We deliver business support services to clients but we borrowed from manufacturing industry and developed production lines for services. 

In this flat world with high-speed internet connectivity, reliable voice communication and a plethora of low-cost yet reliable software tools, to manage a business virtually with a distributed, borderless, flexible, loosely-knit, interconnected workforce is viable.

The increasing penetration of broadband & decreasing costs of bandwidth make the case for virtualization of business processes stronger by the day. Virtualisation of business operations is a new paradigm to win a competitive edge in the near term and a must-have in the long-term.

A Virtual Business has a distributed work-force working in clusters in small offices and public kiosks or individually from homes. They are connected through Public, Private or Virtual Private communication networks with an array of tools and technologies to collaborate and work as a team. The advantages of a Virtual Businesses are greater access to talent (geography becomes irrelevant as physical proximity is not essential), lower cost of operations as underemployed people & resources are gainfully employed, flexibility of operations, and the ability to have a global workforce without the attendant costs. And society benefits as employment creation in non-urban & under-developed areas is enabled by virtualization. The reduction of the daily commute to work lessens the burden on public resources, especially transportation, saves precious productive time and reduces the physical and mental stress on people.

However, not all business processes can be virtualised, Depending on the nature of business some tasks are more amenable to virtualization. And there are several challenges in managing a virtual business - Confidentiality & Security, Workforce Motivation & Involvement, Training & Development, Quality & Reliability, and Project Management & Delivery Adherence. Though not insurmountable these challenges coupled with the change management issues associated with the paradigm-shift make the transition difficult.

In my experience of managing a virtual business for two years, I have made virtualization a success with appropriately designed systems & structures enabled by innovative use of tools & technology.

Structures & Systems

We use a mix of full-time, part-time, contract and freelance workers. Full-time part-time employees are paid a fixed salary. Some of them work in our office and others from their homes. The contract & freelancer workers are paid by piece-rate, hourly or on fixed cost basis. All core tasks are executed by full-time employees; they plan, coordinate, manage and ensure quality. The nature of employment will depend on the specific needs of the business; it is generally dependent on the skill & competence level, flexibility of operations, & time-sensitivity of operations and the confidentiality issues.

Integration of the team using a collaboration platform is vital for success. We use an online, hosted collaboration management tool with work-flow & project management modules. It has different levels of users with highly granulated access rights, task breakdown & assignation, setting up work-flow, status update, review and feedback, reporting, time & cost monitoring & file upload features.

We deliver business support services to clients but we borrowed from manufacturing industry and developed production lines for services. Before commencing a new project, the process plan is made with the tasks broken down by skills and mapped to resources followed by allocations based on resource availability. If the capacity available is inadequate we enhance it by increasing the work-hours for part-timers & contractors and also by enlisting freelancers. The key to success is the process plan which must be configured into the workflow module of the Collaboration Management System.

Training & Knowledge Sharing

When I founded the company, I started with the belief that Training & Development in a virtual company would be more difficult than in a traditional environment and put in place a system of institutionalizing learning that training has turned out to be relatively easier. All the tasks performed are done on a computer recorded using screen-casting, and reusable systems and procedures modules are developed. We can do voice-over in English & regional languages with which anyone could get to speed quickly. We use virtual classrooms for imparting training; a group of individuals can attend a live training session from anywhere through the internet. On-the-job training is facilitated by desk-top sharing in conjunction with instant messaging tools.

We also use forums & message boards (general and also project specific) for the team members to exchange information and clarify issues easily.

Delivery Adherence

Delivery adherence is potentially the biggest problem in a virtual environment. Due to a combination of human as well as technological factors, deadlines can slip and it is important to work with greater factors of safety than in a traditional businesses. As the risk of default increases exponentially with the number of hand-offs, in a virtual environment, tight deadlines are unlikely to be met for complex processes with a high number of hand-offs. So, the delivery schedule has a significant impact on the process planning and the work-flow which need to be engineered dynamically according to the business needs.

Quality Assurance & Reliability

Quality Assurance by itself is not any different in a virtual business. Since variability increases the risk to quality, if one uses a large pool of employees for varied tasks (like we do), Quality Assurance requires additional focus. Also, it is not always possible to define the measurable standards for each stage in a services assembly line especially if the portfolio of services keep varying by the day. We manage this by appropriate checking at every hand-off and also by deploying better quality, more experienced people closer to the final stages of the delivery cycle. Referenceable models & samples for each stage of every activity is very useful. For bigger projects, small pilot projects are necessary to establish quality.

Security & Confidentiality

Information security is a challenge for every business and a business which operates virtually transmitting sensitive data over public communication networks is a high risk. It is desirable to establish systems for encrypted transmission in the least but a Virtual Private Network is a preferable. The other aspect of the security risk is employees or contractors stealing vital information. And there is no easy solution for this. Terminal services where the employee has access only to the tools that are necessary can be a solution but not in all cases.

People Issues

Though not always necessary, virtualization mostly involves people working from home. There are issues associated with work-from-home and it varies for each individual. The home-environment of the employee needs to be analysed in the context of the social environment that they are in. Working virtually devoid of direct human contact with other team members is an impediment to bonding and team-building. One needs to be alive to this problem and develop appropriate interventions to keep the team motivated and working to one goal.

Vital Necessities

To manage virtual business or a team successfully one must have most the following in place:

1.       Robust Collaboration Management Systems

2.       Reliable, and if possible redundant,  high-speed internet

3.       Tools for instant messaging, desktop sharing, screen casting, white-boards

4.       Rigorous recruitment process even for freelancers & contractors

5.       Strong people and project management processes

Redundancies in resources based on the criticality of the functions, reliability of people & technologies

And finally, an important distinction needs to be made between Virtualisation and Outsourcing. They are complementary but not competing options. And one is not essential for the other.

Virtual Workforce will become a reality when we put together systems and processes in place to harness the communication networks and collaboration tools effectively and when Virtual Businesses become common-place, the world would be a significantly better place to live in. I strongly believe that it will happen soon.

Rajeshwar is the CEO of InteleANTS - www.inteleants.com, a virtual business support services company. He consults to small businesses all over the world virtually and can be contacted through www.eshwar.in/contact/

Issue BG79 Oct07

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