Theorists in business in the late 20th century popularized the concept of constructing teams. Differing opinions exist on the efficacy of this new management fad. Some see "team" as a four-letter word: overused and under-useful. Others see it as a panacea that finally realizes the human relations movement's desire to integrate what that movement perceives as best for workers and as best for managers. Still others believe in the effectiveness of teams, but also see them as dangerous because of the potential for exploiting workers — in that team effectiveness can rely on peer pressure and peer surveillance.

Compare the more structured/skilled concept of a crew, and the advantages of formal and informal partnerships. Of particular importance is the concept of different types of teams. A bright line is usually drawn between "independent" and "interdependent" teams. To continue the sports team example, a football team is clearly an interdependent team: no significant task can be accomplished without the help of essentially all team members, team members typically specialize in different tasks (carrying the ball, kicking the ball, blocking opposing players), and the success of every individual is inextricably bound to the success of the whole team. No quarterback, no matter how talented, has ever won a season by playing alone.

On the other hand, a tennis team is a classic example of an "independent" team: matches are played and won by individuals or partners, every person performs basically the same actions, and whether one player wins or loses has no direct effect on the performance of the next player. If all team members each perform the same basic tasks, such as students working problems in a math class, or outside sales employees making phone calls, then it is likely an independent team. They may be able to help each other — perhaps by offering advice or practice time, by providing moral support, or by helping in the background during a busy time — but each individual's success is primarily due to each individual's own efforts. Tennis players do not win their own matches merely because the rest of their teammates did, and math students do not pass tests merely because their neighbors know how to solve the equations.

Coaching an 'interdependent" team like a football team necessarily requires a different approach from coaching an "independent" team. An interdependent team benefits from getting to know the other team members socially, from developing trust in each other, and from conquering artificial challenges (such as offered in outdoors ropes courses). Independent teams typically view these activities as unimportant, emotion-driven time wasters. They benefit from more intellectual, job-related training. The best way to start improving the functioning of an independent team is often a single question, "What does everyone need to do a better job?"

Managers use teams for grouping people based on a common function. Members of a team usually belong to different groups, but receive assignment to activities for the same project, thereby allowing outsiders to view them as a single unit. In this way, setting up a team allegedly facilitates the creation, tracking and assignment of a group of people based on the project in hand. The use of the "team" label in this instance often has no relationship to whether the employees are working as a team.

A Virtual team consists of members joined electronically, with nominal in-person contact. Virtual teaming is made possible with technology tools, especially the internet. This allows teams to be formed of players otherwise unavailable. Research can be performed using input from the best minds around the world. Work projects can be completed by spreading the workload among long-distance players. Many businesses build their competitive edge on the capabilities and efficiencies of virtual teams.

Teams can sub-divide into sub-teams according to need. A team used only for a defined period of time often becomes known as a project team. Many teams go through a life-cycle of stages, identified by Bruce Tuckman as: forming, storming, norming, performing and adjourning.