Distributed teams are on the rise—here’s why

Employees working together, remotely, from all around the world is becoming the norm. Here’s why this work setup is growing in every industry

If you’re not familiar with the idea of “distributed teams” yet, you will be soon.

Distributed teams are composed of employees who work remotely from all around the world rather than being centralized at a single physical headquarters. That means that your head of operations or engineering could be based in New York but her team members live and work in London, Nashville, Detroit, Kansas City, and San Francisco.

For the last few years, distributed teams have become more common in the technology space. Boris Wertz, a venture investor in my hometown of Vancouver, discussed the concept of distributed teams in a recent blog post. He argues that due to today’s competitive labor market, it’s time for companies to buck the traditional wisdom of not building teams in other markets until you have at least 100 employees.

At WeWork, I’ve seen the rise of geographically distributed teams, especially among medium- and large-sized businesses that have between 11 and 999 employees.

While international brands tend to have offices in multiple cities around the world, their teams often sit together at regional headquarters, instead of being spread across multiple locations, working remotely. However, I predict that all companies, including major global corporations, will embrace more flexible and remote working styles. Here’s why we’ll see the rise of the distributed workforce in 2019 and beyond.

It’s never been easier to work remotely

Today, technology connects us instantly. Video conferencing allows us to chat practically face-to-face, and group messaging tools put us in constant contact, whether our teams are in the same city or different time zones.

Technology allows distributed teams to stay in constant contact. Photograph by Nick Tortajada

It’s harder than ever to attract and retain talent

Nearly every business leader I speak to says that their biggest challenge is attracting and retaining talent.

Whether the companies are successful, high-growth startups, or storied brands with celebrated legacies, they all must compete against today’s tech titans, like Amazon and Google, who offer big name recognition, perks, and high salaries. Finding—and keeping—the right people can feel like an impossible task.

That’s where distributed teams have a distinct advantage—they offer companies the ability to meet talent where they are. In some cases, a company finds that a potential employee they’re courting is eager to take the job but unwilling to relocate. Other times, a talented employee needs to move to a different city but wants to remain at the company. In either scenario, the company has two choices: Accept a remote employee or lose valuable talent.

Companies must be agile to survive

With the speed of business moving quicker than ever, companies need to respond to opportunities fast, whether investing in specific initiatives, filling key positions, or moving into new markets.

A distributed team structure can help companies work with more agility. Think about it: If your employees are working from locations all around the world, you’ll have people on the clock for more of each 24 hours. That means they can respond to customers faster, or pass off projects to teams that are just starting their workdays. And if you’re looking to scale into a new market or regionalize products, you could tap into the valuable knowledge of employees who already work from those locations.

The workplace is becoming more employee-centric

More people than ever want—and expect—flexible work arrangements. Seventy-six percent of millennials would take a pay cut for more flexibility. And it’s not just that generation: 96 percent of the workforce needs some form of flexibility, but just 47 percent have access to it.

It’s no wonder; the average person will spend 90,000 hours at work over the course of their lifetime. At the same time, we’re human beings with spouses, children, parents, friends, and passions to which we want to devote our time. An hour or two of extra flexibility each day could be the difference between sitting down to dinner with our kids and spending that time commuting.

Most employees today want and need flexibility. Photograph by VRX Studios

All these factors have created the ideal environment for distributed teams. A distributed workforce can help you hire top talent (regardless of location) and retain them through flexible work arrangements. Technology enables your employees to collaborate effectively—and form lasting friendships. In addition, you can save money on real estate costs because, in some cases, you won’t need to sign a long-term lease on a company headquarters.

One WeWork member with a distributed teams structure is TripActions, a fast-growing corporate travel-management company. TripActions has more than 400 employees in seven offices in the U.S., Europe, and Australia. They strategically hired employees in locations where their customers are, and where there’s big market potential for growth.

“WeWork has enabled us to hire great talent that we otherwise wouldn’t have been able to,” says  Leslie Kurkjian Crowe, chief people officer of TripActions. “Instead of being siloed in our Palo Alto headquarters, we now recruit the very best talent in cities all over the globe.”  

It’s only a matter of time before companies like TripActions will be the norm across every industry.

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Michael Hershfield is the vice president of product at WeWork. He’s spent more than a decade in the startup space in New York and Toronto while serving as COO of Nucleus Intercom, COO of Kitchensurfing, vice president of business and corporate development of Sailthru, and CEO and cofounder of LiveStub. He is also an angel investor, venture advisor at Silas Capital, and a board member at Israel Policy Forum.

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