Chartering the Course in Team-Based Projects: Do Team Charters Affect Performance in GVTs?

Abstract

We conducted an experiment using 1,891 student teams that completed an eight-week international business consulting project. Half of the teams were instructed to develop a team charter, while the other half were not. Teams with charters saw improved process performance metrics, but only at the forming stage of team development, and reported higher conflict levels. However, more conflict did not negatively affect peer evaluations or team output quality, suggesting that such conflict was not entirely negative. Team charter was not directly associated with output quality. However, team national diversity moderated the creativity of the project output such that high-diversity teams benefited from charter use in producing a more creative team output. These findings suggest team charters may initially aid process improvement but not necessarily the quality of the output. We hypothesize that the difference between the two groups studied is essentially one of formal written versus informal psychological contracting, which provides for equifinality in performance over the lifecycle of a project. The study contributes to the theory on team charters, particularly with respect to formal versus informal psychological contracting within the context of global virtual teams. The implications for the use of charters in team-based projects are discussed.