Collaboration Capability in Virtual Teams: Examining the Influence on Diversity and Innovation

Virtual teams are being increasingly utilised in industry given their ability to bring together diverse knowledge and experience from individuals who are not geographically proximal. Having a diversity of knowledge within virtual teams is noted to benefit innovation outcomes; however, leveraging the benefits of diversity (both deep and functional-level) is likely to require a capability to facilitate collaboration among team members. In this study, we empirically validate a measure of collaboration capability (CCAP) and examine its role in enhancing the benefits of diversity on innovation within virtual teams. Using a sample of 375 design and software engineers working in virtual teams from a high-tech firm in Silicon Valley, we find that CCAP significantly moderates the relationship between functional-level diversity and innovation, but no significant influence is found for a similar moderating influence on deep-level diversity and innovation. The implications for the study of virtual teams are discussed and recommendations are offered for organisations using virtual teams.