There is an abundance of academic research to support the performance advantages of co-located teams in new product development. Marina Mendonça Natalino Zenun, Geilson Loureiro and Claudiano Sales Araujo in “The Effects of Teams’ Co-location on Project Performance” suggest the following definitions:

Team: a small number of people with complementary skills who are equally committed to a common purpose, goals, and working approach for which they hold themselves mutually accountable.

Co-located Team: a team that has a common physical area specifically allocated to the execution of the tasks related to the project. The team members shall seat close together. By close, it is defined as close enough that they can overhear each other’s telephone conversations. 

In “Design Teams: Co-location Trumps Remote” Jared Spool observed that co-location of a team facilitates the development of a common vocabulary for an emerging vision. He wrote “A co-located design team will have an easier time of producing great designs than a remote team.”

Challenging the Implications

The performance comparison of a co-located team and a remote team may have an implication that the two ‘teams’ are composed of the same number of individuals with the same set of unique skills and experiences and training.

The two groups of individuals do not have to be ‘the same’ in every aspect expect where they sit. Consider the following potential differences in the remote network

Challenge 1: The remote network can include individual contributors with superior skills in the designated domains. Several individuals can have enhanced capabilities in appropriate domains.

Challenge 2: The product champion (product manager, product owner, development lead,..) for the remote group can be ten times more capable of leading a remote network of individuals that have a more diverse skill set than the person in the equivalent role for the co-located team. The person recruiting the talent for the remote network can have a better vision of what will be required at various times during the project than their counterpart for the co-located team.

Challenge 3: The remote network can have supporting tools for cooperation and collaboration that are five times better than the generic tools of the co-located team.

Challenge 4: The project may benefit by having individuals that have been immersed in a particular culture or a variety of cultures. The geographically dispersed team may be equipped to understand the regional/global aspects of the project more quickly that the co-located team.

Challenge 5: The nature of the project may benefit from testing the product in multiple geographic locations. The geographically dispersed network may be equipped to make more direct observations of potential customers using the product. They may have better skills to interpret the results.

Challenge 6: There may not be sufficient supporting resources for a co-located team at a central facility. There may be shortages of physical space or IT support. A distributed network may be able to adapt to an evolving need for specified head-counts and expertise better than a co-located team. The remote network may be able to mobilize ‘available resources’ (those that do not have obligations to other concurrent projects) better than a co-located team.

Challenge 7: The remote team may be available to take advantage of an emerging opportunity when a co-located team’s involvement may be delayed. The ability to begin learning soon may provide a unique competitive advantage.

Challenge 8: If the business case is compelling enough to justify starting the project immediately, it may be easier to raise additional funds to expand the portfolio using a remote network than it would be to re-arrange the assignments of individuals that are part of co-located teams with responsibilities to other projects.

Enhancing the Capabilities of Individuals in Development Networks

I have never completed a project where every individual on the team was co-located. Some contributors were located more than 10 meters from the core group. Some contributors were located in other buildings or in other timezones. Some contributors were not employees of the company funding the project. Some contributors may have been described as part-timers, vendors, partners, contractors, or temporary workers. It is unlikely that any of my future projects will be done with a co-located team.

Since more development work will be done with individuals in remote networks, what approach is more likely to produce better outcomes for customers, the business, and the individuals involved in the project?

To improve the outcomes for the customers, the business, and the individuals involved in the project, I recommend investing to improve the capabilities of the individual contributors. This includes enhancing the skills of individuals in their current specialties and providing training to expand their capabilities. This includes improving the potential for selecting more appropriate talent. This includes enhancing the capabilities for individuals to contribute value to the network.

Actionable Items

Evaluate the eight challenges. Contemplate others. Invest to improve the capabilities of individuals that contribute to your remote networks.