Acmdemy ol ManagemenI Execulive, 2DO0, Vol. 14. No.

Managing a virtual workplace

Wayne F. Cascio

Executive Overview
Virtual workplaces, in which employees operate remotely from each other and iiom
managers, are a Teality, and will become even more common in the future. There are
sound business reasons for establishing virtual workplaces, but their advantages may be
offset by such factors as setup and maintenance costs, loss of cost efficiencies, cultural
clashes, isolation, and lack of trust Virtual teams and telework are examples of such
arrangements, but they are not appropriate for all jobs, all employees, or all managers.
To be miost effective in these environments, managers need to do two things well: Shift
from a focus on time to a focus on results: and recognize that virtual workplaces, instead
of needing fewer managers, require better supervisory skills among existing managers.
Taking these steps can lead to stunning improvements in productivity, profits, and
customer service.

The virtual workplace, in which employees oper- but for better supervisory skills among existing
ate remotely from each other and from managers, managers.
is a reality for many employers now, and all indi- This article identifies the business reasons for,
cations are that it will become even more preva- as well as some potential arguments against, vir-
lent in the future. Virtual organizations are multi- tual workplaces; examines alternative forms of vir-
site, multiorganizational, and dynamic' At a tual workplaces, along with the advantages and
macro level, a virtual organization consists of a disadvantages of each; and provides tools and in-
grouping of businesses, consultants, and contrac- formation to managers of virtual workplaces,
tors that have joined in an alliance to exploit com- based on advances in research on this topic.
plementary skills in pursuing common strategic
objectives.2 The objectives often focus on a specific Business Reasons for Virtual Workplaces
project.^ In and of itsell, this grouping represents a
dramatic change in how we work, and it presents Many companies have instituted virtual work-
two new challenges for managers. The challenges places, and have reaped the following benefits:
stem from the physical separation of workers and • Reduced real estate expenses. IBM saves 40 to 60
managers wrought by such iniormation-age ar- percent per site annually by eliminating offices
rangements as telework and virtual teams. "How for all employees except those who truly need
can I manage them if I can't see them?" is a ques- them.^ Northern Telecom estimates the savings
tion that many managers are now asking. It de- gained from not having to house an employee in
fines the first managerial challenge of the virtual a typical 64-square-foot space, considering only
workplace: making the transition from managing rent and annual operating costs, at $2,000 per
time (activity-based) to managing projects (results- person per year.^ Others estimate the savings at
based). $2 for every $1 invested.''
The second managerial challenge of the virtual • Increased productivity. Internal IBM studies
workplace is to overcome uncertainty about show gains of 15 to 40 percent. USWest reported
whether managers will still be valued by their that the productivity of its teleworking employ-
companies if they are managing employees who ees increased, some by as much as 40 percent.^
are not physically present. In one case, a first-level • Higher profits. Hewlett-Packard doubled reve-
manager recalled his boss coming out of his office, nue per salesperson after moving its sales peo-
looking at the empty cubicles around him, and ple to virtual workplace arrangements.^
saying, "What do I need you for?"'* As we shall see • Improved customer service. Andersen Consult-
in this article, the need is not for fewer managers. ing found that its consultants spent 25 percent
81
82 Academy of Management Executive August'

more time face-to-face with customers when remote locations; and a way to track the location
they did not have permanent offices.'f' of mobile workers. Technology is the remote
• Access to global markets. John Brown Engineers worker's lifeline. In the absence of the adminis-
& Constructors Ltd., a member of the engineer- trative and technical support that one might find
ing division of Trafalgar House, the world's third at the home office, the technology must work
largest engineering and construction organiza- flawlessly, and technical support should be
tion, with 21,000 employees around the globe, available 24 hours a day, seven days a week. (Or
was able to access local pharmaceutical engi- at least a help desk should be staffed from 8 a.m.
neering talent at a project site in India. Using to midnight.) Decision makers need to consider
virtual work arrangements, the firm was able to the incremental costs associated with setting up
traverse national boundaries, enabling it to and maintaining virtual workplaces.
work with and present a local face to its global
clients. This enhanced its global competitive- • Loss of cost eificlencles. When expensive equip-
ness.'' ment or services are concentrated in one loca-
tion, multiple users can access them. When the
• Environmental benefits. At Georgia Power, 150 same equipment or services are distributed
people, or 13 percent of the workers at headquar- across locations, cost efficiencies may be lost.
ters, are teleworkers. This has reduced annual For example, in the securities industry, certain
commuting mileage by 993,000 miles, and auto-
real-time information sources are necessary.
mobile emissions by almost 35,000 pounds.'^ A
Most stock quotes are available on the Internet
U. S. government study showed that if 20,000
federal workers could telecommute just one day on a 15-minute delay, which is adequate for
a week, they would save over two million com- most people's needs. However, for brokers and
muting miles, 102,000 gallons of gasoline, and traders quoting prices to customers, it is imper-
81,600 pounds of carbon dioxide emissions each ative that quotes be up-to-the-second. Compa-
week. The emissions savings for one week under nies such as Bloomberg, Bridge Financial Sys-
this arrangement are equivalent to the amount tem, Reuters Quotron, and ILX Systems provide
of carbon dioxide produced by the average car this real-time service. Each is willing to install
over 9.3 years.'^ its system at the customer's place of choice. Typ-
ical costs are about $1,200 per month for the first
installation of such a system, and about $200 per
A U, S. government study showed that if month to install each additional system in the
same location. When a securities firm needs this
20,000 federal workers could telecommute information for 50 brokers, along with related
just one day a week, they would save services (e.g., CDA Spectrum, Multex.com's Mar-
over two million commuting miles, ket Guide, and First Call/Thomson Financial), it
102.000 gallons of gasoline, and 81,600 is more cost-effective to have all employees at
pounds of carbon dioxide emissions each one location, rather than working at many dif-
week. ferent locations.'^ /
• Cultural issues. Virtual organizations operating
in the global arena often have to transfer their
Potential Disadvantages of Virtual Workplaces business policies and cultures to work with dis-
persed business teams across collaborating or-
Offsetting these advantages, however, are some
ganizations, geography, and cultures. This can
potentially serious disadvantages that managers
lead to potential clashes of business and na-
should consider carefully before institutionalizing
virtual-work arrangements: tional cultures, which, in turn, can undermine
the entire alliance.'^ If the members of a virtual
• Setup and maintenance costs. For individual organization or a virtual team are not empow-
employees, the additional cost required to equip ered to make decisions, the technology that en-
a mobile or home office varies from roughly ables their collaboration will add little value,
$3,000 to $5,000, plus about $1,000 in upgrades and the competitive advantage associated with
and supplies every year thereafter.'^ In addition, rapid responses to demands in the market place
to be viable, virtual offices require online mate- will be lost.
rials that can be downloaded and printed; data- • Feelings of isolation. Some level of social inter-
bases on products and customers that are acces- action with supervisors and coworkers is essen-
sible from remote locations; well-indexed, tial in almost all jobs. Without it, workers feel
automated, central files that are accessible from isolated and out of the loop with respect to cru-
-2000 Cascio 83

cial communications and contact with decision motivated self-starters who know their jobs well
makers who can make or break their careers. and are technically self-sufficient, the key is to
• Lack of trust. A key ingredient to the success of work with them well ahead of planned transitions.
virtual work arrangements is trust that one's Firms such as Lotus, IBM, and Hewlett-Packard
coworkers will fulfill their obligations and be- have written guidelines, training, and networks of
have predictably. Lack of trust can undermine peers to facilitate the transition. For example,
every other precaution taken to ensure success- Hewlett-Packard's guidelines for virtual work-
ful virtual work arrangements, such as careful places address topics such as who can participate,
selection of employees to work in the virtual family and household issues, remote office setup,
environment, thorough training of managers and administrative processes.
and employees, and ongoing performance man- Just as not all employees are suited to work
agement. away from their primary business locations during
scheduled work hours, not all managers are suited
to manage employees with virtual-work arrange-
// fhe uiembeTS of a virtual organization ments. Those who are seem to have the following
or a virtual team are nof empowered to characteristics:
make decisions, the technology that
• An open, positive attitude that focuses on solu-
enables their collaboration will add little tions to issues rather than on reasons to discon-
value, and the competitive advantage tinue virtual-work arrangements.
associated with rapid responses to • A results-oriented management style. Those
demands in the market place will be lost. who need structure and control are unlikely to
be effective managers in virtual-work environ-
ments.
When Virtual Work Arrangements are • Effective communications skills, both formal
Appropriate and informal, with employees working remotely
and at the primary business location.
Virtual workplaces are not appropriate for all jobs. • An ability to delegate effectively, and to follow
In fact, an organization must first understand the up to ensure that work is accomplished.
parameters of each job it considers for a virtual
work environment. To do so, it must determine While these characteristics apply to progressive
what function the job serves; if the work is per- managers in conventional as well as virtual-work
formed over the phone, in person, via computer, or environments, the need is greater in virtual envi-
in some combination; how much time the em- ronments that lack the attributes of traditional so-
ployee spends in direct contact with other employ- cial contexts, such as physical proximity, verbal
ees, customers, and business contacts; if the loca- and nonverbal cues, norms of behavior, and, in the
tion of the office is critical to performance; whether case of teams, a sense of cohort.
the hours have to be 9 to 5; and whether the em-
ployee must be reachable immediately.'"'
lobs in sales, marketing, project engineering, Virtual Teams
and consulting seem to be best suited for virtual
In a virtual team, members are dispersed geo-
workplaces because individuals in these jobs al-
graphically or organizationally. Their primary in-
ready work with their clients by phone or at the
teraction is through some combination of elec-
clients' premises. Such jobs are service- and
tronic communication systems. They may never
knowledge-oriented, dynamic, and evolve accord-
meet in the traditional sense. Further, team mem-
ing to customer requirements.'^ Even in these jobs,
bership is often fluid, evolving according to chang-
however, virtual work arrangements are not rec-
ing task requirements.'^ Such an arrangement pro-
ommended for new employees or those who are
vides several advantages:
new to a position. Newcomers require a period of
socialization during which they learn to adapt to • It saves time, travel expenses, and provides ac-
their new company, new environment, and new cess to experts.
managers and coworkers. They need time to learn • Teams can be organized whether or not mem-
business skills, how and why things are done in bers are in proximity to one another.
the new company or new position, and the dos and • Firms can use outside consultants without incur-
taboos of the company's culture. ring expenses for travel, lodging, and downtime.
For employees whose jobs are appropriate for • Virtual teams allow firms to expand their poten-
virtual work arrangements, and who are internally tial labor markets, enabling them to hire and
84 Academy of Management Executive August -

retain the best people regardless of their physi- es—introducing themselves and providing some
cal location, or, in the case of workers with dis- personal background—before focusing on the
abilities, whether or not they are able to com- work at hand. Second, they set clear roles for
mute to work. each team member, thus enabling all team mem-
• Employees can more easily accommodate both bers to identify with one another. Third, all team
personal and professional lives. members demonstrated positive attitudes. Team
• Dynamic team membership allows people to members consistently displayed eagerness, enthu-
move from one project to another. siasm, and an intense action orientation in all of
• Employees can be assigned to multiple, concur- their messages.^o The lessons from this research
rent teams. are that first impressions are critical, and that es-
• Team communications and work reports are pecially in virtual-work environments, initial mes-
available online to facilitate swift responses to sages need to be handled well. Keep the tone of all
the demands of a global market. For example, messages upbeat and action-oriented. One pessi-
Veriphone uses a so-called relay race to develop mist in the group has the potential to undermine
software products faster than its competitors. trust in the entire virtual team, and lack of trust
Software engineers at the firm's Dallas head- affects overall group productivity. Not surprisingly,
quarters work a full day on a project, then put low-trust teams were less productive than high-
their work product online on the company's in- trust ones.
tranet. Veriphone engineers in Honolulu take up
the project, then post it for their counterparts in
Bombay. As the Bombay software engineers Training Members and Managers of Virtual
leave work, they transmit their work product Teams
electronically back to headquarters in Dallas,
Because virtual teams are growing in popularity, it
where the originators are arriving for the next
is important to address the issue of how best to
day's work. Electronic communications media
train members and managers of virtual teams. A
make the relay race possible. Clients benefit
majority of U. S. corporations use some form of
from the firm's speedy response to their needs.
team structure in their organizations.^' Virtual
teams add another layer of complexity to any
teamwork situation. They have created a rich
Disadvantages of Virtual Teams training agenda, for example:
The major disadvantages of virtual teams are the • How to use the software to enhance team perfor-
lack of physical interaction—^with its associated mance.
verbal and nonverbal cues—and the synergies • How to manage the anonymous environment,
that often accompany face-to-face communication. and when to use it.
These deficiencies raise issues of trust. Trust is • How to provide anonymous participation and
critical in a virtual team because traditional social feedback when ideas or criticism need to be
control based on authority gives way to self-direc- brought out. This is particularly important since
tion and self-control. Members of virtual teams the traditional cues of social interaction—body
need to be sure that all others will fulfill their language and hand gestures—may not be avail-
obligations and behave in a consistent, predict- able.
able manner.
• Social protocol for virtual teams.
• Since changes in team membership must occur
The major disadvantages of virtual teams with seamless continuity, it is important to teach
are the lack of physical interaction—with common cultural values.
its associated verbal and nonverbal These issues imply that managers should think
cues—and the synergies that often carefully about the kinds of behaviors that are
accompany face-to-face communication. most likely to enhance a virtual team's ability
to function effectively. Empirical findings with
global virtual teams suggest that these behaviors
An empirical analysis of the development of fall into three key areas: virtual-collaborative
trust in 29 global virtual teams that communi- skills, virtual-socialization skills, and virtual-
cated strictly by e-mail over a six-week period communication skills.22
found that teams with the highest levels of trust Key virtual-collaboration behaviors include the
tended to share three traits. First, they began ability to exchange ideas without criticism, de-
their interactions with a series of social messag- velop a working document in which team mem-
-200O Cascio 85

bers' ideas are summarized, exchange it among nally, they should provide honest feedback to
team members for editing, track member com- group members about their individual behaviors
ments in a working document with initials, agree and the final outcome of the team's work. Doing so
on activities, and meet deadlines. may uncover unproductive behaviors that will en-
Key virtual-socialization behaviors include the able group members to work better the next time
ability to communicate with other team members around.
immediately, solicit team members' feedback on
the process the team is using to accomplish its
tasks, disclose appropriate personal information,
express appreciation for ideas and completed Teleworking
tasks, apologize for mistakes, volunteer for roles, Telework is work carried out in a location remote
and acknowledge role assignments. from central offices or production facilities,
Key virtual-communication behaviors include where the worker has no personal contact with
the ability to obtain local translator help when coworkers, but is able to communicate with them
language skills are insufficient to be understood, electronically.2^ Teleworking is a popular and
rephrase unclear sentences so that all team mem- rapidly growing alternative to the traditional,
bers understand what is being said, use e-mail office-bound work style. Two of every three For-
typography to communicate emotion, acknowl- tune 500 companies employ teleworkers. Forty
edge the receipt of messages, and respond within million employees telework on a global basis,
one business day. and by 2003 more than 137 million workers world-
There is also much to learn from other research wide are expected to telework at least on a part-
on teams in general, especially with respect to time basis.2^ Survey results indicate that employ-
self-limiting behaviors by team members.^3 Team ees want more opportunities for telework, and
members may limit their involvement for any one that their top priority is to gain the flexibility to
of the following reasons: the presence of someone control their own time.^' Some companies are
with expertise, the presentation of a compelling actively encouraging the trend. In February,
argument, lack of confidence in one's ability to
2000, both Ford Motor Company and Delta Air
contribute, an unimportant or meaningless deci-
Lines announced that they are giving employees
sion, pressures from others to conform to the team's
decision, or a dysfunctional decision-making cli- personal computers for home use.^s
mate in which members become frustrated, indif- Telework may also assume other forms:
ferent, unorganized, or unwilling to commit to mak-
ing an effective decision. • Hoteling: Ernst & Young workers in Washington,
D. C , use workstations and meeting rooms in
To avoid these problems, managers should
nearby hotels. The firm has hoteled eight offices
choose team members carefully and give each
and is converting seven more, and has found
member a good reason for being on the team. They
should also frame the team's decision task appro- that workers focus less on the office and more on
priately, emphasizing clear, well-defined goals the customer.29
and the consequences of the team's decision. The • Hot desking: About 20,000 IBM employees, pri-
first team meeting is crucial and will establish marily those in sales and service, share offices
lasting precedents for the team. Managers should with four other people, on average. Cisco Sys-
set productive team norms, for example, and clar- tems, a technology firm in San Jose, California,
ify whether decisions will be made by consensus has several thousand people sharing a variety
of spaces around the world. As noted earlier,
however, hoteling and hot desking are not for
The first team meeting is crucial and will everyone .^"^
establish lasting precedents for the team. • Telework centers: Corporate office environments
in miniature, offering more technology than an
employee has at home, may be located in resi-
and whether all team members will share respon- dential neighborhoods. Small groups of employ-
sibility for implementing the final decision. Man- ees who live nearby work in these centers,
agers should also monitor the team's process. If rather than commute. For example, the Ontario
this proves difficult, they should include a team- Telebusiness Work Center near Los Angeles of-
development specialist to serve as a resource to fers electronically equipped suites to compa-
the team, assisting it with technical problems, and nies.3' The suburban location minimizes com-
facilitating their interaction when necessary.2'' Fi- muting time, while maximizing productive time.
86 Academy of Management Executive August-

Telework and the balance hetween work and ness, and identify what the barriers to teleworking
family will be. This alleviates managers' concerns and
Although there is little empirical research on the focuses attention on areas that need to be ad-
effect of telework on work-family relations, a re- dressed. Formalized training for telework is di-
cent study in three Canadian organizations re- vided into teleworker training, supervisor and
vealed that teleworkers had significantly lower manager training, and team training, in which
levels of interference from work to family, signifi- teleworkers and their managers come together to
cantly lower levels of interference from family to discuss issues that affect their relationship. Some
work, and significantly fewer problems managing organizations also set aside time to train and ed-
their family time than they did before telework- ucate the entire staff, from the mail room to the
ing.^2 These data support the positive view of tele- board room.^^ •
work and suggest that working from home helps In teleworking arrangements, cultural, manage-
employed parents balance work and family de- rial, and interpersonal implications also need to
mands. ^^ be addressed. Training for workers and managers
should begin together so they hear the same mes-
sage, and understand the business case for imple-
Implications of telework research for decision menting telework arrangements. Both groups ad-
makers dress such issues as the lack of face-to-face time
(which may create resentment among workers who
Decision makers should be skeptical of claims about remain in the office), potential losses in creativity
the effects of telework that are not grounded in rig- from lack of personal interaction with coworkers
orous empirical research. For example, several stud- and managers, and potential losses in productivity
ies have suggested that the level of teleworking par- from absence from the office. Employees and man-
ticipation will have a negative impact on visibility, agers who already have experience with telework
and, therefore on career advancement.^^ But empiri- arrangements should make presentations. Both
cal research has not addressed this out-of-sight, out- groups should be encouraged to begin measuring
of-mind argument. Before drawing conclusions productivity through assignments and projects,
about telework and framing organizational policy on rather than hours spent in the office.^'^
this issue, decision makers should also consider the
extent to which research findings might apply to Project management is especially important in
their own industries and organizational cultures, instances where teleworkers or virtual members
and to employees at different stages of their careers. are not part of the same organization. Each person
is hired to accomplish a specific task, and that
person often has no vested interest in monitoring
Training managers and employees for telework the end result. If a manager does not actively mon-
itor the progress of the overall project and the
In a telework relationship, time is not important.
usefulness of the final product, the team's produc-
This is one of the harder lessons for managers of
tivity will never result in improved profitability.
teleworkers to learn, and many have to rethink
completely how they view supervision. They need The time frame for completion can cause prob-
to understand that managing employees they can't lems for some managers who are new at managing
see differs considerably from walking around of- teleworkers or virtual teams. Most managers es-
fices to see that employees are at their desks. tablish completion dates, which are necessary.
Learning to make the transition from managing However, completion of a project may be delayed if
time to managing projects is critical and will de- managers do not establish milestone activities,
termine the success of an organization's telework critical completion points within the overall dura-
program.^^ tion of a project. Through the use of milestones, a
manager can see early in a project's life cycle
whether or not the necessary pieces are progress-
Learning fo make the transition from ing satisfactorily. This allows corrections and
managing time to managing projects is changes during the project that ensure timely com-
critical and will determine the success of pletion, or at least forewarn of problems.^^ The
principles of effective project management are not
an organization's telework program. new, and they do not change in virtual work envi-
ronments. They simply become more important.
Before a telework arrangement is finalized at Managers and workers should be wary of naive
Merrill Lynch, process consultants study how em- expectations about what working away from the
ployees in a given area communicate and do busi- office is really like. To provide a realistic preview
'2000 Cascio 87

for prospective teleworkers, Merrill Lynch uses a cation sessions. For example, use e-mail for re-
simulation lab, a large room with work stations ports, and the computer-based chat room to
where employees work for two weeks without face- discuss project issues. In addition, all team mem-
to-face contact with their managers. After the two- bers should be available by phone between cer-
week trial, some employees decide that telework is tain hours.^2
not for them.^^ While some firms use short, self- Scheduled virtual meetings are essential and
scored surveys to help workers identify how likely attendance must be enforced strictly to ensure that
they are to succeed as teleworkers, there is really all team members participate. Face-to-face meet-
no substitute for a job tryout, such as a simulation ings on a regular basis, if at all possible, allow
lab provides. team members to put faces to e-mail. Forging per-
A final component of telework training is to sonal relationships among team members contrib-
bring managers into the evaluation process about utes to successful implementation. Since facial
six months after the implementation of the tele- expressions and body language cues are not avail-
work program, using productivity measurements able in the virtual work environment, teleworkers
as the basis for a business case analysis. Examin- must compensate with other forms of communica-
ing the impact of telework on productivity, cost, tion in order to understand each other fully. This
and customer satisfaction allows for adjustments generally means asking more questions and con-
or enhancements to the program, or to its cancel- versing more frequently. The manager or team
lation. leader should communicate with all team mem-
bers, not just a few, and include all team members
on distribution lists. This ensures that all members
Virtual Office Challenges for Managers are accounted for and are equal contributors to the
It is important at the outset to ensure that all de- team. Regular updates and status reports are nec-
partments that will interact with members of vir- essary to replace hallway conversations, network-
tual teams or teleworkers accept and support the ing, and the daily stimulation of a traditional office
concept of the virtual-work arrangement. If they do environment.
not, it will fail.^o As the vice chairman of American
Express noted: "It's important to have a multifunc-
tion team of senior managers promoting and sup- Scheduled virtual meetings are essential
porting a virtual-office initiative from the start. We and attendance must be enforced strictly
had three departments involved in our effort: HR, to ensure that all team members
technology, and real estate. The individuals must participate.
be enthusiastic and not unnecessarily fettered by
traditional approaches. And they must be made
knowledgeable about all the key issues."" When team members do not work at the same
Broad support alone is not enough to guarantee time, or in the same location, members themselves
the success of virtual workplaces. Managers also must make exceptional efforts to ensure accurate,
must set and enforce ground rules for communica- timely communications. Some virtual teams must
tion, and institute a comprehensive process of per- contend with different time zones. Others must dis-
formance management. seminate detailed information, perhaps on spread-
sheets or by using computer-aided design (CAD)
software. Managers can provide guidance and
Communication coaching on how to improve communications, but
Communication is a major challenge for managers team members themselves have to shoulder re-
implementing a virtual-work environment. Many sponsibility for providing accurate, timely infor-
managers have to learn new communication skills mation.
to prevent team members from feeling isolated and
not part of a larger group. It is important not to rely
solely on e-mail, which is one-way communication. Performance management
Managers should learn how to conduct effective By far the biggest challenge is performance man-
audio meetings, and to balance e-mail, voice mail, agement, which requires that managers do three
video conferencing, and face-to-face communica- things well: define, facilitate, and encourage per-
tions. formance.'*^ While these principles are important to
Begin with some ground rules so that all team follow in conventional working environments, they
members understand the method of communica- are even more imperative in virtual working envi-
tion and what is expected during those communi- ronments.
 Academy oi Management Executive

Define peifoimance back to remote employees helps ensure that there

On a virtual team, a fundamental requirement is won't be.
that all team members understand their responsi-
bilities.'''' A manager trying to define performance Facilitate perfonnance
might ask the following questions to help clarify
these responsibilities: Managers who are committed to managing remote
workers effectively recognize that two of their ma-
• What is the team's overall objective? jor responsibilities are to eliminate roadblocks to
• Do you expect each team member to fulfill more successful performance and to provide adequate
than one role on the team? resources to get a job done right and on time.
• Which responsibilities will team members share Obstacles that can inhibit maximum perfor-
(e.g., selecting new members, rating one anoth- mance include outdated equipment or technology,
er's performance}? delays in receiving critical information, and inef-
• Will the team elect a leader? What responsibil- ficient design of work processes. Employees are
ities will this person have? well aware of these, and are usually willing to
• Who is responsible for disciplinary action if the identify them when managers ask for their input.
need arises? Then it is the manager's job to eliminate these
• How will the team make decisions (e.g., by con- obstacles.
sensus, or by majority-rule)? Adequate capital resources, material resources,
• Which decisions does the team have the author- and human resources are necessary if remote
ity to make? workers or members of virtual teams are to reach
the challenging goals they have set. In the words
The next step is to develop specific, challenging of one observer, "It's immoral not to give people
goals, measures of the extent to which goals have tools to meet tough goals.""^ Conversely, employ-
been accomplished, and assessment mechanisms ees really appreciate their employer's providing
so that workers and managers can stay focused on everything they need to perform well. Not surpris-
what really counts. To be useful, the measures ingly, they usually do perform well under those
should be linked to the strategic direction, busi- circumstances.
ness objectives, and customer requirements for the
company.*^ For a cable-television company, a ma-
jor strategic thrust might be to increase the number Encourage performance
of new subscribers, or the number of current sub-
scribers who pay for premium channels. For a firm To encourage performance, especially repeated
that provides outsourcing services in information good performance, it is important to provide suffi-
technology, major customer requirements might be cient rewards that employees really value, in a
timeliness of response to inquiries, and cost sav- timely and fair manner.
ings relative to in-house capability. Begin by asking remote workers what's most im-
portant to them. For example, is it pay, benefits,
In defining performance, regular assessment of
free time, technology upgrades, or opportunities
progress toward goals focuses the attention and
for professional development? Then consider tai-
efforts of an employee or team. A manager who
loring your awards program so that remote work-
identifies measurable goals, but then fails to as-
ers or teams can choose from a menu of similarly
sess progress towards them, is asking for trouble.
valued options.
Next, provide rewards in a timely manner, soon
A manager who identifies measurable after major accomplishments. For example. North
goals, but then fails to assess progress American Tool & Die, a metal-stamping plant in
towards them, is asking for trouble. San Leandro, California, provides monthly cash
awards for creativity. This is important, for an
excessive delay between effective performance
The overall objective of goals, measures, and and receipt of the reward may mean the reward
assessment is to leave no doubt in the minds of loses its potential to motivate subsequent high
remote workers what is expected of them, how it performance.
will be measured, and where they stand at any Finally, provide rewards in a manner that em-
given point in time. The need for such ground rules ployees consider fair. Procedures are fair to the
is even more pressing in a virtual work environ- extent that they are consistent across persons and
ment. There should be no surprises in the perfor- over time, free from bias, based on accurate infor-
mance management process, and regular feed- mation, correctable, and based on prevailing
2000 Cascio 89

moral and ethical standards.^'' Not surprisingly, Endnotes

employees often behave very responsibly when ' Snow, C. C, Lipnack, J., & Stamps, J. 1999. The virtual orga-
they are asked In advance for their opinions about nization: Promises and payoffs, large and small. In C. L. Cooper
what is fair. Indeed, it seems only fair to ask them. & D. M. Rousseau (Eds.), The virtual organization: 15-30. New
York: Wiley.
^ Dess, G. G., Rasheed, A. M. A., McLaughlin, K, J., & Priem,
R. L. 1995. The new corporate architecture. The Academy of
Implications for Managers Management Executive, 9(3):7-18.
^M. Igbaria & M. Tan (Eds.). 1998. The viitual workplace.
New business realities, coupled with demands by Hershey. PA: Idea Group Publishing.
workers for more flexibility and empowerment, ^ Grensing-Pophal. L. 1999. Training supervisors to manage
suggest that virtual workplaces are here to stay. teleworkers. HRMagazine, January, 67:72.
The challenges of managing a virtual workplace ^ O'Connell, S. E. 1996. The virtual workplace moves at warp
will escalate in scope. The use of new technology speed. HFtMagazine. March 51:77. See also: Business Week. 1996.
and tools only enables competitive advantage. Re- The new workplace. April 29:105-113.
^ Cooper, R. C. 1997. Telecommuting: The good, the bad, and
alizing competitive advantage requires effective the particulars. Supervision. 57(2):10-12.
management coupled with new ways of doing 'McCune, J. C. 1998. Telecommuting revisited. Management
business. Organizations in which virtual-work ar- Review. 87:10-16.
rangements thrive will be flatter than they are ^Matthes. K. 1992. Telecommuting: Balancing business and
today. Knowledge workers within these environ- employee needs. HE Focus, 69(3)December: 3.
ments will have more autonomy and responsibility ^ O'Connell, op. cit.
'° Ibid.
than in traditional organizations, yet lines of au- '' Grlmshaw, D. J., & Kwok, F. T. S. 1998. The business benefits
thority, roles, and responsibilities will still need to of the virtual organization. In Igbaria & Tan (Eds.), op. cit., 45-70.
be defined clearly. New ways of communicating '^ McCune, op. cit.
and interacting among workers in virtual environ- '^ The Green Commuter. http:llUbeitynet.oTglcleanairlgreenl
ments will need to be developed and implemented, summei38lgTeentext8-98.html.
yet face-to-face communications will remain es- '•* Clark, K. 1997. Home is where the work is. Fortune. Novem-
sential ingredients of successful workplaces. ber 24:219-221.
'^ Arko, D. et al. 1999. Virtual teams. Unpublished manuscript.
Heavy emphasis will be placed on establishing University ol Colorado Executive MBA Program, Denver.
and maintaining the technical tools that are the '^Serapio, M. G., Jr., & Cascio, W. F. 1996. End-games in
lifeblood of workers in virtual environments. Work- international alliances. The Academy of Management Execu-
ers as well as managers will need continual train- tive. 10{]):62-73. See also Cascio, W. F., & Serapio, M. G. Jr. 1991.
ing in both new tools and new processes to operate Human resource systems in an international alliance: The un-
effectively in these environments. doing of a done deal? Organizational Dynamics, Winter:63-74,
" Apgar, M.. IV. 1998. The alternative workplace: Changing
where and how people work. Harvard Business Review. May-
June:121-136.
Organizations in which virtual-work '^ Townsend, A. M., DeMarie. S. M., & Hendrickson, A. R. 1998.
Virtual teams: Technology and the workplace of the future. The
arrangements thrive will be flatter than Academy of Management Executive, 12(3):17-29.
they are today. '^ Ibid.
''" Coutu, D. 1998. Trust in virtual teams. Harvard Business
fleview, May-June:20-21. See also larvenpaa, S. L., Knoll, K., &
Managers who are committed to virtual-work en- Leidner, D. E. 1998. Is anybody out there? Antecedents oi trust in
global virtual teams, journal of Management Information Sys-
vironments will understand that basic principles tems, U(4):29-64.
of management are not different in virtual-work ^' Townsend et al., op. cit.
environments, but that the principles need to be ^^ Knoll, K., & Jarvenpaa, S. L. 1998. Working together in
followed more closely than ever. They understand global virtual teams. In Igbaria & Tan (Eds.), op. cit.:2-23.
that better, not fewer, management skills and man- ^^Mulvey, P. W., Veiga, J. F.. & Elsass, P. M. 1996. When
agers will be needed. teammates raise a white flag. The Academy of Management
Executive. 10(l):40-49.
To be a beneficiary, rather than a victim, of ^* Townsend et al., op. cit.
emerging virtual-workplace trends, institute the ^^ Gupla, Y., Karimi, J., & Somers, T. M. 1995. Telecommuting:
performance-management systems, information- Problems associated with communications technologies and
access capabilities, and training systems to de- their capabilities. IEEE Transactions on Engineering Manage-
velop skills that will be important in the future. ment. 42(4):305-318.
Always look ahead; learn from the past, but don't ^^ Anderson, C. Girard, ]., Payne, S., Pultz. J., Zboray, M.. &
Smith, C. 1998. Implementing a successful remote access project:
live in it. By embracing these emerging changes in From feciinoJogy (o management. New York: Gartner Group,
the world of work, proactive managers can lead Report R-06-8639, Nov. 18.
change, not just react to it. " The new world oi work: Flexibility is the watchword. 2000.
90 Academy oi Management Executive

Business Week. January 10:36. See also Conlin, M. 1999. 9 to 5 *^ Cascio, W. F. 1998. Managing human resources: Productiv-
isn't woiking anymore. Business Week, September 20:94-98. ity, qualify ol work Uie. proiits (5"" ed.). Burr Ridge, IL: Irwin/
^^ Rivenbark, L. 2000. Employees want more opportunities to McGraw-Hill. See also Cascio, W. F. 1996. Managing for maxi-
telecommute, report reveals. HBNews. April:14-16. mum performance. HBMonthly (Australia), September: 10-13.
^^ Business Week. 1996. op. cit. *^ Townsend et al., op. cit.
^ "Oifice Hoteling" isn't as inn as futurists once thought. *^ Moravec, M. 1996. Bringing performance management out
1997. The Wall Street Journal September 2:A1. of the stone age. Management Review. February:38-42.
^' O'Connell, S. E.. op. cit. ^^ Kerr, S. in Sherman, S. 1995. Stretch goals: The dark side oi
^^ Duxbury, L., Higgins, C. & Neuield. D. 1998. Telework and asking for miracles. Fortune. November 13:31.
the balance between work and family: Is telewoik part oi the ^' Greenberg. J. 1987. Reactions to procedural justice in pay-
problem or part of the solution? In Igbaria & Tan (Eds.) op. cit.:
ment distributions: Do the means justify the ends? journai oi
218-255.
Applied Psychology. 72:55-61.
33 Ibid.
^* Austin, J. 1993. Telecommuting success depends on reengi-
neering the work processes. Computing Canada, 19:37-38. See
also DuBrin, A. J., & Barnard. J. C. 1993. What telecommuters like
h
and dislike about their jobs. Business Forum, 18:13-17. See also
Dutton, G. 1994. Can California change its corporate culture? Wayne F. Cascio is a profes-
Management Heview. 83:49-54. sor of management at the
3^ Grensing-Pophal, op. cit. University of Colorado at
3^ Ibid. Denver. His research on staff-
3' Grensing-Pophal, L. 1998. Training employees to telecom- ing, training, performance
mute: A recipe for success. HHMagazine, Dec:76-82. management, and (he eco-
'^" Arka et al., op. cit. nomic impact of HR activities
^^ Grensing-Pophal, op. cit. has appeared in a number of
*" Anderson, C. 1998. The top 10 non-technical reasons tele- scholarly journals. He has au-
commuting programs fail. New York: Gartner Group, Report thored or edited six texts in
COM-C4-043I, March 25. HR management, and has
^' Apgar, op, cit.:125. consulted with more than 150
^'Telecommuting: Practical option or management night- firms. Contact: wcascio@
mare? http://www.eeicom/eye/telecomm.html. carbon.cuden ver.edu.