Organisations often fail to consider the contribution of teams to overall performance. So what can you do to set your team up for success? Drawing on their recent research, Colin Price & Sharon Toye outline some key learnings.
The ability of an organisation to accelerate its performance — in other words, to build and change momentum to get results more quickly than its competitors — is critically dependent on its teams at every level.
Most organisations fail to sufficiently consider the performance of teams when seeking overall performance improvements.
The vast majority of management research on organisations focuses on either the whole organism or the individual leader; the team is forgotten.
And yet teams innately tend toward chaos: personalities work at odds, purpose is muddled, and success factors are vaguely defined. When a team is dysfunctional, its energy dissipates, tensions build up, and fatigue sets in — costing the organisation time, money, and talent.
Teams are under-performing
After studying data on the dynamics and performance of more than 2,000 teams, we have uncovered both bad and good news. The bad news is that most teams are below par and therefore suffer in their ability to build and change momentum quickly.
Senior executive teams are especially poor at this. But on the upside, the energy that can be released by improving a team’s ability to accelerate performance is enormous.
Taking bonus payments as a proxy for corporate performance, our research finds that high-achieving teams enjoy a 23% boost in performance compared with underachieving teams.
Moreover, we find that high-achieving teams reduce costs more quickly, go to market more effectively, and launch products more smoothly.
What makes a team accelerate?
We measured a team’s ability to achieve performance outcomes more quickly than others, through the application of a proprietary questionnaire.
When we observe an accelerating team in an organisation, we are witnessing a team that builds on each member’s energies and talents, generating synergy to deliver a shared purpose.
Teams that are accelerating tend to:
- Mobilise, execute, and transform better — and faster — than their competitors
- Create a shared agenda that produces competitive advantage
- Execute with a metabolic rate that drives outstanding levels of achievement
- Transform continuously, setting stretching objectives and building improvement capabilities that outpace others
- Have high levels of trust and productive conflict
- Operate in a high-challenge, high-support mode
- Focuse on both performance and acceleration
The results of our research reveal several elements and constraints that adversely affect team acceleration, or the measurement of it.
Several lessons can be drawn from the research and applied to team building in organisations of every sector, industry, functional specialty, and place in the corporate hierarchy.
1. Focus on your senior executives
Senior teams tend to be the least likely to be categorised as accelerating among all teams in the organisation.
Indeed, junior teams were 1.6 times more likely to be accelerating than teams composed of director-level members and above. We also found that senior teams rate their team lower on 13 of the 15 tests of brilliant teams than do the members of junior teams.
This finding aligns with previous Heidrick & Struggles research; in a survey of 60 top human resources executives from Fortune 500 companies, only 6% of respondents reported that “the executives in our C-suite are a well-integrated team.”
Why is it worse at the top? While junior teams are generally organised by geography, department, or product line, teams at the top of the organisation are, by definition, doing quite different things: one person runs marketing, another runs manufacturing, another runs finance, and so forth.
At senior level, the challenge is to integrate a portfolio of activities into a coherent whole, and we think the explanation behind the data is that too much of the energy at this level is consumed in dealing with ego problems driven by instincts for self-protection: “I want more power than you,” or “I will agree with your proposal only if you agree with my proposal,” or “I’ll stay off your turf if you stay off mine.”
Ssenior team members have invested a lot in their careers by the time they’ve risen to the top of an organisation, and by virtue of being visible and exposed, they are vulnerable. If they fail, they have a much longer way to fall. Those factors exacerbate the ego problem.
The bottom line: Just when the responsibility and impact of teams become most critical — when the team is operating at the most senior level — these teams are the least likely to have the ability to quickly build and change momentum to perform.
It's important for organisations to make their most senior teams the top priority. The upside of this finding is the sheer scale of opportunity to train and coach your senior teams to improve.
2. Ensure teams connect with your customers
The further a team is away from the customer, the harder that team must work to accelerate its performance.
Teams that have their purpose for existence “in their faces” — that is, customer-facing teams — are 1.4 times more likely to be an accelerating team and 1.3 times more likely to be within reach of this goal compared with internally focused teams.
In addition, customer-facing teams score significantly higher on 14 of the 15 tests of brilliant teams than do non–customer-facing teams.
The bottom line: Connecting with customers is important for team acceleration. For non-customer-facing teams, the story becomes familiar: shared purpose, foresight, and unique commission are what make the difference.
Added to this mix is a focused grip on the work they set their organisation to do. Concentrating on these areas will help to make a real impact on the performance of non-customer-facing teams.
3. Gather varied perspectives on your team
All team members tend to suffer from self-delusion, according to our research.
Compared with the other three respondent groups — team leaders, commissioners (that is, the bosses of the team leaders), and outside stakeholders — team members tend to have a rosier view of their team acceleration and rate the team highest on 10 of the 15 tests of brilliant teams.
This discrepancy between perspective and reality can be ascribed to a concept described in social psychology as the fundamental attribution error — the tendency to emphasise personality rather than external factors to explain behaviour.
For example, if you play 100 games of tennis against somebody who is equally as talented at tennis, you would each expect to win 50 games and lose 50 games.
What’s fascinating, though, is that when that happens, people believe that they won 50 games because of brilliance and talent and skill, and they believe that they lost the other 50 games because of bad luck or even because their opponent cheated.
In other words, we tend to ascribe good qualities to ourselves while rationalising our bad qualities away — or being ignorant of them entirely.
Fundamental attribution error likely explains why the team members in our research — so far, with no exceptions — are more positive about their own team than is everybody else.
The team members are not lying; they genuinely believe what they are saying. But they’re nonetheless wrong. So if you talk only to your team members about how good your team is, expect a deluded and inaccurate point of view.
The bottom line: Involve multiple outsiders in your evaluation of team performance — not just team members but also the team leader, the manager of the team leader, and the stakeholders.
The stakeholders’ views are especially critical because they will decide whether they support the team’s actions, allocate it an adequate budget, and open doors — or not.
4. Question unrealistic optimism
Along the same lines of team members fooling themselves into a rosier view, we found that every team — regardless of its ability to accelerate performance — thinks it will be better in the future.
However, the accelerating teams predict only a small improvement, while the teams that are derailing predict an enormous improvement.
This is known as the optimism bias, which describes how most of us have an unrealistically positive view about the future. It is important to question this optimism because, without intervention, these teams are unlikely to achieve their performance ambitions.
The bottom line: We urge senior executives to be cautious in uncritically accepting rosy predictions of the future. When your organisation’s teams predict their future level of performance, apply a healthy discount to that estimate, because half of those evaluations are based on inherent, excessive optimism.
5. Tailor your approach to team-building
Consider two elite athletes. One is a 125-pound female table tennis player who is quick as lightning and can run around the table in half a second. The other is a 200-pound male heavyweight boxer.
They’re both healthy and incredibly skilled. However, their pattern of acceleration — how they build and change momentum to perform — is completely different, requiring different strategies, muscles, and reflexes.
If the table tennis player gets in the boxing ring, she risks injury, and if the boxer competes in table tennis, he will likely be beaten. Athletes need to be more than just healthy; their pattern of acceleration must be appropriate to the task at hand.
It pays for teams with different starting points to focus on different tests. We looked at the average scores of the 15 tests of brilliant teams across all respondent groups and found the following:
For accelerating teams...
f you want to improve your team's ability to accelerate performance, you may find it helpful to focus on:
- Aligning the team around a shared purpose, as a team that collectively increases its shared purpose score by one point has a 6.9 times greater chance of being an accelerating team
- Building stakeholder influence by connecting team members to all the different constituencies with which the team interacts. This can lead to a 3 times greater chance of being an accelerating team
For lagging teams...
If your team is lagging or derailing, you may find it helpful to focus on:
- Unique commission (a clear understanding of stakeholder expectations), as increasing this score by one point brings about a 6.7 times lower chance of derailing
- Defining what the future plan is to deliver, as increasing the foresight score by one point translates to a 7.7 times lower chance of derailing
- Communicating key messages powerfully across the organisation, as increasing the compelling story score by one point leads to a 3 times lower chance of derailing.
For struggling teams...
Our research found that the top four constraints that thwart accelerated performance relate to purpose. Struggling teams would be wise to focus on tackling these areas first:
- Allowing too many priorities to pull the team in competing directions
- Becoming mired in “troubleshooting” mode and focusing only on today’s problems
- Finding it difficult to integrate the different portfolios of each team member into a coherent purpose
- A tension between the team’s priorities and the expectations of its stakeholders.
The potential benefit of improving team acceleration is huge. Our research reveals several clear action items: team building must begin at the top, adapt for customer-facing and non–customer-facing teams, and question the team’s optimism for both current and future performance.
This article is drawn from The Transformation Mandate: Leadership imperatives for a hyperconnected world. Download the full report.
About the authors
Colin Price is executive vice president and managing partner of Heidrick & Struggles’ Leadership Consulting Practice.
Sharon Toye is a partner in the Leadership Consulting Practice. Both are based in the London office.