have said to ourselves at points in our career, ”Did I learn anything new today or was it just another day at the mill?” Learning and development programs are proven ways to boost engagement and loyalty. According to Ellie Bertani, Director of HR Strategy and Innovation at Walmart, “I believe business needs to stop looking at employees as a cost center and realize they are an investment. Training them is an investment that will pay dividends in the future.” There are external factors at work as well. According to Niall McKinney, president of AVADO, “As more jobs become automated, employers need to help employees re-deploy in new or more advanced areas. Around 32% of current workers ages 16-54, regardless of their position, may need to retrain within the next 12 years. Research also shows that workers are leaving your company because they don’t see the career path and opportunity they’re looking for. They may have higher expectations, or they simply need guidance. They also may have been thrown into a position without proper onboarding or training and are learning simply by making mistakes, which can be soul-crushing. In a recent Udemy “Workplace Boredom Report,” 46% of employees are looking to leave their companies because of a lack of opportunity to learn new skills. This is where a more experienced counterpart or mentor can provide the training, skills, career/life guidance, coaching, and patience that can help them learn the position, see their fit within the company and culture, and see a future. Do you offer continuing education, seminars, training program,s and other developmental programs that will keep your employees learning new skills? Do you have a portion of your meetings dedicated to best practices or learning something new, or even a simple sharing of information? There is a measurable ROI to upskilling your employees, often in the form of productivity gains and reduced turnover. Onboarding Onboarding is a great tool for welcoming a new team member and first impressions here are lasting. Think about your own career. How many of us on our first day in a new job had to find a temporary workspace since our workstation wasn’t ready? They may not have had our email setup yet and didn’t even have new business cards printed. “I’m sorry, I didn’t get the email that you were starting today,” was often a common refrain. You can feel the love and sense of belonging in your new company, right? According to ServiceNow, 80% of workers experienced some issues when starting a new job. One-third stated they received no training at all, while 28% were unsure of their responsibilities and goals. 20% felt they were not fully onboarded after three months on the job! In fact, that same 80% would rather go on an awkward first date than attend a new job onboarding session or orientation. What do new hires want out of onboarding? In the ServiceNow survey, 58% want a walk-through of key processes or want a “buddy” or mentor they can turn to for questions. According to a recent Harris Poll, 93% of employers agree that a good onboarding experience is critical to influence the new hire’s decision to stay with the company. In fact, nearly 1 in 10 new hires leave a company due to a poor onboarding experience and the attrition rate can be up to 22% in the first 45 days of a new hire. The solution? Have a comprehensive plan for onboarding new hires. Your onboarding may include: a pre-boarding with your new hire (welcome packet and schedule, including a welcome letter from the CEO, sent prior to their first day); scheduled walk-throughs with key department heads; a longer duration for getting acclimated (most successful onboarding plans take weeks or even months); and the assignment of a coach/mentor to help them learn the new job quickly and immerse them into your company culture. Values & Company Culture Company values and culture are more important than ever when it comes to retention. Are you giving people insight into the company’s mission, values, vision and purpose? A good thing to do is write it down, not just have it on your web site, but have it visible throughout your entire operation. According to Bretton Putter, Founder and CEO of CultureGene, “The success or failure of a