Chapter Nine
Using Teams in
Organizations
Chapter Objectives
• Differentiate teams from groups.
• Discuss the benefits and costs of teams
in organizations.
• Describe various types of teams.
• Explain how organizations implement
the use of teams.
• Discuss other essential team issues.
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Team
• Team
– A small number of people with complementary
skills who are committed to:
• a common purpose
• common performance goals
• an approach for which they hold themselves mutually
accountable
• Having a common purpose and
shared performance goals sets
the tone and direction of a team.
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Differentiating Teams and Groups
• Groups vs. Teams
– Group – refers to an assemblage of people or objects
gathered together
– Team – refers to people or animals organized to work
together; places more emphasis on concerted action
than a group
• Work group – the collection of people who happen
to report to the same supervisor or manager
– members may be satisfying their own needs in the
group and have little concern for a common objective.
– This is where a team and a group differ because in a
team, all members are committed to a common goal.
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Table 9.1: Differences Between Teams and
Traditional Work Groups
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Differentiating Between Teams and Groups
• Job Categories
– The work of conventional groups is usually
described in terms of highly specialized jobs that
require minimal training and moderate effort.
– In teams, members have many different skills that
fit into one or two broad job categories.
• Authority
– In conventional work groups the supervisor
directly controls workers’ daily activities.
– In teams, members discuss what activities need to
be done and determine who has the necessary
skills and who will do each task.
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Differentiating Between Teams and Groups
(continued)
• Reward Systems
– The traditional reward and compensation systems
suitable for individual motivation are not
appropriate in a team-based organization.
• In a conventional setting, employees are usually
rewarded on the basis of their individual performance,
seniority, or job classification.
• In a team-based situation, team members are rewarded
for mastering a range of skills needed to meet team
performance goals, and rewards are sometimes based
on team performance.
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Team-Oriented Reward Systems
• Skill-Based Pay
– Requires team members to acquire a set of the core
skills needed for their particular team plus additional
special skills, depending on career tracks or team
needs
– Employees can increase their base pay by acquiring
special skills
• Gain-Sharing Systems
– Rewards all team members from all teams based on
the performance of the organization, division, or plant
– Requires a baseline performance that team members
must exceed to receive some share of the gain over
the baseline measure
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Team-Oriented Reward Systems (continued)
• Team Based Plans
– Similar to gain-sharing plans except that
the unit of performance and pay is the
team rather than a plant, a division, or the
entire organization
– For the plan to be effective, each team
must have specific performance targets or
baseline measures that it considers
realistic.
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9-9
Benefits of Teams in Organizations
• Enhanced Performance
– May take many forms, including improved
productivity, quality, and customer service.
• Such enhancements result from pooling individual efforts
in new ways and continuously striving to improve for the
benefit of the team.
• Employee Benefits:
– Teams can provide the sense of self-control,
human dignity, identification with work, and sense
of self-worth and self-fulfillment for which current
workers seem to strive.
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Benefits of Teams in Organizations
(continued)
• Reduced Costs
– As empowered teams reduce scrap, make fewer
errors, file fewer worker compensation claims, and
reduce absenteeism and turnover, resulting in
significant cost reductions.
• Organizational Enhancements
– Other improvements in organizations that result
from moving from a hierarchically based, directive
culture to a team-based culture include increased
innovation, creativity, and flexibility.
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Table 9.2:
Benefits of
Teams in
Organizations
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Costs of Teams in Organizations
• Costs of Teams
– The costs of teams are usually expressed in terms
of the difficulty of changing to a team-based
organization.
– The primary costs include:
• Perception by traditional groups that their roles are
threatened
• Slowness of the process of full team development
• Premature abandonment of the change to a team-base
organization
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Types of Teams
• Quality Circles
– Small groups of employees from the same work
area who regularly meet to discuss and
recommend solutions to workplace problems
• Work Teams
– All the people working in an area, are relatively
permanent, and do the daily work, making
decisions regarding how the team's work is done
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Types of Teams (continued)
• Problem-Solving Teams
– Temporary teams established to attack
specific problems in the workplace
• Management Teams
– Consist of managers from various areas
that coordinate work teams
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Types of Teams (continued)
• Product Development Teams
– Combinations of work teams and problem-solving
teams that create new designs for products or
services that will satisfy customer needs
• Work Teams
– Work together via computer and other electronic
communication utilities; members move in and out
of meetings and the team itself as the situation
dictates
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Implementing Teams in Organizations
• Planning the Change
– The change to a team-based organization requires
a great deal of analysis and planning before it is
implemented.
• Making the Decision
– Prior to making the decision, top management
needs to:
•
•
•
•
establish the leadership for the change
develop a steering committee
conduct a feasibility study
make the go/no-go decision
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Implementing Teams in Organizations
(continued)
• Preparing for implementation consists of
the following five steps:
1. Clarifying the mission
2. Selecting the site for the first work teams
3. Preparing the design team
4. Planning the transfer of authority
5. Drafting the preliminary plan
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Implementing Teams in Organizations
(continued)
• Phases of Implementation
– Phase 1: Start Up
• Team members are selected and prepared to work in
teams.
– Phase 2: Reality and Unrest
• Team members are confused about and frustrated with
the new situation.
• For employees, unfamiliar tasks, more responsibility, and
worry about job security replace hope for the
opportunities presented by the new approach.
– Phase 3: Leader-Centered Teams
• Team develops an identity and focuses on a single
member as the team leader.
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Implementing Teams in Organizations
(continued)
• Phases of Implementation (continued)
– Phase 4: Tightly Focused Teams
• Team has confidence in itself, is solving problems, and is
resolving internal conflicts.
• Communication with external team begins to diminish,
the team covers up for underperforming members, and
inter-team rivalries can turn sour, leading to unhealthy
competition.
– Phase 5: Self-Managed Teams
• Phase 5 is the end result of the months or years of
planning and implementation.
• Mature teams are meeting or exceeding their
performance goals.
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Figure 9.1:
Phases of Team
Implementation
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Team Performance
• Team Performance
– Organizations typically expect too much
too soon when they implement teams.
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Figure 9.2: Performance and Implementation
of Teams
Reference: From The Wisdom of Teams: Creating the High Performance Organization by Jon R. Katzenbach and
Douglas K Smith. Boston, MA 1993, p. 84. Copyright 1993 McKinley &Company, Inc. All rights reserved.
Reprinted by permission of Harvard Business School Publishing.
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Start at the Top
• Change starts at the top in every successful team
implementation.
• Top management has three important roles to
play:
1. Top management must decide to go to a team-based
organization for sound, business performance-related
reasons; a major cultural change cannot be made
simply because it is the fad.
2. Top management is instrumental in communicating to
the rest of the organization the reasons for the
change.
3. Top management must support the changed effort
during difficult times.
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