As a UK recession looms, many boardrooms around the country are under significant pressure to continue ‘business as usual’. But whatever the reality of the impact of the changes in the world economy on the current revenue and profitability of the business, the boardroom is responsible for predicting change and planning for it. Business specialist William Buist delves into the world of the relationships between executives and the Board, exploring the meaning of team spirit, indentifying the warning signs to look out for and explaining why some tension in the team is actually a good thing!
The latest news suggests that the economy is now shrinking. Directors know they don’t have long and they need to be ready. The challenge then is how they operate as a team, not when things are going well, but when things are stressful, and when they are failing. The team spirit will be tested and if it’s not strong, it will begin to breakdown. Team spirit is a phrase used frequently in business but seldom is its meaning really understood and its potential harnessed.
What does team spirit mean?
It’s Esprit du Corp, the spirit of the body (of people) that allows the group to act in a common way, protecting each other and looking out for and helping where it’s needed to get the results that the team wants.
When it is strong the team is strong and when people ask members of the team a question they get a consistent answer. The team works on most things collaboratively and mistakes get resolved without rancour.
When it is weak there is loss of clarity. The team works on many things, few of them in a collaborative way, and the resulting mistakes simply annoy and cause more tension between the team.
What creates team spirit?
A key aspect of team spirit is common purpose. When the board has a clear vision which all of the members support, then they have a common understanding of the direction the business needs to take.
When their own goals and ambitions as individuals are also aligned to those goals then the passion of the individual to achieve their own aims brings results for the business too.
Is that always a good thing?
High team spirit is often associated with an over optimistic expectation evaluation of the impact of risk (it won’t be as bad as it could be) and unrealistic assessment of the likelihood risks arising in the first place. Risk Management requires a focus on the negative, and great team spirit focuses on the positive.
One problem that can arise is that if the Board is too aligned, they might stop asking questions about the goals of the business, mainly because strong team spirit can lead to ‘group think’ and loss of challenge. When external change arises it’s sometimes missed because the common purpose and team spirit means the focus is on delivering what is needed, rather than managing risk.
There is a big risk for good corporate governance in that too, because governance is closely related to risk management…
But the converse isn’t much better either. A focus on risk management becomes paralysing to delivery as members of a board have little or no team spirit as here people see risk in everything and are keen to get their defence in first.
As each member looks out for their own interests they tend not to see risks materialising in other areas and so fail to provide the support the other directors need, when they need it. Each member focuses on their own needs and whilst they might seek to do things that do advance the business, they are likely to focus on different parts of the company vision. The impression left is of far too many projects pulling resources in very different ways.
What should the Chief Executives do?
Clearly the balance of team spirit is important, too much and there are risks of “group think” and over enthusiastic focus on delivery and loss of focus on governance and challenge. Too little and there are risks of stagnation and focus on divisional rather than corporate goals.
The need for some friction, allied to great team spirit means that Chief Executives need to be able to improve the common, shared spirit within the group, whilst also leading through a time of friction. It’s hard, or impossible, for one person to both lead people on a common journey, and provide the friction that keeps challenge levels sufficiently high.
If team spirit is too low, then the causes of that need to be identified. Team spirit is strongest when all the relationships between the individuals in the team are strong and build on foundations of mutual appreciation from knowing each other well, liking each other and trusting each other.
The Chief Executive or the Chairman can facilitate those relationships over time by understanding the individuals well, by listening to their concerns and acting to lubricate the interactions between members. Their clear understanding of the overall vision and goals of the business mean that, as leaders of the group, they can develop common goals with the individuals. Matchmaking the help each team member needs and creating an environment in which they can perform, and be seen to perform, means that working together is more effective than working alone. Synergy is a watchword.
If team spirit and collaboration is strong, then tension and friction can be developed through creating additional competition in to the team, through extending targets and goals, extending and changing the vision, or through the introduction of external influences and external audits and consultancy. Independence provides a review that can check that risk management and corporate governance are properly undertaken and protects the organisation from a loss of team spirit, there is, after all an external agent in the issues under review.
In many ways the key role of the leaders of an organisation can be summed up as the responsibility to ensure that the senior team has great team spirit allied to sufficient challenge and review to ensure they focus on the right things at the right time. It’s a fine balance and one that can be disturbed by many things, the skilled leader works continually to keep the balance right.
William Buist is director of Abelard Management Services, a company which specialises in building trust in teams and communities. For more information visit www.abelard-uk.com
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