Management Publications Management

8-1998

Virtual : and the of the Future

Anthony M. Townsend University of Nevada, Las Vegas, [email protected]

Samuel M. DeMarie University of Nevada, Las Vegas

Anthony R. Hendrickson Iowa State University

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Abstract Managers are challenged to develop strategically flexible in response to increasingly competitive marketplaces. Fortunately, a new generation of information and technology provides the foundation for resilient new organizational forms that would have not been feasible only a decade ago. One of the most exciting of these new forms, the virtual , will enable organizations to become more flexible by providing the impressive of team-based designs in environments where teamwork would have once been impossible. Virtual teams, which are linked primarily through advanced computer and telecommunications , provide a potent response to the challenges associated with today's downsized and lean organizations, and to the resulting geographical dispersion of essential employees. Virtual teams also address new workforce demographics, where the best employees may be located anywhere the world, and where workers demand increasing technological sophistication and personal flexibility. With virtual teams, organizations can build teams with optimum membership while retaining the advantages of flat organizational structure. Additionally, firms benefit omfr virtual teams through access to previously unavailable expertise, enhanced cross-functional interaction, and the use of systems that improve the quality of the virtual team's work.

Disciplines Business Analytics | Management Information Systems | Marketing | Operations and Supply Chain Management | Organizational Behavior and Theory | Technology and Innovation

Comments This article is published as 51. Townsend, A.M, DeMarie, S.M. and Hendrickson, A.R. (1998). Virtual Teams: Technology and the workplace of the future. Academy of Management Executive, 12(3), 17-29. Posted with permission.

This article is available at Iowa State University Digital Repository: https://lib.dr.iastate.edu/management_pubs/55

Virtual Teams: Technology and the Workplace of the Future Author(s): Anthony M. Townsend, Samuel M. DeMarie and Anthony R. Hendrickson Source: The Academy of Management Executive (1993-2005), Vol. 12, No. 3 (Aug., 1998), pp. 17-29 Published by: Academy of Management Stable URL: https://www.jstor.org/stable/4165474 Accessed: 24-02-2020 19:49 UTC

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This content downloaded from 129.186.176.218 on Mon, 24 Feb 2020 19:49:44 UTC All use subject to https://about.jstor.org/terms Academy of Management Executive, 1998, Vol. 12, No. 3

Virtual teams: Technology and the workplace of the future

Anthony M. Townsend, Samuel M. DeMarie, and Anthony R. Hendrickson

Executive Overview Managers are challenged to develop strategically flexible organizations in response to increasingly competitive marketplaces. Fortunately, a new generation of information and telecommunications technology provides the foundation for resilient new organizational forms that would have not been feasible only a decade ago. One of the most exciting of these new forms, the virtual team, will enable organizations to become more flexible by providing the impressive productivity of team-based designs in environments where teamwork would have once been impossible. Virtual teams, which are linked primarily through advanced computer and telecommunications technologies, provide a potent response to the challenges associated with today's downsized and lean organizations, and to the resulting geographical dispersion of essential employees. Virtual teams also address new workforce demographics, where the best employees may be located anywhere the world, and where workers demand increasing technological sophistication and personal flexibility. With virtual teams, organizations can build teams with optimum membership while retaining the advantages of flat organizational structure. Additionally, firms benefit from virtual teams through access to previously unavailable expertise, enhanced cross-functional interaction, and the use of systems that improve the quality of the virtual team's work.

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You have no choice but to operate in a world This exciting new potential comes at a time shaped by and the information when increasing global competition and recent revolution. There are two options: Adapt or advancements in information technologies have die.... You need to plan the way a fire de- forced organizations to reevaluate their structure partment plans. It cannot anticipate fires, so it and work processes. Many organizations have has to shape a flexible that is downsized and there are continuing pressures to capable of responding to unpredictable implement increasingly flat (or horizontal) orga- events. nizational structures. While these new organiza- -Andrew S. Grove, Intel tional structures may achieve gains in efficiency, flat organizational structures, of necessity, dis- Just as the personal computer revolutionized the perse employees both geographically and orga- workplace throughout the 1980s and l990s, recent nizationally, which makes it more difficult for developments in information and those members to collaborate in an effective technology are on the verge of creating a new manner. revolution in the coming decade. A group of tech- One popular response to this challenging new nologies, including desktop video conferencing, environment has been to outsource a number of collaborative , and /Intranet sys- organizational functions, replacing traditional tems, converge to forge the foundation of a new structure with an interorganizational network or workplace. This new workplace will be unre- virtual organization. Virtual organizations have re- strained by geography, time, and organizational ceived substantial attention in both popular and boundaries; it will be a virtual workplace, where academic literature.2 While the interorganiza- productivity, flexibility, and collaboration will tional challenges presented by virtual organiza- reach unprecedented new levels. tions are important, this leaner new competitive

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This content downloaded from 129.186.176.218 on Mon, 24 Feb 2020 19:49:44 UTC All use subject to https://about.jstor.org/terms 18 Academy of Management Executive August landscape presents important intraorganizational Virtual teams provide additional benefits in that challenges as well. they also can be used to address evolving interor- During the past several years, one of the most ganizational challenges that occur when organiza- dominant intraorganizational initiatives has been tions outsource some of their key processes to more the development of team-based work systems. specialized firms. By creating virtual teams, both Many organizations have recognized that team- within virtual organizations and within organiza- based structures have the potential to create a tions undergoing other forms of transformation, more productive, creative, and individually fulfill- firms can ultimately realize the competitive syn- ing working environment. A majority of U.S. corpo- ergy of teamwork and exploit the revolution in rations use some form of team structures in their telecommunications and information technology. organizations, and many report that teams en- hance their ability to meet organizational goals.3 Why Virtual Teams? In general, teams have provided firms with signif- icant gains in productivity, and as such, have be- Although the modern organization faces a number come a fixture among contemporary organizations. of challenges in its competitive environment,5 the But what happens to the team advantage when imperative for moving from traditional face-to-face fundamental organizational structures begin to teams to virtual teams derives primarily from five change? Can teams survive amidst radical transi- specific factors: tions in the greater organization? Perhaps more 1. The increasing prevalence of flat or horizontal importantly, can radically transformed organiza- organizational structures. tions recapture the productive potential of team- 2. The emergence of environments that require in- based work? terorganizational cooperation as well as compe- tition. A majority of U.S. use some 3. Changes in workers' expectations of organiza- tional participation. form of team structures in their 4. A continued shift from production to service/ organizations, and many report that knowledge work environments. teams enhance their ability to meet 5. The increasing globalization of trade and corpo- organizational goals. rate activity.

The emergence of the flat or horizontal organi- Recapturing the benefits of team systems will re- zation is largely a response to intensifying compet- quire flat organizations to create teams whose itive operating environments brought about by members may no longer be located together, or increased global competition and recent advance- may even include members from outside the orga- ments in both information and transportation tech- nization. Fortunately, this period of radical organi- nologies.6 Organizational flattening pushes deci- zational change has been accompanied by an sion authority to lower levels in the organization, equally radical change in telecommunications and reducing the need for several layers of manage- computer technology. Thanks to these new tech- ment. With fewer layers of centralized, hierarchi- nologies, teams can now be effectively reconsti- cal management structure, organizations become tuted from formerly dispersed members. Thus, a increasingly characterized by structurally and key component of successful, twenty-first century geographically distributed human resources. organization will be the effective use of virtual While the organization may retain the collective teams. talent it requires, there is a reduction in the oppor- Virtual teams are groups of geographically tunity for linkages between remaining employees and/or organizationally dispersed coworkers that (e.g., personnel and close enough to facili- are assembled using a combination of telecommu- tate traditional interaction). This kind of environ- nications and information technologies to accom- ment occasions the need to reconstitute the bene- plish an organizational task. Virtual teams rarely, fits of the large, resource rich organization within if ever, meet in a face-to-face setting. They may be the context of the new flattened organization. set up as temporary structures, existing only to A second trend is a shift from traditional com- accomplish a specific task, or may be more perma- petitive business environments toward strategic nent structures, used to address ongoing issues, cooperation among a synergistic group of firms such as strategic planning. Further, membership is that may not only coexist, but also actually nurture often fluid, evolving according to changing task each other.7 In the past, firms vertically integrated requirements.4 to maintain more control of processes from the

This content downloaded from 129.186.176.218 on Mon, 24 Feb 2020 19:49:44 UTC All use subject to https://about.jstor.org/terms 1998 Townsend, DeMarie, and Hendrickson 19 acquisition of raw materials to the manufacture of vanced technologies to facilitate their complex the final product. However, diversification and communication processes. specialization have made direct management of far-flung processes unwieldy. Thus, firms have re- sponded to this problem by eliminating their su- Group success is dependent on effective perfluous processes to concentrate on their core, and knowledge sharing value-added processes. Strategic partnering among members. and/or outsourcing allows efficient span of control while maintaining larger economies of scale for the cooperative organizational group. The third major trend in the business environment Although this segmentation enables more effi- centers on changes in employee expectations of cient management of each individual process, it how they will participate in the workplace. Future often fails to provide an overarching structure by employees, who have grown up in an environment which these specialized organizations can com- of personal computers, cellular phones, and elec- pete within a large global market. These coopera- tronic classrooms, will be more likely to expect tive groups of organizations become increasingly organizational flexibility. The new generation of interdependent, with the success of each individ- workers will be technologically sophisticated, and ual organization enhancing the success of the co- will expect technological sophistication from their operative organizational system. employing organization.8 An example of how A prominent example of this synergistic cooper- changing employee expectations are already af- fecting the workplace can be seen in the increas- ation is the collaboration among a number of com- ing number of employees who are opting for tele- puter hardware and software developers. Unlike work alternatives. Teleworkers operate from their IBM in previous decades, firms such as Intel and homes or some other remote location, connected to Microsoft have avoided vertical integration and a home primarily through telephones, fax achieved unprecedented growth and dominance in machines, computer modems, and electronic mail. the distributed computing environment. This suc- Telework provides cost savings to employees by cess is largely due to their concentration on their eliminating time-consuming commutes to central respective core disciplines, thus avoiding the lack offices and offers employees more flexibility to of focus inherent in vertically integrated organiza- coordinate their work and family responsibilities. tions. While they have created and nurtured an Teleworkers currently make up the fastest growing environment in which both organizations flourish, segment of the workforce.9 the ultimate value of each is dramatically depen- Virtual teams provide a platform for organiza- dent upon the other. Without significant advances tions to actually exceed these new employee ex- in chip technology, demand for personal comput- pectations. For example, telework is usually lim- ing software tools and distributed computing sys- ited to relatively independent categories that tems is limited. Conversely, advancements in com- involve low levels of collaboration. A virtual team puting software have led to an insatiable demand format can expand telework's potential range by for faster, more powerful microprocessors. allowing employees involved in highly collabora- Group success is dependent on effective commu- tive teamwork to participate from remote locations. nications and knowledge sharing among mem- A fourth factor encouraging the development of bers. Microsoft's success in a variety of industries, virtual teams is the continued shift from manufac- including personal computers, corporate comput- turing and production to service and knowl- ing, telecommunications, and consumer electron- edge work. Production processes, by their very na- ics, is directly attributable to the firm's networking ture, are often more structured and defined. with software developers within these supplier or- Service activities often require cooperation of team ganizations. By providing developmental versions members in dynamic work situations that evolve of new software, Microsoft facilitates communica- according to customer requirements. The hallmark tion with its customers and acquires invaluable of successful service firms has been their ability to feedback prior to releasing final versions of its flexibly respond to the customer's needs as quickly products. Product development is no longer an iso- as possible. This requisite flexibility fuels the lated task within the organization, but a collabo- movement from highly structured organizational rative effort in which product identity and loyalty forms to more ad hoc forms. Virtual teams enable is created via close customer involvement in the this organizational flexibility because they inte- development process. Virtual teams provide an ef- grate the effectiveness of traditional teamwork fective platform for these groups by using ad- with the power of advanced communication and

This content downloaded from 129.186.176.218 on Mon, 24 Feb 2020 19:49:44 UTC All use subject to https://about.jstor.org/terms 20 Academy of Management Executive August information technologies, allowing them to accom- simplest of meetings. The most sophisticated modate increased dynamism in both team mem- DVCS currently cost less than $1,000 per station, bership and task structure. can be added to most any new generation of per- Finally, the increasing importance of global sonal computer, and can be used with no outside trade and corporate activity has radically altered facilitation. This combination of affordability and the working environment of many organizations. operational simplicity make DVCS an affordable Recent trade agreements, such as GATT and organizational communications solution.'2 NAFTA, coupled with economic reforms in China Although technologically sophisticated, the and eastern Europe, have created increased oppor- DVCS is a relatively simple system for users to tunities for international trade. Whereas in the operate. A small camera mounted atop a computer past, multinational operations were solely the do- monitor provides the video feed to the system; main of the world's largest corporations, techno- voice transmissions operate through an earpiece/ logical advances in both communications and lo- microphone combination or speakerphone. Con- gistics have enabled smaller firms to compete in nection to other team members is managed the global marketplace. Regardless of firm size, through software on the user's computer; to ensure multinational operations require high levels of co- user familiarity, the software uses an on-screen operation and collaboration across broad geo- version of a traditional telephone to control the graphical boundaries.10 Turning these networks of system. The final component of the system is a collaborators into fully connected virtual teams has the potential to increase both the efficiency high-speed data connection, which may be accom- and quality of communications in this challenging plished through local area network connections, or environment. specialized digital phone lines. DVCS create the potential for two primary types of group communi- cation: The Technology of Virtual Teams

Virtual teams are possible only because of recent 1. All team members are actively connected in a advances in computer and telecommunications session. With current technology, groups of up technology. Because these technologies define the to sixteen team members can simultaneously operational environment of the virtual team, it is videoconference, meaning that each user can critical to examine how these technologies come see and hear up to fifteen other team members together to form the infrastructure of virtual team- on his or her computer monitor. Functioning in work. Although all of the systems are somewhat this mode, the entire team or subunits of the interdependent, it is helpful to consider them as team can conference as needed. belonging to one of three broad categories of tech- 2. A face-to-face group can interact with a non- nology: desktop videoconferencing systems present team member or outside resource. The (DVCS); systems; and Inter- same DVCS used for individual interaction also net/Intranet systems. These three technologies pro- permits a conference table of team members to vide an infrastructure across which the virtual have a traditional teleconference with one or team will interact and provide technological em- more outside parties. Because the DVCS allows powerment to the virtual teams' operation." for multiple conference connections, a local group can connect with up to fifteen different Desktop Videoconferencing Systems (DVCS) individuals or groups.'3

DVCS are the core system around which the rest of In addition to providing video and audio con- virtual team technologies are built. Although vir- nections, most DVCS provide users with the abil- tual teams would be possible with simple e-mail ity to share information and even applications systems and telephones, DVCS recreates the face- to-face interactions of conventional teams, making while they are interconnected. For example, us- possible more complex levels of communication ers can simultaneously work on documents, an- among team members. While the technology of alyze data, or sketch out ideas on shared white- videoconferencing is not new, traditional video- boards. In many respects, the DVCS creates a conferencing systems typically involved dedicated work environment where users have more op- meeting rooms that were very costly to set up and tions available to help them collaborate and maintain. These videoconference rooms were also share data than would be possible working cumbersome and inconvenient to use, requiring around a conference table or huddled around an specially trained technicians to facilitate even the office computer.

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Collaborative Software Systems into one common product. By combining a number of collaborative applications and communications Collaborative software systems are the second systems into an integrated framework, products component of the virtual team technical infrastruc- like Lotus Notes facilitate both the production and ture. Effective collaboration requires team mem- communication necessary to effective teamwork. bers to work both interactively and independently; Although most of these types of software systems collaborative software is designed to augment have been designed to facilitate teamwork in tra- both types of group work activity and to empower ditional work environments, they provide an teamwork processes.14 equally powerful foundation for the collaborative The simplest collaborative software application of virtual teams. involves sharing traditional software products through the DVCS. As noted above, most DVCS allow users to share any application running on The Internet and Intranets any one of their individual computers. Used in this The enormous popularity of the Internet is a sig- manner, a variety of existing software applications nificant indicator that a friendly medium can over- become powerful collaborative tools, allowing come the technophobia of a vast number of people, multiple team members to create, revise, and/or and this lesson has not been lost on business or- review important information. ganizations. Recognizing that the explosion of the A second category of collaborative software sys- Internet is a microcosmic glimpse of the potential tems is designed to empower real time group de- for employee interest and use of this new intercon- cision making and other creative activities. These nective technology, a number of firms have systems, called group support systems (GSS), are adapted state of the art Internet technologies into specifically designed to create an enhanced envi- internal , or Intranets. The Federal Ex- ronment for brainstorming, focus group work, and press Corporation provides a good example of this group decision making. These systems provide adaptive process. After finding that its Internet their users with a variety of support tools to poll website was a cost-saving solution for customer participants and assemble statistical information service, the company decided to try out the tech- relevant to the decision activity. Finally, these sys- nology on an internal basis. In 1995, the firm oper- tems also allow users to "turn off" their individual ated over sixty Intranet websites among thirty identities during a brainstorming session and in- thousand worldwide office employees.16 teract with relative anonymity, which can be very helpful in certain contexts.'5 As with traditional teams, a substantial portion The enormous popularity of the Internet of the work of virtual team members may be con- is a significant indicator that a friendly ducted independently, and then passed along to medium can overcome the technophobia the rest of the team at appropriate stages of the of a vast number of people, and this team's project. For this noninteractive aspect of the lesson has not been lost on business virtual team's work, there is also a developing organizations. body of software. This family of software provides specific support for collaborative accomplishment (e.g., , product design, docu- Intranets provide organizations the advantage of ment creation, and information analysis) when using Internet technology to disseminate organiza- team members are working independently on team tional information and enhance interemployee projects. The major focus of these collaborative communication, while still maintaining system se- software applications is to facilitate multiple au- curity. With the Internet and Intranets, organiza- thorship of documents and presentations, and joint tional users realize the benefits of the familiarity of development of databases, spreadsheets, and the same connective interface, whether working other information resources. with internal or external information. For the vir- Collaborative software systems also may pro- tual team, the Internet and Intranets provide an vide a comprehensive environment for group work. important communicative and informational re- Lotus Notes, a dominant collaborative software source. They allow virtual teams to archive text, product, is designed specifically for asynchronous visual, audio, and numerical data in a user- teamwork (e.g., communication and data sharing friendly format. The Internet and Intranets also where parties are working either at different times allow virtual teams to keep other organizational or independently) and combines scheduling, elec- members and important outside constituents such tronic messaging, and document and data shatring als suppliers and customers up-to-dalte on the

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team's progress, and enable the team to monitor tunity for efficiencies and team synergy unrealized other ongoing organizational projects that might in traditional work interaction. John Verity writes: affect the task at hand. The Internet and Intranets make a significant That is the essence of virtualization: rather contribution to the collaborative environment be- than simply recreating in digital form the cause of the way that information is managed on physical thing we know as a letter, e-mail both systems. They have proven to be a rich source reinvents and vastly enhances letter-writing. of qualitative information, and new methods of Unbound by barriers of time and space and information search and retrieval have been devel- endowed with new powers, the electronic let- oped to effectively sort through their enormous vol- ter does something new altogether. The same ume of information. Systems such as Digital Equip- sort of thing happens when business, the arts, ment Corporation's AltaVista search engine or government are reborn in digital form.'7 provide a means to quickly and effectively locate information-first on the Internet, and now on In- Recreating teams in virtual mode requires resolu- tranets and individual computers. Unlike tradi- tion of the challenges and opportunities inherent tional database software, which requires highly in virtual team technology, as well as the develop- structured data, advanced search engines are able ment of a new team sociology. find text-based information from within a jumble of file types and formats. Most recently, these prod- New Challenges in Structure, Technology, and ucts have been enhanced to incorporate the very Function latest in user-friendly interfaces, further improving users' effectiveness by making an information As discussed earlier, changes in organizational search a more intuitive process. By enabling users structure and advances in informational technol- to locate documents and text-based information ogy define the environment in which the virtual from anywhere in their workgroup, these new data team operates. While many of these challenges management tools provide a workable way to are present in traditional work settings, they be- manage the distributed information resources of come more pronounced in the virtual environment. virtual teams. Consider the following: Taken together, DVCS, collaborative software * More so than a traditional workgroup, the virtual applications, and Internet/Intranet technologies team will probably have membership represent- form an informational infrastructure within which ing a number of different geographic locations virtual teams can match or even surpass the ef- within the organization, and may also include fectiveness of face-to-face teams. Unfortunately, contingent workers from outside the organiza- technology provides only a foundation for virtual tion. teamwork; the real challenge to virtual team effec- * Virtual team members will be challenged to tiveness is learning how to work with these new adapt to the and informa- technologies. Although these new technical sys- tional technologies that link its members. Vir- tems provide an incredibly rich communication tual team members will have to learn to use context for virtual team members, they do not truly effectively new telecommunications systems in replicate the face-to-face environment. As such, an environment where an important client or virtual team members are challenged to recapture coworker is frequently never physically present. the effectiveness of face-to-face interactions using * The virtual team's role transcends traditional the virtual tools that are available to them. fixed functional roles, requiring virtual team members to be prepared to adapt to a changing variety of assignments and tasks during the life Virtual Team Building of any particular team.

Developing effective virtual teams goes well be- All of these factors affect the environment in which yond the technical problem of linking them to- the individual members of virtual teams must gether. As workers increasingly interact in a vir- learn to operate. tual mode, it is imperative that they rebuild the Virtual teams, because they have the potential to interpersonal interaction necessary for organiza- significantly decrease the amount of travel re- tional effectiveness. While the virtual team pre- quired of team members, can significantly in- sents a number of challenges in this area, it also crease the productive capacity of individual mem- presents the potential to recreate the way work is bers. For this reason, virtual team members may done. Within the virtual connection lies an oppor- be arsked to participarte in al higher number of sep-

This content downloaded from 129.186.176.218 on Mon, 24 Feb 2020 19:49:44 UTC All use subject to https://about.jstor.org/terms 1998 Townsend, DeMarie, and Hendrickson 23 arate team situations than was practical in tradi- vironment of virtual team members is the process tional face-to-face teamwork. Thus, virtual team of virtual interaction. Although electronic mail and members may have multiple (and even competing) various document-sharing capabilities have been alliances outside their specific virtual team. This in use in traditional work settings for some time, same challenge has been observed in traditional these systems have generally been supported by work settings, both in situations where contingent face-to-face meetings and geographic proximity to workers interact with permanent workers and other workgroup members. In the virtual work en- when members of teams or workgroups are also vironment, traditional social mechanisms that fa- members of other groups competing for their time cilitate communication and decision making are and attention. Although problems associated with effectively lost and participants must find new these factors are not new, outsourcing, organiza- ways to communicate and interact, enabling effec- tional partnering, and the efficiencies afforded by tive teamwork within the new technical context. advanced information technologies have in- creased the potential for conflict caused by multi- ple organizational roles. In the virtual work environment, Furthermore, the virtual team environment rep- traditional social mechanisms that resents a pronounced structural difference from facilitate communication and decision traditional workgroup participation because of making are effectively lost and their ability to transform quickly according to participants must find new ways to changing task requirements and responsibilities. communicate and interact, enabling Virtual team membership will be substantially more dynamic than traditional teams and virtual effective teamwork within the new teams will be more likely to include members from technical context. locations that would not traditionally have worked together. This dynamism requires virtual team members to be particularly adaptable to working Changes in Work and Interaction with a wide variety of potential coworkers. The challenges detailed above have the potential Differences in the functional role of the virtual to create a radically different work environment for team within the broader organization also create a the virtual team participant, both because of the different environment for the virtual team and its change from face-to-face to some degree of virtual members. Virtual teams provide the capability for interaction, and because the virtual team is ex- more flexible organizational responses, which pected to operate in a different form of organiza- means that the role of the virtual team, as well as tion and assume new organizational roles. These the roles attributed to its members, will be sub- changes in the work setting affect the way that stantially more dynamic than in traditional set- team members conduct their work and how they tings. The Danish hearing aid manufacturer, Oti- communicate and express themselves: con, exemplifies this concept. After several years of attempting to turn the company around using * Virtual team members must learn new ways to traditional cost-cutting and strategic marketing express themselves and to understand others in techniques, the president decided to restructure an environment with a diminished sense of pres- the organization into what is essentially a giant ence. virtual team. Conceptualizing the entire staff as * Virtual team members will be required to have one large 150-member team, the firm now draws superior team participation skills. Because team the necessary skills for specific projects from a membership will be somewhat fluid, effective pool of workers whose diverse skills most appro- teams will require members who can quickly priately fit the project and task requirements.'8 assimilate into the team. Each employee's physical location is no longer a . Virtual team members will have to become pro- barrier to effective team structure. What remains ficient with a variety of computer-based technol- critical is how individual skill sets meet project ogies. requirements driven by an ever-evolving business * In many organizations, virtual team member- environment. Virtual teams like these are more ship will cross national boundaries, and a vari- capable of addressing an evolutionary mission be- ety of cultural backgrounds will be represented cause their technological infrastructure is de- on the team. This will complicate communica- signed to facilitate transformations in response to tions and work interactions, and will require changing organizational requirements. additional team member development in the ar- By far the greatest difference in the working en- eas of communication and cultural .

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Research has indicated that when the trappings of and how they can overcome these differences and traditional communicative patterns are absent, use them to the team's advantage. communication dynamics are substantially al- Advanced technologies may also be used to im- tered. For example, in workgroup systems where prove or streamline the socialization of new team members' primary interactions are through some members. For example, Intranets allow teams to form of electronic mail, the absence of traditional archive a wide range of information. New team communicative cues (i.e., facial expression, ges- members potentially could access a complete elec- ture, and vocal inflection) make subtleties in com- tronic history of the team's work, including not only munication more difficult to convey.'9 Additionally, text-based and graphical information, but also when participants are able to use a communica- video and audio recordings of important team tion system anonymously, the group also begins to meetings. The availability of this rich history may lose distinctions among members' social and ex- allow new members to be brought up to speed on pert status.20 Thus, the loss of traditional cues cre- team task, culture, and members' personalities ates an environment that is substantially different much more quickly than in traditional face-to-face from face-to-face interaction, requiring partici- teams. pants to reconstruct a viable workgroup dynamic. Recall too that technology presents the opportu- nity to enhance a team's effectiveness by empow- Within this reconstructed environment, there is an ering the teams' collaborative activity. Both re- opportunity for enhanced organizational democ- search and industry experience indicate that racy and participation in work and decision mak- collaborative systems can augment a group's de- ing. Although technology certainly presents an op- cision quality and performance potential,23 and portunity for such development, the team's will likely do so in the virtual environment as sociology will ultimately be a function of technol- well.24 Given a proper set of communicative proto- ogy, the larger organizational culture, and the cols (e.g., telephones, DVCS, electronic mail, and team's task requirements.2' Internet/Intranets), collaborative software systems Within the larger organizational culture and the will add enormous performance potential to the technical environment, the group dynamic of a vir- virtual teams' environment. While learning to use tual team depends on the socialization process of collaborative tools is no more difficult than learn- the individual team. Unlike many traditional ing many other software systems, the effective use teams, virtual teams will be expected to be able to of collaborative tools likely will reorient the atti- repeatedly change membership without losing tude of users toward the process of work. Michael productivity; little time will be available for team Schrage writes: members to learn how to work together. Thus, ef- fective virtual team members will have to be par- Collaborative tools and environments will ticularly adept at fitting into a variety of team spark the same kinds of questions and con- situations. cerns as other fundamental technologies, The traditional factors identified with high team which will in turn determine the effectiveness performance come into play in the virtual environ- of both individuals and enterprises. "Why ment as well. Effective communication skills, clar- won't he get out the good collaborative tools ity of goals, and a performance orientation will with me?" is a question not unlike "Why won't continue to be critical attributes for virtual team he talk with me on the phone?" ... The tech- members.22 To fully exploit the advantages of the nology becomes a frame of reference and a new environment, virtual team members will re- new infrastructure for the way people relate quire basic teamwork training and development, to one another.25 and will also need training to enhance team work- ers' facility with the new information and commu- Thus, among virtual team members, collaborative nication technologies. Effective training in such tools not only enhance the productive capacity of virtual function skills as how to best use telecom- the team; they also become a central medium of municative capability and collaborative systems, the team's work process. may ultimately result in teams that function as naturally in a technologically empowered, virtual Capitalizing on Virtual Teams environment as teams currently do around a con- ference table. Additionally, when team members It is important to stress that virtual teams are not represent a variety of national or cultural groups, an organizational panacea and that the degree to there will also be the need to teach team members which organizations will benefit may differ. Devel- how each of their respective cultures may differ oping the technology and employee skills neces-

This content downloaded from 129.186.176.218 on Mon, 24 Feb 2020 19:49:44 UTC All use subject to https://about.jstor.org/terms 1998 Townsend, DeMarie, and Hendrickson 25 sary for effective virtual team implementation car- team will provide reports, interim deliverables, ries a cost in time and financial investment that and final product. must be offset by the competitive advantage vir- It is also critically important that managers clearly tual teams afford. Digital Equipment Corporation define the virtual team's role within the context of the provides an excellent example of the productive organization's greater mission, including the limits potential of virtual teams, having used them to of the team's scope and responsibility. This will help develop computer systems for years. These teams the team to focus its efforts on activities that support share databases, simulation and modeling sys- the strategic direction of the firm. tems, and advanced communication systems to support the collaborative design of new products. This organizational structure has enabled Digital Defining the Team's Organizational Role and to increase the productive capacity of its technical Function experts, and maintain its position as a leader in its Virtual teams may be implemented as a response to field.26 one or a number of conditions detailed in the preced- Therefore, although virtual teams provide many ing sections. In turn, these underlying reasons for the exciting opportunities, organizations require clear introduction of virtual teams should determine the understanding of the purpose and goals they have configuration of individual teams, dictate their mis- for virtual team implementation. The organiza- sion, and ultimately determine the type of technical tional challenge is first to effectively create the virtual team and, second, to overcome the inherent system required and the requisite skills and orienta- resistance that inevitably accompanies large scale tion of the team and its members. The following innovation. description of two types of team roles, while certainly not exhaustive, illustrates some of the range of the role and function of the virtual team.

Creating Virtual Teams Teams that are created to provide strategic re- sponses to rapidly changing market conditions will Once an organization determines that it has a need operate in the most fluid of all virtual team environ- for virtual teams, the next challenge is to actually put ments. In addition to all of the challenges associated them in place. At this juncture, the organization must with virtual teamwork, these teams will be required define the teams' function and organizational role, to continuously evolve to meet changing tactical con- develop the technical systems to support the teams, ditions. The configuration of these teams will be and assemble individual teams, as well as a cadre of highly dynamic and dependent on current task and potential team workers.

Teams that are created to provide Managerial Direction and Control strategic responses to rapidly changing Just as in any team environment, managers will market conditions will operate in the need to clearly establish expectations about the most fluid of all virtual team virtual team's performance and criteria for assess- environments. ing the team's success. Because of the dispersion of team members, effective supervision and control of the virtual team may appear problematic. How- planning requirements. The role of these teams ever, the virtual team's rich communicative envi- (and of the range of their potential participants) ronment, along with the system's capacity for ar- will be as highly adaptive response units, whose chiving data and communications, actually mission is to respond to market challenges and empowers considerably more managerial monitor- exploit market potentials. For example, Lithonia ing than is possible in traditional environments. Lighting developed virtual marketing response Managers could, for example, actually view ar- teams from among independent sales agents, out- chived recordings of team meetings to assess side distributors, and their own electrical engi- member contribution and team progress. Finally, neers. These virtual teams, which represent both the reporting and administrative relationship be- product developers and end-user suppliers, pro- tween the team and its external manager or man- vide the company with a unique capability to re- agers must be clearly established. Again, because spond quickly to changes in the market and cus- none of the team members will necessarily be lo- tomer needs. Using these virtual teams, the cated in the same place as external management, company has dramatically increased both sales clear schedules must be established of when the volume and customer satisfaction, while supply

This content downloaded from 129.186.176.218 on Mon, 24 Feb 2020 19:49:44 UTC All use subject to https://about.jstor.org/terms 26 Academy of Management Executive August chain administrative costs have remained con- basic DVCS systems. However, depending on the stant or decreased.27 frequency of use and the number of participants, Although flexibility is one of the potential vir- these teams may need more advanced DVCS sys- tues of the virtual team, virtual teams may also be tems that use dedicated high-speed phone lines created to operate in environments characterized that allow information to flow more quickly be- by long-term membership and long task cycles. tween participants and allow for near broadcast Virtual teams involved in complex development quality video transmission. Although the more ad- projects, for example, will capitalize on their abil- vanced systems add considerable cost to the ity to access a broader range of expertise and to DVCS, the increased costs may be justified where more easily link to diverse functional resources. video interaction must be as absolutely seamless The role of these teams will be to manage and as is possible, such as in client presentations or execute traditional organizational processes, but sensitive negotiation sessions. with the advantage of resources and expertise un- available save for their virtual construction. Developing Teams and Team Members

In addition to developing the hardware and soft- Developing the Teams' Technical Systems ware infrastructure for virtual teams, it is equally Once the role and mission of the teams have been critical to develop the teams themselves and to clarified, the technical systems that will enable develop employees who can effectively participate the teams' work will have to be designed and in this new environment. This means that current brought on line. potential team members must be trained and ac- Teams whose task environment requires a high climated to the virtual team environment. Addi- degree of informational integration and/or creative tionally, to fully exploit the virtual team's potential group participation are candidates for greater use for optimized membership, organizations must ex- of collaborative software applications, in addition tend their definition of human resources to include to DVCS. This collaborative software will benefit the broad range of consultants and contingent teams whose members must produce group docu- workers who may potentially participate on a team ments and presentations, interactively develop in only a virtual mode. and analyze data, or engage in complex team- Training and developing virtual team members level planning and decision making. System de- is in many ways no different from training and sign must also reflect an understanding that not developing good team members in general; devel- all teams need all systems; system design must be oping skills in communication, goal setting, plan- task-oriented in order to avoid unnecessary tech- ning, and task proficiency are all as important for nical overload of team members. The Xerox Corpo- the virtual team as for the traditional team. What is ration met this challenge when it connected two different about the virtual team is the amount of groups of scientists (one in Palo Alto, the other in technical training that is required to empower the Portland, Oregon) by arranging for constantly ac- team member to function in the virtual environ- tive phone, computer linking, and video conferenc- ment. Learning to use all of the traditional team ing between central areas in the two offices. The skills in an environment where most interactions two sets of scientists, although 500 miles apart, take place through a telecommunications medium could communicate with each other just as easily is a critical challenge. This is particularly true as if they were walking into the next room. No since technology continues to evolve and reinvent communication systems had to be operated; no itself at an ever-increasing rate. Training to main- complex protocols followed. Scientists simply tain technical proficiency will be an important walked up to the camera and started talking, or component of any virtual team member's continu- shared information back and forth through their ing education program. computer links. Scientists working on the project Since virtual team members' interactions may report that the richness of the communication sys- take place across a relatively alien set of telecom- tem significantly assists them in their work; be- munications systems, the first priority in virtual cause the system provides such high-quality com- team preparation is to effectively teach team mem- munication, users regard their communications bers how to fluently communicate with each other with long distance colleagues casually and indi- within the new media. Although team members cate that their geographical separation no longer can easily be taught to operate new technologies, inhibits their collaboration.28 they must be given an opportunity, through train- Teams whose task environment requires a high ing and team development, to establish their own degree of personal interaction may simply require slang terminology and communications protocols.

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Over time, the team will develop a variety of meth- fessional managers, the following four areas of ods to ensure that their communication is both potential resistance were consistently identified.29 efficient and accurate. When team flexibility is highly stressed, team Technophobia members will also require a very different attitude toward the team than would traditional team work- Although an increasing percentage of the work- ers. Traditional teams provide members with feel- force is computer-literate (and even computer-ori- ings of cohort and social presence; in an extremely ented), a significant number of valuable employ- flexible virtual team environment, employees will ees are uncomfortable with computers and other have to learn to join teams and accept new mem- telecommunications technologies. One of the bers into teams without the benefit of time-related greatest challenges in the introduction of virtual socialization. Thus, teams will benefit from learn- teams is the successful incorporation of valuable, ing to express explicit norms and role expectations technophobic personnel into the virtual team envi- to new members, who will in turn, be required to ronment. Part of this problem will be obviated as quickly acculturate according to the team's guide- both computer and telecommunications technolo- lines. It will be critical to the functionality of the gies become more user-friendly. The introduction virtual team that members are instilled with the of graphical operating systems (such as Microsoft same commitment to the virtual group activities as Windows 95) opened up computing to a number of they would to any traditional team function. new users, and similar introductions of simplified In addition to training and developing team re- operating systems, intuitive programs, and speech sources, human resources planners will have to recognition capabilities should encourage even identify potential team members from outside tra- the most technologically recalcitrant to use sophis- ditional organizational boundaries. As noted ear- ticated computer systems. In the meantime, orga- lier in the paper, the virtual team provides the nizations can more easily facilitate migration to opportunity to build teams out of personnel who the virtual team environment by providing training could not possibly work together under traditional and technical support specifically geared to sys- circumstances. If the potential of virtual teams is tem novices. fully realized, firms will have the opportunity to greatly expand access to expertise, overcoming constraints that might have been prohibitive in the Trust and Cohesion Issues past. Additionally, organizations will have to re- In an environment where one's primary interaction think how to compensate these individuals, whose with others takes place through an electronic me- contribution to a particular team may be less than dium, it is only natural to expect that participants full-time. will wonder whether the system is being used to Given the diversity of potential personnel avail- monitor and evaluate them. The free flow of team able to the virtual team and the potential fluidity of members' communication, which once might have team membership, organizations may want to con- taken place away from the office, may now be sider the development of team development spe- inhibited by concerns about privacy and system cialists. Team development specialists would security. To counter this problem, organizations function as resources to teams, assisting them with must establish clear policy regarding communica- technical problems and facilitating their interac- tions privacy, and must then strictly adhere to that tion when necessary. Providing this level of sup- policy. Over time, participants will realize that the port would allow the virtual team to focus more on virtual team system is a safe medium across which its objectives, rather than on the processes associ- to share ideas and concerns. ated with teamwork in the virtual environment.

Over time, participants will realize that Challenges and Obstacles the virtual team system is a safe medium Like any organizational innovation, the introduc- across which to share ideas and tion of virtual teams will encounter a number of concerns. challenges and obstacles. Virtual teams require organizational restructuring and the introduction of new work technologies. The potential for startup Burnout and Stress problems and deliberate resistance is substan- tially greater than for changes in structure or tech- One of the benefits of the virtual team environment nology alone. In discussing virtual teams with pro- is its ability to efficiently connect people and en-

This content downloaded from 129.186.176.218 on Mon, 24 Feb 2020 19:49:44 UTC All use subject to https://about.jstor.org/terms 28 Academy of Management Executive August able greater levels of productivity. This may result 2See Dess, G., Rasheed, A., McLaughlin, K. & Priem, R. 1995. in employees' being assigned to more teams, cre- The new corporate architecture. Academy of Management Ex- ecutive, 9 (3): 7-20; Davidow, W. H. & Malone, M. S. 1992. The ating a more complex and potentially stressful virtual organization. New York: Harper Collins; Byrne, J., Brandt, work environment. Organizations must be careful R. & Port, 0. 1993. The virtual corporation. Business Week, Feb- not to overextend virtual team members and sad- ruary 8: 98-102. dle them with levels of responsibility that they 3Ranney, J. & Deck, M. 1995. Making teams work: Lessons cannot reasonably satisfy. One important supervi- from the leaders in new product development. Planning Re- view, 23(4): 6-13; Lawler, E. 1992. Ultimate advantage. San Fran- sory role will be to ensure that virtual team mem- cisco: Jossey-Bass. bers have enough private time to complete their 4Townsend, A. M., DeMarie, S. M. & Hendrickson, A. R. 1996. individual assignments and prepare for their team Are you ready for virtual teams? HR Magazine, 41 (9): 122-126; participation. Pape, W. R. 1997. Group insurance: Virtual teams can quickly gather the knowledge of even far-flung staff. Inc. June 15: 29-30. 5 Bettis, R. & Hitt, M. The new competitive landscape. 1995. Structural Resistance Strategic Management Journal, 16 (S1): 7-19; Moore, J. 1996. The death of competition: Leadership and strategy in the age of The introduction of virtual teams will require sig- business ecosystems. New York: Harper Collins; Schrage, M. nificant amounts of organizational restructuring. 1995. No more teams! Mastering the dynamics of creative col- laboration. New York: Currency/Doubleday. Aside from the reasons detailed above, some resis- 6Bettis and M. Hitt, op. cit. tance will occur because organizational members 7Moore, op. cit. do not see this particular kind of change as desir- 8 Schrage, op. cit. able or necessary. To overcome their concerns, 9Yap, C., & Tng, H. 1990. Factors associated with attitudes management must carefully design an implemen- towards . Information and Management, 19 (4): 227-235. tation program that highlights the contribution 'o Hitt, M. A., Keats, B. W. & DeMarie, S. M. 1998. Navigating in that virtual teams will make and ties these contri- the new competitive landscape: Building strategic flexibility butions to important organizational values.30 and competitive advantage in the twenty-first century. Acad- emy of Management Executive, forthcoming. 11 Osterlund, J. 1997. Competence management by informat- Looking to the Future ics in R&D: The corporate level. IEEE Transactions on Engineer- ing Management, 44 (2): 135-145. The world of the virtual team is far from static; 12 Brookshaw, C. 1997. Virtual meeting solutions. Infoworld, continuing changes in technology and competitive 19 (22): 96-108. environments will present new opportunities and 13 Powell, D. 1996. Group communication. Communications of imperatives for virtual teamwork. Nicholas Negro- the ACM, 39 (4): 50-53. 14 Schrage, op cit. ponte writes, "Computers are getting smaller and 15 Townsend, A., Whitman, M. & Hendrickson, A. 1995. Com- smaller. You can expect to have on your wrist to- puter support system adds power to group processes. HR Mag- morrow what you have on your desk today, what azine, 40 (9): 87-91. filled a room yesterday."3' As telecommunication 16 Ibid. technologies continue to evolve, the virtual inter- 17 Verity, J. 1994. The information revolution, Business Week, Special Bonus Issue: 12-18. face will provide more realistic presence, while 8 Lucas, H. 1996. The T-form organization: Using technology simultaneously costing less and becoming easier to design organizations for the 21st century. San Francisco: Jos- to use. sey-Bass. Many of these same technological advances will 9 Kiesler, S. & Sproull, L. 1992. Group Decision Making and create more virtual interaction in workers' private Communication Technology. Organizational Behavior and Hu- man Decision Processes, 52 (1): 96-123; Siegel, J., Dubrovsky, V., lives as well. This change will increase employee Kiesler, S. & McGuire, T. 1986. Group processes in computer- expectation of working in a virtual mode; as an mediated communication. Organizational Behavior and Human increasing number of people socialize and shop in Decision Processes, 37 (1): 157-187. cyberspace, these same virtually-savvy people 20 Dubrovsky, V., Kiesler, S. & Sethna, B. 1991. The equaliza- will be expecting a similar experience in their tion phenomenon: Status effects in computer-mediated and face-to-face decision-making groups. Human-Computer Inter- workplace. The economic imperative for virtual action, 6 (1): 119-146; Finholt, T. & Sproull, L. 1990. Electronic teams, combined with changing societal experi- groups at work. Organization Science, 1: 41-64. ence of the virtual, may well transform the virtual 21 Mantovani, G. 1994. Is computer-mediated communication team from an innovative source of competitive ad- intrinsically apt to enhance democracy in organizations? Hu- vantage into a dominant organizational form. man Relations, 47 (1): 45-62. 22 Scott, K. D. & Townsend, A. M. 1994. Teams: Why some succeed and others fail. HR Magazine, 39 (8): 62-67. Endnotes 23 Alavi, M. 1991. Group decision support systems: A key to business team productivity. Journal of Information Systems 1 Grove, A. S. 1995. A high-tech CEO updates his views on Management, 8 (3): 36-41; Jessup, L. M. & Kukalis, S. 1990. Better managing and careers. Fortune, September 18: 229-230. planning using group support systems. Long Range Planning,

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23 (3): 100-105; McCartt, A. T. & Rohrbaugh, J. 1989. Evaluating Vegas. He earned his PhD in organizational behavior and hu- group decision support system effectiveness: A performance man resources from Virginia Tech. Townsend's research inter- study of decision conferencing. Decision Support Systems, 5 (2): ests include law and policy, and teamwork and 243-253. technology. His research has been published in such journals 24 Jessup, L. M., Connolly, T. & Galegher, J. 1990. The effects of as The Journal of International Business Studies, The Journal of anonymity on GDSS group process with an idea-generating Computer Information Systems, Labor Law Journal, HR Maga- task. MIS Quarterly, 14: 313-321; Jessup, L. M. & Tansik, D. A. zine, The National Review, and Communications of the ACM. 1991. Decision making in an automated environment: The ef- fects of anonymity and proximity with a group decision support Samuel M. DeMarie is an assistant professor of management system. Decision Sciences, 22: 266-279. in the College of Business at the University of Nevada, Las 25 Schrage, op cit. Vegas. He earned his PhD in strategic management from 26 Grenier, R. & Metes, G. 1995. Going virtual: Moving your Arizona State University. His current research focuses on new organization into the twenty-first century. Upper Saddle River, forms of organization, restructuring, downsizing, and the ef- NJ: Prentice Hall. fects of new technologies on the workplace. His research has 27 Lucas, op cit. been published in such journals as the Academy of Manage- 28 Schrage, op cit. ment Review, Academy of Management Executive, Organiza- 29 For a more in-depth discussion of the challenges of imple- tional Dynamics, HR Magazine, and The Journal of Computer menting change, see Academy of Management Executive 8 (4), Information Systems. 1994, special issue on restructuring, reengineering, and right- sizing. Anthony R. Hendrickson is an assistant professor of manage- 30 Reger, R. K., Mullane, J. V., Gustafson, L. T., & DeMarie, ment at Iowa State University. He received his PhD in computer S. M. 1994. Creating earthquakes to change organizational information systems and quantitative analysis from the Univer- mindsets. Academy of Management Executive, 8 (4): 31-46. sity of Arkansas. His current research interests are in telecom- 31 Negroponte, N. 1995. Being digital. New York: Alfred A. munications, virtual teams and teleconferencing, information Knopf. system usage, information systems psychometrics, and object- oriented technologies. His research has been published in such About the Authors journals as MIS Quarterly, Decision Sciences, Academy of Man- agement Executive, The Journal of Computer Information Sys- Anthony M. Townsend is an assistant professor of management tems, DATA BASE, Journal of International Information Manage- in the College of Business at the University of Nevada, Las ment, and Ethics and Critical Thinking Quarterly.

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