Distributed working allows employees to work remotely while maintaining productivity. It provides work-life balance benefits for staff like flexibility and no commute, while reducing costs for the company like office space. Key tools for distributed working include communication platforms like IRC, VOIP, Google Docs, and intranets. Regular scrum meetings, project management, and pairing help remote workers feel connected despite physical isolation. Successful distributed working requires self-management skills and an understanding of company culture from remote employees.