direct reports, each of whom leads a team effort within a particular functional group. Although each direct report/group is measured independently, the groups must realize that they form a team and that the results of the total team are what count. There can be no such thing as saying "Your end of the boat is sinking.

Without integrated team effort, the company will be unable to understand and resolve all the critical issues that cross organizational boundaries. Some of the issues (financial compensation, working environment, product quality) require the mutual efforts of several groups, whereas others (product pricing, materials sourcing) can be resolved by special pairwise relationships between groups.

Table 2-1 lists some crucial tasks that call for high levels of formal cooperation and coordination.

To achieve the level of teamwork required to form and grow a successful company, it is important that the top-level team (direct reports to the CEO) consist of high-quality individuals with measurable experience and expertise. The head of the start-up's engineering department must have proven expertise in the company's technology/product domain; in addition, he or she must be able to perform a function, such as design or analysis of some portion of the design. The top-level team must also be "do"-oriented rather than "management"-oriented. Each member must be able to "play" several positions on the team that reports to him or her rather than just managing the team. This requirement implies specific kinds of competence and serves to ensure that:

• Members of the top-level team have an appropriate level of competence, ruling out bureaucrats who come from large companies and possess the necessary credentials on paper but often lack actual competence

• The department head really knows what's going on in the department, since he or she functions as an active participant instead of just serving as the "boss"

• The organization is lean right from the start, since it does not have the separate line (brawn) and staff (brain) components characteristic of many large, "fat" companies

A top-level team that passes these tests demonstrates competence, and competence is the basis for respect. Respect among the collected heads of the various groups will ensure that they function as an integrated team rather than as a collection of egocentric or warring individuals.

Even though the team operates in an integrated manner, each of its members still has his or her own contributions to make. The measure of a team's success is how the contributions that its members make through their individual roles combine to produce an overall result that is greater than the sum of the separate contributions,