Making Teams Work in a Changing Market

Winning the Malcolm Baldrige National Quality Award is no small feat. To be given the Baldrige award, a company must excel in three major measurements of quality: (1) customer satisfaction, (2) product and service quality, and (3) quality of internal operations. Previous winners have included such companies as Solectron and the General Motors Saturn Division.

Taking home the Baldrige award was the last thing on the minds of Judith Corson and her partner, Jeffrey Pope, when they evaluated the situation at their Minneapolis-based market research firm, Custom Research, in the early 1990s. The two partners faced a market full of client companies that had downsized and were asking more of Custom Research. The problem for Corson and Pope was that Custom Research was experiencing a flattening of growth—the firm had neither the resources it needed to expand its employee base nor the technological capacity it needed to meet the growing demands. The business partners were facing the hard reality that to survive in the market they would have to provide better management of clients' work with their current staff and resources. Corson and Pope realized they had to do something quickly.

The two partners decided to abandon the traditional departmentalized structure of the organization and group their 100 or so employees into account teams. Each account team would have an account and research team leader assigned to facilitate the direction of the team. In just a short time, communication and the tracking of work improved. Workers were more interested and involved, and clients were expressing satisfaction at a job well done. The business began to thrive.

But after the system had been in place for a couple of years, the partners saw a problem developing. Team members were becoming limited, learning only about the clients or the business categories handled by their group. Corson and Pope swung into action again. They decided that once or twice a year, employees would be reorganized into new teams with their size determined by the volume of work at hand.

Using the team approach at Custom Research has changed things quite a bit. The firm watched its billings go from $10 million in 1985 to $22 million in 1996. Revenue per full-time employee has risen by 70 percent. The firm meets or exceeds its client expectations on 97 percent of its projects and is rated by 92 percent of its clients as better than the competition. Such outstanding performance enabled Custom Research to become not only the smallest but also the first professional-services firm to receive the prestigious Malcolm Baldrige National Quality Award. Leonard Berry, a professor at Texas A&M University, identified Custom Research as one of the 14 best service companies in the world in his book Discovering the Soul of Service. Berry describes Custom Research as "a highly progressive marketing research company that has built a strong business with Fortune 500 clients through team service delivery, innovative practices, competence, and an emphasis on continuous improvement."

Corson says her company always did strategic planning, but in hindsight it wasn't very focused. The Baldrige contest emphasized the need to concentrate on just a few "key business drivers"—the very core of the business. So Custom Research changed its strategy to identify its key drivers and list goals each year that would enhance each one. Besides helping growth, the strong planning kept missteps to a minimum. Judith Corson says that concentrating on core competencies improves consistency: "You don't have as many gaps or surprises."

1			Why do you think worker performance increased so significantly at Custom Research?
2			What principles of motivation seemed to work well for Corson and Pope in increasing employee productivity?
3			Would you like to work in a team-centered organization or in a more traditional organizational setting? Why?