Company Culture

Why Decentralized Teams Perform Better

George Dickson
March 20, 2015
Table of Contents
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This might be uncomfortable to think about, but there's a good chance management is your company's largest bottleneck.

This isn't to say managers are bad at their jobs — far from it. But consider a small sample of the tasks commonly expected of a manager: evaluation, feedback, recognition, rewards, delegation, and task management are just a few.

As the modern employee's approach to work continues to evolve, relying on managers for these myriad responsibilities is an inefficient approach. Not only are employees able to participate in activities like task prioritization, information sharing, and performance feedback, they increasingly expect to.

We shared a list of reasons decentralized teams often outperform their top-down counterparts on LinkedIn recently. Let's take a look at the key advantages decentralization can provide, and some low-friction ways to start experiencing the benefits of a decentralized team today:

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1. Increased revenue and productivity

In a study conducted by the University of Hawaii, self-directed teams were more productive, kept better records, and saw increased revenue.

There are many benefits to structuring work this way, but there are a few things to keep in mind before starting any peer-managed project. It's crucial to make sure everyone shares a clear understanding of their roles, expectations, and share a vision of the project's ideal outcome.

2. Empowered employees

Nobody likes to feel out of control. Decentralized teams reverse that sentiment by empowering employees with a meaningful voice within the organization, and autonomy regarding how they approach their work. In decentralized teams, the people who work closest to the project are the ones most empowered to alter its results.

Start by shifting the responsibility of giving feedback from a top-down dynamic to a more equal-footed team dynamic. Employees will feel the power of their voice being heard, which often carries the added benefit of igniting engagement and participation.

3. Motivated employees

Most of us are familiar with the motivational power of peer influence (for better or worse), and work is no exception. A University of Iowa study showed that "...peer-based rational control corresponded with higher performance for both individuals and collective teams."

Offer an environment that encourages peer communication to inspire the motivational qualities of peer influence.

4. Balanced performance reviews

The balance and objectivity in decentralized teams improve performance feedback. Team members working closely together often have a well-developed understanding of their colleagues' performance. A level playing field is also more conducive to honest, accurate evaluations.

If you're not ready to give up on manager-to-employee performance reviews, start by taking peer feedback into consideration while performing them.

It's possible to benefit from distributed teams without dropping everything or starting from scratch. Explore the possibilities with smaller steps, and let the results of those experiments decide the next steps.

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