When are Distributed Workforces Better than Co-Located Workforces?

Recently, I wrote a blog on when co-located teams and workforces are most important. Since I regularly work with teams that are disbursed, I began thinking about when it helps to have distributed workforces.

I was listening to a young professional discuss her years long experience with Zoom meetings recently. She remarked that the people on her team who worked outside of the main office had slowly become more visible during the COVID pandemic. With everyone reduced to small squares on a monitor, a certain equality had evolved – eliminating the togetherness that the home office team had felt when they saw everyone face-to-face daily. Is that good or bad?

There is little question that much of the business world operates in a global world. And I suspect that we will continue to offer some combination of distributed workforces and co-located groups in the future. The question becomes how to decide when to co-locate and when to distribute both teams and workforces. Clearly, most global companies need some workforces distributed across their areas of market reach.

In this blog, I’ll offer four situations when it may make more sense to use a distributed workforce, project, or product development team. First, a note about teams versus workforces. Workforces may function like teams, but larger workforces may not all be working on the same efforts. For what I’m discussing, it’s important to understand that the closer a team is working together on the same project, effort, or product line, the more important communication becomes. Only you can determine when it makes more sense to co-locate a group or distribute them.

Here are my four areas to consider:

1. Customer service teams

When software development teams need to support software that is used globally, it is more practical to have developers all over the globe, to better offer 24-hour service.

Yet, when Tony Hsieh started Zappos, he co-located his teams for quite some time. He found that building that spirit of fun into the workforce was critical to the values of Zappos. Am I the only person who has sensed a significant difference in the personality and effectiveness of the Zappos teams in recent years? I can’t speak to cause and effect, given Hsieh’s death and Amazon’s purchase of Zappos.

But people do need to sleep and most people are better off with sleep patterns that track their natural circadian rhythms. So, if you are selling your products globally, you may want to distribute some teams around the globe. That way you can offer better responsiveness and allow your employees a healthier lifestyle.

2. Size of the team

Robin Dunbar, a British anthropologist posited that the average person could not manage a group of social contacts of more than about 150. Clearly, there is room for debate on the number itself, as well as whether modern technology allows us to effectively manage a group that is larger than that. Put aside all the potential arguments over the value of Dunbar’s Rule of 150. Common sense tells us that office buildings that hold many thousands are not well-designed to foster group teamwork, camaraderie, creativity, and innovation. And is it necessary?

What is the purpose of co-locating a team of 2,500 people in one location? Is it an ego trip for the CEO to have the largest offices in the industry? OR is the organization truly producing greater value by having so many people together? I’m quite a fan of cross functional teams and bridging the silos to improve communications. But in large organizations, one must at least consider distributed workforces.

3. Sales market

If you are actively selling to a geographically distributed market (i.e., globally), it is more critical to have some teams located in your primary markets. Many companies sell their products or services on the internet, but they don’t cater to every geographic market. Which markets are you actively trying to tap? Consider co-located teams in those markets, while disbursing your larger workforce.

There are cultural differences that separate the various communities in our world, and the more your teams know about those local characteristics, the better they will be able to attract, service, and retain customers in those communities.

You might also want to consider whether you are selling a commodity item or a high-touch, very specialized item. When your products are on the high-touch, specialized end of the spectrum, it may become more important to use distributed workforces. There is no substitute for boots on the ground, so to speak.

4. Split teams

As companies grow and add new offices, projects, products, and sales markets, questions will evolve about how to best split up your teams and workforces. As I mentioned in my opening, people located in smaller disbursed locations or working from home can begin to feel like the ugly stepchild when the home office is large and quite well-bonded.

Consider using technology to level the playing field a bit. And pay more attention to the risk that those outside of the main location don’t feel quite as connected.

While I typically prefer face-to-face meetings, sometimes it’s just not feasible. Recognize that if you are holding in-person meetings but allowing others to conference in, it may feel a bit more equitable for everyone to simply be a square on the screen.

Are you facing some large questions on distributed workforces or co-location? I’d love to chat. I might learn something. And I’d love to see you join my newsletter list.