How Effective is working Teams.
How Effective is working Teams
Team-based working systems are sparking off a revolution on the shop floor. Team work and its effects in Strategic and operational processes in Organisations.
WIDGET India is learning a new lesson: Togetherness Enhanturing Systems. More succinctly, the doctrine of WORKING TEAMS is sweeping away the mindless routine of shop floors in corporate’s across the country. By bringing together workers, supervisors, and managers from different disciplines and organizing them as small teams, corporate India is radically tinkering with its manufacturing processes.
As a result, factories are turning into team-based entities. And these teams are creating a revolution on the shop floor: cutting costs, improving quality, boosting productivity, catalyzing innovations and bettering worker-manager relations at almost all manufacturing giants in the country.
Spurring this metamorphosis is competition, since firms are being forced to redefine the rules as they whip up performance and shave costs. No longer is manufacturing best done by breaking a process down to its smallest, repeatable component, as the Industrial Revolution lay down. Successive technological revolutions since then have transformed production processes in almost every industry, smokestack or green.
Nor are workers best employed as cogs in the giant manufacturing gearshift any more; educated and skilled, they can be vital resources in the value chain if properly managed. Increasingly, companies are beginning to realize that clubbed into shall work groups, workers can be far more productive than the sum of their individual initiatives. Motivated teams exotically labeled Kshitij, Avishkar, Alpha, Delta and X-14 FA are revolutionizing the workplace today.
At Philips India, employees are regarded as collaborators. Says CEO H.J.J. Rensma, 64: ¨I would like to do away with the distinction between workers and managers〃. Adds Hari Rao, vice-president in charge of manufacturing, Titan Industries: ¨Worker is too restrictive a term for today's employee. It implies someone from whom you buy just muscle power〃. Says IFB Industries CEO Bijon Nag, 51, who shares letters from customers demanding price cuts with his workers: ¨The days of assembly-line production are over〃. Instead, firms are trading traditional tasks for team empowerment and winning.
Modi Xerox was one of the first corporates to kick off the team movement, setting up six continuous quality improvement teams four years ago. That number had gone up to 28 by last year. Now, team-formation is so structured at Modi Xerox that the company has a Blue Book, which defines the areas that cross-functional teams can address.
Impressed by a visit to the production facilities to Japanese manufacturing giants Toshiba and Hitachi, Videocon International direct Pradip Dhoot, 32, has instituted radical changes in his shop floor. At the company’s plant at Aurangabad (Maharashtra), workers have been divided into four independent business units, which compete with each other in attaining targets.
The most common, and closest, ancestor of the team in the factory is the quality circle. While TISCO has set up close to 100 quality circles, TELCO has about 2,000 quality circles in Jamshedpur (Bihar) alone. In addition, both organize several small group activities on the shop floor.
Elevator giant Otis, which started with a few pilot quality circles in 1991, now has 10 quality teams. After hiring teams consultant to talk to employees, Otis sponsored leadership and facilitator courses, as well as programmes in group relations, to ensure that it was adequately prepared to form teams.
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Voltas uses cross-functional teams as part of its quality control systems. And as the concept catches on, companies are sharing data. While Philips is borrowing concepts and ideas from Hindustan Lever’s use of teams for logistics management, successful Philips teams have made presentations to workers at Chloride India and INDAL.
Six months ago, pharmaceuticals giant Ranbaxy Laboratories introduced cross-functional task forces to work on priority areas like new product development, succession planning, waste management, career planning and maintenance; it now has 21 such teams. In line with the company’s top-down approach, these teams are made up of managers and supervisory staff. Eventually, they will embrace workers as well.
Call them effective working groups, performance cadres, task forces, quality circles or what you will, but the fact remains that teams are simple concepts. Too much s+o, in fact. Distressingly, CEOS regard their organizations as groups of individuals on the same side; in other words, one big happy team. Be warned: such teams don’t necessarily mean teamwork.
Real teams are manageablewith typically between two and 20 membersand highly motivated. More importantly, team members are committed to a common goal, be it controlling defects or cutting costs. According to Jon R. Katzenbach and Douglas K. Smith, consultants at McKinsey & Co., who co-authored The Wisdom of Teams: ¨A team is a small number of people with complementary skills, who are committed to a common purpose, performance goals and approach for which they hold themselves mutually accountable〃.
Take Cadbury India, which sets annual targets for savings, efficiency, and cost control. Once the bottlenecks in achieving these goals are identified, eight-member teams are set up to try and solve them. Drawn from various departments, members also include managers, who need not be the team leaders.
Functionally, teams operate better by choosing an internal coordinator rather than a whipster; the best teams are self-directed. Moreover, successful teams work in a closed-loop formation that allows them to meet their goal quickly, disband, and re-form as a new team to attain a new goal. Not surprisingly, horizontal organizations are axiomatic with team-led management. Says Modi Xerox CEO B.K. Modi, 44: ¨The whole foundation of teamwork is based on inculcating a spirit of oneness irrespective of organizational hierarchy〃.
Most firms have more than one kind of team: teams that run things, teams that recommend and teams that make or do things. But these are not watertight compartments, but contiguous circles. Quality improvement circles, for instance, are segregated from small-group activities in firms where both sorts of teams exist. But they are also related in some fashion, since quality teams can achieve quantum jumps in productivity only by evolving new processes.
For example, Philips has identified 28 areasbroadly classified as quality, costs, and deliverywhere the company feels it needs major process break-thoughts. These problems have been entrusted to quality teams which function as a layer on top of small group activities.
At first, a small group was constituted to bring down the faults in the soldering process from 1,200 to 200. By the time the number of faults was reduced to 700, the team realized that a design-level change would be needed if it was to be brought down even more. That’s when Philips decided to set up a quality team. Says A.M. Mishra, divisional manager (foundries department, TISCO: ¨The essence of quality circles is that two heads are better than one
There is also certain progression in the usage of teams. While the natural first step is the creation of problem-solving teams, next comes the deliberate organization of semi-autonomous work unit teams. And tomorrow, that will result in the creation of self-managing teams, which will take over and manage the daily business of an organization.
To be truly effective, teams must have few boundaries. Complementary skills are important and there should be few entry-barriers. For instance, Voltas constitutes teams to analyze malfunctions in its air-conditioners and to relay the data to the production department. Such teams include the service mechanic who handled the complaint at the customer site, representatives from sales, manufacturing, the quality department that inspected the air-conditioner and the engineering department which had designed the product.
Normally, the nature of the project dictates the composition of a team. When Akash Khandelwal, Modi Xerox’s site-service maintenance manager, began a project on energy conservation, he put together a multi-functional team with representatives from various department as an external agency, which performed the initial energy audit. The team worked for 12 months to get the conservation message across. Year-end savings: Rs 1,000,000/-.
Despite employee empowerment, successful teams’ don’t just happen. One precondition for success is that top management must be responsivethrough feedback, training and recognitionto team efforts. Philip’s small group activities are part of a structured training programme, where participants attend sessions on statistical modules, diagnostics and remedial action. In addition, the firm also runs training programmes called Human Relations at Work, where groups of 25 participants including managers, executives, helpers and workers play team games with the objective of winning by collaborating.
The trick really lies in a subtle change in leadership style. Managers must provide strong direction in the early stages of team building and slowly move to a stage where they become mere members. Earlier, Philips had small groups and management groups but dissolved the distinction so that groups could have a mix of operators and managers. Says Subroto Sengupta, industries manager, who heads Philps’ Calcutta plant: ¨There has to be very visible top management involvement〃.
Three years ago. TISCO’s forging division decided that each manager must be involved in a team. Says CEO J.J. Irani, 54: ¨The existence of a collaborative and positive relationship between workers and managers is important for the success of quality circles〃. At Ranbaxy, a steering committee headed by CEO Parvinder Singh, 49 provides constant feedback and value-addition based on presentations by each of the teams.
Pitch forking team spirit in companies is the age-old lure of a free market: profit. At Philips, the genesis of teams dates back to 1988, when the company posted a whopping loss of Rs 70,000,000/- most of it because of a new factory at Salt Lake, a Calcutta suburb. Two major problems were identified: a lack of communications between employees and the excessive secrecy around sales plans and production figures.
So, the management started suggestion schemes and small group activities for good housekeeping and route rationalization of the company’s transportation service. And team-based production systems have paid off: colour television production at Salt Lake went up from 4,000 per month in April 1993 to 12,000 in April 1994 even as manpower per person three-fold.
Critically, the plant’s ability switch to the production of new models improved dramatically. Selected teams can be trained to switch to manufacturing new models without the entire assembly line having to be restructured, as was essential in the earlier linear system.
At Titan, an eight-member team was set up to improve productivity through workplace redesign. After two years of studying workplace ergonomics, the team suggested changes such as special cavities in the workplace to ensure that components were not dislocated when they were being used, special axle-holders for easy pick-up, raising the workplace height by 10 cm for a more comfortable posture and cushioned armrests to reduce arm-fatigue. The net impact: cycle times at Titan came down by nearly 180 per cent, while the maximum production per shift rose from 1,346 to 3,773 watch components.
Quite often, a team may be set up as a preparatory exercise to a larger corporate plan. Take the Navjyoti team at Modi Xerox, which has been assigned the task of re-laying the assembly line to ensure that the parts arriving from stores, or internal suppliers, reach user-stations faster. Over the next six months, the industrial engineering and shop floor team expects net productivity to improve by 20 per cent. In addition, the re-layout will be first phase of a planned shift to the just-in-time production of photocopiers.
Similarly, the 21 teams at Ranbaxy have multi-functional interfaces between departments: human resources development and manufacturing, R&D and manufacturing, marketing and manufacturing. The company even sought assistance from Qimpro Consultants, Eicher Consultancy and Ten-nessee Valley Associates to dovetail its teams with corporate priorities.
Not surprisingly, team-formation cements industrial relations. Philips’ small group activities, for one, started when industrial unrest was tearing apart its Pune (Maharashtra) plant. Says Sengupta: ¨Often, the only non-controversial thing is quality. SO, you begin by trying to address that through groups〃.
While the decision to form employee involvement working teams makes competitive sense, workers may decide to set up a team when they discover that poor raw material quality or machine limitations are affecting their incentive pay.
One team at Titan increased its productivity by replacing the earlier manual method of picking up watch parts and placing them on trays with an automatic-ejection system.
Buoyed by success, a team can soon trigger a reaction. When one team in the foundries department of TISCO doubled its bonus index by increasing its productivity, another 17 quality teams came up in the same division. Says a team member: ¨Now, there is competition to show higher productivity〃.
Hooked to the team bandwagon, firms find that there is intangible pay-offs too. Flap can be trimmed by cutting the number of supervisors, innovation is institutionalized, and job satisfaction rises. Says Modi: ¨The most significant achievement has been the involvement and enthusiasm of frontline people in resolving shop floor and field problems〃. Adds Videocon’s Dhoot: ¨It is up to the management to formulate systems such that workers enjoy their jobs〃.
The very act of brainstorming over cups of tea, or scrambling of finish duties 30 minutes earlier to get to a team meeting establishes a unique bond among team members. Says TISCO’s Irani: ¨By working together, the individual worker gets used to group activity〃. Companies are now nurturing team spirit through rewards. At TISCO, the best quality teams are recognized on World Quality Day. Modi Xerox headquarters in New York for a week, during which they compete against similar teams from around the world for the best team award.
Still, there are companies which are wary about the concept of teams. That’s partly because managers feel that their authority is threatened as they are reduced to the level of workers and supervisors. Their role changes to being a facilitator in the team environment: helping teams interact with other departments for inputs and equipment that needs financial backing. Says working teams expert Suresh Lulla, managing director, Qimpro Consultants: ¨The facilitator’s main role is to keep the team o track〃.
In their new role of catalyst, managers must learn to be responsible for training teams. Tough, but vital since most teams follow a structured methodology in their operation. The structured methodology in their operation. The starting points are the diagnostic elements by which the precise problem is identified. In the next stage, the problem statementcritical for a structured solutionis created. This is followed by brainstorming, problem validation and after filtration, the determination of the root cause.
As a matter of fact, human resource development consultant L.N. Ghirnekar, who is the chairman of the Quality Circle Forum of India, tests whether a management is ready for change. Is the union-management relationship cooperative or confrontational? Is the style of leadership dictatorial, participatory, or democratic? Says Ghirnekar: ¨The most important is willing to allow a more democratic style〃.
Over-expectations can, however, cripple team efforts. Even in their most radical avatar, self-managed workforces are not a panacea for all corporate curses. Says Ghirnekar: ¨You have to get the message across that the movement will not bring improvements in quality, productivity, or cost-cutting immediately. It will result in a more motivated workforce, which will bring in these changes over a longer period of time. Don’t expect miracles〃. Adds Arun N. Gokhlay, director (quality), Otis: ¨When industrial relations problems arise, the first casualty is quality circles〃.
In future, firms are bound to follow the global trend of creating team-based organizations. Says Irani: ¨As processes and equipment get modernized, which means that quality is built into the system, the role of quality circles will become more sophisticated〃. Agrees Ranbaxy’s Singh: ¨These small groups will give way to self-managing teams as the barriers of organization structure break down〃.
The secret of successful TEAMS: Trust them, empower them, Aim them, Measure them and Support them. For, in the ultimate analysis, teams can, and will, outperform individuals.