Transformation through teamwork: the path to the new organization?

Introduction

A strong interest in organizational transformation is apparent in managerial literature, popular books and themes of recent conferences and seminars. Surveys confirm that a majority of executives believe their organization to be faced with revolutionary change, and that the pace of change is increasing. One observer has called the current era "the nanosecond nineties" - to symbolize a widespread obsession with speed and technology. Complexity is increasing as a host of new products is launched and information and process technologies advance in rapid leaps. As in previous times, managerial fads and "quick fixes" abound.

Teamwork is one of the most common prescriptions for coping with such change. Advocates of business process redesign, total quality management, cycle-time reduction, product innovation and service improvement all trumpet the virtues of cross-functional teams and collaborative work ventures. Benefits of teamwork typically mentioned include:

* breaking down boundaries to effective communication and collaboration;

* increasing the speed of action, raising the level of commitment;

* creating a more customer-focused culture; and

* increasing organizational adaptability and flexibility.

Adoption of teamwork as a lever for change has been reported in all kinds of settings including financial services (e.g. J.P. Morgan, Chase Manhattan), telecommunications (Motorola, GTE), chemicals (Monsanto), oil (British Petroleum), food processing (Purdue Farms, Johnsonville Foods), high-tech products (Xerox, IBM, HP), health care (Baxter), government, military and not-for-profit institutions.

Teamwork is neither new nor risk free. There have been notable disappointments and critical re-evaluation of teamwork since Kidder[1] and Reich[2] reported heroic successful examples in the early and mid-1980s. For instance: although Florida Light and Power was the first non-Japanese winner of the Deming prize for quality in 1989, with 1,900 quality teams involving three-quarters of employees, in 1990 CEO Jim Broadhead abandoned most of these quality process teams, citing a loss of customer focus and excessive rigidity as the reason for his decision. Nahavandi and Aranda[3] have also cautioned against transplanting notions of teamwork from observation of Japanese firms to the more individualistic cultural and social setting of North America or the UK.

High-energy team effort has enormous potential for promoting change. However, it is rapidly becoming an overworked nostrum the benefits are all-too-often exaggerated and the difficulties underestimated[4]. Despite the instances of outstanding success by empowered and self-managed teams, there are numerous (but less well publicized) disappointments. Extraordinary efforts by dedicated and creative individuals operating within a loose network and supportive organizational culture have often achieved far more rapid results than formalized project teams. Interestingly, a recent well-respected study of exceptional long-run organizational performance by Collins and Porras[5] did not identify teamwork and team organization in a list of "successful habits". Teamwork has too often been over-promoted as a solution to problems of all types. It is by no means a guarantee of success.

This article presents a timely evaluation of the success of teamwork in practice and the predicted future use of teams based on interviews and a mail survey of executives in UK organizations. The study also addressed enabling factors for teamwork, and the use of technology supporting group communication and collaborative work, i.e. "groupware". Suggestions for improving the practice of teamwork are offered within the context of an emerging, more open and flexible form of organization. The definition of "team" considered here is consistent with that of Katzenbach and Smith[6], i.e. a team is a small number of people with complementary skills who are committed to a common purpose, set of performance goals and approach for which they hold themselves mutually accountable.

Issues and challenges

The driving forces for change are well known: new technology, new types of competition, economic uncertainty, evolving customer needs, deregulation, globalization and fragmentation of markets. Compared to previous eras, the business environment is frequently seen as more complex, unpredictable and fast moving. In response, many organizations have undertaken clean-slate redesign of their business systems and fundamental reinvention of the ways in which they compete[7]. Strategic planners now pay more attention to developing the strengths and internal resources of the firm than in previous eras. More emphasis is being given to development of core competences, organizational learning, business process redesign, networking and development of characteristics such as agility[8] and flexibility. The implementation of new structures, systems and work processes is critical to the success of such change strategies (see examples in the Appendix). However, we argue that: restructuring to a team-based organization should not be attempted without first considering the nature of the firm, tasks to be accomplished and possible roadblocks.

Firm and industry differences

Different settings may be more or less appropriate for teamwork. In certain organizations precise and co-ordinated group effort is essential, e.g. hospital operating rooms, airlines and global courier services. Elsewhere, work may be more structured around individual contribution, e.g. foreign exchange and securities trading in financial institutions. Unfortunately, advocates for team approaches frequently fail to emphasize the importance of situational and firm-specific factors in determining the mode of work.

Each firm is also uniquely shaped by its history, business domain, culture and leadership. Even within a single firm different divisions and departments have different histories and cultures. These may present more or less fertile ground for successful group efforts and different challenges for the team leader. Teamwork lessons learned in one organization may not immediately be transferable to another. Contingency theorists[9] argue that new structures and approaches must take account of industry and firm differences. In short, "one size does not fit all". What works for General Electric or Xerox may not be so …