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Introduction
Due to their scale and work in several countries at once, international business organizations must comply with many standards and laws than local companies. With the organizations growth, the scope of its responsibility increases; with the growth of income, opportunities increase, generating free resources. These resources are usually invested in the companys further development: marketing, capturing new markets, product diversification, and more (Kabwe & Okorie, 2019). With the development of technology, many business processes are significantly accelerated and automated, increasing the pace of development of companies and, accordingly, competition. As a result, international companies become more exposed to external global factors. The strongest in the market is the best to adapt to new conditions. As part of the economic crisis and pandemic, this is precisely the situation that has led to many changes in the established business processes of many organizations.
The COVID-19 pandemic has forced many global companies to experiment with remote work on a scale like never before. While teleworking at multinational companies is not a new work model, most business firms have closed their offices indefinitely, instructing employees to work from home to contain the spread of the virus. At first, many international companies hoped to return to everyday life in a couple of months, but years later, millions of workers are still working remotely (Espitia et al., 2021). This trend has its obvious advantages: the selection of candidates for various vacancies is extrapolated to the international labor market, and there is no physical contact among employees, which is undesirable in a pandemic. Technological advances in software and hardware have made it possible to reduce the impact of switching to this mode of work for those who usually work full-time. Many video conferencing programs, interactive systems for interacting with a large group of human employees, and Internet traffic control programs such as Zoom, Timely, and CleverControl began to develop thanks to the transition to remote work actively (Pratama et al., 2020). On the other hand, the possibility of interacting with customers directly, creating a working atmosphere, and the possibility of control by management are falling.
This workforce shift has increased the need for remote leaders to manage the organizations goals and objectives. Organizational leadership has been the backbone and key to the success of firms in solving company problems and problems. Leaders of all sizes and positions are faced with the extraordinary task of managing employees remotely. Such a task still had to meet the requirements of social responsibility, the companys mission, goals, and vision. The ability to adapt and mobility became critical for employees and managers, who had to maintain the efficiency of the companys operations in the new conditions and adjust to the crisis. Experts in dealing with uncertainty and lack of sufficient information to make decisions have become highly valued (Hong et al., 2018). Thus, the influence of remote leaders and their popularity is an important area that requires research related to the effects of the pandemic and other external factors that contribute to the transition of employees of a business organization to a remote work mode.
This paper contains a literary review of aspects of remote leadership, the main types, the implementation of these styles, and theoretical justification. This section is followed by the research methodology section, which contains the concepts considered in the study and the primary methods for their quantitative assessment. They include collecting information from open official sources, such as annual reports of companies, on the dynamics of financial performance in recent years. The study was conducted using questionnaires of leaders from different business areas. Then, a regression analysis will be performed to find correlations between the number of remote employees, organizational structure and leadership style, and various financial indicators of the liquidity and relevance of the company based on both surveys and other available information. The description is followed by a section on results and their interpretation, detailing all outputs and possible predictions and limitations.
Literature Review
This section deals with the main aspects of remote work and leadership in general, especially in its implementation in this mode. The literature review turns into a retrospective of remote work and its development on an international scale. In addition, the central leadership styles are considered through the prism of their adaptation to the new working environment. The theoretical models used in this study to describe the processes are also included in this section.
Background and History
Over time, the development of technology has given rise to the possibility of remote communication. Within this opportunity, organizations saw remote workers as an opportunity, not a constraint (Hunter, 2019). In this regard, business processes have been gradually optimized, within which the physical presence of a person is no longer needed to share or convey information. Accordingly, the organizations structure is also being transformed, becoming less hierarchical and more autonomous in each sector. At the same time, the consistency and messaging pace across sectors are increasing, which is critical within an international organization: information technology capital directly affects labor productivity (Arvanitis & Loukis, 2009). In this case, the leaders task is to control the execution of the companys operations within the organizational structure in the context of changing the way information is communicated between its levels. If the basic rules and roles of employees in the organization remain the same, responsibility can be transformed under a changing work environment, requiring specific skills from them.
For many large companies, employees themselves are one of the most important values. Apple and IBM, for example, offer ongoing learning and a welcoming environment built on inclusion and diversity (Apple, 2022; IBM, 2021). Showing care, attention, and appropriate attitude on the part of management requires appropriate competencies in the soft skills of a leader, such as teamworking, motivation, and conflict resolution. Managers in the workplace can influence the interlocutor with the help of non-verbal signs and interaction in the physical environment, among which moments of informal communication are possible. The remote leader, in turn, must be able to adapt these support mechanisms to the new environment without the possibility of physical contact, that is, only through the available means and communication channels (Vijaykar & Karhade, 2021; Kaveri & Mohan, 2020). If these processes are progressive and the company automates and introduces solutions requiring remote mode, employees have time to adapt to the new conditions. The case of the pandemic is fundamentally different precisely in this aspect many companies were not ready for such drastic changes, as well as leaders and employees, respectively. The complexity of adaptation was that it was necessary to master new tools across the company for functions that did not require any tools in a physical office: communication, team discussion, and physical document management. Although international companies already had an experience of remote collaboration, the transition of offices to this mode from the very beginning significantly increased the time spent on such moments, not to mention the psychological aspects of adaptation.
The office provided access to hardware and software, certain archival records, and an established interaction system between employees. Each employee has a habit that everything they need is at hand. The sudden transition to remote work requires managers to consolidate all these mechanisms and make them available to employees in the new environment (Contreras et al., 2020; Kaveri & Mohan, 2020). At the same time, organizations often provide all the necessary technical equipment, including covering the associated costs of an employee for arranging a workplace, by the remote work policy and other labor standards, including, for example, the General Data Protection Regulation (Lueck, 2021). Now leaders must manage the organizations resources within the framework of operations and provide support to employees at various levels, right down to the personal level.
Personal capabilities are now becoming a problem for the entire organization: if employees do not have access to the Internet, their laptop or smartphone with the necessary functions, and expensive software, the organization must provide the employee with all the necessary resources. For example, IBM has gone from adapting employees in the workplace to implementing a hybrid approach in operations. At first, the company viewed the cost of supporting employees at home as temporary, but now it is seriously considering abandoning many offices (Ford & Chang, 2021). The capabilities of employees in both modes are fixed at the level of policies of international companies: in-home offices, where there are no control systems, the time or amount of work of an employee is strictly regulated (Ford & Chang, 2021). With adaptation, the measures could be softened, forming the companys current policy, which itself is already striving for this regime.
Some companies were able to quickly and effectively adapt to new conditions. McDonalds has implemented a flexible leadership system to quickly respond to local groups, almost instantly implementing all kinds of requirements for operating offices and own establishments (Edeh et al., 2021). However, the individual characteristics of organizations created their own pace of transition. For example, IT companies such as IBM had the leading layer of their operations in a virtual environment, which only required the creation of working conditions and control for employees and the adaptation of key business processes, such as closing deals and interactions between management and employees (Ford & Chang, 2021). Companies from areas where complete headquarters relocation is not possible, such as the hotel business, were forced to differentiate this transition for specific departments while creating a safe environment for offline employees (Pham et al., 2022). In addition to the apparent differences in business industries, representatives of strict hierarchical organizational structures adapted differently from more autonomous ones. Written assurances of document flow in strict non-governmental organizations required streamlining and significant revision of the process (Chai & Freeman, 2018). At the same time, the absence of the need for such moments in more autonomous structures ensured a smoother transition to remote work.
Effective Organizational Strategies
Effective organizational strategies have a complex structure, as the leader must ensure all aspects of the transition to a remote mode and consider psychological and, in some cases, even personal factors. Although leaders have fewer opportunities for informal communication and personal assistance to employees, they can change the form of support in the form of remote access tools: instant messengers, video conferencing, and more (Golden & Gajendran, 2019). The interactive impact can now come in the form of encouraging emails and the provision of benefits in the form of paid counseling if the transition is difficult. Companies began to turn to the outsourced services of psychiatrists more often, and psychiatrists, in turn, began to use the possibilities of telemedicine more than 40 times (APA, 2021). Large organizations began to document policies to help employees work remotely, regulating opportunities not only to receive mental health services but also to give memberships to the gym, choose the time for an employees religious activities, and much more (Miller, 2019). Physical activity, time off, and the possibility of informal virtual communication with the leader can indeed be considered aspects of an effective strategy, the most recent research confirms an increase in the frequency of contact between employees among themselves, which has led to an increase in productivity in several cases (Yang et al., 2022). Regardless of the companys operations, leadership style, and structure chosen, mental aspects are the key to the effectiveness of the strategy chosen by the remote leader.
In a short time, most of the strategies for improving efficiency, and planning, such as Kanban boards, Agile, and many others, have become available for most companies to use analogs on computers and smartphones remotely. With the help of these applications, managers were able to delegate tasks to employees in a new but rather convenient form, and employees received a visualization of their activities (Cong, 2021). Studies have shown that technical issues arise almost as often as communication and management issues, while technology is the primary driver of remote work (Ferreira et al., 2021). The small organization of people implies constant contact since the management now has no physical access to the employee. Practical strategy skills now include management competencies within communication applications such as Skype or Zoom and applications that provide remote access, electronic document management, and interactive interaction within operational activities.
Regardless of their ultimate goals and dynamics, organizational strategies experienced a change in the form of their principal activity as part of the transition to a remote mode. If the company was aimed at capturing a particular market share, then, for example, now meetings with potential customers have moved online, the possibility of concluding contracts has also become necessary, and it has become necessary to find an aggregator to organize the logistics of supplying goods under new restrictions (Oxelheim & Randøy, 2021). If we rely on the three components of the content of the organizations strategy: communication, intention, and implementation only the intention has not changed its form. Intention sets goals, and the majority of companies, if they have not faced a severe crisis or a complete shutdown of their activities under the restrictions imposed, are still focused on increasing net and gross profits and expanding. Companies suffered losses, but approximately 10% were able to find resources to financially support their employees to maintain productivity and implementation (Pokojski et al., 2022). The dynamics of change in communication have been described above.
Finally, companies must meet social responsibility requirements along with environmental responsibility (Yang et al., 2021). As a rule, it implies the values of recognition of diversity, inclusiveness, and high professional ethics (Latapí Agudelo et al., 2019). Stakeholder pressure during a crisis can significantly reduce employee performance: studies have shown that adapting corporate ethics to a new virtual environment reduces the likelihood of conflict situations (Mehmood et al., 2020). The remote mode of work makes it possible to get jobs more often for women who have to stay at home with children and people with disabilities who would find it difficult to get to the office physically. Considering the tendencies to protect the rights of people subjected to various kinds of structural discrimination, remote work is a new normal toward which a civilized society was moving. Along with this, creating employees rhythm of work, improving time management skills, and the ability to manage resources are other significant advantages that have begun to be noticeably developed among employees. Such skills make life easier for the manager since employees are given more responsibility for their operations without the need for control.
Qualities and Roles of Remote Leaders
The goal of remote leaders is to help the organization identify the most important goals and develop the best ways to achieve them. Leading an invisible team requires someone who can understand complex conditions and objectively examine problems rationally and impartially before making decisions (Wang et al., 2020). Another essential quality of remote leaders is effective communication and strategic planning for more efficient and profitable systems (Spagnoli et al., 2020). When working from home, leaders tend to be more involved in the work that becomes part of their personal lives: the schedule becomes irregular. Suppose leaders are effectively fulfilling their responsibilities in this mode. In that case, the positive aspects of this experience should be adapted to the operational activities of employees, primarily by encouraging the transition to remote work. However, according to research, about 30% of workers cannot work from home due to various subjective reasons (Bloom, 2020). At the same time, large companies such as IBM, after the experience of the pandemic, are considering hybrid and completely remote options as a different vector for the companys development (Ford & Chang, 2021). Except in the extreme of not being able to work from home, leaders must, like the foundations of transformational leadership, lead by example in adapting work processes to their personal lives.
For many business sectors, such as the entertainment industry, hospitality, and tourism, the restrictions imposed almost wholly stop the ability to operate. These industries cannot function remotely, just like, for example, IT, marketing, or education. Accordingly, there are other organizations where the remote mode causes minor damage but forces not only to restructure the form of activity but to cope with a crisis. Organizations adjust to numerous legislative decisions in their geographic region, and in many cases, these decisions are large-scale and require rapid response in reforming operations in the marketplace. The most stringent restrictions on strict social distancing, gatherings of no more than four people in South Korea are not comparable to the relatively low ones in Mexico, where only wearing masks in public places is required (Han et al., 2020). On the one hand, companies working remotely do not need to adapt the physical office to government requirements, and employees do not need to contact other people during the journey to the office. On the other hand, leaders have less control over the movement of employees, which can violate restrictions on working hours, putting the companys reputation at risk.
The ongoing digital transformation process, which affects both the necessary competencies of a leader and entire business development strategies. Numerous studies show that technology has always been the driving force behind innovation, as evidenced by empirical evidence from the chemical industry to IT (Ahuja & Morris Lampert, 2001). Progressive changes are associated with the digitalization of commerce, marketing, purchases, and much more. As interviews with e-retail leaders have shown, this transition creates a risk transformation, understanding scarcity, and company size in a new environment that requires adaptation (Johnson, 2010). Any technological opportunity always requires costs and risks at first, but the most effective implementation later becomes necessary to maintain competitiveness (Bilan et al., 2020). Offices controlled by directors in international companies represent a similar model in the transition to remote work; the difference is that each employee now has his workspace, to which the manager does not have physical access. Digital transformation has made such a regime possible in principle, thanks to remote communication, the creation of shared networks, e-commerce, and many other technological processes.
Remote work has allowed employees to better balance work and family. Many have begun to save money and time on the road, sleep better and work much better in a comfortable, stress-free environment. The balance between personal life and work is one of the critical factors in employee satisfaction. A study of banking employees has shown that remote work, in contrast to being physically present, has a more significant impact on work-life balance, which is primarily positive (Putra et al., 2020). In contrast to the physical mode, remote leaders will deal with this aspect more often, which slightly distinguishes their competencies from classical leadership. Research in this area also shows that traditional leaders are better at increasing the effectiveness of remote workers over time by creating an appropriate culture that includes behavioral and communication strategies for interaction (Basile & Beauregard, 2016). Figure 1 shows the dynamics of employee satisfaction in this study over time.
Remote Leadership Styles
Leadership is categorized into different styles that have distinctive qualities. According to research, if the pace of current telecommuting trends continues, more than 30 million Americans will be working remotely by 2025 (Brynjolfsson et al., 2020). The most common leadership styles are transformational, participative, situational, laissez-faire, servant, and adaptive. The context of the remote mode changes the form, methods of achieving goals, and control mechanisms in each of the above styles. The common thread among them is that telecommuting leads to a forced transition to autonomy, which can lead to improved productivity and well-being of employees and cause conflict and chaos. The task of management, in this case, is to increase the positive impact of such an irreversible transition and reduce the negative one.
Laissez-faire or non-intervention is the leadership style, the hallmarks of which were forced to appear remotely. Leaders who have a participatory style are deprived of the opportunity to be personally present during operations. Except in the case of constant monitoring via video or similar applications, many leaders are forced to move to a hands-off approach for two reasons. First, employees need to adapt to working from home, where all kinds of control systems can be negatively perceived as an attempt to encroach on personal space. According to research, these attempts are stressors that, according to research, under a laissez-faire policy, become the causes of conflict and destructive behavior of employees, leading to the decay of the social atmosphere and a drop in productivity (Skogstad et al., 2007). Secondly, the employee can give instant feedback without constant physical monitoring of the presence in the workplace.
There is a theory that autonomy, which gives employees independence, contributes to the disclosure of the creative potential of people. This theory is supported by studies that show a connection between the implicit autonomy motive and creative production both from school age and in an older sample, where the relationship between the leader and employees is also essential (Baum & Baumann, 2019; Volmer et al., 2012). Paradoxically, the more the leader communicates with employees, the more they demonstrate creativity and creativity with the autonomy granted (Volmer et al., 2012). Within the framework of this autonomy, the leaders main task is to create conditions for open, ethical communication, both voice and text. The social environment should encourage innovation since the virtual environment itself is, in a certain sense, a forced but innovative solution for many people and organizations.
Participative leadership in reflecting the remote work mode implies many group activities: videoconferencing, sharing interactive use of working software. Like servant leadership, the manager is constantly in touch with employees to control the process and help its participants. A similar approach is used for transformational leadership, but the goal of this style is a positive change. In all three cases, the leaders set an example, which has a positive relationship with employee performance and engagement instead of styles based on transactional leadership (Limsila & Ogunlana, 2008). Consequently, the leader must have the skills to confidently use the software and help employees adapt to the use. If the work involves a constant presence at the workplace, the leader should also be with his team, if possible, without absences.
An important psychological aspect of the servant leadership approach is vital to apply regardless of the chosen style. Many employees have experienced adaptation problems, burnout, and the inability to concentrate at home, as they needed psychological support against the background of the imposed restrictions many lost their jobs, experienced the consequences of lockdowns, and the inability to see relatives, and friends, and much more. This information, as a rule, was obtained by remote surveys through specially compiled scales of stress and burnout (Hayes et al., 2020). This phenomenon has been referred to as professional and social isolation, which reduces employees productivity for various reasons when staying at home for a long time. For example, research has shown that lockdown can lead to reduced sleep quality, anxiety, and feelings of loneliness. Research findings are similar for teleworking compared to much earlier in a pandemic context (Mann & Holdsworth, 2003; Xiao et al., 2020). The servant-leader always supports his employees emotionally, inspiring them to mutual respect and putting the employees well-being over the clients satisfaction (Canavesi & Minelli, 2021). In the face of brutal layoffs, mass layoffs, and financial constraints, this type of long-term leadership in remote work has proven the best adaptive.
Adaptive leadership offers the most flexible self-awareness of both the leader himself and all employees of the organization. This style sets adaptive tasks for the company, each of which does not have a single correct and obvious solution. The conditions of uncertainty that characterize the pandemic experience imply the need for constant adaptation. For example, the restaurant business that was able to adapt and quickly connect to food delivery aggregators and create the possibility of online orders could save a certain percentage of revenue and closure (Serbulova et al., 2020). In addition, according to empirical studies, this style is primarily consistent with the non-financial sustainability of the business, which in turn contributes to financial success (Akhtar et al., 2016). The role of a leader in such an approach varies from task to task and, depending on talents and competencies, can be ranked among all leadership styles.
Moreover, a new kind of collaborative leadership has emerged during the era of telecommuting. This phenomenon was born from the spread of autonomy, the consolidation of virtual teams, and the distribution of responsibilities and shared responsibility for the result (Pavez & Neves, 2021). Within the framework of this approach, the involvement of employees is significantly increased, while the figure of the leader itself is not excluded but may be formal. A survey through surveys showed that when using collaborative leadership tools, in addition to involvement, the power and responsibility of each employee increases, and psychological factors become essential. When conflicts arise, as a rule, the leader in this situation has less power and, accordingly, the means to resolve it; in a virtual environment, the situation becomes more complicated (Kramer & Crespy, 2011). The virtual environment often involves asynchronous communication, which, by definition, is less efficient and controllable between the leader and the employee.
Concept of a Remote Leadership
The resulting model, taking into account the specifics of some business sectors, will show the effectiveness of various leadership styles and the dependence of the number of remote workers on the companys financial performance. According to the studies, the success and sustainable development of the company does not only depend on the positive dynamics of specific financial indicators but also depends on compliance with the requirements of social and environmental responsibility, the presence of corporate ethics, charity events, and other events that form the image and position of the company (Maden et al., 2012; Waler & Dyck, 2014). Reputation is the degree of stakeholder evaluation based on profitability and intangible assets such as CSR, but the degree of influence is subjective. There are essential behaviors of remote leaders that have a qualitative impact on the success of an organization. These behavioral roles affect the relationship between employees and their supervisors, as do influence the psychological state of each other in a virtual environment (Mann, S., & Holdsworth, 2003; Xiao et al., 2020). They act as intermediaries and mentors between the management team and remote workers. Human relations and goal achievement roles are essential to success in global organizations for remote executives.
Theoretical Framework
There are several theories, the practical application of which would be necessary for remote mode; however, in this paper, the model of George Homans is used. The model includes three main elements: tasks, interactions, and attitudes. From the manager, employees receive tasks, perform them, and establish interaction, which is likes, dislikes, feelings, and attitudes. The more frequent the interactions, the stronger the attitudes, and vice versa (Treviqo & Tilly, 2015). The longer the interaction, the more identical the attitudes and the more similar the employees. They have standard norms and what they value together. Norms are fulfilled the better, the more cohesive the community is. Norms can be better enforced than formal rules. Violators may be subject to informal sanctions.
The more people interact with each other, the more positively they can relate to each other. The reverse is also true: the more positive the relationship, the more intense the interactions. However, having set the initial conditions for the groups existence, the external system influences what is happening in the group to an even lesser extent since what J. Homans called the internal system appears, which includes group norms, ways of interaction, and joint activity. However, the external and internal systems are in a specific interaction (Treviqo & Tilly, 2015). Change in technology leads to changes within the group, and new ways of working together can then be turned into technology.
First of all, this model focuses on the aspect of forming a team or group, taking into account three critical dimensions physical, cultural, and technological. All these aspects are somehow important in the conditions of remote interaction. Management mechanisms of management also lie in three planes. Using the terms of the model, the leader can give tasks and provide interactions within which attitudes are formed. In addition, this model has previously been used only to address issues of distribution of power and building ethics in the company (Chen & Choi, 2005). Although these factors are also aspects of leadership, the current processes are complex and multifaceted.
This model will make it possible to form a questionnaire for leaders better, providing work within the same terminology, which considers an activitys technological and psychological aspects. Technology in the model acts as a mechanism for forming new attitudes and norms, while the technological factors of the virtual external environment affect the categories of interaction between employees and management. Through the prism of this theory, it is possible to observe how the specific practical implementations identified in the surveys will affect the group effectiveness and interaction of
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