Working from Home: Should Your Small Business Still Have an Office?

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Last Updated September 1, 2023


If there’s anything good that’s come out of the coronavirus pandemic, is the realization by millions of small businesses that working from home works. Assuming the business equipped with the right technology and cloud-based systems, employees of most businesses can successfully work as if they were in their offices.

This experience has caused many to re-think their entire workplace model. Big companies like Twitter, Facebook and Microsoft have already announced their intentions to allow their employees to continue working from home, in some cases indefinitely.  All of this raises a big question: is the office really necessary anymore? Should small businesses still have an office?

The answer isn’t easy, but it’s yes. You do still need an office. But maybe not the same kind of office you used to have.

Why it worked when I closed my office and told employees to work from home

Of course, for some companies, the question is irrelevant. These companies must have a place of work. They manufacture or assemble products, sell items in a store, serve diners in a restaurant or generally need a place to warehouse stuff or simply operate the kind of business where it’s traditionally expected that clients and customers can visit (i.e. a law firm or fitness center). But then again, you might be like my company. My ten-person firm provides technology consulting services. I haven’t had an office for more than 15 years.

I used to have an office near Philadelphia, complete with a coffeemaker, a litter box (for my cat, OK?), cubicles and a waiting room. I paid rent and utilities and commuted there every day. Except there was one problem: no one came. My people were usually out at jobs or working from home. My clients had no reason to visit me. In fact, if I wanted to see my clients, it was preferable that I went out to them. So, each day, I’d sit in this lonely office with no one, save my cat, to speak to. The good news is that there were no mice. But it was kind of depressing. And a waste of money.

So, I closed the office. I opened a post office box instead, which to this day still serves as my company’s address. I instructed everyone to keep doing what they were doing. At first, we were synchronizing data, and that was a mess. But ultimately, we moved everything, including our QuickBooks database, to the cloud. We have a cloud-based phone system. We rely heavily on cloud-based tools. We’ve been doing the whole work-from-home thing since long before it became the thing to do.  The cost benefits of all this have been enormous. I had no more office expenses. I didn’t have to buy computers and servers. Since then I’ve been through two significant downturns and because my overhead has been so low, I’ve managed to be more flexible.

The downsides of working from home and losing face-to-face collaboration

But there’s been one big downside to all this: collaboration, or the lack of.

I like to joke that I run the world’s most dysfunctional company. But I’m not completely kidding. Sure, I regularly speak to my employees and contractors by phone and over video. I oftentimes run into them at client sites. But we never get together as a group, except maybe for the holidays (and even then, it’s kind of awkward). People don’t really know each other that well. There’s no company culture.  There’s no running into people or hanging around with each other or chilling out in our cubicles or the breakroom. We don’t have a softball team, or Friday pizza days.

As a result, there’s much less camaraderie and less of a family feeling.  More concerningly, we have little opportunity for innovation. There’s no exchange of ideas. There’s no collaboration about current or even potential projects. Things don’t come up organically. I don’t have that, and I think the lack of human interaction in my company hurts my prospects. I think I miss opportunities and ways to be serve our clients. This is why many larger companies, from IBM to Yahoo, have in recent years cancelled work- from-home policies and required that employees come into the office.

You probably need an office but not one your employees use every day

Does your small business need an office? Probably. But it may not have to be the same office you’ve always had. You’ve seen that the cloud is effective and that people can work from home. You should expand this practice and give your people the flexibility to work from anywhere.

But I also think you should—if it makes sense—continue to maintain an office space (albeit a smaller one) and have your people to come in maybe once or twice a week. I think if you balance working from home with some face-to-face time, even if those faces are covered for the time being in masks, you might achieve the best of both worlds. You’ll certainly be less dysfunctional than my company; that’s for sure!

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