Difference between Virtual Organization and Traditional Organization

Virtual Teams

A virtual team is a group of people who work for a common purpose but in separate locations. The concept of the virtual team has been introduced with the enhancement of technology. In these teams, people perform jobs in a virtual work environment created and maintained through IT and software technologies. The virtual team concept is relatively new to project management areas and IT. Most of the processes are outsourced in a virtual work environment. Since virtual team solely rely on electronic communication media, they work in different time zones and a variety of cultural boundaries. More diversified team members may work in a virtual team.

Virtual team management includes the following:

• Training: Team leader sets targets and develops the team member until he meets the standard level.
• Assembling: Probation periods are the measurable indicator to be applied when commencing with remote teamwork organization.
• Managing: Use of telecommunication technologies to manage ongoing projects and jobs of remote group members.
• Controlling: Team leader establishes performance indicators to evaluate the performance of team members.

Traditional Teams

A traditional team, also known as an intact team, is a functional team in which experts work together and share a common path to achieve their team’s processes and goals. In some cases, traditional teams are an entire department. Leadership is undertaken by a senior-level manager. New recruitments to the team are based on their technical skills and competency. Traditional teams mostly engage in described routine jobs.

Organization Structure: Compared to the traditional teams, virtual teams support flatter organization structure with dim lines of authorities and hierarchies. This is required to survive in hypercompetitive market, deliver results faster and encourage creativity which are actually the primary objectives for forming a virtual team.

Selection of Team Members: In case of traditional teams, members are largely selected based on their functional skills. But performing in a virtual team environment is not easy for everyone. Lack of face-to-face interactions and social focus in a virtual setting might lead to isolation and loneliness. It calls for managing ambiguity, proactive networking, exceptional time management and work discipline, ability to learn new technologies, and the ability to collaborate across functional and cultural boundaries. So, in the selection of a virtual team member, there is a need to look into these core competencies in addition to the basic functional skills.

Accountability

In a team-based organization, team members are accountable to each other, and to the team as a whole. This mutual accountability means that the entire team is responsible for its collective actions. This is the opposite of accountability at an individual level inherent in traditional organizations.

Although there are times when teams could have collectively performed better, lack of effort and accountability are rarely intentional. According to a February 2020 Harvard Business Review article, a team’s underperformance is most likely due to limited resources, ambiguity regarding roles, a poor strategy and/or unrealistic goals.

Leadership Style: In virtual team setting, managers cannot physically control the day-to-day activities and monitor each team members’ activities, therefore they need to delegate little more as compared to traditional teams. The command-and-control leadership style of yester years is giving way to the more democratic and coaching style of today.

Relationship Building: When traditional team members meet in the workplace every day they tend to develop close social ties with each other. They strike rapport with each other when they interact face-to-face. In the virtual team the interactions are tend to be more task-focused. Further, lack of verbal cues and gestures in virtual setting does not allow any scope for personal touch in the communication.

Psychological Contract: The foundation of psychological contract is more fragile in the virtual environment. Smaller instances of misunderstanding or gaps in communication result in violation of the psychological contract which has negative effects on the team’s effectiveness. Virtual teams also experience difficulties in building trust, cohesion and commitment among its members.

Knowledge Exchange & Decision-taking: Many a times in traditional teams, information is being exchanged during informal discussions. But in case of virtual teams, members have a very limited or no informal access to the information. Hence there is a need for more frequent updates on project status and building a shared database to provide all the important information to the team. Considering the time zone differences in global virtual teams, it becomes difficult to schedule meetings. Thus, in case of virtual teams many a times delay occurs in fixing a problem or reaching a consensus, whereas in traditional teams a meeting can be called at any time of the day when all the members are present together in the office, resulting quick decisions and problem solving.