Cross-functional team
Encyclopedia
A cross-functional team is a group of people with different functional expertise working toward a common goal. It may include people from finance, marketing, operations, and human resources departments. Typically, it includes employees from all levels of an organization. Members may also come from outside an organization (in particular, from suppliers, key customers, or consultants).
Cross-functional team
s often function as self-directed teams responding to broad, but not specific directives. Decision making
within a team may depend on consensus, but often is led by a manager/coach/team leader.
, tactical, and operational decisions, new procedures have started to emerge that work best with teams.
-level objectives drove strategic business unit
(SBU) objectives, and these in turn, drove functional level objectives. Today, organizations have flatter structures, companies diversify less, and functional departments have started to become less well-defined. The rise of self-directed teams reflects these trends. Intra-team dynamics tend to become multi-directional rather than hierarchical. Interactive processes encourage consensus within teams. Also the directives given to the team tend to become more general and less prescribed.
In many cases, the team would make unstructured strategic decisions—such as what markets to compete in, what new production technologies to invest in, and what return on investment to require; tactical decisions like whether to build a prototype, whether to concept-test, whether to test-market, and how much to produce; and structured operational decisions like production scheduling, inventory
purchases, and media flightings. In other cases, the team would confine itself to tactical and operational decisions. In either case it would need information associated with all three levels.
, sorting information based on importance, hiding complex statistical procedures from the users, giving interpretations of results, and providing clear explanations of difficult. Data visualization
systems can present complex results in an intuitive manner.
’s views on Management by objectives
, business decision making has become more goal-oriented. Managers have come to view decision-making generally, and strategic thinking in particular, as a multi-stage process that starts with an assessment of the current situation, defining objectives, then determining how to reach these objectives. Management by objectives took this basic scheme and applied it to virtually all significant decisions.
Today many firms have started to opt for a less structured, more interactive approach. One way of implementing this involves using self-directed cross-functional teams. Proponents hope that these teams will develop strategies that will re-define industries and create new “best practice
”. They think that incremental improvements do not suffice.
Cross-functional teams, using unstructured techniques and searching for revolutionary competitive advantages, allegedly require information systems featuring increased interactivity, more flexibility, and the capability of dealing with fuzzy logic
. Artificial intelligence
may one day be useful in this aspect.
Cross-functional team
Team
A team comprises a group of people or animals linked in a common purpose. Teams are especially appropriate for conducting tasks that are high in complexity and have many interdependent subtasks.A group in itself does not necessarily constitute a team...
s often function as self-directed teams responding to broad, but not specific directives. Decision making
Decision making
Decision making can be regarded as the mental processes resulting in the selection of a course of action among several alternative scenarios. Every decision making process produces a final choice. The output can be an action or an opinion of choice.- Overview :Human performance in decision terms...
within a team may depend on consensus, but often is led by a manager/coach/team leader.
Effects
The growth of self-directed cross-functional teams has influenced decision-making processes and organizational structures. Although management theory likes to propound that every type of organizational structure needs to make strategicStrategy
Strategy, a word of military origin, refers to a plan of action designed to achieve a particular goal. In military usage strategy is distinct from tactics, which are concerned with the conduct of an engagement, while strategy is concerned with how different engagements are linked...
, tactical, and operational decisions, new procedures have started to emerge that work best with teams.
Less unidirectional
Up until recently, decision making flowed in one direction. Overall corporateCorporation
A corporation is created under the laws of a state as a separate legal entity that has privileges and liabilities that are distinct from those of its members. There are many different forms of corporations, most of which are used to conduct business. Early corporations were established by charter...
-level objectives drove strategic business unit
Strategic business unit
In essence, the SBU is a profit making area that focuses on a combination of product offer and market segment, requiring its own marketing plan, competitor analysis, and marketing campaign.A Strategic Business Unit emerges at the cross-over between:...
(SBU) objectives, and these in turn, drove functional level objectives. Today, organizations have flatter structures, companies diversify less, and functional departments have started to become less well-defined. The rise of self-directed teams reflects these trends. Intra-team dynamics tend to become multi-directional rather than hierarchical. Interactive processes encourage consensus within teams. Also the directives given to the team tend to become more general and less prescribed.
Greater scope of information
Cross-functional teams require a wide range of information to reach their decisions. They need to draw on information from all parts of an organization’s information base. This includes information from all functional departments. System integration becomes important because it makes all information accessible through a single interface.Greater depth of information
Cross-functional teams require information from all levels of management. The teams may have their origins in the perceived need to make primarily strategic decisions, tactical decisions, or operational decisions, but they will require all three types of information. Almost all self-directed teams will need information traditionally used in strategic, tactical, and operational decisions. For example, new product development traditionally ranks as a tactical procedure. It gets strategic direction from top management, and uses operational departments like engineering and marketing to perform its task. But a new product development team would consist of people from the operational departments and often someone from top management.In many cases, the team would make unstructured strategic decisions—such as what markets to compete in, what new production technologies to invest in, and what return on investment to require; tactical decisions like whether to build a prototype, whether to concept-test, whether to test-market, and how much to produce; and structured operational decisions like production scheduling, inventory
Inventory
Inventory means a list compiled for some formal purpose, such as the details of an estate going to probate, or the contents of a house let furnished. This remains the prime meaning in British English...
purchases, and media flightings. In other cases, the team would confine itself to tactical and operational decisions. In either case it would need information associated with all three levels.
Greater range of users
Cross-functional teams consist of people from different parts of an organization. Information must be made understandable to all users. Not only engineers use technical data, and not only accountants use financial data, and not only human resources personnel use HR data. Modern organizations lack middle managers to combine, sort, and prioritize the data. Technical, financial, marketing, and all other types of information must come in a form that all members of a cross-functional team can understand. This involves reducing the amount of specialized jargonJargon
Jargon is terminology which is especially defined in relationship to a specific activity, profession, group, or event. The philosophe Condillac observed in 1782 that "Every science requires a special language because every science has its own ideas." As a rationalist member of the Enlightenment he...
, sorting information based on importance, hiding complex statistical procedures from the users, giving interpretations of results, and providing clear explanations of difficult. Data visualization
Data visualization
Data visualization is the study of the visual representation of data, meaning "information that has been abstracted in some schematic form, including attributes or variables for the units of information"....
systems can present complex results in an intuitive manner.
Less goal dominated
Since the publication of Peter DruckerPeter Drucker
Peter Ferdinand Drucker was an influential writer, management consultant, and self-described “social ecologist.”-Introduction:...
’s views on Management by objectives
Management by objectives
Management by Objectives is a process of defining objectives within an organization so that management and employees agree to the objectives and understand what they need to do in the organization....
, business decision making has become more goal-oriented. Managers have come to view decision-making generally, and strategic thinking in particular, as a multi-stage process that starts with an assessment of the current situation, defining objectives, then determining how to reach these objectives. Management by objectives took this basic scheme and applied it to virtually all significant decisions.
Today many firms have started to opt for a less structured, more interactive approach. One way of implementing this involves using self-directed cross-functional teams. Proponents hope that these teams will develop strategies that will re-define industries and create new “best practice
Best practice
A best practice is a method or technique that has consistently shown results superior to those achieved with other means, and that is used as a benchmark...
”. They think that incremental improvements do not suffice.
Cross-functional teams, using unstructured techniques and searching for revolutionary competitive advantages, allegedly require information systems featuring increased interactivity, more flexibility, and the capability of dealing with fuzzy logic
Fuzzy logic
Fuzzy logic is a form of many-valued logic; it deals with reasoning that is approximate rather than fixed and exact. In contrast with traditional logic theory, where binary sets have two-valued logic: true or false, fuzzy logic variables may have a truth value that ranges in degree between 0 and 1...
. Artificial intelligence
Artificial intelligence
Artificial intelligence is the intelligence of machines and the branch of computer science that aims to create it. AI textbooks define the field as "the study and design of intelligent agents" where an intelligent agent is a system that perceives its environment and takes actions that maximize its...
may one day be useful in this aspect.
See also
- Ambidextrous organizationAmbidextrous organizationOrganizational ambidexterity refers to an organization’s ability to be efficient in their management of today’s business and also adaptable for coping with tomorrow’s changing demands.- Origin and Development :...
- Organization designOrganization designOrganization design can be defined narrowly, as the process of reshaping organization structure and roles, or it can more effectively be defined as the alignment of structure, process, rewards, metrics and talent with the strategy of the business...
- Organizational structureOrganizational structureAn organizational structure consists of activities such as task allocation, coordination and supervision, which are directed towards the achievement of organizational aims. It can also be considered as the viewing glass or perspective through which individuals see their organization and its...
- Total quality managementTotal Quality ManagementTotal quality management or TQM is an integrative philosophy of management for continuously improving the quality of products and processes....