TeamResearch News

Team Cohesion Led to Simulated Airline Success

Team cohesion—defined as "the degree to which members are attracted to their team and desire to remain in it"—helps teams perform. But little research has looked at how cohesion affects top management teams, and none had been done in an academic experiment where other factors that might have affected the results could be ruled out.

Three scientists created 81 teams of college-senior management students diverse in specialty, gender, and nationality, and gave each an airline to run. That is, they used a respected, very complex computer simulation game "based on extensive research of the commuter airline industry" and considered a realistic model of the airline market. The teams were divided into groups of four to 12. The different groups received different economic scenarios, and competed over a 12-week period with each week representing a quarter-year. To provide motivation, ten percent of each student's capstone-project class grade was tied to his or her team's performance.

On a week-by-week basis, the researchers compared the computer-reported financial performance of each team with its members' reported levels of cohesion. They controlled the data to mask the effects of debt levels, which can affect performance; firm size; number of competitors; team size; and the previous week's performance (so they'd know that performance wasn't causing cohesion, instead of the other way around). Team cohesion had little effect on performance at first (weeks 1-5), began to have an effect at Week 6, and after that made a powerful difference in the ability of a firm to outperform the competitors within its group.

The researchers believe team cohesion fits the definition of a "strategic asset" for competitive advantage. A strategic asset cannot be bought, since competitors presumably have equal access to assets that can be bought. Instead, such an asset is "rare and difficult and costly to imitate…" Among the reasons team cohesion fits the mold are that:

Cohesion develops over time and is affected by many events, thus making it hard to imitate;
It is a social phenomenon subject to the personalities of the team;
It's invisible, "making it hard for competitors to imitate";
It can be hard to identify as the cause of success given the other possible causes, so even if a competitor knows you have it, they may not realize its importance to your success;
Perfectly replicating a team's cohesion would require hiring the whole team, and even if everybody bolted together, "the team's cohesion could be affected by the new corporate climate."

Source: Michalisin, M., S. Karau, and C. Tangpong (04), "Top Management Team Cohesion and Superior Industry Return," Group & Organization Management 29(1):125.

TeamResearch News summarizes the latest information from studies or expert articles on business teams. It is published as a free service of TeamTrainers Consulting.