As we move into the 21st century, a number of innovations that were once merely ideas are now becoming reality. One of these is the virtual organization, where organizational members are geographically separated, but work together through computer technology. To date, much of the research and thought on virtual organizations has focused upon virtual technology and organizational design-how to link the individual members and how to design the virtual organization to carry out its work. This book takes this further in addressing the crucial question, how do you do human resource (HR) functions in the virtual organization? This question is particularly relevant when you consider that most traditional HR functions-hiring, training, evaluating performance, and rewarding (or disciplining) performance-assume there will be face-to-face interaction as the basis for carrying out that function.
This book examines human resource management (HRM) in the virtual organizational in 14 chapters written by various authors and compiled into four parts. Part I as the introduction contains two chapters. Greenberger and Wang define and describe the virtual organization in the first chapter. Then Crandall and Wallace look at the difference between traditional and virtual workplaces in the second chapter. Part II examines HRM program delivery in three chapters. McClendon, Klaas, and Gainey look at HR outsourcing. Snell, Stueber, and Lepak examine HR departments, and Ulrich and Beatty describe the role of the HR professional in the virtual organization. Part III presents HRM programs in virtual organizations.
Sk chapters describe job analysis (DeCaprio), staffing (Elllingson & Wiethoff), training and development (Noe & Simmering), performance management (Cleveland, Mohammed, & Skattebo), hybrid reward systems (Heneman, Tansky, & Tomlinson), and negotiation (Lewicki & Dineen). Part IV contains two case studies delineating the problems and solutions to electronic commerce (e-commerce) banking in China by Wang, and cross-functional teams cyberlinked in an orthopaedic manufacturer written by Crandall and Wallace. Finally, Part V concludes with a chapter on observations by Cardy.
Most of the authors are academicians. Thus, they have a natural tendency to describe virtual organizations in terms of conceptual models, evolving constructs, and theoretical foundations. To the authors’ credit, however, they make a concerted effort to use real virtual organizations (is that an oxymoron?) to illustrate their points, like the Technology One Alliance among BankOne, AT&T, and IBM, the networks between Walmart and its vendors, Merck’s virtual HR activities, and Lucent’s virtual product development team composed of 500 engineers operating over 13 time zones. In the first chapter, Greenberger and Wang take on the large task of trying to define exactly what a virtual organization is. They review 25 definitions from various articles and conclude that a virtual organization has several characteristics.
First, there is a partnering relationship among parties either within or outside the organization. Second, there is a focus on core business activities that the virtual organization does well. Other activities are done by more traditional organizations. Third, technology connects the partners with the core business activities. Fourth, the organizational structure is flexible and fluid. Fifth, there is a focus upon virtual teams working on projects. In Chapter 2, Crandall and Wallace define the virtual workplace as “a network of people conducting business processes beyond the traditional bounds of organization, time, and space.”
They contrast the traditional with the virtual organization and find that virtual organizations emphasize self-managed teams, broad-based duties, cross-functional skills, and a network orientation. One consequence is that the HR manager in a virtual organization takes on more differing roles than does the traditional HR manager. The virtual organization HR manager must be a coach delivering feedback to self-managed teams, an architect of work flows using computer technology, a designer and deliverer of innovative HR programs to fit the virtual organization, and a facilitator of teamwork in self-managed teams.
The most interesting section is Part III on how to carry out HR functions within the virtual organization. The basic functions look the same as in the traditional organization, but the techniques are sometimes radically different. For example, in the virtual organization, electronic performance monitoring and online chat sessions are job analysis methods. Recruiting occurs through Internet job boards. Hiring involves electronic resumes, online testing, and online interviewing. Training focuses upon electronic learning (e-learning) capability, communities of learning, and the use of learning portals. Performance management involves maintaining individual technological skill mixes and evaluating virtual team performance. Even pay systems need new forms because of the new types of work structures-virtual teams, alliances, and networks-and the changing perception of pay equity within these structures.
One theme that underlies many of the chapters is the importance of teams in the virtual organization. The self-managed team is one of the building blocks of these organizations. Team members must possess or be trainable on traits conducive to operating in the virtual organization: communication skills, cultural sensitivity, networking ability, tolerance for ambiguity, and interpersonal adaptability.
Finally, virtual negotiation is unique. Negotiation in traditional organizations is face-to-face, but virtual negotiation occurs largely through e-mail, which, on the one hand, has a greater propensity for norms of “taking turns” (e.g., waiting for an e-mail reply); but, on the other hand, there is a greater tendency for disinhibition, which may allow for rude and compulsive behavior, like “flaming.” Moreover, there is a greater tendency toward message misinterpretation in virtual negotiation e-mails that lack the nonverbal information richness of face-to-face interaction.
As I read the chapters, it occurred to me that the authors make a very basic assumption, which is that the computer technology linking everything together is reliable and secure. This is particularly relevant because the combination of attacks from viruses and worms that had swept the nation in August, 2003, was still a very fresh memory as I read this book. To compound the problem, our university computer router went out at the same time. The consequence was very limited access to e-mail and the Internet as our fall semester began.
It was a shock to see how much this negatively affected our teaching, research, and interaction with our colleagues. And this was within a traditional university structure. I wonder how these onslaughts of viruses, worms, hackers, and equipment breakdowns affect virtual organizations. In the traditional organization, there are backup communication systems to the computer, such as faxes, phone messages, and even walking over to someone and talking face-to-face. What is the alternative to the very centralized role of the computer if it malfunctions in the virtual organization?
In conclusion, virtual organizations are much more than merely doing e-commerce through Web pages and gaining remote access to the company computer. They involve partnerships, fluid and flexible boundaries, focused business processes, broad-based skill mixes, decentralized teams, and complex connectivity to information networks. They run the gamut from loosely coupled telecommuting relationships to intricate cybernets. As the authors state, HR for virtual organizations will be one of the challenges facing business in the 21st century.
Based upon what the various chapters describe, these virtual HR activities will probably still retain the traditional names, like recruiting, hiring, and training, but their actual forms will be as different as an SUV is to a Model T. So let’s fasten our seat belts for a wild ride at Warp 4.5 into the virtual HRM reality of the virtual organization. But don’t beam me up quite yet, Scotty.