Mays Business School, July 2nd, 2020
The COVID-19 pandemic and the widespread lockdown associated with it has been a shock to most organizations, causing leaders to adapt to the impacts of sudden changes to the way they do business with external stakeholders (e.g., customers) as well as how they manage their workforce. As we have seen, the severity of this shock has created immense challenges for even the most stable and well-resourced firms. For businesses that are resource constrained or that operate in unstable environments, which includes most entrepreneurial firms and small businesses, this unforeseen shock may pose an existential threat to their ability to stay in business.
The enormous amount of information that is being disseminated concerning the situation, much of which is contradictory, has only compounded the effect of the pandemic and lockdown on leaders’ abilities to chart a course through this crisis. At the same time, there is much more unknown than known about COVID-19. This creates a state of affairs in which there is too much data for leaders to digest, and in spite of this information overload, there is also more uncertainty about the future than most leaders have ever faced. Again, even CEOs of large organizations, who have entire teams of advisors, have admitted that they do not know how the next two to three years will unfold. For entrepreneurs and small business owners, trying to balance the wave of data that this crisis is generating and plot a path forward into the murky future can be particularly overwhelming and depleting.
Fortunately for many entrepreneurs and small business owners, they are not alone in their struggle to respond to the pandemic and the lockdown. Although it is common to portray small and entrepreneurial ventures as being led by a lone individual at the top of the organization the reality is that the majority of these firms are helmed by a team. In my research on new venture teams, I define these people as “the group of individuals that is chiefly responsible for the strategic decision making and ongoing operations of a new venture.” While this definition focuses on firms in the early stages of the entrepreneurial process, companies at all stages of development tend to have some form of top management team that collectively guides the organization.
The distinction between the lone entrepreneur and a venture team is important. Research has shown that teams have advantages over individuals when it comes to decision making. Teams can gather more information, offer more perspectives, and develop a greater number of approaches, often leading to more creative and effective solutions than those generated by individual decision-makers. Another advantage of team-based decision making involves what happens after the decision is made. Specifically, rather than a single leader having to explain to employees why the decision was made and trying to get them to buy into that course of action when the decision is made by a top management team, the result is a group of leaders who had a say in the decision process and therefore feel committed to communicating and executing the decision.
That’s not to say that team-based leadership is all roses. As anyone who has suffered through a strategic offsite can attest, group-based decision making is far slower than having a single leader call the shots. Moreover, just because the group setting allows all team members to contribute does not mean that they necessarily will. Introverted members may be reluctant to voice their insights, and extroverts may dominate discussions even if they are not the experts on a given topic. Stalemates in which group members cannot come to agreement and groupthink in which teammates fail to critique proposed courses of action can also erase the potential benefits of team-based leadership.
For leaders seeking to take advantage of the power of teams to help navigate their venture through these uncharted waters, the question that arises is how to maximize the benefits of their leadership teams while mitigating the downsides. My research suggests three components of high-functioning teams that are particularly relevant to the challenges caused by this pandemic.
1. A climate of psychological safety.
Over time, organizations develop a system of shared values and beliefs that guide the behaviors of their employees; we call this organizational culture. The same thing happens within teams, only we refer to it as team climate. What is the climate of your top management team? Is that climate helping or hindering your ability to lead in this time of crisis? Why? Odds are that your answer to those questions will involve the presence or absence of psychological safety in your team. Psychological safety refers to the extent to which team members collectively feel that they can speak up, take risks, and be creative without fear of being punished or ridiculed for doing so. Put another way, in teams with high psychological safety, team members are comfortable making themselves vulnerable to one another. A great deal of research indicates that a strong climate of psychological safety is key for high team performance, and it is not hard to understand why. Think about your current team, which is currently facing unforeseen challenges that likely require creative solutions. In developing these solutions, it is critical that all members feel comfortable sharing their unfiltered thoughts and ideas, and constructively critiquing those of others, which is what happens in teams with high psychological safety. When psychological safety is low, your team is like a racecar that is running on four of its eight cylinders, because members are holding back their boldest ideas and sharpest critiques due to fear of the consequences. Fortunately, one of the best ways to develop psychological safety in teams is for the leader to model it, and a crisis presents an opportune time for you to show some vulnerability to your team members, thereby encouraging them to do the same.
2. Healthy conflict norms.
The pressure and stress caused by the pandemic will undoubtedly lead to higher incidents of conflict within organizations and teams. All of us are just a bit more on edge than usual. Some leaders seem to feel that conflict among team members is good, or even necessary, to achieve high performance. Team conflict has been studied for decades, and the conclusion from this body of evidence is clear – most of the time, conflict hinders team functioning. To understand why it is important to consider the two main types of team conflict. Task conflict refers to disagreement among members regarding how to complete the task at hand. Relationship conflict also involves disagreement, but it emanates from interpersonal issues among team members, and typically includes tension, annoyance, and animosity. Although task conflict slows down team decision making, when it is present in small and controlled doses it can contribute to higher group performance. Relationship conflict, on the other hand, always harms team functioning and performance. The takeaway for leaders is to observe how their team handles conflict. Often, disagreements begin as task conflict and then escalate into relationship conflict. This is where leaders need to be managers and help develop norms for “healthy fighting” within their team. If those norms do not currently exist one shortcut to harness the bright side of team conflict is to publicly appoint one group member the role of assigned critic, also known as a devil’s advocate. Because this member is tasked with critiquing the rest of the team’s ideas, they can do so and in turn generate healthy task conflict without activating the interpersonal dynamics associated with relationship conflict.
3. Balance between stars and role players.
It does not take an avid sports fan to notice that oftentimes the most successful teams are not filled with star athletes, but are comprised of a mix of star performers and lesser-known “role players.” Research indicates that teams that are balanced in this way often outperform more talented teams because teamwork requires maintenance, and while not glamorous, someone has to do it. And in the face of this pandemic, this “dirty work” is more critical than ever. There is a tendency, in times of crisis, to not focus on the details as closely as usual or to let more mundane team duties pile up in the background while focusing on the immediate threat to the business. In addition, most of us are in more fragile emotional states than usual right now which can cause emotional instability within the team on a day-to-day basis. Therefore, teams that have members who are willing to roll up their sleeves and stay focused on the details, handle the mundane tasks in the midst of the crisis, and take care of the emotional needs of team members will be able to more effectively respond to the challenges that arise over the coming months and years. Put another way, in the words of New England Patriots coach Bill Belichick, when it comes to critical moments, leaders should “forget high flyers” and count on their consistent performers, who he has dubbed his “dependables.” So consider your current team and ask yourself who is handling the dirty work while you and your star performers tackle the big problems? Who are your dependables? If the answer is no one then you are setting yourself up for failure, or worse yet, burnout as you try to lead and micromanage at the same time.
In considering these three elements of high functioning teams in light of this crisis, you may realize that you have deficiencies in your team. Indeed, perhaps strengthening some of the weaknesses in your top management team was on your “to-do” list even before this pandemic-induced crisis. As I described above, some of these weaknesses may be addressed by making changes to your leadership behavior. But correcting other shortcomings may require changes to the membership of your team. If that is the case, there is some good news. Economic downturns present the optimal time to recruit and select top managers. With the current economic challenges hiring may be the last thing on your mind. However, by seizing opportunities to upgrade the strength of your venture team during this time of uncertainty, you will be positioning your firm to thrive in the future, no matter which “new normal” becomes reality.
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 Coyle, D. (2018). The culture code: The secrets of highly successful groups. Bantam.
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 Bolinger, A. R., Klotz, A. C., & Leavitt, K. (2018). Contributing from inside the outer circle: The identity-based effects of noncore role incumbents on relational coordination and organizational climate. Academy of Management Review, 43(4), 680-703.