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Distributed Teams vs Remote Teams: The Difference and Their Modalities

Employees love flexibility regarding their work locations. A study by Scikey revealed that an astonishing 82% of employees don’t prefer working in an office.
Plus, in a post-pandemic world, employers are also looking for sustainable alternatives that will help them reduce operational costs and not force them to go into unfair competition with larger organizations, yet the quality wouldn’t be compromised when it comes to deliverables.

Therefore, as a result of the employee and employer demands, two different modalities of work – remote teams and distributed teams – have seen a rise in popularity throughout the world.

While many use these two terms interchangeably, they are not the same. Yes, remote teams and distributed teams are similar in their core essence, but their working modalities are very different.

In this article, we will delve deep into the differences between remote teams and distributed teams and their advantages and disadvantages to understand both work modalities better.

Distributed Teams vs Remote Teams: Are They the Same?

Distributed Teams

An article by McKinsey outlines attracting and retaining top talents as the number one challenge for an organization. However, businesses these days have managed to overcome this issue by hiring distributed teams. But exactly what kind of teams are defined as distributed teams?

The term “distributed” refers to shared or spread out. Distributed teams refer to a team of employees who are spread out as far as even another country or continent.  All the team members work from different physical locations.

However, distributed teams can come in many forms. For example, your headquarters is in the Netherlands. But your tech team is working from Bangladesh, your Graphics team is working from Ukraine. They can work from the comforts of their homes in those countries or they can share a coworking space in those countries – they will be called your distributed teams regardless. 

Remote Teams

The core idea of remote teams is very similar to distributed teams. Remote workers too work from different physical locations.

However, unlike distributed teams, usually remote teams have a central office or a location where all or a few employees go and work part-time or full-time. Organizations can set up remote teams in different ways for operations such as sales operations hubs and call centers. 

Some examples of different modalities of remote teams: 

    • Most members work on-site and others work from their homes or other locations.
    • Most employees work from their homes or other locations, while only a few employees work on-site.
    • Employees can work part-time or full-time from off-site locations.

The modalities mentioned above are only a few examples of how remote teams work. The main gist of remote teams is flexibility in terms of work location while working at the same company under the same manager.  

Remote Teams vs Distributed Teams

As mentioned earlier, remote teams and distributed teams are similar in many ways. However, a remote team means the members of the team simply works from different location including an on-site central office.

On the other hand, a distributed team can be set up with members working from many different locations and time zones. Also, if a few members are working in a distant office together and others are working from various parts of the world – such teams can also be identified as distributed teams.

Pros and Cons of Distributed Teams

Pros of Distributed Teams 

  • Reduction of operational costs
  • Perfect for early-stage tech development when you have limited resources
  • Having the ability to hire the best talents from all over the world
  • Increased employee retention since companies don’t need to lay employees off even if they migrate to another country
  • Employees work from different timezones, so companies can provide customer service or sales over a larger time period throughout the day
  • Team member working on one shift can pass their work to team members working on the next shift. So, continuous development is ensured round the clock. 
  • Employees from different countries and continents can bring fresh insights into their local markets if you are looking to expand the business into those markets.

Cons of Distributed Teams 

  • There’s a need to document each and everything that is being worked on or the decisions that are being taken
  • Team members rarely or never meet in-person
  • Members working in multiple time zones make it difficult to hold a meeting with everyone participating
  • Setting up payment processes and tools for employees in different locations
  • Integrating a new employee into the team and its culture is sometimes challenging

Pros and Cons of Remote Teams

Pros of Remote Teams 

  • Better work-life balance
  • Opportunity to work from company office for team members who prefer on-site office to remote work
  • Cost reduction
  • Employees are more self-dependent and as a result, self-sufficient
  • Advantage of hiring more employees without increasing operational costs

Cons of Remote Teams 

  • Need to set up remote hiring and onboarding structure
  • Need to have an on-site office of the organization, which may be difficult for early-stage startups/companies
  • Less face-to-face interactions
  • Employee retention is not possible unlike distributed teams
  • The talent pool to hire from is limited
  • People are working in the same timezone, so sales service or customer support cannot be provided for a larger time period throughout the day as it’s possible with distributed teams

How to Choose Between Distributed Teams and Remote Teams

After reading up to this point, you must be wondering how the decision makers of an organization can figure out which one to choose between remote and distributed teams. To address this specific question, let’s remind ourselves of the definitions of distributed teams and remote teams again.

Distributed teams consist of team members who are spread across different locations. On the contrary, remote teams are a mix of distributed teams and on-site teams. One or a few team members can work from the on-site facility of your company with remote teams and all team members have the freedom to work remotely – part-time or full-time.

Now coming to the point of figuring out which one of the remote teams and distributed teams suit your modality, below is a set of questions that will lead you in the right direction.

  1. Does your company have a physical office of its own?
  2. How often do you need your employee to gather together?
  3. Do you need a centralized office where you need your different teams can get together in person?
  4. How rich is your local talent market? Is the country where your on-site office is located able to meet your demands for competent employees?
  5. Do you need to have an on-site location?
  6. Do you have important employees who are looking to move out of the area?
  7. How good are your resources such as equipment and software solution? Does your company have the ability to set up remote teams or distributed teams?

Final Words

While both remote teams and distributed teams offer a few similar advantages such as flexibility and reduced operational costs; remote teams lag behind distributed teams when you consider the whole picture. With remote teams, you still need to have a company office and you still are limited by borders.

On the other hand, distributed teams let you spread wings, and hire from everywhere, and don’t need you to have a centralized office place.

OSTDO by Ban Base – A Result-driven Modality of Distributed Teams

OSTDO refers to Offshore Tech Development Office. Among the various models of distributed teams, this model has captured the imagination of even the global leading corporations for their tech development. OSTDO has proven to be the right solution for PayPal, P&G, Telenor, Oslobuss, Nissan, and many others! The unique benefit of OSTDO by Ban Base is that your hired tech teams will work from a state-of-the-art office space in Bangladesh, under the supervision of a veteran project manager. This will ensure a smooth onboarding process for your distributed tech teams into your company and the quality of their deliverables – at different all-in monthly competitive packages. And most importantly, with OSTDO, be a first-mover in the market with your idea. From hiring to your developers getting started with your projects – everything is set up in just 20 days. Interested to check Ban Base’s different pricing modalities for OSTDO with a 14-day free trial?

About the Author

Tanvir Wazy Ullah Patwary