This study aims to recognize how virtual teams should be coordinated and led in organizations that operate at multiple sites. To fulfill the purpose of the study, a literature review on previous research on virtual teams was implemented. Further, a qualitative study including interviews with leaders at different levels at Ericsson was conducted to gain empirical data on how leadership in virtual teams works. The interviews were semi-structured with the purpose of not directing the leaders towards only bringing up the challenges that emerged in the literature review but to also bring up new perspectives. The major challenges that virtual teams face, thus challenges that the leaders must somehow address, can be divided into three areas: communication, coordination and location. Concerning communication, it is important that leaders of virtual teams set the means for communications, define ground rules and make sure that the right kind of communication is used for the right purpose. Further, it is important to communicate more often than if the team would have been co-located and actively try to build trust and cohesion within the team by being transparent and honest. To meet face to face with the team members, especially in the beginning when the team is created, is important both for understanding (virtual communication becomes easier afterward) and for the building of trust and cohesion. In the area coordination it is important for the leader to clearly define the roles of each team member and how the roles as well as the team efforts contribute to a larger picture. There is no perfect distribution that is applicable to all virtual teams, each team must find their balance concerning how many team members that should be positioned at each site. In general, to push responsibilities down in the hierarchy is a suitable role structure for virtual teams. The location area includes challenges such as different languages, cultures and collaboration across different time zones. It is important to have an operative language that all team members understand and master. When creating a new team, it is important that the leader or the person creating it, is aware of how cultural differences impact, so that the challenges can be addressed properly, and the benefits of diversity as well as the expanded labor pool, can be utilized. Working across different time zones brings benefits such as more hours of the day can be used, but it also includes challenges, such as limited real-time communication. Thus, the optimal time overlap is difficult to define, but generally, leaders prefer involving fewer time zones and large time overlaps.