By Matt Andersen, CPA, Founder, MD Andersen CPA PA
Our latest blog series for Lifestyle Entrepreneurs, we are reviewing the common traits of businesses that balance growth with flexibility and a higher quality of life. One of the increasingly common strategies is to forgo a traditional office and become location independent, working either entirely remotely or out of a coworking space. With so many technological advancements and online business models to choose from, it seems like a no-brainer. No expensive rent. No utility bills. No maintenance. No problems?
It depends, but almost every business can and likely should reconsider how remote work aligns with their overall goals.
For years, business owners began offering work-from-home options to better accommodate the lifestyle needs of their employees. It was typically an arrangement that was limited in scope and only offered to those who had no other option but to work some or all hours from home. It also became a more desirable option for individuals who wanted a day or two at home, free from the pressures of commuting to work.
In 2020, remote work was no longer an option, but a necessity for anyone able to conduct business primarily from a computer. In what has become a fascinating social experiment, we are able to get a more clear picture of the consequences of location independence and how it impacts our growth prospects now and in the future. The verdict? It wasn’t for everyone.
While working from home still has it’s usual perks (hello, jammies all day), many entrepreneurs have struggled to keep the lines of communication open, manage their team, and strengthen client and customer relationships. Whether your business is primarily conducted on a computer or not, there is simply no substitute for in-person, human connection. Conversely, parents working from home have probably experienced too much human connection – from their children. Time with family is great, but time with family during several weeks of a mandatory quarantine made many parents desperate to spend a day or two at the office. This begs the question: has this experiment proven we aren’t ready to give up the keys to our offices?
Perhaps, but if you aspire to run a business that prioritizes the lifestyle needs of yourself and your employees, you may not want to give up on the idea just yet.
Some of the negative consequences we have experienced from remote work have a lot to do with our general inexperience conducting business virtually. Remember those first Zoom calls you tried to conduct? Chances are they weren’t pretty, and it probably took 5 times longer than it probably should have. To make matters worse, we had no idea what alternatives we had to Zoom or how they worked. The same is true for many applications used in remote work environments. Our learning curve is still high and the technology is still catching up to our work-from-home needs, particularly in the small business market.
Entrepreneurs, specifically, owner-operators, must also recognize how their leadership styles impact their ability to be location independent. If you are a big-picture thinker who has a talent for motivating others, a remote office will be a challenge. Generally speaking, managers find more success in a remote work environment when they have strong project management skills and keep their teams well organized and informed. If you rely on open conversation and informal small talk to keep initiatives moving forward, you may need to hire someone to help structure your workday and manage your overflowing email inbox. Interpersonal skills are still incredibly valuable, but you will need to find strategies to get things done in person and on a screen.
Even business models not suited to location independence can incorporate some elements of remote work. If you own a local brick-and-mortar style business, you won’t want to give up your unique physical address. That alone provides valuable information and marketing benefits when people are searching for similar businesses on Google and GPS applications. Other businesses are just as well operating from a permanent address rented from a coworking office. However, it is important to distinguish between when you are physically needed on location, and when you can accomplish just as much, if not more, by conducting business remotely.
Every business needs to find its own balance, and these days, there are more options than ever to incorporate elements of location independence. You can start with learning more about online productivity applications like Slack or Microsoft Teams, or simply commit to allowing yourself and your employees at least one to two days a week to work from home. If COVID-19 has taught us anything, we have learned location independence is a process and not something most businesses can instantly achieve. You may not be ready to give up your keys, but don’t give up on the experiment if you want to be a Lifestyle Entrepreneur.
Matt Andersen, CPA loves analyzing data, people, and businesses. He is passionate about helping entrepreneurial-minded clients achieve their goals, keep more money in their pockets, and live a higher quality of life. In addition to tax and accounting services, Matt provides one-on-one coaching for various topics including lifestyle entrepreneurship, advanced tax planning, and new business creation.