Slashing Costs, Not Innovation: How a Virtual Team Can Benefit Your Business

Show the average business leader a popular workforce model, you’ll see a team running its company 24 hrs a day with little overhead. How is that possible? Thanks to technology, virtual teams are making a boom in business — while keeping their costs low. Managing those you cannot see face-to-face presents a whole host of challenges, but a new model of effective  leadership.

“There is a trend toward more organizations being open to utilizing virtual teams in order to cut costs, gaining access to a wider and more dynamic talent pool and preserving productivity while downsizing human resources,” says Chronos Consulting in their current research, The State of Virtual Team Utilization In The 21st Century: A research study by Chronos Consulting (TSVTU). Chronos Consulting is a niche consulting firm that specializes in human capital to meet business objectives in the areas of HR, downsizing, leadership development, operation functions and IT.

Blackenterprise.com examined the study by Chronos Consulting to explore the risks of leading virtual teams, the benefits and how to effectively lead them.

After contacting more than 1700 companies for the survey study, Chronos Consulting received 83 completed surveys with more than 500 employees who expressed their thoughts on the virtual workforce. If you want to talk benefits, 72% of companies cited “cost reduction as the primary reason for using virtual teams.”

BENEFITS:

Low Cost: “Implementing a virtual team model can have a number of benefits, including the ability of a company to reduce costs, cut travel and expenses, gain access to a more efficient labor pool and produce better collaboration between software and tools,” stated Chronos Consulting in the survey study.

Increase happy points: The study cited, “Virtual employees are typically more amenable to working more often, which can help accommodate workload fluctuations. Having employees work virtually on projects with increased global risk can create a better work/life balance.”

No more revolving door syndrome: It can get pretty expensive training employees that don’t fare well with the company– only to decide  to let them go. It’s expensive in time and money.  Chronos Consulting’s study says, “Employees who are more content are likely to stay with a company for a longer period of time. Because labor costs make up a large portion of the operating budget for many organizations, reducing turnover can lower operational expenses.”

RISKS AND CHALLENGES

Time zone issues: While arranging  a teleconference with teammates in Ottawa at 9 a.m. EST may not pose as an issue, could you imagine doing the same for your virtual team in Frankfurt, Germany 9 a.m. CET the same day? You’ll be burning more than just the midnight oil.

Training: The same strategies  that project managers use for training a traditional workforce, may not always work for a virtual workforce. Because of this,  a new technique must be developed and this takes time.

Lost in translation: Miscommunication and failure to act are common fears when leading a virtual team. The study reports, “Virtual teams require project managers, team members  and executives to consider new ways to communicate and work in the absence of face-to-face interaction.” It went on to reinforce, “Successful virtual team building requires strategic and holistic talent utilization, as well as a shared vision for achieving desired  business and project goals.” If a technique of communication is not outlined or expressed beforehand, it can cause a lot of problems along the way.