Understanding Global Team Effectiveness In The Context Of Product Development
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Today's global economy requires many organizations to co-ordinate work across a variety of intra and inter-organizational boundaries (Armstrong & Cole, 1995; Lipnack & Stamps, 1997). Global competition, re-engineered product life cycles, mass customization, and the increased need to respond quickly to customer needs are just some of the more pronounced trends currently driving organizational change (Grenier & Metes, 1995; Miles & Snow, 1986; Miles & Snow, 1992). An organizations growth and profitability is largely due to the strategies of globalization. Firms developing products with global applications must build competencies to connect and leverage knowledge on a worldwide basis (Bartlett and Ghoshal, 1998). In several industries product development is a crucial ingredient and therefore factors such as cost of development, cycle time and increased productivity are key drivers for market share and profitability. Product development is an expensive process particularly in the engineering and technology intensive segments. Technological advances have enabled many companies to assemble teams of employees from across the country or around the world into global teams to solve complex organizational problems (Lipnack and Stamps, 1997). Such teams are sometimes temporary, culturally diverse, geographically dispersed, and electronically communicating collections of individuals (Kristof, Brown, Sims, and Smith, 1995). These teams allow organizations to increase efficiency and effectiveness by tapping the knowledge, skills, and expertise of employees around the globe, increasing opportunities for information or knowledge exchange through expanded social networks (Wellman 1996). A large amount of investment is spent in human resources and hence ways to optimize the spending by leveraging global resources, directly helps the bottom line (Govindarajan & Gupta 2001). Models that could be used to understand better team development and effectiveness have been limited to those based on the traditional colocated group perspective. Theory development and empirical research are needed to help managers better understand and respond to the challenges that global teams face (Furst, Blackburn & Rosen, 1999). A literature review conducted found though team effectiveness has been fairly well researched the extension of the topic and as applied to global teams remains a gap. This study attempts to understand team effectiveness and its relevance when applied to a global team in a product development environment. The study involves developing a suitable model and understanding the causal relationships between the identified factors and explains the model based on the findings. Review of Literature The study reviewed a vast amount of literature relating to teams and small workgroups and summarized findings under; Team Definition, Team Types and Nature, Team Composition, Task Design, Team Development, Team Processes, Organizational Context and Global Teams. The literary review suggests that though research is steadily increasing, empirical studies on performance and effectiveness are limited. There has been very few studies on effectiveness as applied to global teams. Literature review on the subject of global teams, suggests that these teams, face even greater challenges because of their geographical separation, diverse cultures, and language. The study identified factors as applicable to global team effectiveness based on previous studies and calibrates them with findings in general team and workgroup study. The study considers Task design, Team composition, and Organizational context factors and attempts to empirically determine causal relationships with Team Processes and Team Effectiveness. Objectives and Methodology The objectives of the study are as follows: 1 To develop and validate a conceptual model that explains global team effectiveness in a product development environment. 2 To establish relationship between team design, team composition, knowledge management context and senior management context towards global team effectiveness in a product development environment. 3 To illustrate the application of the validated model and relationships for developing interventions to enhance effectiveness in a product development environment through a qualitative case study. The methodology adopted was to study contemporary team effectiveness models from literature and get an understanding of the key variables and factors that influence effectiveness. Next, based on prior studies on global teams, a model was developed using an established effectiveness model and extended it to global teams. The main study comprised of analyzing responses from 376 participants from 64 projects working together as global teams. The conceptual model developed consists of two key factors measuring effectiveness namely; Product Development Effectiveness and Team Process Effectiveness. The enabling factors, that are called as ‘global factors’ in the study that influence effectiveness in the model are; Team Design and Composition, Senior Management Context and Knowledge Management Context. Measures defining each factor were developed, refined and checked for reliability and validity. The factor analysis conducted suggested that Product development effectiveness variables include; Schedule compliance, Functional completeness, Product Quality, Cost compliance and Innovative Problem solving. Team Process effectiveness includes; Internal motivation in the team, Looking forward to team challenges, Willingness to share Knowledge, Conflict resolution, Openness to Learning and Quality team interaction. Similarly, factor analysis suggests Task design and team composition be combined as Team Design and Composition. The variables included are; Clear Goals, Well defined output or deliverable, Use of Judgment, Adequate skill sets (Technical, Functional, Program Management and Diversity) and Right size. Knowledge Management Context variables following factor analysis are; Knowledge management practice, Perceived importance of knowledge management, adequate infrastructure and Existent reward system. Senior Management context variables are; Global Senior management support, Management review support and Easy information flow. In order to achieve the objectives of the study a detailed Structural Equation Modeling using Partial Least Squares method was conducted. The measurement model and structural model was assessed, path coefficients studied, moderating effects studied and model evaluated for goodness of fit. In addition, an in depth case study is conducted and the model is applied in a practical scenario. Results and Discussion The study suggests the importance of global teams in a product development environment. This is particularly so as distance, time, culture and technology interface make it all the more important for global teams to have means of measuring effectiveness. It is also necessary to have an understanding of the enabling factors aiding effectiveness. The study suggests a model for measuring effectiveness in global teams involved in product development as; Meeting milestones and timely delivery of the output, Meeting product functional and technical requirements, Quality of output delivered, Cost and budget targets and Innovative problem solving are typical measurements of effectiveness. The model encourages using Team Process Effectiveness as a measure and suggests it has a moderating influence it has on Product Development Effectiveness. The Team Process Effectiveness measures are; Internal motivation amongst members within the team, Identifying if the team looks forward to challenges, Willingness to share knowledge with each other, Resolving conflicts within the team in a positive manner, Openness to learning and Quality team interaction. The model developed indicates that all paths defined and relationships are positive and the model is structurally valid. As hypothesized, factors, Team Design and Composition, Knowledge Management Context and Senior Management Context has significant relationship with Team Process Effectiveness. Further, Team Process Effectiveness has positive causal relationship with Product Development Effectiveness. Knowledge Management Context and Senior Management Context have a significant and positive relationship with Team Process Effectiveness. The study confirms the moderating influence Team Process Effectiveness has on Team Design and Composition, Senior Management context, Knowledge Management Context with Product Development Effectiveness. The in depth case study on a department of 75 members of product development global teams provided the insight into the empirical analysis, strengthened it and helped understand several other aspects of global teams. Conclusion The study provided an in-depth understanding of global team effectiveness by reviewing literature and identifying variables that influence global teams in a product development environment. A model was developed, empirically validated and tested. The model includes effectiveness factors and enabling factors and relationship between factors have been explained. A case study spanning a period of five years on a global team involved in product development was conducted and the model applied in practice. This study suggests that the model can be used by organizations and practicing managers for understanding, developing and leading global teams involved in product development.
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