Team Performance

What Is Cross-Functional Collaboration? Best Practices + Success Stories 

Dovile Miseviciute ·

Passionate content marketer looking to bring better solutions to the project management space. 2020 - Present Marketing specialist at Teamhood. 2014 - 2020 Marketing manager for Eylean.

cross-functional collaboration

Have you ever looked at a high-performing company and wondered, “What’s behind their success? Could it be a smart marketing strategy? Or exceptional talent?”

What if it’s none of the above but a well-executed cross-functional collaboration?

It’s not an exaggeration to say that cross-functional collaboration has the power to boost innovation and efficiency in modern organizations. 

According to Deloitte Insights, 83% of digitally maturing companies use cross-functional teams, compared to 71% of developing companies and 55% of early-stage organizations. 

If executed properly, cross-functional collaboration can turn a company from a collection of isolated information silos into a unified, streamlined organization in which teams work in perfect synergy. 

If you believe your company can benefit from cross-functional collaboration, this detailed article is for you. We’re going to explore:

  • The definition of cross-functional collaboration
  • The most common advantages and challenges 
  • Some best practices for effective cross-collaboration
  • Advanced techniques for promoting team cohesion and unity
  • Stories of successful cross-functional collaboration
  • And more

What is cross-functional collaboration?

Cross-functional collaboration happens when team members from different departments within a company come together on a project. They combine their varied skills to spark new ideas and solve problems in creative ways. This approach helps break down the usual barriers between departments, which can lead to improved efficiency and innovation.

Let’s say a company is launching a new product, and to guarantee a successful launch, it assembles a cross-functional team that consists of:

  • The Head of Product – they outline the product’s capabilities and vision.
  • The Head of Customer Support – they bring insights into customer needs and preferences.
  • The Product Marketing Lead – they strategize on how to price and market the product to the target audience.
  • The Lead Designer – they focus on the aesthetic and user experience aspects.
  • The Lead Developer – they work on bringing the product concept to life.

Making any sense so far? Good! Let’s proceed! 

Advantages of cross-functional teams

Here are some of the key benefits of leveraging cross-functional teams:

1. Innovation and creativity will skyrocket 

The Harvard Business Review has found that organizations with higher diversity levels see a 19% increase in innovation revenue. Why is that? By blending diverse perspectives and skills, cross-functional teams become hotbeds of creativity and innovation. 

2. A boost in employee engagement and morale

Cross-functional teams do wonders for morale and engagement. They create an environment where everyone feels their work matters. Gallup’s findings have revealed that companies with engaged teams report a 21% boost in profitability

3. Enhanced workflow efficiency 

Cross-functional collaboration leads to more efficient and effective workflow management due to the combined intelligence of the team. Team members, each with their unique expertise, streamline the creative workflow process by introducing new efficiencies and insights. 

4. Broader skill development and knowledge sharing

When everyone learns from each other, people get better at what they do, and useful tips and information are shared easily. This helps avoid the huge $31.5 billion loss that big companies face every year because they don’t share knowledge well.

cross-functional collaboration
Source: Harvard Business Review

Now that we have gone over the most important advantages of cross-functional collaboration let’s mention some of the challenges that might arise. 

Challenges and ways to overcome them

Getting rid of internal silos and replacing them with cross-functional teams can smooth out operations, but don’t expect immediate results. There’ll likely be some bumps as everyone gets used to a new workflow design. 

Here are some potential challenges you might have to face:

Challenge #1: Overcoming the silo mentality

Solution: Promote a culture of openness and teamwork through regular cross-departmental meetings, workshops, and mixed-team projects.  

Challenge #2: Prioritization issues

Solution: Use clear prioritization methods. By setting definite goals and roles, everyone can concentrate on important tasks together.

Challenge #3: Aligning teams to the organization’s overall strategy

Solution: Holding regular sessions to align team efforts with the company’s strategy can bridge the gap between day-to-day tasks and overarching goals. 

Challenge #4: Promoting a positive and supportive team culture

Solution: Promote open lines of communication, recognize and celebrate achievements together, and set aside time for team-building activities.

Challenge #5: “Too many cooks in the kitchen”

Solution: Outline that, although everyone’s contributions are appreciated, the final say will come from a specifically chosen person.

cross-functional collaboration
Source: CGS

Now it’s time to explore a few useful tips for effective workflow management that all managers should know about. 

5 tips on cross-collaboration for effective workflow management 

There’s no doubt: Effective cross-functional collaboration is vital for your team’s productivity and innovation. 

Here are five expert tips that, if implemented well, can boost teamwork across various departments and specialties.

Tip #1: Establish clear roles and responsibilities 

Badly defined roles and responsibilities can only add confusion among team members and prevent the project from running smoothly. That’s why it’s so important to define each team member’s role and what they are accountable for from the outset. 

Tip #2: Cross-training and team-building

You can’t have a cohesive cross-functional team without investing in cross-training and team-building activities. Through cross-training, team members can develop empathy for their colleagues’ challenges, while team-building can create stronger bonds between team members and make them work more efficiently. 

Tip #3: Regular feedback and adaptation

Having an open line of communication will allow you to quickly identify potential improvements and address any issues that may arise on time. At the same time, by asking for feedback, you’re making team members feel more valued and heard. 

Tip #4: Use the right communication and collaboration tools

Clear communication and collaboration channels are crucial for a cross-functional team’s success. Misunderstandings can lead to delays and impact morale, so it’s vital to establish channels that allow for the easy exchange of ideas and information. 

This includes regular check-ins, open forums for discussion, and selecting technology that supports both synchronous (for immediate problem-solving) and asynchronous collaboration tools (for flexible contributions) communication. The right technology should be user-friendly so that the entire team can adopt it quickly.

Collaboration software, such as Teamhood, stands out for its comprehensive features designed to improve workflow design by streamlining team communication and task management. You can assign tasks with ease, monitor progress through item watching, start discussions via comments, and share files directly within tasks. Check out Teamhood’s features to learn more. 

teamhood task details

With that out of the way, let’s go over some advanced techniques that promote team cohesion and unity. 

Advanced techniques for promoting team cohesion and unity

It’s a question as old as time: Why do some teams work more effectively, and others fall behind? 

A great deal of research has been done on the topic, and it has been identified that team cohesion and unity are one of the primary answers to this question. In fact, hundreds of studies have demonstrated a connection between cohesion and positive team outcomes. 

So, what are some advanced techniques you can implement that can promote team cohesion and unity in your cross-functional team? Here are several: 

  • Hold trust and open communication workshops: Host workshops where team members get to know each other better and feel comfortable sharing. This builds a solid foundation of trust.
  • Invest in conflict resolution training: Give your team conflict resolution training to help them deal with disagreements in a positive way. This training should teach them about seeing conflicts as chances to grow. 
  • Promote collaborative decision-making: Switch to a team decision-making style where everyone gets a say. This way, you’re considering a wide range of views, which means everyone feels part of the outcome.
  • Conduct psychological safety assessments: Make psychological safety a top priority by regularly checking in with your team. These checks help spot when people might be holding back.

Let’s now explore the unique dynamics and solutions for cross-functional collaboration in global and virtual settings.

image
Source: Nectar

Cross-functional collaboration in global and virtual settings

The COVID-19 crisis has disturbed the nature of work. As of 2023, 12.7% of full-time employees work from home, while 28.2% work a hybrid model. By 2025, 32.6 million Americans are predicted to work remotely. What’s more, 16% of companies operate fully remote.

Cross-functional collaboration in global and virtual settings brings unique challenges and opportunities for companies. In addition to challenges like overcoming the silo mentality and prioritization, there’s the added challenge of having to deal with cultural differences, technical issues, team connection, and more. 

Let’s look at some of the common challenges you might come across and offer some practical advice for overcoming them. 

Cultural differences in cross-functional teams

In cross-functional teams, especially those that span across global locations, cultural differences can impact collaboration and communication. For example, team members might have different communication styles, different approaches to hierarchy and authority, or different attitudes toward time management and deadlines. 

Is there anything you can do to deal with these challenges? 

Luckily, yes!

Some possible solutions include: 

  • Invest in workshops or training sessions to help team members understand and appreciate the cultural backgrounds of their colleagues.
  • Establish clear protocols for communication that consider the diverse preferences of team members. This might include agreeing on a common language for communication, setting expectations around email response times, and using visuals or detailed agendas to aid understanding.
  • Recognize and accommodate the different work-life balance norms and public holidays across cultures. 
  • Schedule regular team meetings and one-on-one check-ins to make sure all voices are heard. 

Technical challenges 

Technical challenges in cross-functional teams operating in a virtual setting can range from issues with online collaboration tools to data security concerns. 

Some possible solutions include: 

  • Choose collaboration and project management tools that are intuitive and accommodate the needs of all team members. 
  • Prioritize software and agile collaboration tools that offer cross-platform compatibility to make sure everyone, regardless of their device or operating system, can participate fully.
  • Implement robust security protocols and provide training on data protection best practices to safeguard sensitive information.
  • Offer regular training sessions on the tools the team will be using and create a support system for dealing with any technical issues that may arise.

Team connection difficulties 

The downside of virtual teams is that the physical distance can lead to feelings of isolation and disconnection, which further impacts team morale and productivity. In fact, it’s been found that remote workers often struggle with “social pain” that activates the exact same brain regions as physical pain.

To establish stronger team connections and healthier remote teamwork, consider these possible solutions: 

  • Use video conferencing tools to hold regular meetings that focus on work and allow team members to socialize and connect on a personal level.
  • Set up informal digital spaces for team members to chat and share non-work-related news and interests.
  • Acknowledge individual and team milestones publicly within the team or organization to build a culture of appreciation and recognition.
  • Promote an environment where team members feel comfortable sharing their thoughts, concerns, and suggestions. 
cross-team collaboration
Source: Piktochart

Visual collaboration software can also aid in such difficulties as it brings in an easy way to track and review work.

Before we conclude this extensive post, let’s look at two workflow examples of cross-functional collaboration to get an idea of how this approach works in real life. 

Success stories of cross-functional collaboration (creative workflow process examples) 

Spotify

One of the most talked about workflow examples of successful cross-functional collaboration is Spotify’s squad model. Spotify organizes employees into multi-disciplinary squads that function like mini-startups. 

Each squad is responsible for a specific aspect of the product. These squads consist of people with different expertise, like software development, design, and product management, so that they can rapidly prototype and iterate on features. This collaborative way of working allows Spotify to stay agile and continuously improve its service to meet user needs. 

Apple 

Apple’s story of creating the iPhone is another example of successful cross-functional collaboration and effective workflow design. To develop the first iPhone, a diverse team of engineers worked together on “Project Purple” over two years. During this time, they managed to overcome several obstacles, from miscommunications to high-pressure deadlines to the creation of the prototypes and refining them based on feedback from managers, executives, and, of course, Steve Jobs. 

People were even allowed to try new roles and skill sets. For example, the person who led the marketing strategy was an engineer, not a marketing specialist. Despite the numerous challenges, the cross-functional team managed to deal with every roadblock and develop the most successful smartphone of all time. 

Apple team structure
Source: PLA

Ready to put cross-functional collaboration into action?

Embracing cross-functional collaboration isn’t just a strategy; it’s a game-changing journey for any organization that aims to break down silos and boost innovation and efficiency. 

Armed with the insights shared, you’re now better equipped to overcome the challenges and leverage the immense benefits of bringing diverse teams together. From enhancing workflow design to promoting a culture of open communication and mutual respect, the path to collaborative success is clear. 

Ready to put cross-functional collaboration into action? The potential for positive change is immense, and the time to start is now.

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