Virtual Teams: Understanding the Definition, Importance, and Different Types

A virtual team comprises individuals who collaborate to accomplish a shared objective or aim, despite being based in distinct geographical regions or physical spaces. Nowadays, virtual teams have become a crucial element in prominent sectors like the Software/IT and Automobile industries.

In the Automobile industry, the various components required for assembling a vehicle are not produced in-house. Similarly, in the Software industry, different teams across different regions or countries are responsible for creating different parts of a software or mobile application. These teams are referred to as virtual teams.

Virtual teams are rapidly gaining popularity globally, and the term 'virtual' originates from the Greek word 'virtue,' which originally meant a morally good quality or trait. However, the meaning has evolved to represent a temporary simulation or extension via computer software. In this article, we will explore the reasons behind the rise of virtual teams and dive into the essential characteristics that define them.

Importance of virtual teams

With the rise of globalization and market competition, communication and networking technologies have advanced significantly. As a result, organizations now require greater flexibility in delivery times, which may or may not be beneficial to them. This is where virtual teams can play a crucial role.

Having employees work remotely from their current location can be advantageous as it eliminates the need for the organization to invest time and money in transit for every individual. This approach also allows for a diverse team across various time zones, resulting in continuous work and a greater likelihood of meeting deadlines, ultimately contributing to the growth of the organization. However, finding individuals with the desired skill set and knowledge for the job can sometimes be challenging.

Various companies started this in the late 90s, and they have generated some right amount of profits using this virtual team concept.

Types of virtual teams

1) Networked teams

A team of professionals with diverse areas of expertise collaborate to share their perspectives on standard solutions and generate innovative ideas to resolve specific issues. The team composition is flexible, allowing for the addition or removal of members as needed, with the option of bringing in individuals with complementary or contrasting skill sets to augment the existing workforce.

2) Parallel Teams

These kinds of virtual teams, typically from the same organization, are formed to come up with unique ways to solve a problem or come up with a process.

The formation of such teams is usually for a temporary duration, and the team members remain unchanged throughout, unlike networked organizations where team members can be altered based on the need.

3) Product development teams

The teams comprise individuals from diverse backgrounds and locations, each with their own unique skill set tailored to the designated task at hand. Tasks may range from product development to organizational processes, such as assembling a team of five specialists to create a new operating system.

4) Production teams

This team is made up of individuals who have the same area of expertise and are working on a specific project. Each team member is assigned a specific role and is expected to focus solely on the tasks associated with that role.

The output of each individual in the production team is combined together, and then it is served as the final output to the client.

5) Service teams

The team comprises members from diverse time zones, ensuring round-the-clock service to facilitate continuous growth of the organization. It is crucial to note that each member's work builds upon the previous one, as they cater to the products developed by the company.

6) Management teams

The members of these teams work on different corporate-level strategies.

This team has the authority to control several other organizations; that is, the basic idea is to assign the task to several organizations and report for the work done by them.

7) Action team

The team is formed to address the urgent issue at hand. They will work with utmost dedication until the problem is resolved, and the team will remain intact until then.

After successfully completing the task, the team will disband, and its members will be allocated to other groups for support.

How to Create a perfect Virtual Team

To build an effective virtual team, it is crucial to carefully select individuals who are suited for remote work and adept at working collaboratively. Additionally, dividing the workload appropriately among team members is key to ensuring productivity and success.

It will take some steps to follow for making perfect virtual teams. Let’s take a look at the levels.

1. Finding the perfect people

Look for individuals who possess emotional intelligence, strong communication skills, and the ability to work independently and cover for others if necessary. In a virtual team, cultural awareness and respect are even more crucial.

When assembling a virtual team, it is crucial for leaders to conduct behavioral interviews and administer personality tests to assess each member's qualities. It is also important to provide training to address any skill gaps and encourage peer coaching to tackle any challenges that may arise.

2. Deciding the size of the team

Opting for a small team size is crucial as it leads to superior product outcomes. Research indicates that employees tend to put in less effort when they feel like they are just a small cog in the wheel of production. Therefore, larger groups tend to yield subpar results compared to their smaller counterparts.

So when you are going for the team to keep in mind to create a small group, which will be sufficient for your work.

3. Deciding the roles

It is essential to assess the strengths and abilities of each team member in virtual teamwork to determine their roles effectively. Regular evaluation during daily work can help identify individuals who excel in particular areas, allowing for the delegation of tasks accordingly. Once strengths are recognized, roles can be assigned and allocated accordingly to ensure the optimal performance of the team.

You will also get a glance during the interview so that you can mark it a position before checking the work.

4. Building up the trust

Building trust among employees is crucial for any team to function effectively. This requires mutual respect and open communication. As a leader, it is important to encourage team members to share their backgrounds and life experiences, but only if they feel comfortable doing so. By fostering a culture of sharing and openness, team members can develop a stronger sense of trust and camaraderie.

Advantages of Virtual Teams

Fostering strong relationships among employees is crucial for effective communication and trust in the workplace. By doing so, it can lead to improved productivity and better output.

1. Ability to recruit the best man for the job

When searching for potential team members, it is advantageous to have a large number of applicants to select from in order to identify the most qualified candidate. Virtual teams have the added benefit of being able to draw from a vast pool of applicants without the limitation of location.

2. Minimal infrastructural requirements

A lot of capital can be saved by avoiding paying the lease for maintaining a large workspace, electricity, and computer equipment costs.

3. Lesser downtime

Since there is no need for the employees to travel to the workspace, a lot of time can be saved.

4. Low employment costs

Businesses who recruit virtual teams find it more affordable option compared to the in-house team working at a workplace.

5. It can cater to a varied demographic

There are no limitations on the target market for a product. It is possible for the production team to be situated in one location, while the marketing team operates in another region.

Disadvantages of virtual teams

1. Technical issues

Virtual teams mainly depend on the communication, and once the communication system is down, then it is hard to communicate to get the updates about the assigned work.

Sometimes work goes on hold because of these issues. Every individual will be working on their system so that system failure can delay the job as well.

2. Team bonding

Poor communication can lead to a lack of cohesion within a team. When team members are working remotely or in different locations, it can be challenging to get to know everyone and understand their personalities. This can result in strained relationships and disagreements that negatively impact the team's productivity.

3. Problems in managing teams

Lack of communication and less sincerity and even poor leadership skills cause this management problem.

Failing to provide constructive criticism on an employee's performance can result in a negative impact on the organization's productivity, as the employee may continue to underperform without any guidance or corrective measures.

Future of Virtual Teams

The base ground for the virtual team concept is the communication that constitutes to depend on the IT sector.

Nowadays, virtual teams are no longer exclusive to the information and technology sector. They have become increasingly popular across various industries such as construction, manufacturing, and semiconductor industries. Even big organizations like DELL and LG have jumped on board, utilizing virtual teams to enhance their productivity and competitiveness on a global scale. This opens up opportunities for individuals to work in a more flexible and remote environment.

Working remotely has opened up opportunities to work for companies situated far away from your location, and still earn a living. This arrangement benefits both parties, as companies can benefit from your skills and talent, while you can work from the comfort of your own home. With the rise of virtual collaboration tools, essential business functions like sales, research and development, and human resources can now be performed more effectively by remote teams than traditional physical teams, provided they are managed efficiently.

Final Thoughts on Virtual Teams!

Virtual teams can be either a boon or a bane, depending on how they are managed.

Effective management of virtual teams can result in high productivity and cost savings for your company. However, poor management can lead to misunderstandings, low morale, and negative impacts on work performance. To avoid such issues, it is crucial to select a leader who possesses strong leadership qualities and can effectively manage virtual teams.

Share your thoughts and experiences on the importance of virtual teams in achieving business success. Let us know in the comments section if you have been part of a virtual team before.