Too many companies, weighed down by hidebound 20th Century structures, are ignoring the power of teams. Here we explain how to build the kind of team that is crucial to 21st Century performance.

A paradox of the digital age is that, to be successful, leaders need to show better relationship skills than ever before. Few have picked up on this fact, but, those that have are generating innovation, growth and productivity beyond the norm.

No surprise that many of these leaders are involved with start-ups, and so have had the luxury of starting from scratch. No-one doubts the difficulties of organising from first principles, butbI reckon these companies are fortunate and should be the envy of their larger, historically-successful peers. With a clean slate at their disposal, they don’t have to battle long-held organising structures that were built for the 20th Century.

The fact is that 21st Century businesses look, feel, and organise differently because the nature of work is different.1 And legacy businesses, built on old principles, must learn a new way of operating to survive. To their credit, many are evolving on-the-go and experimenting with new structures and methods – deploying ‘agile’ operating processes of the sort used by tech start-ups is now common. Sadly, few are successful. Why? Because whilst it may be easy to copy a process, it’s much harder to change mindsets so that they operate effectively within that new structure.

A PARADOX FOR THE DIGITAL AGE IS THAT LEADERS NEED TO EXHIBIT EVEN MORE INTERPERSONAL SKILL IN A HIGH-TECH WORLD

  1. Businesses are evolving on the go, experimenting with new structures and methods to adapt to the environment and shape the future.
  2. Teams and organisations are adopting flatter structures with the promise of creating more agility.
  3. These efforts are failing for many mature businesses who adopt new structures but persist with traditional hierarchical mindsets and outdated practices.
  4. The principles and behaviours that promote agility more closely resemble networks and focus on increasing the quantity and quality of teammates contributions.

MAKING TEAMS COUNT

To increase the chances of success, businesses need to first change the way they build teams – and then ensure those teams operate, and are led, differently. In recent years, there has been a shift away from siloed, specialised work, towards more cross-functional teamwork – and these new teams tend to form partnerships outside the business as much as they do within it. Take, for example, the European pharma AstraZeneca’s ‘Open Innovation’ strategy:

“At AstraZeneca we pride ourselves on being one of the most porous and open collaborators in our industry. We are passionate about working openly with the best scientists around the world to understand key pathways and mechanisms that can help transform great science into great medicines.2”

Most established companies aren’t accustomed to working like this. They’re not designed as a series of collaborative, flat teams which rely on diversity of perspective, and engagement across the whole team, and an equal contribution from everyone. The modern team-based company, by contrast, is built with the specific intention of operating like a network of its members and all their complementary skills and experiences.

ANATOMY OF THE MODERN TEAM

Here are a few guiding principles on which to build modern teams:

  1. Teams must be built for change: Whether facilitating growth or responding effectively to external pressure, teams need to form with the potential to drive change. This means they need to be diverse in meaningful ways: i.e. they need to bring various skills and experiences to solve new, unscripted problems.
  2. Teams need inclusive leadership: The main function of team leadership in the 21st Century is to create the conditions for collaboration in service of a common purpose. Research from Harvard, reinforced by an independent Google study, has found that ‘team psychological safety’ may be the most important condition that leaders can create.
  3. Teams need to create healthy habits for connecting and collaborating: Firstly, teams need high engagement – the habit of working with everyone on the team. If you notice pairs, triads or splits in your team, you haven’t got this right. Secondly, they only thrive when there is maximum contribution from everyone. When a few people monopolise team discussions, you will need to develop processes to spread the contribution or get the voices of the non-contributors in the room. Finally, although you need more positive than negative exchanges on the team, the absence of conflict is just as bad as having full-on conflict. Strive for a 3:1 ratio of positive to negative exchanges on the team.

Our work in this area is fresh, and our point of view continually evolving as we partner with companies to address the challenges associated with constant, intense change. Too many businesses continue to build teams by hiring the best individual for a specific role instead of focusing on the team as the unit of performance. Unfortunately, those teams are set up for failure and will struggle to adapt to the new business context. To ensure you are not in that group, start building and leading your team differently. Create a shared purpose, establish clear roles, and build a climate that promotes collaboration, smart risk taking, and equal contribution; these are the building blocks of Change-Ready Teams.

CHANGE LEADERSHIP ORIENTATIONS

REFERENCES

1Karen E May, Work in the 21st Century: Implications for Selection. Society for Industrial-Organizational Psychology (http://www.siop.org/tip/backissues/tipdec95/may.aspx).
2Mene Pangalos EVP, IMED Biotech Unit, AstraZeneca. Astra Zeneca corporate website, July 18, 2017 (https://openinnovation.astrazeneca.com/about-us.html).