The traditional composition of work teams is internal, stable groups that stay within their resources, knowledge, and dynamics to address the initiatives of their organization. However, the constantly changing climate of the business world demands an equally dynamic team structure to keep up.
In Deborah Ancona and Henrik Bresman’s recent article for MIT Sloan Management Review, “Turn Your Teams Inside Out,” they discuss the benefits of externally focused teams, or “X-teams,” explaining how this team structure embodies a flexible, dynamic, and diverse agility necessary when facing modern-day challenges. While this team style was first identified over 20 years ago, many companies have stuck to their internal team structure, limiting their ability to maintain their speed of execution during times of instability. X-teams work to combine internal dynamics with external outreach into the communities of their business. The authors and other researchers found that resistance to converting internally focused teams to the X-team model stems from a lack of understanding regarding how these teams function.
Implementing an X-team structure
According to the authors, implementing an X-team structure requires three core external activities: sense-making, ambassadorship, and task coordination.
- Sense-making is the first step and includes reaching out to external stakeholders, researching and learning from outside competitors, and seeking beneficial partnerships internally and externally.
- Ambassadorship is focused on seeking internal strategic alignment between the team and the organization’s goals as well as gaining senior leadership support and acquiring resources.
- Task coordination refers to organizing the internal and external individuals who work for the team and ensuring open lines of communication around responsibilities, timelines, and result goals. This step also includes defining the organization's overarching goals, norms, and processes and how they apply to the specific team. This step is an opportunity to ensure team members feel secure in this structure and to promote the continual pursuit of knowledge.
These three main steps can be broken down further as an organization begins implementing an X-team structure.
The benefit of fuzzy boundaries
Traditional internal group dynamics have a stable team with minor changes, while X-teams require a flexible concept of team membership. A primary differentiator of X-teams is that the boundaries around the team are more permeable. INSEAD professor Mark Mortensen calls these "fuzzy boundaries," because the definition of who is and is not on the team shifts depending on the project's needs. X-teams are oriented outside of the team context and can include stakeholders, outside experts, and network connections.
With a less stable membership style, it can be helpful to provide a structure to demarcate the core members of the team, the operational members, and networked individuals. This structure takes a traditionally stable team organization and makes it dynamic with the team’s most current needs.
Start small
To begin implementing an X-team structure in your organization, the authors suggest starting small by incorporating X-team skills on one subset of the organization: there is no need for an upheaval of all established practices. This can begin with assigning team members one task that requires an external connection. With this input, the team can reconvene and discuss the added information they gathered.
It is important to use an "out before in" method with an X-team model. This method begins with external landscape exploration before coming together as a team to discuss the best approach with their updated understanding. The team can then map the outside competitive landscape to understand what they lack comparatively and locate additional information and resources externally. Now, team members can better communicate what resources they need to aid in internal buy-in and allow their work to align with senior leadership and the organization’s overarching strategies and initiatives.
Structure your process in phases
X-team group dynamics involve many complex moving parts, so using phases to help structure your process can help minimize confusion and signal a change in need.
- The first phase is Exploration, where team members map their external environment, define their goals, diversify their knowledge, and establish inside and outside networks to be brought onto the team.
- Next is Experimentation and Execution, where the team evaluates different solutions to the original problem until the best course of action is agreed upon.
- The last phase is Exportation, when the team brings internal support to further refine, engineer, manufacture, or market the team's work.
Throughout these phases, the team will cycle between externally and internally facing work to ensure there is ample communication between all members. Especially with remote workers, it is crucial to "pulse" team activity and brings all team members together to discuss what was discovered, what was completed, and what remains. After pulse meetings, individuals will separate to complete task fulfillment. In their article, the authors referenced the experience of one executive who implemented an X-team structure and shared that “having explicit milestones, deliverables, and deadlines for each phase—exploration, experimentation and execution, and exportation—meant that the team could both innovate and stick to standards and schedules.”
How Microsoft uses X-Teams
Tima Bansal recently published an article covering Microsoft’s use of X-Teams in Forbes, “How Microsoft’s Approach To Teams Is Helping It Stay Ahead Of The Competition”. Throughout the article, she defines how Microsoft has used the X-Team structure to stay relevant and ahead of the curve, operating for over 48 years. X-Teams have been the driving force behind some of the world’s favorite pieces of technology such as the X-box gaming console, now on its fourth generation, and the surface tablet, which combines the best features of the laptop and the portable tablet. One of their strategies, most pertinent to the X-Team structure, is to stay updated on the outside world’s current trends, opportunities, and risks and evaluate how they may use those to their benefit and weave them into their products.
Microsoft’s most current endeavor is its multimillion investment in OpenAI, which they have been partnered with since 2019. OpenAI is the artificial intelligence firm that is behind the ChatGPT chatbot, which has quickly gained popularity after its release in November 2022. Microsoft’s investment in artificial intelligence is another example of how their established X-Team practice provides them with the insight needed to stay ahead of the competitive environment of the technology industry.
The X-team structure allows organizations to stay ahead of the changing landscape they work in, incorporate the expertise of outside individuals, and tap into under-utilized talent throughout all levels of the organization, further improving the organization as a whole.
To learn more about X-teams, enroll in Deborah Ancona’s short Executive Education course, Transforming Your Leadership Strategy, or her self-paced online course, Leadership in an Exponentially Changing World.