Let’s begin this with a question, Imagine you are running a multi-functional organization and your firm has bagged a software development project. To accomplish this, you also require some graphic designers. Now, would you rather hire an external resource or use the graphic designer of your own marketing department? If you are keen on saving the resourcing costs and utilizing resources efficiently, certainly, you will choose the latter. This is exactly what a cross-functional team means. Employees from different functional teams work together towards a common goal. Forming these teams offers myriad benefits. One of the major benefits businesses can avail of forming a cross-functional team is the access to a diverse range of knowledge and skills within the organization. Moreover, it also allows them to save costs by minimizing external hiring and leveraging the cost-effective global resources of the firm. Gartner’s research reveals that: 90% of boards of directors believe that the recent COVID-19 crisis increased the need for cross-functional collaboration. Along with the above-mentioned benefits, cross-functional teams entail multiple other advantages. Thus, managers must implement the right measures to empower them at their respective organizations. This blog takes a deep dive into these advantages and best practices to empower cross-functional teams. However, before going further, let’s first understand the formal definition:
1. What are cross-functional teams?
Cross-functional teams comprise human resources belonging to a company’s different functional areas or departments who come together and work collectively to achieve a common goal or accomplish a project. Let’s take another related example. The software development team of a product firm can work cohesively with the sales team to understand the current industry demands and incorporate the requisite features in a new product. This practice is beneficial in two ways. For one, there is extensive knowledge sharing between different departments which will improve the information base of your firm. For two, cross-functional collaboration is enhancing client satisfaction. Let’s delve into the benefits,
2. Advantages of cross-functional teams
Global business leaders are considering cross-functional teams the future of the work structure. The reason is the plethora of benefits they provide for enterprises. Here’s a rundown on those benefits that explain why forming these teams is the need of the hour.
I. Increased innovation
Every employee differs in viewpoints, approaches, and personality. So, when members from different functional groups work as a team, they bring their own perspectives to the table. In addition, their acquired industry experience, unique skills, and creativity combine to pave the way for “out-of-the-box” ideas that boost innovation. For example, Apple uses cross-functional collaboration to enhance customer experience. The business process management team, for example, works cross-functionally with other Apple teams and brainstorms ways to improve the process and achieve desired results.
II. Better knowledge sharing
Forming cross-functional teams facilitates an easy flow of knowledge between different departments. For instance, if a sales executive notices a trend in clients’ expectations, they can share it with the marketing team. It helps the marketing team revamp their strategies using these valuable insights and maintain their competitive edge. Moreover, cross-functional collaboration enables the team to work in tandem and identify and overcome project-related challenges from a broader perspective without limiting themselves to a niche. For instance, CISCO created the “Architecture Centre of Excellence” (ACoE), a cross-functional geography community. Its members are architect experts who can learn, collaborate, and share knowledge about architecture topics. ACoE has helped CISCO achieve some of its business goals, including an increase in site traffic and better clients’ experience.
III. High-performance work culture
Companies strive to maintain and sustain a high-performance culture to deliver exceptional results. As discussed earlier, resources get an all-inclusive perspective to look at a project when they work in cross-functional teams. They can leverage diverse skills and ideas to deduce the best possible solution for a project bottleneck. Moreover, when different departments work in cohesion, it helps the members understand the interdependencies better. They get a clear picture of how the project is the result of the success of each of these interdependent tasks. It also increases individual accountability as every resource knows how their role will affect the progress of a consecutive task. It eventually enhances individual performances and the quality of the deliverable, thereby garnering a high-performance culture.
IV. Enhances efficiency and profitability
Forming a cross-functional team empowers you to go beyond matrix boundaries and leverage diverse projects’ internal resources. This way, it reduces dependence on external channels to hire resources, thereby controlling resource costs and increasing profitability. At the same time, managers can tap into the maximum potential of each resource and leverage their talent, leading to efficient and intelligent utilization of the workforce. Furthermore, working towards a common goal enables the team to synchronize their efforts better. These individual efforts reflect in their work which escalates the overall team’s and organizational efficiency. These benefits are a clear indication of the necessity to empower cross-functional teams. So, let’s understand the ways to bolster them.
3. How to empower cross-functional teams?
Forming a cross-functional team is just half the battle won. Empowering them to ensure their consistent performance and productivity is the real task. Managers can implement multiple strategies to achieve the same. Here’s a rundown on some of the most prominent ones.
I. Standardize communication policies
Seamless communication is important for a business, especially when team members are dispersed across geographical and matrix boundaries. First, you need to establish clear rules and guidelines to streamline cross-functional communication. Deciding on the channels to use across your teams based on the purpose follows next. Managers can implement a common platform, a code of conduct to maintain decorum, and establish the rules for using synchronous and asynchronous methods. It helps minimize the chances of discrepancies and internal confusion regarding communication. Besides, you can set protocols for away messages, time-outs, email alerts, or one-on-ones with teammates. For instance, one of the protocols can be setting an agenda before the onset of any meeting. It can potentially reduce the meeting hours as the host will stick to the point, ultimately minimizing zoom fatigue and enhancing productivity.
II. Assemble the right team with the right skills
A crucial step to forming the right cross-functional team is assessing the project’s requirements and identifying the resources from different departments accordingly. Competent allocation of the workforce and assembling the right team ensure project quality and timely delivery. Moreover, managers must also ascertain that the resources possess requisite soft skills like team spirit, emotional intelligence, problem-solving approach, etc., that align with the company’s culture. This will allow the team to work in tandem and minimize discrepancies. Further, managers should form a fair mix of resources from different band levels and competencies. It will provide fair opportunities for less-experienced employees or freshers to learn, grow, and prove their mettle in a collaborative environment.
III. Define individual roles and shared goals clearly
Defining organizational goals is essential to align the members’ efforts with long-term objectives. However, while most team leaders ensure this, they fail to take proper measures to prevent “social loafing”, which is: A natural psychological phenomenon whereby employees generally tend to reduce their effort when working collectively instead of alone. It makes those who work diligently feel exploited while the ones who slack off drift away further from their individual accountability. The result is a rift between them, which hampers team spirit and impacts the overall productivity. Thus, a team leader should also establish key performance indicators and goals for individual team members. It will ensure individual and team accountability and secure the project’s fate.
IV. Celebrate milestones collectively
Rewarding oneself is incumbent to boost morale and positivity. Thus, managers must make it a point to celebrate the accomplishment of milestones and recognize the ones responsible for taking it to the finish line. Expressing gratitude towards the whole team and acknowledging individual efforts makes the workforce feel valued and appreciated. Additionally, appreciating and rewarding the work in front of the team fosters a sense of pride and motivates employees to perform better. There are myriad ways to reward and recognize extraordinary efforts. You can send an appreciation email or use social media shout-outs to high-performers and ultimately inspire them to walk the extra mile.
V. Foster trust and transparency
Working with a non-homogeneous group with different mindsets may sometimes cause trust or credibility to erode and build tension. However, it is essential to iron out these differences between the team members and the leader to upkeep cohesiveness and efficiency. Being transparent about your expectations and their performance is also crucial to retaining the team’s trust and confidence in your leadership. Project managers must also promote autonomy and avoid micromanaging the employees. It gives them a sense of responsibility and makes them feel trusted by their leaders. At the same time, managers should conduct timely reviews and one-on-ones to point out the areas of improvement. Moreover, they should also listen to their concerns and assure them of appropriate remedial measures. It will help prevent the issues from aggravating and ensure the sustenance of employee engagement and productivity.
VI. Promote inclusiveness in decision-making
As a project manager, you should always make sure that you are unbiased and give equal importance to all the members from different departments. For this, it is vital for you to ask for regular suggestions, feedback, and opinions about the project to maintain equity among your team members. You can involve them further via regular stand-ups, brainstorming sessions, meetings, etc. Allowing employees from different backgrounds, age groups, communities, etc., in your team to voice their ideas is also a good practice. It will let everyone feel comfortable, valued and contribute to decision-making in crucial matters. This way, you can ensure that all the critical decisions in the course of a project reflect fair representation from all departments.
VII. Encourage change and innovation
A well-developed change management framework is an integral part of a successful organization. It helps you enhance your cross-functional team’s efficiency, stay relevant, and maintain a competitive edge. That’s because a definite roadmap allows members to adopt new technology and tools, processes, workflow restructuring, etc., at ease. Besides fostering change management, you should also aim for a sustainable innovation management process. It encourages out-of-the-box thinking, collaborative effort and helps increase ROI. Innovative and pathbreaking ideas help transform the processes and make them more efficient and resilient, thereby ensuring business sustenance. Thus, integrating these two vital processes will future-ready your workforce and help them tackle the evolving demands and uncertainties with ease.
VIII. Monitor and improve processes regularly
A cross-functional team leader should make sure to stay on top of tracking the project’s progress on a regular basis. Constantly analyzing and determining if the methodologies and workflows set for the project are effective is also necessary. Regular audits of these processes and operations help identify the ones that did not yield the expected output. If and when these setbacks are identified, managers should critically analyze the reasons like excessive time consumption, negligence, mismanagement behind its inefficiency. Accordingly, they should also take the teammates’ feedback and then devise a more effective and efficient alternative method. It will aid resources to perform better and seamlessly execute project tasks.
IX. Leverage advanced tools and technologies
Equipping your cross-functional teams with the latest tools and technology is imperative to streamline project execution. Advanced technology such as AI, ML, IoT, ANN, among others, elevates the automation of routine admin tasks and makes room for creativity. One thing worth considering here is that a tool inventory is unique to every organization and its needs. So, you should choose the one that aligns with your requirements. However, certain tools are a must-have in this inventory. Project management apps and workflow automation software, for example, help outline to-do tasks, streamline their execution, and reduce redundancy. Furthermore, video conferencing apps help connect with teammates across various geographies in real-time. Finally, one of the most important tools for an enterprise is resource management software. It gives enterprise-wide visibility of resources which makes it possible to manage the workforce efficiently. You can add more to this list based on your domain and industry needs.
The following section explains in detail how resource management software helps empower cross-functional teams and utilize them efficiently.
4. How resource management software boosts the productivity of cross-functional teams?
A resource management tool can be a potential enabler in empowering cross-functional teams by providing myriad functionalities and forming a strong team. We have discussed some of them here.
The 360-degree visibility gives an overview of all the resources’ profiles, including competency and skills. Using the advanced filter of the resource management tool, you can pick the best-fit resources and create your cross-functional team for a project. It, thus, helps prevent the allocation of over/under skilled resources to projects. Besides, when the employees work on a project that aligns with their competencies and interest, it enhances their engagement, and eventually, productivity.
At the same time, comprehensive utilization reports can help assess the workload and distribute it uniformly, thus preventing over or under-utilization. Managers can use optimization techniques like resource leveling and resource smoothing to maintain this uniformity. These techniques help prevent overutilization and burnout and let resources limit their attention span to only critical tasks. It elevates their work rate and also ensures the quality of the deliverable.
With foresight into pipeline project demand, managers can gauge the skills gap and take proactive measures to bridge it. For example, initiating upskilling and training programs will allow resources to acquire new skills and fill these talent gaps. It will help them diversify their existing portfolio and promote them to work on multi-faceted projects. This will, in turn, enhance the sense of belonging in them and empower them to be more productive to attain project and career goals.
Additionally, managers can empower employees by letting them select the tasks of their preferences and interest. They can create a vacancy against a particular project task and allow members to volunteer and opt for it. Based on their profiles, managers can then select the best-fit resource.
All these functionalities will enable businesses to maintain the resource health index and motivate the resources and teams to add more value to projects and perform better.
In today’s fast-paced technology-driven business landscape, organizations are striving hard to sustain the fierce global competition due to ever-evolving skill demands. Therefore, companies have now realized that they can no longer rely on the structure of siloed departments and are embracing a culture of cross-functional teams to gain a competitive edge. Cross-functional teams are a great way to look beyond matrix boundaries and break silos. They help foster and strengthen an open-work culture where employees with diverse skills, expertise, and perspectives converge to achieve a common goal. It also boosts innovation, helps save resource costs, nurtures a high-performing culture, and increases profitability. With the above-discussed practices, you can empower your cross-functional teams, raise their productivity, and achieve your company-wide milestones. So, how do you empower your cross-functional teams?
6. The Glossary
7. The SAVIOM Solution
SAVIOM has over 20 years of experience helping multinational clients manage their resources efficiently and effectively. With over 20 years of experience, this Australian-based MNC has a global presence across 50 countries and has helped 100+ clients meet their specific business goals. Saviom also provides tools for project portfolio management, professional service automation, and workforce planning software. So, SAVIOM can help your business to establish an efficient system geared towards your specific business challenges.