HIGH-PERFORMANCE
THE ORGANIZATION
BEST OF HBR
1993
It w o n t surprise anyone to find an article on teams by Jon Katzenbach and Douglas Smith figuring into an issue devoted to high performance. While Peter Drucker may have been the first to point out that a team-based organization can be highly effective, Katzenbach and Smith's work made it possible for companies to implement the idea. In this groundbreaking 1993 article, the authors say that if managers want tomakebetterdecisionsaboutteamsjthey must be clear about what a team is. They define a team as"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."That definition lays down the discipline that teams must share to be effective. Katzenbach and Smith discuss the four elements - common commitment and purpose, performance goals, complementary skills, and mutual accountability - that make teams function. They also classify teams into three varieties - teams that recommend things, teams that make or do things, and teams that run things - and describe how each type faces different challenges.
The Discipline of Teams
by Jon R. Katzenbach and Douglas K. Smith
I arly in the 1980s, Bill Greenwood
What makes the difference between a team that performs and one that doesn't?
(d a small band of rebel railroaders )n most of the top management of Burlington Northern and created a multibillion-dollar business in "piggybacking" rail services despite widespread resistance, even resentment, within the company. The Medical Products Group at Hewlett-Packard owes most of its leading performance to the remarkable efforts of Dean Morton, Lew Platt, Ben Holmes, Dick Alberding, and a handful of their colleagues who revitalized a health care business that most others had written off. At Knight Ridder, Jim Batten's "customer obsession" vision took root at the Tallahassee Democrat when 14 frontline enthusiasts turned a charter to eliminate errors into a mission
of major change and took the entire paper along with them. Such are the stories and the work of teams - real teams that perform, not amorphous groups that we call teams because we think that the label is motivating and energizing. The difference between teams that perform and other groups that don't is a subject to which most of us pay far too little attention. Part of the problem is that "team" is a word and concept so familiar to everyone. (See the exhibit "Not All Groups Are Teams: How to Tell the Difference.") Or at least that's what we thought when we set out to do research for our book The Wisdom ofTeams (HarperBusiness, 1993)- We wanted to discover what differentiates various levels of
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THE HIGH-PERFORMANCE ORGANIZATION expressed by others, giving others the benefit of the doubt, providing support, and recognizing the interests and achievements of others. Such values help teams perform, and they also promote individual performance as well as the performance of an entire organization. But teamwork values by themselves are not exclusive to teams, nor are they enough to ensure team performance. (See the sidebar "Building Team Performance.") Nor is a team just any group working together. Committees, councils, and task forces are not necessarily teams. Groups do not become teams simply because that is what someone calls them. The entire workforce of any large and complex organization is never a team, but think about how often that platitude is offered up. To understand how teams deliver extra performance, we must distinguish between teams and other forms of working groups. That distinction turns on performance results. A working group's performance is a function of what its members do as individuals. A team's performance includes both individual results and what we call "collective work products." A collective work product is what two or more members must work on together, such as interviews, surveys, or experiments. Whatever it is, a collective work product reflects the joint, real contribution of team members. Working groups are both prevalent and effective in large organizations where individual accountability is most important. The best working groups come together to share information, perspectives, and insights; to make decisions that help each person do his or her job better; and to reinforce individual performance standards. But the focus is always on individual goals and accountabilities. Working-group members don't take responsibility for results other than their own. Nor do they try to develop incremental performance contributions requiring the combined work of two or more members. Teams differ fundamentally from working groups because they require both individual and mutual accountability. Teams rely on more than group discussion, debate, and decision, on more than sharing infonnation and best-practice performance standards. Teams produce discrete work products through the joint contributions of their members. This is what makes possible perfonnance levels greater than the sum of all the individual bests of team members. Simply stated, a team is more than the sum of its parts. The first step in developing a disciplined approach to team management is to think about teams as discrete units of performance and not just as positive sets of values. Having observed and worked with scores of teams in action, both successes and failures, we offer the following. Think of it as a working defi-
team performance, where and how teams work best, and what top management can do to enhance their effectiveness. We talked with hundreds of people on more than 50 different teams in 30 companies and beyond, from Motorola and Hewlett-Packard to Operation Desert Storm and the Girl Scouts. We found that there is a basic discipline that makes teams work. We also found that teams and good performance are inseparable: You cannot have one without the other. But people use the word "team" so loosely that it gets in the way of learning and applying the discipline that leads to good performance. For managers to make better decisions about whether, when, or how to encourage and use teams, it is important to be more precise about what a team is and what it isn't. Most executives advocate teamwork. And they should. Teamwork represents a set of values that encourage listening and responding constructively to views
Not All Groups Are Teams: How to Tell the Difference
Working Group > Strong, clearly focused leader > Individual accountability > The group's purpose is the same as the broader organizational mission > Individual work products > Runs efficient meetings > Measures its effectiveness indirectly by its influence on others (such as financial performance of the business) > Discusses, decides, and delegates Team > Shared leadership roles > Individual and mutual accountability > Specific team purpose that the team itself delivers > Collective work products > Encourages open-ended discussion and active problem-solving meetings > Measures performance directly by assessing collective work products > Discusses, decides, and does real work together
Jon R. Katzenbach is a founder and senior partner of Katzenbach Partners, a strategic and organizational consulting firm, and a former director of McKinsey & Company. His most recent book is Why Pride Matters More Than Money: The Power ofthe World's Greatest Motivational Force (Crown Business, 2003). Douglas K. Smith is an organizational consultant and a former partner at McKinsey & Company. His most recent book is On Value and Values: Thinking Differently About We in an Age of Me (Financial Times Prentice Hall, 2004)-
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The Discipline of Teams* BEST OF HBR
nition or, better still, an essential discipline that real teams share: A team is a
small number of people with complementary skills who are committed to a common purpose, set of performance goats, and approach for which they hold themselves mutually accountable.
The essence of a team is common commitment. Without it, groups perform as individuals; with it, they become a powerful unit of collective performance. This kind of commitment requires a purpose in which team members can believe. Whether the purpose is to "transform the contributions of suppliers into the satisfaction of customers," to "make our company one we can be proud of again," or to"prove that all children can leam," credible team purposes have an element related to winning, being first, revolutionizing, or being on the cutting edge. Teams develop direction, momentum, and commitment by working to shape a meaningful purpose. Building ownership and commitment to team purpose, however, is not incompatible with taking initial direction from outside the team. The often-asserted assumption that a team cannot "own" its purpose unless management leaves It alone actually confuses more potential teams than it helps. In fact, it is the exceptional case -for example, entrepreneurial situations-when a team creates a purpose entirely on its own. Most successful teams shape their purposes in response to a demand or opportunity put in their path, usually by higher management. This helps teams get started by broadly framing the company's performance expectation. Management is responsible for clarifying the charter, rationale, and performance challenge for the team, but management must also leave enough flexibility for the team to develop commitment around its own spin on that purpose, set of specific goals, timing, and approach. The best teams invest a tremendous amount of time and effort exploring, shaping, and agreeing on a purpose that belongs to them both collectively and individually. This "purposing" activity continues throughout the life of the
JULY-AUGUST 2005
People use the word "team" so loosely that it gets in the way of learning and applying the discipline that leads to good performance.
team. By contrast, failed teams rarely develop a common purpose. For whatever reason - an insufficient focus on performance, lack of effort, poor leadership-they do not coalesce around a challenging aspiration. The best teams also translate their common purpose into specific performance goals, such as reducing the reject rate from suppliers by 50% or increasing the math scores of graduates from 40% to 95%- Indeed, if a team fails to establish specific performance goals or if those goals do not relate directly to the team's overall purpose, team members become confused, pull apart, and revert to mediocre performance. By contrast, when purposes and goals build on one another and are combined with team commitment, they become a powerful engine of performance. Transforming broad directives into specific and measurable performance goals is the surest first step for a team trying to shape a purpose meaningful to its members. Specific goals, such as getting a new product to market in less than half the normal time, responding to all customers within 24 hours, or achieving a zero-defect rate while simultaneously cutting costs by 40%, all providefirmfootholds for teams. There are several reasons: Specific team-performance goals help define a set of work products that are different both from an otganization-wide 165
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Set and seize upon a few immediate performanceoriented tasks and goals. Most effective teams trace their advancement to key performance-oriented events. Such events can be set in motion by immediately establishing a few challenging goals that can be reached early on. There is no such thing as a real team without performance results, so the sooner such results occur, the sooner the team congeals. Challenge the group regularly with fresh facts and information. New information causes a team to redefine and enrich its understanding ofthe performance challenge, thereby helping the team shape a common purpose, set clearer goals, and improve its common approach. A plant quality improvement team knew the cost of poor quality was high, but it wasn't until they researched the different types of defects and put a price tag on each one that they knew where to go next. Conversely, teams err when they assume that all the information needed exists in the collective experience and knowledge of their members. Spend lots of time together. Common sense tells us that team members must spend a lot of time together, scheduled and unscheduled, especially in the beginning. Indeed, creative insights as well as personal bonding require impromptu and casual interactions just as much as analyzing spreadsheets and interviewing customers. Busy executives and managers too often intentionally minimize the time they spend together. The successful teams we've observed ali gave themselves the time to learn to be a team. This time need not always be spent together physically; electronic,
Building Team Performance
A
lthough there is no guaranteed how-to recipe for building team performance, we observed a number \ of approaches shared by many successful teams.
Establish urgency, demanding performance stan-
dards, and direction. All team members need to believe the team has urgent and worthwhile purposes, and they want to know what the expectations are. Indeed, the more urgent and meaningful the rationale, the more likely it is that the team will live up to its performance potential, as was the case for a customer-service team that was told that further growth forthe entire company would be impossible without major improvements in that area. Teams work best in a compelling context. That is why companies with strong performance ethics usually form teams readily. Select members for skill and skill potential, not personality. No team succeeds without all the skills needed to meet its purpose and performance goals. Yet most teams figure out the skills they will need after they are formed. The wise manager will choose people for their existing skills and their potential to improve existing skills and learn new ones. Pay particular attention to first meetings and actions. Initial impressions always mean a great deal. When potential teams first gather, everyone monitors the signals given by others to confirm, suspend, or dispel assumptions and concerns. They pay particular attention to those in authority: the team leader and any executives who set up, oversee, or otherwise influence the team. And, as
always, what such leaders do is more important than what they say. If a senior executive leaves the team kickofftotake a phone call ten minutes after the session has begun and he never returns, people get the message. Set some clear rules of behavior. All effective teams develop rules of conduct at the outset to help them achieve their purpose and performance goals. The most critical initial rules pertain to attendance (for example, "no interruptions to take phone calls"), discussion ("no sacred cows"), confidentiality ("the oniy things to leave this room are what we agree on"), analytic approach ("facts are friendly"), end-product orientation ("everyone gets assignments and does them"), constructive confrontation ("nofingerpointing"), and, often the most important, contributions ("everyone does real work").
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fax, and phone time can also count as time spent together. Exploit the power of positive feedback, recognition, and reward. Positive reinforcement works as well in a team context as elsewhere. Civing out"go!d stars" helps shape new behaviors critical to team performance. If people in thegroup, for example, are alert to a shy person's initial efforts to speak up and contribute, they can give the honest positive reinforcement that encourages continued contributions. There are many ways to recognize and reward team performance beyond direct compensation, from having a senior executive speak directly to the team about the urgency of its mission to using awards to recognize contributions. Ultimately, however, the satisfaction shared by a team in its own performance becomes the most cherished reward.
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mission and from individual job objec- and other stripes fade into the backtives. As a result, such work products re- ground. The teams that succeed evaluquire the collective effort of team mem- ate what and how each individual can bers to make something specific happen best contribute to the team's goal and, that, in and of itself, adds real value to more important, do so in terms of the results. By contrast, simply gathering perfonnance objective itself rather than from time to time to make decisions will a person's status or personality. not sustain team performance. Specific goals allow a team to achieve The specificity of performance ob- small wins as it pursues its broader purjectives facilitates clear communication pose. These small wins are invaluable and constructive conflict within the to building commitment and overcomteam. When a plant-level team, for ex- ing the inevitable obstacles that get in ample, sets a goal of reducing average the way of a long-term purpose. For exmachine changeover time to two hours, ample, the Knight Ridder team menthe clarity ofthe goal forces the team to tioned at the outset turned a narrow goal concentrate on what it would take ei- to eliminate errors into a compelling ther to achieve or to reconsider the goal. customer service purpose. When such goals are clear, discussions Performance goals are compelling. can focus on how to pursue them or They are symbols of accomplishment that whether to change them; when goals motivate and energize. They challenge are ambiguous or nonexistent, such dis- the people on a team to commit themcussions are much less productive. selves, as a team, to make a difference.
for success. A large number of people, say 50 or more, can theoretically become a team. But groups of such size are more likely to break into subteams rather than function as a single unit. Why? Large numbers of people have trouble interacting constructively as a group, much less doing real work together. Ten people are far more likely than 50 to work through their individual, functional, and hierarchical differences toward a common plan and to hold themselves jointly accountable for the results. Large groups also face logistical issues, such as finding enough physical space and time to meet. And they confront more complex constraints, like crowd or herd behaviors, which prevent the intense sharing of viewpoints needed to build a team. As a result, when they try to develop a common purpose,
For managers to make better decisions about whether, when, or how to encourage and use teams, it is important to be more precise about what a team is and what it isn't.
The attainability of specific goals helps teams maintain their focus on getting results. A product-development team at Eli Lilly's Peripheral Systems Division set definite yardsticks for the market introduction of an ultrasonic probe to help doctors locate deep veins and arteries. The probe had to have an audible signal through a specified depth of tissue, be capable of being manufactured at a rate of lOO per day, and have a unit cost less than a preestablished amount. Because the team could measure its progress against each of these specific objectives, the team knew throughout the development process where it stood. Either it had achieved its goals or not. - As Outward Bound and other teambuilding programs illustrate, specific objectives have a leveling effect conducive to team behavior. When a small group of people challenge themselves to get over a wall or to reduce cycle time by 50%, their respective titles, perks.
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Drama, urgency, and a healthy fear of failure combine to drive teams that have their collective eye on an attainable, but challenging, goal. Nobody but the team can make it happen. It's their challenge. The combination of purpose and specific goals is essential to performance. Each depends on the other to remain relevant and vital. Clear performance goals help a team keep track of progress and hold itself accountable; the broader, even nobler, aspirations in a team's purpose supply both meaning emotional and energy. Virtually all effective teams we have met, read or heard about, or been members of have ranged between two and 25 people. For example, the Burlington Northern piggybacking team had seven members, and the Knight Ridder newspaper team had 14. The majority of them have numbered less than ten. Small size is admittedly more of a pragmatic guide than an absolute necessity
they usually produce only superficial "missions" and well-meaning intentions that cannot be translated into concrete objectives. They tend fairly quickly to reach a point when meetings become a chore, a clear sign that most ofthe people in the group are uncertain why they have gathered, beyond some notion of getting along better. Anyone who has been through one of these exercises understands how frustrating it can be. This kind of failure tends to foster cynicism, which gets in the way of future team efforts. In addition to finding the right size, teams must develop the right mix of skills; that is, each of the complementary skills necessary to do the team's job. As obvious as it sounds, it is a common failing in potential teams. Skill requirements fall into three fairly self-evident categories. Technical or Functional Expertise. It would make little sense for a group of 167
THE HIGH-PERFORMANCE ORGANIZATION fact that their performance challenge was a marketing one. In fact, we discovered that teams are powerful vehicles for developing the skills needed to meet the team's performance challenge. Accordingly, team member selection ought to ride as much on skill potential as on skills already proven. Effective teams develop strong commitment to a common approach; that is, to how they will work together to accomplish their purpose. Team members must agree on who will do particular jobs, how schedules will be set and adhered to, what skills need to be developed, how continuing membership in the team is to be earned, and how the group will make and modify decisions. This element of commitment is as important to team performance as the team's commitment to its purpose and goals. Agreeing on the specifics of work and how they fit together to integrate individual skills and advance team performance lies at the heart of shaping a
doctors to litigate an employment discrimination case in a court of law. Yet teams of doctors and lawyers often try medical malpractice or personal injury cases. Similarly, product development groups that include only marketers or engineers are less likely to succeed than those with the complementary skills of both. Problem-Solving and Decision-Making Skills. Teams must be able to identify the problems and opportunities they face, evaluate the options they have for moving forward, and then make necessary trade-offs and decisions about how to proceed. Most teams need some members with these skills to begin with, although many will develop them best on the job. Interpersonal Skills. Common understanding and purpose cannot arise without effective communication and constructive conflict, which in turn depend on interpersonal skills. These skills include risk taking, helpful criticism,
all its human resources to a common purpose can a team develop and agree on the best approach to achieve its goals. At the heart of such long and, at times, difficult interactions lies a commitment-building process in which the team candidly explores who is best suited to each task as well as how individual roles will come together. In effect, the team establishes a social contract among members that relates to their purpose and guides and obligates how they must work together. No group ever becomes a team until it can hold itself accountable as a team. Like common purpose and approach, mutual accountability is a stiff test. Think, for example, about the subtle but critical difference between "the boss holds me accountable" and "we hold ourselves accountable." The first case can lead to the second, but without the second, there can be no team. Companies like Hewlett-Packard and Motorola have an ingrained performance ethic that enables teams to form organically whenever there is a clear performance challenge requiring colA team opportunity exists anywhere hierarchy lective rather than individual effort. In these companies, the factor of muor organizational boundaries inhibit the skills tual accountability is commonplace. and perspectives needed for optimal results. "Being in the boat together" is how their performance game is played. At its core, team accountability Is objectivity, active listening, giving the common approach. It is perhaps self- about the sincere promises we make to benefit of the doubt, and recogniz- evident that an approach that delegates ourselves and others, promises that uning the interests and achievements of all the real work to a few members (or derpin two critical aspects of effective staff outsiders) and thus relies on reviews teams: commitment and trust. Most of others. Obviously, a team cannot get started and meetings for its only"work together" us enter a potential team situation cauwithout some minimum complement aspects, cannot sustain a real team. tiously because ingrained individualof skills, especially technical and func- Every member of a successful team does ism and experience discourage us from tional ones. Still,think about how often equivalent amounts of real work; all putting our fates in the hands of others you've been part of a team whose mem- members, including the team leader, or accepting responsibility for others. bers were chosen primarily on the basis contribute In concrete ways to the Teams do not succeed by ignoring or of personal compatibility or formal po- team's work product. This is a very im- wishing away such behavior. sition in the organization, and in which portant element ofthe emotional logic Mutual accountability cannot be cothe skill mix of its members wasn't given that drives team performance. erced any more than people can be made much thought. When individuals approach a team to trust one another. But when a team It is equally common to overempha- situation, especially in a business set- shares a common purpose, goals, and size skills in team selection. Yet in all the ting, each has preexisting job assign- approach, mutual accountability grows successful teams we've encountered, ments as well as strengths and weak- as a natural counterpart. Accountabilnot one had all the needed skills at the nesses reflecting a variety of talents, ity arises from and reinforces the time, outset. The Burlington Northern team, backgrounds, personalities, and preju- energy, and action invested in figuring for example, initially had no members dices. Only through the mutual discov- out what the team is trying to accomwho were skilled marketers despite the ery and understanding of how to apply plish and how best to get it done. 168
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The Discipline of Teams B E S T OF H B R
When people work together toward a common objective, trust and commitment follow. Consequently, teams enjoying a strong common purpose and approach inevitably hold themselves responsible, both as individuals and as a team, for the team's performance. This sense of mutual accountability also produces the rich rewards of mutual achievement in which all members share. What we heard over and over from members of effective teams is that they found the experience energizing and motivating in ways that their "normal" jobs never could match. On the other hand, groups established primarily for the sake of becoming a team or for job enhancement, communication, organizational effectiveness, or excellence rarely become effective teams, as demonstrated by the bad feelings left in many companies after experimenting with quality circles that never translated "quality" into specific goals. Only when appropriate performance goals are set does the process of
discussing the goals and the approaches that's required to get recommendations to them give team members a clearer implemented. and clearer choice: They can disagree The key to the first issue lies in the with a goal and the path that the team clarity of the team's charter and the selects and, in effect, opt out, or they composition of its membership. In adcan pitch in and become accountable dition to wanting to know why and with and to their teammates. how their efforts are important, task The discipline of teams we've out- forces need a clear definition of whom lined is critical to the success of ail teams. management expects to participate and Yet it is also useful to go one step fur- the time commitment required. Manther. Most teams can be classified in one agement can help by ensuring that the of three ways: teams that recommend team includes people with the skills and things, teams that make or do things, influence necessary for crafting practical and teams that run things. In our expe- recommendations that will carry weight rience, each type faces a characteristic throughout the organization. Moreover, set of challenges. management can help the team get the Teams That Recommend Things. necessary cooperation by opening doors These teams include task forces; proj- and dealing with political obstacles. ect groups; and audit, quaiity, or safety Missing the handoff is almost always groups asked to study and solve partic- the problem that stymies teams that recular problems. Teams that recommend ommend things. To avoid this, the transthings almost always have predeter- fer of responsibility for recommendamined completion dates. Two critical tions to those who must implement issues are unique to such teams: getting them demands top management's time off to a fast and constructive start and and attention. The more top managers dealing with the ultimate handoff assume that recommendations wiir'just
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THE HIGH-PERFORMANCE ORGANIZATION management is how to build the necessary systems and process supports without falling into the trap of appearing to promote teams for their own sake. The imperative here, returning to our earlier discussion ofthe basic discipline of teams, is a relentless focus on performance. If management fails to pay persistent attention to the link between teams and performance, the organization becomes convinced that "this year, we are doing 'teams'."Top management can help by instituting processes like pay schemes and training for teams responsive to their real time needs, but more than anything else, top management must make clear and compelling demands on the teams themselves and then pay constant attention to their mance challenge at hand or whether the group must deliver substantial incremental performance requiring real joint work products. Although the team option promises greater performance, it also brings more risk, and managers must be brutally honest in assessing the trade-offs. Members may have to overcome a natural reluctance to trust their fate to others. The price of faking the team approach is high: At best, members get diverted from their individual goals, costs outweigh benefits, and people resent the imposition on their time and priorities. At worst, serious animosities develop that undercut even the potential personal bests ofthe working-group approach.
happen," the less likely it is that they will. The more involvement task force members have in implementing their recommendations, the more likely they are to get implemented. To the extent that people outside the task force will have to carry the ball, it is critical to involve them in the process early and often, certainly well before recommendations are finalized. Such involvement may take many forms, including participating in interviews, helping with analyses, contributing and critiquing ideas, and conducting experiments and trials. At a minimum, anyone responsible for implementation should receive a briefing on the task force's purpose, approach, and objectives at the beginning of the effort as well as regul...