Look at the figure below. It is an excerpt of a paper that measured the performance of effective teams vs. individuals in several tasks.
Team performance vs. individual performance in different tasks
Source: Reinero et al. (2021)
It shows that for most tasks, teams performed significantly better than individuals. The only exception was a typing exercise where individuals performed better because teams constantly had to look up where other team members were and wait for slower typers which slowed down the whole team. Teams don’t always perform better but for creative and complex tasks that aren’t well defined, they almost invariably produce better results.
And because our modern knowledge economy is mostly dealing with tasks that require creative solutions to difficult, ever-changing problems, businesses are constantly putting more emphasis on their employees’ ability to work in teams.
But how do you form an effective team? I have discussed previously that having star players in a team or individuals who are much better than everybody else doesn’t work. In fact, it may be counterproductive to the team’s performance. In Germany, there is a popular book called ‘Die Teamlüge’ (‘The team lie’ in English) which compiled lots of empirical evidence when teams are worse than individuals.
Teamwork isn’t a panacea, but if you can form effective teams, there is strong evidence that it improves outcomes in most complex tasks of today’s business environment. But how do you form an effective team? How did the researchers in the study above form the teams in their experiments?
It is instructive to note that the participants in these experiments were incentivised differently. In the individualistic setting, participants were told that their performance is measured based on their individual contributions and that they were competing for a bonus pool against other individual participants. Hence, participants were incentivised individually and correspondingly behaved in an individualistic manner without much identification as a member of a team, though notionally, they were part of a team of workers trying to solve problems. If that sounds like your current work environment and the performance measurement system at your company, it’s no accident. The vast majority of businesses claim they are team-oriented, but then run incentive schemes that are based on the measurement of individual contributions. Every employer I ever had claimed that the bonus pool at the end of the year was not just defined by my own performance but also the performance of my team, and my division, but while personal performance indicators were clearly defined and measured monthly, the team performance and its weight in the overall bonus pool were never disclosed and never properly defined. But if you don’t know what the team’s performance is and how it can be influenced, you are not going to change your behaviour. What gets measured gets done, but unfortunately, almost all companies only measure individual performance.
To make up for the shortfall, companies then create team events and make employees participate in team-building exercises, which in my view are a waste of time and money because they have no permanent impact on the behaviour of individuals the moment they go back to a workplace and are confronted with individual targets.
Now compare this individual incentive scheme to the team incentive scheme where people were asked to name their team and the team was incentivised as a team with the bonus split up between different teams based on the team performance. Within each team, the team bonus was then split up evenly between all participants. Hence, it wasn’t about competing with other individuals in your team and outside your team. There was nothing to gain for an individual by outperforming other team members. On the other hand, there was also nothing to lose by underperforming and slacking off except that a team member who didn’t pull his or her own weight would drag the whole team down and face the social pressure from the other team members. And if you truly feel like a member of a team, then that peer pressure is enough to make you feel guilty and perform to the best of your abilities.
As a matter of fact, there is a way to measure if team members truly feel part of a team (though one that is not practical in a business setting): Effective teams show increasing coherence of their brainwaves. Measured by EEG, members of a team who strongly identified with the team showed increasing synchronisation of their brain activities. They were literally getting on the same wavelength.
And how do you do that? I doubt that a team incentive structure on its own will do the trick. But complement it with daily rituals that foster team building and you might get there. We know from effective sports teams that synchronised physical activities can be powerful tools to foster team spirit. Whether it is exercising together, dancing, or singing together, all of these activities have been shown to foster a feeling of belonging with fellow participants. Getting into a huddle where you literally stick your heads together with your teammates and turn your back to everyone else is another technique to increase team cohesion. And having a team name, a team symbol, etc. all help as well.
Business has a lot to learn from sports teams in my view when it comes to building successful teams. And when it comes to building a team identity through songs, logos, etc. nobody does it better than Liverpool FC. Love them or hate them but watch the video below and you will realise what a powerful force of identification a song like “You Never Walk Alone” is. Also, check out all the different team building activities the players perform during one of the most legendary comebacks in football ever.
This is so true. I do not know anything about Liverpool FC but I stayed put in my very first job (software development) for 8 years because our management was consistent in promoting the idea of a team. My boss talked the talk but also walked the walk.
For example, when we were shipping out and there were a lot of defects (bugs), a "Quality Control Bonus Fund" was set aside. All expenses related to fixing a defect, including travel. lodging, and any other expense to appease the customer or re-release the software was taken from this fund.
At the end of the year, whatever remained in the fund is our year-end bonus, to be divided among all the employees. To foster helpfulness, although each one is allocated the same share (new hirees get a pro-rata for the year), we were allowed to award a certain fraction of our bonus share to any colleague if we think he/she deserves it. Most often, awards would go to people who go out of their way to help you hunt the debugging logs for clues, or even create/offer a tool or technique, so the problem can be diagnosed faster and fixed sooner.
On modest years we have not a lot left, we spent the bonus fund to go on team activities like a beach trip on a weekend or some adventure. The first time we had a relatively clean release and saw how much we saved and thus, how much we will each get, the improvement was radical. e.g., I would be in the office on a Saturday afternoon to rewrite code or begin documentation (technical debts, you know) but "I will not code alone". Everyone started to think like an owner and as long as the goal and situation is communicated clearly, there was no quibbling about extra hours or problems about doing grunt work.
To date, I have not seen yet better proof that the brain (and employee psyche) is malleable after that. The company got sold so eventually we took different paths. The team spirit? Many years later, the majority of the employees still have some annual reunion (in groups around the globe) and we keep in touch to celebrate Christmas or just to eat all the cakes and ice cream in a dessert place (yes, I once flew to Houston to do that).
Nice (hate to admit that Liverpool FC is the best at it but combined with their wins it's likely true). Other that I find remarkable Dortmund /st Pauli/ Olympique Marseille, Napoli.... Id actually argue it goes beyond teamwork in football since it's a whole culture indoctrination that goes on at those clubs.