Chapter 11 im

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EFFECTIVE TEAM MANAGEMENT
OVERVIEW OF THE CHAPTER
This chapter examines in detail groups and teams, how they can contribute to increased
organizational effectiveness, and the various factors that influence the level of group and team
productivity. Different kinds of groups and teams are described, and the group dynamics that
influence the functioning and effectiveness of groups are outlined. The chapter also discusses
how managers can motivate group members to achieve organizational goals and how social
loafing in groups and teams can be reduced.
LEARNING OBJECTIVES
1. Explain why groups and teams are key contributors to organizational effectiveness. (LO1)
1. Identify the different types of groups and teams that help managers and organizations
achieve their goals. (LO2)
2. Explain how different elements of group dynamics influence the functioning and
effectiveness of groups and teams. (LO3)
3. Explain why it is important for groups and teams to have a balance of conformity and
deviance and a moderate level of cohesiveness. (LO4)
4. Describe how managers can motivate group members to achieve organizational goals and
reduce social loafing in groups and teams. (LO5)
MANAGEMENT SNAPSHOT: TEAMS EXCEL IN DIVERSE INDUSTRIES
Managers at Louis Vuitton, the most profitable luxury brand in the world, and managers at
Nucor Corporation, the largest producer of steel and biggest recycler in the U.S., have both
succeeded in using teams to help their organizations become leaders in their respective
industries. At Vuitton, teams have between 20 to 30 members that work with one product at a
time. Hence, a team with 24 members might produce 120 handbags per day. Team members
are empowered to take ownership for the goods they produce, encouraged to suggest
improvements, and are kept up-to-date on key management facts such as popularity and
selling price of products.
Production workers at Nucor are organized into teams ranging from eight to forty members,
based upon the kind of work the team is doing. Each team develops its own informal rules for
behavior and makes its own decisions, with managers acting as coaches or advisors. Team
members are eligible for weekly bonuses based on the team’s performance. Because all
members of a team receive the same amount of weekly bonus money, they are motivated to
do their best for the team.
Jones and George, Essentials of Contemporary Management, Third Edition 11-1

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LECTURE OUTLINE
I. GROUPS, TEAMS, AND ORGANIZATIONAL EFFECTIVENESS (LO1)
A group may be defined as two or more people who interact with each other to accomplish
certain goals or meet certain needs. A team is a group whose members work intensely with
each other to achieve a specific common goal or objective.
• All teams are groups, but not all groups are teams.
• The two characteristics that distinguish teams from groups are the intensity with which
team members work together and the presence of a specific, overriding team goal or
objective.
• In this chapter, the term group refers to both groups and teams.
• Because members of teams do work intensely together, teams can be difficult to form,
and it may take time for team members to learn how to effectively work together.
• Groups and teams can help an organization gain a competitive advantage by: 1)
enhancing organizational performance, 2) increasing responsiveness to customers, 3)
increasing innovation, and 4) increasing levels of employee motivation and job
satisfaction.
Groups and Teams as Performance Enhancers
One of the main advantages of using groups is the opportunity to obtain synergy. People
working in a group are able to produce more than would have been produced if each person
had worked separately. Synergy is described by statement that ‘the whole is more than the
sum of its parts.’
• To take advantage of the potential for synergy in groups, managers need to make sure
that groups are composed of members who have complementary skills and knowledge.

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• To promote synergy, managers need to empower their subordinates and be coaches,
guides, and resources for groups, while refraining from playing a directive or
supervisory role.
• When tasks are complex and involve highly sophisticated and rapidly changing
technologies, achieving synergies in teams often hinges on having the appropriate mix
of backgrounds and areas of expertise represented on the team.
Groups, Teams, and Responsiveness to Customers
Being responsive to customers often requires the wide variety of skills found in different
departments. In a cross-functional team, the expertise and knowledge of different
organizational departments are brought together into a team environment in order to enhance
responsiveness to customers.
Teams and Innovation
• Innovation, the creative development of new products, new services, or even new
organizational structures, can be better managed by creating teams of diverse
individuals who together have the necessary knowledge for innovation.
• In addition, team members can often uncover each other’s errors or false assumptions,
critique each other’s approaches, and complement each other’s strengths while
compensating for weaknesses.
• To further promote innovation, managers should empower teams by making their
members fully responsible and accountable for the innovation process. To speed
innovation, managers must form teams in which each member brings a unique
resource to the team. Successful innovation sometimes requires that managers form
teams with members from different countries and cultures.
Groups and Teams as Motivators
• Members of groups and teams are likely to be more highly motivated and satisfied
than they would have been if they were working on their own. This is because
working alongside other highly charged people can be stimulating, which allows team
members to more readily see how their efforts contribute to achievement of
organizational goals.
• This increased motivation and satisfaction can also lead to other outcomes, such as
lower turnover, satisfaction of team members’ need for social interaction, and
improved ability of team members to cope with work stress.

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• Effectively managed groups and teams can help managers in their quest for high
performance, responsiveness to customers, and employee motivation.

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II. TYPES OF GROUPS AND TEAMS (LO2)
To achieve their goals, managers can form various types of groups and teams. Formal groups
are groups that managers establish to achieve organizational goals.
• Cross-functional teams are formal groups composed of members from different
departments and of members from different cultures or countries.
• Sometimes organization members form informal groups on their own because they
feel that it helps them achieve their personal goals or needs.
The Top-Management Team
A central concern of the CEO and president of a company is to form a top management team
to help the company achieve its mission and goals. This team is responsible for developing
the strategies that result in an organization’s competitive advantage.
• Most top-management teams have between five and seven members and many are also
cross-functional.
• Diversity within the top management team helps guard against groupthink, faulty
group decision making that results when group members strive for agreement at the
expense of an accurate assessment of the situation.
Research and Development Teams
Managers in high-tech industries often create research and development teams to develop
new products. Managers select R&D team members on the basis of their expertise and
experience in a certain area. Sometimes R&D teams are cross-functional teams with members
from many departments.
Command Groups
A command group is a group composed of subordinates who report to the same supervisor.
Often they are called a department or unit. When top managers design an organization’s
structure and establish reporting relationships and a chain of command, they are creating
command groups.

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Task Forces
Managers often form task forces to solve a specific problem or accomplish specific goals
within a certain period of time. Task forces are also called ad hoc committees. Once the task
force accomplishes its goal or resolves its problem, it usually disbands.
• They can be a valuable tool for busy managers who do not have the time to explore an
important issue in depth.
• Task forces that are relatively permanent are often referred to as standing committees.
Membership in standing committees changes over time. Managers often form and
maintain standing committees to make sure that important issues continue to be
addressed.
Self-Managed Work Teams
Self-managed work teams are teams in which team members are empowered with the
responsibility and autonomy to complete identifiable pieces of work. Team members decide
what the team will do, how it will do it, and which team members will perform which specific
tasks. Managers provide teams with overall goals but let team members decide how to meet
those goals. Managers usually form self-managed work teams to improve quality, increase
motivation and satisfaction, and lower costs.
Managers can take a number of steps to ensure that self-managed work teams are effective
and help an organization gain a competitive advantage:
• Give teams enough responsibility and autonomy to be truly self-managing. Refrain
from telling team members what to do or solving problems for them, even if you as
manager know what should be done.
• Make sure that a team’s work is sufficiently complex so that it entails a number of
different steps or procedures that must be performed and results in some kind of
finished end product.
• Carefully select members of self managed work teams. Team members should have
the diversity of skills needed to complete the team’s work, have the ability to work
with others and want to be part of a team.
• As a manager, realize that your role vis-à-vis self-managed work teams calls for
guidance, coaching, and support, not supervision. You are a resource for teams to turn
to when needed.

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• Analyze what type of training team members need and provide it. Working in a self-
managed work team often requires that employees have more extensive technical and
interpersonal skills.
Self-managed teams can run into trouble if members are reluctant to discipline on another.
Virtual Teams
Virtual teams are composed of members who rarely or never meet face-to-face and interact by
using various forms of information technology. As organizations are becoming increasingly
global, virtual teams allow employees to solve problems and explore opportunities without
being limited by geographic location.
• Virtual teams might even include members who are not part of the organization, but
who are part of an organization used for outsourcing.
• Virtual teams rely on two forms of information technology: synchronous and
asynchronous technology. Synchronous technology enables virtual team members to
communicate and interact with each other in real time and simultaneously through
videoconferencing, teleconferencing, and electronic meetings. Asynchronous
technologies delay communication, as with e-mail or Internet websites.
• One of the challenges virtual team members face is building a sense of camaraderie
and trust among each other. To address this challenge, some organizations schedule
opportunities for virtual team members to meet. Research suggests that while some
virtual teams can be as effective as traditional teams, virtual team members might be
less satisfied with teamwork efforts and have fewer feelings of camaraderie or
cohesion.
• Research also suggests that it is important for managers to keep track of virtual teams
and intervene when necessary.
Friendship Groups
Friendship groups are informal groups composed of employees who enjoy each other’s
company and socialize with each other. Friendship groups help satisfy employees’ needs for
interpersonal interaction and can provide social support in times of stress. The informal
relationship that managers build in these groups can often help them solve work-related
problems.

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Interest Groups
Employees form informal interest groups when they seek to achieve a common goal related to
their membership in an organization. Interest groups can provide managers with insights into
the issues and concerns that are important to employees. These groups can also signal the
need for change.
III. GROUP DYNAMICS (LO3)
The ways in which a group functions depend upon a number of group characteristics and
processes known as group dynamics. Five key group dynamics will be discussed: group size
and roles, group leadership, group development, group norms, and group cohesiveness.
Group Size
The number of members in a group can be an important determinant of members’ motivation
and commitment, as well as overall group performance.
• Members of small groups, between two and nine members, tend to interact more with
each other, find it easier to coordinate their efforts, and tend to be more motivated,
satisfied, and committed. They also find it easier to share information and to see the
importance of their personal contributions for group success.
• A disadvantage of small versus large groups is that members of small groups have
fewer resources available to accomplish their goals.
• Large groups with ten or more members offer some advantages. They have more
resources at their disposal to achieve group goals, such as the knowledge, experience,
skills, and abilities of group members. They can also capitalize upon the advantages
that stem from the division of labor.
• The disadvantages of large groups include problems of communication and
coordination and lower levels of motivation, satisfaction, and commitment.
• When deciding upon the appropriate size for any group, managers should attempt to
gain the advantages of small group size while also forming groups with sufficient
resources to accomplish their goal. As a general rule, groups should have no more
members than necessary to achieve the required division of labor.
• In R&D teams, group size is too large when: 1) members spend more time
communicating what they know to others than applying what they know to solve
problems and create new products, 2) individual productivity decreases, and 3) group
performance suffers.

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Group Roles
A group role is a set of behaviors and tasks that a member of a group is expected to perform
because of his or her position in the group.
• Members of cross-functional teams are expected to perform roles relevant to their
special areas of expertise.
• Managers need to clearly communicate to group members the expectations for their
role in the group, what is expected of them, and how the different roles in the group fit
together.
• Managers should encourage role making, taking the initiative to modify an assigned
role by assuming additional responsibilities.
• In self-managed work teams, group members themselves are responsible for creating
roles.
Group Leadership
All groups and teams need leadership. Sometimes managers assume the leadership role or
appoint a member of a group. In other cases, group or team members may choose their own
leaders, or a leader may emerge naturally. Sometimes self-managed work teams rotate the
leadership role among members.
Group Development over Time
It sometimes takes a self-managed work team two or three years to perform up to its true
capabilities. What a group is capable of achieving depends in part upon its stage of
development. Researchers have identified five stages of group development that many groups
seem to pass through.
• In the first stage, forming, members try to get to know each other and reach a common
understanding.
• In the second stage, storming, group members experience conflict and disagreements.
• During the third stage, norming, close ties between group members develop.
• In the fourth stage, performing, the real work of the group gets accomplished.
• The last stage, adjourning, applies only to groups that eventually are disbanded.

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Group Norms
• Group norms are shared guidelines or rules for behavior that most group members
follow. Groups develop norms concerning a wide variety of behaviors, including work
hours, sharing information, how tasks are performed, and how members should dress.
• Managers should encourage members to develop norms that contribute to group
performance and the attainment of group goals.
Conformity and Deviance
• Group members conform to norms because: 1) they want to obtain rewards and avoid
punishments, 2) they want to imitate group members whom they like and admire, and
3) because they have internalized the norms and believe that they are the right and
proper way to behave.
• Failure to conform, or deviance, occurs when a member of a group violates a group
norm. Deviance signals that the group is not controlling its members’ behaviors.
Groups generally respond to members who behave defiantly in one of three ways: 1)
the group might try to get the member to change his or her deviant ways and conform,
2) the group might expel the member, or 3) the group might change the norm so that it
is consistent with the member’s behavior.
• The last alternative suggests that some deviant behavior can be functional for a group.
Deviance is functional when it causes group members to stop and evaluate norms that
may be dysfunctional but taken for granted.
Encouraging a Balance of Conformity and Deviance
• In order for groups and teams to be effective, they need to have the right balance of
conformity and deviance. A group needs a certain level of conformity to control
members’ behavior. A group also needs a certain level of deviance to ensure that
dysfunctional norms are discarded.
• Managers can take steps to ensure that there is some tolerance of deviance in groups.
They can: 1) be role models for the group, 2) let employees know that there are always
ways to improve group processes, and 3) encourage members of groups and teams to
assess existing norms.

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Management Insight: Teams Benefit from Deviance and Conformity at IDEO
Ideo has designed many successful new products, such as the first Apple mouse and the Palm
handheld organizer. Managers and designers at Ideo see themselves as experts in the process
of innovation. Innovation and new product development at Ideo is a team effort. The company
recognizes that it is through diversity in thought that people can recognize opportunities for
innovation. Paradoxically, both conformity and deviation are encouraged on Ideo teams.
Conformity to a few very central norms is expected, but diversity of thought and even
deviance is encouraged as a means of promoting innovation.
Group Cohesiveness
Group cohesiveness is the degree to which members are attracted or loyal to their group.
When group cohesiveness is high, individuals strongly value their group membership. When
group cohesiveness is low, group members have little desire to retain their group membership.
Research indicates that managers should strive to have a moderate level of cohesiveness in
the groups.
Consequences of Group Cohesiveness
There are three major consequences of group cohesiveness: levels of participation within the
group may change, levels of conformity to group norms may change, and emphasis on group
goal accomplishment may change.
Level of Participation Within a Group: As group cohesiveness increases, the extent of group
members’ participation within the group increases. A moderate level of group cohesiveness
helps to ensure that group members actively participate in the group. Too much cohesiveness
can reduce efficiency.
Level of Conformity to Group Norms: Increasing levels of group cohesiveness result in
increasing levels of conformity to norms. Too much conformity may result in conforming to
norms even when they are dysfunctional. Low cohesiveness can result in too much deviance
and can undermine group control.
Emphasis on Group Goal Accomplishment: As group cohesiveness increases, emphasis on
group goal accomplishment increases within the group. For an organization to be effective,
the different groups need to cooperate with each other and to be motivated to achieve
organizational goals. A moderate level of cohesiveness motivates group members to
accomplish both group and organizational goals.

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Factors Leading to Group Cohesiveness
Four factors contribute to the level of group cohesiveness. These determinants of group
cohesiveness are group size, effectively managed diversity, group identity, and healthy
competition and success.
Group Size: Members of small groups tend to be more motivated and committed. To promote
cohesiveness in groups, managers should form groups that are small to medium in size.
Effectively Managed Diversity: Although people tend to like and get along with others who
are similar to them, diversity in groups, teams, and organizations can help an organization
gain a competitive advantage. Diverse groups often come up with more innovative and
creative ideas.
Group Identity and Healthy Competition: Managers can increase group cohesion by
encouraging groups to develop their own identities and engage in healthy competition.
Healthy competition among groups is promoted by displaying measures of each team’s
performance and the extent to which they have met their goals to others. Conversely,
managers can decrease cohesiveness by promoting organizational identity rather than group
identity, reducing or eliminating competition between groups, and rewarding cooperation
between groups.
Success: As groups become more successful, their cohesiveness tends to increase. Managers
can increase cohesiveness by making sure that a group can achieve some visible success.
IV. MANAGING GROUPS AND TEAMS FOR HIGH PERFORMANCE
Managers striving to have top performing groups and teams need to: 1) motivate group
members to work toward the achievement of organizational goals, 2) reduce social loafing,
and 3) help groups to manage conflict effectively.
Motivating Group Members to Achieve Organizational Goals
When work is difficult, tedious, or requires a high level of commitment, managers cannot
assume that group members will always be motivated to work toward the organizational
goals.
• Managers can motivate members by making sure that the members themselves benefit
when the group or team performs highly.

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• Managers often rely on some combination of individual and group-based incentives to
motivate members of groups. A major challenge is to develop a fair pay system that
will lead to high individual motivation and high group performance.
• Other benefits that managers can use include providing extra resources, bestowing
awards and recognition, and offering a choice of future work assignments.
Ethics in Action: Valero Energy’s Commitment to Employees Prevails in a Crisis
In ten years, Valero Energy has grown from a single oil refinery to the largest refiner, in the
United States with eighteen refineries. The CEO has always realized that Valero’s employees
are the backbone of the company and has been steadfast in his commitment to them. In 2006,
Valero was ranked third in Fortune’s 100 Best Companies to Work For. When describing this
company, Fortune Magazine wrote, “When disaster strikes, this team pulls together. After
Hurricane Katrina and Rita hit, Valero dispatched semis filled with supplies, set up temporary
housing for employees, fed volunteers, and donated $1 million to the Red Cross.
Reducing Social Loafing in Groups
Social loafing is the tendency of individuals to put forth less effort when they work in groups
than when they work alone. It can result in lower group performance and may even prevent
the group from attaining its goals.
To reduce or eliminate social loafing, managers can:
• Make individual contributions to a group identifiable. Group members should
perceive that low and high levels of effort will be noticed and individual contributions
evaluated. Managers can assign specific tasks to group members and hold them
accountable for their completion. Sometimes the members of a group can cooperate to
eliminate social loafing by making individual contributions identifiable. However, in
some teams, individual contributions cannot be made identifiable.
• Emphasize the valuable contributions of individual members. People sometimes
think that their efforts are unnecessary or unimportant when they work in a group.
When managers form groups, they should assign individuals to groups on the basis of
the valuable contributions that each person can make.

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• Keep group size at an appropriate level. As size increases, members are
increasingly likely to think that their individual contributions are not important.
Managers should form groups with no more members than are needed to accomplish
group goals.
Helping Groups to Manage Conflict Effectively
• Practically all groups experience either intragroup or intergroup conflict. The effective
management of conflict is discussed in Chapter 16.
V. SUMMARY AND REVIEW
LECTURE ENHANCERS
Lecture Enhancer 11.1
TEAMWORK AND NASCAR
New MBA students at Wake Forest University’s Babcock Graduate School of Management
learned teambuilding skills on the fast track – literally – by participating in the Richard Petty
Ultimate Racing Experience at Lowe’s Motor Speedway in Concord, North Carolina. The
university used NASCAR driver and pit crew techniques to instill the value of teamwork by
providing students with an opportunity to participate in a team-building exercise.
Here’s how the exercise worked: Each team member was assigned a series of responsibilities.
For example, one team member was responsible for leading the racecar toward the pit stop
while another took a turn riding in a car with a professional driver. Students were not allowed
to drive. The cars raced around the tack for a series of eight to ten laps. Then team member
roles were switched. Every student had the opportunity to perform each of the various
assigned tasks. Team members who failed to complete the assignment correctly had to start
over, thus setting the team back. The winning team was recognized at the end of the evening.
In addition to building team skills, these students gained exposure to a booming business
enterprise that has become one of the nation’s fastest-growing sports. As with other winning
enterprises, NASCAR drivers and crews rely on solid teamwork to succeed. Even with all of
the emphasis that NASCAR places upon high-performing equipment, the best racecar cannot
consistently perform well without a team that is focused on common goals and is using
common processes for accomplishing their tasks. Some of the characteristics of teamwork
observed in NASCAR auto racing organization include:

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Common goals: Daily plans and schedules, weekly plans and schedules, race objectives
Common processes: Daily morning meetings, Tuesday evening post-race meetings, pit crew
practice sessions, checklists for each car
Regular feedback: Daily discussions about the prior day’s accomplishments, immediate
feedback on the performance of the car and the team’s efforts every time the car takes a lap
and finishes a race
Rewards and recognition: Team members sharing in the winnings and awards,
congratulatory messages and tokens of appreciation after each race, sponsor recognition of the
team, media appearances
Focused leadership: Leaders provide common focus for the team, facilitating timely feed
back on individual and collective performance, providing needed resources for accomplishing
responsibilities, holding team and individuals accountable for assigned tasks, walking the talk,
committed to openness and honesty, listening, listening, listening
Individual strengths: Specialized skills and knowledge respected within the team and
continually improved in ‘multi-skill’ job roles
Ownership: A sense of team ownership for everything they do rather that singling out an
individual
Adapted from “Wake Forest MBA students Learn Teamwork from NASCAR Pit Crew Techniques, Business Wire, August 16,
2004 and Robert M. Williamson, “NASCAR:A Model for Equipment Reliability and Teamwork”, MRO Today, Copyright
2000.
REWARDS AND CHALLENGES OF WORKING IN A TEAM
A common type of team is the temporary unit, usually composed of members from different
departments and job levels, formed to make policy, re-engineer operations, or design
products, among other tasks. Team members may or may not leave their old jobs.
Working in a team environment can be tricky. On one hand, you get to showcase your skills
to team members from all corners of the company, often including influential senior
executives. And team assignments tend to be critical and closely watched.

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But that also means that if the team flops, you flop, whatever the reason. Meanwhile, while
you are focusing on your new team duties, some young gun in your department is showing
how easily you can be replaced. And because teams often challenge traditional departmental
roles, the potential for a political tug-of-war is high.
Shaunna Sowell’s team experiences at Texas Instruments led to promotions and a better
career path than she ever envisioned. But she also burned some bridges with a boss. Sowell
was leading a plant design team in 1988 when she was tapped for a product-quality steering
committee that was loaded with managers. She initially was intimidated, but her confidence
grew with her experience.
“I left one meeting thinking, ‘I’ve ruined my career”, she recalls. I’d just told a guy four
levels above me that he was wrong. Actually, she impressed an executive on the team who
was looking around for a vice president of Corporate Environmental Safety. “You have to be
a great individual contributor”, she says, “that’s how you get picked for the next team”. Her
team involvement, she says, earned her recognition, job offers, and mentoring from senior
executives she never would have gotten in the days before teams.
But the experience also created friction. “My visibility was getting wider than that of my
boss”, she said. “It was pretty uncomfortable”. The relationship cooled and eventually she
moved to another position, although still working on teams.
Mary Kinnear feared she risked her career at Boston Gas by joining a re-engineering tem. The
gamble paid off, but not without some uncomfortable moments. In leading a team charged
with redesigning Boston Gas’s distribution operation, Ms. Kinnear, a human resources
specialist, also knew she risked offending some influential executives whose turf was being
threatened. Some already voiced skepticism about her abilities to do effective work on the
team, she said. “We were all assured there would be some kind of amnesty for team
members”, she says. “But there were no guarantees”.
When the project ended, however, she was eventually named general manager of one of the
eight regional operating divisions created by the project team. Absent the project team, she
says she wouldn’t have had the experience or the exposure to land her current job.
Sometimes the fears are real. Deloitte & Touche consultant Boris Lukan was part of a joint re-
engineering team working with a client, when animosity over cutbacks proposed by the
project team forced one team member from the client company to leave. “For people who
want to be recognized, projects that drive change are great places to be”, he says, “but you’ve
got to be ready for the potential impacts that could come out of upsetting how other people do
their work”.

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Still, such influence became so seductive to Margaret Colquhoun, who was on a team
reshaping the work processes at her hospital, that she found it difficult to go back to the
humdrum routine of her manager’s job, even after a promotion. She left to join a consulting
firm that specializes in team development.
These managers offer some advice to others working in teams:
• Be an expert, not an advocate. The team needs your specialized knowledge, but doesn’t
want an obstructionist who continually says, “You just don’t understand how we do things
in finance”.
• Research the team as you would any job opportunity. Are there cliques? Is there one
person who dominates? What happens to team members after they leave the team? How
strong is management support?
• Make sure you keep up your performance in your department. “You cannot fail at
your core hierarchical work, succeed at your team work, and be successful overall”, Ms.
Sowell says. Also, she urges, keep your department boss informed of your team activities.
In most companies, that person still has the most influence on your career.
• Stay balanced. “Overload and burnout are more of a problem in teams”, Ms. Sowell says.
Being sought after for influential teams is flattering, but you must be careful about
overcommitting. Each year, Ms. Sowell drafts a contract detailing what she’s committing
to do that year and shares it with her staff.

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• See yourself as an equal. Be diplomatic, but don’t hold back your opinions. This is your
stage, with an audience that often includes some of the company’s most influential people.
Don’t waste it.
SOCIAL LOAFING
Professor Bibb Latane, a professor of psychology, conducted research on social loafing at
Ohio State University in the 1980s. Latane concluded people tend to slack off, or loaf, when
they work in a group more than they do when working alone.
Much of Latane’s experimentation was done by he and his colleagues in his offices under the
stands of the Ohio Stadium. There the researchers organized Buckeye student volunteers into
groups of varying sizes and asked them to clap or shout as loud as they could. In this and
other experiments, the researchers found that when subjects either were in a group or were led
to believe that they were (through the use of blindfolds and headphones), they consistently
made less noise per person than when they shouted or clapped alone.
Mr. Latane concluded from this and earlier research that there is a “diffusion of
responsibility” in groups. Each person feels less responsible for helping because others are
present. The applications to a work environment are unclear. Another research psychologist
noted that “those people [who were clapping] weren’t out earning money to pay their
mortgages or feed their families”.
MANAGEMENT IN ACTION
Notes for Topics for Discussion and Action

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Discussion
1. Why do all organizations need to rely on groups and teams to achieve their goals and
gain a competitive advantage? (LO1)
All organizations need to rely on groups and teams to achieve their goals and gain a
competitive advantage because groups can enhance performance, increase responsiveness
to customers, increase innovation, and increase employees’ motivation and satisfaction.
People working in groups are able to produce more or higher-quality outputs than would
have been produced if each person had worked separately and all their individual inputs
were combined. Being responsive to customers often requires the wide variety of skills
and experience found in different departments, which can be combined in cross-functional
teams. Managers can better encourage innovation by creating teams of diverse individuals
who together have the knowledge relevant to a particular type of innovation, rather than
relying on individuals working alone. Also, employees who work in teams are more likely
to be more highly motivated and satisfied, and may experience lower levels of turnover.
2. What kinds of employees would prefer to work in a virtual team? What kinds of
employees would prefer to work in a team that meets face-to-face? (LO2)
Employees who prefer working in a virtual team would likely be independent, self-
starters. They would also already possess a high-degree of skills and would, therefore, not
require intensive training or close supervision. Employees preferring to work face-to-
face, on the other hand, would tend to enjoy social interaction and to be motivated by
working closely with others. Employees with fewer skills or less experience would also
be likely to need more face-to-face contact for training purposes.
3. Think about a group that you are a member of, and describe the stage of development that
your group is currently in. Does the development of this group seem to be following the
forming-storming-norming-performing-adjourning stages described in the chapter?
(LO3)

CHAPTER ELEVEN
The stages of development that groups go through in the process of achieving their goals
include forming, storming, norming, performing, and adjourning. When team members
initially get to know each other and establish a group objective and understanding of the
goal, it is “forming”. Storming often occurs within groups, characterized by conflict and
disagreement between group members. The third stage, norming, occurs when close ties
form between group members and feelings of friendship and camaraderie emerge.
Performing is when the work is done and the group effectively completes their task or
objective. Adjourning applies only to groups that are eventually dissolved, and group
members leave the group, perhaps to work in other groups where their services are
needed.
4. Discuss the reasons why too much conformity can hurt groups and their organizations.
(LO4)
There are several reasons why people conform to group norms: they want to obtain
rewards and avoid punishments, they want to imitate group members they admire, or they
have internalized group norms and believe that is the right way to behave. Conformity is
necessary for a group to succeed in achieving its goals, but too much conformity can hurt
both groups and their organizations. Too much conformity may limit team members in
their thinking, and they may not stop to evaluate norms that may be dysfunctional but are
taken for granted by the group. Norms often need to be adjusted over time, and too much
conformity may limit the new ideas that would otherwise emerge in a more flexible
environment. If a group fails to perform at a high level due to dysfunctional norms, the
group performance and organizational performance will suffer.

CHAPTER ELEVEN
5. Why do some groups have very low levels of cohesiveness? (LO5)
Group cohesiveness, or the degree to which members are attracted or loyal to their group
or team, is affected by four factors. Some groups have very low levels of cohesiveness,
which may be caused by one or more factors. Group size is one factor, with members of
small groups more motivated and committed than members of large groups. A group with
low cohesiveness may simply be too large. Second, in forming groups, managers need to
select members with diversity in knowledge, skills, and experience. Managers need to
make sure that diversity is effectively managed, because if it is not, it may lead to low
cohesiveness. Groups also need to have identities. Those groups with low cohesiveness
may simply need to develop their own identities and personalities, and engage in healthy
competition with other groups. Finally, a group with low cohesiveness may need to
experience some success in order to raise their cohesiveness level. When a group achieves
noticeable and visible success, it contributes substantially to its feelings of cohesiveness
and camaraderie.
6. Imagine that you are the manager of a hotel. What steps will you take to reduce social
loafing by members of the cleaning staff who are responsible for keeping all common
areas and guest rooms spotless? (LO5)
Social loafing occurs in groups when individuals put forth less effort because they believe
that their individual contribution will not be noticed within the context of the group. This
behavior can result in lower group performance and may prevent a group from attaining
its goals.
A manager can take several steps to reduce social loafing. One tactic is to make individual
contributions to the group identifiable, so that group members perceive that low and high
levels of effort will be noticed and individual contributions evaluated. Staff may be
assigned room numbers at random and common areas that they are responsible for, which
would help identify the worker responsible when a task has not been completed. Managers
may also emphasize the valuable contributions of each staff member, and assign
individuals to groups on the basis of the valuable contributions that each person can make
to the group as a whole. A manager could emphasize and communicate why a maid, a
bellhop, a desk clerk, and a laundry attendant are each unique, and how each contributes
important skills to the group. Finally, a manager can overcome social loafing by limiting
the size of the group. The hotel should have no more cleaning staff than are needed to
keep all common areas and guest rooms spotless.

CHAPTER ELEVEN
Action
7. Interview one or more managers in your community to identify the types of groups and
teams that the organization uses to achieve its goals. What challenges do these groups
and teams face? (LO2)
There are various types of groups and teams created by managers and organizational
members. Formal groups are groups that managers establish to achieve organizational
goals. This category includes cross-functional teams, cross-cultural teams, top
management teams, research and development teams, command groups, task forces, and
self-managed work teams. Cross-functional teams are made up of members from different
departments, and cross-cultural teams have members from different cultures or countries.
Top management teams have a variety of managers on their teams, with the hopes of
helping the organization achieve its mission and goals. Subordinates who report to the
same supervisor compose command groups. Task forces are formed to address specific
problems or accomplish specific goals. Self-managed work teams have members who are
empowered to complete identifiable pieces of work. Formal groups like these are usually
established by managers interested in improving organizational performance, efficiency,
and effectiveness.
Organizational members form informal groups, such as friendship groups and interest
groups, because they feel that these groups will help them achieve their own goals or meet
their own needs. These groups are formed when employees wish to socialize with each
other, or achieve a common goal related to their membership in an organization.
AACSB standards: 1, 3, 6, 10
Notes for Building Management Skills (LO 1, 2, 3, 4, 5)
(Note to the instructor: Due to the nature of this question, student answers will vary. The
following answers illustrate main points that each student should include.)
1. What type of group was this?
Groups may be formal or informal. Formal groups are established to achieve organizational
goals, and include cross-functional teams, cross-cultural teams, top management teams,
research and development teams, command groups, task forces, and self-managed work
teams. Informal groups are created by organizational members because they feel that groups
will help them achieve their own goals or meet their own needs. These groups include
friendship groups and interest groups.

CHAPTER ELEVEN
2. Were group members motivated to achieve group goals? Why or why not?
Many factors contribute to the motivation of group members to achieve group goals.
Group members who are given autonomy and variety in their task assignments are more
likely to be highly motivated. Groups that encourage diversity and communication will
also have highly motivated members. Members may also be more motivated if they have
formed the group themselves, as is the case in friendship and interest groups. Smaller
groups often have more motivated and committed members than larger groups. A number
of other factors may contribute to motivation, such as pay level and determination of
bonuses based on individual and group performance.
3. How large was the group and what group roles did members play?
The size of a group can be an important determinant of motivation, commitment, and team
performance. Large groups have ten or more members, and offer the advantage of
increased resources and division of labor. Small groups, those with between two and nine
members, often have members who are more motivated, satisfied, and committed. Small
groups also make it easier for members to communicate ideas, coordinate activities, and
share information.
A group role is a set of behaviors and tasks that a member of a group is expected to
perform because of his or her position in the group. Often, group roles are related to each
member’s area of expertise.
4. What were the group’s norms? How much conformity and deviance existed in the group?
Group norms are developed in order to control members’ behaviors to ensure that the
group performs effectively and meets its goals. Group members are expected to follow
these shared guidelines or rules for behaviors. Moderate conformity to these norms is
necessary to achieve high performance. Low conformity and high deviance or failure to
conform can result in low performance because the group cannot control its members’
behaviors. Too much conformity and not enough deviance can result in low performance
because the group is reluctant to change existing dysfunctional norms.
A balance of conformity and deviance can be achieved by managers who act as role
models of tolerance and acceptance for the groups and teams they oversee. Managers can
also communicate to members of a team that improvement is always possible, and that
opportunities to replace existing norms should be considered a means of achieving group
goals and high performance.

CHAPTER ELEVEN
5. How cohesive was the group? Why do you think the group’s cohesiveness was at this
level? What consequences did this level of group cohesiveness have for the group and its
members?
Group cohesiveness is the degree to which members are attracted or loyal to their groups
or teams. Cohesiveness can be high, moderate, or low. When cohesiveness is high,
members value their group membership, and wish to remain members. When
cohesiveness is low, group members do not value the group, and do not care to stay in the
group. Research suggests that a moderate level of cohesiveness is optimal and is most
likely to contribute to an organization’s competitive advantage.
Group cohesiveness can be affected by the size of the group, the way that diversity is
managed within the group, and whether the group has their own identity and engages in
healthy competition with other groups.
The level of cohesiveness within a group or team can have several consequences for the
group and its members. As group cohesiveness increases, the extent of group members’
participation within the group increases. A moderate level ensures that group members
interact and communicate with one another, though not so much that they do not perform
their roles. Increasing levels of cohesiveness can also increase conformity to group norms.
Too much cohesiveness may discourage deviance needed to change dysfunctional norms,
and moderate cohesiveness is recommended. Additionally, group cohesiveness increases
result in an increase in emphasis placed on group goal accomplishment. A moderate level
of cohesiveness is best, allowing a group to achieve organizational goals, in addition to
those of the group.
6. Was social loafing a problem in this group? Why or why not?
Social loafing occurs when individuals put forth less effort when they work in groups than
when they work alone. It may be a problem in groups where it is difficult to identify
individual performance.
In order to counter the effects of social loafing, managers need to make individual
contributions identifiable so that group members perceive that low and high levels of
effort will be noticed and individual contributions evaluated. Managers may also assign
individuals to groups on the basis of the valuable and unique contributions that each
person can make to the group as a whole. In addition, groups should be kept as small as
possible. Small groups allow individual contributions to be more easily recognized and
valued.

CHAPTER ELEVEN
7. What could the group’s leader or manager have done differently to increase group
effectiveness?
Managers can take many steps to increase group effectiveness. Some examples include:
making sure that groups are diverse in terms of expertise and knowledge; empowering
subordinates and acting as coaches, guides, and resources; making teams responsible and
accountable for their progress; limiting the size of groups; encouraging improvement and
periodic evaluation of the “status quo”; acting as effective leaders and good examples;
creating self-managed teams that are responsible for a whole set of tasks that yields an
identifiable output; giving teams autonomy and responsibility.
8. What could group members have done differently to increase group effectiveness?
Group members can also take certain steps to increase their group effectiveness. Some
examples include: bringing motivation and commitment to the group; bringing diverse and
unique knowledge and skills to the group; communicating with other group members and
sharing information; cooperating with other group members when there is a disagreement;
performing their share of the work and exerting as much effort as they would if they were
working alone; encouraging other members to do their best and helping poor performers
to improve; conforming to group norms enough to achieve the common goal, but
deviating enough to change dysfunctional norms.
MANAGING ETHICALLY (LO2, 5)
(Note to the instructor: Student answers will vary.)
1. Alone, or in a group, think about the ethical implications of social loafing in a self-
managed team.
It certainly does seem not seem fair to allow one team member to work harder than others,
especially if all team members are receiving the same level of recognition and reward.
However, social loafing may occur for a variety of reasons, and therefore we should not
jump to the conclusion that laziness it the cause of this behavior. For instance, if there is a
redundancy of skill sets within the group, a team member may assume that his or her
individual contribution isn’t really needed. In such a situation, we would hope that this
employee would make fellow team members aware of the predicament, so that
adjustments can be made be in team member roles. However, if the team’s task is not
sufficiently complex or if communication problems exist between team members, such
adjustments may be difficult to make.

CHAPTER ELEVEN
2. Do managers have an ethical obligation to step in when they are aware of social loafing in
a self-managed team? Why or why not? Do other team members have an obligation to try to
curtail the social loafing? Why or why not?
Because it is the responsibility of the entire team to ensure that it functions as efficiently
as possible, members must attempt to curtail any social loafing that occurs. Although
some team members may find it uncomfortable to discipline another member, failure to do
so may result in a decline in team motivation. As a coach that provides guidance and
support to the self-managed team, the manager should assist in resolution of this problem,
if team members are unable to work it out on their own.
AACSB standards: 1, 2, 3, 7, 9, 10
NOTES FOR SMALL GROUP BREAKOUT EXERCISE (LO2, 3, 4)
Creating a Cross-Functional Team
1. Indicate who should be on this important cross-functional team and why.
Since the team is cross-functional, team members should come from a variety of
departments. The team should have a member who is responsible for monitoring costs and
maintaining the food services budget. The team should also have at least one of the eight
cafeteria managers who is knowledgeable about the day-to-day operations of the
cafeterias. A faculty member or graduate student from the management department on
campus might be brought onto the team for consultation in providing quality customer
service and efficient food delivery. An experienced cafeteria worker might be included on
the team to give an employee’s perspective on problems within the cafeterias. A
nutritionist could be brought in to give suggestions for new, more healthful menu items. A
student representative, who would be able to give the team ideas for meals and snacks that
would appeal to students, should also be a part of the team. An administrator may be
helpful to suggest hours that are most convenient for faculty and students.
2. Describe the goals the team should be trying to achieve.
The goals that the team should be trying to achieve should be the ones that remedy the
problems that the cafeterias are experiencing. The faculty and students have responded to
the survey, and have expressed their dissatisfaction with the current schedule, menus, and
service.

CHAPTER ELEVEN
The team should try to improve the menu in the cafeterias. This improvement should
result from a wider range of choices and the addition of more health-conscious items. The
team should try to devise a vegetarian and a low-fat, high-fiber menu that appeals to both
students and faculty. The team should also try to improve quality, and ensure that
cafeterias deliver food that is appropriately prepared and served at the appropriate
temperature. Another goal is to have operating hours that are convenient for a large
segment of the campus population. The main goal is to increase customer satisfaction with
the services of the cafeteria, while trying to maintain a reasonable budget and controlling
costs to students and faculty. Additionally, managers and employees of the cafeterias
should be motivated and satisfied with their jobs.
3. Describe the different roles that team members will need to perform.
Group roles are sets of behaviors and tasks that members of a group are expected to
perform because of their positions in the group. Members of this team should be
performing behaviors and tasks that are related to their special areas of expertise. The
nutritionist should propose menu ideas and conduct an analysis of the nutritional content
of the current cafeteria menus in order to determine where changes need to be made. The
student should make suggestions and give feedback based on experience as a cafeteria
patron. The cafeteria worker might offer suggestions for more efficient operation in the
kitchens or food lines. The management consultant could devise a strategy to motivate
cafeteria workers to provide quality customer service. The administrative employee could
research the times when most students are likely to be at the cafeterias, for example,
during breaks between classes, and make suggestions for operating schedules. The
cafeteria manager may have the most experience in the day-to-day operations and may
serve as the group leader.
4. Describe the steps you will take to help ensure that the team has a good balance between
conformity and deviance and a moderate level of cohesiveness.
A good balance between conformity and deviance is essential to ensure that a group is
able to control members’ behavior and channel it in the direction of high performance and
group goal accomplishment. This balance also ensures that dysfunctional norms or
behaviors are discarded in favor of more functional ones. The leader of the group may
ensure tolerance of deviance and conformity to group norms by acting as a role model for
the group. The cafeteria manager can encourage and accept team members’ suggestions
for changes in menu items, service, and operating hours. Second, the manager should
assure team members that suggestions are considered and implemented to the best of his
or her ability. The manager should communicate his or her vision for an improved food
service system and the belief that changes will benefit both employees and patrons.

CHAPTER ELEVEN
The manager can ensure that the group has a moderate level of cohesiveness by making
sure that the group is only as large as is necessary, limiting the number of group members
to ten or less. The cafeteria manager can also make sure that the diversity of the team is
managed in such a way that everyone feels accepted and instrumental in achieving group
goals. Students may have different ideas than faculty or administration, and these
differences must be managed fairly. Another tactic that may be employed to ensure a
moderate level of cohesiveness is to form a group identity that makes members feel
appreciated and fortunate to be included in the process.
Notes for Be the Manager (LO 1, 2, 3, 4, 5)
You need to read some information on groups, group dynamics, and the formation of groups.
Even though this group is virtual, it still will go through the same formation sequences as any
kind. There is also the added complexity of both national culture and the company’s internal
culture. You must first make sure that the group members know each other and trust in the
process. Consider creating a chat room that everyone in the group can use to exchange
information they see of value or just to get acquainted. In addition, the compensation and
incentive structure needs to be known by all and designed so all group members will help, not
hinder each other. If too much competition develops within the group because the rules are
not clear, it will never get past the storming stage.
AACSB standards: 1, 3, 9, 10, 12
BUSINESS WEEK CASES FOR DISCUSSION
Case Synopsis: Seagate’s Morale-athon
Plenty of companies try to motivate the troops, but few go as far as Seagate Technology. This
$9.8 billion maker of computer storage hardware flew 200 of its 4,500 employees to New
Zealand for its sixth annual Eco Seagate. It is an intense week of team building topped off by
an all day race in which Seagaters had to kayak, hike, bicycle, swim and rap down a cliff.
Seagate’s CEO created this event as a way to break down barriers, boost confidence, and
make staffers better team players. Each morning, a top executive gives a presentation on a
key attribute of a strong team. That lesson carries over to the afternoon, as participants
engage in orienteering, rappelling, mountain biking, or kayaking lessons.

CHAPTER ELEVEN
Questions:
1. What is Seagate Technology seeking to accomplish with its Eco Seagate?
Watkins wants participants to experience the intensity that distinguishes a group from a high
performing team. He also wants to strengthen his company’s culture by reinforcing those
norms and attitudes that encourage team work, perseverance, and endurance.
2. How might participation in Eco Seagate contribute to effectiveness back on the job?
Skills nurtured at Eco Seagate that can contribute to on-the-job effectiveness include the
ability to follow through on commitments to others, actively listening to team members, take
responsibility for group successes and/or failures, and give as well as accept useful feedback.
3. What aspects of group dynamics does Eco Seagate focus on?
Eco Seagate focuses upon development of healthy competition and cohesion, and also the
importance of group norms and group leadership.
4. How might participation in Eco Seagate contribute to managing groups and teams for
high performance at Seagate?
From their experiences at Eco Seagate, hopefully managers cultivated and can now model the
set of skills required to effectively contribute to a high performing team. Such skills include
sharing and communicating goals among team members, creating a learning environment for
team members, empowering team members, and encouraging them through positive
expectations.
Case Synopsis: Putting Designers in the Driver’s Seat
When designer Clay Dean sat down with his team to brainstorm the redesign of the Chevy
Malibu three years ago, his mission was clear. The team needed to find an inexpensive way to
transcend the dowdy image associated with the car’s inexpensive price. In an intensely
competitive industry, automakers are attempting to develop more attractive designs as a
means of differentiating themselves and attract new consumers. For inspiration, Dean looked
to low-price consumer brands that have successfully retained flair and style, such as Panera
Bread, JetBlue Airways, and Target.
To help designers achieve this goal, the company made some changes in organizational
structure and culture. Designers were given freedom and autonomy to take the lead in
defining the vision for new autos. The company began holding design workshops at which
engineers and marketers provide designers with feedback and compromises are hammered
out. The new Malibu is scheduled for marketplace introduction in the summer of 2007.

CHAPTER ELEVEN
Questions:
1. How is GM trying to achieve synergies in teams used to design new cars?
GM executives realized that its designers and engineers needed to feel each others’ pain, i.e.,
each needed to develop an appreciation for the intricacies, difficulties, and frustrations the
other experienced in their efforts to create a new car. Synergy was achieved when these two
sets of professionals learned to work together, exchange ideas, correct each other’s mistakes,
etc.
2. How might these teams be able to increase GM’s responsiveness to customers?
Being responsive to customers often requires a wide variety of skills and expertise found in
different departments of the organization. By forming a cross functional team, GM made sure
the diversity of expertise and skill needed to be fully responsive to customers could be readily
tapped during the design process.
3. How might working in these teams contribute to employee motivation?
The experience of working alongside other highly skilled and motivated professionals can be
very stimulating. Many employees enjoy the constant interaction with others that a team
demands, as opposed to working alone. Also, team members more readily see how their
efforts contributed to the achievement of organizational goals, thereby providing them with a
sense of personal accomplishment.
4. To what extent are these teams self managed?
Vice-chairman Robert Lutz made the decision to decentralize authority and put designers in
charge of their own work. This implies that they supervised their own work and made their
own decisions concerning how goals would be achieved, hence a self managed team.

CHAPTER ELEVEN
Chapter 11 Video Case Teaching Note
Pike Place Fish
Teaching Objective: To provide an example of synergy within a high-performing team. To
show how such a team can enhance work performance, and increase innovation, motivation,
job satisfaction, and responsiveness to customers.
Video Summary: This video chronicles the Pike Place Fish Co.’s effort to become world
famous. After working with a consultant, the owner decides to abandon his autocratic
management style for one that is team-focused. The interviews of the owner, consultant, and
manager and the scenes inside the market provide an excellent example of a high-performing,
self managed work team and the dynamics that occur within it.
Questions:
1. What does it mean at Pike Place Fish to be world famous?
At Pike Place Fish, being world famous means making a difference in the lives of customers
and others with whom employees come in contact. “For us, it means going beyond just
providing outstanding service to people”, according to CEO John Yokoyama. “We’re out to
discover how we can make their day. They experience being appreciated whether they buy
fish or not”.
2. What roles do teams play in Pike Place Fish’s quest to be world famous? Why does it
take new employees time, in some cases three months, to become effective team
members?
At Pike Place Fish, there are no jobs but instead positions available for those who make the
team. Prospective employees have to commit to the purpose of being world famous to be
hired. To become a true team member, new employees must learn and practice the distinction
between being world famous, as opposed to merely wanting to be or believing you are, which
can take as long as three months.

CHAPTER ELEVEN
3. How does Pike Place Fish create the context for workers to reach their maximum
potential? What role do managers play in creating and nurturing this atmosphere?
To help employees reach their potential, Pike Place Fish creates an environment that fosters
personal growth and development, with a heavy emphasis on coaching. The intention is for
the coach to empower others to achieve. When an employee wants or needs to be coached,
everyone is expected to contribute to that effort. Everyone is allowed to coach anyone, newest
employee, manager, or owner. Management participates in employee development and
nurturance by sharing responsibility and power with workers and allowing them to be creative
and manage themselves. The CEO strongly believes that employees and customers must be
treated as human beings, not numbers.

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