In their evaluation of the concept of the Virtual Office, Thomas H. Davenport and Keri Pearlson, writing in MIT-Sloan Management Review, have identified five common arrangements to be considered:

1. Telecommuters are workers with fixed offices who occasionally work at home. 
    
2. Hotel-Based workers are persons who may be domiciled elsewhere but of on temporary assignment. During this time they come into the office frequently, reserving a cubicle where they can use the telephone and link their laptop computers to the network.
    
3. Tethered workers have some mobility but reports to the office on a regular basis
    
4. Home workers operate entirely from a room in their homes
    
5. Fully Mobile workers are on the road or at customer sites during the workday

It is suggested that companies considering adopting virtual work must be clear about the type of virtual office that best addresses their needs. Also, if virtual work is to pay off, managers must adopt new approaches in five key areas. These include the areas of managing people, managing information, managing teams, managing processes, and managing facilities. Companies will need to institute new information flows so as to replace those that are lost. They will need to educate workers on how to be more effective providers and consumers of information. It will be necessary to provide training in virtual worker management skills and personal work strategies. As the reality of CSME become more apparent and geography becomes less a factor of life, excellent workers will not only have the options of going to works in a lot more places but also that of more work coming to them from a wider variety of places. The world class knowledge worker equipped with a computer, mobile communication technology and high-speed internet access will be in high demand.

Object Services and Consulting, Inc. (OBJS) develops innovative technologies to enable the US government and businesses to operate and interoperate effectively in a distributed environment. They conducted a fairly extensive comparative analysis when they decided to establish themselves as a Virtual Office. We can glean some useful information from their report:

Some advantages for Virtual Offices 

• More time to work, easier access to work, employee-controlled quality of life. Telecommuting is becoming more widely accepted. A home office makes it easy to get to work. This means that more work is done over a day since employees can readily access their computing environment. A mobile office extends this high availability to going where the person goes. In addition, the annoyance and cost of the commute are eliminated. Generally, the money saved by not commuting should more than cover the cost of extra utilities. 
• Self-Management. Employees in a Virtual Office are free to work without being intruded upon by management. Self-management also cuts down on non-productive work such as repetitive memos, reports, presentations, administrative meetings, etc. which can plague some companies. Also, employees now have a better opportunity to fully develop their ideas as they envision them with less interference and micro-management. 
• Potential to hire remote workers who do not want to move to the home office region. It may be much easier to attract talent if physical relocation is not a major issue.
• Part time workers. It might make sense to hire some experts part time, especially university collaborators who might retain their faculty position but team with us as industry partners trading time for equity or salary and the chance to affect industry directions. 
• Because infrastructure technology available for virtual offices is now nearly comparable to enterprise infrastructure technology. With home ISDN bandwidth and laptops, reasonable communications can be in place for point-to-point and team communications that are beginning to be comparable to those supplied in large centralized organizations. In addition, at least as much communication occurs with those outside the organization as with those inside so there is less special benefit to proprietary internal communications since it is likely that standard versions will become generally available a few years later. 
• Maintaining just one and not two offices. Many knowledge based employees maintain a home office with equipment supplied by their employer, meaning the employer is maintaining two offices per employee and the employee is porting information back and forth between the two on a daily basis. A single home office reduces the cost and "centralizes the work." 
• Preexisting Equipment. Many new hires already own computers. This is a small bonus for the company because any appropriate equipment that the employee already owns might be available for free in the Virtual Office, perhaps at least reducing up front costs and improving cash flow for new businesses. Next to the actual land and building, the cost of workstations constitutes the greatest up-front cost for a centralized office. 

Some disadvantages 

• Communications and Camaraderie. Communications between employees are more difficult than walking down the hall. Building camaraderie from a distance is more difficult. It is not the same as being with each other frequently -- the socializing aspect is missing. If we could see and hear each other over the Internet, a large part of this need for human interaction might be reduced.
• Physical Meetings. Finding occasional meeting space on short notice or for short periods can be a challenge. 
• "Seems unprofessional." Many customers may not feel comfortable meeting in home offices for many reasons (e.g., invading privacy, atmosphere not professional, distractions, locating homes in neighbourhoods). There is also a general impression that employees are not really working when they are at home, that the business is not real.
• Opportunity for abuse. Are employees really working 100% when distracted by TV, family, perfect weather, etc.? Are timesheets accurate? Although abuses can happen in central workplaces as well, there might be an initial thought that abuse is less common with management's close presence. Ultimately, the best measure is to assess the quality and timeliness of work to insure fair value is returned for competitive pay. 
• Employees Work Environment. Not everyone is cut out to work in a virtual office. A person must have self-discipline and be self-motivated. Working from home day-after-day is not the same as occasional telecommuting. Some employees may not have a work space that is conducive to remote work or may not wish to work from home.
• Training. In a centralized office, training is usually accomplished by bringing a group of employees to a meeting place. This is a problem in the Virtual Office where such areas do not exist. One solution is the use of seminars instead of on-campus training, but this has the disadvantage of being expensive and inconvenient, requiring that employees to travel from their workplace. Videoconferencing provides a reasonable alternative.
• Updating Technology. With each employee in the Virtual Office using his/her own machine, updating both hardware and software across the company might appear to become harder. It can no longer be a central or work group operation but instead every employee must bear some responsibility for environment set up and maintenance. Another factor is that employees living in different regions may not have access to new communications infrastructures like broad band, especially in rural areas, and employees in other countries may be subject to later release dates for software. A downside to this arrangement is that employees currently must maintain their own computer and its software.

I do believe that the advantages are significant and the disadvantages can be worked with, if not around. All level of business must now seriously consider what aspects of their operations are now ready to move to the Virtual Office.