How Teams Drive Strategy

At the turn of the century, organizational science expert Margaret Wheatley observed the basic human impulse behind organizing: “to accomplish something important that we could not accomplish alone.” When it comes to executing strategy, teams exist for just that reason. However, aligning teams around a shared vision represents one of the most difficult organizational challenges in modern times. Why? Teams drive effective strategy.

So, why are teams such a critical ingredient? As long as a firm has talented individuals, shouldn’t that be enough? Based on an analysis of 14 years of investments at Storm Ventures, Silicon Valley investor Jason Lemkin noted that failed startups all had one thing in common: “Problems in the team.” Lemkin called out several examples, “Co-founders that couldn't work together.  Co-founders that didn't agree, not really, on the strategy. Even if the individuals were great, even if there were early happy customers in a great market ... the initial crew just wasn't a great team.”

The problem extends far beyond Silicon Valley. For decades, management thought leaders such as W. Edwards Deming have observed the critical importance of team dynamics relative to individual talent. According to his “85/15” principle, Deming claimed that workers are responsible for organizational failures only 15% of the time, whereas management and ineffective systems are to blame for the other 85%. Even “star” performers on Wall Street aren’t always so remarkable upon examination. In his book, Chasing Stars: The Myth of Talent and the Portability of Performance, Harvard professor Boris Groysberg unpacks the careers of thousands of “star” performers on Wall Street, only to discover that their performance often dipped once they left their teams. Just like W. Edwards Deming, Groysberg found that performance is determined largely by teams and institutions, rather than individual talent.

How can managers can align teams around strategy?

Given the importance of teams in implementing a shared strategy, intentionality in communicating with and coordinating team members is key. As managers play an enormous role in shaping team performance, Google studied the top eight “manager behaviors” that correlate most with high performing managers.

According to Google, the top eight traits of a great manager include:

  1. Is a good coach

  2. Empowers team and does not micromanage

  3. Expresses concern/interest for team members’ success and personal well-being

  4. Is productive and results-oriented

  5. Is a good communicator

  6. Helps with career development

  7. Has a clear vision/strategy for the team

  8. Has important technical skills that help him/her advise the team

Of these eight behaviors, you’ll notice that two of them—“is a good communicator” and “has a clear vision/strategy for the team”—are critical to setting and communicating team strategy. Given this observation, Google also had advice for managers on how best to develop a team vision, specifically by defining the following:

  • Core values, which are the team values that, in turn, form the foundation for team purpose and mission

  • Purpose, which is the reason why the team exists and how it impacts the organization

  • Mission, which describes the bigger picture of what the team is trying to accomplish

  • Strategy, which is how the team plans to achieve its mission

  • Goals, which are objective benchmarks that measure how well the team is meeting the objectives of its strategy

Collectively, values, purpose, mission, strategy and goals make up the team vision and serve as an anchor to drive team performance.

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Here at Artemis, we believe strongly in the power of teams over individuals—especially when executing strategy. Given the results that we have seen among our own teams and clients, companies can realize sustainable competitive advantage by aligning teams effectively around a shared vision and goal. In short, invest as much in your teams as you would in your top-performing individuals. After all, teams are the most vivid way that organizational culture, norms, and expectations—including those around organizational strategy—come to life for the average employee.