Some companies I know use virtual managers and virtual teams unnecessarily in their China operations. Let me explain as you may do it.
Instead of having a Chinese worker report to their local manager, they have the worker report overseas to a functional manager. It is especially common in the finance function and especially damaging as well.
If you have known people who made unusual friends in chat rooms, you can know that people can be almost anyone if they are in a chat room. Virtual teams have the same kinds of problems.
The Chinese worker can too easily manipulate the overseas manager. Just how they are working and being a team locally is very hard to really know and the result in the office locally is not healthy in most cases.
Some companies do not want finance to have much contact with the company as they fear “guanxi” could lead to loss of funds. In engineering they fear loss of IP. The result is a dysfunctional local team that does not have the bang that you could otherwise have.
Of course, your China GM usually must report overseas . Here, you must have a professional method to place this person and to manage them. You must invest deeply in understanding and relationship because without trust the whole becomes a mess and virtual teams start to replace natural teams.
Some companies are so focused on getting the right technology person that they do not place leaders and look down on leadership in some ways. They trust people in the home office and have them oversee these people one by one personally. A good China leader can be found and somewhere in your org, you have someone who can manage that overseas manager. I strongly counsel to not make virtual teams where it is not necessary. Team locally where people can be really known and managed well. And work hard to gain understanding of the overseas manager. Make sure that person is a leader and not a doer. It is worth the effort with the bang you can get with a good leader making a good local team.