Five Forces Driving a Decline in Team Effectiveness
Teams are where work gets done. They are the mechanism through which strategies are executed, problems are solved, and value is created. When they function at a high level, research shows that teams make better decisions, take on more complex work, and adapt to changing conditions in ways that individuals simply can’t. Unfortunately, most teams never reach that level. Instead, most teams’ performance consistently falls short of their potential. And, our data shows that gap is widening.
Analysis of 271 Teams Shows that Team Effectiveness is in Decline
We analyzed AIIR® Team Effectiveness Survey data from 271 teams (comprising 2,533 respondents), including thematic analysis of 7,599 open-ended responses in which team members described their culture, productivity, and what they need to reach their full potential as a team, and gathered field observations from our bench of experienced team coaches. Those interested can download the whitepaper to access the full analysis.
Overall team effectiveness across our sample of 271 teams declined 5.9% year over year. While that decline may seem small, in this size of a sample, it is substantial. Team Culture — the interpersonal side of teaming — decreased 5.96%. Team Productivity — the operational side — decreased 4.70%. Both are moving in the wrong direction, but the steeper decline in culture is notable. It suggests that how it feels to be on a team is deteriorating faster than how effectively the team gets work done.
Looking for More Detailed Analysis and Actionable Insights on the State of Teams in 2026?
Gain access to a detailed analysis of assessment data from 271 teams, including actionable insights that will help you understand what is standing between your teams and high-performance.
Five Forces Driving the Decline in Team Effectiveness
Our analysis identified five interconnected challenges driving this decline. They showed up consistently across industries, organizational levels, and all three streams of our research — and each one carries implications for what leaders should be doing right now.
| Force | What It Looks Like |
|---|---|
| 1. The Clarity Crisis | Teams don’t share a clear understanding of vision, priorities, and roles, so effort goes to the wrong things. Click here to jump to The Clarity Crisis. |
| 2. Fraying Bandwidth | Reactive demands consume the capacity teams need for higher-order, long-term work. Click here to jump to Fraying Bandwidth. |
| 3. The Efficiency Paradox | Teams invest tremendous effort, but the return on that effort is increasingly suboptimal and unsustainable. Click here to jump to The Efficiency Paradox. |
| 4. Trust Erosion | Relationships between team members stay cordial, but lack the candor that high-performance depends on. Click here to jump to Trust Erosion. |
| 5. Growing Silos | Teams work well within their own boundaries but fail to connect across the organization. Click here to jump to Growing Silos. |
1. The Clarity Crisis
Alignment, the degree to which team members share a common understanding of purpose, strategy, goals, and roles, declined 4.68% year over year. When asked what their team needs most, the demand for clearer direction was the single strongest signal across all 7,599 open-ended responses. AIIR’s coaches confirmed the pattern, identifying “navigating continuous change” as the most prevalent challenge they observed in the field.
Why Now? This is a byproduct of an environment in which the ground is continually shifting beneath everyone’s feet. The acceleration of AI, ongoing restructuring, competitive disruption, and macroeconomic volatility have compressed strategic planning cycles and made it harder for leaders to offer durable direction. When the strategy itself is in motion, the consequences cascade through every level of the organization: goals become provisional, roles blur, and team members are left to interpret priorities on their own. At the same time, constant shifts in team composition driven by restructuring, mergers and acquisitions, and leadership turnover mean that alignment has to be rebuilt repeatedly, often without dedicated time to do so.
The research is clear on the consequences. Strategic clarity is a critical determinant of worker performance. Role ambiguity is linked to higher burnout and withdrawal; role clarity is linked to higher engagement and stronger initiative.
“Teams are grappling with layers of change in two broad areas — strategy and actual team composition. Strategy is shifting dramatically due to AI innovation and both the immense opportunity and competitive threat it simultaneously brings. At the same time, restructuring and leadership turnover mean teams are constantly reforming, rebuilding trust and shared understanding from scratch.”
AIIR Team Effectiveness Coach
What This Means for Performance. Clarity is the foundation on which Alignment is built. Without it, teams don’t stop working. They work on the wrong things, or they work on the right things in uncoordinated ways. The result is effort without momentum.
2. Fraying Bandwidth
Across thousands of open-ended responses, team members identified bandwidth, more time and energy for strategic work, development, and relationship-building, as one of their most urgent needs. This was not a wish for less work. It was a recognition that reactive demands have consumed the capacity teams need for the higher-order activities that differentiate good teams from high-performing ones.
Why Now? The modern knowledge worker operates in an environment of relentless interruption. Microsoft’s Work Trend Index found that the average employee now spends 57% of their time communicating in meetings, email, and chat and only 43% creating. More recent data shows the problem intensifying: employees are interrupted an average of 275 times per day, and after-hours meetings have risen 16% year over year, contributing to what researchers have called “the infinite workday.” Meanwhile, recent global human capital research found that nearly half of workers report feeling burned out, with constant change and overwork as primary drivers.
What this Means for Performance. When bandwidth runs out, the first activities to be cut are the ones that sustain long-term effectiveness: strategic thinking, development, relationship-building, and reflective practice. In our data, Learning and Adapting, the team’s capacity to continuously improve and adjust as conditions change, declined 4.78%, the steepest drop among the three Team Productivity dimensions. Teams can’t improve if they don’t create space to reflect, making them destined to repeat the same patterns.
3. The Efficiency Paradox
One of the most striking findings was what we call the Efficiency Paradox: teams are investing tremendous effort, but the return on that effort is often suboptimal or unsustainable. Many team leaders will mistake this as a problem with individual performance. But digging further into the data reveals that it is actually a systems problem in disguise — the processes, workflows, and organizational structures teams work within are failing them.
Productivity is high, I think, but I also think the stress level is tremendous and the workplace frequently chaotic. We always seem to get the mission done and mostly timely, but I can’t imagine anyone would disagree there is a price paid.
VP a Professional Services Company
Why Now? Two forces are deepening the paradox. First, the rapid introduction of AI tools and evolving digital workflows has created a transitional period where many teams are caught between legacy systems and new ways of working. The old processes haven’t been retired, and the new ones haven’t been adopted. The result is friction at every handoff. Second, organizations have continued to add complexity — new meetings, new reporting structures, new cross-functional initiatives — without subtracting what is no longer needed. Recent research on global human capital trends identified reclaiming organizational capacity as a central theme, noting that meeting overload, outdated processes, and nonessential work are draining focus across industries.
What This Means for Performance. In the language of our model, the Efficiency Paradox is what creates a Driven Team — high on Team Productivity, low on Team Culture. Results come at the expense of connection, trust, and wellbeing. The highest-scoring item in our entire dataset — “The team leader creates a sense of urgency for producing results” — suggests that the dominant response to declining performance has been to push harder, not to work differently. That approach has a ceiling, and many teams are hitting it.
4. Trust Erosion
Trust and Safety — the degree to which team members feel comfortable raising issues, sharing dissenting views, and taking interpersonal risks — declined 6.30%, the steepest decline of any dimension. Examination of qualitative data confirms the quantitative findings: relationships are professional and respectful on the surface but lack the depth needed for honest feedback, productive conflict, and genuine vulnerability.
Why Now? Trust erodes when the conditions that sustain it — time, proximity, shared experience, and psychological safety — are degraded. The shift to hybrid and remote work has reduced the informal interactions that naturally build relational capital. Constant organizational restructuring means trust has to be rebuilt over and over. And the broader environment has raised the perceived cost of candor.
Trust and psychological safety are fragile in a politically charged environment. Many leaders are hesitant to speak candidly — not because they lack courage, but because the cost of being wrong feels higher than ever.
AIIR Team Effectiveness Coach
Amy Edmondson’s foundational research on psychological safety showed it is the single most critical factor in team learning and performance. Google’s Project Aristotle, which examined over 250 team-level variables, found the same: psychological safety was the most important predictor of team success. When trust erodes, so does the willingness to raise risks, share dissenting views, and hold each other accountable — the behaviors that separate a high-performing team from a merely functional one.
What This Means for Performance. Trust is the operating system on which everything else runs. When it weakens, the other culture dimensions weaken with it. Our data confirms this: Cohesion — the strength of shared commitment, pride, and belonging among team members — declined 5.81%. Dialogue — the team’s ability to engage in productive debate and collaborative problem-solving — declined 5.80%. These are not independent trends. They are symptoms of a trust deficit that is making teams less connected, less candid, and less equipped to navigate the challenges described in this paper.
5. Growing Silos
Interestingly, our data shows a paradox of connection: within teams, members generally report positive professional relationships. Across team boundaries, however, there is significant disconnection. This pattern appeared consistently in the culture data and was reinforced by coaches, one of whom observed that most teams he has worked with “work in silos” and “struggle to be more effective cross-functionally.”
Why Now? Hybrid work has reduced the informal interactions that once connected people across teams. Constant restructuring has disrupted cross-functional relationships. And the increasing pace of work has created a natural pull inward — when time is scarce, teams protect their own resources. Research from Gartner found that organizations with high levels of “collaboration drag” are 37% less likely to achieve revenue goals, and employees experiencing it are 15 times more likely to feel burned out. Silos can emerge as a self-protective response to collaboration overload.
What This Means for Performance. In a world where 84% of U.S. employees now work on multiple teams simultaneously, effectiveness can’t be measured within a single team boundary. When silos deepen, organizations don’t experience the failure of any single team — they experience the failure of teams to connect. And that failure is invisible to any metric that only looks within team boundaries.
How are the Five Forces Driving Declining Team Effectiveness Showing Up in Your Organization?
Download the full report to access a detailed diagnostic that yields actionable insights to help you uncover how these trends are showing up on your teams, before it’s too late.
Reclaiming Team Effectiveness at the Organizational Level
The challenges in this paper are formidable. They are also addressable. Each recommendation below targets one or more of the five forces directly, and because the forces are interconnected, progress on one creates momentum across the others.
Some of these challenges — particularly the clarity crisis and growing silos — are fundamentally system-level problems. They require intervention from senior leaders who have the authority to shape strategy, structure, and organizational norms. Three priorities stand out.
1. Communicate Clarity as a Discipline, Not an Event
The clarity crisis is a system-level problem. Team members at every level are asking for direction about strategy, priorities, goals, and roles — and it was the strongest signal in our qualitative data. The instinct to wait until the picture is fully formed before communicating is understandable. In the current environment, it is counterproductive.
Leaders do not need to have all the answers to provide direction. What they need to do is communicate what is known, name what is uncertain, and create a cadence of communication that keeps pace with the speed of change. A clear vision stated once is a speech. It must be repeated, translated, and cascaded through every level of the organization so that teams can anchor their priorities to something durable.
2. Break Down Silos with Structure
No one decides to build silos. They emerge naturally when teams are heads down, time is scarce, and cross-boundary work feels like an additional burden. However, our data is clear: teams feel connected within their own boundaries and disconnected across them, and the result is fragmentation, duplication, and organizational drag.
Addressing this requires structural intervention: cross-functional forums, shared objectives, and integration mechanisms that make collaboration the path of least resistance. It also requires modeling inter-team trust at the senior level, since leadership team dynamics tend to cascade through the organization.
3. Drive AI Adoption with Intention
The AI imperative is real, but the way it is being communicated is contributing to the very challenges this paper describes. When the message from the top is urgency without direction, it amplifies the clarity crisis, consumes bandwidth, and adds to operational friction. Leaders can counter this by coupling AI urgency with strategic clarity: AI for what purpose, in service of what outcomes, and with what expectations for how teams integrate it into their work. The goal is not to slow adoption, but to ensure it is guided rather than chaotic.
Increasing Performance at the Team Level
Team leaders may not control the strategic direction of the organization, but they have enormous influence over the day-to-day experience of their team — and that experience is where the five forces identified in this paper are felt most acutely. Organizations should be equipping team leaders with the mandate, the tools, and the support to take three actions.
1. Provide the Clarity You Can
Team leaders can’t solve the macro clarity crisis alone. But even when the broader strategy is in flux, team leaders can create clarity at their level. This means taking the time to articulate what the team is working toward, what matters most right now, and what success looks like.
2. Protect Team Time and Subtract What Doesn’t Add Value
The bandwidth challenge will not be solved by asking people to work harder. It will be solved by removing the things that are consuming time without creating value. Team leaders should be empowered to audit workloads, eliminate unnecessary meetings, and challenge processes that have outlived their usefulness. This is subtractive innovation — not asking what to add, but what to take away so the team can focus on the work that matters.
3. Create Psychological Safety Through Daily Behaviors
Trust and Safety declined more steeply than any other dimension. Creating psychological safety does not require a transformation program. It requires consistent behaviors: asking for input and responding with curiosity rather than judgment, normalizing the admission of mistakes, inviting dissent before decisions are finalized, and making space for team members to connect as people, not just role-holders.
Teams don’t tend to take the time to focus on how they are working together. They are moving so fast and tend to focus on ‘what’ they need to accomplish. The data is clear that this approach has a ceiling.
AIIR Team Effectiveness Coach
This is also a moment where external support — a team effectiveness coach, a skilled facilitator, or a trained internal practitioner — can make a meaningful difference. The challenges teams are facing are structural, not motivational. They benefit from the objectivity, structure, and expertise that a professional can provide.
The Path Toward Team Performance
The decline in team effectiveness is real, it is measurable, and it is accelerating. But it is not inevitable. The five forces identified in this paper are the product of specific conditions that leaders at every level have the power to influence.
Leaders, teams, and organizations who take these findings seriously — that invest in clarity, protect bandwidth, confront the efficiency paradox, rebuild trust, and break down silos — will not simply arrest the decline. They will create the conditions for teams to do what they have always been capable of at their best: produce extraordinary results that no individual could achieve alone.
Access More Analysis and Actionable Insights When You Download the Full Report Today!
AIIR’s State of Teams 2026 report gives you more detailed data analysis, powerful diagnostic frameworks, and even more actionable insights. Fill out the form to download the full report.
About The Authors