Company Grows, Shrinks Via Virtual Officing

Craig Thompson was just about to sign a year-long office lease for his new business, when he had an epiphany: With three partners and the expectation of hiring several new employees – all working by computer, was office space for his budding high-tech consulting firm really necessary?

After all, it would lead to a commute of up to an hour or more for Thompson and his Dallas-area partners, and would limit by geography their ability to recruit new employees. Most importantly, it would hike the operating expenses of Object Services and Consulting Inc. by upward of 30% year, Thompson recalls.

So Thompson backed out of the signing, huddled with his two partners, and decided create OBJS as a virtual corporation. This was in 1995. The company has operated “decentralized” ever since.

“The increase in overhead was significant enough that we really had to consider it,” says Thompson, president of the defense industry technology consulting firm. “We decided early on that we worked really well individually and decided to explore that path.”

Locating a small business can take several forms. Last week, we explored those growing home businesses that look to cut costs by subletting traditional office space. Yet, for those small businesses keen on growing but staying home based, virtual officing has become the norm. Remote technology like wireless laptops and handhelds, and powerful PCs and broadband access in the residential and non-traditional “out-of-office” settings, more than 34 million Americans occasionally work from home, according to research firm IDC. All together, 78 million Americans are considered remote workers, doing their tasks outside the corporate office.

Being virtual has allowed Thompson not only to boost productivity by eliminating any commute. It’s also allowed the company to recruit employees regardless of distance. Accordingly, the company rode the high-tech boom by bringing on 12 employees from throughout the Dallas area and as far as Minneapolis. While the company doesn’t require broadband service in an employee’s home office, most have it, Thompson admits. Additionally, the company reimburses employees and partners up to $325 per month for supplies, including computer equipment, software, phone and Internet service, and professional or association memberships.

To exchange thoughts, individuals email each other. To exchange data or deliver projects, they email with security certificates or log onto a central server at an ISP. Workers track their time as they go, and email standard weekly time reports to Thompson. He then gathers the data monthly for client reports.

The virtual office strategy has helped the company better survive economic lean times, Thompson admits. In 1995, the company opened virtually with three people. By 1997, the company had eight employees and a 30-hour-a-week administrative assistant spread throughout the U.S. At its peak, the company had 12 employees. If Thompson had to ramp up – and scale back – according to business growth, contracts would have to be renegotiated, more equipment leased or let go, and employee lives would have been affected as they were forced to relocate to find new work.

“There was no cost and no pain,” he says.

After eight years, Thompson has realized that virtual officing is more about running a small business than where that business is based.

“The bottom line was that in the kind of work that we do, very often we work with people who aren’t near us anyway,” says Thompson, who doesn’t worry that he can go months or even a year without seeing an employee. Daily email and weekly conversations often suffice, he adds. “If physical distance isn’t an issue, why would you require it?”

To learn more about OBJS’s virtual officing experience, visit http://www.objs.com/survey/vo.htm