Amazon CEO Jeff Bezos Amazon CEO Jeff Bezos. REUTERS/Gus Ruelas

Once at an Amazon offsite, managers had the reasonable-sounding suggestion that employees should be increasing communication with each other. To their surprise, founder and CEO Jeff Bezos stood up and announced, "No, communication is terrible!"

This stance explains his famous two-pizza team rule, that teams shouldn't be larger than what two pizzas can feed. More communication isn't necessarily the solution to communication problems — it's how it is carried out.

Compare the interactions at a small dinner — or pizza — party with a larger gathering like a wedding. As group size grows, you simply can't have as meaningful of a conversation with every person, which is why people start clumping off into smaller clusters to chat.

For Bezos, small teams make it easier to communicate more effectively rather than more, to stay decentralized and moving fast, and encourage high autonomy and innovation. Here's the science behind why the two-pizza team rule works.

Communication gets terrible as team size grows

The issue with larger teams isn't quite the team size itself. As organizational psychologist and expert on team dynamics J. Richard Hackman would point out, it's the number of links between people that is the problem. He came up with a formula for determining the number of links between members in a group: n(n-1)/2.

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As group size increases, the links start to get unwieldy.

  • If you take a basic two-pizza team size of, say, 6. That's 15 links between everyone.
  • Double that group for a team of 12. That shoots up to 66 links.
  • A small business of 50 people has an incredible 1225 links to manage.

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The cost of coordinating, communicating, and relating with each other snowballs to such a degree that it lowers individual and team productivity. Hackman explained, "The larger a group, the more process problems members encounter in carrying out their collective work …. Worse, the vulnerability of a group to such difficulties increases sharply as size increases."

Two-pizza teams protect against the team scaling fallacy

Many managers and leaders fall into the mental trap that adding more people to a team is always good. People are your best assets, so adding more assets to a project should power up progress right?

The fact is, larger team size makes people overconfident. This is the tendency for people "to increasingly underestimate task completion time as team size grows," as researchers Bradley Staats, Katherine Milkman, and Craig Fox explain. In one of their experiments, they discovered that when tasked to build the same Lego figure, two-person teams took 36 minutes while four-person teams took 52 minutes to finish — over 44% longer.

Yet the larger teams were almost twice as overoptimistic about how long they'd take.

When a project is running behind, you want to get something done faster, or there's an ambitious milestone at stake, it seems reasonable to add on more people power. Sticking to a max number of a two-pizza team will balance a natural tendency to underestimate the costs and friction of dealing with those extra links.

A defense against stress and frustration

When psychologist Jennifer Mueller was going through a collection of work journals for a research project, she noticed that people in larger teams seemed to be more stressed. When she studied over 200 knowledge workers, in team sizes ranging from three to 19, she found that something called "relational loss" plays a powerful role in why individuals feel and perform worse on larger teams.

Relational loss is the perception that you're unable to get as much support — whether it's someone lending a hand when you're in the weeds, helping you solve problems, providing important information and appreciation, or lending an attentive ear when you're having a rough day. Mueller explains:

"[I]n these larger teams, people were lost. They didn't know who to call for help because they didn't know the other members well enough. Even if they did reach out, they didn't feel the other members were as committed to helping or had the time to help. And they couldn't tell their team leader because [it would look like] they had failed."

As links accumulate in a growing team, you start losing that close-knit feeling of support — and it's harder to know where to turn. Adding more and more people, when you're not careful, erodes the protective buffer of work relationships against stress and frustration.

Put another way, larger teams run the risk of violating what I like to call the Cheers rule of effective teams. It's harder to be in an environment where everybody knows your name and understands who you are as a person. That starts to make a difference in your productivity and motivation every day.

cheese pizza Make the 2-pizza rule work for your team. REUTERS/Paulo Whitaker

Trying to find your two-pizza team magic? Here are three tips to get you started:

1. What's the magic number?

Bezos's two-pizza rule works out to at most 6 or 7 non-ravenous people. Teamwork expert Hackman pegs his magic number at 5 and fervently warns against going above 10. Management expert Bob Sutton cites the U.S. Navy Seals as having learned that 4 "is the optimal size for a combat team."

It's safe to say that a small team count sticks to single-digits, so start thinking of splitting into subgroups when you get beyond 10 people.

2. Follow the "Cheers" rule of effective teams.

Relational loss is a perception — so the more you can do to bring your teammates together, the better your team will be.

With thousands of employees, Zappos puts a lot of thought into scaling the same strong culture, familial atmosphere, and tight-knit feeling that it had when it was much smaller. They even hacked together a "face game" — when you log into the computer system, an employee's face and bio pop up and you guess the person's name. The smaller startup, Karma, follows the Cheers rule by eating family-style lunches together every day.

3. Make teamwork easier through transparency.

According to Hackman, one crucial support structure found with effective teams is "an information system that provides teams the data and forecasts members' need to proactively manager their work." Every jump in relational links as groups get larger opens the door to more miscommunication and misinformation.

Providing self-service transparency through systems, processes, and tools help distribute information and power so individuals can get aligned and move forward together as a team.

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