A team is a complex system, a living system. In order for a complex system to evolve it needs 3 things:
Having clear boundaries merely means that members know who is actually on the team. Difficulties are common when a team’s boundaries are so unclear that its membership is uncertain, or when they are so permeable that there is a never-ending flow of people in and out the group.
To work well together, team members need to know who they are. Difficulties are sure to develop if there is so much ambiguity about membership that neither members nor outsiders can distinguish between the people who share responsibility for the team product and others who may help out in various ways but are not on the team.
We can have underbounded teams for which it is virtually impossible to develop and implement a coherent strategy for carrying out a piece of work, and overbounded teams (system) which is something like an island, the team is so closed off to its environment that members risk overlooking significant environmental changes, they have limited capacity to respond appropriately to such changes, and they don’t engage in the kinds of cross-boundary exchanges that can be critical to team performance.
Organizational psychologist Clayton Alderfer uses the term underbounded to characterize social systems whose membership is uncertain or whose boundaries are so permeable that there is a constant flow of people in and out. It is nearly impossible for an underbounded team to develop and implement a coherent performance strategy.
A team with tight, impermeable boundaries is an overbounded system. Members typically have a clear team identity and often develop into highly cohesive unit. This is positive, however there is a downside. Highly cohesive groups can become so inwardly focused that they overlook potentially significant contextual changes, and they tend not to engage in the kinds of cross-boundary exchanges that can be critical in intelligence work. And, sometimes high cohesiveness inhibits team learning and the correction of errors.
If boundaries are too thick team will become to inward focused and it won’t respond to changes and information coming from its environment. Maybe for some time this team will grow quickly and be very productive, but at some point in time it will begin its decline for its inhability to respond to change in the environment and exchange information with other teams and the organization. This same problem is suffered by many organizations around the world which for many years have been too inward focused and forgot the market, the new trends and changes in the world.
If boundaries are too vague or transparent the system will not evolve, the system will not perform.
In summary, underbounded teams have difficulties in evolving because they don’t know who they are and where their limits are. On the other hand, overbounded teams have difficulties in evolving because they don’t relate with their environment and they don’t adapt to changing circumstances.