Teamwork and collaboration have become more prevalent in both the business and academic world, and this is changing how people think about their workplace environment. Most people entering the workforce really want to work with a team, often one that is diverse in many ways, to achieve discernible goals. The old approach of having separate functional departments is becoming passé. However, what is cross-functional collaboration? If correctly implemented, it is a boon to business.
Cross-Functional Collaboration: Definition of the Concept
All businesses have some kind of functional organization. Traditionally, this has involved a sort of detached teamwork of such departments as IT, marketing, human resources, accounting, etc. Teamwork generally refers to individual work that contributes to group success, and the traditional model of business has a sort of implied teamwork, but very little collaboration.
Collaboration, in contrast, suggests a sharing of ideas and a direct working together by different individuals or departments. Cross-functional collaboration, as its name suggests, is a direct and ongoing business-related conversation between workers from different functional departments.
Most businesses still have a traditional organizational structure. However, there are various ways that collaboration has crept in. Some companies have strategic business units (SBUs) – which are almost like little businesses within a business. SBUs are a weak example of collaboration, in and of themselves, and, possibly for that reason, they are not used that much anymore.
Some companies use a form of a cross-functional collaboration known as matrix management. This approach involves individual workers reporting to more than one manager so that tasks are influenced by more than one department. In some ways, this is more like cross-functional teamwork than collaboration.
Presently, more and more companies are seriously asking what is cross-functional collaboration and how can they implement it. Companies whose edge depends on creativity are especially interested. Most companies get started with cross-functional collaboration by creating a temporary group which is composed of people from different departments of the company. The group is given a specific goal, and – depending on the nature of the goal – members are picked based on rank, job skill level, possession of special untapped skills, gender, age, and other demographics.
A collaborative group like this might be created to make strategic, tactical, or operational decisions. (Strategic decisions are big-picture policy decisions, while tactical and operational decisions are progressively smaller in scope and more related to specific actions.) Such a group might also be tasked with generating solutions to work culture problems – this is obviously a case where the representation of different demographic groups is crucial.
While a team like this sounds as though it would always be a good thing, there are questions of how best to assemble and utilize such a group. Also, there is always the question of return on investment: is the group actually productive, or is it just taking up workers’ time and energy for nothing?
How Cross-Functional Collaboration Applies to Different Industries
Cross-functional activities are especially valuable in software development. In fact, Agile (a software development approach) depends on cross-functional collaboration. Agile involves flexible, self-created groups that establish and achieve sub-goals, then check in with each other, assess the situation, make changes accordingly, and then finally proceed towards more sub-goals or the larger goal.
In marketing, cross-functional organization involves the coordination of sales, market research, marketing/advertising, operations (design, manufacture, resources, etc.), and finance. This is no easy feat: Each of these areas sees the business from a different angle, and, as a result, has a different measure of success. This is where a business manager who has cross-functional skills is so valuable: If representatives of different departments attend a meeting to bring their results together without guidance, they are likely to wind up confused and disappointed.
The medical field depends more and more on cross-functional work. Initially, medical doctors had all of the power in this field; now, administrators are the more powerful force in big-picture decisions about how medical care is delivered. However, the rise of medical apps, telemedicine, and other medical technology suggests that medicine is morphing into a more complete collaboration of medical expertise, business management, technology, tech development, and scientific research.
Cross-Functional Groups: Pros and Cons
Probably one of the biggest benefits of a cross-functional group is enhanced creativity: this can be creativity in development or innovation, or it can be creativity in changing some aspect of how business is done or how the workplace is managed. If you want to instigate change, then a cross-functional group is a must-have.
Cross-functional groups are required for company wide optimization of process. Individual departments usually have relevant goals and KPIs (key performance indicators) and they keep their minds set on these. However, sometimes, this focus on department-only goals is not ideal for the whole company. Individual workers might even know this, but there usually is no incentive to do otherwise. This incentivized acceptance of less-than-ideal performance is known as sub-optimization. Cross-functional collaboration directly combats this counterproductive lack of goal coordination.
Cross-functional groups are necessary for continuous improvement. Continuous improvement is the driving idea behind some excellent business methods that originated in Japan but are spreading around the world. The quintessential example is Kaizen, but there is also the Toyota Production System (TPS), Lean, Six Sigma, and Kanban, among others.
Kaizen is an entire business philosophy that emphasizes the continuous improvement of business at all levels – individual worker, subsections, and the whole entity. Lean is a manufacturing philosophy with an emphasis on eliminating waste – wasted time, wasted resources, wasted energy, etc. Six Sigma is often combined with Lean, and called Lean Six Sigma; Six Sigma by itself emphasizes the improvement of business processes.
Kanban, an inventory scheduling system, is a part of Lean and is used to promote Just-In-Time (JIT) manufacturing, also known as TPS (Toyota Production System) – these approaches are aimed at reducing wasted time at each stage of production.
This list of business philosophies and approaches is merely a sample of all the possible systems that could utilize cross-functional collaboration. They all involve a cycle of decision-making, execution, and assessment of what worked and what did not. Generally, assessment is where the cross-functional group shines – without a coordinated assessment, individual departments would be left feeling helpless to change conditions within the business that are adverse to their goals, and wasted time and energy would persist.
While cross-functional collaboration can be the best way to create change and promote continuous improvement, it is subject to some problems. Probably the biggest issue is social loafing, the tendency of people to work less when part of a team. Therefore, a cross-functional team might not achieve as much as expected, based on the individual members.
A system of accountability is a way to combat social loafing. Social loafing is not necessarily the same as laziness; some people might just be more passive in group environments – they might need to be invited to give their input, or perhaps their role in the group needs to be more clearly defined.
Also, ironically, cross-functional collaboration could exacerbate something it is intended to combat: groupthink. Groupthink is the tendency of group members to avoid conflict with one another by agreeing even when individuals should be able to think of objections; other instances of groupthink are isolating members who do speak out, and failing to process opposing views or new information from the outside.
While cross-functional teams are meant to avoid insular, department-wide-only thinking, they are still subject to the weaknesses of groups. Clear objectives and diversity of membership help combat these common group pitfalls.
Practices That Make Collaboration Effective
Generally, cross-functional skills are the same as those that make someone a good group member in any context: communication skills, sympathy/empathy, patience, attentiveness, and cooperativeness. However, perhaps assertiveness and capacity for independent thought should be added to this list – to avoid groupthink. The ideal cross-functional collaborator should be someone who knows how to find a balance between cooperation and assertiveness.
Part of striking this balance is being a clear communicator – being able to state specifically what your concerns and desires are, so that fellow collaborators do not have to guess what you mean. Many of the worst conflicts happen because people are not clear about what they truly want. Lack of clarity often leads to mutual frustration and blame.
People who successfully lead cross-functional collaboration projects emphasize the importance of listening and speaking to understand, rather than giving directions and demands. Representatives of different functional departments come with different assumptions and biases, which are based on the goals and performance metrics of their department or role in the department. Leaders and regular group members alike must listen until they basically understand the key performance indicators (KPIs), emphases, biases, and current goals of each department involved in the collaboration.
An understanding of where different group members are coming from is the basis on which a sort of common language can be developed. Speaking “the same language” is the ultimate implicit goal of a cross-functional collaborative group. Ideally, this same language is not forced, but rather, is an organic result of collaborative discussion.
Who should be part of a cross-functional collaborative team? It is tempting to say that the highest ranking worker from each department should be chosen. However, there are complicating factors. Sometimes, a lower-ranking worker has untapped expertise (in social media, for example) that allows them to inject new ideas.
Also, some people are excellent influencers – because of an engaging personality or other exceptional skills – and these people are great at getting other people to get on board with whatever they are thinking; influencers are the perfect members of a collaborative group, because they are sure to make their department listen to new ideas.
Technology is a boon to collaborative projects. The ability to create platforms, apps, and notifications makes collaborative action more feasible than ever. In the past, collaboration inevitably involved group meetings that took time and energy from regular business activities, leaving those involved feeling drained.
Now, it is possible for people to share notifications of spontaneous ideas within seconds. Technology makes collaboration a natural part of life, and so technological adjustments are often necessary when building a cross-functional collaboration program.
Cisco, the company famous for network security, created a cross-functional collaborative team with the goal of improving router security. They involved individuals from departments of marketing, manufacturing, quality assurance, customer service, and software engineering.
The entire collaborative group was large, but Cisco did something that many companies that fail with collaborative groups do not do: they had a leadership structure within the collaborative system. Certain members were accountable to top management and reported the group’s achievements and issues; also, the top collaborative leaders were actually people of executive status.
We can conclude from this that strong leadership and accountability are key to the profitability of collaborative systems. Groups that are just casually formed, with little guidance, are not likely to yield any great progress.
An industrial wholesaler (a company that sells in large quantities to retailers) founded in Kentucky used multiple cross-functional groups to find new sales approaches and opportunities; each group had a very specific goal in general areas such as improving communications or making distribution more efficient. It is probably because of the well-honed goals that these groups had that they ended up meeting their objectives and making the whole company perform better.
What is cross-functional collaboration? It is a great opportunity for company growth and improvement, if done correctly. However, if the inception of a cross-functional program is sloppy, the purpose vague, or leadership lacking – even the most well-intentioned collaborators will end up frustrated and will not create any positive results.
In fact, to make matters worse, failed teams cost money, time, and worker energy; they can be a real drain on the company. Therefore, companies should only engage in cross-functional collaborative projects if they have specific goals in mind and a plan to govern the group’s actions and communications.