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An important executive goal in most large companies is to improve efficiency and effectiveness. With top-line revenue growth elusive in most markets, a key way to increase returns to shareholders is to boost the bottom line — and that means stepping up productivity. These gains need to come from improving the processes that run the company as well as those that change it.
Unfortunately, achieving greater productivity in project teams focused on change can be challenging, especially when new technology is involved. Every company has experienced a project that was either delivered at twice the budget and in double the time, or never actually delivered against its objectives and eventually scrapped. There are many reasons why these large programs fail, but one potential root cause is that they simply break down under their own weight. One way to improve the effectiveness of projects is to reduce the size of the teams mobilized to tackle them. In other words, it might be time to make your project teams smaller.
Smaller teams move faster, iterate at a higher frequency, and innovate more for the company. There are endless examples of small teams achieving amazing things. When Facebook purchased WhatsApp for $19 billion, the company’s 32 engineers had created a platform that was used by 450 million users. The Volkswagen Golf GTI, one of the most famous hot hatchbacks in history, was created by a team of eight. Many of the largest technology companies created their first successful products with teams of fewer than 10 people.
Jeff Bezos famously instituted a “two-pizza rule” in the early days of Amazon. His edict was that any team that could not be fed by two pizzas was too big. In concept, it is fairly easy to understand how a smaller team can be more effective, as communication is easier and decision-making can be accomplished more quickly.
But practically, how can managers take advantage of this technique in large organizations?
Make Big Problems Smaller Problems
Establishing two-pizza teams is especially challenging with in-flight programs in large organizations that tend to grow over time. If you track the scope of a major change initiative, you’ll often find that by the end of the project, the goals of the program bear little resemblance to those that were agreed on at the beginning.