With COVID-19 emptying offices, newly distributed firms must find the digital tools and management practices to make working remotely work.
Companies without physical headquarters, otherwise known as fully distributed firms, existed and thrived long before COVID-19. Their experience can be instructive to companies that are struggling to establish fully functional remote working arrangements, perhaps for the first time.
Not surprisingly, the first distributed firms were tech startups, and the majority were developers of open source software. The choice to have a remote workforce started as a financial necessity, to avoid the high rents of Silicon Valley and other tech centres. But many stayed that way. One is Automattic, a distributed company best known for WordPress. It was founded in 2005 and nearly all of its 1,200 employees work at home. Others live in both worlds, like payments firm Stripe, which has a head office in San Francisco and a new engineering hub comprised of remote workers.
Distributed firms rely on digital tools like Slack and Zoom, which companies are now adopting en masse to support their freshly distributed teams. They also use a host of other services that span corporate functions, such as workflow management and collaboration apps like Process Street, Confluence and Trello, or Rippling, which manages payroll and employee benefits.
Along with the tools, distributed firms need “novel management practices”, The Economist advises. One is to ensure that when physical and virtual teams attend meetings together, online participants do not feel excluded and know they are being heard. Some suggest not mixing the two groups at all. GitHub CEO Nat Friedman has all participants join meetings virtually, even if they are in the office. It is also important to trust that remote workers will get their work done. Checking on them to excess sends a demoralizing message. Instead, set clear goals and leave it to them to meet them.
Trust requires transparency, and in this regard, documentation is key, says Michael Pryor, co-founder and CEO of Trello. Discussion points that go into decision making should be written down, to help ensure that everyone understands the terms. For this reason distributed firms value writing skills highly, whereas traditional firms tend to favour good speakers. Friedman, who has been managing distributed teams for 20 years, says that good writing demands clear thinking and discipline.
There must be a learning period, and not every firm will excel at working remotely. Many businesses will always need physical locations where people are physically present. But others, particularly those that have outsourced much of their operations to the cloud may eliminate at least some of their offices. “I just don’t think we are going to go back [to business as usual],” says Frank Slootman, CEO of database firm Snowflake.