Working from anywhere: A differentiator in the war for talent? By Olivier Meier, Mercer The article was first published on Brink News on 29 May 2022. The extensive use of remote working during the pandemic has forced organizations to re-imagine their work setup and generated new expectations among employees. The question of remote working is becoming more complex as organizations have also had to deal with employees seeking to work across borders — “working from anywhere” is the new buzzword. Remote working is moving from being an emergency temporary measure to being an important component of the talent management strategy. In a context of talent shortage, companies are more likely to increase work flexibility to attract and retain employees, but without a clear and consistent remote work strategy, they could be exposing themselves to unnecessary risks. Seventy-six percent of companies view compliance as a challenge when implementing international remote working policies. The risk of triggering new tax liabilities, breaking labor laws, triggering immigration or data privacy issues is significant if safeguards are not in place. However, looking at this issue purely through the prism of compliance issues obscures the real question about the purpose and benefits of working from anywhere. Organizations will benefit from the rise of international remote working if they can leverage it for talent attraction purposes, measure its value accurately and articulate a coherent proposition for mobile talent and business leaders. New talent-sourcing opportunities The desire to work remotely has been accelerated by the pandemic, but it follows a steady rise of employee-driven mobility. We have seen a rise in the number of digital nomads seeking opportunities without waiting for a company to relocate them as well as corporate nomads who stay with their employers but proactively request gigs and projects in other parts of the organization — a very different mindset from the rigid expatriate assignment model. The paternalistic company-driven assignment model is giving way to a more fluid lifestyle contract with employees. These expectations from employees may not be sufficient to prompt organizations to manage complex remote working issues if they did not come at a time of talent shortage and reskilling needs. This second trend is motivating companies to dedicate more time and resources to employee attraction and retention. The focus of talent mobility policies is shifting to talent sourcing and development. However, companies can assess the relevance of working from anywhere for their own business strategy only if they have an understanding of the value it can generate. Measuring value Managing international remote working still remains an ad-hoc exercise for many HR teams and often involves assessing situations on a case-by-case basis. The important question is not so much regarding whether international remote working is feasible, but what level of resources the organization should dedicated to it and what value will result from it. Measuring the value of the new work setup is a complex exercise. Rather than looking for the perfect return on investment formula, companies often rely on a cluster of indicators, including subjective feedback designed to capture employee satisfaction. Recruitment indicators can also help assess more objectively the effect of remote working policies on talent attraction. However, the true measure of success can only be assessed over time by monitoring the career progression, productivity and retention rates of international remote workers compared to their onsite peers. Know what ‘remote work’ means for your organization Once the possible value of international remote working has been clarified, the next step is to have a clear and consistent value proposition. Grudgingly accepting international remote working requests for fear of losing key talent does not amount to a clear strategy. More worryingly, unclear communication could lead to a gap between employees’ expectations and the companies’ policies. Because there is no universally accepted definition of what “working from anywhere” means, the risk of misunderstanding is significant, especially if companies make no effort to research the specific needs of their employee groups and communicate their vision. Some scenarios involve frequent moves between countries, which can be difficult to manage from a compliance perspective. Others allow employees to work remotely from abroad for a few weeks or months to minimize risks. Some companies are offering employees a one-time permanent transfer to a new location, rather than the flexibility to move frequently between locations. Cultivating inclusion Not all managers have experience with remote workers. Nearly three-quarters of employees believe that their organizations will be more successful with remote workers. However, 78% of executives are concerned about the ability of remote employees to build solid interpersonal relationship with colleagues and leadership. Seventy-two percent are concerned with the potential deterioration of the organizational culture. Bridging this perception gap will require training and coaching for remote workers and their managers, creating a safe environment to share concerns and well as further investing in collaboration technology. Potential winners in the new world of working from anywhere Organizations competing for the same talent pools will increasingly leverage flexible working policies to gain the advantage. The pressure to act is growing as many managers anticipate that working from anywhere could become a standard in their industry over the coming 10 years. In this highly competitive new world of work, there will winners and losers among companies but also corporate functions, employees and even countries. Companies: The most successful organizations will offer a manageable yet appealing remote working program for skilled talent. If remote working is presented as just one more benefit or imposed on rigid structures, it may be perceived as an ill-conceived afterthought by employees and be resisted by line managers. Successful companies will be the ones moving from a paternalistic approach to a more collaborative partnership with employees to determine what would make a difference for them. Team dynamics: The rise of remote working leads to the creation of new roles and more collaboration between functions. Addressing the complexity of working from anywhere requires input from several teams including HR, legal, and risk management. Forty-two percent of organizations report having a new dedicated role for flexible/remote/hybrid work and 39% are planning to introduce one in the near future. HR teams will be successful only if remote work strategies go beyond compliance issues and show a willingness to revisit their assumptions and models about work practice. Employees: A clear majority of employees support flexible remote working, and the talent shortage means that highly skilled employees can negotiate work setups that suit their lifestyle. However, some employee groups might not adapt to remote working and risk becoming perpetual outliers. Companies are increasingly aware of this risk, and 56% declared integrating diversity and inclusion consideration as part of their working from anywhere policy. International remote working could also lead to a new wave of job delocalization: Companies could move jobs to people to save costs. The pressure to constantly upskill affects both organizations and individuals. Professionals whose skills are not in high demand might be struggling or face increase competition in the new world of working from anywhere. Countries and cities: Companies are not the only ones striving to attract mobile talent. A number of countries and cities have been positioning themselves to appeal to digital nomads and mobile employees. The evolution of technology, business needs and employee expectations often outpace that of tax and labor laws. This explains many of the issues that companies face when trying to setup remote working arrangements. The countries that can adapt their rules to facilitate international remote working could become hubs for mobile employees and freelancers. The most successful ones are currently those combining flexible rules for mobile talent, high quality-of-living and reasonable cost-of-living. But working from anywhere also offers new opportunities to revitalize smaller cities and less developed regions. Looking ahead Working from anywhere is still a new and vague concept, but pressure is mounting on organizations to develop a clear point of view. The evolution of technology, employee expectations and talent sourcing needs all push in the direction of more work flexibility. Organizations and professionals that can find reasonable compromises to leverage this newfound flexibility will have an advantage in the new world of work.