As we are heading toward the 21st century, more companies will institute formal telework \ telecommuting programs and a substantial portion of the workforce will be conducting its work away from the traditional office and from direct supervision. This paper focuses on managerial challenges that arise in managing distributed workforce in a telework environment. Telework environment as a work arrangement demands organizational and managerial adjustment in communication patterns, performance management, corporate culture, and the work itself. The insights in this paper are drawn from the results of a telework survey and managerial focus groups.