Smaller, Flatter, Faster. Is The Two Pizza Team Finally Going Mainstream?

This weeks post looks at the two pizza team which was popularised by Jeff Bezos.

In the early days of Amazon he instituted a rule that every internal team should be small enough that it could be fed with two pizzas.
The goal was, like almost everything Amazon does, focused on two aims: efficiency and scalability.

Is it finally the time that our organisations will make the shift to smaller teams, not just because of financial savings, but because of their increased effectiveness and productivity?

Read the post by clicking the link. And if you like it I’d really appreciate a share on your social network of choice.

Have a great weekend!

Best wishes

Paul

The latest cartoon by Tom Fishburne seems to sum up what a lot of people are feeling right now. As he writes, “In a chaotic year, many brands and businesses are relying on adrenaline only. Organizations can only run on those fumes for so long. Adrenaline-based speed can lead to burnout.”

I’d argue that we are not seeing speed as much as lots of activity. Organisations are busy , sure , but it’s a reflexive response to an era in which they have no control over anything , even down to when and where people work. In organisational design terms – we are all still out there panic buying toilet rolls and hand sanitiser.

One of the issues here is that legacy organisations are not designed for speed, it’s just not what they do. Many people who have set up internal accelerators or innovation labs ultimately fail as they run up against hard wired bureaucracy and hierarchy purposefully designed to crush any ideas that threaten the status quo.

In their report , Reinventing the organisation for speed in the post COVID era , McKinsey note that CEOs recognize the need to shift from adrenaline-based speed during COVID-19 to speed by design for the long run.

It calls for work to speed up in three ways:

Sped up and delegated decision making.  This means fewer meetings and fewer decision makers in each meeting. They point out that some organisations are adopting a “nine on a videoconference” principle. (I’d suggest this is still a couple too many). Others are moving towards one to two-page documents rather than reports or lengthy PowerPoint decks.

Step up execution excellence. Just because the times are fraught does not mean that leaders need to tighten control and micromanage execution. Rather the opposite. Because conditions are so difficult, frontline employees need to take on more responsibility for execution, action, and collaboration.

Cultivate extraordinary partnerships. Working with partners is routine. But the speed of action only goes so far if other players in the ecosystem fail to move just as fast. The connected world is breaking down the traditional boundaries between buyers and suppliers, manufacturers and distributors, and employers and employees.

The building blocks at the base of all these things are , guess what, small empowered teams.

Is it finally the time that our organisations will make the shift to smaller teams, not just because of financial savings, but because of their increased effectiveness and productivity?

I’ve been an advocate of a the minimum viable team for a number of years. The concept of as few as people as possible – small enough to be fed on two pizzas, is attractive because it reduces social loafing and allows us to get off the hamster wheel of management and ‘work about work’. Once you’ve done it and moved away from managing lots of people it would take an almighty pay rise to tempt you back.

The Two Pizza Team was popularised by Jeff Bezos who in the early days of Amazon instituted a rule that every internal team should be small enough that it could be fed with two pizzas. The goal was, like almost everything Amazon does, focused on two aims: efficiency and scalability.

Its roots lie in the concept of the Minimum Viable Team which recognises that many companies spend an awfully long time thinking and planning to do something: longer than it takes to actually do the thing. It’s built on the premise of Parkinson’s Law – that work just expands to fill the time and resources available. The MVT idea is rather than layer on additional resources (that are ultimately wasteful) , you “starve” the team and make them pull only the necessary resources as and when they need them. 

Most organisations reserve this structure, if they use it at all, for either DevOps type environments or hipster design or innovation teams. However it has a sound evidence base – after devoting nearly 50 years to the study of team performance, the Harvard researcher J. Richard Hackman concluded that four to six is the optimal number of members for a project team and no work team should have more than 10 members.

How many project teams do you know that have four to six members?

Remote work exacerbates this problem. It’s hard enough to run productive in-person meetings with lots of people in the best of times, but trying to foster engaging discussions with lots of virtual participants is nearly impossible.

Despite the rhetoric of agile small teams – the shift won’t happen overnight as there’s a genuine question about what to do with all the people you might not need. I’d argue that post- COVID the immediate challenge is how we slow down to speed up.

We are in a new world with new challenges and we sometimes confuse operational speed (moving quickly) with strategic speed (reducing the time it takes to deliver value)—and the two concepts are very different. The more you can reduce organisational initiatives to a few key problems the more you can bridge the gap.

Do Fewer Things, Better. And Faster

No organisation, large or small, can manage more than five or six goals and priorities without becoming unfocused and ineffective, and it’s exactly the same for us as people.

The best organisations don’t try and do everything. They focus on a few differentiating capabilities — the things they do better than any other company.

This is not an either/or. IF we can reduce our priorities to a few key goals AND make small focussed teams the default way we operate , arguably we’d be a lot happier, healthier and more productive.


Photo by Erik Mclean on Unsplash

Why Small Teams Win

In the early days of Amazon, Jeff Bezos came up with a rule: every team should be small enough that it could be fed with two pizzas.

The ‘Two Pizza Rule’ signalled that Bezos didn’t want more talking, more line reports and more communication. He wanted a decentralised, even disorganised company where creativity and independence prevailed over groupthink and the bureaucracy of management.

A smaller team spends less time managing timetables and keeping people up to date, and more time doing what needs to be done.

These small teams promote autonomy but also a better approach to collaboration. Having lots of small teams means they all need to be able to work together and to be able to access the common resources of the company, in order to achieve their larger goals.

The thinking has precedence in things like Brooks’ Law – which states that “adding manpower to a late project makes it later.” Getting bigger often means your communication overheads grow and doesn’t necessarily yield faster results. As Brooks himself said: “Nine women can’t make a baby in one month.”

Thinking small also avoids ‘social loafing’  – which is where people take less accountability for individual and team performance when doing work as part of a group.

It’s human nature that some of us may take advantage of a situation in which it’s harder to pinpoint responsibility—a situation created by the fact that too many people have a role in the team’s performance.

When nobody’s noticing what you are or aren’t doing, the easier it is to keep doing nothing.

As a leader of a Two Pizza Team, I can firmly say that the high degree of “identifiability” means there is no room for anyone to hide – including me. Underperformance becomes apparent in days or even hours, not over weeks or months.

The Value of Small Teams in Change and Transformation

In many organisations, small teams are undervalued. Like introverts, they can often be overlooked.

Yesterday I facilitated a session for the regulator of social housing in the UK – and its theme was that in an age of big change (and arguably, big failure) – small distributed teams might be an answer to how we balance productivity and innovation.

Buurtzorg, the Dutch model of neighbourhood care started with an initial team of four. The system that evolved deploys teams of up to 12 nurses, who are responsible for about 60 people within a particular area. There are now around 900 teams in the Netherlands. This system balances small team thinking also whilst operating within a much larger framework.  The framework is what provides the scalability, the autonomous team provides the personalisation.

RSH Session (3)

Buurtzorg was very much an inspiration for our model of neighbourhood coaching – which again provides a framework for semi-autonomous small teams to bring solutions together around a community. It puts people at the centre – not housing ‘professionals’.

Visual

The Corporate Rebels have written about the Minimum Viable Team. Start small, get experience, grow bigger only when necessary.  I agree with this but also think there’s crossover with the points Chris Bolton makes in his post on Minimum Viable Transformation.

Most transformation programmes are about BIG ideas (and BIG language), where there is little room for failure.

Most approaches to organisational design are about BIG teams (and BIG resources) – despite no evidence linking these to productivity or innovation.

  • Maybe it’s time to think differently about how we solve complex problems rather than continue the endless annual cycle of calls for more resources and emergency injections of cash.
  • Maybe it’s time for smaller, more organised and better-connected teams to take centre stage.
  • Maybe it’s time to think about what minimum viable teams and minimum viable transformation look like and apply them in practical settings.

At the end of the day, radical innovation only comes from diverse networks, never from big teams.

Why Your Business Plan Just Killed Innovation

 Unless you are a fortune teller, long term business planning is a fantasy.

Why don’t we call plans what they really are: guesses.

Start referring to your business plans as business guesses , your financial plans as financial guesses and your strategic plans as strategic guesses.

Now you can stop worrying about them so much.

Jason Fried and David Heinemeier Hansson – “Rework”

Turtles

One of the reasons that your organisation or sector has largely stuck to “business as usual” is the great little idea that you , your customers or colleagues have in your heads has stayed there.

You might be worried that your suggestion of a different way of doing things may be dismissed as fanciful , naive or even WTTOIDW (“We Tried That Once It Didn’t Work”).

But supposing you take the plunge and your idea lives beyond its first breath: You now have something far worse to contend with.

The business plan.

One of the reasons why innovation fails to take hold in many organisations is our relentless focus on long term business planning.

Your great idea is going to get mortally wounded the moment it hits a 20 page project initiation document. And if it does survive that it has to go through a series of internal approvals culminating in the trial by fire that is the 30 page Board Report.

The odds of a turtle hatchling reaching adulthood are said to be 1 in 1,000. But in most organisations the chance of an idea reaching maturity has significantly worse odds.

But why is this?

Most businesses would agree that innovation is vital for future success –  but very few can articulate how they protect new ideas from becoming an endangered species.

And this is one of the problems we have: Innovation is treated the same way as everything else – whether it’s forecasting how much coffee people drink or estimating annual sick days.

We seek certainty where this is none and assurances of success where it can never be assured. We have grown afraid of failure.  And if there’s one thing we all know it’s – if you fear failure you cannot innovate.

There are very simple and easy ways to reintroduce the creative capacity in our organisations.  One is to skip the business plan altogether and start backwards. Literally. 

A company who do it well are Amazon.

After an idea is generated they start by writing a press release as if the product or service is ready for launch. They bring it to life.

It’s mocked up with pictures of the product and quotes from (imaginary) customers about how life changing it has been.  It’s passed around internally at the company, so that they can get feedback on the product, and to solicit any questions.

After getting an initial response (did it create a buzz?) and people adding their own ideas (building ideas – never destroying) it’s passed to a product development team to work it up.

But the team are fairly small – in fact they have to conform to the Two Pizza Rule. That is , there can’t be more of them than can be fed on two pizzas.  If you have to buy more than two large pizzas – the team is either too large … or the team members are. (There’s an important point here – large groups often become an average of themselves – they can kill innovation.)

Only when a shared vision is produced does the actual design stage begin. And guess what?  It happens quickly. As the idea has matured more people have contributed to it , bought into it,  and are dying to see it take its first steps.

It’s no longer an idea. It’s happening.

I’ve used the starting backwards approach on a few occasions and feel its a great way of introducing new concepts. In the past year I can think of at least two projects that have reached Board level – without a paper ever being written. I’ll be sharing how this can work in the context of non-profits over the next few weeks.

But what do you think? Do you agree that business plans and risk assessments can stifle innovation?

(Note: You can read a fascinating insight into the Amazon working backwards approach on the Werner Vogels blog from all the way back in 2006)

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