What is a self-managed team and how does it work?

Although the traditional, hierarchical team structure has been a workplace staple for decades, it may no longer be the most efficient way for some businesses to work. With customer experience (CX) and employee retention being more important than ever before, business leaders must think of innovative ways to make the most of their employees’ skills whilst keeping them happy. When implemented correctly, a self-managed team (sometimes referred to as a ‘pod’, ‘bubble’ or ‘autonomous team’) structure can be a game-changer for organisations. In fact, as early as 2017, 93% of companies expressed an interest in enabling some level of self-management amongst their employees. That number is also set to rise as the pandemic has demonstrated the power of staff autonomy. In this article, we’ll explore the main benefits of self-managed teams, explain how they work and share how business leaders can begin to transform their working models.

What is a self-managed team?

Typically, self-managed teams take full responsibility for a particular end-to-end process within a larger company. Unlike a traditional team, most autonomous teams don’t have a hierarchy. Instead, they have the power to create processes and roles based on what is needed for the work at hand. In many cases, when given greater autonomy, employees can create more streamlined ways of working and alleviate the managerial pressure that can plague more traditional team leaders. The result is happier customers and less stressed staff, which we will delve into later in this article.

How do self-managed teams work?

To explain how a self-managed team works, let’s look at a customer service team as an example. Instead of taking a segmented approach, where the customer is sent to a particular department based on their requirements, a self-managed team would handle the entire lifecycle from onboarding to customer services, complaints and early arrears collections. The team would consist of several people who are working towards the same goal and have a complete understanding of the customer’s needs. Since all team members have that historical knowledge and no defined roles, anyone can jump in and assist the customer with their query and guarantee that they’ll be delivering the same excellent service. To keep everyone focused and ensure the output is in line with the needs of the business, the team would have specific guidelines they need to follow. For example, the company may still need team members to adhere to SLAs or KPIs. But, beyond those guidelines, the team runs itself with no manager figure in place. Instead, each project would require different people to take the lead depending on their strengths. Overall, the entire customer service team would be responsible for completing each ticket, so it would be a group effort to manage workflow, daily activities and role delegation. However, there are several pros and cons to running a team autonomously, so read on to learn more.

The benefits of self-managed teams

1. Increases productivity

As we’ve seen over the last two years, with the pandemic causing so many people to step out of the office and work independently from home, autonomy doesn’t harm productivity and can actually significantly improve it. Interestingly, a psychological study conducted in California has shown a clear link between independence and productivity, with autonomous workers being 5% more productive on average than those working within a rigid hierarchy. Allowing the people who make the most contact with customers each day to shape the processes around their needs often leads to a better outcome because they can consider anecdotal evidence. Consequently, staff members will have more efficient working methods, leading to speedier turnarounds and higher quality services.

2. Encourages creativity

Although it’s hard to quantify levels of innovation and creativity, the nature of self-managed teams means that ingenuity can thrive. Without the oversight of a manager, people may feel less stifled by established practices or approvals processes, which often creates a bottleneck or prevents people lower down the hierarchy from speaking up. As team members begin to feel more comfortable presenting their ideas, the company will benefit from more diverse perspectives that can help create novel solutions to problems. According to IBM, CEOs say that creativity is the number one factor for future success, so it’s imperative for businesses to harness that power before they fall behind the curve.

3. Improves motivation

For 46% of employees, autonomy in decision-making is essential. Without some level of freedom, team members quickly begin to feel undervalued and unmotivated at work, which can have a knock-on effect on performance. With a self-managed team structure, people are given more opportunities to grow their skill sets and gain the experience and motivation they need to move into more senior roles. By providing room for advancement, companies should notice that job satisfaction improves, employee turnover decreases and their bottom line ultimately remains healthier.

4. Reduces pressure

Did you know that 37% of managers think their position will disappear within the next five years? Evidently, there is some concern surrounding the topic of autonomous teams and how it will affect managers’ job security. Fortunately, the anxiety may be unnecessary. Whilst autonomous teams will primarily be responsible for themselves, they will still operate within a ‘normal’ working environment. Essentially, there will always be a need for a senior manager at the head of the department to ensure the team is on the right path. The difference is that the person overseeing the team won’t be obligated to deal with every problem single-handedly as it’s the team’s responsibility to share that duty. As such, managers can free up their time to focus on more specific and business-critical tasks.

5. Enhances the customer experience

In a standard team, a customer’s request could get passed between many people, which leads to frustration. Unsurprisingly, 37% of customers say that being “passed around” annoys them the most. Conversely, an individual within a self-managed team will take care of every stage in the customer’s journey, making their treatment more consistent and speedy. As a result, the customer retention rates should increase.

The drawbacks of self-managed teams

1. Groupthink

Generally, autonomous teams are designed to encourage creativity, but they can have the opposite effect at times. ‘Groupthink’ is a term coined in 1952 by sociologist William H Whyte and explains how people’s need to conform to a group can lead to irrational decision-making. Suppose an individual dislikes a specific process or task — and they convince others to agree with them — it may lead to the process or task becoming unpopular regardless of its necessity. In such cases, ‘groupthink’ will cause the entire group to avoid completing certain tasks to maintain conformity, which can hinder projects and decrease productivity in the long run.

2. Poorer performance

Some individuals — particularly more junior or inexperienced team members — don’t perform as well without the direct guidance of a manager. At worst, some team members may make poor decisions due to a lack of experience or correct information. Furthermore, without a manager to intervene and take control of issues, the team may lack the ability to drive projects forward. As such, businesses that are considering building a self-managed team should first ensure that their employees are capable of taking on a greater level of responsibility.

3. Slower decision-making

One of the biggest strengths of a self-managed team is that it allows more ideas to be considered during the decision-making process. However, that strength can also be one of the greatest weaknesses. After all, everyone will have an opinion, and ensuring every decision is heard can make the process extremely slow. Unfortunately, rapid solutions to customers’ issues are vital in customer service, so slow resolutions will decrease satisfaction rates and possibly cause people to look to competitor companies that can offer speedier solutions. To prevent the team from becoming bogged down, it’s crucial that the team assigns someone as the ‘leader’ for each project and takes turns alternating who will take on that role. Not only will everyone then gain experience in a leadership role, but it also speeds up the decision-making process.

Steps for implementing self-managed teams in your organisation

Whilst implementing a self-managed team has some drawbacks, they typically occur when it’s not been executed correctly. In order to reap the benefits of transforming your customer service function, there are some steps you should consider following:

1. Identify where to start

Remember, self-managed teams aren’t going to work in all areas of an organisation. Therefore, the first step business leaders must take is identifying which groups will benefit from a more autonomous structure. To make the decision, it’s a good idea to look at employee performance and organisational structure. Being in a self-managed team is a lot of responsibility, so it’s crucial to ensure the employees involved can handle it. For example, a group of more junior staff members may struggle without some guidance.

2. Establish goals and guidelines

Before transforming a traditional team into a self-managed one, business leaders should ask themselves the following questions:

• What are the team’s goals?
• How will the self-managed team tie into the larger organisation?
• How often will a senior manager check-in with the team? Who will that manager be?
• Without a manager, what guidelines and targets will exist to keep the team on track?

These questions will help a company pinpoint precisely where they can benefit from changing the structure of their teams and make the transition much smoother.

3. Develop team roles

Once the team has been made aware that they will be transforming into a self-managed team, it’s important to familiarise them with the idea of having a non-static role. The team members will need to be adaptable and willing to take on a variety of tasks to ensure that the workload is spread evenly and that no one holds a leadership role for too long. Involving the team members early on will enable them to discuss their skills and experience levels so they can be assigned roles and tasks that play to their strengths.

4. Practice

As the saying goes, “practice makes perfect”. No team will get everything right the first time, so it may help to walk through a project or process together in the beginning and slowly hand over more of the management to the team members. During the practice stage, it’s important to collect feedback that will enable the team to run more effectively. However, there’s a good chance that the chosen team hasn’t worked in a self-managed environment before, which can make the transition stage tricky. To make the switch simpler, businesses should consider outsourcing to a third party that’s familiar with the ins and outs of working autonomously as they can guide and shape the process.

Make the switch to a self-managed team structure with Sigma Connected

At Sigma Connected, we’re no strangers to autonomous working. In fact, we provide self-managed team structures for some of our key blue-chip clients, helping them transform their traditional team into fully functional self-management teams, eliminating the frustration and difficulties that often come from handling such transitions in-house. Don’t get left behind the curve. Get in touch today to learn more about how we can transform your customer service team and revolutionise your current processes.