Why Most Cross-Functional Teams Fall Short

Mickey Anderson (0:00)

Working across functions is a skill a leadership team builds with practice and structured time on a real objective. Picture this, we've got marketing, sales and customer success at a growing organization. Marketing has their plan and numbers built around lead volume, sales around close rate, and success around retention. Now, three plans, three sets of numbers, and these three leaders did not sit down to build their plans together even though they are all interdependent. That is a common scene across so many organizations, and it highlights a key problem we see time and time again. A lack of cross-functional collaboration, which ultimately means plans and numbers are built in silos and don't necessarily work together to achieve business objectives. That's what we're going to be talking about today. We've all been there at end of month where all of a sudden, the plan no longer makes sense, or there's friction coming from other departments and their competing priorities. Everyone finds out about each other's plans and what's going on too late to make any measurable impact. When we look at these leaders independently, they're all doing a good job running their functions well. The problem comes from an organizational standpoint of how each of these come together to achieve business outcomes and move us all in the same direction instead of causing friction between functions. By the end of this episode, you'll know what has to be in place for your leaders to plan and solve problems together and how to build that skill before the stakes are real. So let's go back to our marketing, customer success and sales example. Marketing knows which messages and channels are bringing customers in before they speak to anyone. Sales knows what was promised to close a deal, what objections are coming up, and what kind of customers are buying quickly and which ones are stalling. Customer success knows what the customer actually experiences after they buy and what they needed that wasn't promised or what was promised that wasn't delivered and when customers start to lead. When those plans are built separately, each one improves its own numbers. Marketing will bring in more leads, including leads that maybe aren't a good fit. Sales will come up with some sort of promise that delivery doesn't necessarily keep, and customer success inherits this gap and spends its time managing expectations it didn't set. Each of these functions can hit their targets, but that doesn't necessarily mean the company is going to hit its growth plan. So let's talk about what happens when we bring these three leaders together to build their plans together. Better ideas. We get more of the problem visible because the options coming to the table are coming from different pictures with different perspectives. We get better plans because assumptions are tested by the people who actually hold the information. Sales can tell marketing, which leads actually close. And customer success can tell sales, which promises are not being delivered. We get better solutions because handoffs are designed together before anything breaks. And you end up with better execution because the people who are delivering the plan are building it together so they understand the intent behind it and they own it. This affects planning and strategy just as much as it does problems. Look, many annual and quarterly plans are built inside each function and then put together at the end, or from a leadership team at the top with zero context from anyone actually doing the work. The plans look good on paper, but they cause friction against each function and those competing priorities along the way.

Let's talk about some evidence on this. Benham to Breezy published a study in Harvard Business Review of 95 teams in 25 leading companies. Nearly 75 percent of cross-functional teams were dysfunctional. They failed on at least three of five criteria. One, meeting a planned budget.

Two, staying on schedule.

Three, adhering to specifications.

Four, meeting customer expectations. And five, maintaining alignment with the company's corporate goals. The same research found that projects with strong governance support, meaning a senior cross-functional group or a single executive champion behind them had a 76 percent success rate.

So that first number, the 75 percent of cross-functional teams being dysfunctional tells us where the problem is. The second number, that 76 percent success rate with a champion or a cross-functional team tells us where the solution lies. Working cross-functionally doesn't happen on its own. Leaders have to make time for it and they have to run it well. What has to be in place to create strong cross-functional collaboration across an organization? There are three key conditions we're going to walk through. The first is context shared in advance.

Leaders can't think well when a problem is thrown in front of them with competing priorities and opinions all shared at the same time. When the context arrives in the meeting, most of the meeting becomes dedicated to the briefing and not the problem solving. And then thinking gets rushed and postponed decision making happens. You can send a short brief ahead of time so everyone has context in advance and they can digest it and reflect upon it before showing up. Leaders will think better, come up with better solutions, and it will often bring out quieter voices in the room.