An overview of cross-functional collaboration with examples

In contemporary organisations, cross-functional cooperation is the key to innovation and efficiency. It’s not simply a catchphrase; success depends on it strategically.

Picture it: Sales, marketing, finance, operations, and IT all sitting at the same table, working in harmony rather than isolation.

However cross-functional teams may face difficulties in the absence of appropriate organisational and technology resources. The primary obstacle, according to the Deloitte study, is a culture that doesn’t completely support this kind of cooperation and team alignment.

This post will explore the fundamentals of cross-functional cooperation, as well as its observable advantages, typical difficulties, and useful advice to assist you in successfully establishing cross-functional teams inside your company. Throughout the process, we’ll present actual case studies of businesses that have successfully used this strategy and will divulge their tactics.

What is Cross-Functional Collaboration?

Cross-functional cooperation is a strategic strategy inside organisations in which people from several departments or functional areas work together on projects or initiatives. This cooperation entails breaking down traditional organisational barriers and encouraging people with varied knowledge and skill sets to work together towards a similar objective.

In essence, cross-functional cooperation encourages teamwork and communication among team members who contribute unique perspectives, experiences, and information to the table. This collaborative endeavour combines the skills of each department to achieve common goals. It is not limited to cross-functional initiatives but may be a constant endeavour to promote creativity, efficiency, and agility throughout the organisation.

3 Reasons You Need Cross-Functional Collaboration

Why do companies need cross-functional collaboration today more than ever before?

Here are a few possible reasons:

1. Need for organisational alignment.

Achieving alignment throughout an organisation may be difficult, especially when separate departments or functions operate independently—and it is even more difficult for remote teams operating in different time zones around the globe.

Cross-team collaboration ensures that all teams are working towards the same goals and are in sync with the overall picture. When teams work together, they develop a shared knowledge of the organization’s goals, values, and strategic direction.

2. Enhancing the value of the client experience

In today’s customer-centric corporate climate, delivering an amazing experience is critical. Cross-functional cooperation is key to attaining this aim by bringing together teams from marketing, customer service, product development, and other areas to promote a common knowledge of consumer demands.

Breaking down departmental barriers enables organisations to synchronise messaging across all consumer touchpoints, delivering a consistent and personalised message at each engagement.

3. Gaining a competitive advantage through faster innovation.

When people from other departments collaborate, they bring new perspectives, talents, and experiences to the table. This diversity encourages innovation and inventive thinking. Cross-functional teams are more likely to generate ideas that would not have appeared in departmental silos.

These new ideas may lead to the creation of game-changing goods, services, and solutions, providing businesses with a competitive advantage in the market.

Benefits of Cross-functional Collaboration

Putting together a team of professionals from different disciplines might take time and effort. But the result is well worth it.

So, what benefits do cross-functional teams provide to the company?

1. Increased business agility

Cross-functional teams are known for their agility and adaptability. With a varied skill set, they thrive in changing environments and move quickly, free of the delays caused by inter-departmental relationships. They can quickly address issues, commence problem-solving, and respond to setbacks, typically shortening the cycle time for new product development.

2. Higher employee engagement

According to Gallup data, employee engagement has dropped to its lowest level since 2015, with only 32% of employees claiming to be engaged at work.

Transitioning to team-focused structures can help solve this issue by improving team connections and workplace dynamics. Cross-functional teams break down silos and bridge gaps, increasing engagement by incorporating people from all levels of the organisation and minimising the distance between management and team members.

3. Enhanced insights

According to research, operating in silos and failing to share data with colleagues from different departments may cost a corporation about $8,000 per day in wasted costs. Cross-functional collaboration can promote information exchange and spark new ideas.

For example, in a company creating a new product, a project manager may put together a cross-functional team of engineers, designers, marketers, and customer service representatives. Their participation will provide thorough insights into all areas of the product from the beginning.

4. Excellent communication skills and team growth.

Cross-functional cooperation fosters excellent communication skills and team growth by bringing together a varied collection of people from various backgrounds. Through collaborative feedback and dispute resolution, team members improve their communication skills while learning from others with various skill sets, making them more adaptable in their positions.

The alignment around clear, shared objectives encourages purpose-driven communication and collaborative work, helping the organisation to construct a high-performing team and promote trust among its members.

5. Improved managerial skills.

Managing cross-functional teams tests leadership abilities since the leader may not be an expert in every discipline but must be able to manage people with varying levels of experience.

Leaders must have the capacity to collaborate effectively with team members from all backgrounds and personalities, allowing others to take the lead when specialised expertise is required for successful decision-making.

6. Removing preconceptions and addressing diversity issues

Cross-functional teams bring together people from many departments to better understand each other’s strengths and difficulties. For example, when a tech team meets a non-tech team, they recognise one other’s challenges and use their knowledge.

This common worldview eliminates stereotypes and facilitates conflict resolution. Furthermore, diverse teams of varying ages, experiences, and perspectives bring new ideas to the surface.

Common Challenges of Cross-functional Collaboration

We have witnessed the advantages of cross-functional teams! So what is not to like?

According to a Harvard Business Review research, nearly 75% of cross-functional teams are dysfunctional and fail to meet at least three of the following five criteria:

Budget Adherence: They frequently struggle to fulfil strategic budget objectives owing to competing departmental agendas and resource allocation disputes.

Maintaining a timetable can be difficult since coordinating activities and timeframes among multiple teams can cause delays.

Specification compliance: It can be challenging to ensure that projects adhere to specifications when different departments have different interpretations and goals.

Consumer expectations: Achieving customer satisfaction can be challenging when various teams have varied ideas about what makes a satisfying output.

Alignment with business objectives: Keeping alignment with overall company objectives can be difficult since various departments may have competing priorities or differing interpretations of the organization’s aims.

But before you give up on the idea of cross-functional collaboration, let’s dig into why these challenges arise.

Cross-functional teams often struggle because the organization lacks a systemic approach.

Teams face confusing governance, accountability weaknesses, hazy goals, and an inability to prioritise cross-functional initiatives’ success. This might lead to a loss of faith in the team and the project, resulting in lower team morale, higher project risks, missed deadlines, budget overruns, and failure to achieve intended results.

Cross-Functional Collaboration: Best Practices and Tips

So, how can you avoid these challenges? Here are some concrete strategies to help you achieve success:

Establish clear governance: Clearly define decision-making processes, workflows, roles, and responsibilities. Ensure that cross-functional teams have a designated team leader who is accountable for the project’s success.

Allocate enough resources. Ensure that all essential resources, such as budget, labour, and technology, are available to carry out the project properly.

Set clear KPIs and targets. Set specified, measurable, attainable, relevant, and time-bound (SMART) KPIs for the project. The team’s aims and objectives must be clearly defined to offer a road map and monitor success.

End-to-end ownership: Designate an end-to-end owner to manage the whole project lifetime. This individual is in charge of coordinating activities across departments and ensuring that the project remains on schedule.

Clear communication channels: Set up clear and effective communication routes for cross-functional teams. Use collaboration platforms such as Slack or MS Teams to make it easier to share information daily.

Cross-training and Team Building: Encourage cross-training among team members to develop a common knowledge of each other’s responsibilities and skills. This encourages collaboration and team cohesion.

Regular check-ins: Schedule frequent team meetings and check-ins to track progress, discuss issues, and offer detailed reports. These sessions should be organised and problem-solving-oriented.

Feedback loops: Set up ways for team members to exchange ideas, express problems, and offer changes. A culture of positive feedback promotes teamwork.

Leadership support: Obtain support from organisational leaders to push cross-functional projects. Leaders should promote teamwork and set an example.

Celebrate achievement by recognising and celebrating significant milestones to inspire and reward team members for their contributions. Positive reinforcement promotes a sense of success and future collaboration.

Examples of Cross-functional Collaboration

Successful businesses don’t form cross-functional teams overnight. They include cross-functionality into their culture, creating a truly inclusive workplace.

Let’s look at a few examples.

1. Northwestern Mutual Life.

Northwestern Mutual Life, an American financial services mutual company, is at the forefront of cross-functional team building. Initially, the organisation used a typical strategy, hiring people whose functions were closely related to project requirements.

However, they have developed. Today, Northwestern is setting the standard by designating at least one “non-stakeholder” for each cross-functional team.

According to Colleen Stenholt, Director of HR at Northwestern, “One of our goals is to break out of the box, and the stakeholders are the people who built the box.”

How cross-functional teams support Northwestern Mutual Life

Northwestern Mutual was an early adopter of cross-functional collaboration, with personnel from finance, investment, and actuarial departments pioneering the research of computer impact on business. This endeavour resulted in the creation of one of the earliest information systems departments, giving the corporation a competitive advantage during the computerization period.

Currently, the corporation has cross-functional teams in practically every area of its operations.

Key takeaways

Every stakeholder must be included in cross-functional teams, including those who may not appear to be actively participating in the project. Stakeholders are those who stand to profit or lose from the team’s efforts. As a result, guaranteeing their engagement is critical since they may have an impact on a team’s performance.

Business leaders, managers, and important cross-functional team members are responsible for successfully expressing the team’s relevance, goals, and priorities to all stakeholders.

2. Apple.

Apple departs from the typical authoritarian leadership paradigm by allowing each team member to endorse ideas, question perspectives, and jointly develop their thinking for ideal solutions.

To see all the cross-functional work and the relationships we’ve forged come together in one product makes me incredibly proud,” says Jason, Wireless Software Engineering Manager at Apple.

Apple’s dedication to improving the user experience extends beyond the surface, with teams tasked with simplifying product journeys across the supply chain and sales channels.

They collaborate cross-functionally with other Apple teams to identify ways to improve procedures, such as making it easier for customers to order a product online and pick it up in-store.

How cross-functional teams support Apple

Apple used a cross-functional team to design the breakthrough iPhone. They pulled together professionals from several areas throughout the company to launch what would become a smartphone revolution.

It is now widely recognised for its advancements in hardware, software, and services. Apple grew from 8,000 people and $7 billion in revenue in 1997 to 164,000 employees and $394 billion in revenue by 2022.

What are the key causes behind Apple’s huge success? Its organisational culture and leadership approach encourage cross-functional cooperation.

Key takeaways

Collaboration is more than simply teamwork; it includes passionate and collaborative debates. Employees in retail, hardware, and marketing teams may focus on diverse topics, but the ideals of fair and honest communication remain consistent.

Cross-functional collaboration is essential since no one team is accountable for a product or service on its own. Even a single module of a new product may need the collaboration of hundreds of professional teams. Nonetheless, every team works towards a shared goal: to provide an exceptional client experience.

3. Nokia

Nokia’s dedication to cross-functional cooperation is reflected in its recruiting strategy, which prioritises individuals who have led or worked in cross-functional teams across various locations. In addition, the company’s cross-functional teams use agile development techniques daily.

How cross-functional teams contribute to Nokia

Nokia Bell Labs’ leadership promoted cross-functionality by collecting scientists and engineers with diverse skill sets. This effort fostered a risk-tolerant organisational culture that saw failure as an essential component of progress. This resulted in the discovery of the vacuum tube, a device that transformed several industries.

Today, Nokia remains a telecommunications technology innovator, with its network infrastructure business experiencing extraordinary success (€10.0 billion in revenue; 14% YoY). This amazing expansion is powered by rising demand for Nokia’s cutting-edge 5G and cloud networking solutions.

Key takeaways

The more people in your various departments grasp the fundamentals of each other’s specialisations, the more productive your entire firm will be. It is advantageous for every firm when, for example, the sales staff knows how the finance department handles supplier payments.

4) Cisco

Cisco, a leading example of cross-functional team development, shifted its organisational structure from a command and control system to a collaborative and organic work environment.

Cisco has created a bridge between siloed architecture experts and customer-facing staff in diverse groups across the company,” says Sean Worthington, Vice President of IT, Operational Excellence and Service Enablement, Cisco.

Their HR strategy incorporates lower-level management input into top-level decision-making, fostering a collaborative atmosphere. This change allows its teams and divisions to think together, boosting the dissemination of innovative product innovations and technologies throughout the organisation.

How cross-functional teams contribute to Cisco

Cisco’s cross-functional teamwork pays off, as the business becomes one of the top router security providers in 2022. Their methodology drives the creation of unique items and allows them to quickly launch game-changing products to the market, surpassing competitors.

Key takeaways

Cisco’s approach to cross-functional collaboration is multidirectional, avoiding a rigid top-down or bottom-up structure. It guarantees that ideas do not come only from executives or top management, supporting involvement at all organisational levels and encouraging the generation of new ideas.

Achieve Effective Cross-Functional Collaboration With GGP

In today’s complex business environment, effective cross-functional collaboration is not merely a desirable trait; it’s a competitive advantage. Organizations that can seamlessly bring together teams from various departments to work towards common objectives are better equipped to innovate, adapt, and succeed.

At GGP, we know that effective collaboration is essential for achieving organizational goals. That’s why our strategy planning, execution & implementation offers a comprehensive solution to enhance cross-functional teamwork.