According to a new study, gradually increasing the stakes of a fixed group coordination project step-by-step helps boost overall team performance.

"What drives successful group coordination is important because team coordination is ubiquitous in many work settings, such as in medical professions, in law enforcement, or in finance," said Plamen Nikolov, assistant professor of economics at Binghamton University. "Therefore, uncovering the key determinants of successful group coordination is paramount."

The study, published in Management Science, investigated the potential a gradualism approach has in promoting team coordination.

Gradualism is often used within organizations for team building and training efforts.

The technique is particularly popular in the microfinance sector. "Group lending can result in better loan repayment rates when lenders first approve small loan sizes and then progressively approve a higher loan amount once a group proves to be a reliable borrower with smaller loan amounts," said Nikolov.

The researchers randomly assigned participants to groups with different levels of stakes for hypothetical projects.

One group had a gradual increase in stakes over time, the second had consistently high stakes, while the third had a low stake for half the experiment and then a high stake in the second half.

The team found that the gradualism treatment group significantly outperformed the other two groups.

"Our findings have broad lessons and implications for how managers can structure team practices where the decision regarding the order of tasks a team tackles is a variable that they have control over," said Nikolov. "If successful group coordination is a manager's objective, our central finding points to a stylized feature of how managers can structure group assignments optimally: teams need to start small and then progressively and slowly move to high-stake tasks."