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Some startups are aiming for permanent work from home for a majority of staff. (Photo: Ravindra Joshi/Mint)
Some startups are aiming for permanent work from home for a majority of staff. (Photo: Ravindra Joshi/Mint)

Firms gear up for extended WFH

Prolonging the work-from-home policy is a safety measure, helps reconfigure the workplace and cut costs, say analysts

Some Indian startups aim to have most of their employees work permanently from home, in the wake of tech giants Facebook, Google, and Twitter announcing such measures for their employees till 2021.

In India, edtech startup Unacademy has announced that 60% of its 1,000-strong workforce will work from home (WFH) permanently. “We are bringing some major changes to the way we work. Some teams such as sales, operations, and support will be working from home permanently," said Gaurav Munjal, chief executive and co-founder Unacademy.

Working from home has worked out well for firms, especially information technology (IT) and IT services. Around 90% of IT staff and 70-80% of business process outsourcing firms, as well as small and medium businesses, including e-commerce, have moved to work from home. This is unlikely to change much even after the lockdown is lifted.

“We have seen the work of some teams being very productive remotely and we have realized we will be able to scale faster and more efficiently this way," said Munjal. Unacademy, which is backed by General Atlantic, Facebook and Sequoia, has more than 1,000 educators who are working from home.

Google and Facebook said last week that most staff could continue working from home for the rest of the year. Several others such as Amazon and Twitter are also not in a hurry to have employees return to offices. “Opening offices will be our decision. When and if our staff come back, will be theirs," Jennifer Christie, Twitter’s head of human resources, said in a blog post.

Prolonging the work-from-home policy is not just a safety measure but a pragmatic approach to cut costs and reconfigure the workplace, said analysts.

Tata Consultancy Services Ltd said it expects 75% of its staff to permanently work from home by 2025, while 96% of the staff at HCL Technologies are in no hurry to return to office. “We are not in a hurry to get employees back to office. Their productivity has gone up by 16-20% in April, people are logging in for a longer period, our volumes have gone up and that is primarily because there has been no break in operations," said V.V. Apparao, chief human resources officer, HCL Tech.

Many Indian startups struggling with funding and cash flow problems are also exploring a permanent work-from-home model for a majority of their employees.

“About 25% of the startups have less than six months of runway. They will be in serious trouble if the recovery does not happen in six months. It does not look like happening within that period," said IT industry veteran Senapathy (Kris) Gopalakrishnan.

Many startups who did not want to be named said that they are exploring the feasibility of prolonging the work-from-home period to cut costs and keep employees safe.

Startups are also rethinking how they work. Teams working remotely will be expected to come to office 2-4 times in a month for meetings, discussions and reviews, said Munjal.

“Such a move in the long term is expected to help reduce the burden on the company’s fixed costs. This move is also a win for employees who don’t need to spend excruciating time on the road to travel to work and need not spend money on fuel and other expenses...Having said that, this will add tremendous stress to the commercial real estate market that has been a rather fruitful business for many," said Sanchit Vir Gogia, chief executive officer and chief analyst Greyhound Research.

Office rental costs are a huge expense and if employees choose to work from home it could positively impact the bottomlines of companies by releasing a huge amount being spent on office rent, operating, administration, and transport costs.

Many firms, especially in the services sector, will be prompted to evaluate a permanent work-from-home option. “There is no reason why it should not work in an Indian context, given the right measurement and oversight systems—a shift from ‘attendance’ to ‘output’ and outcome," said Prasanto K. Roy, a tech policy analyst.

HCL Tech is already looking at 50% of its employees working from home on a rotational basis for the next 12-18 months.

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