MIT Sloan Management Review: John, we talked to you about 18 months ago. Is there anything new in your research that you’re particularly excited about?
John Hagel: We just completed a major research initiative around business practice redesign, but the whole focus was a bit contrarian. For several decades, the whole thrust in the business world has been around business process reengineering. Our view is that processes are increasingly becoming prisons and the key to accelerating learning and performance improvement is actually at the level of small frontline work groups that are confronting new situations. We did a series of case studies around work groups that are accelerating their performance improvement and identified nine practices that seem to be contributing to that acceleration.
Do you see companies moving toward a work group structure as opposed to the traditional command-and-control hierarchies?
We call the work groups the invisible part of the organization. Companies are relentless in tracking performance at the level of individuals and of departments. Companies know work groups are out there, but when we asked them if they have any work groups that are accelerating performance improvement, we got kind of a blank stare: “Well, I’m not sure. We have work groups, but we don’t really know what performance improvement they’ve achieved and whether it’s accelerating or not because we don’t look at that.” It’s interesting that more and more of the performance at companies hinges on these frontline work groups, and yet they’re invisible.
Is there a difference between work groups and cross-functional teams? And if so, what is the distinction?
The way we defined a work group is a group of people who spend the vast bulk of their time together. They’re not just the team that meets once a week for a couple of hours to coordinate. And the work they do together is so intertwined that you can’t pull it apart and say, “You do this step first, you do this step second.” It’s not a process. It’s collaborating around addressing a particular problem or an opportunity that requires anywhere from three to 15 people.
Are they cross-functional? It depends. How broadly do you want to define cross-functional? Some of the work groups we looked at worked in maintenance at Southwest Airlines Co. They brought in people from other functions into the work group, but it was largely maintenance people.