I happened to read this article over at The Daily WTF, and it reminded me of some previous team-building events I've been subjected to over the years. Don't miss the comments, there are some pretty great stories in there, as well.
What I've learned over the last 20 years or so is that your team either gets along on a day to day basis, or they don't. If management keeps the more dysfunctional members of the group in line, and encourages working together, rather than finger pointing, you've probably already got as coherent a team as you're likely to get, and having them all go go-carting together isn't going to matter.
On the other hand, if the management plays favorites, or allows bullying to go unchecked, or actually engages in a bit of anti-social behavior themselves, no amount of pot-luck parties are going to change that.
Having said all that, here are some of my experiences:
Always remember rule #1: If the activity is competitive, do not divide your larger team up according to their everyday organizational structure - e.g. Marketing vs. Engineering, for example. Do it however you have to (alphebetical by last name?) to make sure that the distribution is essentially random. Inter-group rivalry is exactly what you're trying to eliminate, or should be, anyway.
Athletic Competition: One former employer had a yearly multi-event athletic competition (mostly "fun" events, like a sack race, or water-balloon toss). Any group of interested employees could form a team, and t-shirts were printed up for the event, and medals given out. As you might well imagine, given that this is an Engineering-heavy organization, injuries were fairly common. Over the years, they gradually rotated out the most physically-stressful events, but I think at least one person still gets injured every year - I had a nerve in my hand crushed during the Tug-of-War one year, for example.
The hyper-competitive types still worry way too much about doing well, sometimes dragging other folks into their sphere of influence (I mean really, what kind of person organizes drills for a Pictionary competition?). But overall, it works well, because everybody knows it's just for fun. Since teams are formed on an ad-hoc basis, it has very little of the "you are now part of a team, go be excellent together" aspect of other team-building exercises. Generally, managers don't force their "best" employees to form a team with them, for example.
Okay, so we can't all work at a company that's willing to throw huge amounts of money and time at something like that. Here's some other experiences I've had:
Laser Tag: I have done this a few times, with different teams. There is a bit of a tendency for the more blood-thirsty team members to enjoy themselves a little too much, but at least the chances of physical injury are minimal. The poor losers will whine that "my gun didn't work", or "I totally shot you first", but the rest of us are used to that (they do it at work every day), so it won't be a problem.
Most LT arenas can be set up to report only the aggregate team score, which helps the whole team feel like they're working together (which is the whole point, after all), and cuts down on whining. I highly recommend not getting individual stats for each player - those of us who suck at the game, or just aren't as into it, don't need a reminder of how poorly we did.
Movies: This can be fun, and usually goes over pretty well, but there's relatively little interaction between team members at a movie. Also, consider that some folks aren't going to want to go to any particular movie you might choose, so have a plan for them to have some fun at the company's expense, too.
One thing you can do to make this more of an interactive experience is to combine the movie with a pre-or-post get-together (catered lunch, maybe?) where people can get together and mingle casually - maybe even discuss the movie together. Many movie theater chains have an "events person" to help arrange this stuff.
If you really want to get the biggest bang for the buck, talk to your local theater about renting out an entire theater for your team (if you're large enough), and have the employees choose which movie they want to see, by voting. Or surprise everybody by renting out a theater for the big summer blockbuster movie on opening day.
Pot-luck lunches: You'd better combine this with something else, or you're in trouble. Some of us really like cooking for a group, but for a lot of employees, this just seems like the company trying to cheap out. At the very least, combine the pot-luck with a 1/2 day, or do it for Halloween and combine it with a costume contest, or something. See also: Picnic in the Park, below.
Miniature Golf: This was a surprising (to me, anyway) success. I figured that all the little cliques would go off and do their thing, but we actually had a pretty good mixing thing going on. We played for fun, rather than running some kind of a tournament structure, which probably helped. It's low-impact, so people can chat, and in general, few team memebers are invested enough to get over-competitive.
Bowling: You might want to try to figure out ahead of time if any of the team members are "serious" bowlers - they might not enjoy playing with a bunch of losers who bowl in the low '60s. But in general, this can work out great - bowling is a "do stuff, then wait" kind of activity, so there will be socialization between rounds. Beer helps with that aspect as well, of course.
Picnic in the Park / Beach day: You're probably located not very far from a nice park of some sort. Take all the employees out for the day, and feed them barbeque, or (if budgets are tight) have them pot-luck it, making sure that the basics are covered, using a sign-up sheet. Make sure frisbees and other fun toys are available, and make sure you have some shade. For extra points, make it an "employees and their families" event.
Amusement Park: Yeah, everybody will be really excited about this, but you likely won't see anybody after the initial arrival, unless you have a very large group, or a very small park. You can plan to have lunch together at one of the "group areas", and that'll get everyone in the same place for a while, but as a team-building experience, it's low on interaction.
So, that's my experience, what's yours? I'm particularly keen to hear from folks that have done more strenuous team-building activities, like the ropes course, or paintball...