The Brave New World of Virtual Workspaces– a Financial Perspective

The Brave New World of Virtual Workspaces– A Financial Perspective:

The implementation of technology that facilitates virtual work would not only connect teams across globes at a convenient time and place for everyone, but delivers immense cost benefits. The following are the cost advantages of off-shoring:

1. The per hour cost of offshore technical resources is significantly reduced

2. The cost of facilities incurred is zero

3. Zero cost for ramping up the team

4. Additional HR costs such as insurance, provident fund, etc., incurred are nil. All these, including hiring, become the offshore partner’s responsibility. Once a team member is quitting it is the offshore partner’s responsibility to provide an equally competent resource

While organizations primarily use virtual work setups to recruit and retain employees, these setups are also used for long-term reduction in operating and real estate expenses. A clear rise in improved technology coupled with the need for cutting costs have tremendously encouraged virtual work arrangements. A few important and tangible benefits of virtual work arrangements from a cost perspective are as follows:

1. Reduced fixed costs and benefits of cultural diversity

2. Real estate costs are tremendously reduced as there is not necessary for employees to work out of a traditional office setup. Organizations approximately save on an average of $5000-$8000 per employee

3. Elimination of commuting reimbursements

4. Increased employee performance and retention. Improved productivity, which would lead to higher profits and lower attrition which leads to lesser hiring costs

5. Better recruitment and talent attraction

Cost savings from an environmental standpoint:

Due to reduced real estate needs organizations can tremendously cut down on space and fixed costs such as energy. This would thereby benefit the environment as well by reducing the carbon output, usage of fuels such as gasoline, etc. Thus the organization’s investment...