Teams at Work

Some organizations  have had great suc- cess with teams, including  increased pro- ductivity, quality improvements, greater innovation, and higher employee satis- faction. FedEx, for example, cut service problems  such as incorrect  bills and lost packages by 13 percent by using teams. At Xerox, production plants using teams reported  a 30 percent increase in produc- tivity.7 A study of team-based organiza- tions in Australia supports the idea that teams provide benefits to both employ- ees and organizations.8  However, simply organizing people into teams does not guarantee their effectiveness. Managers are responsible for creating and nurtur- ing the conditions and processes that  en- able teams to be successful.

In this section, we first define teams and then discuss a model of team effec- tiveness that summarizes the important concepts.


A team is a unit of two or more people who interact and coordinate their work to accomplish  a specific goal.9  This definition has three components. First, two or more people are required.  Teams can be quite large, al- though most have fewer than 15 people. In the survey of manufacturing organizations re- ferred to earlier in the chapter, for example, the average size of teams decreased from 12.7 in 2003 to 10.5 in 2004.10   Second, people in a team have regular interaction.  People who do not interact, such as when standing in line at a lunch counter or riding in an elevator, do not compose a team. Third, people in a team share a performance  goal, whether  to design a new handheld computing device, build a car, or write a textbook. Students often are assigned to teams to do class assignments,  in which  case, the purpose is to perform the assignment and receive an acceptable grade.

Although a team  is a  group of people, the two terms  are not interchangeable. An employer,  a teacher, or a coach can put together  a group of people and never build a team.

Exhibit 14.1 lists the primary differences between groups and teams.

One example of a true team comes from the military, where U.S. Navy surgeons, nurses, anesthesiologists, and technicians make up eight-person forward surgical teams that oper- ated for the first time ever in combat during Operation Iraqi Freedom. These teams were scattered over Iraq and were able to move to new locations in four trucks and be set up within an hour. With a goal of saving the 15 to 20 percent of wounded soldiers and civil- ians who will die unless they receive critical  care within 24 hours, members of these teams smoothly coordinated their activities to accomplish a critical  shared mission.11

The sports world  also provides many examples of the importance of teamwork. The 2004 U.S. Olympic  basketball team was made up entirely of superstar players, yet the members never  coalesced  as a team, instead functioning  as a group  of individual  players. The team came in third and lost to Lithuania. In contrast, the 1980 U.S. hockey team that beat the Soviets to win gold at the Lake Placid Olympics consisted of a bunch  of no-name players. Coach Herb Brooks  picked players based on their personal chemistry—how  they worked together as a team—rather than on their individual abilities and egos.12 Creating more effec- tive teams is a goal not always reached, as described  in the following Business Blooper.


Some of the factors associated with team effectiveness are illustrated in Exhibit 14.2. Work team effectiveness is based on three outcomes—productive output, personal satisfaction, and the capacity to adapt and learn.13  Satisfaction pertains to the team’s ability to meet the personal needs of its members and hence maintain  their membership and commitment. Productive output pertains to the quality and quantity of task outputs  as defined  by team goals. Capacity to adapt and learn refers to the ability of teams to bring greater knowledge and skills to job tasks and enhance the potential of the organization to respond to new threats or opportunities in the environment.

The factors that influence team effectiveness begin with the organizational context.14 The organizational context in which the team operates is described in other chapters and includes  such factors as structure,  strategy, environment,   culture, and reward systems. Within that context, managers define teams. Important team characteristics are the type of team, the team structure, and team composition.  Managers must decide when to create permanent teams within the formal structure and when to use a temporary task team. Fac- tors such as the diversity of the team in terms of gender and race, as well as knowledge, skills, and attitudes, can have a tremendous impact on team processes and effectiveness.15

Team size and roles also are important. Managers strive for the right mix of knowledge and skills for the task to be performed and consider whether  a team is the best way to accom- plish the task. If costs outweigh  benefits,  managers may want to assign an individual employee to the task.

These  team  characteristics  influence  processes internal to the team, which, in turn, affect output,  satisfaction, and the team’s contribution to organizational adaptability. Good team leaders understand  and manage stages of team development, cohesiveness, norms, and conflict to build an effective  team. These processes are influenced by team and organi- zational characteristics and by the ability of members and leaders to direct these processes in a positive  manner.

The model of team effectiveness in Exhibit 14.2 is the basis for this chapter. In the fol- lowing sections, we will examine types of organizational  teams, team structure, internal processes, and the benefits  of effective work teams.

Source: Daft Richard L., Marcic Dorothy (2009), Understanding Management, South-Western College Pub; 8th edition.

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