Shifting organisational paradigms

Organisations are changing and switching to an increasingly collaborative context. The development has been partly exacerbated by the growing technological and increasingly digitised nature of the workplace. The 21st century continually challenges organisations to adopt and promote new principles, attitudes, and values that embrace collaboration, de-centralised decision-making, and teamwork. This shift in mindset can be represented quite nicely by the Manifesto for 21st Century Management (Challapilla, 2015), I believe, since it resonates pretty well with all the recent collaborative statistics published in recent months:

1. Developing resonant relationships instead of perpetuating dissonant relationships
2. Inspiring, exciting, and motivating people instead of judging, evaluating, and assessing them
3. Inviting people toward a vision instead of focusing on their task completion
4. Enabling self-organisation instead of exerting centralised control
5. Cultivating intrinsic motivation instead of exploiting extrinsic motivation
6. Embracing and exploiting diversity instead of seeking conformance

This transformation in values, principles, and attitudes has resulted in organisations being technically forced to advance in ways that, in some cases, aren’t fully adapted or ready for. Nevertheless, these 21st-century management principles and values have pushed modern organisations to adopt a different set of goals to cultivate a variety of technical, emotional, and professional competencies such as:

• critical thinking & problem-solving
• creativity & innovation
• communication
• collaboration
• flexibility & adaptability
• initiative & self-direction
• social & cross-cultural interaction
• productivity & accountability
• leadership & responsibility (source).

These 21st century skills reflect the targets of current organisational transformation goals, these “soft” skills are essential for the success of any organisation and are the building blocks for organisational resilience. Employee surveys reflect the same. The following 2020 trends of employee collaboration illustrate the direction of organisational development and focus:

1. 70% of employees said digital technology improved cooperation (Source: ArubaNetworks).
2. Digital collaboration statistics reveal that online collaboration tools and digital workplaces facilitate increased productivity by up to 30% (Source: McKinsey).
3. 83% of employees use technology for collaboration (Source: Alfresco).
4. Fully operational communication systems assist in holding on to top talents in companies by up to 450% (Source: Room to Escape).
5. Virtual team collaboration statistics show that remote working can save employers as much as $11,000 per year (Source: Global Workplace Analytics).
6. Happy workers can increase their productivity by up to 20% more than unhappy workers (Source: Social Market Foundation).
7. Collaboration is among the top four skills for employees’ future success (Source: Emergenetics).
8. Incredibly connected teams demonstrate a 21% increase in profitability (Source: Gallup).
9. Employees now spend about 50% more time engaged in collaborative work (Source: Harvard Business Review).
10. Roughly 75% of employees regard collaboration and teamwork as important (Source: Queens University of Charlotte).
11. Over half of employees say a strong sense of community kept them at a company longer than what was in their best interests (Source: Gusto).
12. Employees who acted collaboratively stuck at their tasks 64% longer than their solitary peers reported higher engagement, lower fatigue, and higher success rates (Source: forbes.com).
13. Knowledge workers spend an average of 14% of their workweek communicating and collaborating internally (Source: hubbion.com)
14. Workplace collaboration can increase successful innovation by 15% (Source: PGI.com)

A resonating element that can be traced along these trends is transparency: teamwork and collaboration are essential for the success of any organisation.

I’ll explore this in more detail, explicitly concerning highly effective teams.

Teams

Teams are an essential staple of any organisation and are responsible for its greatest achievements. The trend towards teams has been growing for centuries, and in the most recent decade, organisations’ preference for team development has skyrocketed. This is due, in part, to teams’ resilience, cross-functionality, and innovative capabilities.

Successful teamwork relies heavily on the synergies forged by individuals with one another to create an environment where their purpose-driven contributions, service, and ideas are not only nurtured but also promoted in a positive, constructive way. Team members prefer constructive collaboration over personal, ego-driven goals.

Different kinds of teams have long served organisations. This began with the adoption of functional teams, and some have now shifted to new organisational forms called cross-functional teams.

Functional teams

In the past, teams were treated in functional groups administered highly hierarchically. There were team leaders, line managers, project managers, and various people in middle management responsible for issuing tasks, overseeing progress, documenting results, and coordinating individual units. These teams were controlled closely by functional managers and their internal line managers to focus solely on the functions these employees were hired to do. These were functional silos. All the eggs were in the same basket, and the company thought these people would be employed forever. They were kept busy 8.5+ hours a day for the organisation’s benefit, and the members of functional teams were “compartmentalised operating units isolated from their environment” (Motiwalla & Thompson, 2009).

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The graphic above is an excellent example of what functionally-driven organisations look like. This organisational diagram on the right magnifies a much larger organisational construct. This is likely a structure found at the 3rd layer, if not the 4th, in a vast organisation. There are also medium-sized organisations that have a similar organisational hierarchy. It is called a “matrix organisational structure” because moving top-down and from left-to-left to the right is controlled and administered by a middle manager; they may be line managers, functional managers, team leaders, etc… and each has a set of employees below them. They typically have the role title “Head of _______”. Information is delivered top-down, and the lower you are in the hierarchy, the harder it is to be heard.

Decoding the functional setup

What’s most interesting is a familiar position I once held in such matrix organisations, the project manager. There was a line manager for project managers; there are always line managers in matrix organisations. We were administered as functional teams led by the line manager. Line managers were given targets and goals by their line managers, and the pressure on the employees decreased. Employees are busy fulfilling the objectives of the functional manager; since they were hired for this purpose, they were treated as functional silos. Each employee was already tasked by their functional manager to do the jobs they were hired to do, and that became the only thing these employees cared about until the project manager came.

The project manager has a pseudo project, which is very important for the executive manager and their line manager (project management office, PMO). The PMO instructs the project managers that they need to finish projects A, B, C, D, and E, and the PMO assigns these projects to the available project managers. The project manager works up a waterfall procedure whereby certain activities will be done at a particular time and produces considerable upfront planning to organise the activities of employees in each corresponding functional hierarchy. The project manager deduces that to complete Project A, the project manager must seek the support of Employees A, Z, F, G and P, and these employees may be dispersed among different functional managers. Yet employees A, Z, F, G and P are working 100% already for Functional Managers A, Z, F, G and P. How will the project manager complete Project A? The project manager must coordinate with Functional Managers A, Z, F, G and P to determine what resources could be had from the respective employees needed for Project A. There will be negotiations and favours, and suddenly, employees A, Z, F, G, and P will be reassigned to work on Project A while working 100% on the work for their functional managers. Some will argue that the employee capacity is adjusted to suit the needs of Project A, but the reality is that this is not valid. I have experienced this myself.

Suddenly, employees A, Z, F, G, and P are “working together,” but they don’t know what the other is doing, only that the Project Manager wants each to fulfil a specific task. The fatigued employees must serve their respective functional managers with their agendas and needs. No one knows the actual status of Project A; there are delays because employees A, Z, F, G, and P are too busy to do anything for Project A.

I challenge you to go to an employee and ask them if they could lend you 2 hours in the week to do what you desperately need to be done. Do you know what they’ll tell you? Speak with my functional manager or “the boss”. The boss asks you why you need this employee, clearly this employee has much more important things to do. Functional manager B doesn’t see that Project A has any value for the company; only the company sees that, and maybe the project manager does, too.

I’ll tell you what will happen, you won’t get 5 minutes from this employee.

Surprise, surprise, nothing ever gets done in this kind of environment.

Functional teams were designed to fulfil a specific purpose. This compartmentalisation was better for the company because line management could easily administer these functional silos–all they had to care about was their functional responsibilities, and functional silos were easily monitored. Functional silosnever needed to care about the business itself or what other functional silos were working on. Time and time again, functional silos inevitably develop an unhealthy inward focus.

Cost of functional silos

Functional silos compete with one another for the share of the budget; often, functional silos are driven by their agendas in pursuit of their objectives that may or may not be linked to the corporate agenda. This unhealthy competition makes it difficult to see the value other functional silos are delivering. This inward focus develops highly specialised talent that is driven by sustaining itself. Often the people in these functional silos become knowledge silos. These know-how silos make it increasingly difficult for organisations to achieve their flexibility and speed. These know-how silos often take the organisation “hostage”; these people stay in the organisation for years and refuse to disperse their knowledge and adapt to new ways of working. The organisation can’t do anything about it. This is precisely what has happened with ZHAW (Zurich Hochschule für Angewandte Wissenschaft) for the past 15 years.

Weihrich & Koontz (2005) provide a considerable review of the disadvantages of the functional organisation:

• De-emphasises overall company objectives;
• Overspecialises and narrows viewpoints of key personnel;
• Reduces coordination between functions;
• Responsibility for profits is at the top only;
• Slow adaptation to changes in the environment; and
• Limits development of general managers.

The hierarchical nature of the organisation makes it difficult to identify responsibility and accountability because those are typically delegated to the “boss.” The “boss” makes all the decisions, and functional teams are expected to follow them. Bureaucratic bottlenecks complicate information delivery, priority assignments, priority ranking, accountability, role definitions, and coordination.

The antithesis of functional teams? Cross-functional teams.

Cross-functional teams

Cross-functional teams have emerged as a remedy to the previously dysfunctional constructs most commonly associated with functional teams. Cross-functional teams contain members of various divisions/departments who work together in a concerted effort to synthesise a product or service for use by a customer. There are several reasons why many organisations with dependent processes prefer this. In doing so, they:

1. Reduction in handoff: people take less time passing work over to one another, and they don’t have to go so far
2. Reduction in silos: team members work together and exchange knowledge regularly, thereby reducing silos. Team members develop many skills and are aware of the entire development of that product/service.
3. A unified process: team members work together in a simplified process that best enables them to deliver the product/service
4. A common understanding: Team members talk to one another regularly and share a common understanding of their objectives and how they will achieve them.
5. Reduction in lead time: Thanks to their agile methodology, cross-functional teams are able to synthesise the best of their collaboration to deliver sooner to their customers, thereby focusing strongly on lead time (as shown in the graphic below).

Not all cross-functional teams fulfil this promise. They need to be sufficiently embedded in a system that nurtures them. Many of these cross-functional teams are managed inefficiently and ineffectively, producing considerable waste and damage to the company’s internal ways. Functional teams that were in the past are presently thrown into a group with others who they never met and whose work they don’t understand and are expected to collaborate miraculously.

Dysfunctional cross-functional teams

At the ZHAW (Zürcher Hochschule für Angewandte Wissenschaften) in the IT department, I had the displeasure of working with a team that had a member who consistently complained, daily in fact, that they had to listen to the work of his colleagues who he had no interest in hearing. This functional silo of 10 years complained because he was thrown into a team he didn’t want to be in, and scrum masters have been quickly hired to try to “fix” things in that dysfunctional team. They were, in effect, forced to work together. That team never had true collaboration, and there never will be. This is a hard truth to admit, but the “cross-functional” team will inevitably draw blood in an already dysfunctional organisation.

At the ZHAW, ten teams were constructed this way, and very few talented agilists were available to resolve internal disputes, competing agendas, and alignment problems throughout the entire information supply chain. They adopted a flawed scaled agile framework called SAFe, considered one of the most heavy non-agile frameworks. With no experience in SAFe and poor outside intervention, ZHAW was destined to fail and is on the fast track to organisational failure. There is considerable evidence that forcing collaboration will only reduce morale, amplify divisiveness, and increase cynicism of the organisation’s leadership and between participants of the system.

Characteristics of functional cross-functional teams

Tarricone & Luca (2002) provided an extensive literature review as far back as 1970 to distil the common attributes of effective teams. In doing so, Tarricone & Luca (2002) collected the following qualities essential to effective teams:

1. Commitment to team success and shared goals
2. Interdependence
3. Interpersonal Skills
4. Open Communication and positive feedback
5. Appropriate team composition
6. Commitment to team processes, leadership & accountability

Tarricone & Luca (2002) prepared a marvellous table in their foundational article; what they have uncovered is surprising. Let’s look at the details published here directly from their epic study.