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Virtual Teaming: 10 Principles for Success
16 September 2002
Michael Bell, Ned Frey

Document Type:  Strategic Analysis Report
Note Number:  R-18-1032
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Learning how to lead and participate in virtual teams has become a fundamental imperative for surviving and succeeding in today's connected economy. To ensure that executives and knowledge workers are equipped to meet this challenge, they must focus on 10 key principles for virtual-team success.

Management Summary

Globalization and network connectivity are driving more enterprises to conduct work across time, space and cultural boundaries. This means that an increasing amount of the mission-critical work of the enterprise is being conducted in the context of the virtual team — a dispersed group of workers with shared purposes, accountabilities and work activities, who collaborate using technology-mediated communication systems and processes.

Virtual teaming is emerging as a powerful structure to leverage knowledge-based work by improving the speed, cost-effectiveness and coordination of work processes. It also helps ensure that projects are staffed with the diversity and competencies needed irrespective of geography, enhances innovation, and empowers team members with the authority and processes to work independently.

But virtual teaming is also fraught with pitfalls, which cause many enterprises' virtual-team efforts to fail. Many teams are dysfunctional and fail to achieve expectations and goals because of leadership failures, insufficient processes, mismatched tools, and risks associated with enterprise and geographical cultural barriers.

Fortunately, a set of best practices, protocols, processes and leadership techniques can be applied to overcome these challenges and ensure effective team performance. The enterprises that succeed with virtual teams are those that make explicit the team's relationships, methodologies and accountabilities. They focus on building sound methodologies and strong relationships among virtual-team constituents, recruit team members wisely, and provide tools that are well suited to the needs of the team.

Gartner has identified the following 10 principles for ensuring virtual team success:

This Strategic Analysis Report provides in-depth analysis of these success principles, and offers recommendations specific to each. It also illustrates these principles in action through case studies describing how two companies — Boeing-Rocketdyne and Royal Dutch/Shell — achieved success in high-profile projects conducted through virtual teams.

For managers and knowledge workers, learning how to lead and participate in virtual teams has become an imperative for surviving and succeeding in today's connected economy. Ensuring that they are equipped to meet this challenge means focusing on each of the 10 principles for virtual-team success.

Table of Contents

List of Figures

1.0     Introduction [return to Table of Contents]

Virtual teaming is rapidly becoming the fundamental work unit for knowledge-centric work in Global 2000 enterprises. Globalization and network connectivity are driving and enabling enterprises to coordinate work across time, space and cultural boundaries. By 2006, in 75 percent of enterprises, project teams will have virtual membership; in more than half of these enterprises, some project team members will be nonemployees (0.8 probability).

Organizations are revealing distinct work-style patterns governed by a collaborative culture and need for mobility (see Figure 1). Many are still fundamentally place-based and individualistic in work style. But many more are moving to a high-mobility style characteristic of field sales and service organizations. Another style is the "huddled" one, where employees work primarily in face-to-face meetings.

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Figure 1
Collaboration and Mobility Drive Virtual Teams

Figure 1. Collaboration and Mobility Drive Virtual Teams

Source: Gartner Research

But the trend is inexorably moving toward both a highly mobile and collaborative work style, where employees, customers, suppliers and other constituents work in the context of virtual teams. This is true even for people who work primarily in traditional work settings. They are working more and more through technology-mediated communication systems.

Many virtual teams, however, fail to achieve expectations and goals due to leadership failures, insufficient processes, mismatched tools and cultural barriers — both organizational and geographical. Fortunately, a set of best practices, protocols, processes and leadership techniques can be applied to overcome these pitfalls and achieve high-caliber team performance.

The role of virtual-team leader can emerge from a number of sources — from management, from functional leaders or from the peer group of the team. Thus, for most knowledge workers, learning how to lead and participate in virtual teams is now a fundamental imperative for surviving and succeeding in the connected economy.

Action Items: Most knowledge workers are likely to lead or be members of virtual teams. Be brutally honest about your virtual-teaming skills and improve them as necessary. Evaluate your work responsibilities in the context of managing them more effectively within a virtual team. Help your organization develop and learn about the principles of virtual-team success.

1.1     The Virtual Team Defined [return to Table of Contents]

A virtual team is first and foremost a team — a group of individuals with a common purpose, shared accountabilities, and interdependent work activities and deliverables. But as a virtual team, the group conducts most of its work across time and space boundaries.

This aspect of virtual collaboration is both the team's benefit and its bane. Working from a distance within technology-mediated communication systems doesn't change the fundamentals of team leadership and participation, but it profoundly changes how these fundamentals are implemented.

In a traditional, co-located work setting, many of the boundaries and cues of human interaction are both implicit and assumed:

In a virtual-team mode, however, all the components and support elements of teaming success must be rendered deliberately and explicitly. This is the essence of the success principles of effective virtual teaming — how deliberate, explicit and disciplined the team leader and members are in adopting the principles of effective teaming in the context of distant, technology-mediated collaboration.

Action Item: As a virtual-team leader, be explicit and deliberate in forming the team, communicating with its members, and establishing rigorous processes and protocols for virtual, collaborative interaction.

1.2     The Risks and Benefits of Virtual Teaming [return to Table of Contents]

Virtual teaming is becoming a mainstream practice, particularly for global enterprises that must collaborate across boundaries of time and space. But it is fraught with pitfalls that cannot be avoided unless fundamental principles are adopted by the team.

The benefits for many enterprises are compelling. Virtual teaming is emerging as a powerful structure to leverage knowledge-based work, for several reasons:

But virtual teaming is fraught with challenges. The single greatest risk to virtual team success is posed by cultural barriers within the global enterprise. These barriers include differing attitudes toward power and authority; differing beliefs and customs relating to individual vs. group-related work; and variations among different societies with regard to communication styles.

In addition, risks are posed by four main categories of virtual-team failure:

Action Item: Recognize the conflict between virtual teams and traditional hierarchical structures. Focus on building sound methodologies and strong relationships within the virtual team, recruit team members wisely and avoid complexity in the selection of tools.

2.0     Ten Principles for Virtual-Team Success [return to Table of Contents]

Strategic Planning Assumption: Through 2007, virtual-team leaders who adhere to the 10 success principles of virtual teams will improve team effectiveness by 50 percent (0.8 probability)

A growing knowledge pool exists on the subject of virtual-team leadership and support. The topic has received intense scrutiny by academics and consultants, and its popularity continues to grow. In the following sections, we distill Gartner's research on virtual teaming into 10 overarching principles for success:

In our research, we discovered several nuances about virtual teaming, which include:

In addition, it may come as no surprise to many that nine of the principles we've identified focus on people-related issues, while only one addresses technology. Collaborative technologies are crucial to effective virtual teaming and must be selected and applied wisely. However, technology cannot replace effective team leadership and processes, although it can enhance and support them.

The real secret to virtual-team success lies in developing a deep understanding of human psychology and behavior. Anyone who has led or participated in a virtual team knows that problems typically emerge —involving issues of communication, ambiguity, a loss of trust, and fears about meeting expectations and goals — when work is both interdependent and completed almost exclusively on an "out of sight" basis.

Thus, most of the success principles address issues of leadership, methodology and building an effective team culture. Virtual-team leaders and members must remember the overarching principle of virtual teaming: It's about people, not technology.

Action Item: As a virtual-team leader, focus on the people issues. Develop a strong sense of purpose, work diligently at building and sustaining an environment of trust, communicate consistently and often, and coach and mentor team members in strengthening their virtual-collaboration skills.

2.1     Leadership Imperatives [return to Table of Contents]

Leadership is the sine qua non of virtual teams. Paradoxically, this leadership typically shifts — and in some cases, is shared — during the life cycle of the virtual team. This is a major source of the effectiveness of virtual teams: that team members can change and share roles much like rugby players, whose roles often shift and change depending on who has the ball.

Despite the fluid nature of virtual-team leadership, those assuming the leadership role must be cognizant of two success factors: individual competencies and leadership priorities.

Competencies: Leading a virtual team requires a spectrum of leadership skills, perhaps the most important of which elicit positive and productive human behaviors. These include:

Also important are process, networking, change and project management skills. In addition, because technology plays such a key role virtual communication and collaboration, IT know-how is more of a factor than it is for nonvirtual team leadership.

Priorities: Leadership priorities focus on:

Other important priorities include consensus building, resource allocation, and securing executive sponsorship and support.

Many of these priorities and competencies, of course, are equally critical in traditional, nonvirtual leadership roles. What differentiates leadership in a virtual-team environment are three factors:

Virtual-team leaders must therefore be deliberate, explicit and disciplined in adapting their leadership styles to the crucial differences in virtual-team interaction, and be diligent in prioritizing and executing the team startup process.

Action Item: Virtual team leaders must adapt their leadership and management skills for the virtual team environment. This includes:

2.2     The Power of Purpose [return to Table of Contents]

Virtual teams must define a clear purpose that is aligned with enterprise goals and translated into individual responsibilities and tasks. Purpose, when clearly expressed and reflected by strong leaders, inspires ordinary people to do extraordinary things. It resonates, drives excellence, calls to people's spirit and connects them through a common bond.

Yet team leaders undervalue not only the need for purpose, but its power as well. Some mistake it for the immediate goal of a project, or are unable to convey a purpose large enough for others to step into. Some think that purpose is synonymous with financial metrics, others fail to recognize its fragility, and still others underestimate the vigilance with which they must keep purpose alive and resonating.

In the context of virtual teams, a well-articulated purpose is not only energizing but also mandatory. It bonds disparate and dispersed people — each contributing competence, interest, commitment and learning — and becomes the logical connective tissue in a work setting that lacks physical cues such as body language, functional titles, office locations and rank. In place of the physical cues and boundaries that serve as symbols in the traditional, nonvirtual environment, purpose brings focus and clarity to virtual team roles and serves as a compass for team direction and effort.

In other words, a well-crafted purpose helps team members understand their roles, their collective impact and how they will make a difference. It cascades down into the mission that defines team goals, which in turn devolve into the individual objectives that drive the specific, individual tasks that ultimately deliver results (see Figure 2). This is the fundamental value chain of a high-performance virtual team.

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Figure 2
The Cascading Chain From Purpose to Results

Figure 2. The Cascading Chain From Purpose to Results

Source: Gartner Research

Action Item: Define a clear and compelling purpose for the team's mission. Gain team consensus on, and commitment to, this purpose, and link it to enterprise goals and to individual roles, responsibilities and tasks.

2.3     The Trust Factor [return to Table of Contents]

Strategic Planning Assumption: Through 2007, virtual-team leaders who fail to build and sustain a trusting environment within the team will miss team goals by at least 50 percent (0.8 probability).

Perhaps the greatest threat to virtual teaming is a breakdown in trust among team members, and between the team and the enterprise it serves. Although trust is built slowly over time, it can be destroyed in a matter of minutes.

For example, virtual meetings that never start on time and fail to meet objectives will undermine trust, as will team leaders whose behavior conflicts with their stated intentions. Tools and technology that fail to meet stated performance standards will also fray the fabric of trust within the team.

The nature of virtual teams poses unique challenges to building and sustaining trust. These include:

It takes considerable time for people to build up a sense of trust in their colleagues and team leader. This same level of trust must be cultivated in the tools, processes and protocols that facilitate the team's collaboration and work output.

2.3.1     The Four Pillars of Trust

Research in virtual-workplace best practices reveals that four elements, if developed by the virtual-team leader and members, will reinforce a trusting environment within the team. Gartner calls these elements the "pillars of trust" in virtual teams:

2.3.2     Trust Success Factors

In the context of virtual teams, four success factors exist, each of which fosters one or more of the pillars of trust identified above (see Figure 3):

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Figure 3
Building Trust in Virtual Teams: Four Pillars, Four Success Factors

Figure 3. Building Trust in Virtual Teams: Four Pillars, Four Success Factors

Source: Gartner Research

These success factors represent the consensus of expert guidance on virtual-team leadership, as well as extensive interviews with virtual-team leaders. The overall goal is to ensure and reinforce a sense of confidence in team members toward each other, and toward team leadership, processes and tools.

Action Item: As a virtual-team leader, be explicit in building and sustaining a trusting environment in the team. Be consistent in your words and actions, and respectful of team members. Ensure that team members have the competence and discipline to deliver on their accountabilities. Insist on information transparency, and ensure that all team members have all relevant information, all the time.

2.4     The Startup Process [return to Table of Contents]

Strategic Planning Assumption: Through 2007, virtual teams that effectively execute the team startup process, will improve the likelihood of team success by 30 percent (0.8 probability).

The most important juncture for the virtual team is the initialization phase. A systematic, sequential startup process is essential for virtual team success. Whether the team is commissioned only to complete a specific assignment or to serve as an ongoing operational unit, the startup phase will set the tone, purpose and protocols that will guide the team's collaborative efforts throughout its life cycle.

Six steps lead to an effective virtual team startup process (see Figure 4).

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Figure 4
Initiating Virtual Teams: A Six-Step Process

Figure 4. Initiating Virtual Teams: A Six-Step Process

Source: Gartner Research

Action Item: As a virtual-team leader, institute a formal team startup process similar to the one described above. Establish a clear team purpose, recruit with diversity and competence in mind, establish team methodologies and protocols, and bring the team members together in an initial, face-to-face meeting.

2.5     Team Linkages: Staying Connected [return to Table of Contents]

Virtual teaming is 90 percent about people, and 10 percent about technology. Software and network connectivity may provide the basic links among team members, but staying connected goes far beyond technology. It takes people — both team leaders and members — to provide the methodologies and sustain the relationships that connect the virtual team.

For leaders, this means understanding and focusing on team methodologies, learning and relationship building as high-order elements in building team linkages. Team members, for their part, must understand the challenges they will face in staying connected, and the proactive steps needed to overcome them.

2.5.1     From Linkages to Relationships

In their book, "Virtual Teams: Reaching Across Space, Time, and Organizations With Technology," Jessica Lipnack and Jeffrey Stamps argue that the essence of virtual teams rests on three fundamentals: people, purpose and linkages. We have addressed the people and purpose factors earlier, but the concept of linkages is an important one for virtual-team leaders and participants to understand.

Linkages start with basic connectivity infrastructure and applications. Most virtual collaboration occurs through technology-enabled media such as e-mail, audioconferences and videoconferences, and through collaborative applications that provide knowledge repositories, work scheduling and task assignments (see Figure 5).

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Figure 5
Team Linkages — From Media to Relationships

Figure 5. Team Linkages — From Media to Relationships

Source: "Virtual Teams: Reaching Across Space, Time and Organizations With Technology," J. Lipnack and J. Stamps

But linkages should be considered in a broader context that moves from media, through various processes and learned behaviors such as team building, brainstorming and issue resolution, to the ultimate state of linkages: enduring relationships grounded in a sense of trust, commitment and accountability among team members. The success of a virtual team is ultimately measured by how well it builds relationships, both within the team and with other constituencies.

Lipnack and Stamps sum up linkages this way: "Links are physical media that enable interactions that spawn and maintain relationships." It is ultimately the quality of the relationships that are built within the team that will ensure its ability to meet or exceed its goals. High-performance virtual teams focus on methodologies and protocols that minimize ambiguity and enhance trust, resulting in highly effective and enduring relationships.

Action Item: Team leaders should not depend on software applications and connectivity alone to ensure adequate team connections. Leaders must also focus on team methodologies, learning and relationship building as crucial elements in building effective team linkages.

2.5.2     Helping Virtual Workers Stay Connected

Perhaps the greatest downside to a virtual work style is the problem of employee feelings of isolation and disconnection. When working remotely, even the most skilled and self-confident employees can experience a sense of organizational isolation and estrangement from the social fabric of the workgroup. They may feel "out of the loop," and vulnerable to missed opportunities to work on important assignments or to be eligible for promotion. They may also struggle to maintain the informal social networks that are so important in a knowledge-based organization.

Gartner has identified six steps that leaders and team members can take to address these challenges:

2.6     Communication Protocols [return to Table of Contents]

Effective and explicit communication protocols are the bedrock of high-performance virtual teams. Team leaders must ensure that the principles of effective distant communication are embedded in the team's communication process, including availability, context (synchronous, when possible) and sender prioritization.

Distant communication poses distinct challenges compared to face-to-face interaction. The latter is always synchronous, and those transmitting the communication control the exchange. The context of the communication is rich and explicit, and gesture and body language greatly amplify meaning, tone and intent. Distant communication, by contrast, is often asynchronous, and the receiver controls the exchange relative to when and where the communication is received. Context must always be re-established because gesture, tone and body language is lost.

How to overcome these challenges? Organization consultant Martha Haywood sets forth four rules for effective distant communication. These rules should be considered in the many communication modes that will be adopted by the team.

These rules should be put into the context of team expectations about individual accountability, personal communication styles and flexibility.

Particular protocols should be established for online team meetings, such as the meeting schedule, participants, agenda, and the capture and indexing of meeting minutes. Other protocols will need to be established, such as the use of e-mail vs. instant messaging, rules governing confidentiality, processes for review and critique, and processes for dispute resolution.

Action Item: Virtual-team leaders should establish explicit communication protocols that embody the four principles of effective distant communication — availability, context, synchronous communications (whenever possible) and the prioritization of messages.

2.7     The Operating Agreement [return to Table of Contents]

Strategic Planning Assumption: Through 2007, virtual-team leaders who codify practices and protocols in a team operating agreement will improve likelihood of team success by 20 percent (0.7 probability).

An important success factor in virtual teaming is the development of an operating agreement that codifies and explicates team practices, protocols, and "rules of engagement" with team members and other team constituents. The agreement should attempt to minimize, if not eliminate, ambiguity. The operating agreement is primarily useful for project teams, particularly those involving team members that are nonemployees such as consultants and suppliers. For many virtual teams, standard administrative procedures will cover many of these points.

Key elements of the operating agreement include

In some cases the operating agreement is forged before a virtual team is constituted and launched, as was the case for the Boeing-Rocketdyne team (see Section 3.1). Typically, however, the operating agreement is created by the team members themselves, and represents the team's consensus on how it will operate throughout its life cycle.

Action Item: Virtual-team leaders should complete a team operating agreement that makes explicit how the team will operate through the course of its life cycle, how it will communicate, the roles and responsibilities of its members, and its relationships with key constituents.

2.8     Team Culture [return to Table of Contents]

Strategic Planning Assumption: Through 2007, a primary indicator of virtual team success will be its ability to create and sustain a team culture that reflects a strong sense of purpose, trust, empowerment and accountability (0.8 probability).

Creating a virtual-team culture is like weaving a tapestry. Individual threads combine to create an overall cultural fabric, which guides and orients team members as they work together in cyberspace. Earlier, we focused on two of these key cultural threads:

In addition to purpose and trust, two other threads must be woven into the team cultural fabric:

Action Item: Virtual-team leaders must focus on clarity of purpose, insist on team empowerment, be explicit in building trust, and foster team member commitment and accountability as the cultural fabric of successful virtual teams. They must constantly emphasize and reinforce these values throughout the team life cycle.

2.9     Teams and Communities [return to Table of Contents]

Strategic Planning Assumption: Through 2007, global enterprises will explicitly adopt communities as a natural extension to virtual teams (0.7 probability).

Virtual team members need a companion organization that can replace the social networks and informal structures that typify the traditional face-to-face workplace. As virtual teaming increases as the primary "production zone" in the enterprise (see Figure 6), the "social zone" will shift to communities (see "Communities: Sociology Meets Technology," AV-13-8988, and "Communities: Broad-Reaching Business Value," COM-13-9032).

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Figure 6
Teams, Communities and Organizational Structures

Figure 6. Teams, Communities and Organizational Structures

Source: Gartner Research

Community participants may be people, enterprises or agents. Each derives its power from mutuality of goals, ongoing interaction and communication, and the permanence of the relationships among the participants.

Community dynamics are driven primarily by the human need to be connected, and the desire to achieve goals greater than our own reach. In any community, three characteristics are present:

Communities can form organically or they can be explicitly engineered to serve a particular business need. For example, Gartner sponsors research communities that develop research agendas, develop topics for special reports and exchange knowledge with other communities in the research organization. Work projects, such as special reports, are executed by virtual research teams, which include analysts, editors and Web technicians.

Action Item: Provide the infrastructure support for interest communities, as well as work communities to function in conjunction with virtual teams.

2.10     Tools and Technologies [return to Table of Contents]

None of today's or tomorrow's software solutions will reduce the need for effective leadership and processes, although promising trends exist in technologies that support and enable virtual teams and their leaders to conduct their work more effectively. During the next two years, Gartner believes the difficulty of choosing between bundled suites, portal frameworks and point solutions will be reduced as collaboration support functions are eventually componentized and delivered as Web services.

Today's collaborative applications, however, are a key enabler of effective virtual teaming. When their use is combined with effective leadership and processes, these applications provide crucial support for today's increasingly distributed and virtual enterprises. They must be selected and applied wisely, however, within the context of the four basic stages of the collaborative process.

2.10.1     The Four Stages of the Collaborative Process

Collaboration focused on a specific goal, like all interactions, follows a predictable process. Understanding this process can provide insight into the types of environments, contexts and tools needed during various stages of collaboration. This is particularly true for large, complex project collaboration

The collaborative process can be divided into four stages (see Figure 7).

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Figure 7
Collaboration Process Stages and Tools Required

Figure 7. Collaboration Process Stages and Tools Required

Source: Gartner Research

2.10.2     Matching Applications to Collaborative-Process Stages

Various types of collaborative tools provide valuable support for each of the four stages of the collaborative processes.

Many applications primarily associated one stage of the collaborative process can also support, to varying degrees, additional phases.

Action Item: Select applications based on their support for each of the four stages of the collaborative process.

2.10.3     The Collaborative Application Market

Different teams have different work patterns and support needs. Although the vendors represented in Gartner's Collaborative Application Magic Quadrant (see Figure 8) have products that are broadly similar in scope, they differ significantly in the details (see "Magic Quadrant: Team Collaboration Support," M-16-7340). Thus, all vendors included are worthy of consideration, and vendors in the "Leaders" quadrant are not necessarily the best fit for all requirements.

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Figure 8
Collaborative Application Magic Quadrant

Figure 8. Collaborative Application Magic Quadrant

Source: Gartner Research

3.0     Virtual-Team Principles in Action: Two Case Studies [return to Table of Contents]

To illustrate how many of the 10 principles discussed in this report have contributed to the success of real-world projects, the following sections provide case studies of two successful virtual-team initiatives.

3.1     Boeing-Rocketdyne [return to Table of Contents]

The Project — Design a New and Better Rocket Engine: Boeing-Rocketdyne, a Boeing subsidiary, formed a virtual team in the mid-1990s to develop a new thrust chamber for a liquid-fuel rocket engine. The team included eight members, two of which were sourced from two Rocketdyne supplier companies, Raytheon and MacNeal-Schwendler. The team called itself "SLICE" for "simple, low-cost, innovative concepts engine." The team's membership included the following roles:

Approach: The team worked over a 10-month period, with each member devoting 15 percent of his or her time to the project. In its approach, the team embraced several of the 10 virtual-team success principles, including:

Results: The project results were unprecedented. The team developed a design that:

3.2     Royal Dutch/Shell [return to Table of Contents]

The Project — Develop a Value-Based Management System: The Chemicals Division of Royal Dutch/Shell launched a virtual-team project in 2001 to develop a comprehensive value-based management system for the division. The team was sourced globally from a diverse group of 12 volunteers, including:

Approach: The team followed several best practices in developing and supporting the virtual team. The team leader described five of these best practices as critical success factors for the team's accomplishments:

Results: The team's accomplishments exceeded its original goals. These accomplishments included the following:

4.0     Summary and Recommendations [return to Table of Contents]

A major business trend is the inexorable move toward a highly mobile and collaborative work style, where employees, customers, suppliers and other constituents work in the context of virtual teams. Gartner expects that these teams will become the fundamental organizational structure for knowledge-focused work within the next four years.

For most managers and professionals, learning how to lead and participate in virtual teams is now a fundamental imperative for surviving and thriving in the connected economy. To succeed, leaders must make explicit the relationships, methodologies and accountabilities of their virtual teams. Gartner recommends that enterprise managers and virtual-team leaders focus on the following imperatives, which correspond to each of Gartner's 10 principles for virtual team success:

Appendix A:     Recommended Reading on Virtual Teams [return to Table of Contents]