In the previous blog, “Achieving Financial Goals and Success Through Teamwork,” my colleague, Stephen Wagner, described what is a common model in most, if not all, retail operations, and it is the most prevalent operation model in the fast food and casual dining business.Achieving Financial Goals and Success Through Teamwork,” my colleague, Stephen Wagner, described what is a common model in most, if not all, retail operations, and it is the most prevalent operation model in the fast food and casual dining business.

Most retail operators divide their market into regions. Each region is then divided into zones which are composed of a number of retail units, i.e. restaurants, stores, etc. There is often a COO (Chief Operating Officer) who is held accountable by the CEO (Chief Executive Officer) for the overall results of the retail operation. The COO’s metrics are, in many cases, reviewed weekly, if not daily. Reporting to a COO, there may be many Senior VPs of Operations who are held accountable for the retail performance results of a large area of the country—for example, the West, Midwest, Northeast, and South regions in the United States. These Senior VPs may have several Regional VPs who themselves have Zone Managers and each Zone Manager is held accountable for the results achieved by the stores or units within their zone.

As a Store Manager, Stephen was a member of a group who reported to the equivalent of a Zone Manager, and he was also the leader of his team at the store. The criteria I use to differentiate between a team versus a group of individual contributors are based upon the presence of the following elements:

Common Goals: The group or unit has to have a set of goals that are clear to all—and they have to be quantifiable and easy to measure and be achievable through the collective effort of the group members.

Rewards and Recognition: Rewards and recognition need to be heavily focused based upon the results achieved by the collective effort.

Interdependency: The collective effort is based upon the model that “the action of one member of the group has an implicit and explicit impact on the actions and results of the effort made by the others in the group.”

Clarity of Roles and Role Flexibility: The roles need to be clear and understood by all members. At the same time, those roles also need to be flexible for any group member—so if a situation requires it, any group member can step out of his or her role to support or play a different role which, if not covered, could have a negative effect on the results of the group.

Trust Building: The group needs to have time for team practice, team feedback, team training, and team conflict resolution and negotiation in order to maintain and improve team performance.

If a group is missing any of these elements, then the group is not a team.

In Stephen’s case, the “management“ team is not a team; it is a group of managers who, by structure, report to the same boss whose performance is assessed based upon the individual managers in his or her zone. Furthermore, his or her bonus structure is heavily weighted (i.e. 70% and up) to the cumulative results of the store or unit managers. These members of the same group meet once every month in order to review the performance/metrics of the zone and during those meetings, most likely, the performance of each store is discussed which sets a climate of competition among the different managers. The bonus structure encourages them to focus on their store’s success but, given the proximity of other stores, it is at the expense of another store’s potential success. In this group, the roles are very clear. They all know that they are Store Managers reporting to a Zone Manager and that they are responsible for traffic into their store as well as for revenue, consistency of product, retention/loyalty of customers, and all the metrics that the company uses to assess store performance. Their role is not flexible—a Store Manager cannot spontaneously leave his or her store in order in order to help another store that is having problems.

Interdependence is minimum or nonexistent. The action of one does not directly affect the actions of others. The relationships are not of a collaborative nature but are competitive—by improving their own store’s service, they may attract traffic that typically shops in one of the other stores. The nature of the group is one in which each individual is more focused on their individual store’s performance. There is no time or interest to focus on building trust or relationships, addressing problems, sharing opportunities, or, to a greater degree, helping each other. This is a group of individual contributors who report to the same Zone Manager—it is not a team.

As to the “store level” team that Stephen refers to, they have a common set of objectives or goals that they have to achieve by working interdependently and whereby the actions of one affects the actions of others. For example, a cook in the kitchen who is too slow affects the timely delivery of the meal by the server which, in turn, creates a dissatisfied customer who may not return to the store—and that reduces store retention and affects revenue. The rest of the aforementioned criteria are met by the nature and dynamics of the group and the roles are clear and flexible—working together allows them time to build trust and relationships as well as learn from each other.

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