Approximately 40% of the American workforce will be freelancers, contractors, or temp workers by 2020.
According to Forrester’s US Telecommuting Forecast, 34 million Americans already work from home. When employers are already struggling to maintain employee engagement and retention in the physical workplace, how will they do it for their distributed team members?
The inability to engage employees in the workplace costs the U.S. Economy $370 billion a year. Why is this cost so high? Unengaged employees are more likely to leave their company for a new job, they are less productive, and they don’t produce quality work.
In the future of work, distributed employees will be more likely to leave for two reasons: (1) they are not beholden to a geographic job market and can instead work from anywhere, and (2) employers will be competing to improve the benefits of remote work as freelancing becomes more enticing (making it more likely that your worker will leave for another company). How should employers be preparing for tomorrow?
Develop Talent and Give Autonomy to Workers
There is a talent shortage in America. Half of the hiring managers considered recent college graduates unprepared for the workplace. More than ever, there will be fierce competition to secure talent. How do you secure talent?
Give people autonomy over their life. 91% of American remote workers feel that they are more productive at home than when they are in the office. This is further proven by the co-founders of Chinese travel site CTrip. By allowing some of their employees to work out of office, they found that remote workers ended up making 13.5% more calls than their in-office counterparts.
Consider developing a common work area and hiring freelancers near you. It is easy for freelancers to feel excluded from the team. Remote workers can be thousands of miles away, they don’t see co-workers in person, and they can feel like temporary workers who are not valued. To remedy this, consider hiring freelancers near your company. Build a common space to give remote workers a place to work within company walls. As a result, you can get freelancers in project-related meetings, brainstorming sessions, and invested in helping the team.
Let Go of the Bell Curve Myth and Look For Hyper Performers
Does employee performance fall under normal distribution? (image source)
In business, there is a common belief that employee performance should fall under the Bell Curve (otherwise known as normal distribution). Because of this, many business policies employ this method when it comes to performance reviews, compensation increases, and even training courses. But the Bell Curve is a myth, here’s why:
In 2011 and 2012, Earnest O’Boyle Jr. and Herman Aguinis conducted research into the bell curve. From more than 633,263 people, from researchers, politicians, athletes, and more — it was found that 94 percent of the groups did not follow a normal distribution, but rather, follow the “Power Law” distribution which is illustrated below.
There can be more high performers (image source)
This is why the Bell Curve doesn’t work:
- Normal distribution relegates the number of high performers to no more than 10%. When companies judge their employees on a five-point scale, even relatively high performers are forced into the average.
- Even if your team is ALL high performers, 10% of them are relegated to a group of “losers”.
- Most of the money goes to the average because most of the people fall into the average, instead of compensating employees based on effort and performance (which can lead to resentment).
When judging remote employee performance, employees are not going to be as receptive to low-performance reviews because of faulty distribution models. Value your high performers and in return, you will see more loyalty. Otherwise, you will be unevenly distributing compensation. Companies have to come to terms with this fact: some people really do drive far more value than others. So instead of creating performance reviews based on distribution models, focus on developing talent and valuing all high performers.
Conclusion: Bring Employees Together Towards the Bigger Picture
People become freelancers for three reasons: (1) they are passionate about what they do, (2) they want to work with like-minded individuals, and (3) they want autonomy over their personal life. Because of their passion, they want to see their work help companies reach their goals. This is also true for remote workers who aren’t in the office to visually see the effects of their work.
That’s why it is more important than ever to get employees connected. One of the first steps is to implement a social enterprise tool. This way, you can regularly communicate to your remote team and in-office team in unison. 69% of employees said they would work harder if they were better appreciated, according to Globoforce. Your company’s interactive Intranet or enterprise social network is the perfect place to keep your distributed team updated and cared for.