test 33 
Paycor Finds One-Third of SMBs Describe Their Teams as “Effective”
Skip to content

New Research from Paycor Finds Only One-Third of Small- to Medium-Sized Businesses Describe Their Teams as “Effective”

Report Identifies Team Composition, Conflict and Communication as Contributing Factors, Provides Tips and Tools to Help Create More Effective Teams

CINCINNATI – Jan. 14, 2020 – Human Capital Management (HCM) company Paycor today released “The HR Benchmark Report: How to Recruit, Coach and Develop Teams.” Conducted by The Starr Conspiracy and commissioned by Paycor, this new research provides data-driven insights from more than 1,000 human resources (HR) and finance leaders of SMBs across the U.S. on how they currently create and manage their teams, the issues they face, and best practices in recruiting, coaching and developing processes to build effective, high-functioning teams.

According to a study titled, “Impact of Team Work on Employee Satisfaction,” employees who are part of effective teams are more likely to describe themselves as “fully engaged,” more satisfied with their careers and their company, and even more optimistic about their lives outside of work. In a high-pressure, competitive work environment, individuals who become valued team members are more likely to feel more effective, more capable and, therefore, more engaged.

Paycor’s research found that while 67% of small- to medium-sized business (SMB) leaders agree that building teams is important, only 31% describe their teams as “effective.” As such, it appears businesses today are struggling to build successful, high-performance teams.

Paycor’s “HR Benchmark Report: How to Recruit, Coach and Develop Teams” reveals core strategies for how SMBs can build “effective” teams. Key findings include:

Include a Mix of Personalities

Eighty percent of SMBs say they try to create teams of high performers. Paycor found a widespread bias toward creating the proverbial “all-star team,” where individual high performance is based on past measures of success. However, Type-A high performers can bring a degree of competitiveness to their work that can be counterproductive in a team setting, as the idea of a “superstar” presumes that the person defines themselves by standing out from the crowd. As such, teams, especially in SMBs, need a mix of personalities, which requires a fine tuning of the recruiting process.

SMBs can implement various tips and tools to ensure recruiting for the open position ends in success for the team. Building a hiring profile document describes the ideal candidate, their role and value they would add to the team, as well as ensure stakeholders to align on exactly who the team is looking to hire. Additionally, interview scorecards help define and objectively standardize the most important criteria for candidate evaluation, operationalizing the work done in the hiring profile. And investing in an employee referral program empowers employees to identify and recruit the people with which they most want to share their work lives.

Establish a Coaching Culture of Feedback

Paycor found less than a third of SMB leaders say they manage team conflict well. Conflict is inevitable, but can be used to a team’s advantage; an article in Harvard Business Review encourages teams to “disagree more at work” because healthy conflict tends to lead to better business outcomes. To realize the positive benefits of conflict, SMB leaders need to establish a coaching culture of feedback.

A culture of feedback helps take the sting out of conflict. Normalizing feedback tends to have less conflict because negative emotions don’t have a chance to take root. Offering employees actionable and potentially life-changing insights on how they can achieve their potential up front and without charge, implementing 360-degree feedback into the performance review process for a holistic view of a team member’s performance and training managers to decipher feedback and convey it in a positive, actionable way prove beneficial for individual employees, healthy for teams and better for the overall business.

Teach Collaboration and Interpersonal Skills

Seventy-six percent of SMB leaders say teams are the best way to get top performance from individuals. But nearly half of SMBs report communication between team members is a common obstacle to peak team performance. Furthermore, a Salesforce survey of larger, enterprise organizations mirrored Paycor’s findings in the small business world: 86% of employees cite lack of communication and collaboration as a top driver of team failure. As such, SMBs should work to shift the focus of teams from individual performance to teaching collaboration and interpersonal skills.

Collaboration is a skill that can be learned; it is not a personality trait. Investing in a learning management system (LMS) that enables a wide range of courses, including soft skills like interpersonal communication and collaboration, that offers a variety of formats (online, interactive, self-paced) to accommodate diverse learning styles, and promoting peer-to-peer learning, which enables team members to learn from each other, are just a few ways that collaboration can be a competitive advantage in an increasingly knowledge-based economy.

To access the full report and learn more about how to recruit, coach and develop teams for better business outcomes, please click here.

Survey Methodology

Paycor and The Starr Conspiracy partnered to produce this report based on an analysis of an online survey. The survey was conducted within the United States by The Starr Conspiracy on behalf of Paycor in October 2019 among 1,100 adults ages 18 and older who are employed full-time as a finance manager, director or executive or HR manager, director or executive at a company with 50-750 employees. Data were not weighted and are only representative of those who completed the survey.

Supporting Quotes

“The way organizations of all sizes conduct business today is very different than it was even a year ago,” said Karen Crone, CHRO at Paycor. “As such, business endeavors no longer revolve around the individual, but entire teams that are composed of diverse personalities that play to different strengths and offer divergent perspectives. Building an effective, high-performance team doesn’t stop at just hiring the right people, but carries on with coaching and development that helps the team continue to learn and grow together, while solving today’s complex business challenges.”

Supporting Resources

The HR Benchmark Report: How to Recruit, Coach and Develop Teams

Paycor Website

Paycor Products

Paycor HR Center of Excellence

Paycor Latest News

Join the Conversation

Join us on LinkedIn

About Paycor

Paycor creates HR software for leaders who want to make a difference. Our Human Capital Management (HCM) platform modernizes every aspect of people management, from the way you recruit, onboard and develop people, to the way you pay and retain them. But what really sets us apart is our focus on business leaders. For 30 years, we’ve been listening to and partnering with leaders, so we know what they need: HR technology that saves time, powerful analytics that provide actionable insights and dedicated support from HR experts. That’s why more than 30,000 medium & small businesses trust Paycor to help them solve problems and achieve their goals.


Katy Bunn

[email protected]

(513) 307-6392


Marta Debski

Offleash for Paycor

(810) 956-4501

[email protected]