50%
Increase in
Productivity
in
THE CASE FOR
SELF-MANAGED TEAMS
50%
Decrease in
Costs
BY TONY VICKERS-WILLIS
Self-managed teams (SMT) are small groups of employees who themselves take on much
of the supervisory responsibilities for planning and scheduling their work, assigning their
tasks, measuring their own performance, problem solving and sometimes even doing
their own hiring. Supervisory positions decrease in importance and may be eliminated
altogether. The result is not anarchy - SMTs continue to work towards overall corporate
mission with performance targets, and continue to receive corporate support. In Australia,
SMT is akin to removing the State-level of government, retaining government at both
Federal and Local levels.
The published research on the benefits of self-managed teams at manufacturing firms like
Oticon, Volvo, GE, Xerox, GM, PepsiCo, Honeywell, Mars, SAAB, Gaines Pet Food,
Texas Instruments, Alcoa and service firms like Aetna Life, Aid Association for
Lutherans (financial services) and the ATO is favourably overwhelming. In general, the
quality of work life and employee satisfaction (positive attitudes) is considerably higher,
with consistent reports of 50% increases in production and 50% reduction in costs.
SMT creates:
Annual Productivity Improvements



Quantity
Quality
Innovations
Reduction in Overheads





Need fewer managers
Need fewer non-managers
Reduced industrial conflict
Improved safety
Reduced escape behaviours:
o Less unplanned absences
o Less unwanted terminations
SMT produces better outcomes than many other organisational development
interventions, including job enrichment. However, its implementation must be
supported systemically, including change to some company policies and procedures
(e.g. ensure rewards support team behaviours) and leadership behaviours.
Note of caution - SMT will not be effective in all situations and is unlikely to succeed
when combined with downsizing.