The organizational performance of software companies has become critically important. While customer requirements are changing and varying ever more frequently, and an effective management of the software process is becoming essential, the suitability of current software-related business models has become questionable [27, 29]. One of the current global trends is trans-organizational collaborative work in distributed, dynamic teamwork environments, called Virtual Software Corporations (VSC). The virtual organizational structure presents particular challenges to Software Configuration Management (SCM), while the rate of change in size, complexity and duration of software projects has shown an increasing acceleration. This paper describes a SCM process analysis conducted in three virtual software production organizations. One of the main results that will be presented in this paper is a framework for practical SCM process improvement, consisting of SCM challenges defined based on key VSC characteristics and attributes.