Teams are the building blocks of most organizations. And since most people in teams work closely together, it makes sense to have most team members in the same geographic location. But more and more companies are beginning to organize projects that involve teams who are in dispersed locations, come from different cultural backgrounds and speak different languages.
Can this work? Most teams are dispersed at some level, even if it's just that people are across the hall from one another. Or most people in a team can be in one location but one or two members are in a different location.
Researchers Frank Siebdrat, Martin Hoegl and Holger Ernst studied 80 software development teams from 28 labs worldwide, including labs in Brazil, China, Denmark, France, Germany, India and the United States. The labs varied in size, employing between 20 and 5,500 software developers, and each team contained up to nine members.
To measure geographic distribution, the researchers had the team leaders describe each member's office location. They then calculated a dispersion index, taking into account the following factors: 1) the miles between team members, 2) the time zone differences, 3) the number of locations per team, 4) the percentage of isolated team members and 5) the unevenness of membership across sites.
To assess team performance, the researchers asked the managers to evaluate the teams with respect to effectiveness (including product quality, customer satisfaction and so on) and efficiency (including adhering to budget and time constraints).
It turns out that even the smallest degree of dispersion -- even people working on different floors of the same building -- can greatly affect the quality of collaboration, especially with respect to a team's efficiency.
This article is adapted from “How to Manage Virtual Teams,” by Frank Siebdrat, Martin Hoegl and Holger Ernst, which appeared in the Summer 2009 issue of MIT Sloan Management Review. The complete article is available at http://sloanreview.mit.edu/smr/.