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World markets are unsteady, unemployment is on

the rise, housing foreclosures are up, asset values

are down, and the political landscape is shifting. Under

such tumultuous conditions, people often look to leaders

to soothe battered nerves. But in today’s rough and tumble

environment, there are reportedly few leaders the average

person relies upon.

Over 80 percent of Americans believe that we are in the

midst of a major leadership crisis. And over 75 percent of

executives from around the world are seriously concerned

about whether businesses can develop good leaders for

the future. And yet not one leadership book squarely

addresses the issue of the changed workforce, the virtual

workforce, and why old leadership models just don’t

work—until now.

Leading the Virtual Workforce builds off the ground-

breaking concept of Virtual Distance introduced in Sobel

Lojeski’s seminal fi rst book, Uniting the Virtual Workforce.

And in never-before-published interviews, leaders from

IBM, Merck, Western Union, Alcatel-Lucent, HP,

AT&T, and more share detailed case studies about what’s

diff erent about leadership today and how to become

a great leader in the Digital Age. Leading the Virtual

Workforce covers:

• Th e most common myths about leadership for

today’s virtual workforce

• Why old leadership models need to be reshaped

for a new era

• What great leaders do diff erently to thrive in the

globally connected enterprise

• A new leadership model custom-built for today’s

workforce realities

• Advice from the greats for those looking to

advance their leadership and management

eff ectiveness for the virtual workforce

Th e virtual workforce is a relatively new phenomenon.

Th e Virtual Distance Model provides the quantitative

data and predictive power needed to understand how

new behaviors, born out of the Digital Age, impact

performance, innovation, and other critical success factors.

And now the time has come to reshape leadership models

to best serve worldwide organizations in the twenty-fi rst

century. Leading the Virtual Workforce does just that—

paving the way for future leaders to create unmatched

competitive advantage and performance improvements

in the growing world of virtual work.

KAREN SOBEL LOJESKI, PHD, is a

Professor at Stony Brook University

in the Department of Technology

and Society, author, and founder of

Virtual Distance International (VDI),

an advisory fi rm specializing in virtual

teams, leadership, innovation and learning in the new

millennium. Prior to launching VDI and joining Stony

Brook, Karen spent eighteen years in corporate America.

She held leadership positions at Chase Manhattan Bank

N.A., Mercer Consulting Group, and Stratus Computer,

Inc. She was Chief Operating Offi cer for Prolifi cs, a

JYACC company, and Vice President of North America

for Xansa. She is a popular speaker on Virtual Distance

and other unintended consequences of technology in the

wired workplace, school systems, families, and society as

a whole.

“Strong leadership in the best of times is diffi cult to achieve, but in today’s rapidly

changing business environment, leaders are tested in many new ways. Once again,

Lojeski has a fresh take on what it takes to lead today’s widely dispersed workforce.”

—Ellen Pearlman, former editor-in-chief, CIO Insight magazine

“Karen Lojeski has distilled the essence of the leader’s role in ‘managing’ virtual teams.

Her very relevant case stories illustrate that to be successful, the authentic leader must

be able to create context and a collaborative lexicon for virtual knowledge sharing and

must work diligently to build the social capital that is so vital to the success of virtual

work groups. Karen’s key contribution in this and her previous book, Uniting the Virtual

Workforce, is the ‘discovery’ and clear articulation of her theory of the Virtual Distance

Index, which leaders can use to measure and manage the process of virtual teamwork.”

—Dave Davison, Chairman, Virtual Visuals Inc.

“I agree entirely with Karen when she says that today, more than ever, eff ective

leaders are desperately needed. She skillfully defi nes the dislocation and demarcation of

leaders from followers through the ‘Virtual Distance,’ and yet paradoxically calls leaders

to ‘stoke the fl ames of innovation and cooperation in a complex, interwoven world.’ Th is

gives rise to her exploration of the Virtual Distance Leader. As Karen points out, the

twenty-fi rst-century leader must, amidst the conditions of pressure, change, and

transformation, bring human endeavor and action to value and meaning for others.”

—Adrian Machon, Director, Executive & Leadership Development, GlaxoSmithKline

LEADINGTHE

VIRTUALWORKFORCE

Karen Sobel Lojeski

H O W G R E A T L E A D E R S T R A N S F O R M O R G A N I Z A T I O N S

I N T H E 2 1 S T C E N T U R Y

Jacket Photograph: Louie Psihoyos/CORBIS

Cover Design: David Riedy

LEADING THE VIRTUAL WORKFORCE

. us / . can

LEADING THE

VIRTUAL WORKFORCE

Praise for

P1: OTA/XYZ P2: ABCFM JWBT169-Sobel September 8, 2009 20:36 Printer Name: Yet to Come

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Leading theVirtual Workforce

i


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Leading theVirtual Workforce

How Great LeadersTransform Organizations

in the 21st Century

Karen Sobel Lojeskiwith Richard R. Reilly

John Wiley & Sons, Inc.

iii


Copyright C© 2010 by Karen Sobel Lojeski. All rights reserved.

Published by John Wiley & Sons, Inc., Hoboken, New Jersey.Published simultaneously in Canada.

No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any formor by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except aspermitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the priorwritten permission of the Publisher, or authorization through payment of the appropriate per-copy feeto the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, (978) 750-8400, fax(978) 750-4470, or on the web at www.copyright.com. Requests to the Publisher for permission shouldbe addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ07030, (201) 748-6011, fax (201) 748-6008, or online at www.wiley.com/go/permissions.

Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts inpreparing this book, they make no representations or warranties with respect to the accuracy orcompleteness of the contents of this book and specifically disclaim any implied warranties ofmerchantability or fitness for a particular purpose. No warranty may be created or extended by salesrepresentatives or written sales materials. The advice and strategies contained herein may not be suitablefor your situation. You should consult with a professional where appropriate. Neither the publisher norauthor shall be liable for any loss of profit or any other commercial damages, including but not limited tospecial, incidental, consequential, or other damages.

For general information on our other products and services or for technical support, please contact ourCustomer Care Department within the United States at (800) 762-2974, outside the United States at(317) 572-3993 or fax (317) 572-4002.

Wiley also publishes its books in a variety of electronic formats. Some content that appears in print maynot be available in electronic books. For more information about Wiley products, visit our web site atwww.wiley.com.

Library of Congress Cataloging-in-Publication Data

Sobel Lojeski, Karen.Leading the virtual workforce : how great leaders transform organizations in the 21st century / Karen

Sobel Lojeski, Richard R. Reilly.p. cm. – (Microsoft executive leadership series ; 14)

Includes index.Summary: “How to understand and attain the attributes and skills required to be a successful leader inthe new digital age. Rapidly evolving changes in the way that we work have led to the need for a newmodel of leadership. Motivating and inspiring employees who are geographically, culturally, andfunctionally dispersed requires new sets of skills and different kinds of behaviors. This visionary bookuses real-life models of world-class leaders who have demonstrated their ability to lead their virtualworkforce through the combined use of technology and personal styles. It presents a new model ofleadership that incorporates the key attributes of these successful leaders and presents tools andtechniques for becoming a successful leader in the digital age. Karen Sobel Lojeski, PhD (Port Jefferson,NY), is Professor in the Department of Technology and Society in the College of Engineering andApplied Sciences at the State University of New York at Stony Brook. Karen is also the CEO of VirtualDistance International, an advisory firm specializing in leadership and innovation in the new milleniumvirtual workplace. Richard R. Reilly, PhD (Basking Ridge, NJ), is Emeritus Professor of TechnologyManagement at Stevens Institute of Technology”–Provided by publisher.

ISBN 978-0-470-42280-91. Leadership. 2. Computers–Social aspects. I. Reilly, Richard R. II. Title.HD57.7.S6925 2010658.4′092–dc22

2009025055

Printed in the United States of America

10 9 8 7 6 5 4 3 2 1

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For Edward Friedman and A.J. Lederman

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vi


Contents

Microsoft Executive Leadership Series: Series Foreword ix

Preface xi

About the Interviewees xxi

Acknowledgments xxxiii

Chapter 1 ............................................................................... 1A Whole New World

Chapter 2............................................................................... 17A Brief History of Leadership

Chapter 3............................................................................... 33Creating Context

Chapter 4............................................................................... 49Cultivating Communities

Chapter 5............................................................................... 61Co-Activating New Leaders

Chapter 6............................................................................... 77Techno-Dexterity

Chapter 7............................................................................... 93The Virtual Distance Leadership Model

vii


viii CONTENTS

Chapter 8............................................................................... 113The Future of Leadership As We Know it

Chapter 9............................................................................... 123A Different View of Leadership Altogether

Appendix A.............................................................................141The Virtual Distance Model

Index 151


Microsoft Executive Leadership Series:Series Foreword

Today’s world requires lifelong learning. The Microsoft ExecutiveLeadership Series provides leaders with access to new ideas and per-spectives, intended to inspire and to challenge—ideas that will help

keep thoughts fresh and minds nimble. These ideas range from effectivestrategy to deploying an agile infrastructure. Information technology in-creasingly drives the evolution of business models, social norms, marketexpansion, even the very shape and nature of our institutions. Organiza-tions that succeed in the future will differentiate themselves effectively onhow well they use technology to navigate change, respond to challenges,and leverage new opportunities.

I talk nearly every day to executives and policy makers grappling withissues like globalization, workforce evolution, and the impact of tech-nology on people and processes. The idea for this series came from thoseconversations—we see the series as a way to distill what we’ve learnedas a company into actionable intelligence. The authors bring indepen-dent perspectives, expertise, and experience. We hope their insights willspark dialogues within organizations, among managers, and with policymakers about the critical relationship between people and technologyin the workplace of tomorrow.

I hope you enjoy this title in the Microsoft Executive LeadershipSeries and find it useful as you plan for the expected and unexpecteddevelopments ahead. It’s our privilege and our commitment to be partof that conversation.

DANIEL W. RASMUS

General Editor, Microsoft Executive Leadership Series

ix


x MICROSOFT EXECUTIVE LEADERSHIP SERIES: SERIES FOREWORD

Titles in the Executive Leadership Series:

Rules to Break and Laws to Follow by Don Peppers and Martha Rogers,2008.

Generation Blend by Rob Salkowitz, 2008.

Uniting the Virtual Workforce by Karen Sobel Lojeski and Richard R.Reilly, 2008.

Drive Business Performance by Bruno Aziza and Joey Fitts, 2008.

Listening to the Future by Daniel W. Rasmus with Rob Salkowitz,2008.

Business Prosperity by Michael Hugos, 2009.

Strategic Project Portfolio Management by Simon Moore, 2009

Leading the Virtual Workforce by Karen Sobel Lojeski and withRichard R. Reilly, 2009.

Old World, Young World by Rob Salkowitz, 2010.


Preface

A few years ago, Warren Bennis, a prominent leadership scholar notedthe following:

Bad leadership at Enron alone impoverished thousands of employees,stealing their livelihoods, gutting their retirement accounts, and tearingthem apart with stress. . . . There are, no doubt, people who took theirown lives because of what was done at Enron by its lavishly compensatedbad leaders.1

As it turns out Bennis underestimated the impact that bad leadershipcan have. A combination of greed, hubris, flawed judgment, and miscal-culation has made the Enron debacle seem almost quaint by comparisonto the global financial crisis that we now face. Although numerous pun-dits and scholars have advanced many reasons for the devastating situa-tion, the bottom line is, as Bennis pointed out previously, bad leadershipis one of the major reasons for the current state of affairs. However, it’snot simply dreadful leadership, it’s also the wrong kind of leadership fora new age.

If a group of typical corporate employees from the early 1980s couldbe time-transported into today’s interconnected, high tech, global worldthey would be astonished by the degree of change in the way that workis done. This same group of employees might also be surprised to learnthat the same leadership models they learned about in the early 1980sare pretty much still applied in our academic institutions and our busi-ness enterprises, without any significant modifications or alterations toaddress the challenges leaders face in the digital age.

1W. Bennis, “The Challenges of Leadership in the Modern World,” American Psychologist,62, 2–5.

xi


xii PREFACE

In the first book, Uniting the Virtual Workforce,2 a new phenomenonwas described. It’s called Virtual Distance. And it explains much of whathad been highly misunderstood about the virtual workforce until then.The Virtual Distance model also shines much needed light onto whatleaders of today need to do differently.

Virtual Distance is characterized by a combination of physical sepa-ration, technology mediation, and disconnected relationships. These dy-namics lead to a psychological separation that builds over time. And theresearch documents the negative effects that Virtual Distance can haveon productivity, innovation, and trust between employees and groups oforganizations. This data should be of major interest to any leader tryingto improve performance and advance competitive advantage.

When Virtual Distance is relatively high the following critical successfactors significantly degrade:

� Innovation falls by over 90% and competitive advantage is severelyimpacted.

� On-time/on-budget project performance suffers by over 50% andcan cost a company millions of dollars.

� Trust declines by over 80%.� Job satisfaction drops off by over 80%.� Goal and role clarity decline by over 60%.� Good citizenship behavior plummets by over 70%.

These results, which reflect outcomes in over 500 project teams fromaround the world, quantitatively show that the virtual workforce needsnew leader focus. The original Virtual Distance research approach in-cluded interviews with dozens of managers, individuals, and leaders.Than, a survey was deployed to measure the Virtual Distance Indexamong hundreds of teams. Using this data, it was found that:

� Virtual Distance has significant impact on performance and com-petitive outcomes.

2K. Sobel Lojeski, R. Reilly, Uniting the Virtual Workforce: Transforming Leadership andInnovation in the Globally Integrated Enterprise (Hoboken, NJ: John Wiley & Sons,2008).


PREFACE xiii

� Virtual Distance is not only measurable but can also be predicted,therefore it can be avoided with proper analysis, planning, or in-tervention.

� Virtual Distance is just as prevalent among co-located team mem-bers as it is among geographically dispersed groups so it should notbe assumed that if you have people all working in the same placeyou are without Virtual Distance risk.

� When Virtual Distance is relatively high—leader performance suf-fers significantly more than when Virtual Distance is relatively low.

These findings have been used to help organizations improve per-formance, enhance innovation, and avoid problems before they emergethrough Virtual Distance Indexing, Virtual Distance Mapping, and Vir-tual Distance Management, techniques detailed in the first book on thesubject.

Survey research, which led to the ability to quantitatively measurethe impact of Virtual Distance, is a powerful method for uncoveringimportant information. But surveys are also limited in that they don’tgive the whole story or allow for immediate follow-up when somethinginteresting is found.

So in this follow-on work another approach was used. Interviews weretaken with highly effective executives as well as other thought-leaders.The major participants, in order of their first appearance in the book,include:

� Steven A. Tainer, Contemplation Scholar and Author� Susan Roser, Senior Vice President, Global Service Support,

Western Union� Robert McMahon, President of U.S. Commercial Operations,

Merck & Co., Inc.� Cheri Sterman, Director of Child Development and Consumer

Relationships, Crayola� Guido Petit, Director of Alcatel-Lucent Technical Academy, Alcatel-

Lucent

Documents

(continued from front ﬂ ap) LEADING Praise for LEADING …€¦ · Lojeski World markets are unsteady, unemployment is on the rise, housing foreclosures are up, asset values are