Small and lean organizations are the pinnacle of efficiency and powerhouse performance. Often times, the corporate giants are exalted for superior performance and considered the golden child of processes, results, and structures. When in fact, quite the opposite is reality at the micro level. The Ringelman effect argues that as group size increases, individual performance decreases. Therefore, the question remains, how does an entity remain efficient as staff size increases?
Enter social loafing. Social loafing occurs when there are numerous individuals working toward a goal and clear accountability measures are not in place making it easy to hide behind ambiguous roles and the accolades of others. For example, a financial firm must analyze the balance sheets of 100 companies and there are over twenty employees working on the analysis. Without clear accountability lines for each employee, all will think and expect that someone else will pick up the slack should one not “feel” like working for that day or not give 100%. Chances are, should that employee take a hiatus, such nefarious activities will have little impact on the aggregate performance.
This is why as organizations grow, it is essential to have functional teams that are barely sufficient to complete each task or milestone. Along with barely sufficient teams, comes the necessity of mutual accountability, an executing culture and goal adherence.
Barely sufficient teams does not mean inadequate teams, it simply means there is no glut in the amount of man power required to execute the task at hand. An explanation of the Ringelmann effect follows sourced from Wikipedia:
The Ringelmann effect is the tendency for individual members of a group to become increasingly less productive as the size of their group increases. This effect, discovered by French agricultural engineerMaximilien Ringelmann (1861–1931), illustrates the inverse relationship that exists between the size of a group and the magnitude of group members’ individual contribution to the completion of a task. While studying the relationship between process loss (i.e., reductions in performance effectiveness or efficiency) and group productivity, Ringelmann (1913) found that having group members work together on a task (e.g., pulling a rope) actually results in significantly less effort than when individual members are acting alone. Furthermore, Ringelmann discovered that as more and more people are added to a group, the group often becomes increasingly inefficient, ultimately violating the notion that group effort and team participation reliably leads to increased effort on behalf of the members.
In sum, organize the smallest functional team possible to execute a project without overburdening or stressing out the team.
-Justin A. Burger, MBA