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Tim Copeland

Managing a Cross-Functional Team? Here's Everything You Must Know

Building cross functional teams that are a success is hard, but not impossible. Here's nearly everything you must know to manage a cross functional team.

In 75% of cases, cross-functional teams are dysfunctional. But in 2022, an effective cross-functional team that can take care of a project from top to bottom is a boon every company seeks to gain.

One way or another, a cross-functional agile team is how you can build a business using that ‘less is more philosophy’ — achieving tangible results with a limited number of people working on your project. Yet although it might sound like a blessing in disguise, there are lots of adjacent traps that can, sadly but inevitably, derail your project or turn your teamwork into a world of chaos.

But with cross-functional teams being more relevant than ever, having a perfect grasp of what this engine is and how you can make it run is the way to get ahead of the competition. In this article, you will see the concept dissected to the tiniest detail, from general definitions to specific ways you can be among that 25% margin of successful cross-functional collaboration. Let’s get to it then.

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What is a cross-functional team?

Understanding what is meant by a cross-functional team in project management is no rocket science. In fact, the term itself is self-explanatory: it is a team that performs different functions and can, in a sense, exist independently from the rest of the company. In other words, you will be dealing with a group of people coming from various departments and bringing different skill sets to the table — from development and testing to marketing and sales.

Here’s a simple way to memorize the meaning of a cross-functional team: think of it as if it were a vegetable ragout — different vegetables put together in a single pan, mixed to make a single meal and give a specific experience to the end ‘consumer’. That’s a weird comparison, right? But weird things tend to be memorable.

As a rule, coming from different functional areas of the business, cross-functional teams work shoulder-to-shoulder and bring different functional expertise to contribute to time-sensitive projects and solve organizational challenges. In a way, they break organizational silos, improve problem solving, and often stand behind innovative solutions.

Now, with the definition of a cross-functional team sitting firmly in place, let’s look at what that team might look like at your company.

Cross-functional team example

Suppose you want to go live with a big bang software update or a set of features as you scale the company and redefine your business model. In order to reach the desired goal, you need developers to build the new features, product designers to make those features ‘digestible’ to say the least, marketers to present them to your target audience, and salespeople — well, to sell them. When such an agenda is put into a single multi-level project, it requires collective effort and a well-managed cross-functional team to make it happen.

What are the characteristics of a great cross-functional team?

Having a cross-functional team assembled is never a guarantee that your project is going to fly. In fact, it is always a good idea to check if you put the right people together. They will be sailing in one boat, after all. Here is a simple checklist you can go through.

Do they prioritize cross-functional team collaboration over competition?

Cross-functional team members have a tendency to get caught up in the blanket pulling game, especially when it comes to financing. And with matters like these, you really want to have a flat team structure for everyone to feel equal, but also a clear decision-making process defined: what is more important for your project, user experience (design) or functionality (development)? Understanding these things prior to project launch will help you avoid unnecessary competition and simplify the decision-making process.

Does the project team leader have good communication skills?

When it comes to cross-department projects, you need your cross-functional team leadership to be good at connecting the dots and bringing people together. Truth is, not every cross-functional project team has a leader, to begin with, but it is always best to put someone in charge of resource allocation, project management, and progress monitoring.  

Do team members need mentoring?

Not everyone is fit to be a part of an agile cross-functional team, even if they have the expertise required for the project. The members of a cross-functional team should have the right seniority level to give them confidence enough to make their own decisions and relevant experience to do all of their work without any hand-holding from their colleagues.

The benefits of a cross-functional team

In recent research, Deloitte looked at the companies that moved to cross-functional teams and found that 53% of them experienced a considerable improvement in performance. At the same time, 31% of the respondents said they do almost all of their work in teams.

With the diverse project requirements that drive businesses today, building a cross-functional team is oftentimes the go-to strategy industry leaders follow. But Behnam Tabrizi from Harvard Business Review found that an overwhelming majority of them still have at least three weaknesses that make them suffer a low blow.

Here are the pros and cons you need to be aware of before gathering such a team.

Cross-functional team: advantages and disadvantages

PRO: Increased innovation and creativity

With a cross-functional team, you usually get to work with people from all walks of life, presenting unique interests and experiences. And when it comes to a business, this means that every individual will be bringing fresh ideas to the table, depending on the department they represent.

This usually also has an impact on the speed of work. When developing a project together, having brainstorming sessions, team members can come up with solutions, dismiss no-go scenarios, and support promising ideas on the spot. They can exchange unique takes on why they believe the project will or will not be able to go further, thus raising its chances for success.  

PRO: High employee engagement

We’re talking about employee engagement in relation to the company and each other at the same time.

First, with the level of accountability that usually comes with working in a cross-functional team, people can always see that their say in the project matters. Additionally, every little bit of work done on the project makes a difference and can bring it closer to the finish line. It is this level of responsibility and involvement that gets people genuinely interested in seeing their initiatives succeed.

Second, a cross-functional environment always encourages increased collaboration and communication with people openly sharing their thoughts, speaking out, and, eventually, bonding to form a tight-knit community. But that is not to say that the tight-knit community will get separated from the rest of the company.

PRO: Efficient resource use

If there is one thing the very notion of a cross-functional team refers to, it’s this: a single budget.

And this is actually another reason why this model of work is starting to look attractive to more and more companies.

Rather than making separate budgets and scattering them all across different departments, you can create a single project budget that will cover the needs of all the participating departments. Even if this business model does not mean saving money it certainly means simplified project processes.

CON: Challenges in cohesion

Assembling a cross-functional team is not the hardest part of the job. What comes next, enabling and empowering synergy, is much more difficult. After all, there is always a flip side to the coin. And in this case, it is the differences everyone needs to overcome in order to make a strong and efficient team.

While the people that come together to work on a single project will find it an interesting experience because of their differences, they will also sometimes have trouble seeing eye to eye with each other for that same reason.

CON: Department clashes

As mentioned above, one of the risks that accompany cross-functional work is the blanket pulling game. Especially when there is no cross-functional team management in place.

Every expert on the team will have an opinion on how they should handle the project and what needs to go first in it. And more often than not, this creates a solid ground for disagreements which can only be resolved through transparent communication.

How to build a strong cross-functional team

Building a strong cross-functional team usually goes down to a few things: securing a strong support system, understanding challenges, and knowing best practices. In fact, the projects that have good executive support and efficient collaboration have a very convincing success rate of 76%, while projects with insufficient support are only successful in 19 cases out of 100.

What challenges do cross-functional teams face?

  • Scarce accountability

As you might have noticed, a typical cross-functional (scrum) team will usually be heavily reliant on the sense of accountability. Making confident decisions, being able to explain them, and, most importantly, taking responsibility in case of failure is a sign of a mature cross-functional team.

So when your team members lack this sense of accountability and do not necessarily understand just how much value their part in the project holds — be ready to take this as yet another challenge to overcome.

  • Lack of trust

Coming from different departments, your team members might find it difficult to trust each other’s decisions, especially if they did not really have much contact prior to the project launch. This is especially applicable for scaleups and enterprises, where people might not even know each other and thus feel somewhat uncertain about relying on each other’s expertise.

Naturally, this is one of the challenges that goes away with time, especially if there are some team building or brainstorming sessions taking place at the beginning of the project. But it’s important to account for this roadblock if you want to overcome unwelcome surprises.

  • Commitment issues

More often than not, the people on your cross-functional team will be involved in other projects, which they might prioritize due to a variety of reasons. As a result, they will look at the cross-functional project as if it were an extra something to work on when everything else has been taken care of. Needless to say, this smells like project failure.

In order to avoid such a challenge, it is paramount that your project goals are aligned with your company goals. This will help everyone understand what tasks to prioritize and why.

  • Fear of judgment

Creating a healthy work environment where everyone feels heard and respected is a building block of a successful project. Everyone working within a cross-functional team needs to feel comfortable with pitching their ideas and having them challenged. At the end of the day, the question is what is best for the project, not whose idea wins the race.

When people feel comfortable with debating and know how to keep those debates professional, a cross-functional environment can bring about innovative ideas and disruptive solutions.

Now, once you have strong executive support standing behind your project and a firm understanding of the challenges that might arise along the way, it’s time for you to explore the tips and tricks of making a cross-functional team succeed.

Best practices for managing a cross-functional team

Managing a cross-functional team is like navigating a boat — if you know the right route, you will be able to stay away from storm zones and enjoy sunshine most of the time. Here are the do’s that will get you on that route.  

1. Assemble the team and choose a leader

Experience, expertise, seniority, availability, soft skills — this is the shortlist you need to go through when selecting new people for your cross-functional team.

How do you know that a team is cross-functional? That’s an easy one. If you feel like the group of people you have put together can get the multi-level project from point A to point B with no reinforcements along the way, you have a strong cross-functional team there.

But there is only so little a group of people can do without a leader showing the way and having the final say when it comes to controversial decisions. So be sure to find a leader who will be the glue holding that team together.

2. Set project goals

Even when working in a cross-functional team, everyone needs to have their own individual goals to successfully complete their part in the project. Naturally, in order to set clear goals for themselves, everyone needs to have a solid understanding of the goals driving the project.

Project goals, in turn, need to be aligned with the high-level company goals so everyone understands the purpose of the project and the potential value it can bring to the company as a whole.

In a recent report, the PMI stated that insufficient or poorly defined project milestones and objectives to measure progress make the top reason for project failure, dragging 37% of projects to the ground. And a cross-functional project has all the tools to exacerbate this threat.

3. Do realistic planning

In order to be realistic when planning a project for your cross-functional team, you need to have sufficient insight into people’s capacity. In short, capacity, in this case, refers to the hours your selected team members still have free.

It’s good to have a tool that can give you a bird’s eye view over the hours each person has available on any given day so you can know for sure if the expert you chose has the time to work on your project. Here’s what that capacity board looks like in Runn.

managing a cross-functional team

With those insights into capacity, you will know whether the existing cross-functional team can finish the project on time or whether it requires some reinforcements to meet all the deadlines.

4. Manage workload

Once you successfully finish capacity planning, you will need to effectively distribute the workload across your team. This is relatively easy when you see who is already overbooked and who still has a few hours free and can take on an additional task.

cross-functional team workload

Understanding the existing workload is also crucial if you want to be sure to distribute work in a fair manner and give everyone enough space for rest and personal life. After all, when things get hectic and people start working overtime, employee burnout becomes a real danger that can sweep any project off its feet. Maintaining a healthy work environment and respect for personal life is another key to building a sustainable team that can bring lasting results.    

5. Leave some wiggle room

One of the things many project plans miss is a little grey area or some wiggle room if you will.

Things can change with any project and any team, be it cross-functional or not cross-functional. People might want to take time off, they might get sick or have some force majeure situation to take care of. And it’s those little things that can sneak through and stop your project dead in its tracks. Accounting for those potential hours when your team members will be unavailable is another thing you need to do for realistic planning.

For your cross-functional team to be effective, everyone needs to know that they can take a break when they really need it and it will not damage the project. At least not to the point where it is out of your control.

6. Ensure continuous project monitoring

When your cross-functional team gets that project ball running, letting things go with the flow is the last thing you want to do if you want to see them succeed, both individually and as a team.

Solid planning is a good start, but expert management along the way is no less important for the simple reason that people will need updates, insights and reports on how they are doing.

This is why the person leading the team has to visualize all the important upcoming milestones, project phases, dependencies, and potential roadblocks for everyone to understand whether the project is going to meet its initial goals and deliverables.  

7. Enable effective communication

Communication always seems like such an easy thing to tackle, an issue you might almost always be certain will never damage your project. Nevertheless, the PMI proves that in 56% of project failure cases, poor communication was a contributing factor.

People might be miscommunicating or avoiding communication under the pretext that certain concepts or decisions are common sense. But in reality, even the smallest things can lead to cracks in project alignment, while communication can be either the solution or the reason behind the problem.

This is why it is crucial to give people access to all the possible communication channels and events, and, most importantly, encourage everyone to use them.

8. Help people bond

As mentioned before, one of the challenges that are common in cross-functional teams is the fact that people are not used to each other in the professional setting. A member of the development team will not necessarily click with a member of the marketing team. But that click is essential for the team to stick together and successfully complete the project.

Luckily, there are lots of bonding activities and experiences you can give to your team members. From team building sessions to online games and from workations to corporate parties — helping team members get to know each other is a great way to speed up all project processes.

9. Prioritize transparency

With the level of independence and accountability that usually drives cross-functional teams, keeping someone in the dark is not the way to build trust. Instead, you need to be open and honest about the state of the project as well as the threats looming over it, if any.

Being transparent with your team will help people effectively communicate and make the right decisions to move the project forward. Not to mention the impact it has on the high level of accountability you will expect everyone to maintain as you move forward with the project goals.

Final thoughts

Cross-functional teams are tricky. But they aren’t impossible. Uncertainty can make it look like a daunting experience but when you know what to expect and how to handle it, solutions arrive even before problems occur. This is why being well-equipped for building and managing cross-functional teams helps you reduce uncertainty and raise your chances for success.

Book a demo to see how Runn can help you on this exciting journey.

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