Building a Team

You can’t work today without hearing the term “teamwork.” It’s one of the biggest buzzwords and most-enduring trends in business.

That shouldn’t be surprising. The idea of teamwork is ingrained in most of us from childhood. From Little League to the pros, teams are part of our daily lives and conversations. Even those uninterested in sports can’t escape team-related analogies, anecdotes, or advice. Tell someone to “be a team player” or “get with the team” and he or she will at least have a basic understanding of what you mean.

That familiarity doesn’t mean it’s easy to get your employees and coworkers involved in the workplace. Pep rallies might enhance team spirit in high school, but it takes more than feel-good measures to get everyone reading from the same playbook on the job.

What it takes, experts say, is a combination of employee empowerment, management commitment, clear and continuing communication, obtainable goals, and carefully structured rewards.

Time for a Change

In the 1990s, many business owners have learned that rapid change, greater business complexity, and increased competition—especially on a global scale—have made the conventional top-down, command-and-control style of management obsolete. Such an approach can’t support the quality improvements, productivity gains, and responsiveness to market demands that are necessary to compete in the new business climate.

It’s time for companies to “change or die,” says corporate teamwork consultant Ron Archer in his 1996 book On Teams. Companies that are committed to survival must look to strategies that can improve production and quality, he says, noting, “Wherever quality is a buzzword, teams are sure to follow.” 

With the emphasis on teams now well into its second decade, numerous studies document that successful employee involvement can help a company outperform traditional workplaces.

For instance, nearly 70 percent of large employers and roughly 60 percent of small employers have adopted some sort of employee involvement measures, reports the Employment Policy Foundation, a Washington, D.C.-based organization that tracks workplace trends. Typical productivity gains from such employee involvement range from 18 to 25 percent, with those that include an incentive reward system improving 50 percent or more. Other evidence indicates that some companies can see productivity skyrocket 100 percent.

“Workplace teambuilding benefits companies in a number of ways,” notes Don Dewar, a consultant with QCI International (Cottonwood, Calif.). “Teambuilding enhances quality, productivity, and employee motivation. As a result, companies that implement and manage teams experience an average savings-to-cost ratio of 6:1.”

What is it about teampower that creates such dramatic gains? 

“When companies start implementing teams and are committed to the teambuilding process, workers start to feel that management is listening to them,” Dewar says. “They start to believe for the first time that they have a stake in what happens with the company, and as those feelings develop, employee motivation goes up.”

Higher employee motivation translates into lower turnover and absenteeism rates, opportunities for leadership development, and enhanced safety awareness as employees become more aware of problem prevention. The sum is increased production.

Winning With Team Players

Consider Carolinas Recycling Group L.L.C. (Spartanburg, S.C.), a ferrous and nonferrous processor created in December 1998 by the merger of Industrial Metal Processing Inc. and Spartan Iron & Metal Corp. When a group of four investors purchased the Industrial Metal portion six years ago, the company was plagued by excessive turnover, uneven production, and inconsistent quality. Employees expected annual raises for performing at the minimum level.

At the time of the purchase, the investors decided to transform the company’s traditional production line into self-directed work teams. As a result, Carolinas Recycling ended 1998 in the black, turning its inventory 18 times during the year. Moreover, the firm is approaching four years without a lost-time accident, and employee turnover is at 11 percent.

The transformation is a direct result of the decision to implement workplace teams, says Ted Davis, one of the initial investors who now runs operations. “Everyone is a team player, and the company is the winner.”

Carolinas Recycling combines a commitment to communication with employee empowerment so that employees know their goals and can decide how to get there.

“We try to push decision-making down as low as possible,” says Davis. The firm’s operations are structured to allow each employee team to decide how it will reach its production goals for the week, month, and year, he notes.

Overall production goals are established at the beginning of the year and communicated to all employees. Monthly, middle managers meet with Davis to determine the amount and sources of material required for the month. All this information is disseminated companywide through meetings and computerized reports that are available to all employees. In weekly production meetings, teams discuss their week-to-week goals and performance.

“Each work team knows how many tons it needs to get out each day to make its goal for the week, and each knows what the goals are for the month,” says Davis. “Beyond that, each team has tremendous leeway in deciding how to get the job done.” For example, the picking line team decides at what speed to operate the belt and when to start and stop the line based on the amount of throughput it needs to achieve each day.

“Empowering employees by communicating goals and giving them the authority to make decisions that directly impact their work relieves management of having to decide every detail of every day,” says Davis. “It truly lets employees take ownership of what they do.”

Success in Texas

At paper recycler Texas Recycling/Surplus Inc. (Dallas), “a team approach has kept our turnover low and built pride among the work force that has increased production and quality,” says Joel Litman, who jointly runs the company with his father Stan and brother Craig.

The 25 employees at the firm’s 30,000-square-foot plant are organized into work teams of three to four employees. Each team is responsible for a certain operation, but everyone is cross-trained and is expected to switch jobs as needed.

“People who can’t work under those conditions choose not to join the company,” says Litman. “Those who do, tend to stay.” Texas Recycling is seven years old, and its work force includes many employees who have been with the company from five to seven years.

With a totally Hispanic work force, the Litmans work hard to overcome language differences that could pose a barrier to effective teamwork. They’ve even taken Spanish courses at the local college, though they still often rely on bilingual employees to make sure that goals and projects are communicated clearly.

One of the most important factors in Texas Recycling/Surplus’s success is that its employees feel they’re rewarded for their efforts, says Litman. Monthly bonuses are based on merit, production, and performance, and expectations are communicated clearly to employees. “How much we produce is what matters, and they understand that to meet the goals, everyone has to work together,” says Litman.

Getting the Right Game Plan

Building an environment of trust, cooperation, and effectiveness takes work and time, says Pat Galagan, editor of Training & Development, the journal of the American Society for Training and Development (Alexandria, Va.). As Texas Recycling/Surplus demonstrates, setting obtainable goals that are communicated to employees is a key element in building effective teams.

"A team must have a purpose that’s understood by everyone on the team, and each team member must understand his role in reaching that goal,” Galagan says. “The team must have a game plan for accomplishing results, and everyone on the team must be accountable.”

Comprehensive, ongoing communications that keep everyone focused on the goals are critical in building effective teams, she adds. “The importance of communicating information about the company’s goals, business data, and profit and loss can’t be overemphasized.”

In a true self-directed team environment, employees have decision-making power and control over their own work. Rewards and compensation are structured to support teamwork. Carolinas Recycling, for instance, tightly links rewards and compensation with production. Each month’s goal reflects combined production from all of its seven locations. Employees receive a 30-percent bonus each month that goal is met.

Setting up the bonus plan this way supports teamwork across the company as well as within each plant, Davis explains. “For example, when one plant’s shredder is down, the shredder team at another location is willing to work extra to compensate because the members know that their bonus is riding on total production,” he says. “Next month, it may be their turn to need help.”

Creating a Team Environment

Ferrous and nonferrous scrap processor Schupan & Sons Inc. (Kalamazoo, Mich.) uses self-directed work teams organized around equipment, with sub-teams devoted to each production function, such as baler operations and baler maintenance. “It’s up to the groups to work together to maintain production, plan maintenance, or handle problems within their area,” says Marc Schupan, president and CEO.

He credits his three years as a high school coach for impressing on him the importance of teamwork. Applying teamwork principles at his company and observing the results has convinced him that teams can function in the workplace as effectively as they do on the sports field.

“We try very hard to encourage team spirit companywide as well as among individual work groups,” he says. “We believe that it increases production and reduces turnover and absenteeism.”

He points to Schupan & Sons’ continuing status as a nonunion shop as proof of high employee morale and satisfaction generated by the company’s commitment to teambuilding.

Regular work teams are supplemented with cross-functional teams for special projects as needed, such as the ISO 9002 certification the company hopes to complete in May 1999. The firm also pulls together ad hoc teams to tackle production problems through informal brainstorming and discussion.

“Over the years, we’ve found that getting employees to buy in on projects and goals is easier when they feel they’re part of the team,” says Judy Woolsey, administrative assistant to Schupan. 

The Schupans continually work to convey the message that the company values it employees. When an employee’s son had a broken arm this winter, for example, the family sent him a toy store gift certificate. A company picnic and holiday party, T-shirts, and remembrances on anniversaries and at times of bereavement are simple gestures that go a long way toward building team spirit and loyalty, Woolsey adds.

“These are the gestures that make people feel they count on a personal as well as a business level and make them willing to go the extra mile when asked,” she says. 

Promoting Self-Reliance

Annaco Inc. (Akron, Ohio), a ferrous and nonferrous processor, has found a similar formula for success, organizing its scrap processing line into production teams of three to four employees. “It’s an informal structure, but in almost every job, success depends on shared projects and interactions,” says Bob Toth, human resources manager.

“Each work group is responsible for accomplishing what has to happen,” he says. “Within each team, employees find their own niche and work together to accomplish production goals. Where each person fits is determined by the team, based on each individual’s skills.”

Teams are encouraged to be self-reliant and make decisions, a process that helps supervisors work more effectively and efficiently by allowing them to give their attention to matters that truly require it, says Toth.

“Supervisors can’t be everywhere at once, calling all the shots every time,” he says. “With a team approach, they don’t have to be because the team members are in on the information, know what the customer needs, and know what they have to do to make that happen.” Supervisors at Annaco encourage teams to operate independently and take responsibility for their decisions.

Annaco’s philosophy and structure are modeled on lessons learned from Swedish carmaker Volvo, says Toth. “Volvo was one of the first companies to let employees have control over their work environment and to prove that, if given the opportunity and support, people can self-manage their work and achieve corporate goals,” he says. “Those are the principles we’re trying to apply.”

Making It Happen

Making the decision to unleash teampower is a serious decision for a company, say teambuilding experts. Moving from a traditional top-down management style to the flatter, broader team environment requires investments of time, effort, and resources as well as the commitment to see it through.

One way to get a running start on the process is to hire a consultant to conduct on-site training for managers and team leaders. Companies that choose this route can expect to spend as much as $10,000 for five days of training. This approach creates essentially a turnkey team operation and reduces the learning curve by helping the company avoid the most common pitfalls.

Still, many companies—like Carolinas Recycling and Annaco—prefer to do their own research by studying successful companies and implementing changes on their own. It’s hard to say whether this approach is less expensive, but it has the advantage of enhancing commitment to the program through more direct involvement by company officers, and it may be perceived by employees as less threatening. It also allows the company to draw on the best ideas from a number of different sources and create a very customized plan.

Selling employees on the concept is critical, says Davis of Carolinas Recycling. He vividly recalls the initial meetings with employees to discuss his firm’s team-focused structure.

“We started with having to overcome the ‘this is my job, that’s his job’ mentality and explain that no longer applied,” he says. “Moving on from there, we had to explain that the company couldn’t give raises without seeing an increase in production, that there would be specific goals to be reached, and that compensation would be tied to reaching goals.” Linking a discussion of teams to production and quality usually is the wisest approach, says QCI International’s Dewar. Forget any notion of teambuilding based on activities solely designed to make people feel good, he says. Effective teambuilding will enhance employees’ self-respect, dignity, and satisfaction in the workplace, but the focus has to be in real-life terms that they can relate to.

“Start talking to your toughest, hardest-bitten supervisors about self-actualization through teambuilding, and you’ll be greeted with skepticism,” Dewar says. “You have to talk production because that’s what they understand.”

Be prepared to provide regular reports to employees on cost savings and production and quality gains, he advises. This means that your company must have well-developed information systems that can create the reports needed for planning and evaluation.

Clearly, the decision to develop workplace teams affects every area of a company and isn’t one to be taken lightly, say teambuilding experts. “It isn’t for the fainthearted,” says Davis, “but the rewards are tremendous.” •