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Summary of Group Effectiveness: What Really Matters?
By Rameshwar Arora , 2014FPM09

Definition of a Group: A set of three or more people that can identify itself and be identified by the others in the organizations as a group.
Purpose of the paper : “This article examines why groups succeed or fail and draws on a detailed case study.”
Structure of the paper: Criticism of current knowledge base of group effectiveness,
Criticism of current knowledge base of group effectiveness:
1. Current gaps in behavioral science research and theory about groups
2. Group task effectiveness have not well coped up with the increasing imperativeness of group performances.
3. The laboratory studies conducted are time bound and influenced by experimenter. (Drawback – Some crucial variables might be fixed at constant levels , rather their variations would be interesting to see)
4. The work on group dynamics is not insightful as well.
(Drawback – It is not generally determined what all phenomena affect or lead to the

Three factors play a major role in determining group effectiveness, according to these authors: task interdependence (how closely group members work together), outcome interdependence (whether, and how, group performance is rewarded), and potency (members' belief that the group can be effective).
Let us discuss the salient features of each of these three Determinants of Work group ; “these variables influence group performance and can be influenced by members and supervisors of groups.”
Task interdependence
Outcome Interdependence exists when the group yields consequences that are shared by all the group members. Distribution of these outcomes (rewards or punishments) maybe be either cooperative or comparative.
Some organizations , for instance Toyota, provides rewards based on their group task performance , the same trend not visible in many US based firms.
Potency is the collective belief of group members that the group can be effective.

Determinants of Work group effectivenss | Basic meaning | Additional comments | Related issues | Task interdependence | is measured in terms of degree of task-driven interaction amongst the group members | Ways in which group members can turn this around :”1. Working in parallel 2. Having no or little contact with each other.3. Working in sequence.4. Interacting frequently. | In case a few groups have failed to address a task , the group taking up the task should endeavor to complete it as a challenge(showing belief in their efficacy). | Outcome Interdependence | exists when the group yields consequences that are shared by all the group members. Distribution of these outcomes (rewards or punishments) maybe be either cooperative or comparative. | Some organizations, for instance Toyota, provides rewards based on their group task performance, the same trend not visible in many US based firms. | Imperative to note: How outcomes are distributed. | Potency | “is the collective belief of group members that the group can be effective.” | Potency is closely linked to group performance and mutually dependent on task interdependence | How and I what aspects should the groups implement the approach of potency? Level of involvement and in what capacity? Its impact on outcomes. |

What can be done to ensure success prior to a task assignment?
Authors suggest
1. The group should have a clear charter (The members involved must have a list of key tasks that take the top priority , well- defined group goals).
2. Estimating the resource requirement and availability ( This affects the group members’ perceptions , motivation , and helps in building confidence toward a winning path).
3. The manager must decide what type of group he wants – Either task interdependence and outcome interdependence should be lined up or else group members should have the opportunity to do this themselves.

The framework of Model of determinants is explained in Figure 1 of the paper . The Managers can use this framework to diagnose how well the groups are faring on these three dimensions.
1. Lack of cooperation may reflect “personality conflicts”
2. Lack of motivation may reflect laziness , but it may reflect the failure of seting of conviction
3. If the charter was apparent to members as charade , they felt impotent and acted accordingly.
4. Pressure from group members to change job descriptions or policies and procedures maybe a response to change in outcome interdependence.
If the change in behavior of employees is misread it can lead to wrongheaded “correction” which is a futile attempt, anyways.

Hence the authors suggest that :
1. Group management style should be facilitatory in nature and not intervention based.
2. The group opinion should be upheld.

800 outlets of a national retail cooperation.
Aim : to increase sales.
Exogenous variables: Store renovating, advertising, corporate pricing
Management belief: 1. Increasing group incentives would help boost the sales. Bonus was paid relatively noncompetitively, based on percent sales gain and the hours worked by a group member. 2. No penalty for losses.
Methodology adopted by researchers: Administered the same questionnaire twice once when the bonus plan was not applied and again when the bonus plan was implemented and in use for past 6 months. Findings/Differences | Bonus plan was not applied | When the bonus plan was implemented and in use for past 6 months. | Salespeople who finished the survey (primary focus) | 435 salespeople were women | 360 salespeople | | 75-80% full time employees, average members in sales team 4 to 25 , average at 9. | | First level managers | 61 | 62 ( and 44 upper level managers) | Questionnaire | Structured/unstructured items designed to quantify (suing scales) task interdependence and potency (outcome interdependence to a lesser extent). | Included internal measure of customer service to complement external measure of sales gains or losses for first three months. | Sales gain (outcome interdependence) | Comparatively lesser outcome interdependence. | Increase of 28% ; Outcome interdependence increased significantly (in 7 months of study) | | | | Potency(it is thus contrampaneous) | Related strongly to group performance | Related strongly to group performance | Task interdependence | More interaction more potency | Sales team excercised substantial discretion in their patterns of interaction, enabling to adjust to such changes. | Blocking | Higher blocking behavior | Decline in blocking behavior seen. | Facilitating | | The more facilitate or produced the more the customer-service rating | Producing | | The more facilitate or produced the more the customer-service rating | Initiative | Lesser initiative taking environment | Employees started taking initiatives both with customer and management (incentive driven??) | Decision making | Involvement causes potency or vice versa and groups belief in their efficacy and involvement in decision making – these two relations need further research.Involvement causes potency or vice versa and groups belief in their efficacy and involvement in decision making – these two relations need further research. |
Please note: “A second group level measure of performance gains in sales was not found to be related to hypothesized causal variables.”
This can be explained by :
1. In the short run of 7 months the systemic change in outcome interdependence may have overwhelmed adjustments made by individual groups.
2. Changes in customer service behaviors and not the sales figure would give a better picture of group performance, at least at group level.
3. The corporationwide change in outcome interdependence has contributed none or very little to 28% sales gain.

Implications :
1. “Group managers should attend closely to the degree and type of outcome interdependence.”
2. “Managers should focus on group potency.”
3.” Managers should expect groups to establish their own patterns of tas driven interactions.”

These are very much in line with the other paper we have reviewed for the same topic.

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