How effective are your teams?(PART II)
Give Your Teams Time to Meet on Team Activities
A recent survey conducted in the United States by Interaction Associates of Fortune 500 Organizations stated that the number one reason for team failure was not giving team members enough time to work on their team assignments versus their normal working duties.
If the teams are created for a special project that is in addition to their regular daily work then it is important that management allows for the team to have the resources and time needed to carry out the new function. Senior management must make sure that their teams have the capital, the competencies, the time and other tools to complete their desired results.
The Team and Economies of Scale
If the team itself is a profit center, then it must clearly understand its business model in order to expand the business. This may, for example, involve looking at how to build long-term contracts/client relationships, quantifying value to clients in order to extract price, sales volume and cost behaviors over a certain volume range. Profit center teams need to have time for innovation for both the incremental and radical changes that will need to take place in their models as customer needs change. Do your profit center teams know the operational levers of how profit is really generated and expanded?
Diversity Can Help
Whenever it is practical and makes sense, teams should have people from different backgrounds working together. Organizations get into trouble when 'groupthink' pervades the team. Team leaders need to show members that diversity provides strength, but respect and tolerance for different viewpoints needs to be part of the process.
Meeting Management is Critical
This is a topic all in itself. Teams meet and make decisions together much more often than in a 'command and control' environment. It is therefore critical that meeting management be developed as a competency in a team-based organization. This means calling meetings only when needed, having relevant material distributed, a specific written agenda provided to members before a meeting, a leader of the team who acts as a facilitator, keeping discussions within time boundaries, that the decision making rules are known by all participants, that action steps are recorded and that follow-up occurs.
More Insight from Information Not Less
Team based structures are information-rich environments in which high levels of trust need to exist. This means managers do not hoard information but distribute it continually. A key part of the effective use of certain information, such as financial results or balanced scorecard results, is the time given to ensure that the team understands exactly how to interpret the results.
Compensate as a Team
If you want certain behaviors to occur, then you need to incentivize for it. There are many methods of team compensation. If the team is a profit center, an operating profit pool tied to individual and team goals may be the answer. For a support team it may be tied directly to individual and or group goal completion that is weighted by importance.
For example, a profit center has an operating profit of zł.1,000,000. Eight percent is given as a potential bonus pool to the team. The team leader then divides this zł.80,000 among the three team members. For example, 40/40/20. This means the employee has eligibility to 40 percent of the operating profit pool. However, they may also have a goal completion list as well and their take on the 40 percent of the eight percent is based on the amount of weighted quantified goals they complete. There are, of course, infinite amounts of ways in which to compensate teams. A key for profit center incentivization is to show the team members how to leverage off the contribution margin/fixed cost of their particular business model to build stronger earnings streams (not just sales!) for the company and make more money for themselves.
Communicate Team Results Continually
Teams are focused on real results. It is essential that leaders concentrate on the end results and help facilitate the team to let them find the answers they need to get the desired results. It may also make sense to use company-wide team comparisons of results and present them regularly to the entire company. Teams should see their overall results and company leaders may tie those results into the overall company picture. This can be highly motivating for people to see how they contribute to the overall organization's results.
Creating New Team Competencies
A team's continued success is directly related to the amount of competent team members in it. Team dynamics are also about growth and learning new capabilities. In order to give confidence to a team there should be focus on first assessing the team's ability to perform the new task. What additional training support will they need to complete the new task? After this assessment there should be a specific plan to enable the team to take over the new task with continual monitoring. Team participation is about growth, including the team's professional development, but this needs to be managed as a process.
Team Self-Critique
Teams need to have a formal standard self-critique on their effectiveness on a regular basis. However, remember this should only be done by the team leader if there is real interest in using the feedback for real improvement results. Feedback without action loses credibility with team members. Specific questions for the team to grade itself on a 1-5 scale, for example, may include:
- The team knows exactly what results it must achieve;
- Every team member has a clear idea of the team's goals and their role within it;
- Everyone is involved in the decisions they have to make;
- Meetings are held on time, with clear agendas, decision-making is understood, clear actions are taken and followed up on;
- All team members respect each other;
- The feelings among team members tend to pull them together;
- Everyone's opinion gets listened to.
Conclusion
How effective are the teams in your organization? Do they have high degrees of trust and accountability? Does everyone know their results? Only through leveraging off from the organization can you build real long-term value for clients, increase revenue, margins and cash flows. Building effective teams is a lot of hard work, but it is immeasurably more rewarding than cost-cutting and is a foundation for building real long-term value.
Peter Strupp is Chief Executive Officer of Intersource Holding, a human capital services group based in Warsaw
A recent survey conducted in the United States by Interaction Associates of Fortune 500 Organizations stated that the number one reason for team failure was not giving team members enough time to work on their team assignments versus their normal working duties.
If the teams are created for a special project that is in addition to their regular daily work then it is important that management allows for the team to have the resources and time needed to carry out the new function. Senior management must make sure that their teams have the capital, the competencies, the time and other tools to complete their desired results.
The Team and Economies of Scale
If the team itself is a profit center, then it must clearly understand its business model in order to expand the business. This may, for example, involve looking at how to build long-term contracts/client relationships, quantifying value to clients in order to extract price, sales volume and cost behaviors over a certain volume range. Profit center teams need to have time for innovation for both the incremental and radical changes that will need to take place in their models as customer needs change. Do your profit center teams know the operational levers of how profit is really generated and expanded?
Diversity Can Help
Whenever it is practical and makes sense, teams should have people from different backgrounds working together. Organizations get into trouble when 'groupthink' pervades the team. Team leaders need to show members that diversity provides strength, but respect and tolerance for different viewpoints needs to be part of the process.
Meeting Management is Critical
This is a topic all in itself. Teams meet and make decisions together much more often than in a 'command and control' environment. It is therefore critical that meeting management be developed as a competency in a team-based organization. This means calling meetings only when needed, having relevant material distributed, a specific written agenda provided to members before a meeting, a leader of the team who acts as a facilitator, keeping discussions within time boundaries, that the decision making rules are known by all participants, that action steps are recorded and that follow-up occurs.
More Insight from Information Not Less
Team based structures are information-rich environments in which high levels of trust need to exist. This means managers do not hoard information but distribute it continually. A key part of the effective use of certain information, such as financial results or balanced scorecard results, is the time given to ensure that the team understands exactly how to interpret the results.
Compensate as a Team
If you want certain behaviors to occur, then you need to incentivize for it. There are many methods of team compensation. If the team is a profit center, an operating profit pool tied to individual and team goals may be the answer. For a support team it may be tied directly to individual and or group goal completion that is weighted by importance.
For example, a profit center has an operating profit of zł.1,000,000. Eight percent is given as a potential bonus pool to the team. The team leader then divides this zł.80,000 among the three team members. For example, 40/40/20. This means the employee has eligibility to 40 percent of the operating profit pool. However, they may also have a goal completion list as well and their take on the 40 percent of the eight percent is based on the amount of weighted quantified goals they complete. There are, of course, infinite amounts of ways in which to compensate teams. A key for profit center incentivization is to show the team members how to leverage off the contribution margin/fixed cost of their particular business model to build stronger earnings streams (not just sales!) for the company and make more money for themselves.
Communicate Team Results Continually
Teams are focused on real results. It is essential that leaders concentrate on the end results and help facilitate the team to let them find the answers they need to get the desired results. It may also make sense to use company-wide team comparisons of results and present them regularly to the entire company. Teams should see their overall results and company leaders may tie those results into the overall company picture. This can be highly motivating for people to see how they contribute to the overall organization's results.
Creating New Team Competencies
A team's continued success is directly related to the amount of competent team members in it. Team dynamics are also about growth and learning new capabilities. In order to give confidence to a team there should be focus on first assessing the team's ability to perform the new task. What additional training support will they need to complete the new task? After this assessment there should be a specific plan to enable the team to take over the new task with continual monitoring. Team participation is about growth, including the team's professional development, but this needs to be managed as a process.
Team Self-Critique
Teams need to have a formal standard self-critique on their effectiveness on a regular basis. However, remember this should only be done by the team leader if there is real interest in using the feedback for real improvement results. Feedback without action loses credibility with team members. Specific questions for the team to grade itself on a 1-5 scale, for example, may include:
- The team knows exactly what results it must achieve;
- Every team member has a clear idea of the team's goals and their role within it;
- Everyone is involved in the decisions they have to make;
- Meetings are held on time, with clear agendas, decision-making is understood, clear actions are taken and followed up on;
- All team members respect each other;
- The feelings among team members tend to pull them together;
- Everyone's opinion gets listened to.
Conclusion
How effective are the teams in your organization? Do they have high degrees of trust and accountability? Does everyone know their results? Only through leveraging off from the organization can you build real long-term value for clients, increase revenue, margins and cash flows. Building effective teams is a lot of hard work, but it is immeasurably more rewarding than cost-cutting and is a foundation for building real long-term value.
Peter Strupp is Chief Executive Officer of Intersource Holding, a human capital services group based in Warsaw
