Unlocking Growth: The Impact of Remote Work on Company Revenue

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Dec 15

Written By James Parkes

Unlocking Growth: The Impact of Remote Work on Company Revenue

Written by: Paula Antalffy 4-5 minute read

Remote Work Reigns Supreme for Revenue Growth

A recently published, three-year analysis co-led by the Boston Consulting Group and Scoop Technologies Inc., has revealed that companies embracing remote work experience a staggering four times faster revenue growth compared to their more office-bound counterparts.

The study, encompassing 554 public companies with a workforce of 26.7 million, underscores the undeniable link between remote-friendly policies and enhanced financial performance.

In this article, we break down the findings of that analysis, and examine what businesses can learn from the research results.

Sales Surge for Fully Flexible Firms

The analysis broke down companies into 2 key categories, fully flexible" — completely remote or allowing employees to choose their office attendance — or with “hybrid/onsite” workforces.

The findings are striking: 'fully flexible' firms witnessed a remarkable 21% increase in sales from 2020 to 2022, while those adhering to stricter office attendance policies saw a mere 5% growth in comparison. (The study spanned diverse sectors, including technology and insurance, normalizing revenue growth against average industry rates to ensure unbiased results.)

Surprisingly, these findings go against the ‘more-in-office’ working policy direction among many large businesses, such as Zoom., Twitter (now X), and Amazon. These businesses argue that the benefits of in-person collaboration and company culture, out-weight the positives of full flexibility.

Remote-Friendly Hiring: A Game-Changer

The success of remote-friendly companies can be attributed to their ability to hire swiftly from a broader geographic pool, coupled with higher employee retention rates.

Notably, at Allstate Corp., a significant 84% of new US hires in the past year live outside local office zones, demonstrating the allure of remote-friendly jobs and their ability to attract talent.

This trend is also reflected by employee surveys. Deloitte’s 2023 Gen Z and Millennial Survey shows that both Gen Z and Millennial respondents have a strong preference for workplace flexibility. This is especially significant since these generations make up the future workforce, and therefore will be key in creating workplace trends.

A Compelling Case for Change

In the analysis, Scoop CEO Rob Sadow emphasizes that these findings present a compelling case for business leaders to reconsider rigid office norms. He suggests that challenging the conventional five-day office model may be beneficial, as evidenced by the significant revenue growth observed in companies embracing remote work.

Data-Driven Decision Making

This survey is a pioneering effort to comprehensively examine how different work arrangements impact corporate performance (which differs from many of the survey results shared so far, based on much smaller sample sizes such as data-entry workers (1) in India or call-center workers (2) in China.)

As opposed to narrower studies, this research casts a wide net, analyzing 554 companies across various sectors. The data becomes particularly relevant as businesses navigate the evolving landscape of work arrangements, moving away from traditional, full-time in-office requirements.

Businesses face a landscape of uncertainty as they grapple with policy changes, navigating a multitude of factors that demand consideration - extending beyond their own responsibilities to their board of investors and profits. From the well-being of employees' mental health to the significance of community, diverse cultural backgrounds, disabilities, and beyond, the challenges for finding the ‘right policy’ are substantial.

Contrasting Perspectives

While the survey champions remote-friendly policies, it's crucial to acknowledge counterarguments.

Another study by Mercer, consulting 4,505 full-time US employees, found that those working in the office four days a week reported higher levels of motivation and belonging. The debate surrounding remote work and its impact on employee satisfaction and company culture remains multifaceted.

Navigating the Hybrid Landscape

As of October, a noticeable shift toward hybrid work models is apparent. Only 38% of the 5,565 companies in Scoop's database now require full-time in-office work, marking a decrease from 49% at the beginning of the year.

Striking a balance, Harvard Business School associate professor Prithwiraj Choudhury suggests that one or two days in the office may be the optimal setup for hybrid work, offering flexibility without the isolation of complete remote work.

Despite the growing popularity of 'fully remote' work, a major concern revolves around its impact on company culture and individual mental health. Existing research indicates that 40% of fully remote workers and 38% of hybrid workers show an increased likelihood of experiencing anxiety and depression symptoms compared to their in-person counterparts (35%) (3) .

This raises a critical question for businesses: How can owners and managers establish working policies that enable individuals in a fully flexible workforce to sustain a sense of community and trust within their workplace?

Empowering Teams (with The Right Tools): The Key to Success

Experts recommend empowering individual teams with autonomy over their work arrangements instead of enforcing rigid company-wide attendance policies. Gallup's research indicates that teams collaboratively setting their hybrid policies experience the highest levels of employee engagement.

For businesses looking to take these intentional policies to the next level, investing in creating a wider understanding of what maintaining flexibility looks like alongside their company’s culture of trust and openness. This is a challenging step to take, but it is key to future proofing a business’ employee engagement and retention.

To begin this journey businesses can use innovative solutions, such as the myday App, to begin creating a culture of trust in both in-person and remote workplace settings

The apps integrated social features, helping foster workplace connections regardless of team location. The app’s built-in social support group features allow employees to create communities around shared passions, problems and life experiences.

What’s more, myday's offering of concrete well-being metrics enables businesses to track their intentional work policies against employee wellbeing and engagement. This direct measurement not only simplifies evaluations but also guides informed decisions, aligning individual employee happiness with overall success.

Beyond the workplace, myday's global impact initiatives als reward employees contributing to well-being and community-building. This creates a wider community safety net for employees.