Managing Teams Today

Learning Outcomes

  • Discuss strategies for managing teams today

Now that we understand some basic approaches and views to managing people, both individually and in team settings, we can use some of these concepts to understand the ways that teams are incorporated into organizations today.

Think about Max Weber’s bureaucratic approach to management versus what Tom Peters proposes in his chaos view of management. On one end of the spectrum, you have a highly- controlled, traditional organization, and on the other, you have a very flexible, unstructured organization.

An arrow indicating that there is a spectrum between traditional structured organizations and highly flexible organizations.

On one end, Weber’s end, of the spectrum, there is high management control, and on the chaos end, that’s less so. Peters recommended we do away with the rigidity of the hierarchical structure to increase flexibility and focus on delivering to customers. So . . . is his suggestion a more team-based organization, with high employee involvement and control? Maybe.

Today’s organizations tend to be more middle-of-the-road in their use of teams. They’ve kept some of their managerial control and traditional structure, and use teams to accomplish work on specific tasks.

An arrow indicating that there is a spectrum between traditional structured organizations and highly flexible organizations. There is a second arrow indicating that the occasional use of teams and employee participation falls in the center of this spectrum.

As organizations move to more team-based structures, the control shifts from management to employees. Upper management still sets the general direction, vision, mission, goals and objectives. But then employees, with that understanding, make decisions and control their own activities. If an organization is going to see a team succeed, they need to:

  • Provide a clear standard of high performance expectations. Management can set expectations—preferably challenging expectations, as we learned earlier—and then teams decide how to accomplish those goals on their own.
  • Provide organizational support. The organization’s structure and culture must support the success of the team. Organizations that forego an all-individual reward system and remove other cultural barriers are more likely to see their teams succeed.
  • Adjust internal and external leadership. Team leaders should guide groups but not necessarily dictate what has to be done.

Researchers like Taylor, Weber and Fayol never got to the point where they could conceive of a team in a working environment. But those concepts that still exist in management principles studied today certainly don’t exclude the use of teams, do they? Teams undoubtedly look for the most efficient way to perform, they reward their members based on achievement and experience, they understand the importance of management decision makers and resource managers in their numbers. Those principles are still at work every day.

Consider the structural elements of an organization as they conceived them and how they change (but don’t disappear) in a team-based organization.

Traditional Organization Team-Based Organization
Formalization All activities and procedures are clearly described in formal written documents Activities and procedures depend on team goals and are not necessarily formally written.
Specialization Individuals and departments specialize in a particular task/function Individuals/teams learn as many skills to perform tasks to do their jobs.
Hierarchy Clear reporting lines with managers having few direct reports Organization is flat, more lateral relationships and only a few levels.
Centralization of decision making Decisions made by managers and passed down to employees Decision is made by a team and coordinated with other teams
Differentiation Departments and their functions are clearly different from one another Differentiation is based on project and not function
Integration Activities are coordinated by managers of different departments Each team is responsible for coordinating with other teams

In spite of all those traditional organizational elements being in place for team-based organizations, there are a lot of growing pains and changes needed if an organization is going to go from a traditional one to one based on teams. What would make an organization do that?

Practice Question

Organizations like Goldman Sachs, American Airlines and Kellogg’s do fine with a traditional organizational structure, with teams used to tackle particular tasks and issues. But some organizations, like Lucent Technologies, have adopted a team-based structure throughout several of their areas.

SEI Investments

SEI Investments in Pennsylvania adopted a team-based organizational structure when its CEO realized that the company lacked competitive advantage. SEI declared their new strategy: Become more responsive to customers than other firms in the industry. The decision to restructure as a team-based organization was the result of that strategy.

SEI decided to form teams specifically to handle a client problem. Once that problem was handled, the team disbanded, and then another one was created to address the next client. As a result, SEI became more profitable, realizing their strategy of becoming more responsive to customers than other companies in the industry.

SEI’s teams were tied to their strategy, and organizations that don’t get specific in attaching team goals to strategy are setting themselves up for failure. When teams aren’t clear on how they’re furthering organizational strategy, they lose focus and motivation. In most cases, those teams won’t live up to expectations. Jon Katzenbach, director at McKinney & Co and team-based organizational expert, points out that it’s not about the numbers for teams. “Teams aren’t motivated by numbers—even big numbers,” he explained. “They’re motivated by something to do in the marketplace, like beating a competitor.

Pre-Industrial Revolution, our economy was based on the textile merchant, the grocer, and all the individual business owners that made their towns go. But once the industrial revolution found its way to the United States, managers were suddenly faced with the task of managing many workers and ensuring that they reached some level of productivity. Science and research improved efficiency, and as the world changed, new views emerged to help managers adapt.

Teams and team-based organizations are not an entirely new concept, but as we continue to innovate and realize what teams can do to help organizations realize their goals, we will continue to use these management approaches to help us move forward.