Teams by their very nature are interdependent. Although they assign roles, differentiate responsibilities, and hire members with complementary skills, the purpose of teams is to coordinate work toward a common goal. To do so, they must have a shared understanding of the goal toward which they are working and the processes that will help them to achieve that goal. In virtual teams, separated by geographical distance, the process of developing a shared understanding is more challenging. Members of virtual teams rely heavily on mediating technologies for their day-to-day communications, do not share the
same work context, and are not geographically proximate. All of these factors conspire to inhibit knowledge sharing and shared understanding on virtual teams. In this chapter, we discuss the importance of shared understanding, the
factors that lead to shared understanding, and how these factors may differ on virtual teams. The chapter ends with a discussion of how managers might design and lead virtual teams that are able to triumph over these limitations.