Buying and Selling: Does Distance Matter in the Modern Workplace?

The world of remote and hybrid work has become the norm, but that doesn’t mean we have successfully navigated its challenges just yet.

In the age of constant real-time communication, Assistant Professor Jasmina Chauvin (SFS’05) is curious about the role distance and location plays in a firm’s performance. Chauvin, a graduate of Georgetown’s Walsh School of Foreign Service, worked in infrastructure and energy finance, as well as international development, before returning to academia. She teaches core courses in strategic management and the structure of global industries at Georgetown McDonough.

Chauvin’s research focuses on firm performance and growth — how firms decide where to locate different parts of their organization, how resources are allocated within the firm, and the effects of transportation and communication costs on firm performance in the United States, as well as emerging markets. Her research also explores a broader question: does the geographic distribution of various firm operations impact business efficiency — and why?

Here, Chauvin discusses the recent shift to remote work and how firms should consider the dimension of distance between their employees.

BUYING: Distance Matters and Challenges Should Be Considered

As internet communication has experienced exponential growth over the past two decades, some employers and employees alike have bought into the idea that “distance is dead.” As a result, employees are more likely to work with teams that are geographically separated. Even in the age of digital communication, though, distance does matter when it comes to business efficiency and effectiveness. It can be a challenge to manage a firm that’s distributed across multiple locations — whether it be globally, multinationally, or even in various cities in the same country. In today’s modern and globalized workplace, time zone differences are more frequent than they used to be. When employees are based in different time zones, it can create friction for real-time, synchronous communication, such as Zoom meetings. Firms and their employees, however, can overcome this hurdle by time shifting. For instance, an employee working for a London-based company in the United States can adjust their work day to fit standard business hours in London.

SELLING: The Belief that Distance Doesn’t Matter

Following the COVID-19 pandemic, fully-remote and hybrid work became the norm for many companies — with it, the idea that employees can live anywhere in the world and workflow is not interrupted. As a result, companies have become more global than ever before. While some employees may prefer a non-linear work day and can easily time shift, it’s not a one-size fits-all solution for every job and duty. For roles that require brainstorming, problem-solving, and creative thinking, synchronous communication with colleagues is essential. On the other hand, employees who perform more routine tasks that don’t involve collaboration, such as data entry, time shifting may be easier because that type of work can be easily done asynchronously. There are trade-offs to time shifting as well. For instance, employees may end up working around the clock, which can lead to burnout and dissatisfaction. Furthermore, working early morning and late evening hours can be costly for employees.

This story was originally featured in the Georgetown Business Fall 2024 Magazine. Download the Georgetown Business Audio app to listen to the stories and other bonus content.