Here is a brief excerpt from another classic article written by David Kirk for the McKinsey Quarterly, published by McKinsey & Company. To read the complete article, check out other resources, learn more about the firm, obtain subscription information, and register to receive email alerts, please click here.

To learn more about the McKinsey Quarterly, please click here.

* * *

Winning teams are tough to find—and even tougher to build. In this classic McKinsey Quarterly article from 1992, the former captain of New Zealand’s mighty All Blacks rugby team, David Kirk, explains how to develop superlative performers.

There are very few tricks for improving organizational performance left in the management deck of cards. In recent years, many eager corporate hands have played the organization redesign card; others, strategic planning; still others, value-based management. If they played them well, their companies are now fitter, stronger, more flexible, and more focused. But so too are their competitors. Sloppy strategies have been tightened; yawning skill gaps closed; troubled economies made healthy; and bloated organizations made lean. What remains—the trump card—is the effort to coax exceptional levels of performance from all the pieces now in place. And that means learning how to build and lead world-class—or what McKinsey’s Jon Katzenbach and Doug Smith refer to as “high-performing”—teams.

I have had the good fortune to lead two such teams. I played senior club rugby in New Zealand for eight years, provincial rugby for Otago and Auckland for six, and international rugby for New Zealand for five. During that time I played with many different collections of players, about forty-five or fifty of which I would characterize as genuine teams. Of these, two were indisputably world class: the World-Cup winning All Blacks of 1987, and the Auckland team of 1985–87.2 A third, which came very close to being world class even if it was not the best in the world, was the All Black team of 1986, which played one Test match against France and one against Australia.

Teams such as these are extremely rare. They are tough to find and even tougher to build. But they do exist. They can be built. And they can be led. Anyone who has seen one in action or been fortunate enough to participate in or lead one will know it.

Perhaps these teams are most easy to recognize in the world of sports because performance there is so starkly quantified and transparent. I immediately think, for example, of the Liverpool Football Club, the McLaren Formula One racing team, the San Francisco 49ers, the LA Lakers, the Australian rugby league team, and the West Indies cricket team of the 1970s and 1980s. Each of these teams, of course, was immensely successful, but that alone does not make them world class. Many other very successful, even championship, teams do not pass the test. They lack something—some special quality of effortlessness and coherence, a wholeness that other teams, no matter how good, just do not have.

Team members know and feel this difference, the presence or absence of a certain sense of ease and unshakeable confidence. Subjectively, the dividing line is painfully clear. But how can we recognize it objectively, from the outside?

Signs of greatness

There are, I think, three “external” qualities that indelibly mark out genuine world-class teams:

o The first is a lack of mistakes. These teams seem to understand the game so well and to have practiced so much that they have almost eliminated unforced errors. This is partly a result of the “divine discontent” that drives their performance, as we will see later, and partly a result of the relaxation that comes from confidence and an implicit faith in themselves.

o The second is the margin of victory they achieve. World-class teams do not just scrape home; they thrash their opponents. This is hardly surprising. World-class teams are rare, so they seldom get to compete with other world-class teams. Nevertheless the margin of victory they achieve is a measure of just how much potential is waiting to be unlocked in building high-performing teams in sports and business.

o The third is the charge they get from what they do. World-class teams genuinely look like they are having fun. Even in the toughest moments at training or during a match, they maintain perspective and balance. Self-confidence coupled with belief in the other members fires each member of the team not only to perform, but to enjoy.
Qualities of greatness
If world-class teams can be recognized from the outside by a lack of mistakes, an ease of performance that leads to high margins of victory, and a joy in going about their business, what is it about them internally that enables them to perform so well?

[Here’s the first defining characteristic]

Vision

The first characteristic of such teams is vision. Teams must have something to believe in, something to achieve, something to become. Vision does not mean objectives. All teams have objectives, and the best teams are clear about exactly what they are, but few have real vision. Objectives are cold, intellectual, rational, believable. Progress toward them is quantified, defined, measured. Visions must be rational, but they are also emotional. They are often distant. They must excite and engage and frighten. They must be big.

Leaders of potential world-class teams ask for sacrifices—in time, in effort, and, most importantly, in individuality—that are immense. There has to be a reason for asking. Only a vision can unite and involve at the highest level. It must be so big that even the most confident team member cannot feel sure of achieving it; so big that even the most cynical cannot shoot it down.

In its most general sense, the vision of high-performing teams is about quality of performance and ultimately about trying to perfect performance. An important distinction needs to be made between vision and motivation. The two are quite different, and those who set out to build world-class teams need to understand how and why they differ.

Visions provide the opportunity for individuals to grow and achieve on a grand scale. Over time, the struggle to achieve the unachievable becomes a rational goal. However, most of us still need a reason for getting up in the morning. Teams that are consistent world-class performers have a clear vision, but they also have cold, hard incentives for individual and team performance at all times. This boils down to focus and a system of explicit and implicit incentives for performance.

True visions have two important dimensions. They have an external dimension. For the All Blacks, it varied, but in 1987 our vision was the World Cup, and more significantly what it stood for: to be the best in the world.

Not all of the All Black teams I played with had a true positive vision. But all had a type of negative vision, something they did not want to occur—a fear of letting down the past. All Black teams are acutely conscious of their predecessors and the team’s long history of success. Failing that tradition is the negative vision that haunts all New Zealand rugby teams. Negative vision underpins performance and prevents it falling below a level, but it does not act as a spur to world-class achievement. That spur must always be expansive and outward looking, not inward and fearful.

The second dimension all true visions have is an internal dimension. It is a vision of self and what it can achieve through the team. It is a vision of realizing potential, of growing, of taking the chance for the team and the members to become what they are able to be.

The world-class teams I played with had a vision of pushing back the boundaries of the game—of moving the playing of rugby union onto a higher plane. We were simply trying to play the game better than any team had ever played it before. The opposition was no longer the other teams we played against, but ourselves and the game itself. Opponents were the medium through which we attempted to realize our vision.

* * *

“If only I knew then what I know now.” It is, of course, far easier to look back, analyze, and prescribe than it is to do the right thing in the heat of battle. I firmly believe that building world-class teams is not something that can be learned or taught except by example. For that reason I doubt these observations would have been much use to me as I struggled to lead and build a world-class team.

If I had been able to write this at the time, when I was leading rather than thinking about it, I would certainly have done some things differently. I would have tried to be more confident, more prepared, more meticulous. As a result, I would probably have been more distant, less spontaneous, more of a professional, and less of an enthusiastic amateur. Would that have made me more successful? I don’t know. But I do know that leading and building a team is not about acting the role of leader. It is about being a leader. To the extent that analysis and planning interfere with spontaneity, they are a hindrance.

If I had any final insight it would be that there is no substitute for getting people involved and excited. A team that is knee-deep in problems, challenges, fears, and hopes, and that is reveling in them, convinced it will win, and excited about the prospect, is well on the way. The truth is simple. You can’t be world class unless you have world-class problems. The opposition is the opportunity. Take it.

* * *

Here is a direct link to the complete article.

David Kirk is cofounder and managing partner at Bailador Investment Management. Captain of the New Zealand All Black rugby team from 1986 to 1987, he is also a former McKinsey consultant, having worked in McKinsey’s London office from 1990 to 1992. This article is based on a speech given to members of the Sydney office in April 1992.