h&o+in+teams final

8/12/2019 H&O+in+Teams final

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1. Introduction

Ever since there have been human beings, there have been hierarchies. The Ancient Greeks

and even the Neanderthal had hierarchic structures within their societies. In a group of

people there always evolves somebody who has the ambition to lead the group, whereas

others are happy to receive guidance and stay in the background. r to say it with other

words! some people are natural born leaders and others are followers.

Alongside with these group structures"hierarchies come opportunism, since people care

usually more about their own interest"well#being than about the interest of the group,

according to the $homo oeconomicus% model &Nell ' (ufeld )**+, p.-. Therefore, there is

always the danger that either the leader abuses his power to his advantage or a group

member reduces his effort in the shadow of the others. This opportunistic behavior could be

observed and is spread in any culture all over the world and there have been many differentways and approaches to deal with this problem ever since. owever, being around for such

a long period of time proves the difficulty of the problem and makes it necessary, especially

for economists, to find solutions for the phenomenon of opportunism in groups"teams. /oth,

opportunism from the leader perspective and from the team member perspective, have to be

restricted or even better totally eliminated.

0irst and foremost the leader of a team has the responsibility to control, identify and deal

with opportunistic behavior in the team with the help of his authority and therefore, the 1uality

of the leader is decisive for the success of the undertaking. e has to possess certain

characteristics in order to provide good leadership and control his team, since only a

respected leader will be able to lead his team successfully.

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Research question

2o two 1uestions arise, the first being! how can the team leader avoid or minimi3e

opportunism in teams4 5ogically following after this 1uestion, the second 1uestion to be

answered is! what does it take to be a good leader4

Aim

This paper6s aim is to find an answer to both 1uestions and to provide general information

about hierarchic structures and the different roles within a hierarchy. 0urthermore, it will

present solution approaches to opportunism in teams based on the team leader and with the

help of the military, point out what attributes a good leader has to have in order to deal

successfully with opportunistic behavior. /ecause of the limited scope of this work, the focus

of the paper will lie on the opportunism of the team members and on the things the team

leader can do to avoid opportunistic behavior. After reading this paper, it should be clear that

only a good and strong leader has the power to fight opportunism in teams effectively and

that leadership, control and incentives play a decisive role in avoiding opportunistic behavior

amongst team members. 0urthermore, the paper will show that the form of hierarchy is also

of importance when it comes to opportunism.

Structure

This paper will start off with providing general definitions of the terms $hierarchy%, $authority%,

$opportunism% and $team% in order to give an overview and basic information about the topic.0ollowing this point, some basic theory about hierarchic structures and roles within such a

hierarchy will be presented as well as an e7planation of the 8rincipal#Agent problems. The

ne7t chapter shows how opportunism in teams can be avoided or at least be minimi3ed with

the help of good leadership, control and incentives. The term leadership will hereby be

scrutini3ed more in detail by looking at the different styles, skills and tasks of a leader. To

round up the paper, an e7periment from the 9ournal of Economic /ehavior ' rgani3ation

will serve as an e7ample to cast light on the influence of a leader and prove how leadership,

authority, control and incentives help to reduce opportunistic behavior in teams. 0inally, the

conclusion will then sum up the ma:or findings and predict some future research potential.

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2. Definitions

This chapter will give some basic definitions in order to clarify the most important terms of

this work, which are inevitable for the understanding of the paper.

2.1 Hierarchy & Authority

ierarchy describes an organi3ational structure where every entity is subordinate to one or

more entities. In a conte7t of social systems, hierarchy is often connected with power and

authority, but also operational structures including corporations, the church, the military and

governments, are hierarchically arranged &Anonymus )**;, p.ho

leads, needs authority because authority means accompaniment. In order to e7ert authority,

one has to possess authority. Authority includes, besides the regard for a human and theweight you accord to his personality, the disposal he assumes. There are three types of

authority, but real authority is a mi7 of all of them!


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2.2 Opportunism

There e7ist many different forms and fields of opportunism. There is political, biological,

social and economic opportunism, to :ust name a few of them. This paper puts focus on the

aspect of the economic opportunism. It is neither easy nor clear to determine what economic

opportunism is. According to the American economist liver >illiamson there may be

$growing agreement that bounded rationality is the appropriate cognitive assumption for

describing economic organi3ation%, but only little agreement on how selfish behavior of

economic actors should be described &>illiamson


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environment. The structure of the team is aligned in order to ensure task and goal oriented

work and is designed for a periodic review of efficiency &Fabey ' @aird ahren


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3. Theory

In order to fully understand the purpose and aim of the topic, it is necessary to take a closer

look at the processes and structures of groups as well as the behavior within such groups.

0urthermore, the 8rincipal#Agent#problems will cast light on the ma:or problems arising

within the conte7t of hierarchies and opportunism in teams.

3.1 rocesses and structures in !roups

3.1.1 "roup si#e

Two persons form a pair and three form a group. The smallest form of a group is generally

accepted. Fore difficult to define is the upper limit of members that still can be named a

group. That sub:ect is controversial discussed in the literature. A group si3e from )* to )C is

often perceived as the ma7imum. 2ince the si3e of a group depends on various factors such

as, communication behavior, communication habit ' ability and volume of work. ence a

definition of a general upper limit is not reasonable.

According to this 1uote $Has many members as needed, as few as possibleH by iegler in

)**), a general principle to find the optimal group si3e is!

$i!ure 1% "roup si#e and communication eha'ior

2ource! osenstiel


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Another approach is used in the determination of class si3es. As a conse1uence of the

findings of GI// ' /A22 one would suggest the bigger the group the more inefficient.

Thereby, we disregard the positive effects of increasing group si3e.

The 8eer effect, namely Jthe output of individual i increases when the output of : increases

and nothing else changes% &0alk ' Ichino )**+, p.=-. In other words the individual output

increases when the group si3e enlarges ceteris paribus.

0igure ) shows a slow ascend of the overall group performance through the positive peer

effect until a ma7imum of


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Now we modify the e7periment and form two groups as indicated in figure ). 8erformance

class < consists of superior pupils and performance class ) of less talented pupils. ?ue to a

fast comprehension the coaching effect for class < is diminishing slower than for class ).

Also the peer effect for class < is increasing steadily and over a longer period than class )6s

peer effect to an optimal class si3e of ). 2umming up the two effects for every group, the

result is a bigger optimal class si3e for performance class < than for class ).

>e conclude that the optimal group si3e does also depend on the composition of the group

members and their level of skills.

Nevertheless certain general distinctions between groups should be made. In $work#groups%

the number of members is set regarding the 1uestion! $ow many workers do I need to fulfill

the work in an economic way4% 2ince the work#aspect gets more relevant, communication

moves to the background. The results are bigger groups with a risk of splitting up in sub#

groups &)*K- due to handicapped communication.

n the other hand, in $problem#solving#groups%, the individual ideas of all team members get

more important. igh density of communication and e7change of ideas allow a group#si3e of

five to nine persons &>ahren


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develop functioning standards, distributing the roles and create a sense of unity. nce the

team work functions efficient thanks to good pro:ect communication and focus on the work,

the average performance rests constant. After ).C#.C years the group reaches another

stage where the team has the tendency to lose his efficiency of labor. The causes are mainly

encapsulation from the environment and the drive to entertain themselves. A replacement of

the workers is recommended to avoid similar record.

$i!ure *% "roup cooperation o'er time

2ource! osenstiel ahren


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3.1.3 "roup dynamics

>hy and how groups change over time through individual behavior that influences the

actions of other team members is the goal of research in field of group dynamics. The most

popular theory of group dynamics was developed by the psychologist Tuckman /.>. In


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;.2tage! 8erforming

2ome teams reach the last high#performing stage. 2ince the interpersonal differences,

hori3ontal and vertical, are solved every member works with his abilities towards the

common goal. They function as a unit and get the :ob done in an effective and smooth way

without inappropriate conflict. The team members are now competent and focused on the

main task.

>ith every new task or personal e7change all these four stages must be cycled through

anew. No stage is evitable. If one stage is ignored he has to be repeated later on. Indeed in

e7perienced teams certain stages pass faster and easier but they are not avoidable. Actually

it6s a good idea to recruit new members so that new ideas and dynamism refresh the group.

In principle team development is not enforceable. The only assistance a supervisor can give

is to support them. 0urthermore you have to be aware of that a high performing team put into

practice is another matter entirely. Fany teams will never develop past the second stage. It

demands for patience, understanding and time of every individual. The better the

identification with the team the more successful works the whole group. &iegler )**),

pp.ilfred uprecht

/ion. e identified three basic assumptions that affect the actions and behavior of team

members in different group stages. &Neuberger )**), p.;


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. /asic assumption! 8airing

The development of the group is fro3en by a hope of being rescued by two members. The

two team members form an ally in order to create something new through their continued

interaction. The remaining group members listen eagerly and attentively with a sense of

relief and hopeful anticipation. &/ion )**


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personality types and it6s out coming performance. /ased on the assumption that the

personality profile of a person is a combination of varying characteristics, he analy3ed results

of teamwork from students &enley Fanagement @ollege- and identified through out eight

different team roles, which resulted from individual behavior manners of each members.

/elbin took these eight different roles and created in hile he tends to ignore details and negligibility, he risks some careless

mistakes. In addition, he has difficulties to take constructive criticism.

App)ication! 8lants should focus on their high potential for problem solving and the ability to

develop new strategies, but taking into account the ideas of other team members as well.

Resource In'esti!ator% The pioneer

,haracteristics! The esource Investigator is e7trovert, enthusiastic and communicative.

e has no difficulties to find friends and he is sociable.

Stren!ths! It is easy for him to establish useful contacts members and sources outside the

team and to use them. 0urthermore, he has a talent to finds new ways and alternative

solutions.

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/ea0nesses! esource Investigators are often too optimistic and can easily lose interest.

They also tend to deal with irrelevancies, so they may digress from the core issue.

App)ication! esource Investigators should maintain contacts with the world outside the

team and intensively use them for its team performance.

,oordinator% The inte!rator

,haracteristics! The @oordinator is confident, decisive and strong communicative and a

good listener.

Stren!ths! e coordinates the work process, sets goals and priorities recogni3e relevant

issues and delegates tasks to those colleagues who are suitable to accomplish them best.

e shall ensure compliance with e7ternal target and timing.

/ea0nesses! Faybe his colleagues see him as a manipulator. This may mean that they

move away from him especially on a personal level. This feeling is e7acerbated by the fact

that he tends to delegate personal duties as well.

App)ication! 8eople with characteristics of a @oordinator should be used as a team leader,

whose duty is to coordinate and allocate.

Shaper% The ma0er

,haracteristics! The Faker is dynamic, energetic and constantly under pressure, he re:ects

vague and imprecise information and statements and focuses on the essential core

problems.Stren!ths! e challenges his colleagues and 1uickly takes over the responsibility. e

formulates sub goals, e7plores issues, provides for rapid decision#making and causes tasks

to be done immediately.

/ea0nesses! 2haper prone to provocation and get easily into a dispute with her

teammates, but are not resentful. In particular they are perceived by e7ternal observers to be

arrogant. Also, they cause through their hectic appearance an7iety within the team.

App)ication! 2hapers do feel comfortable in a team of e1uated peers. As soon as they have

to take a leadership position, where monitoring and coordination are necessary, it6s :ust this

type of role who needs a high degree of self#discipline. ere again the concentration on

strengths and benefits are reasonable.

onitor 'a)uator% The oser'er

,haracteristics! The Fonitor Evaluator is sober, strategic and analytical. e gives himself a

good view from a distance, is more introverted and rarely takes the parole.

Stren!ths! The Fonitor Evaluator takes into account all relevant facilities and has good

:udgment.

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/ea0nesses! e is due to a lack of enthusiasm hardly in a position to motivate others,

tends to lose interest after getting some criticism from teammates and can totally be

perceived as insensitive and condescending.

App)ication! The Fonitor Evaluator should make sure that his opinion is heard. This is

achieved by trying to be less cynical and skeptical.

Team or0er% The teammate

,haracteristics! Team workers are likable, popular, communicative and diplomatic. They

often know the personal backgrounds of their colleagues.

Stren!ths! They provide a pleasant working environment and harmony, so they can be

referred as Hsocial soulH of the team. Team workers avoid rivalry and have the ability to

motivate even introverted colleagues to participate more actively.

/ea0nesses! They are undecided in critical situations and tend to leave decisions to others.

App)ication! The presence of Team workers is significant, especially in conflict situations,

because they can use their diplomatic skills to solve any disagreements. They often help out

from the background and are responsible for the contribution of social services.

Imp)ementor% The con'erter

,haracteristics! The Implementor is reliable, conservative and disciplined. e works

efficiently, systematically and methodically.

Stren!ths! Implementors put concepts into workable plans of work, need stable structuresand work well in their construction.

/ea0nesses! They are critical to environmental changes and respond to new solutions

often infle7ible.

App)ication! Implementors should be responsible for defining clear ob:ectives, practical

approaches and structuring of procedure.

,omp)eter% The perfectionist

,haracteristics! The @ompleter is a perfectionist, precise, punctual, dependable and

an7ious.

Stren!ths! e avoids errors and ensures precise adherence to timelines and also pays

attention to details.

/ea0nesses! ut of fear that something could have been overlooked, reviewed or

inspected, he uses to do something personally rather to delegate. e is often too an7ious, so

he tends to lose the overview.

App)ication! @ompleter make an important contribution, especially when the team is in

danger of working too superficial or when timelines have to be observed.

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Specia)ist&the ninth role, who was added as additional character-!

,haracteristics! The 2pecialist is self#centered, committed and focused on the technical,

professional part of a task. e has e7tensive e7pertise, background and skills, which is

missed by the other team members.

Stren!ths! e formulates general statements about the technical issues and provides a

professional contribution to the team task.

/ea0nesses! 2pecialist tends to get lost in technical details and therefore make only more

informative articles.

App)ication! The role of a 2pecialist is to compensate the lack of information within the team

and to contribute with his necessary e7pertise.

/elbins model helps to form good cooperating teams and to understand their effective

teamwork for a big variety in >estern applications. The purpose of his approach is the

development of a team building process, which allows making simple predictions of future

team performances. This is to succeed by trying to put people into different categories. In

fact it6s considered that boundaries between these respective roles are fluently and one

person can take multiple role profiles as well. /y fulfilling self#assessment and through

subse1uent feedback from e7perienced independent observers, a member of a team can

receive some input about his own strengths and weaknesses. It allows each member to find

out how his contribution fits better into the team and helps to increase his motivation for a

more optimi3ed use of their personal skills &/elbin


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/oth parties act rational and try to ma7imi3e their individual benefit &omo

economicus- &GMbel )**), p.


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idden information! The principal has the possibility to observe the actions of the agent,

but not to the full e7tent, since the agent has special knowledge that the principal

himself does not have. This makes it difficult for the principal to observe and control the

agent, because he has a lack of knowledge regarding the tasks of the agent. This may

seduce the agent to direct his actions towards an increase of his own benefits. An

e7ample for such a situation could take place at a garage. The costumer is able to

watch the mechanic6s work, but he does not know for sure if all the repairing is really

necessary, because of his lack of technical knowledge &GMbel )**), p.ho wants

to lead needs authority, because it is the prere1uisite for loyalty of subordinates and it

includes the reputation that others feel for a person, the weight toward the leader6s

personality and the power of control perceived by the leader. Authority is the basic tool for

influence and power. In order to use authority, it is necessary to possess it first. It6s the main

influence base.

*.1.1 Types

5eadership means! to guide people &individuals or groups- to a particular destination. It is

performed everywhere in the state, society, economy, military, family, etc. 5eading happens

also in many different ways. ?epending on which areas must be conducted, what goals are

aimed there for, who is leading who and in what kind of situations do we find ourselves. 2o

the leadership concept should be adapted to every of these criteria. 5eadership has to be

performed in different ways at once.

>e distinguish two types of management science!

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# 5eadership

# @orporate governance

5eadership

ere the human being as a guided ob:ect is in the foreground of this concept. In

$5eadership% the training of the future leader has to show skills and behaviors, which allow to

manage both, individuals and groups and how to influence them for an optimi3ed effect,

which helps to lead towards an aimed performance.

,orporate !o'ernance

The corporate governance refers to a steering system in which all leading forces of a

company are classified. It is therefore broader than managing people &leadership-. @orporate

governance includes the companys policy in the highest level &meaning and purpose of the

company-, all stages of implementation in the organi3ational field and management positions

in the persBonnel area. 5eadership can be understood as an integral part of corporate

governance &Anonymus )**;-.

Dimensions of )eadership eha'ior

A very common model is that of 0iedler. e cites no styles, but two dimensions of leadership

behavior that are independent of each other!

# Task orientation# Employee orientation

Ideally, a leader can integrate both dimensions in its leadership concept. According to

0iedler it is important to reali3e a situation of balance between tasks and employee driven

nature of the task. The employee orientated leadership is in the long run a fundamental

prere1uisite for success and should therefore always be considered. 2o it is clear that these

two dimensions should not be seen as an $either or% decision but as a form of leadership,

which contains both in it. To describe a particular style of leadership to be correct is absurd,

because task and employee orientated management dependent on the leader, the followers

and the specific situation. TE style of leadership does not e7ist

The emp)oyee orientation focuses its attention on all employees of an organi3ation. The

superior sees and treats employees primarily as people with personal needs, concerns,

worries, etc. e supports, encourages and looks after them in order to build and maintain a

good relationship with its staff.

In the tas0 orientationdimension the main attention lies on performance and employees

are in this look more or less seen as a means of service delivery. The primary concern is to

fulfill the order and to achieve the performance goal. The manager pays particular attention

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to the amount of work and generally re1uires high performance from all employees &ahn

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0indings related to authoritarian &7.1-, collaborative &7.7- and Hlaisse3 faireH &1.1- leadership

style!

The authoritarian run groups are more productive, while the leader is present. In the absence

of the leader, the performance in authoritarian groups decreases significantly stronger than

in collaborative led groups. The 1uality of work in democratically run groups is at the highest,

because the participants have a strong identification with their work. In authoritarian groups

there is often a disaffected and aggressive mood. Accordingly, the various styles of

leadership should be used in appropriate to the intended compound, as a good combination

and not isolated from each other. The manager should select those styles, which are suitable

for leading the respective group best. Important is to achieve the best possible alignment of

group#related leadership styles and to orient it towards the success &/astine


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communication very comple7. ence, it makes sense to keep the team si3e as small as

possible in order to control the group effectively.

0urthermore, a fair performance appraisal system is a good tool to control employees. >hen

it is clear what they have to do in order to receive their reward, people usually try to reach

that goal and act reasonable and comprehensible. This makes it easier to control them and

to lead them in the desired direction. To avoid opportunism, it is a good idea to make these

rewards as individual as possible, so nobody has an incentive to stop working as hard as his

other colleagues. Nonetheless, targets should be set difficult to reach to keep the team

motivated and ambitious, because a motivated team is easier to control than a team without

inspiration and drive &/ennis ' Nanus )*


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makes the other employees work harder, so ne7t time they will be praised in front of the

whole crowd. Therefore, recognition is a very effective and cheap tool to reward employees,

since it comes with no cost.

# @ontribution! The opportunity to work in a team and to work closely with managers and

management gives employees the feeling to be important and to contribute to the overall

success &@adwell )**;-.

E7amples for non#monetary rewards are amongst others certificates, congratulations from

the bosses, fle7ible schedules, a day off, health savings, recognition of birthdays, and free

lunches &(andula )**+, p.CB-. These non#monetary rewards are creating loyalty and respect

among the employees. It helps to bind the employees with the firm and increases the $family

feeling% more than monetary rewards would do. 0urthermore, it takes the breeding ground for

opportunistic behaviour and proves that not only money makes the working man happy.

Nevertheless, monetary rewards have also a right to e7ist and motivate people to work

harder.

onetary reards!

>hen speaking of monetary rewards, people often think it only means cash. @ash is of

course the most common reward in our world but there are also other ways of monetary

rewards, especially more effective ones when it comes to motivating people &The Incentive

0ederation )**C, p.;-. @ash includes the normal salary and also additional bonuses paidfor special achievements or targets. @oming close to these financial compensation methods

are stock options. That means the employees get shares of the company as incentives,

since it helps to bound and identify with the firm on the one side. n the other side it

increases the motivation of the employee to work hard in order to contribute to a higher

shareholder value of the enterprise, which makes the own shares more valuable. All these

financial incentives should be based ideally on the individual contribution of each employee

to the companyPs goals in order to be described as an effective financial reward system

&@adwell )**;-.

/esides these financial incentives, there e7ist also a lot of other monetary reward

possibilities. A common practice in this conte7t is the use of merchandise rewards. They also

help to enforce the bonding with the firm if the gift has a connection to the company. 2imilar

effects are generated by gift cards, certificates and e7perimental rewards, e.g. dinner at an

e7pensive restaurant, a vacation trip or tickets for a sports event. >hen thinking back at

these events, one will always remember who made the e7perience possible &(andula )**+,

pp.C+f-.

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0ringe benefits in contrast are benefits granted from the company on a voluntary level and

are available for the employee regardless of his performance. These perks have the

intention to increase the employee6s economic security and are therefore very much

appreciated by the workforce, especially since they are given for free by the employer, which

creates the feeling by the receiver to give something back in return. E7amples for such

benefits include &health- insurance, paid annual leave, provide housing or a car, retirement

plans, day care etc. &and ' Tarp )*


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the students formed groups of four members and everyone within the group got an

identification number from < to ;.Group members and their numbers were chosen by using a

randomly selecting procedure. ?uring these sessions it was not allowed to speak with each

other, e7cept through decisions they entered. Every round started with a simultaneously

choice of two actions! A &$work%- or / &$shirk%-. /y choosing option A members show their

willingness to contribute and to increase team performance. In a revenue#sharing team every

member got an e1ual share of the team output, no matter what their choice was. And in

leader#determined teams, the leader was informed about all decisions taken by its

teammates and had the power to came up with an own allocation plan of the team output.

The model of this e7perimental decision function is conve7, so all members must chose A

&$to work%- or / &$to shirk%- in order to attain an efficient result, but if all would decide to work

the output will become significant higher than by a collective shirk.

E1uilibrium under revenue#sharing

ere again it is important to keep in mind the supposition of standard game theory, which

says that everyone tries to ma7imi3e his own payoff. 2o having a team without a leader and

when output is shared e1ually, combined with a conve7 decision function, there are :ust two

possible results for e1uilibrium. All members will chose option A $work% or everyone will

decide for / $shirk%. And because the outcome of a member who shirks while the others of

the same team are working is bigger, it turns that / is the dominant strategy. This leads to

the uni1ue e1uilibrium, which is inefficient and the reason for a collective choice to free ride.

E1uilibrium under leader#determined sharing

In this institution the leader has the legitimate power to allocate the final output, but before

doing this all team members &also the leader- have to decide simultaneously in a first stage,

if they will A $work% or / $shirk%. The second stage represents the leaders sharing decision

and by using standard game theory again, it6s easy to understand that the leader6s incentive

is here to increase the own revenue. The fact that all members know that as well, they will

automatically chose to shirk in the ne7t round and so will the leader. Again the dominate

strategy for the whole team is / $to shirk% &Qan der ei:den et al. )**B-.

Resu)ts

The e7periment showed a significant result in relation to the institution and its output.

5eader#determined teams produced nearly the double amount of output than revenue#

sharing teams. They worked harder and with a much higher motivation. This makes clear

that the presence of a leader also enhances team performance from a welfare perspective,

so in the end it6s not only the leader, but also the other members of that team who benefit out

of this hierarchy structure. Installing a leader might help to produce more, but is not a

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sufficient condition for success. Important for a leader is to show respect towards his team

and to use his reward power in a fair way, by giving each worker his deserved revenue.

Given this behavior of the leader, all members are successful encouraged and have no

incentives to free ride anymore, because the final earnings are higher when they chose a

$work% than the alternative / $shirk%.

Incentives of free#riding are difficult to overcome in teams without a leader and where

revenue is divided e1ually. n the other side the leader#determined teams proved to be

more efficient in their performance, due to the strategy to share the output e1ually through

workers and giving nothing to shirkers. This strategy turns out to be a successful solution for

the best effort. Thus, an introduction of a leader can be understood as a significant

improvement of fair and efficient cooperation within a team. /ut again it6s important to keep

in mind that installing a leader is no guarantee for success. It6s not the availability of reward

power, but the way it is used by a leader &Qan der ei:den et al. )**B-.

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,onc)usion

>hen comple7 behavior in an interdisciplinary conte7t is re1uired, a team is needed instead.

The difficulty lies in the challenge to find leader who is capable to put the re1uired members

together and lead them towards a goal. is function is primarily to attend the group as an

e7pert during the different stages to a team. 2ince the development of the team follows a

certain pattern it is crucial for a good leader to encounter actively and direct the hostile and

contra productive atmosphere of the storming stage. nce the confidence at the leadership

and each other is built, open face to face and high fre1uency communication allows

reasonable treatment of conflicts and goal#related tasks.

/efore the actual team#forming process begins, the management already has to take certain

decisions with big impact on the characteristics of the team itself. ?oes the task re1uire big

work#groups or smaller problem#solving#groups4 >ho do I include into the group to achievean optimal heterogeneous mi7 of personality# and role#types4 Is it an open group or long

term cooperation4 nce the group is put together much of the actual team performance

depends on the 1uality of the leader. According to re1uirements and the circumstances a

different style of communication leads to the desired success. A charity organi3ation wont

survive long with a strong hierarchical structure. A friendly and rela7ed people#oriented

atmosphere is more suitable. n the other hand in stress situations and under time pressure

an authoritarian leadership is more appropriate.

Another crucial point for the success of the undertaking is the leader6s responsibility to

control, identify and deal with opportunistic behavior of his members. Therefor a good leader

has to fulfill a couple of basic tasks to guide his team in the right direction and to avoid

opportunism. Greater attention comes to the control aspect. To narrow down the room of

opportunistic behavior the leader informs his team in clear guidelines and ob:ectives about

every step it has to take. In order to control them, the leader itself has to have good task#

knowledge and the character of the individual team members. Thereby an increasing team#

si3e raises the personal re1uirements of the leader. is goal has to be, to create a team

spirit. ence better communication structures are necessary since the communication within

the group and individual appraisal#" reward#systems becomes more comple7. This adds a

new wrinkle to the general principle $as many members as needed, as few as possible%.

Especially in groups with a long#term cooperation the human aspect becomes more and

more important, since only a respected leader will be able to lead his team successfully. The

institutional authority loses relevance and the natural and functional abilities come to the

fore. Generally it can be said the better the identification with the team the more successful

works the group as whole. The individuals feel connected and in times of need they stand by

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each other. Fore and more it becomes clear that taking the responsibility over a group and

form them to a high performing team is a very comple7 task. The actual performance is

influenced by various aspects. The leader has to make the tradeoff between the

disadvantages and the benefits of each his decisions applied on the individual situation.

ften an optimal decision cant be found and depends on personal preferences and people

skills.

egarding the case study, future research could e7amine the effectiveness of leadership in

an environment with imperfect information. Another e7tension would be to study how

individuals in teams react to an ability based allocation of team output. Another interesting

research 1uestion would be to compare the group performance of teams with self#elected

leaders to teams with foreign, e7ogenous elected leaders. If a group would have the choice

to install a leader, would they do so and if yes, how do they find a general accepted leader4

h&o+in+teams final

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