Whats this Managing High Performance Virtual – Remote – Telecommuting Teams Business Case about? Please explain why? and analyze, and discuss in great detail Which are th

HBR CASE STUDY

A hot team turns

around a moribund

division, but now,

with success behind

it, the team is

running icy cold.

Should This Team Be Saved?

by Hollis Heimbouch S, this is Captain McMahon. We're anticipating a fair amount of

turbulence as we head over the Rockies, so I'm turning on the fasten seat-belt sign until we clear this rough patch. Thanks for your patience."

Peter Markles clicked the "save" but- ton and looked up from his laptop. His gaze shifted from the pale blue com- puter screen to the cloudless blue sky visible through the porthole. "Rough patch?" he wondered. "It looks as smooth as glass out there." Appearances certainly can be deceiving, he mused, before turning his attention back to the

JULY-AUGUST 2001 31

HBR CASE STUDY • Should This Team Be Saved?

computer on the tray table. Peter was drafting a speech for this evening's cel- ebration; his team at Vigor Skin Care would be receiving the company's high- est award for performance. Never mind that the team had slowly been losing steam. Tonight, they would party. To- morrow, Peter would have to figure out what to do.

Rejuvenating the Business When Peter took the reins four years ago. Vigor Skin Care was the sleeping dog of the industry, producing an unre- markable line of cosmetics, soaps, and skin-care lotions that barely broke even year to year. Vigor was a division of one of the largest packaged-consumer-goods companies in North America. At first, Peter hadn't known exactly how to save the flagging business unit-he could admit that now-only that it deserved an honest try. After all, wasn't Vigor's original mission-to provide safe and healthy skin-care products for the whole family-still valid? True, the company's product portfolio wasn't as slick and trendy as some of the recent entrants in the market, but Peter had always liked underdogs, and Vigor was just that.

Peter had spent the first 15 years of his career with another one of the coun- try's largest consumer goods companies. He had been hired right out of college as a district salesperson and had spent thousands of hours driving from ac- count to account in the upper Midwest. During his tenure at the company, he was a dynamo: first, he was named national accounts manager, then global accounts manager, and twice he was named Vendor of the Year by one of the giant retail chains. Eventually, he be- came a division vice president.

Years later, Peter still loved the thrill of closing the deal-give him a decent

HoUis Heimbouch is an executive editor at Harvard Business School Press in Boston and a contributing editor at HBR.

HBR's cases present commort managerial dilemmas and offer concrete solutions from experts. As written, they are hypo- thetical, and the names used are fictitious.

product, and he'd always beat his sales targets. He thrived out in the field, bringing along the junior sales staff, offering them tips on how to manage difficult accounts, and bucking up the team when a crucial sale fell through. Although Peter had never gotten an MBA, his hard work, street smarts, and people skills more than made up for what he lacked in advanced degrees. The corporate guys may have the cre- dentials, he reasoned, but his gut was almost always right, and he'd developed a reputation for making the most out of what he was given and then some.

Nevertheless, when the offer came to lead Vigor Skin Care, Peter knew it would test all his skills. On the face of it. Vigor's challenge was no different from the one every mature organization confronts eventually: How do you re- juvenate the business? Peter knew he couldn't merely push products that cus- tomers didn't want, nor could he simply bulldoze his way through headquarters demanding more resources. No, the di- vision's turnaround would require equal parts discipline, politics, and creativity. He couldn't do it alone.

Buiiding the Team Sandy Fryda, Vigor's longtime market- ing director, was the last person Peter had expected to tum to for help-espe- cially since Sandy appeared to have been a major contributor to Vigor's desultory performance for many years, initially, he had pegged Sandy as one of those polished corporate players, with- out the stomach for making bold moves. The best he could hope for would be defensiveness on her part; at worst, he'd have to ask her to leave. But when Peter finally met Sandy face-to-face, she had surprised him. At a breakfast meeting that lasted through lunch, Sandy can- didly laid out her frustrations and am- bitions for Vigor. "I've been waiting for a chance like this," Sandy announced, as she handed Peter a large file contain- ing the marketing campaigns and stra- tegic recommendations she had drafted to support Vigor's makeover. Like Peter, Sandy believed that Vigor was a brand worth saving. But headquarters paid at-

tention to the divisions only when prob- lems became crises, she explained. Vigor needed an outsider to stir things up.'Tm great behind the scenes, but you're the guy who can save the day. And besides," she said with a wink,"l know where the bodies are buried. I'll show you around." So it began: Sandy would help Peter navigate the tricky waters at headquar- ters. But who would contribute the cre- ative vision that Vigor lacked?

Thirty-year-old Josh Bartola had al- ready made a name for himself as the founder of Snap, a small cosmetics com- pany that catered to hip, young urban- ites. With no business experience but plenty of inspiration, Josh had turned Snap into the market leader before Vigor's parent company purchased it. Snap was safely on the road to prof-

32 HARVARD BUSINESS REVIEW

Should This Team Be Saved? • HBR CASE STUDY

itability, and Josh had stayed on as a kind of nomad in the corporate research lab, offering random and unsolicited advice to anyone who would listen and some- times stumbling unwittingly into the middle of a turf war. There was little doubt that Josh was a wildly creative en- trepreneur, but he was also naive and fiercely independent.

One day, Josh barged into Peter's of- fice, wearing Dr. Martens boots and a faded Clash T-shirt, interrupting a meet- ing between Peter and Sandy. "I've got it!" Josh declared as he slapped the table. For an hour, he waxed rhapsodic about an entirely new positioning for Vigor Skin Care that would address consumers' desire for fashionable and healthy products, josh had been devel- oping a new kind of skin conditioner

that was all natural, hypoallergenic, and enhanced with vitamin E and UVA pro- tection. The conditioner would be per- fect not only in Vigor's existing skin-care products but also as an ingredient in a new line of specially enriched cosmet- ics-everything from skin cleansers to mascara to lip gloss. Josh already had the name, too: Ageless Vigor. Raising their bottled waters in a toast, Peter, Sandy, and Josh-the "fearsome three- some," as Josh had nicknamed them- set out to breathe new life into Vigor.

Creating Resuits In Ageless Vigor's early days, Peter joked that he spent more time with Sandy and Josh than he did with his wife. When Peter arrived at the office each morning, he came to expect that the first voice-

mail message of the day, left late the night before, would be from Josh, excit- edly describing his new ideas for Ageless Vigor's packaging and branding. Min- utes later, Sandy would usually arrive with two cups of coffee and a list of the day's action items. Sandy's uncanny abil- ity to anticipate corporate headquar- ters' reaction-and to move the Vigor team out of the line of fire when neces- sary-proved invaluable to Peter.

Acting as chief political adviser and war room commander, Sandy would help Peter sketch out Vigor's strategy. And just when they were starting to feel overwhelmed by all the tasks that lay before them. Josh would storm into Peter's office with a pizza, a new CD they must listen to, and prototypes of Ageless Vigor for the staff to try. Josh

JULY-AUGUST 2001 33

HBR CASE STUDY • Should This Team Be Saved?

was always full of enthusiasm and new ideas, which he loved to bounce off of Peter. "Give it to me straight," he would demand. "Which ideas hold water, and which ones are too out there?"

They were an unlikely team-Peter the rainmaker, Sandy the corporate sur- vivor, and Josh the rebel visionary. They were stronger together than they'd ever be on their own. In fact, Peter believed

of the product line had made it to mar- ket-granted, with phenomenal results- but the rest of the line was still months behind schedule because of problems with suppliers and quality controls. Peter had already sprung into action, working with his manufacturing direc- tor to iron out the kinks in the system. Vigor's manufacturing director seemed happy enough for the attention, but

precious political capital better de- ployed in another battle. Was Josh worth that kind of fight? Did Vigor still need the dashing feats of creative ge- nius that only Josh could provide?

As if matters with Josh weren't strained enough, there was Sandy to worry about. Peter suspected that she was feeling burned out by the pace of the last four years. The hours had been

Peter was deeply troubled by the sense that his closest allies, Sandy and

Josh, seemed to have none of their original gusto when it came to tackling

the day-to-day problems involved with distributing Ageless Vigor.

that the team actually made him a bet- ter leader. Like Vigor's new antiaging cream, the trio seemed to thrive on some mysterious fonnula."I don't know how it works," Peter had confessed to Sandy, "but it does." And Peter wasn't the only one who noticed. The fearsome threest>me seemed to have undergone a transformation, each person exceeding his or her abilities, each making the most out of what he or she had to work with. There was no way around it: the last four years-all those heated discus- sions, the endless presentations, the down-tO"the-wire decisions-had been the time of Peter's life, thanks in no small part to Sandy and Josh.

Dealing with the Fallout The plane pitched and yawed a little, as Peter once again clicked "save." As far as anyone could tell. Vigor Skin Care's star was still rising, but Peter knew that the division had stumbled these past two months, even if the numbers didn't reflect that yet A manufacturing prob- lem meant that best-selling Ageless Vigor moisturizer had been out of stock for three weeks. Peter's sales team had spent two years getting key retailers to carry the line, and even one delay could permanently strain those relationships. His other concern was that the launch of the second phase of Ageless Vigor products had been more costly and slower than expected. Only two-thirds

Peter found the meetings a bit tedious for all their urgency. He missed the cre- ative process of working out strategies with his team and the energy that Sandy and Josh brought to the table.

Indeed, Peter was deeply troubled by the sense that his closest allies, Sandy and Josh, seemed to have none of their original gusto when it came to tackling these sorts of day-to-day problems. In- stead, they oniy seemed interested in "blue skying" – spinning out wild ideas for the future. What had happened to the fearsome threesome?

Within the past month, more than a few of the voice mails Josh left were to explain why he couldn't meet with Sandy and Peter at their usual time. He always seemed to be rushing off to lunch with executives from another division of the company; clearly. Josh was flattered hy their requests for his advice. Peter suspected that the divi- sion's interest in Josh was more than just casual. And why not? Who wouldn't benefit from having someone like Josh on hoard? Vigor certainly had, and now an initiative was under way at head- quarters to encourage this sort of cross- pollination among the business units. But there was still work to he done at Vigor, and Peter didn't have another Josh waiting in the wings. If Peter wanted to keep Josh, he would have to put up a fight at headquarters. And that, as Sandy had taught him, might expend

long, the work intense, and now Vigor had moved to a different phase in its life span. The days had become more predictable, the early morning huddles less frequent, and Peter didn't rely on Sandy as much as he once did when it came to managing his superiors in head- quarters. Peter had started to hear from others that Sandy was showing up late to meetings and wasn't returning phone calls or answering e-maiis as promptly as she used to. If only Sandy would regain some of her enthusiasm, perhaps the team would be okay. Peter needed a strong person to bring greater pre- dictability to Vigor's operations, and when Sandy was at her best, she un- doubtedly could fill that role. Perhaps he should ask her to step up to a new as- signment. Or was she ready to move on? Perhaps he was ready for her to move on. One way or another, they needed to talk, even if he didn't know quite what he wanted to say.

"This is Captain McMahon. Well, air-traf- fic control says the worst is behind us, so I'm going to turn off the fasten seat-belt sign. We'll be landing in 40 minutes."

With one more glance out the win- dow, Peter loosened his seat belt. Yes, tonight there would be speeches and applause and toasts to the future. But tomorrow, Peter would have to face the question: Should he try to keep Vigor's product team together?

34 HARVARD BUSINESS REVIEW

HBR CASE STUDY • Should This Team Be Saved?

Should Peter salvage the Vigor team? Four commentators offer their advice.

"At Peter's age, this is decision time. What does he want out of life?"

Marshall Goldsmith is an executive coach based in Rancho Santa Fe, California. His latest book is Coaching for Leadership (Jossey-Bass, 2000).

Peter Markles's world has changed. The inspiration and ability that led to his great success in the past may be very different from what is required to meet his future challenges. Before he can reenergize Vigor, Peter will probably need to reenergize himself hy asking some tough questions. The answer for the Vigor team begins with Peter's own selfinquiry.

First, does Peter really want to be at Vigor Skin Care? He has always liked underdogs, has loved the thrill of closing the sale, but seems to find manufactur- ing tedious. At Peter's age, this is deci- sion time. What does he want out of life? If his passion is to continue selling and buiiding new organizations, he may well be in the wrong place. Now could be a good time for Peter to leave. He could give way to a manager who loves manufacturing and who may be better suited to nmning a maturing business. Peter could move on to another chal- lenge that might more closely match his desires and skills-and he could go out as a winner if he leaves now, while Vigor Skin Care is still perceived to be on the upswing.

But let us assume that Peter decides to stay. If Vigor is going to be his passion.

he needs to find excitement in leading a more mature business. He needs an ally in manufacturing-for instance, an ad- viser or liaison in that department-to determine how he can make the biggest positive contribution to Vigor's success. He needs to personally commit to mak- ing the more mature Vigor work – in the same way that he committed to creat- ing the "new" Vigor. After he's resolved these questions for himself, he can ad- dress his concerns with Josh Bartola and Sandy Fryda.

Peter's thought of putting up a fight with headquarters on Josh's behalf is a completely useless idea. Josh is a creative genius who has already sold one com- pany. Getting ahead in the organization is clearly not his major goal. An impul- sive person like Josh is not going to be told what to do by Peter, the organiza- tion, or anyone else.

Peter and Josh need to sit down and discuss their personal goals. Vigor Skin Care's goals, and the future of the com- pany. Can Ageless Vigor's product chal- lenges still motivate Josh? And how can Josh's talents best be put to use? Ulti- mately, Peter needs to consider Josh's best interests and those of the larger organization.

Frankly, it sounds like Josh may no longer have his heart in Vigor Skin Care, if this is the case, Peter should express great appreciation for all that Josh has contributed to Vigor, and he should ask Josh to continue to help him as a friend, consultant, and adviser. Josh may be more suited to this less formal role and, if asked in the right way, may respond to it positively. In this advisory role. Josh could still help Vigor Skin Care address its problems and uncover new business opportunities. He could also focus on finding synergies between Vigor and the larger organization. And the parent company's cross-pollination efforts may make it easier for Josh to apply his cre- ativity and great enthusiasm to other business units.

If Peter decides to stay, he may still be able to form a new team, with Sandy as a core member. The third team member should probably have the same passion for manufacturing that Josh has for In- novation and that Peter has for sales; this person might become the COO of Vigor. Sandy did a fantastic job coaching Peter; she could resume that role, help- ing this newest team member in the same way. Together, they may be able to take Vigor to the next level.

36 HARVARD BUSINESS REVIEW

Should This Team Be Saved? • HBR CASE STUDY

"Peter way be overestimating the team's role in the future success of Ageless Vigor and Vigor Skin Care as a whole."

Nancy Bologna is senior vice president of human resources at Best Buy, based in Eden Prairie, Minnesota.

Peter intuitively gathered the ideal team for Ageless Vigor's initial launch; as a result, the team is slated to receive the company's highest performance award. But Peter may be overestimating the team's role in the future success of Ageless Vigor and Vigor Skin Care as a whole. It may already be too late to save the team; the manufacturing prob- lems that are emerging reflect the need for other solutions.

Leaders need to watch carefully for cues that a team member has disen- gaged from a project, and they should build in precautions. For instance, Peter might have intervened sooner and pre- vented Sandy from burning out on the job by giving her a break or by getting her some backup support. Sandy also needs to accept some responsibility for pacing herself and managing the stress; she could have alerted Peter if she thought she needed more help. Now, Sandy's corporate bumout may be too far along to reverse quickly enough for the second phase of Ageless Vigor.

Meanwhile, Josh is on a different tra- jectory-his attention is already di- verted. And his personality doesn't seem suited to the predictable routines that Vigor has settled into. Having another Josh "in the wings" is unrealistic, so Peter should have anticipated Josh's

eventual boredom with the project and set up ways to leverage Josh's contribu- tions after he'd moved on. Instead, Peter's inaction has left the Ageless Vigor project vulnerable.

Even if Sandy and Josh are still in- vested in the Ageless Vigor project, Peter should be asking himself if they have the skills necessary for the next stage in Vigor Skin Care's life cycle. The problems surfacing indicate that they don't Out-of stock products, unexpected costs and delays, and problems with sup- pliers-these are all predictable chal- lenges when a mature business markets new products. But they seem to be pil- ing up fast and could overwhelm Vigor's momentum.

Peter didn't anticipate these chal- lenges and didn't take appropriate cor- rective measures because he may have been unduly reliant on the team. If he had dedicated several cross-functional teams to manage the various processes involved in getting Ageless Vigor out the door, such as manufacturing and inventory, he might have fewer prob- lems now.

Rather than advise Peter to salvage the team, I would suggest that he reor- ganize Vigor Skin Care to include "inte- grators"-team leaders who oversee cross-functional work teams. These col-

laborative teams need to manage and coordinate the execution of business plans within the departments responsi- ble for end-to-end production of Vigor's products. By utilizing these work teams, Peter can energize his staff and encour- age others to take leadership roles. Peter will still need creative and strategic spe- cialists, so Sandy and Josh could serve as an internal board of advisers or as exec- utive sponsors.

Peter also needs to position Ageless Vigor as the vehicle and the platform for the company's rejuvenation of its prod- uct portfolio. The timing is perfect for launchingthis initiative-right after the award ceremony, while the project has high visibility and positive public re- gard. Peter's business plan should ex- pand Ageless Vigor's position as a strate- gically aggressive and highly resourced testing ground for product lines aimed at new or expanding customer groups. Not only is this a viable way to capture growing market share but it would also help Peter attract high-potential em- ployees across the company who are eager to benefit from the cross-poilina- tion that corporate headquarters is advocating.

In this way, Peter's rainmaking can have more impact than it did during his old days of closing a sale in the field.

JULY-AUGUST 2001 37

HBR CASE STUDY • Should This Team Be Saved?

"It doesn't require unusual insight to see that the problem at Vigor Skin Care is a problem of leadership combined with acute postgame depression/'

Martin Puris is the founder and former chairman ofthe Ammirati Puris Lintas advertising agency. He also founded New Things, a New York- based venture capital group focused on wireless start-ups. He is the author of Comeback: How Seven Straight-Shooting CEOs Tumed Around TYoubied Companies (Random House, 1999}.

Vigor Skin Care is in transition, but that shouldn't be cause for panic. Transitions aren't unusual, they're inevitable. The question is not whether you'll hit a few speed bumps but, rather, how well you'll handle them. While I certainly admire the fact that Peter is awake and sensitive to the ebb and fiow of his business, I'm not sure I admire his hair-trigger readi- ness to sack two ofthe three reasons for his brand's success: Sandy and Josh. Mind you, I am neither particularly sen- timental nor myopically loyal, and I admit to firing my share of people over the years. 1 simply believe in the value of great creative alliances with a convic- tion that borders on the religious.

When Peter landed at Vigor Skin Care, he was most fortunate to discover not one, but two enormously gifted partners. Reborn by Peter's arrival, Sandy and Josh became stars. Peter be- came the leader of a formidable team. And, by his own reckoning, that team collaborated to accomplish things that none of the three could have done on their own.

The Vigor team greeted each day vtfith fire in its eyes. Unaware (or unim- pressed) by all the things that couldn't be done, the team did them. Sandy kept the suits from headquarters at bay and functioned as Peter's alter ego. Josh pro-

vided the poetry, the creative leaps, the genius. As the group's leader, Peter found greatness, and he enabled Sandy and Josh to find it in themselves. How wonderful, how productive – and how very rare. Vigor Skin Care rose from the ashes. Four years of dramatic success, and now, facing a rough patch during the past two months, Peter unaccount- ably contemplates scrapping the "fear- some threesome."

It could just be that Peter is an acci- dental hero. In one revealing moment, he admits that he doesn't understand the mysterious formula that gives the Ageless Vigor team its magic. This lack of understanding could be Peter's fatal fiaw. While he ruminates covertly- choosing not to communicate his con- cems to his partners – Sandy and Josh revert to a pre-Peter-like boredom. Isn't that what talented people do when they're uninspired?

It doesn't require unusual insight to see that the problem at Vigor Skin Care is a problem of leadership combined with acute postgame depression. But this story doesn't have to have a gloomy ending. Peter already has many of the leadership qualities needed to head a formidable team-which are very dif- ferent from the more mundane man- agement techniques needed to merely

herd a mediocre group from quarter to quarter till death. His first four years at Vigor and his overall track record in business confirm that. He has proven that he has a keen eye for talent. He can galvanize disparate groups of talented people. He has encouraged creative thought and brought the great bogey- man-failure-down to size. He pro vided the dream that inspired the re- naissance of an entire company and encouraged the sort of vibrant environ- ment that allowed creativity to flourish. Ah, but what happens when the initial passions have been sated and the mis- sion has been accomplished? When both the dream and the enemy are un- clear, and when jobs threaten to become just "jobs?"

Sophisticated business management techniques aren't what's needed here. Peter's clear and present challenge is to go back to the well for more inspiration. If I were him, the first thing I'd do to- morrow moming is hang a sign on my office wall that says, "None of us is as smart as all of us are." When I'd finished hanging the sign, I'd pick up the phone and call Sandy to see if she'd bring around a couple of cups of coffee and Josh. Then I'd close the door, turn off the phone, and talk to them – for a very long time.

38 HARVARD BUSINESS REVIEW

H B R C A S E S T U D Y • Should This Team Be Saved?

"Peter needs to be more resourceful in developing the right mix of talents and skill sets to address Vigor Skin Care's changing priorities."

Jon R. Katzenbach is a founder ofKatzenbach Partners in New York, a firm specializing in leadership, team, and workforce performance. He is also a former director ofMcKinsey & Company. His most recent book is The Discipline of Teams (John Wiley & Sons, 2001).

Maybe the question isn't "Should this team be saved?" but rather "How can we ensure the right kind of team per- formance from here on?" While some may see Peter's group as an unlikely team, I think it is fairly typical of the kinds of teams seen in ventures, start- ups, and successful business-unit turn- arounds. Individuals succeed in teams because there is a compelling and fo- cused turnaround challenge, not some mystical chemistry or buming desire to work together. The individuals perform as a team because it is often the only way to get the job done. Unfortunately, after the Vigor team conquered its ini- tial turnaround challenge, a different set of problems emerged. Unless Peter changes his leadership approach to re- fiect those new challenges, he will find he no longer has the right kind of team for the job.

Of course, Peter could apply the "ChainsawAr'principIe of replacing his current team with an entirely new one. But that simply wastes talent at a time when there is little to waste. Far better to recognize that a challenge that was best attacked by one small group now probably requires multiple problem- solving efforts-by different kinds of teams as well as nonteams. Peter should focus attention on four things.

First, he needs to redefine Vigor Skin Care's performance objective, it can no longer be effectively addressed as a fo-

cused tumaround task for three people. Leadership groups that excel at team performance consciously break their tasks and priorities into two groups: those that require a single-leader perfor- mance discipline and those that require a real-team performance discipline.

The single-leader discipline means one clear leader holds each member individually accountable for assigned tasks and expected results. The real- team discipline means the team collec- tively establishes its tasks and expected results, and all the members hold them- selves mutually accountable. Most im- portant, in the real-team discipline the leadership role can shift depending on the task at hand. For instance, if Peter's group had practiced the real-team disci- pline, Sandy would have assumed the leadership role when the group was grappling with a marketing problem. Peter would have temporarily become a working member ofthe team, without relinquishing his formal authority. Both the single-leader and real-team disci- plines are important for balanced lead- ership performance.

Second, Peter needs to find people who can bring additional skills to the leadership group. The fearsome three- some no longer has all the capabilities Peter needs. And it may be that Josh or Sandy could make better use of their skills elsewhere in the company. That doesn't necessarily mean that either or

both of them cannot still be valuable to Peter, but he will need additional per- spectives from other team members as well. The fearsome threesome needs to open itself up to a larger talent pool.

Third, Peter needs to use flexible con- figurations of subgroups. Just as the company's performance challenge now needs to be redefined, so must its teams' efforts be realigned aroimd this new challenge. Today's dynamic business world invariably cries out for subteams and other

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