Unlock the Potential of Teams for Lasting Business Transformation

Four practical steps to team empowerment

Transforming large, complex systems requires a unit-by-unit strategy. Each leadership team must develop its own change process aligned with the organization's overall strategy and values. Teams need to have honest conversations about their performance barriers and determine how to overcome them. Once accountability benchmarks are established, unit leaders can effectively propel change and foster high performance within their specific contexts.

With operational agility at the team level in place, leaders can take four actions to unleash team potential: identify the highest-value teams, activate the teams, lift leaders to support their teams, and scale this approach. Let's explore each of these steps in detail.

Identify the highest-value teams

Leaders know that transforming companies through teams requires identifying those that can deliver the greatest business value aligned with the transformation agenda. Some teams will increase revenue in the short term, while others will take longer to realize their potential. But all are tied to the organization's identity and purpose.

For example, a pharmaceutical company faced a revenue drop as its bestselling medicines lost exclusivity. It prioritized its 40 product teams by looking at its future pipeline and identifying the handful with the highest chance of yielding revenue or successful development milestones in the next two to three years. The bank, a leading Asian bank, embarked on a transformation by identifying and prioritizing high-value teams. Its goal was to create a horizontal organization with teams capable of rapid adaptation and innovation. By focusing on its 50 most critical teams, including the group executive committee and certain country leadership teams, the bank made early progress in shifting its culture.

Activate the teams

Activating value-creating teams requires empowering them with a clear mandate, aligning them around clear outcomes, and agreeing on how to execute together. A global life sciences company gave teams expanded powers to set their own direction and make decisions. By immersing each intact team in a two-day session and involving a broader range of stakeholders, the teams gained a greater sense of ownership and commitment.

After clarifying the value they could create for stakeholders and setting measurable results, teams began to focus on more value-added endeavors. The shift to engaging a broader set of stakeholders also improved trust and collaboration. For example, legal colleagues better understood team goals and could prioritize requests. This shared understanding led to a higher team metabolism with experimentation and innovation becoming a core mindset.

Lift the leaders to support their teams

Teams need leaders, and leaders' behavior can make or break a team's performance transformation. McKinsey research shows that change leaders should move beyond traditional skills to inspire purpose, set medium-term strategy and long-term vision, and remove obstacles. At the global life sciences company, leaders became guides rather than directors, setting strategic visions and enlarging their spans of control.

As more teams get involved, senior leaders can act as connectors and communicate successes to boost energy. They can also sponsor customer-centric teams and help remove obstacles. In one case, a leader removed a blockage for a team experiencing pushback. Embracing a growth mindset is crucial for leaders in this context.

Scale this approach to more and more teams

To spur transformation at scale, new ways of working must extend to all value-creating teams. The global oil and gas services and equipment company expanded by creating a network of "culture transformation change agents." These agents carried new ways of working to all parts of the organization and shared success stories.

The global life sciences company scaled its approach by bringing in teams that interacted regularly with the first phase of teams. Having a sufficient number of team coaches is critical. Training coaches through a "see one, do one, teach one" model and specific "train the trainer" sessions takes time. Leaders can measure impact by tracking metrics and sharing success stories to show the organization's commitment.

Finally, to operationalize agility at the team level, the organization must evolve at a systemic level. When the organization offers a clear shared purpose and direction, teams can quickly form, disband, and reform to address new priorities.

Teams are often overlooked as the engine of organizational transformation. By investing in high-performing teams, organizations can create lasting change that benefits the entire enterprise. The examples shared here demonstrate how focusing on teams can lead to breakthrough performance, foster innovation, and build organizational resilience.