With the advance of technology and globalization, organizations today must have agility. It doesn’t matter the industry, companies need to be able to adapt to change. As a consultant, I’ve seen this need first hand throughout the tech, retail, and financial industries.
Gone are the days when different departments within a company worked in silos. Companies who still do this, and use a static organization structure, will struggle to survive. They will fall to the competitive advantage of the agile organization.
The problems faced by companies today are too complex to not be agile. The pressure put on from external forces demand a new way of thinking and collaborating.
One way to create agility is through the use of decentralized cross-functional teams (CFTs). A CFT is a team made up of people from different functional areas within the company. These experts work together to achieve a common goal. Over time the team develops synergy, and becomes high performing. Team synergy vastly exceeds the productivity of individual efforts.
When management empowers CFTs to make decisions and self-organize, the teams move fast, really fast. Team autonomy and empowerment promotes an atmosphere of trust, creativity, and worker satisfaction.
One of the greatest benefits of empowered CFTs is their ability to manage chaos. This phenomenon is counter intuitive to our natural reaction to manage chaos. Most of what we learn in business school aligns with the carrot and stick style of management. The more things get out of control, the more we tighten up our grip on the team. As managers, we have to let go of this notion of command and control. We can empower teams while still holding them accountable.
In a recent HBR article, Michael Mankins and Eric Garton describe how Spotify balances employee autonomy and accountability. They write “Companies that take the approach of empowering autonomous teams must find ways to ensure that coordination and connectivity happen among those teams without relying on controlling managers. Again, it’s a matter of managerial art as well as science to achieve alignment without excessive control.”
If you assemble a CFT with people new to such an environment, there will be a learning curve. You can’t expect people to self-organize and make decisions when they are used to being controlled. The key is for CFTs and management to learn a new way of thinking, but this takes time.
Ken Schwaber, who formed the Agile Scrum framework along with Jeff Sutherland, writes “A team requires concrete experience before it can truly understand how to manage itself and take the responsibility and authority for planning and conducting its own activities.”
Below are 12 principles that can help management develop high performing cross-functional teams:
- Create stable cross-functional teams – Creating stable CFTs, dedicated to long-term goals, is necessary for high performance, quality and innovation. To do this you must dedicate resources and provide constant training. Each team member must have knowledge and expertise in a certain functional area. Changing team resources and not allocating for long-term planning is a killer to team performance.
- Provide a clear and compelling purpose – People suffer when they lack purpose. It is the responsibility of management to provide a purpose. People need a purpose because it creates intrinsic motivation. If employees are assigned tasks that have no meaning to them, they will lack motivation. Management should communicate how the goals of the team align with the long-term goals of the company.
- Protect the teams – Run interference and protect CFTs from distractions and skeptics. Management must be committed to the overall purpose of the organization and the CFT. There are always skeptics and people who are resistant to change. It is well advised for management to not include these types on change efforts and new CFTs. Skeptics will cause more harm than good. Staff CFTs with people with positive attitudes who will champion the goals of the team and organization.
- Give teams the help they ask for – With the high performing CFT model, managers don’t tell the team how to do their job. Instead, the teams tell management what they need to be successful. It is the job of management to listen to these requests and do their best to provide the teams with the help they ask for. Again, just because management is not telling teams what to do, it doesn’t mean they shouldn’t hold teams accountable.
- Empower teams to make decisions – Management can hold teams accountable for results, but they need to empower teams to make decisions. The decentralization of authority allows teams and organizations to produce results fast while responding to change. Management is still responsible for telling teams what needs to be done, but the teams are responsible for how it will be done.
- Allow mistakes to be made – Encourage teams to accomplish stretch goals, but do not punish if everything is not achieved. It’s important for management to help drive out fear. When employees are afraid of being punished for mistakes, it kills innovation. The important thing is learning from mistakes. Teams should continually take inventory on how they can improve.
- Use information radiators – On CFTs, everyone needs to see what’s going on and what needs to be done. Having a board that displays visual controls enables and promotes teams to self-direct. Information radiators also let management and outside stakeholders view how the team is doing and how much work is in progress.
- Deliver as fast as possible – Fast product delivery results in increased business flexibility and happy customers. Short value streams eliminate waste and they allow decisions to be delayed. Management should promote the idea of delivering valuable products fast. Often time’s people think that you can’t deliver fast without compromising quality. This is not the case when you build quality and integrity into product development. The fast delivery system does not compromise on quality; in fact it improves quality because consumers get the product faster. This enables consumers to provide feedback sooner which can go back into the design of the product, improving quality.
- Analyze and improve throughput – The best way to optimize an organization is to focus on throughput. The theory of constraints teaches us to find bottlenecks in the system and fix them. Teams should continue analyzing the system, identifying bottlenecks, and removing them. When teams focus on improving non bottleneck areas of the system, it doesn’t help improve throughput. Following the theory of constraints principle, teams can delivery fast.
- Promote quality built into products – In Edward Deming’s book “Out of the Crisis” he writes “Quality comes not from inspection but from improvement of the production process. Inspection, scrap, downgrading and rework are not corrective action on the process”. This means for software development, we need to get away from this notion that QA is this separate process that happens after software development. We should not be inspecting quality into the software through QA. Instead, QA should be happening as part of software development through the use of test driven development and automation. This enables quality to be built up front, instead of through inspection.
- Improve quality by learning from the consumer – In the Agile software development “Scrum” we do product reviews continually with the consumer. This same principle can be implemented throughout the organization. The goal is to feed the consumer reactions and feedback back into the design of the product to improve quality.
- Provide servant leadership – In Scrum, the Scrum Master acts a servant leader. The Scrum Master job is to remove impediments and help the team. This servant leadership practice is a great example for management to emulate. By supporting and helping teams, you foster at atmosphere of empowerment and trust.
For many organizations, the points I listed may be a significant change from their current reality. It’s not easy to put in place all these changes. Even for the modern agile company, agility is an ongoing learning process. If your organization needs guidance, at MacIsaac Consulting we are here to help. From advising leadership, to providing resources, we can guide you on your agile transformation journey.
About the Author: Mike MacIsaac is the president and principal consultant for MacIsaac Consulting. Mike provides leadership as an IT Project and Program Manager as well as an Agile Scrum Master. Follow Mike on Twitter @MikeMacIsaac or subscribe to Mike’s blog.
Deming, E. (1982). Out Of The Crisis. Cambridge, MA: MIT.
Mankins, M & Garton, E (2017). How Spotify Balances Employee Autonomy And Accountability. https://hbr.org/2017/02/how-spotify-balances-employee-autonomy-and-accountability
Poppendieck, M. (2003). Lean Software Development. Upper Saddle River, NJ: Pearson Education.
Schwaber, K. (2004). Agile Project Management With Scrum. Redmond, WA: Microsoft Press.