Local and remote team cohesion effect on performance in the software industry

Abstract: Background: The COVID-19 pandemic forced many companies to transition to remote work, which has created a social distance among team members that may affect team performance. Although previous studies have examined the relationship of team cohesion and team performance, few have investigated the question whether remote work affects team performance. Specifically, this study examines the correlation between team cohesion and team performance by comparing the same teams working locally versus remotely. Objectives: The objective is to investigate the correlation between team cohesion and team performance based on whether teams work locally or remotely. Method: The study was quantitative, using regression analysis. Data was gathered at a software company in Sweden. Team cohesion was evaluated based on verbal mimicry via the Language Style Matching (LSM) algorithm, applied on chat messages. Team performance was evaluated based on git contributions and tickets done. Team efficiency was analyzed via Data Envelopment Analysis (DEA). Team efficiencies were analyzed in the context of both time periods, before and during the COVID-19 pandemic, and both work settings. Association between team efficiency and team cohesion was investigated based on the work setting. Tools such as Excel, R, Python, LIWC, and MS Forms were used. Analysis results: When efficiency is correlated with LSM score (cohesion) for teams working remotely, there is a significantly strong positive correlation, suggesting cohesion plays an important role on team efficiency when working remotely. This observation is in line with previous research on cohesion influence on performance of local teams. The change of work setting did not affect the cohesion level of teams. Conclusions: Teams working remotely can be as effective as teams working locally. Teams working remotely can be as cohesive as teams working locally. Cohesion is especially relevant for team performance when teams work remotely. Recommendations for future research: One suggestion is to add Social Network Analysis (SNA) in the study to enhance internal validity of team cohesion measurement. Additional research could be done by conducting a qualitative study to compare against the perceived cohesion and performance.