Hollywood can help you build above average teams
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Price’s Law predicts that in an average team of 9 people, the top 3 performers will add about half of all the value. But great leaders don’t build average teams.
The pope was once asked how many people work at The Vatican, to which he famously answered “About half of them”.
Maybe you’ve experienced this in your own career? In many sales teams the majority of the revenue is generated by a few top performers. In the IT industry I’ve seen this myself. Some systems or software engineers just add way more value than others.
Price’s Law states that 50% of the output is created by the square root of the number of creators. So half of the sales done by a team of 25 would come from the 5 top performers (5 x 5 = 25).
Obviously this is only a model and the actual numbers won’t always be 50% or the square root. But it’s remarkable how accurately this law applies to everything from authors and book revenue to movies and box office earnings.
I did some back of the napkin math and the top 25 movies from 2019 accounted for about half of the total box office revenue. Depending on exactly how you count there were about 900 releases last year, so Price’s Law would have predicted the top 30 (30 x 30 = 900).
Back in the real world, what should leaders do about this? An average team of 9 will have about 3 top performers. This is normal. Our challenge is to build above average teams by activating the other 6 members!
Maybe you’ve experienced this in your own career? In many sales teams the majority of the revenue is generated by a few top performers. In the IT industry I’ve seen this myself. Some systems or software engineers just add way more value than others.
Price’s Law states that 50% of the output is created by the square root of the number of creators. So half of the sales done by a team of 25 would come from the 5 top performers (5 x 5 = 25).
Obviously this is only a model and the actual numbers won’t always be 50% or the square root. But it’s remarkable how accurately this law applies to everything from authors and book revenue to movies and box office earnings.
I did some back of the napkin math and the top 25 movies from 2019 accounted for about half of the total box office revenue. Depending on exactly how you count there were about 900 releases last year, so Price’s Law would have predicted the top 30 (30 x 30 = 900).
Back in the real world, what should leaders do about this? An average team of 9 will have about 3 top performers. This is normal. Our challenge is to build above average teams by activating the other 6 members!