Virtual teams: Benefits, drawbacks, how to manage & more

by Andy Nguyen
virtual teams

Curious about virtual teams?

A virtual team is a remote group of people who use cloud-based communication tools, project management software, and more to perform their work.

While you can build virtual teams for specific projects, you can also have the entire company operating virtually.

In this article, we’ll cover what a virtual team is and its various types. Then, we’ll discuss why you need a virtual team and how to address its challenges. 

Finally, we’ll explore how you can build and manage a high-performing virtual team.

This virtual team guide contains:

(click on a link to jump to a specific section)

Let’s get started.

What is a virtual team?

A virtual team (also known as a geographically dispersed team) comprises people from various geographic locations who work together to achieve common goals.

Most virtual teams don’t meet face-to-face and use electronic communications like emails, instant messages, video calls, and more to stay in touch.

Trouble getting used to the idea of having virtual employees?

Our article on virtual employees could help you out.

You can have different types of virtual teams within a company, like:

  • Product development teams: formed by experts from different countries who collaborate to create a product.
  • Service teams: composed of support staff working in different time zones assisting global businesses.
  • Management teams: include managers of the same organization working to develop corporate strategies.
  • Parallel teams: have members who work to develop recommendations in a system or process.

Additionally, you can also have the entire company working as a virtual team. 

For example, an eCommerce business, a digital marketing agency, or a virtual assistant service doesn’t really need a brick-and-mortar office to operate. They’ll do just fine, or better, in a virtual environment!

However, the idea of running a virtual office without seeing your team members face-to-face can seem a little overwhelming or counterintuitive at first.

Don’t worry. 

Just go through our article on successful virtual office management for some handy tips.

Why you need a virtual team

Several businesses and knowledge workers across the United States have embraced remote work. And it’s not just a short-term solution to working during the COVID pandemic.

Virtual teams have been around for decades and are here to stay.

But why do you need a virtual team?

Here are five key benefits of building a virtual team:

  • Lower Infrastructure Costs
  • Improved Productivity
  • Access to Diverse Talent Pool
  • Better Work-Life Balance
  • Easy Business Scalability

Let’s look closer at each of these advantages and understand why they matter:

1. Lower infrastructure costs

In virtual teams, collaboration over tasks and projects happen via the internet

So you don’t need a physical office to work together.

This significantly reduces your infrastructure expenditure, so you can use these savings to compensate your employees better or grow your business.

2. Improved productivity

Everybody has their own work rhythm. 

Some work best at dawn, while others are power-packed at noon.

A virtual office gives your team members the freedom to work at their most productive hours, ensuring that they’re focused on the task at hand. This leads to a happier workforce and better results.

3. Access to diverse talent pool

Most businesses now operate globally, and you need brilliant people to meet those growing demands and competition.

Having a global virtual team means that you can hire from anywhere. It diversifies your talent pool and lets you hire qualified individuals from across the globe.

4. Better work-life balance

We spend a lot of time commuting to work — time you could spend with family, friends, or attend to other personal needs.

Remote working helps avoid the daily commute and lets you set the work schedule that works best for you. 

You can use your productive hours for tackling important tasks while doing personal errands during non-productive hours, leading to a better work-life balance.

5. Easy business scalability

If you want to scale up your brick-and-mortar business, you’ll have to find additional office space, local talent, and other resources.

With virtual teams, your team can perform their virtual work from anywhere

So it’s better suited for businesses that want to scale up rapidly.

Read more about these advantages in our comprehensive article on virtual team benefits.

What are the challenges of virtual teams?

virtual team training

Virtual teaming is excellent and can be a fantastic addition to your business. 

However, virtual team management requires you to tackle some unique challenges, like:

1. Communication hassles

Unlike a co located team where you can have face-to-face conversations at work, a distributed team doesn’t meet in person often. 

If your teams rely more on virtual communication like emails or instant messages, communications can be misunderstood or misinterpreted. 

This lack of effective communication can compromise your efforts to build trust within the team and hinder common knowledge sharing. 

A quick solution for this remote work challenge is to have well-established business processes and documentation. 

2. Technical issues

Remember, virtual teams rely on computers, communication tools, and the internet to work. 

So if any technical issue pops up, your virtual team could face workflow disruptions.

To avoid this, encourage your team to opt for stable internet connections, high-performing computers, and keep their communication apps updated. 

Even if something happens, they should alert their manager or team leader immediately.

3. Difficult to manage

Managing virtual teams can be tricky since your team members aren’t in the same room as you.

It isn’t easy to precisely know whether a remote team member is productive — which can be especially challenging in global projects. 

Check out the top 10 challenges of managing global virtual projects.

Since your team members could be in different time zones and be from diverse cultures, the leadership team must take the initiative to ensure optimum virtual teamwork.

Additionally, you’ll probably hit roadblocks as you try to track project or team performance, work with language barriers and cultural differences, and carry out project management duties.

Don’t worry. From setting standard work hours to using productivity tools, you have several solutions for these hassles. 

Learn how to navigate through major virtual project challenges with ease.

How to build and manage a high-performing virtual team

Virtual teams offer much flexibility and bring together talent from across the world. 

However, managing virtual teams might not be as straightforward as managing in-office, traditional teams.

That said, with the right strategies, a virtual team can outperform their in-office counterparts.

Here are five things you should pay attention to when forming and managing a virtual team:

  • Find The Right People
  • Build Collaborative Teams
  • Establish Business Systems And Processes
  • Leverage Communication Systems
  • Monitor Team Productivity

We’ll cover each of these steps in detail and discuss how to implement them at your virtual office:

1. Find the right people

Be it virtual or not, an organization is only as strong as its people. 

So it’s vital to find the right people to join your team. 

However, hiring virtual employees can be tricky. 

The company leadership must look for people with the right skills, attitude, emotional intelligence, and company culture fit. 

Most importantly, you need self-managed people who don’t require much oversight to get things done.

To hire a virtual employee, start by listing down your needs. 

Then transform it into a clear job description. 

After that, decide whether you’ll be hiring people directly or through a staffing agency. 

Once you’ve sourced candidates who match your requirements, let specific project managers or human resource personnel handle the interview and assign them a trial assignment. 

This way, you’ll know if the candidate is a good fit for your virtual team.

Check out our comprehensive guide on how to hire virtual employees for more details.

Once you’ve hired them, it’s essential to onboard new members the right way. 

You must help them: 

  • Set up the necessary IT equipment/software.
  • Understand company policies and procedures.
  • Get introduced to the team.
  • Train for their roles and more.

Chances are, you’ll miss out on a few things while onboarding your remote work employee.

Don’t worry. Our remote employee onboarding checklist has got you covered!

2. Create collaborative teams

Team members can’t drop by for face interactions in a virtual office or catch up for a quick chat. Moreover, not every virtual team member is available all the time.

While this could weaken team collaboration, you can create a high-performing and successful virtual team through a few simple steps.

Firstly, initiate team building activities at your virtual office. 

Virtual team building empowers your entire team to foster team dynamics and cohesion, making collaboration easy and natural.

Go through our article on virtual team building for some fun activities.

Additionally, encourage remote team members to collaborate through emails, instant messages, or video calls. It ensures that they don’t get stuck on a particular problem for too long and improves teamwork at your virtual workspace

This is particularly important in virtual customer service teams that operate globally — they need to collaborate and share knowledge extensively to address customers’ queries or complaints.


Learn more about why virtual collaboration is critical for customer service.

To improve collaboration, you can also set up daily or weekly virtual team meetings to touch base and track project progress. This way, you’ll know of any troubles your team members face, and you can address them quickly.

Moreover, team meetings also present a unique opportunity to appreciate and congratulate your team’s efforts and achievements.

Check out our 14 simple tips to conduct a successful virtual meeting in 2021.

3. Establish business processes

As team members work virtually, it can be hard for them to determine how things work at your company. 

For example, they may be confused about applying for leaves or when to follow-up with your leadership team about something.

So you must establish business systems and processes to effectively guide your team members in the virtual office’s day-to-day operations.

Additionally, remember to create comprehensive documents describing these systems and processes. This way, you needn’t waste time repeating the same things to multiple people.

It’s just one of the things effective virtual team leaders do.

For more such action items, go through our article on virtual leadership.

It’s also an excellent practice to organize regular meetings to highlight the company’s different 

processes and procedures. 

However, these meetings shouldn’t merely be one-sided.

Take the time to gather input from each virtual team member and understand what works or doesn’t work for them.

Not sure how to conduct these meetings?

Our article on running successful virtual meetings can surely be of assistance.

4. Leverage communication and workflow management software

Electronic communication systems form the foundation of virtual teams. 

Without them, you can’t ensure virtual team effectiveness over the long-term.

Communication systems help you with team collaboration, face-to-face conversations, and sharing project/task-related files.

While you must establish good communication guidelines, you also need to determine which tools your remote work team will be using.  

There are different types of team communication tools for you to choose from, like:

  • Video conferencing tools: use Zoom or Microsoft Teams to set up face-to-face meetings with your remote team to brainstorm, discuss, and review any project developments. 
  • Instant messaging tools: use Slack to send messages to your team members for quick clarifications and timely responses.
  • Project and team collaboration tools: get real-time updates on project progress and an overview of each remote employee’s work with tools like Trello and Asana
  • File storage and collaboration tools: use Google Drive or Dropbox to organize, access, and share company files quickly with your team or stakeholders.
  • Virtual whiteboard tools: display and manage your strategy plans or brainstorming ideas in one place with tools like Witeboard, Miro and Canva’s Online Whiteboard.

You’ll need to pick and choose from these sets of tools as per your virtual workplace requirements and budget.

But which tools should you choose?

You can start by looking at the top ten virtual team communication tools.

5. Manage team productivity

When working in a virtual environment, it can be tempting to slack off, especially if there’s no direct supervision.

Moreover, when your distributed team members could be thousands of miles away, how do you ensure if they’re focusing on their tasks?

Fortunately, that’s easy. All you have to do is use a productivity tracking tool like Time Doctor.

What’s Time Doctor?

Time Doctor Homepage

Time Doctor is a time tracking and productivity management tool used by large companies and small businesses to skyrocket team performance.

Time Doctor helps you:

  • Track how much time a virtual employee spends on a particular task.
  • Analyze employee productivity via various detailed reports.
  • Track web and app usage to ensure that team members don’t slack off.
  • Improve efficiency by highlighting significant barriers to team productivity.

And that’s not everything you can do to manage the productivity of your remote workers.

Check our article Remote employee management: How to avoid common pitfalls.

Finally, your team must be well-versed in using multiple communication tools and a suitable project management tool at work.

It’s up to you to help them master the different software they could be using in their routine duties.

Learn how to upskill your virtual team with our comprehensive guide.

Managing virtual employees can be challenging, and you could use all the help you can get.

Take a look at more strategies you can use to manage a high-performing virtual team.

Final thoughts

Virtual teams are popular because they offer lower infrastructure costs, a diverse talent pool, and a better work-life balance, among others.

And while the team members are geographically dispersed, they interact and collaborate through electronic means such as emails, instant messages, and video conferences.

However, to build and manage a leading virtual team, you’ll need to find the right people, build collaborative teams, establish business systems and processes, leverage communication systems, and manage team productivity.

Use the tips and software we covered here, and you’ll be able to lead a successful virtual team in no time.

View a free demo of Time Doctor

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