This is the fourth in the list of agile limitations:

1. A team of stars
2. Fit with organizational culture
3. Small team
4. Collocated team
5. Where's my methodology?
6. Team ownership vs. individual accountability

Agile emphasizes that face-to-face, spontaneous conversation is the best form of communication. While we can certainly agree on the benefits of this form of communication, it severely limits agile applicability. Moreover, this agile principle extends beyond the development team since other stakeholders such as business analysts are required to be collocated.

What does it mean in practice? Imagine that a team member has a question concerning a use case. She should be able to get up, walk 10 meters, ask the business analyst or key user for clarification, and get back to work. Consequently, office space has to be physically arranged according to agile projects so that all stakeholders involved in daily activities are located at the same place (let's say within a minute of walking distance).

We can easily think of a number of situations where this limitation prevents using agile:

• Office space organized by departments: In most organizations, offices are organized by departments such as IT, marketing, accounting, sales, and so on. Moving people around according to agile projects is unrealistic. Even if it was possible, it would negatively affect other parts of the business.
• Distributed environment: Developers are often distributed throughout the organization, whether in the same branch or in different branches (or working from home). Just like for the previous point, moving these people is unrealistic.
• Subcontracting: Many organizations partly or completely outsource software development. Assuming that some roles such as business analysts or key users would be located at the company, this situation doesn't comply with the agile collocation principle.

We have to acknowledge that there is no substitute for face-to-face, spontaneous communication. Consequently, the best solution is to restrict the agile team to people working at the same location, knowing that even if it were possible it would constitute a less-than-ideal team.

Alternatively, we can try to make the better of it by managing a "virtual" agile team:

• Collocate as many team members and stakeholders as possible.
• Set up an "open phone line / video chat / IM" policy to make sure that spontaneous communication is still possible between distant stakeholders.
• Leverage collaborative software (although in my opinion it has little effect).
• Schedule frequent in-person meetings with distant stakeholders.
• Start the project with everyone at the same location for a few days in order to build team spirit.