The Human Element: The Power of Teams

By Bob C. Kennedy
Principal, RCK Consulting

In the eighties there was an obsession in American manufacturing with all things Japanese. The Toyota production system was the new standard for mass production, bringing with it “Just in Time” (JIT) inventory management and a new passion for quality. When I was working at Westinghouse Electric at that time, the Japanese “way” was especially prominent. One of the practices that Westinghouse tried to adopt was called quality circles.

In short, quality circles represent teams of employees in a team-based effort to solicit input from the workforce. The teams meet regularly to solve workplace problems and improve overall production. They were designed to promote a culture of continuous improvement. The practice also suggested that a by-product of the efforts would be a better relationship between management and the workforce. This was an important driver at the Beaver, PA plant where I worked, as the relationship between the IBEW and Westinghouse at the time was not great. 

I was not a direct participant, but I watched and learned. I thought quality circles were such a great idea, because even as a 20-something industrial engineer, it was clear to me that the union guys had a tremendous store of knowledge that management would benefit from. In the end, as I recall, the effort to employ quality circles did not work to any significant degree. Perhaps the animosity between the union and management was too great. The technique was also deployed at a time when Westinghouse was moving production to Puerto Rico and the distribution center to South Carolina. All of those jobs went with it.

In any event, the concept stayed with me. Through the years, team organization came naturally to the service organizations where I worked managing teams implementing WMS projects. The easy part was getting our own staff to work as a team. The trickier part was integrating our team with the customer and working cohesively as one. When we achieved that, more than likely we had a successful project. Perhaps more importantly, when you had that sense of team with the customer, your inevitable mistakes were tolerated or even supported. 

Building successful teams

I write and talk a lot about teams. Lately, what fascinates me is the opportunity to organize a workforce into teams and foster a team culture that realizes the potential of the Human Element. When there is a strong team in place, a different dynamic takes place:

1. The team works for the benefit of the team, not just themselves.

2. The overall performance improves, as team members become synergistic.

3. The attitude of the workforce improves, as bonds develop among the personalities.

4. Efficiencies naturally develop, as the team finds its own way of doing things; of deciding who is best at doing what.

There is evidence to back this up. The research generally supports that quality circles can improve workforce efficiency, productivity, and innovation. I would like to think that these improvements are the result of positive team reinforcement, but undoubtedly there is also an element of peer pressure at play. That’s natural, and it’s not a bad thing.

Furthermore, several studies have examined the impact of quality circles on employees and suggest that participation can lead to improved job satisfaction and organizational commitment, which are key factors influencing employee retention. Even with all these benefits, I think the potential of team structures is underappreciated and underutilized even today.

Real-world examples

So how do you organize your workforce and structure your team to achieve this ideal dynamic? I suppose there are lots of ways. I think, though, as a core element, the team should be defined by workers who are dependent on each other. That is, where your process flow moves work from one set of people to another. This is where a team that wants to succeed together will flourish.     

As an example, moving newly arrived receipts into inventory will require the cooperation of at least:

1. A lift driver to unload and stage

2. A receiving person and/or quality inspection person to verify the receipt

3. A second lift driver to move the ready receipts into storage   

If any one of those workers are not responsive, the inventory sits on the dock, leading to delays and backorders or short picks. All three of these people share a common stake with the others. Most operations use a metric for how long it takes to get inventory into storage. Those numbers will almost certainly improve if the stake is shared. 

Maybe the best example is the process of picking an order and moving it through packing. Here, you need at least:

1. A picker to initiate the order and start the pick 

2. A follow-on picker(s) to continue and complete the picks

3. A lift driver to manage replenishments to the pick locations

4. A packer who will complete the order, and ensure labeling and closure

There will also likely be a person responsible for managing inventory and doing counts. 

In this case, imagine those 4-5 people recognizing themselves as a team, with responsibility for the whole set of tasks, not just their individual tasks. What comes with that is the realization that what you do impacts not just the next person but the whole team. When you put in that extra care, and your teammates do as well, the whole team improves. 

Incentive pay and team-based metrics

Moving from individual-based tasks to teams presents the question of incentive pay. You may want to consider restructuring incentive pay from the individual to the team. That could be a tough thing to do depending on current agreements. Short of that, it is an easy thing to add other incentives for the team based on the same metrics. Simple, inexpensive incentives like lunches and gift cards go a long way to fostering cooperation.

There is extensive research on the effects of a team-based workforce and quality circles. The vast majority speaks to the benefits toward performance, work life balance and retention. Again, nothing new here, but perhaps applied today, this  proven method can add improvements, quickly, and inexpensively. 

I would love to hear how people are using teams in a similar manner and how effective those programs are. I would also love to sit down with anyone intrigued by the concept and help them design a program.