@jespah,
I agree with jespah on this. Even video conferencing is not as good as face to face in person but it is better than just a voice without a face.
It is harder to know what a person is reacting to something you say if you do not see their reaction. Often times say you are training someone - you cannot see their face - it is hard to know if they really are understanding - it is easier if you see their reaction. Yes - you can ask - but often times they will just say yeah.
One experience I had - I was managing a team that was half way across the country. Some I interviewed over the phone and never saw them in person before. We would have video conferencing with the team often times and I still felt that was a bit strained with those that I never met. There were a couple that had worked in my office and then moved to the new location - I had good relationships with them - but I felt a strained relationship on the others - like they held back or I couldn't get a read on them.
I did travel down there - and did so more often afterwards - once I traveled and met them in person I could tell the relationship was much more different. They responded better to me and were more open when asking questions.
I am not a psychologist but there was a huge difference when I was in person than when I called. And afterwards as well - there is just much more you do not realize that comes into play when working with others than just words and text.
And as far as dressing up - I work in the financial industry so unless I am meeting with a client and they are formal - we dress business casual - there are fee that get dressed up any more.
My current client is several hour flight away so even when I went to visit their offices - it was business casual. I did dress a little nicer than I do in the office - no suit, just nicer slacks/shirk and shirt, they were all dressed casual.