Getting the Most from Management Teams

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Which CEOs are best at creating teams?

A wonderful example is General Electric (GE). In last year's letter to shareholders, Jeff Immelt talked about major investments GE is committed to making in building team-based performance. Google (GOOG) is another example of an organization oriented toward doing things in teams.

Who doesn't have well-functioning management teams?

You've got to be cautious about saying whether companies you see in the press have a good senior management team or not. Can you say that the reason leaders of major Wall Street firms lost their jobs was because of ineffective team performance? You can't say that. You can have people at the top of an organization who play well together, but in effect they are fiddling while Rome burns.

What specifically should CEOs do to build the best teamwork?

The first step might seem paradoxical, but it is to ask: "What am I good at when it comes to leading this team?" Every coach in the sports world would start this way. Are you good at fostering robust conversation and getting conflict out on the table? Are you good at the selection of people? If you can't do something, get it done through others.

Step Two is understanding the right structures and processes. What I mean by structures are the composition of the team, definition of roles, decision rights, and rewards that shape individual behavior in a team context. Processes are how you manage conflict and the mechanics of managing a meeting. How do we operate together interpersonally?

What's the average size of these management teams?

Over the years in the literature about teams, people have wondered what the right size is. Our research found that's not really a meaningful line of inquiry. People said it was irrelevant. I've seen six-, eight-, and dozen-person teams. Size is far less important than being sure you've got the right people and that you've got diversity in terms of skill and opinion.

Diversity helps make better decisions?

Yes, diverse teams are generally better. There is a more balanced consideration of different perspectives, and I'm using the word "diversity" in the broadest sense—diversity of personality, of opinion, of decision-making style.

The caveat is that when teams are in crisis and their business is in crisis, and you need a monocular focus on an issue or two, diversity in opinion and decision-making can get in the way of moving quickly.

If CEOs are sometimes captive to their senior management teams, should they simply end-run their own teams?

The best CEOs are always engaged at the ground level. It doesn't necessarily mean you're working at the call center or checking in regularly with first-line supervisors. It means you're engaged in making the business happen in a granular way. The best CEOs are never without dirt under their fingernails. The goal is not to do an end run on their team but to work toward one of the requirements of being a CEO, which is to have a perspective on the distant future, not just today.

How can CEOs create the right culture on these teams?

If you say something, mean it. To get the best out of your people, you have to establish directness and candor. Then you have to put together a process that makes that happen. You have to understand how to make real conversations happen—and if you don't understand how to do that, get help.

Again, I ask, if a CEO can't communicate properly with his or her own team, shouldn't that CEO be fired? How can you tolerate a CEO who can't communicate?

You shouldn't tolerate a CEO who can't communicate. On the other hand, creating a high-performance team is about a lot more than just communicating. We all know people who give very good speeches and are very good in talking to the press. But they may still need help in creating a high-performance group.

Is this coaching work a growth business for Heidrick, moving you beyond the traditional business of recruiting and search?

It is. Finding top talent is Step One. But giving the talent assistance in performing is the adjacent space to our traditional business. We're deeply involved in helping CEOs think about what they're seeing and not seeing, and in helping high-performance teams. It's still all about talent.

Holstein is an independent business journalist and author in New York.