Why Small Team Collaboration Usually Beats Larger Groups

You may have heard of Amazon CEO Jeff Bezos' famous "two pizza rule"—if a team can't be fed by two pizzas, that team is too big.

It’s tempting to think that adding more people is the silver bullet that will solve all your problems. After all, the more people assigned to a project, the faster it will be completed, right?

Think again—and don’t post that new job opening just yet.

Studies are piling up showing that adding more team members may actually hinder team productivity overall. In fact, there’s a growing consensus among business professionals that five to eight member teams maximize employees' potential. This small number leads to more engagement, accountability, and productivity.

This rule not only apply to team sizes. It also serves as a helpful guideline for increasing productivity in meetings and strengthening manager-employee relationships.

Why exactly are small teams so much more effective? And what concrete techniques can leaders use to capture the benefits of a smaller-is-better approach to teamwork? Here’s what the research has to say.

Why (team) size matters

The logic of small team collaboration is that the fewer people working together, the less bureaucracy gets in the way. In simpler terms, fewer moving pieces equals more efficiency. Following are several benefits of smaller teams.

Increased engagement

In his aptly titled article for Forbes, Why Smaller Teams Are Better Than Larger Ones, Jacob Morgan writes that employees are more engaged and satisfied with their output when working in small teams.

Small teams prevent "social loafing," where individual contributions are perceived to be less valuable, because of the number of people sharing the same task. This is the idea that "individual effort decreases as the team size increases." But perhaps it is more helpful to think of its converse—that individual effort increases as the team size decreases.

Take the results of Gallup's 2013 report on The State of the American Workplace. Companies with fewer than 10 employees scored engagement levels of 42 percent, whereas the average engagement level for bigger companies was below 30 percent.

The same goes for team sizes within larger companies. Teams with "five to nine employees have relatively higher engagement compared with teams of ten or more employees."

The benefits of increased engagement alone are astounding. The same Gallup report found that workers who care about their output garner higher customer ratings, profitability, and productivity and have fewer safety incidents and lower absenteeism.

More effective communication

It should come as no surprise that it's easier to keep in touch with a smaller group of people than a larger one. (Imagine having to follow your entire graduating class on Facebook instead of just your closest friends). In small team collaboration, not only do you have fewer people to keep track of, but you're more aware of each person's responsibilities and how your own work fits in.

This is the idea of "link management," a concept introduced by Harvard Psychology professor J. Richard Hackman. He explains, "as a team gets bigger, the number of links that need to be managed among members goes up at an accelerating, almost exponential rate. It’s managing the links between members that gets teams into trouble. My rule of thumb is no double digits."

In other words, the larger the team, the more difficult it is for members to communicate with each other and check on one another's progress, and the more muddled and chaotic the project can become. This is perhaps why Hackman ends up saying, "Big teams usually wind up just wasting everybody’s time."

More innovation (and more productive meetings!)

Just as small team collaboration leads to better communication, they’re also believed to prevent groupthink. The failure to critically evaluate ideas, as one Fast Company article summarizes, "is more likely to occur with large, centralized teams." In contrast, employees in small teams are more likely to voice their own opinions, challenge those of others, and ultimately make better, more thought-out decisions.

When teams grow too large, employees' independence and innovation suffers. As Neil Christie writes, "limiting dysfunctional decision-making and being discerning about how and where communication is needed would be beneficial to all."

To counteract this, try scheduling smaller meetings, with only essential personnel. Participants in smaller meetings are less likely to "go with the flow" and more likely to voice individual ideas, feel more included in the process, and thus feel more engaged.

Stronger support network and collaboration

Psychologist and professor of management Jennifer Mueller coined the term "relational loss" in her study "Why Individuals in Larger Teams Perform Worse." Relational loss occurs when "an employee perceives that support is less available in the team as team size increases."

This perceived loss of support comes not only from fellow team members, but also from team managers, who are responsible for evaluating and/or coaching large groups of people. Simply put, the larger the group, the less individual attention that can be passed out.

On the other hand, smaller teams, by providing more perceived support, are further able to "buffer stressful experiences and promote performance."

And so much more...

Smaller teams allow for greater accountability, autonomy, and flexibility, both in terms of scheduling- and idea-based changes. They "foster greater trust among team members and less fear of failure."

They also tend to outperform larger teams. For instance, researchers Staats, Milkman, and Fox conducted a study in which teams of two and teams of four were tasked with building a Lego structure. The results? The two-person team completed the Lego structure in 36 percent less time, even though the four-person team was almost twice as optimistic about outperforming the smaller team.

As Neil Christie observes, "Larger teams breed overconfidence and underperformance."

Big-time tips for small-team managers

So you've split your teams into groups of five to eight. Now you can just sit back and watch that productivity graph soar, right?

Wrong.

Gallup found that "managers continue to be the most powerful influence on workers’ engagement levels."

And seeing as "managers with larger teams have a bigger challenge when it comes to engaging their employees," it's in everyone's best interest to keep teams small.

Johanna Rothman, of the Rothman Consulting Group, writes that even experienced managers should not be responsible for more than nine employees. Any more than that, and you threaten your ability to make meaningful relationships with your team members.

She recommends scheduling one-on-one meetings, weekly or bi-weekly, with every team member. This  builds a "trusting relationship" and to offer coaching to any who needs it.

Also schedule weekly "community of practice" meetings. Most people want to learn. They will appreciate meetings where the primary objective is to develop skills, whether those are technical skills, project management techniques, or other areas that cater to employee interest.

Provide people with routes to information, especially if you can't solve their problems yourself. Rothman gathered project reports from each team member and emailed that information to the team.

And make sure that "the right people are invited to the right meetings." There's no use in wasting people's time, including your own. If someone would benefit from attending a meeting, send her. If not, let her spend her time productively.

Though you may be "the boss," you are not the sole source of knowledge. Your ultimate responsibility lies in "creating an environment in which everyone can do their best work."

My company can't function in five to eight person teams. Is there any way to benefit from these ideas?

The short answer: yes! In a follow-up to his Forbes article, Jacob Morgan provides tactics that companies can use to remain productive and engaged, even if their teams aren't two-pizza sized.

Invest in collaborative technologies: (ahem, I would recommend one in particular?) Internal social networks keep employees connected, foster a flexible work environment, and value individual contributions. All of these make employees more engaged and give employers insight into how their teams best operate.

Strive for visible objectives. "At Morningstar Farms... employees create Colleague Letters of Understanding (CLOU), which is a personal mission statement for how the employee will help the organization including performance metrics. This CLOU is how employees hold each other accountable for various projects since they have complete visibility into each other's goals, objectives, and performance metrics." What's more, employees cannot "hide behind ambiguity" or engage in social loafing.

Provide autonomy by tracking output rather than hours. This one is simple—don't micro-manage. As Morgan writes, "the role of managers is simply to help employees understand where the company needs to go, but how the company gets there is up to the employees."

Challenge outdated management practices. "The best thing that organizations can do to continuously improve engagement and productivity is to evaluate and test common assumptions around how work is currently being done." This can take the form of abolishing annual employee reviews in favor of regular check-ins (Adobe), dissolving managerial positions and making all employees leaders (Whirlpool), or even budgeting for employees to take "an interesting person" out for coffee (LinkedIn). The team at Todoist receives a $50/month educational stipend. Point being, by challenging conventions, you can often find new ways to promote productivity and engagement.

Sizing up (or rather, sizing down) small teams

With increased engagement, innovation, and productivity, the advantages of slimming down your companies' teams should be clear. By trying some of the above management techniques, you can make everyone's lives much less stressful.

You want employees (and managers) you can rely on, so why not maximize their potential to do just that?

Ultimately, of course, it comes down to what works best for your company. How many people do you need to work on a single project? Who do they need to communicate with? How much autonomy should they have?

Depending on how happy you are with the company's productivity, it may be worthwhile to make some changes. Consider starting with smaller teams, smaller meetings, or have managers responsible for smaller groups.

I'm just suggesting you buy two pizzas, invite five to eight people, and let the ideas flow.