Innovative organizations have always looked for ways to ratchet up efficiency and productivity. They've reengineered business processes, adopted technology improvements and introduced a mind-bending array of perks. "The goal of creating the most efficient work environment possible is an ongoing issue," says Chad Thompson, senior consultant, Aon Hewitt.

The virtual workplace, a long-desired objective for many organizations, lies at the intersection of these three key areas. Unfortunately, the concept has often lagged behind expectations and served up a tangle of challenges, obstacles and frustrations. Although many businesses have embraced bits and pieces of virtual work—enabling telecommuters and road warriors—a holistic and integrated approach has proved mostly elusive.

Fortunately, times change. Thanks to faster, better and more ubiquitous data networks; improved phones and computing devices; and cloud-based data initiatives that provide constant and real-time data accessibility, a growing number of organizations are finding that home and away is where the worker is. Over the past two years, the prevalence of virtual work has spiked 39 percent, according to global human resources association WorldatWork.

It's not difficult to figure out why virtual work is on the rise. The growing emphasis on worker productivity and employee cost-cutting initiatives is fueling the trend. Increasingly, organizations are looking to trim office space and real estate expenses, provide greater flexibility for harried workers, embrace a greener work environment, and position individuals at the point of interaction with customers and business partners. "It's possible to achieve substantial gains by going virtual, but success isn't a given," says Pat Caputo, senior consultant, Aon Hewitt.

Making Connections

These days, an overwhelming number of business executives view the virtual office as a highly desirable concept. A recent Aon Benefits and Talent survey found that 97 percent of the people surveyed thought they would have the same or higher number of virtual workers in the future. The problem, Caputo says, is sliding the dial from goal to results. "An organization must put the right technologies, strategies and processes in place in order to succeed," he notes.

To be sure, realizing the benefits and avoiding the hidden costs of a virtual work program demands careful planning and an ongoing focus on factors ranging from technology to teams. "An organization must distinguish between different types of jobs, what is possible and what a virtual work environment can deliver," Caputo explains. "Although technology enables virtual work, it's still up to organizations to develop a plan and use it effectively."

The first step, Thompson says, is to determine an organization's readiness for virtual work. This covers an array of areas, including the ability to access and exchange enterprise data via computers, netbooks, smart phones and other devices. It also encompasses a variety of software tools and applications. It might also touch cloud-based applications, such as Salesforce.com, that offer customer data anywhere, anytime, as well as collaboration software, including desktop video conferencing.

But technology is only a starting point. An organization must ensure its people are comfortable with technology and virtual teams. These individuals must be able to set their own schedules and remain accountable for their work and actions. They must be self-starters and require little or no direct supervision. Screening and interviewing applicants up front is vital. "Some people are better suited to virtual work than others," Thompson explains.

It's also essential to train managers—especially older individuals who are accustomed to a traditional work environment—on how to oversee employees within the virtual arena. Employees aren't visible and they may choose to work at nontraditional hours. As a result, an enterprise must have systems in place for measuring results, Caputo says. "There must be an effective way to monitor engagement levels as well as actual work and projects."