Work, business & professional services

Under-performing teams

Over the past 30-40 years the idea of using teams has become so ingrained in our culture as to be almost invisible. Nobody in their right mind, it seems, would dare to challenge the thought that working as an individual could ever as productive or efficient as working as part of a team. But is this really the case? According to J. Richard Hackman, a Professor of organisational psychology at Harvard University, the answer is that it depends.

The first reason that teams can under perform is that they are typically too large and suffer from what Hackman calls “ambiguous boundaries”. For example, in one study less than 10% of team members were able to agree upon who was actually on their team. Excessive size causes problems with co-ordination and also with motivation. Why do some teams get so big? One reason is that the desire to be inclusive often means that people are put on teams purely to avoid confrontation. The ideal size for a team, according to Hackman, is “in single figures” but teams of 20-30 plus are commonplace. As for networks and online teamwork the same rules generally apply. Virtual teams can be difficult to co-ordinate and suffer from what Jo Freeman calls “the tyranny of structurelessness”. A lack of physical contact, especially at the all important first meeting, can also cause major problems.

A second reason why teams often under-perform is that they are changed too frequently. Great teams can be decades in the making. But how do you stop long-lasting teams from becoming flaccid or complacent? One answer might be to very slowly rotate individual members, but a much better way is to introduce deviant thinkers from time to time. This notion is similar to the idea of having a “thinker in residence”, someone who is willing to say or do things that other people are not. A third and final issue is resources. There is a widespread belief that large teams will have access to greater resources, but the reverse is often the case. Large teams soak up time as well as money and it is precisely the lack of such resources that can create the sense of urgency and focus that are so critical to success.

Open plan offices don’t work

If there’s one thing that symbolises the creative industries it is probably an informally attired worker in an informal, open plan office. But a study by Dr Vinesh Oommen, at the Queensland University of Technology, (published in the Asia Pacific Journal of Health Management) claims that the use of open plan offices is adversely affecting productivity. Moreover, open plan offices are linked to decreasing levels of privacy, increasing levels of job dissatisfaction and rising levels of workplace conflict. And if that’s not enough, open architecture and office floor plans can also lead to higher blood pressure and the spread of infectious diseases. In other words, the open plan office is just about the worst possible environment that you can work in. Admittedly, open plan environments improve communication and are friendlier to work in but these are just about the only advantages.

But what’s behind the open plan idea and is it possible that people will ever go back to the idea of private offices? The reason for the rise of open plan is simple. Real estate costs have increased and there is tremendous pressure to cut costs. Hence, a sea of cubicles, or a raft of low-rise (low cost) work-stations, in a large open space makes economic sense. Crucially such spaces also shout “equality.” If everyone in an organization shares the same physical space (and has an equal amount of space) then they are equal, right? But this is clearly wrong. First, what’s so wrong about hierarchy and status in organizations? And second, creative businesses in particular demand creative thinking. This, in turn, requires concentration and this is best achieved in calm, quiet, private spaces. One way of dealing with a noisy environment is to save complex thinking tasks for times when an office is quietest (early mornings, late nights and not on Monday and Friday mornings when the chatter tends to be loudest). As to whether there will ever be a backlash, this is quite possible. As skills shortages bite, power will shift from the employer to the employee and there will be demands to improve working conditions. Indeed, we may even see the day when physical settings become as important as salary or the nature of the work itself.

An age of unreason

What’s going to happen to the world economy? The answer, of course, is that nobody knows. One possibility is hyperinflation, followed by a second great depression. Another is mass-employment or the collapse of globalisation. The latter might sound far-fetched but it happened before just before WW1. On the other hand, global growth could come storming back sooner than most people expect and we will collectively forget what’s just happened. Clearly, the range of possibilities is almost endless, partly because the number of individual elements involved is so high. What is certain is that there is an awful lot of guesswork going on at the moment. Nobody is quite sure what will work, so people are trying almost everything. Having said this, one strategy that is being tried by almost everyone is spending, or, more precisely, borrowing even more money. Will this work? Who knows? There is an implicit threat of inflation, although given that inflation would downplay the level of government and household debt this could be a good thing in moderation. One would certainly expect regulation to increase and taxation also. However, the really big question is perhaps not what will happen but rather whether or not we have learned anything. Borrowing and spending (especially in the US) and separating risk from reward largely got the world into this mess so blindly stimulating the economy and expecting things to change in the future seems somewhat delusional. As the philosopher Herbert Spencer once remarked: “the ultimate result of shielding man from the effects of folly is to people the world with fools.”

Business networks (old versus new)

US-based Linked-in is a social networking website with 42 million members in 200 countries, which allows individuals to keep in touch with existing contacts and track potential business leads. Xing and Viadeo are similar sites based in Germany and France respectively. In theory these sites are the future of business networking. They are open, efficient and highly convenient. They also cross borders at the click of a mouse and are largely free to use. But just how effective are these high-tech global communities compared to the old-fashioned, physical clubs and alumni networks?

To e-vangelical members of Generation Y the answer is a no-brainer. Sites like Linked-in are a convenient way of keeping in touch. They facilitate quick introductions and allow for the easy exchange of information. This is true but perhaps some of these online networks are becoming too large and people are becoming too available. The sheer size of these networks means that ties tend to be weak. This means that trust is not strong, which means that any information that is created or exchanged tends to be shallow or superficial. Equally, if scarcity creates value then the smaller, older-style, physical networks could be more profitable. So what’s next? The answer is probably that both will survive. Online networking sites will aggregate otherwise dispersed skills and will allow for the creation and maintenance of weak contacts. But they will, ironically, also ensure that the older and more exclusive physical networks will survive and grow even stronger because they will facilitate further connectedness.

Rendezvous with austerity?

To succeed, any organization needs to stay on top of current trends but also keep an eye on emerging trends. An article by David Pearce Snyder, in The Futurist magazine, neatly summarises ten such trends. Here’s a summary of a few (not all) of the trends along with some additional commentary.

The first trend is that the internationalisation of domestic economies is leading to a deep inequality of wealth in some regions. While productivity has risen, the beneficiaries of this tend to be small domestic elites. For example, in the US productivity growth has increased over the last 10 years but median personal incomes have fallen. The second trend is that despite falling household incomes, personal consumption has gone up, fuelled largely by the availability of cheap credit. However, access to low-cost credit has now largely come to an end (the third trend) and debt has increased globally.

Next up is increasing regulation, especially within financial markets and next is infrastructure under-investment, especially in areas such as transport, education and health. Another trend is demographic change, most notably the ageing of most populations (leading to shortages of skilled workers and also looming pensions problems) while another emergent trend is rising inflation (especially food, water, energy and other raw materials). The final trend is increased infrastructure spending (a contradiction to trend #6 but not really because the expenditure is patchy), while the tenth trend is lower household spending.

So where does all this leave us? One possible scenario is austerity, especially within suburban areas that have historically been developed on the back of cheap energy, resources and credit. If people are earning less in real terms but spending more to get less this could be a recipe for real trouble. Watch how things turn out economically (ie, watch for higher taxation, rising inflation and a continued credit crunch) but if people feel that they are getting squeezed while others aren’t, trouble is quite likely to become political and spill out onto the streets. Early signals could include a rise in protectionist attitudes, an increase in racist incidents and the emergence of far-right politicians and political parties.