Virtual Companies: How Your Team Can Successfully do Without an Office

Jan Tissler
9 Min.
Virtual companies

Some have been preaching for many years that remote work is not only a stopgap solution for exceptional cases. For example Matt Mullenweg, the co-founder of WordPress . Doing without offices altogether can be an opportunity to work productively and successfully. What is behind catchwords like "virtual companies" or "distributed companies"? And what do you need to keep in mind?

The year 2020 has introduced new abbreviations like "WFH" aka Work From Home. Many a company was suddenly confronted with a topic that had been ignored until then: It had to work without offices. Those who were not prepared for it, fell unsurprisingly into a deep productivity trough.

Less micromanagement

This happened simply because not even the basics were available: The necessary tools were missing completely or turned out to be insufficient. But it is not only about the right tools. The way virtual companies work must change fundamentally. How tasks are planned and distributed to employees works differently. The so-called remote leadership for agencies and companies needs more freedom and more trust - and significantly less micromanagement.

Some of these companies (and their managers) certainly long for the day when they can return to "business as usual". Perhaps the (occasional!) home office will then remain as a bonus to boast about in job advertisements. In practice, however, these organizations will continue to be focused and optimized on the office and physical presence.

Working from a distance at that moment is not a recognized alternative or even the more sustainable model, but the exception and is seen as a half-full copy of "real work" on site. At the same time, one pretends that "real work" and cooperation is only possible if all persons are in the same room or at least in the same building at fixed times.

It doesn't even occur to you that Remote Work its own merits could have. Or that the model is the better option for some tasks and occupational groups. Then it seems absurd that companies could benefit from being a "Distributed Company".

Example Automattic: Remote by conviction

All the more astonishing when successful companies have never been organized differently. Sometimes this was a necessity, because there was no budget for an office at the beginning. But then it remained with the model because it had proven itself.

Best example among many others is the company behind WordPress .com and WooCommerce: Automattic. Founder Matt Mullenweg likes to talk about how "experts" wanted to make him understand that this model would never work with more than a dozen or two employees. Today, Automattic has nearly 1,300 employees - and still no permanent offices.

WordPress  Automattic Team
The Automattic team - distributed worldwide

In fact, until not so long ago, the company even had something like an in-house coworking space in San Francisco: you could go there to do your work and meet your colleagues. But it was used less and less. So Automattic saved these rooms a.

This year, Matt Mullenweg could feel confirmed in what he has been preaching for so long: The future of many companies is a decentralized structure without offices. "The illusion that offices are about work is destroyed forever", he wrote in a blog post. In the end, it's more about control than about creating a helpful and supportive work environment.

The 5 levels of distributed enterprises

It has established a model for distributed or virtual enterprises based on the stages for autonomous vehicles. It reads as follows:

Level 0: Remote is not an option

Remote work is not possible, because you have to be present for the task. One thinks here of craftsmen, salesmen or even firemen. Of course, there may be situations and future developments that change this at least in part. Think of remote-controlled or semi-autonomous robots that help to fight fires. But as things stand today, this is not possible.

Level 1: Remote is only for emergencies

Many companies found themselves at this level before the coronavirus pandemic. Remote work would be theoretically possible, but there is no support for it. In an emergency, employees can even work outside the office for a day or two. But most of the time, most of the work will then stop. This is partly because even basic tools such as your own e-mail account or calendar are difficult to access once you are no longer in the internal office network.

Level 2: Remote is possible, but only exceptionally

Many companies had to rise to this level because of the pandemic: they were forced to accept that many or all employees would work remotely for a long time. To achieve this, the technical foundations were laid and new tools such as Zoom and Microsoft Teams were introduced.

But the processes and models of thought have not yet changed. Instead, an attempt is being made to transfer the previous working methods to the digital world. That works about as well as the "e-paper" version of a daily newspaper on a smartphone: it works with effort, but not really well.

In the case of remote work at this level, this means that everything continues to happen synchronously and you are constantly interrupted. Supervisors are worried about the productivity of their teams, but this does not mean that they change the boundary conditions. Instead, software should ensure that the employees are actually only working on their projects, or you have to prove that you are actually "present" via a webcam that is constantly switched on.

Level 3: Remote as an opportunity

From here on, working outside of an office is no longer seen as an emergency solution with many disadvantages, but (also) as an opportunity. One creates a better working environment at home or in a coworking space and the company realizes how valuable asynchronous working can be. Communication takes place more in writing. The personal component also plays an important role (without being restricted by a pandemic): teams meet for one or two weeks a year.

Level 4: Remote is the new normal

Once here, the processes are consistently asynchronous. Work performance is assessed on the basis of the results, not whether and for how long the employees are present at a location. Trust develops and becomes the basis for cooperation. Not only extroverted "speakers" are heard with their opinions, but everyone, because there are many ways to participate in discussions.

Companies can attract talented Winning employeeswho do not happen to live near the offices or are willing to visit migration . Employees' home offices are usually better equipped and much more geared to individual needs than an average office. Meetings in real time are well prepared. Diversity is also strengthened because each person can do his or her job as it suits him or her.

Level 5: Remote Nirvana

Matt Mullenweg sees this as the "nirvana stage" that may not be attainable. It is rather intended as an incentive. At this level, distributed companies are always better, more successful and more productive than their competitors with offices. Employee satisfaction is maximum.

Dropbox becomes "Virtual First"

In general, companies such as Automattic, Buffer or Doist have an easier time of it because they have relied on distributed teams from the very beginning. They had to make sure that their model would still work with a growing team. But the basic ways of thinking and acting were already there.

It will be more difficult for companies that have to convert - as is the case with the Coronavirus Pandemic happened. For one thing, they often found that Remote Work is not as bad as they always thought. On the other hand, some employees also liked this forced experiment very much.

For example, Dropbox in a formal communication on record that 90 percent of the 2,800 employees felt productive at home and did not want to return to a strict five-day week in the office. Admittedly, they also saw disadvantages in working from a distance. "Uninterrupted video conferences, constant alerts and social isolation" are cited as examples.

Dropbox Blog
Dropbox is also a pioneer on the subject of "Work Culture" in the blog

Matt Mullenweg would point out, however, that Dropbox would just have to dare to go to the next level. These "disadvantages" are signs that the office way of thinking has been transferred unchanged to the remote world.

As it seems, Dropbox wants to work on it exactly. So there will be offices called "Dropbox Studios" all over the world. This includes existing locations such as San Francisco, Seattle, Austin or Dublin. But there will also be "rooms on call for team meetings" elsewhere. The communication states

As a result, Dropbox is expected to become more geographically dispersed over time, giving teams more freedom to choose where they live, work and find new employees

Where these "studios" are available, the company wants to adapt dynamically according to demand.

But as the step-by-step model above explains, organisational changes are also part of the new, location-independent world of work. Dropbox speaks here of "non-linear working days". In future, the company will only determine "core hours of cooperation" where time zones overlap. It encourages its employees to create their own schedules away from this. "Dropbox wants to prioritize impact and results over hours worked." Sounds almost like someone went to see Matt Mullenweg...

Dropbox is also only the latest example from the tech industry. Twitter and Square had already announced that they would allow temporary home offices to be used as an unlimited alternative. And Facebook's Mark Zuckerberg predicted that 50 percent of his employees will be working remotely within the next ten years.

8 tips for virtual companies

But how do you find your way in the new world of distributed work? The company behind the Todo-App Todoist has published in a blog post eight useful tips compiledto make Remote Work work better:

1. find your own solutions

Just because another company is successful with a certain tool or way of working does not necessarily mean that it suits you and your company. Always look at what the basic problem is and then look for a solution that fits. Example in the post: The company tested Slack as a communication channel because so many use it. However, Doist found that it was not well suited for his global team.

2. set to Remote First

In organizations that rely on a hybrid model, remote workers quickly fall through the cracks. They are forgotten when it comes to communication as well as promotions. Instead of just enabling work from a distance, they should be actively promoted. It should become the new normal.

3. use asynchronous communication

Their example is mainly about international teams. But even people who are not spread across the globe have their own personal "time zones". Some people start early in the day, others prefer to work in the evening. Some need several hours of uninterrupted concentration, some work in short shifts.

4. use synchronous communication very specifically

Nobody claims that every question, every problem, every challenge can be solved via chat. But instead of considering synchronous communication like meetings as standard, they should be a well planned and prepared tool for special moments. This applies, for example, to complex questions, emergency situations or to help team members get to know each other better.

5. document workflows and rules

The better you record how something is to be done in a way that is comprehensible to everyone, the fewer queries there will be. Good documentation also ensures fewer misunderstandings and conflicts in the agency or company.

6. be careful when hiring new staff

Not everyone is well suited for a remote work environment. You have to be able to handle planning your own work and take more responsibility. Communication skills must also be strong (especially written). Matt Mullenweg, for example, has explained that at Automattic they don't conduct job interviews, but job application chats.

7. trust is the basis of everything

This is a particularly difficult point for many a leader. Productivity is not when someone looks busy (sitting at a desk in the office, for example), but when results are achieved. There must be confidence that employees are doing their jobs to the best of their ability.

8. do not ignore the negative sites of Remote Work

For it is equally clear that such experiments have failed in the past. Think of prominent examples like Yahoo and IBM. So you should by no means assume that this topic is a foregone conclusion. Rather, you should look at what has gone wrong in such cases and how you can counteract it. It is also important that all parties involved are informed about the advantages and disadvantages for them are personally aware.

My conclusion for agencies and companies

What many still do not understand: More design freedom does not reduce productivity, but rather increases it. As various studies have shown, "more money" as a reward only works for very simple tasks. As soon as people have to put in even a little intellectual and creative effort, this lure turns into its opposite: The greater the reward, the worse the result. See this animated version of a talk by Dan Pink:

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Generally speaking: people want to do good work, they want to develop themselves and they want to live self-determined lives. If Remote Work is implemented correctly, it can give a positive boost to employee productivity, satisfaction and health. And, as mentioned above, such flexible working models open up companies to candidates who would not have been considered earlier.

Virtual companies: What questions do you have for Jan?

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Picture: Olia Danilevich

Jan is an online journalist and digital publishing specialist with over 20 years of professional experience. Companies book him as an author, consultant or editor-in-chief. He is also the founder and one of the editors of UPLOAD magazine. Photographer Author's picture: Patrick Lux.

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