Virtual teams and organizations

What are they? What do they look and feel like? Are you part of one? and Why does it matter?

In this three part series, I will:

  • look at the definition of a virtual team or organization,
  • review the benefits and challenges of virtual teams,
  • review best practices for setting up a successful team, and
  • explore at how we can measure the success of a virtual organization.

If you are part of a virtual team or organization, have you encountered similar challenges? do you feel you and your work benefit from the structure?

Virtual teams are becoming more and more common as our work environment and organizational expectations evolve, and supporting technology provides more options and flexibility. In addition, changing markets and the increasing global reach of even common products and services warrants a different approach to business. Including the rethinking of time and location.

Dannay Consulting, as it develops and delivers applications and services to our clients, operates in most cases as a virtual organization. Likewise, we are often members of a virtual team in our delivery. A team that encompasses other consultants and multiple representatives from our client’s organization. Kathryn Dannay has consulted to organizations to assist in developing best practices for virtual teams and has presented on this topic at conferences. This series of articles, outlines the high level take-a-ways from her research and her experience.

Definitions – Are you part of a Virtual Organization?

Before we start, we need to set up a common understanding of a virtual organization. For this series of posts, we will define a virtual team or organization as one that encompasses a group of individuals:

  • that are networked together as a cohesive unit to provide a product or service (e.g., a customer service group or a software development team),
  • who leverage technology to share ideas, skills and experience to accomplish an objective, and
  • who are not restricted by time or location.

We can refine our definition by saying that a virtual organization is one that:

  • is ongoing (no defined start or end point),
  • may or may not have one or more projects, and
  • has individuals that retain the same role within the organization.

While a virtual project team is one that:

  • has a defined start and end point with a specific outcome,
  • has individuals that may change from project to project,
  • has individuals that may work on more than one project at any given time, and
  • has individuals that may have a project role as well as an organizational role


Now that we have defined and clarified a virtual “project team” vs. a virtual organization, what are the benefits to the individual and to the larger organization?

From a business or organizational perspective, benefits may include:

  • a potentially wider pool of employees and/or resources. No longer is it necessary to only hire those within commuting distance of a physical location. Organizations can draw specialists nationally or even globally to participate in business idea development and execution.
  • increased business flexibility. With individuals working from multiple locations that may be in multiple time zones, business responsiveness and coverage can increase significantly.
  • improved employee retention. Many individuals who have more control over their work day, environment and structure increase their quality of life and contentment with their work.
  • lower infrastructure costs. This is especially true if resources are working from their own location and managing their own business needs (e.g., workspace, desk, internet, computer, phone, printing)

For an employee or individual, benefits often include:

  • Better quality of life. In most cases, individuals spend less time commuting, decrease their work related expenses (e.g., car, gas, parking, public transportation), and are given greater flexibility in the hours that are worked.
  • Higher level of satisfaction. This is due largely to having more control over the work that is done. In many cases, the employee has to step up and take more responsibility for each piece of work that is completed.
  • Greater accountability. Because an individual has to take more responsibility in the accomplishment of work, there is a greater sense of accountability and likewise satisfaction at the work’s completion.


Since a virtual organization, by our definition, is not bound by time or location our biggest challenge becomes that of “communication”. The complexity of the communication challenge increases with size of the organization. Simple math shows us how the complexity increases when the team size increases from 3 to 8 individuals.

Chart Illustrating How Communication Complexity Increases with the Size of the Team

How Communication Complexity Increases with the Size of the Team

We can take this communication challenge a step further when we realize that a large part of human communication is dependent on “Visual Cues”.

Dr. Albert Mehrabian, Professor Emeritus of Psychology, UCLA is best known for his 7%-38%-55% Rule that states:

  • 55% of communication is attributable to non-verbal behaviors like body language and facial expressions;
  • 38% of communication is attributable to voice including volume, tone, pitch, cadence, and quality; and only
  • 7% of communication is attributable to the words used.

Another way to view this is that the “written word” by itself (for most people) is the least effective way to communicate. Ah, but if as a virtual team we are not located together and potentially not even working at the same time, how do we overcome this challenge?

As this series develops, we will see that virtual organizations are not without their own challenges. Each organization, depending on the make-up of the individuals and the work being done, will also incur its own organizational specific challenges in addition to that of communication.


Do you have any benefits or challenges that you would like to share? I would enjoy hearing from you. Feel free to post a comment or contact me directly.