Building virtual teams can present many opportunities for businesses. It’s important to think beyond cost savings to the logistics of managing people who are working remotely, often across the world.
Quick takeaways if you’re in a hurry
- Virtual teams present great opportunities for cost savings, but these need to be viewed in context with the management requirements
- Communication is key to manage both the processes and the relationships across a remotely located team
- Building cultural awareness is a worthwhile exercise for any business planning to use virtual teams
Read on: Building virtual teams: A few things to consider
(estimated reading time: 6 minutes)
It’s not uncommon for businesses to believe that building virtual teams will yield cost savings and multiple benefits. In terms of benefits these could be demonstrated to be: high skill levels, cultural diversity, unique perspective and high productivity.
However using virtual resources is not as straightforward as welcoming a new person to the desk next to yours. When a business considers creating a virtual team they could be facing a raft of complexities that could risk unseating cost savings and undermining benefits. So when is a virtual team the right tool for business?
What’s the cost?
If a virtual team is on the menu, then a business is probably already aware of some of the advantages. The cost savings associated with virtual teams come from a number of different factors.
If a business plans to recruit the best talent to deliver the task that their business needs, then a virtual team takes away the obstacle of location. The impact of currency and geography on rates of pay means that, in some circumstances, a business will pay less for this talent than they would if they were recruiting in the same city.
There are also some tangible cost savings on the part of the employee as their actual cost of doing business is reduced. They save time and money by working from home or a remote office location, and avoid a daily commute to and from the office.
But as many businesses who consider virtual teams are focused on recruiting the best talent, salary is often not one of the key areas of cost saving. This could come instead from areas such as real estate.
Allowing employees to work away from the office – whether that be from home or from another city or country altogether – can yield large savings in real estate costs. Businesses are able to reduce their office footprint as more staff work remotely.
As early as 2008, Workforce Management identified in an article that Sun Microsystems realised savings of over $70M with 18,000 virtual workers [Workforce Management (July 3, 2008): Employers offering telecommuting to cut real estate costs] This is of course a large scale cost saving driven by large scale remote working. An optimum virtual team usually has no more than ten members, so the savings will be considerably smaller.
Diverse skills and personalities
Effectively managing a virtual team is about more than just cheap labour. For virtual teams to be functional it’s ideal if they can be recruited as a group, so that a business can carefully manage the personalities and skill sets for optimum performance.
According to a Harvard Business Review article on Getting Virtual Teams Right, effective virtual teams share some consistent character traits. These include high emotional intelligence; good communication skills; and the ability to work independently.
Personality and skills can be tested during the recruitment process. Investing in the right team members upfront can yield large benefits in the long run: virtual teams are notoriously challenging to manage effectively so having the right personalities will give businesses a head-start.
A boost to productivity
A well managed virtual team can increase productivity. A study by Aon Consulting found that productivity in a virtual team could increase by between 10 and 43 percent, depending on the organisation.
However this doesn’t happen naturally and requires an investment in time by the managing company in order to get it right. Without carefully guidance a virtual team is more likely to fail than one located in the same office. The main tool that virtual teams require is careful process and result mapping.
This means that the team is collectively aware of what their purpose is and individually aware of what each person’s contribution to that purpose needs to be. The cycle of delivery needs to be carefully managed by a team leader to ensure deadlines are achieved and information is shared effectively.
Communication is key
Keeping a virtual team on track and delivering the results a business requires is an exercise in excellent communication. Virtual teams require more than just good technology to facilitate communication: but good technology is essential.
Businesses need to recognise how their virtual teams work and then supply the best tools. This will ensure they are optimising the opportunities for collaboration and interaction.
The team leader needs to manage a structured cycle of meetings to ensure that the virtual team has shared time together on a regular basis. Frequent 1:1 meetings with the team leader will also help to share perspectives and resolve any issues.
More complex than functional communication is how a team leader manages social interactions. These are essential to uniting a team and creating the emotional bonds necessary to improve productivity.
Teams require trust, respect, and empathy in order to function effectively, and these can be challenging to create if a team is located remotely. Team leaders of virtual teams must become experts in fostering social interactions at a remote level.
Businesses may wrongly perceive that remote teams will be more productive because they will drop down-time taken up with social interactions and ‘daily chit-chat’. In reality this is a key part of the toolkit that connects employees to each other and to the business. Social interactions must be artificially sustained to build and maintain that connection.
Culture is of great importance
Recruiting and managing a team of people who are remotely located, and potentially based in different countries, requires great cultural awareness. Large businesses are often up to speed with the importance of cultural awareness, even for interactions with staff who are based in the same city or country.
For businesses who have not had experience of dealing with other cultures upskilling is essential. Ensuring that both team members and team leader are culturally aware is key to being able to build the processes that will resolve any potential cultural friction.
With employees of five different cultural backgrounds in a meeting there is every possibility that each of these employees is used to a different and contrasting way of reaching a decision. The diplomacy of the team leader is essential in creating processes that bridge the cultural divide. Clear definition of processes and procedures will ensure that everyone is on the same page.
It’s easy to believe that building virtual teams is an easy solution. More realistically virtual teams offer businesses the opportunity to access skills by removing the boundaries of geography. There are great benefits in productivity and diversity to be gained by introducing a virtual team to a business, but they come at the cost of increased input and the careful management that is required to ensure that the required output is achieved.
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