Editor's Note: This article first appeared in the MIT Sloan Management Review Blog.
An important executive goal in most large companies is to improve efficiency and effectiveness. With top-line revenue growth elusive in most markets, a key way to increase returns to shareholders is to boost the bottom line — and that means stepping up productivity. These gains need to come from improving the processes that run the company as well as those that change it.
Unfortunately, achieving greater productivity in project teams
focused on change can be challenging, especially when new technology
is involved. Every company has experienced a project that was either
delivered at twice the budget and in double the time, or never
actually delivered against its objectives and eventually scrapped.
There are many reasons why
these large programs fail, but one potential root cause is that
they simply break down under their own weight. One way to improve the
effectiveness of projects is to reduce the size of the teams mobilized
to tackle them. In other words, it might be time to make your project
Smaller teams move faster, iterate at a higher frequency, and innovate more for the company. There are endless examples of small teams achieving amazing things. When Facebook purchased WhatsApp for $19 billion, the company’s 32 engineers had created a platform that was used by 450 million users. The Volkswagen Golf GTI, one of the most famous hot hatchbacks in history, was created by a team of eight. Many of the largest technology companies created their first successful products with teams of fewer than 10 people.
Jeff Bezos famously instituted a “two-pizza rule” in the early days of Amazon. His edict was that any team that could not be fed by two pizzas was too big. In concept, it is fairly easy to understand how a smaller team can be more effective, as communication is easier and decision-making can be accomplished more quickly.
But practically, how can managers take advantage of this technique in large organizations?
Ten Ways Smaller, More Agile Teams Can Achieve Greater Productivity for the Organization
1. Make Big Problems Smaller Problems
Establishing two-pizza teams is especially challenging with in-flight programs in large organizations that tend to grow over time. If you track the scope of a major change initiative, you’ll often find that by the end of the project, the goals of the program bear little resemblance to those that were agreed on at the beginning. This growth effect is vastly multiplied as the size of the program and the team supporting it grows. New team members bring new goals that have to be incorporated into the program (and, of course, nothing is ever removed).
One way to control this natural program weight gain is to break down the project from the beginning into discrete problems that can be solved by smaller teams. With leadership focus, even large, complex problems can be compartmentalized into separate, achievable pieces that a small team can easily take on and over-deliver.
Another way to get smaller without actually shrinking your organization is to break business capabilities into focused organizational units, each with a clear mandate to provide the company with a discrete set of services that are well-defined and understood. Then put someone in charge and give them responsibility and authority to get things done — and see what they can accomplish.
Jeff Bezos famously instituted a “two-pizza rule” in the early days of Amazon. His edict was that any team that could not be fed by two pizzas was too big.
2. Ensure No Team Member Is Indispensable
One of the realities of many large organizations is that few people have the luxury of working only on a single problem. As problems and the teams that aim to solve them multiply, key people get split across many competing tasks, so their time is sliced into small, difficult-to-manage increments. When a critical member of a team is simultaneously working as a member of six other teams, delivery against critical milestones is inevitably affected. Just getting on that person’s calendar becomes difficult.
It is important to actively manage away from “indispensable” people in your change and transformation projects. Single-threading important decisions to any one person creates a single point of failure for the team. As a result, projects and innovations move at a slower pace and operate with higher risk. Small teams allow you to take steps more easily to cross-train as a way to manage this risk.
3. Adopt One-Step Decisions
Large teams are notorious for needing multiple steps to make most decisions. Aligning calendars often takes time, and once you get everyone into a room (or, more likely, on a call), several attendees need to be brought up to speed. Some attendees will not have read the requisite material, and others will have been sent as substitutes for key decision-makers who could not make the time (and these substitutes will not be able to make any critical decisions without conferring with their boss). We’ve all attended these sorts of meetings. They rarely result in decisions — and they usually lead to additional meetings. A small team can shortcut these issues much more easily. Fewer people need to be present to make decisions, and those present are typically much more involved in the details of the problem, so they don’t need a meeting to ramp up before they can contribute.
When you first form a team, spend time to determine what types of decisions each member of the team can make on their own, what types of decisions the team can make as a group, and what needs to be escalated for more senior input. Then fight hard to push as much of the decision-making to the team by defining very clear guidelines that give the team ownership and accountability.
4. Build Trust
There is nothing more powerful in a team than trust. It accelerates progress, improves quality, and reduces execution risk. Yet, trust doesn’t come automatically and often needs to be intentionally created. Smaller teams allow managers to spend more time with each person, getting to know their strengths, weaknesses, and career goals. They can structure tasks in a way that reinforces the natural strengths of the team, which allows team members to show their competence, and that builds trust. Team members also build trust through constant interactions as they tackle and solve problems together.
A successful team event outside of work doesn’t hurt either. Sometimes trust is built in the bowling alley, the paintball pitch, the basketball court, or just enjoying good food.
5. Be Less Formal When Sharing Information
Presentations are an amazing tool for communicating complex ideas. They are also a huge time sink for teams. By moving to smaller, more focused teams, you can reduce if not eliminate the need for the structured communication that a presentation provides.
A small, focused team can easily replace a formal presentation and slide deck that requires hours to create with a whiteboard session where the problem and solution are diagrammed out in real time. If the team is not colocated, there are many collaboration tools like Slack, Microsoft Teams, and Symphony that can replace a physical whiteboard and move the brainstorming online. The impact is the same: faster solutions and greater alignment across the team.
6. Increase Visibility (and Accountability)
It is fairly easy to hide in a large team. You can dial into conference calls and avoid contributing. Since deliverables are owned by multiple people, it is easy to let others do the heavy lifting. You can be busy during key meetings where you need to be prepared. We’ve all worked on teams in which no one really knew what some members were doing.
With small teams, hiding is nearly impossible. A lack of contribution is immediately noticed, and those who don’t contribute to moving the ball forward can be moved off the team much easier because there is direct evidence that they are not adding value.
7. Limit Unnecessary Synchronous Meetings
While it clearly isn’t possible to eliminate conference calls entirely, the ubiquitousness of collaboration platforms like Slack, instant messaging, and desktop videoconferencing means that teams can communicate in many ways that don’t revolve around conference calls with all of their inherent challenges.
Small teams can avoid conference calls because they communicate often, through multiple channels, both digital and face-to-face. Large teams don’t interact nearly as much and therefore need regular catch-ups to re-sync on objectives and ensure information is being shared effectively. Even then, conference calls are still relatively ineffective in ensuring alignment.
It is fairly easy to hide in a large team. With small teams, hiding is nearly impossible.
8. Focus Less on Tracking Project Progress
Project managers live to track things. They make lists of tasks and
track progress against them. They identify dependencies and track
relative slippage. An effective
project manager is able to act like oil for a large project
team, reducing friction just when it threatens to affect delivery.
Yet, less effective project managers spend their days bothering teams
for status updates and creating presentations aggregating the updates
With the widespread adoption of tools like Slack and Jira, the need for someone to play the role of progress aggregator is quickly coming to an end because the platforms automate tracking. This is even more pronounced with smaller teams, who communicate at such high bandwidth that everyone knows what tasks are behind and what needs to be done to get them back on track.
Product managers are critical, but the usefulness of project managers should be questioned, especially as teams get smaller and more focused.
9. Work More Easily With Other Teams
As you break down programs into chunks that smaller teams can
tackle, the interface between teams dependent on each other becomes
critical. It is often friction between teams that turns into missed
dependencies and timeline slippage.
It is important to craft “contracts” between teams that clearly outline their individual mandates, spell out how they will interact, and identify what they can rely on each other to provide and when. A focus on clear and concise dependency management increases transparency while ensuring that each team can focus on achieving the specific goals it has been assigned.
10. Embrace Technology Faster and More Effectively
Smaller, empowered business teams who have control of their own
destiny start to figure out how to leverage technology to improve the
world they now control more quickly — especially if you give them more
direct oversight of the technology teams that support them.
In order to accomplish this, companies need to figure out which aspects of their technology delivery capability need to be centralized and which aspects can be decentralized and moved closer to the teams who are executing for customers and colleagues. Improvements also need to be made in the process of evaluating and approving the use of innovative technologies, as this is often a point of friction in larger organizations.
The emergence of machine learning as a critical business tool is an example that shows how technology teams are working to put sophisticated analytics capability into the hands of small teams of business users. While difficult to accomplish, a properly balanced technology delivery capability that supports execution teams will result in increased innovation and acceleration in meeting business goals.
As technology gets more modular and flexible and as organizations adopt agile delivery techniques, the concepts outlined above are likely to become more mainstream. If you want to reduce execution risk, increase the pace of innovation, and deliver faster, turn your big project into a group of smaller projects and let the teams get to work.