KEY CONCEPT

Virtual teams, groups of diverse and geographically dispersed people communicating mainly by technology, pose challenges for companies. They can deliver superior performance and become an important source of value creation, but they demand a new management and leadership approach. Organizations that apply the ‘rules’ for classic or traditional teams will be disappointed.

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IDEA SUMMARY

Virtual teams, made necessary by globalization and possible by technology, are now common in business. They’ve taken over traditional functions such as procurement, manufacturing, IT and finance, as well as newer activities such as global supply chain and global service delivery. They’re often assembled for new-product development and R&D. And they’re increasingly found at the very top of organizations. (The virtual HQ is becoming the norm for multinational companies.)

Providing access to distant and context-specific knowledge that can be combined as customer insight and innovation, virtual teams are capable of contributing as much to organizations as their classic or traditional counterparts. But they have a serious disadvantage. They are, at root, an artificial form of human collaboration that limits the opportunities to share knowledge and, crucially, build momentum and trust. Evolution did not prepare us for working remotely from others. The classic team, where members are ‘confluent and co-located’, comes more naturally to us.

How, then, can virtual teams be effectively led and managed? Classic models for teamwork such as ‘forming, storming, norming and performing’ won’t apply. Research over the past 20 or so years suggests a different approach is needed — one that ‘designs in’ structures and processes that compensate for the ‘unnatural nature’ of virtual teams. Recommendations include:

• Formally identifying the ‘reciprocal interdependencies’ the task demands and deciding how these will be managed. (Temporary co-location of some workers might be necessary.)
• Appointing a team manager not just a team facilitator.
• Organizing ‘socialization’ events that bring participants together and help them understand the context in which each of them works. (This might be particularly important just before ‘team launch’.)
• Encouraging and budgeting for extensive visits across sites by team members who have been designated as ‘bridges’.
• ‘Enabling random encounters’ — by, for example, allowing time in conference calls and videoconferences for ‘off topic’ conversations about things that are happening at the various sites or problems and opportunities people have encountered.
• Tailoring the use of ICT — by, for example, choosing email for simple exchanges and conference calls and video chats for more ‘contextual’ conversations.
• Including face-to-face meetings in the communications mix and ‘rotating’ these meetings between sites.
• Avoiding or addressing uneven access to ICT. (If one site does not have broadband, the use of video should be limited.)
• Avoiding uneven distribution of information. (Making sure everyone receives and reads any documents that are sent out before conference calls.)
• Being sensitive to time differences — scheduling calls/video conferences fairly so that it’s not the same people who are inconvenienced each week/month.

Approaches like these will help virtual teams to become greater than the sum of their individual parts. Without them, a virtual team is likely to be very slow to integrate knowledge — and, potentially, at least, a drain on a company’s resources. 

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BUSINESS APPLICATION

Understanding virtual teams — and the conditions in which they work — could soon be seen as a core leadership competence.
There are two key points for senior leaders — and those who aspire to be senior leaders — to bear in mind:

• Distance is a disadvantage — and it cannot always be overcome satisfactorily by ICT. Steps have to be taken to close the literal and psychological gaps that exist between members of virtual teams. (Face-to-face meetings are often the only way to build relationships and get things done.)
• Approaches to virtual teamwork should always put the emphasis on the word ‘virtual’ rather than the word ‘team’. (To lead and manage virtual teams effectively we need to acknowledge that they’re different — and know why.)

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REFERENCES

Designing and Leading Virtual teams. José Santos. INSEAD Working Paper (2013).

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