CHAPTER 1

HOW TO CREATE A HIGH-PERFORMANCE TEAM

As a teenager, John Amaechi was, in his words, an ‘uncoordinated, hugely overweight nerd with Coke-bottle glasses and no friends’. Then, when he was 17, two sports scouts stopped him in the street in North West England and asked him whether he’d ever thought of playing basketball. Because, for all John’s self-described deficiencies, brutally laid out in his memoir Man in the Middle, he was also enormously tall. Within a few years, John was a star player in the US National Basketball Association league.

John’s journey is an extraordinary one. Born in Boston, Massachusetts to an English mother and Nigerian father, he came to the UK as a child when his parents’ marriage broke up. His mother, a doctor, brought John and his two sisters up on her own. Unpopular and ungainly, John sought refuge in books, but his sudden discovery of basketball changed his life. ­Overcoming a serious hand injury, sustained during a school trip, and fired up by his mother’s insistence that he lay out his life’s plans, he not only made it to the top of one of the world’s greatest sports leagues; he went on to become an in-demand organisational psychologist. So, John is an obvious person to listen to when it comes to examining what makes for a successful team – how you form one and how you lead it.

A team, John says, is a promise – a promise to work together and to get something done. John told a meeting of FT Forums, the Financial Times’s collection of business networking communities whose gatherings provide much of the material in this book: ‘It’s a promise of a different type of relationship with your peers, with your colleagues.’

Who to have around you and how to motivate them have always lain at the heart of leadership, but never more so than during the Great Disruption, the Covid-19 crisis that emptied offices around the world and led to a surge in home working. Leaders could no longer lead by having all their underlings sitting at desks around them, watching who seemed busy and who was slacking off, what time people came in and how late they stayed. Leadership became what those in the know always knew it was: the ability to inspire people without standing over them.

Of all the issues we will discuss in this book – from how to handle corporate crises to what we can learn from startups to ways to deal with artificial intelligence – how to create and lead a team lies at the centre. A group of individuals, however talented, can achieve little unless they know how to cooperate with each other and unless they are well led. That is as true in business or the public sector as it is in basketball. Without effective teams, there are no successful organisations.

So, let’s begin at the beginning.

WHAT MAKES FOR A SUCCESSFUL TEAM?

To John Amaechi, a team is not just a group of people thrown together. When it works well, a team provides more than its members’ job descriptions. The team knows what to aim for and how to get there.

But that begs a question: how does the team know what to aim for? A simple response might be that their boss tells them their goals. But whether they can achieve those goals, or even want to achieve them, depends on something more basic: knowing what the organisation is for, and believing in its purpose.

Elizabeth Jenkin is an experienced insurance industry executive. She has been an underwriter and held senior positions at Aon, the insurance broker, before becoming CEO of Nimbla, an online platform with an algorithm that assesses the probability of default by small businesses’ customers. Elizabeth, like John, also has some experience of the sports world – in her case, as an independent non-executive director of the Football Association, English football’s governing body.

To Elizabeth, a precondition of an effective team is that its members buy into the company’s purpose. ‘High-performance teams really understand and get behind their brand,’ she says. ‘They understand what they are working for. You can tell a high-performance team and a high-performance individual by the way they talk about their company.’

I understand from my own experience what Elizabeth means. In 34 years of working for the Financial Times as a reporter, columnist and senior editor, I always grasped what the FT stood for: accurate and independent journalism. The FT’s slogan is ‘without fear and without favour’. While the FT carries advertising, I knew, as both a writer and an editor, that advertisers would never be allowed to influence what I wrote or published. As journalists, our customers were the readers – and our promise to them was of fearless, independent and accurate journalism, regardless of commercial pressures. Independence matters to the FT; so do the facts. Getting something wrong is followed by an internal inquiry, and an embarrassing published correction. It was a humiliation I suffered only a handful of times – and I remember every one. The result of having such a clear ­mission was that I worked with a set of happy and purposeful teams – just as ­Elizabeth Jenkin would have forecast.

Of course, having a clear organisational goal is not a guarantee of commercial success. Jim Collins and Jerry Porras’s bestselling book Built to Last, first published in 1994, made much of the success of companies that had a mission that went beyond making money. But there was a problem: some of the companies praised in the book later struggled. Does that defeat Collins and Porras’s argument about the importance of purpose? No, businesses have their ups and downs. Technologies change; companies are outflanked. But without a purpose, no company gets to the top in the first place.

The John Lewis Partnership, the UK retailer that is one of the world’s most celebrated employee-owned enterprises, suffered during the coronavirus pandemic when much shopping went online. But anyone who has been inside one of its stores knows that Elizabeth’s point holds. You can feel the atmosphere in the shops; the John Lewis staff clearly work for the customer and for each other. They are called partners rather than employees. People notice. John Lewis scores consistently well in customer surveys.

The John Lewis partners are part of a tradition going back to 1929, when John Spedan Lewis, son of the founder, transferred ownership of the business into a trust for the employees, financed by an interest-free loan to be paid back out of future profits. Lewis thought staff worked best when they had a stake in the business and when they knew what the organisation stood for. Just as the FT stands for ‘without fear and without favour’, John Lewis has its stated mission: ‘The partnership’s ultimate purpose is the happiness of all its members through their worthwhile and satisfying employment in a successful business.’1

The coronavirus shut-downs and the subsequent move to more online shopping forced John Lewis to close several of its large stores and to plan a move into new areas such as social housing.2 But in 2020, the year of the coronavirus shut-down, YouGov, the polling organisation, rated John Lewis as the top UK brand for the fourth year in a row, based on issues such as quality, value, satisfaction and reputation.3 (In 2021, battered by the lockdown and announced store closures, John Lewis dropped to a still creditable fourth place in the YouGov survey.)4

Successful teams know what they need to do because their organisations know where they need to go. In a perilous business world, that may not be enough. But it’s the key to establishing a purposeful team.

LET YOUR TEAMS GET ON WITH IT

In 1960, Douglas McGregor, an American management professor, wrote a book called The Human Side of Enterprise. In it, he talked about two styles of management: Theory X and Theory Y. Theory X holds that employees are an indolent bunch and need, in McGregor’s words, to be ‘persuaded, rewarded, punished, controlled’. The average employee, in Theory X’s view, ‘lacks ambition, dislikes responsibility, prefers to be led’. Theory Y, on the other hand, says that employees want to do a good job, are inherently trustworthy and should be given the power to do their work. Theory Y is based on the conviction that, ‘The motivation, the potential for development, the capacity for assuming responsibility, the readiness to direct behaviour towards organisational goals are all present in people.’ The leader’s job is not to control workers but to create opportunities and provide guidance. Ultimately, McGregor wrote, the difference between Theory X and Theory Y is the difference between treating employees as children or mature adults.5 And the ‘mature adult’ approach to employees and teams, we can see, approximates to John Spedan Lewis’s – and John Amaechi and Elizabeth Jenkin’s – ideal of what we should be looking for in people and in teams.

McGregor’s book is not much remembered outside academic circles, but the two theories, Theory X and Theory Y, underlie much of modern-day thinking about leaders and leadership. You will come across plenty of leaders who say that their employees are their greatest asset and that they have every confidence their staff will always do the right thing. But many of those same managers end up practising Theory X: they don’t truly trust their people, they can’t bear to relinquish control over what they do and they aren’t happy unless they can actually see them doing it.

But the great home working exercise that began in 2020 blew Theory X and the controlling management style apart. With people working in their home offices, kitchens and bedrooms, bosses couldn’t monitor their every move. Of course, there were managers who tried. A YouGov poll in 2020 found that 20 per cent of companies were using or planning to use online software to monitor their home-working staff. But most trusted their staff to do their work without having someone peering over their shoulders. Sixty per cent of the managers questioned said that remote working had not made their staff any less compliant with company policies and 67 per cent said they hadn’t seen any rise in costly mistakes due to miscommunication.6 So, during the Covid-19 crisis, Douglas McGregor’s Theory Y became the norm, if only by default.

To John Amaechi, the bosses who say, ‘This is what I want you to do and this is how I want you to do it,’ are not leading a team; they are leading a ‘non-team’, a group of people who are there just because their boss has ordered them to be. What the boss of a true team says, according to John Amaechi, is: ‘I need this delivered on this date. How you do it, as long as it’s not totally disruptive to the entire organisation, is up to you.’ Theory Y, in other words.

Working that way requires leaders to have confidence in their teams. It also means that the organisational goals that Elizabeth Jenkin spoke about have to be clear and widely understood. The team needs to know the standards that the leader expects of them.

A leader who sets out a clear expectation of what the team needs to achieve, and then leaves them to decide how to get there, is also giving them a chance to grow and develop. A team that demonstrates that it can deliver what’s required without being monitored and watched develops the confidence to do it again – and begins to think of new ways of improving what it’s doing. It knows what to do without being constantly told. John Amaechi calls this process the team’s ‘earned autonomy’.

Leaders of successful teams focus on successful outcomes. They don’t fixate on the process, and their teams grow in confidence and initiative as a result.

JUDGING THE TEAM’S PERFORMANCE

Having set the objective, having seen the team achieve results (or not), how do you assess how well they have done? Do you have the heads of department preside over a yearly or twice-yearly performance appraisal of team members? Or do you conduct something more radical – a 360-degree appraisal, with each team member reviewed by their managers, peers and those who report to them?

Regular appraisals have been around for decades, but, in recent years, business leaders have started to question their usefulness. In 2015, Pierre Nanterme, then the CEO of Accenture, told The Washington Post: ‘We are not sure that spending all that time in performance management has been yielding such a great outcome.’7

Elizabeth Uviebinené, co-author of Slay In Your Lane, a guide for black British women, wrote in the FT in 2019 that end-of-year performance appraisals often left people ‘confused, blindsided or even surprised’ by how well they were, or were not, doing. The outcome of appraisals was bewildering and unpredictable: ‘For many of us, these dreaded annual reviews are characterised by anxiety, stress and – in some cases – relief.’8

John Amaechi is even blunter. ‘Appraisals are broken,’ he says. ‘They don’t work. They’re terrible.’

A 2016 article in the Harvard Business Review named a slew of companies that had abandoned regular performance reviews. They included top corporate names such as Adobe, Dell, Microsoft, IBM, Deloitte and PwC. The reasons for abandoning performance reviews included: they were backward looking. They reflected past performance rather than future potential. They were arbitrary. And, by concentrating on individual performance, they discouraged teamwork.9

Organisations’ appraisal processes are not always honest about what they are trying to do. They claim to recognise achievement but often don’t. As John Amaechi says, you may be an outstanding employee, but that may not be reflected in your appraisal because the company doesn’t want to pay you more. You may be original and interesting, but the appraisal’s categories may be too formulaic to reflect that.

Some managers give greater credence to 360-degree appraisals. Having been through a couple of 360-degree appraisals, I recognise their potential. They are an opportunity for those who work with you to tell you, anonymously, home truths they may be afraid to say to your face. But that is part of the problem. In my experience, it’s pretty plain who, in a 360-degree appraisal, has said what. If you know your colleagues well enough, you recognise their quirks of speech and writing, or you know that an incident they referred to is one only they could have known about. Eventually, people come to realise that you can guess who they are, so they begin to pull their punches when writing their answers to the questions. The supposed honesty in 360-degree appraisals disappears.

What is the alternative? Constant conversation and persistent feedback, rather than a formulaic exercise once or twice a year. A good leader chats regularly with team members, asks them how they’re getting on, what training and development they need – and lets them know when things are going wrong, rather than leaving it as an unpleasant surprise at appraisal time.

Elizabeth Uviebinené wrote of Millennial and Generation Z employees’ attitudes to appraisals: ‘We prefer real-time feedback throughout the year. We value ongoing conversations so that we can make frequent incremental adjustments.’ She said that this style of feedback ‘fits with our digital habits, which are driven by instant likes and comments on social media posts.’ But it’s not just younger employees who feel that way; most of us do.

The need for frequent feedback and discussion fits neatly with what we’ve said about the move to McGregor’s Theory Y. If you give your teams responsibility and ask them to achieve their goals without becoming overly controlling about how they get there, they respond with responsibility and initiative. You can then, without being overly controlling, keep up with what they’re doing. You provide regular feedback and ensure that you are open to discussing any problems they have. You keep a regular eye on their development needs. That way, you assure them, and yourself, that you recognise their taking of responsibility – what John Amaechi calls their ‘earned autonomy’.

LEADING A SCATTERED TEAM

At the height of the Covid-19 crisis, it became apparent that, for many companies, the Monday to Friday commute-into-the-office routine was over. In February 2021, an FT ring-around of 20 companies discovered that most envisaged staff coming back to the office on some days and not others. A PwC survey of its 22,000 UK employees found the majority wanted to be in the office no more than three or four days a week. ‘This will necessitate a fully hybrid model of working,’ Kevin Ellis, chair of PwC’s UK business, said. Chris O’Shea, the CEO of Centrica, the energy and services company, told the FT: ‘We won’t be back five days a week in the office and I certainly won’t.’10

The French bank Société Générale said it would allow its people to work at home for up to three days a week. Its CEO, Frédéric Oudéa, told the FT that flexible working would help to attract young talent who ‘don’t see the world in the same way they did just two years ago’.11

Not everyone feels the same. First, we need to remember that not everyone worked from home during the pandemic. Those essential workers who kept our societies going had no choice but to go into work, often putting themselves in danger of contracting Covid-19. There were the healthcare workers: doctors, nurses, hospitals porters and cleaners. They had to be on the front line. There were the supermarket delivery workers, shelf-stackers and cashiers, the street cleaners and bus drivers. They had no option but to do their work in the stores and on the roads.

And, even among some companies that had allowed staff to work from home, there was a sense that, after the pandemic, it was time to call an end to ‘work from anywhere’. David Solomon, the head of Goldman Sachs, said that while the investment bank had operated through 2020 with fewer than 10 per cent of staff in the office, ‘I do think for a business like ours, which is an innovative, collaborative apprenticeship culture, this is not ideal for us. And it’s not a new normal. It’s an aberration that we’re going to correct as soon as possible.’12

In Chapter 10, we will discuss in more detail the ways in which organisations can develop post-pandemic, and the balance between in-office and remote work. But we need to remember that the question of how to manage people who aren’t in the office isn’t new. There have long been team members who weren’t on-site: either because they were travelling for work or because, in widespread multinational companies, they were in different offices around the world.

Even before the pandemic, video conferencing was a way for scattered teams to talk. The FT, for example, is edited from three different global cities over a 24-hour cycle. The biggest concentration of editors is in London, but, as the UK evening draws to a close, editing responsibility passes to editors in New York and, when their day ends, the editors in Hong Kong take over – before passing responsibility back to London again. The London morning and afternoon news conferences, where story priorities are decided, are also handover events. The London morning conference would be attended, via video, by the editors in Hong Kong. The late afternoon London news conference would be attended, on-screen, by the editors in New York.

These sorts of video conferences became ubiquitous during the coronavirus crisis. Companies used Zoom, Google Meet, Microsoft Teams and other platforms to keep people connected. While these online conferences were essential, their limitations soon emerged. They were too impersonal. There was little chance for small talk before or after the call – for the old-style catch-up in the corridor outside or at the coffee machine. There weren’t the opportunities for a supplementary chat about something not quite concluded, or too personal to be brought up in front of everyone else.

What have we learned about the virtues and shortcomings of online and on-site meetings? Whether their teams are in the office or not, leaders need to make sure they speak to people directly – not just those who report to them but those lower down the hierarchy too. When people are in the office, stopping by someone’s desk to ask them how they are getting on or to thank them for a job well done generates a feeling of goodwill out of proportion to the time it takes to do it. And, when people are not in the office, it is even more important to stay in touch.

Even in the old days, when staff were always on site, many leaders didn’t make the effort to make personal contact. As John Amaechi put it, at the FT Forums meeting, leaders on the sixth floor often didn’t take the time to pass by the second. Getting up from your desk and wandering around is essential, showing that you are there, and appreciate those who have come in.

And for those employees who aren’t in the office, a phone call or an individual Zoom chat is better than an online group meeting. A personal email is fine, but as Elizabeth Jenkin says, it’s not enough. ‘Nothing is really a substitute for talking to that person and hearing the cadence of their voice and understanding what’s going on in their life today,’ she says.

What else can leaders do? Mentor, and encourage others to do the same. Whether in the office or not, mentoring of newer employees is a way of making sure they aren’t neglected, that they pick up the organisation’s way of doing things. Mentoring ensures an additional pair of eyes on people’s development and welfare. Loneliness, isolation and mental health problems were all downsides of the great homeworking exercise – and people can be lonely, isolated and have mental health problems even when they are in the office. Leaders need to keep an eye on whether people are coping – and mentors can help them do it.

In Elizabeth Jenkin’s own career, mentoring was ‘transformational’. But she says that mentors need to be selected carefully. ‘Make sure that you pair that person with the right person for them, someone who is going to develop them and who is not going to miss those calls,’ Elizabeth says. The mentors she’s had, Elizabeth says, have been her ‘safe space’ – helping her to understand her own strengths and vulnerabilities.

Something else leaders are going to have to manage in organisations where there’s no full-time return to the office is the generation of ideas, the innovations that provide new business opportunities. Having meetings on certain days, when all team members have to be in, is one way of generating those ideas. But other ideas come serendipitously, in unstructured conversations that take place when people are just chatting or hanging about.

With companies adopting a mix of home and office working, building an organisational culture, inducting new employees into the place and generating ideas are going to be more difficult. Organisations will make mistakes along the way. They may find they have the balance between in-office and remote working wrong. They will need to change.

What leaders need to focus on is talking, in as many ways as possible, in group gatherings and in one-to-one conversations. But the principle remains the same: set people goals and give them the independence to reach them. If that is not producing results, or new ideas dry up, you need to re-examine the mix of home and office working.

CREATING A DIVERSE TEAM – ONE THAT THINKS CREATIVELY

Diversity has become an organisational imperative – and rightly so. The imbalances that left women lagging in promotion, ethnic minorities under-represented and the disabled facing physical barriers to get into the building, let alone do their work, were unconscionable. Correcting those injustices was, and remains, an ethical obligation.

But team members who look like a diverse group may not be all that different from each other. I recall an FT colleague, who was about to appear on a panel, saying how she and her two fellow panellists were congratulating each other that they were all women – until they realised that all three of them had been at the same high-achieving school.

So, how do leaders achieve diversity? How do they build teams that reflect the places they live in and the societies they serve? An FT Forums online get-together on the subject took place while the world was still absorbing the killing of George Floyd, who was suffocated by a Minnesota police officer kneeling on his neck in 2020. George Floyd’s death was followed by Black Lives Matter protests in the USA and around the world, and company leaders being forced to think about the make-up of their workforces and how widely they recruited.

Karan Bilimoria has had years to think about these issues. When he first came to Britain from India at the age of 19, his friends and family back home told him he was making a mistake. He would never amount to anything in the UK. The country was riven with prejudice. As an Indian, he stood no chance.13 By the time of the FT Forums event, in early 2021, he was president of the CBI, the British business federation, a member of the UK House of Lords, chancellor of the University of Birmingham and chairman of Cobra Beer, the company he founded in 1989.

So, were his friends and family wrong to worry about him coming to the UK? No, he says. Certainly not back then. When he first trained as an accountant at what is now EY, there was only one ethnic minority partner. And many at the firm said he had only got the position because he had a white English wife.

Heather Melville also knows what business could be like for a person of colour. Earlier in her career, when she worked in banking, a customer racially abused her. The customer seemed surprised, she recalled, to see a woman of colour working there. Her bank supported her. The next time the customer came in, the bank asked him to close his account. By the time of the FT Forums event, Heather was a director and head of client experience at PwC.

Sir John Parker has been trying to ensure that more people like Karan and Heather get to the top of their organisations. John has a huge amount of management experience, in industries ranging from shipbuilding to mining, utilities and aerospace. He has chaired Anglo American, National Grid, and the Court of the Bank of England. He also headed a UK Government review into ethnic diversity in British company boards.

For Sir John, the key to creating diverse teams is the ambition to do so. And that ambition has to start at the top, with targets that the company intends to reach. Targets for the workforce and for leadership positions are vital, whether for women, people of colour or people with disabilities. Targets are, Heather Melville says, different from quotas. ‘I don’t want to work somewhere where somebody sets a quota and says “find me five black people, three people with disabilities, four people who are women”,’ Heather says. Done in that sort of formulaic way, simply filling quotas doesn’t change the organisation’s culture. If people are recruited by an organisation with no real commitment to diversity, Heather says, they don’t stay. Six months later, many are gone. That doesn’t do them or the company any good; it damages the organisation’s reputation. Targets, on the other hand, she says, signal where the organisation intends to go. And, once the targets are in place, the organisation needs to make managers accountable for achieving them, and rewarding them if they do.

Setting targets gets results. It has helped, for example, to increase the number of women on UK company boards. The Davies Review, established with UK Government backing in 2010, set the UK’s top quoted companies a target of having 25 per cent female representation on their boards by 2015. In that year, there were no longer any all-male boards among the FTSE100 companies.14 A subsequent government-supported effort, the Hampton-Alexander review, set a target of one-third of boards of top companies being female by 2020. FTSE100, FTSE200 and FTSE350 companies met the target overall. Boards are only part of the battle. Many of the women on boards were non-executive directors. The next challenge is to raise the number of women in executive management positions.15

For company leaders, this lays out the challenge. Organisations need to attract people not just at the top, but at entry level too, and they need to nurture their careers as they rise through the ranks. That is the way to ensure that they fill executive positions, rather than being only non-­executive directors.

It also requires establishing an environment in which people of different backgrounds feel comfortable. As Karan Bilimoria said, coming into an organisation with few people like you can be a disconcerting experience.

How do you find out what makes people comfortable? Ask them, Heather Melville says. If you have only a couple of black people in the organisation, seek them out and find out how they feel about working there. Sir John Parker says it’s important that top management doesn’t delegate these debates to the human resources department. Heather Melville goes further: when you have these discussions, leave the HR people out of it. When she worked in banking, she says, she really appreciated a senior person coming to her and asking how it felt to be a person of colour working there. The truth was that working there wasn’t always pleasant. But she appreciated being asked, because that is the way leaders learn how the organisation needs to change.

For Karan Bilimoria, it also comes back to mentoring – but a different sort. To encourage greater understanding of the organisational barriers to diversity, companies should set up reverse mentoring schemes, ‘where you have ethnic minority members of a company mentoring their leaders, making them aware and talking more openly about diversity’, Karan Bilimoria said.

Heather Melville says it is vital that those who have long felt like outsiders can be heard. ‘You need to understand the voice of the people that work for the organisation,’ she says. People of colour and those from other less-represented ethnic groups ‘don’t want any preferential treatment. What they want is the same treatment that everybody else gets: the same kind of networks that allow them to progress in their careers, the same opportunities.’ Heather Melville subsequently told me that while progress had been ‘painfully slow’, she thought the best organisations were increasingly analysing their data to develop plans to attract and retain talent.

Roula Khalaf, the FT’s editor, had time as deputy editor to think about how to promote diversity in a news organisation that had not, since its founding in 1888, had a female editor before her appointment in 2020. One of her initiatives was a tool called JanetBot, which told news editors when the number of women pictured in the FT fell below a certain level. ‘We wanted to project the image of a news organisation that can appeal not only to men, but also to women and also to different age groups,’ Roula Khalaf told a World Association of News Publishers summit in 2020.16

Roula Khalaf said that the FT, like many organisations, had diversity problems in its middle ranks. ‘We tend to hire more women than men now, but because of legacy issues and because in the past we hired a lot more men . . . in higher levels and middle levels, you still have far more men in the organisation, leading news desks, for example, or leading teams.’

The FT still had a lot of work to do on racial diversity, Roula Khalaf said. It was not enough just to recruit ethnic minority journalists at the start of their careers because it would then take them 10 to 20 years to reach leadership positions. ‘So, I think you have to work at every level of the organisation.’

FURTHER READING

Some readers may discern in this chapter the management writer Peter Drucker’s notion of ‘management by objectives’. Drucker is one of the most, some would say the most, influential management writers there has been. Stefan Stern wrote an assessment of Drucker’s work, ‘A proselytiser for the human side of business’ in the Financial Times in November 2005, shortly after Drucker’s death. His article is a good entry point into Drucker’s work and is available at: www.ft.com/content/8e5421d8-59e3-11da-b023-0000779e2340.

One of my favourite business books is The Living Company: Growth, Learning and Longevity in Business by Arie de Geus, who died in 2019. De Geus, who was a strategic planner at Shell, was intrigued by how ­short-lived most companies were: the average life expectancy of a large multinational was less than 50 years. But some lived for centuries and de Geus’s book is fascinating on the values and purpose that sustain them.