How to Build & Manage High-Performing Cross-Functional Team

Picture a team where diverse perspectives, skills, and experiences seamlessly come together. Imagine the incredible results they could achieve. This is the power of cross-functional teams.

They harness the collective wisdom and expertise of individuals from various backgrounds. This collaborative approach fosters innovation and drives extraordinary outcomes.

The need and demand for cross-functionality is soaring. In a recent survey, 56% of respondents actively encourage greater cross-functional team collaboration. But building a successful cross-functional team is no easy task. It requires careful planning, effective communication, and strong leadership.

This article explores the key strategies for creating and managing high-performing cross-functional teams. From understanding the benefits to overcoming common challenges, we’ll provide actionable insights to help you achieve success.

What Is a Cross-Functional Team?

A cross-functional team is a group of individuals from different departments or areas of expertise working together toward a common goal.

Rather than being siloed within their own departments, team members pool their knowledge and skills, offering unique perspectives that drive innovation, streamline processes, and solve complex problems.

Examples of Cross-Functional Teams in Action

So, what does a cross-functional team look like in action? Here are some example scenarios from various industries:

What Are the Benefits of Cross-Functional Teams?

Here’s how working cross-functionally can benefit your team.

Employee skills development

Working with people with different experiences and qualifications boosts workers’ skill arsenal. In turn, consistent learning and development increases employee retention by 34% and productivity by 52%.

Say a user experience (UX) researcher collaborates with a copywriter. The former picks up tips on persuasive copy, while the latter better understands audience data patterns. Both upskill and improve their performance in their respective roles.

In addition, cross-functional team members enhance their:

• Lateral thinking: Analyzing old problems with new, unexpected tools (e.g. using design thinking to improve a sales process).

• Problem-solving: Finding patterns, root causes, and effective solutions with extra moving parts.

• Communication: Relying on argumentation, empathy, and negotiation to find common ground.

A more differentiated service

Cross-functional teams deliver more thorough and innovative client results. In turn, your business increases its differentiation among competitors.

Imagine a project management and a customer support team working independently on the same client account. Without shared data and problem-solving, they risk providing customers with out-of-date or contradictory information.

Conversely, a cross-functional team of project managers and support reps provide faster, higher-quality service. Plus, it helps develop better products over time thanks to complementary skill sets (e.g., big-picture thinking + detail orientation), boosting customer satisfaction and retention.

Fewer errors and inefficiencies

Cross-functional teams leave less room for error and inefficiency. First, your workers don’t complete tasks in communication silos, fixing potential problems before they appear.

A technical product manager, for example, might inform a marketing colleague that their campaign should highlight benefit X, not Y.

In addition, more types of thinking (e.g., technical, financial, strategic, and creative) generate better decisions, such as those reducing operational risk and under-productivity.

What Are the Challenges of Cross-Functional Teams?

However, cross-functional teams are not without their challenges. There is a natural tendency to segment teams based on skills, roles, and functionality. So harmonizing employees with different goals and skills presents several issues. These include:

Communication Barriers:

One of the most significant challenges facing cross-functional teams is effective communication. Misunderstandings, differing communication styles, and specialized jargon can hinder collaboration and productivity. To overcome these barriers, it’s essential to:

• Establish clear communication channels: Use tools like Spike to create dedicated channels for team discussions, file sharing, and project updates.

• Promote active listening: Encourage team members to actively listen to each other and avoid making assumptions.

• Use clear and concise language: Avoid using jargon or technical terms that may not be understood by everyone on the team.

Conflicting Priorities:

Another common challenge in cross-functional teams is managing conflicting priorities. When team members have different goals or objectives, it can be difficult to align efforts and make progress. To address this issue:

• Set clear team goals: Establish a shared vision and mission for the team, ensuring that everyone is working towards the same objectives.

• Prioritize tasks effectively: Use tools like Spike to prioritize tasks based on their importance and urgency.

• Encourage open communication: Create a safe and supportive environment where team members can openly discuss their priorities and concerns.

Leadership Issues:

Effective leadership is essential for the success of cross-functional teams. Leaders must be able to facilitate collaboration, manage conflict, and ensure that team members are aligned with the team’s goals. To overcome leadership challenges:

• Provide training and development: Offer leadership training programs to equip team leaders with the necessary skills to manage cross-functional teams.

• Encourage collaboration: Foster a culture of collaboration and teamwork by creating opportunities for team members to interact and build relationships.

• Use tools like Spike: Leverage tools like Spike to streamline communication, manage tasks, and facilitate collaboration.

Resource Allocation:

Allocating resources effectively is another crucial challenge for cross-functional teams. Ensuring that team members have the necessary tools, support, and time to accomplish their tasks is essential for success. To address resource allocation challenges:

• Create a resource allocation plan: Develop a clear plan outlining the resources required for the team to achieve its goals.

• Monitor resource usage: Track resource usage and identify any bottlenecks or inefficiencies.

• Prioritize resource allocation: Allocate resources based on the team’s priorities and the importance of specific tasks.

By effectively addressing resource allocation challenges, organizations can ensure that cross-functional teams have the support they need to succeed.

4 Types of Cross-Functional Teams

Cross-functional teams come in different shapes and sizes, depending on timelines, locations, and seniority levels. Here are 4 main types to consider.

1. Permanent cross-functional teams

A permanent team chases long-term organizational goals and continues to exist even when founding members retire or change roles. This allows you to build comprehensive products or processes, gain market share over time, and keep your business competitive in the face of new trends.

For example, Google teams including product development and marketing operate cross-functionally permanently.

2. Temporary cross-functional teams

In contrast to permanent teams, temporary ones engage cross-functional professionals to solve specific, short-term challenges.

Here are some scenarios where you may build a temporary cross-functional team.

• A long-term client approves an experimental project requiring in-depth research and development (R&D).

• A product, service, or internal department (like IT or recruitment) requires time-sensitive improvements.

• You’re running an internal trial to test a certain hypothesis — for instance, whether a new market would buy your product.

3. Leadership cross-functional teams

Executive cross-functional teams combine expertise in business areas like finance and innovation, or markets such as geographic regions and B2B verticals.

These teams solve mission-critical problems, usually working on several projects or goals (say, a market entry and an internal restructuring). However, effective leadership teams gather data and feedback from all business areas, including front-line employees.

4. Virtual cross-functional teams

Virtual teams can overlap with permanent, temporary, or leadership ones. They have extra challenges and benefits, however, since their team members work across geographic areas.

For example, virtual collaboration allows you to recruit nationally and globally, getting the best talent in your cross-functional team while enriching members’ work-life balance. They also require razor-sharp processes, digital tools, and coordination to stay productive.

Learn with Spike: Whether permanent, temporary, virtual, or leadership, your cross-functional employees can work:

• Full-time: All their responsibilities are in the cross-functional team.

• Part-time: They work both on cross-functional tasks and departmental ones (e.g., marketing, legal, product-specific).

7 Steps to Build a Successful Cross-Functional Team

Here’s Spike’s step-by-step guide to building a goal-smashing cross-functional team.

1. Assess your need for a cross-functional team

First, ask yourself if your project requires cross-functional collaboration. If it doesn’t, you may get more headaches than results. Here’s what to consider:

2. Design the team structure

Your team structure outlines individual roles and responsibilities, plus hierarchy and collaboration relationships. Design this structure effectively before recruiting members to avoid confusion, lack of productivity, and low-quality results.

Here are two key ways to structure your cross-functional team.

Expertise-based

Example:

Split a cross-functional internal audit team into expertise-based working groups such as risk analysts, certified accountants, compliance specialists, and data analysts.

This structure may resemble a traditional functional setup, but the working groups collaborate regularly and share a common goal. You might apply this structure for complex, long-term projects.

Task-based

Example:

Group researchers, product managers, and engineers in a website development project based on website sections (e.g., clothing collection vs. checkout page).

In a task-based structure, specialists form working groups on a task-by-task basis. This is especially productive in time-sensitive or high-stakes tasks requiring multiple viewpoints.

Pro tip: Don’t be rigid. You can switch between team structure types according to project stages and use different team structures across your business.

3. Pick your cross-functional team members

You can recruit cross-functional staff either internally or externally. Internal talent could suit projects requiring fine-tuned product or market knowledge.

Meanwhile, you might hire new employees (or contractors) if you need fresh perspectives on complex challenges.

While you need to draft job specifications and requirements for each team member role, here are some traits and skills to test across the board:

• An understanding of other areas’ aims and processes. For example, a legal expert working with an HR manager must understand the latter’s non-legal responsibilities, such as helping employees feel valued and supported.

• Excellent communication. Workers should present ideas clearly and concisely, use empathy and listening skills, and give and receive open feedback.

• Experience working cross-functionally. They should feel comfortable following collaborative workflows, sharing relevant information, and delegating tasks based on skills and expertise.

• Growth mindset. Cross-functional coworkers inevitably challenge and teach one another. A growth mindset lets them absorb new skills rather than become defensive when challenged.

4. Clarify team goals and expectations

Sending your team into the wilderness with no compass jeopardizes your results.

So, start by setting SMART goals. Afterward, let your team experiment with how they can best achieve them.

Your SMART goals should be:

• Specific (e.g., “launch in Indonesia,” not “launch in a new market”)

• Measurable: (e.g., “achieve 10% market share,” not “increase market share”)

• Attainable: (e.g., “retain 50% of existing clients,” not “retain 100% of existing clients”)

• Relevant: (e.g., for an operational project, “increase productivity,” not “increase sales”)

• Time-bound: (e.g., “deliver within 12 months,” not “depending on management approval”)

On top of goals, communicate the following expectations with your entire team:

• Budget: Include, for instance, the number of budgeted days (individual and/or team), and caps on supplies such as rent or software.

• Timeline: Outline (ideally, in shared documents) start and end dates, plus dependencies, for each project stage.

• Milestones: Point out key events such as completing a stage or getting client feedback.

• Line of communication: Clarify which team members or supervisors to speak to, and when, depending on the topic.

5. Outline collaboration workflows

Clear collaboration workflows indicate the processes and tools your team should use to complete collective tasks. This overview is doubly important for cross-functional collaborators who don’t have complete insight into one another’s tasks.

Example collaboration workflow for a short-term project:

• Expertise-based sub-groups work on [Stages X, Y, and Z] before [Milestones A, B, and C]. Colleagues collaborate on chat, email, project management software, and [Other task-specific software], plus face-to-face in the office.

• The entire team meets weekly for virtual updates, feedback, and brainstorming for 1 hour. Expertise sub-groups execute resulting action points.

• In the final project stages, the team reorganizes into task-based sub-groups for detailed interdisciplinary work. They meet more often for longer online or face-to-face meetings.

Bonus tips — here’s how to manage meetings and tasks and in cross-functional teams.

Tasks

• Set tasks based on individual expertise, but allow members to reallocate flexibly depending on workloads.

• Occasionally, delegate tasks to less experienced employees needing development opportunities, but provide mentorship and hands-on support.Provide clear task descriptions

• (e.g., quality standards, numerical targets), but allow subject-matter experts to question or add to the brief.

Meetings

• Request agenda inputs from all corners of your cross-functional team.

• Get ideas and feedback from different subject-matter areas, especially from the quieter people in the room (accountants, we’re looking at you.)

• Politely interrupt high-level updates that go into too much specialist detail. Record the issue in the meeting minutes and task the relevant team with “taking it offline”.

Pro tip: Keep a watchful eye on micromanagement (which lowers productivity and creativity.) Look out for symptoms such as employee disengagement or defensiveness, take a step back, and focus on hands-off mentoring and performance tracking instead.

6. Adopt communication best practices

Equip your team with research-backed communication practices to allow their cross-expertise talents to shine.

Here’s a handful of highly effective communication practices to apply.

• Psychological safety: Remove both logistical and emotional barriers to workers’ risk-taking and self-expression. For example, ask, “What did you learn from this?” rather than “What went wrong?” when the team misses a target.

• Feedback loops: Facilitate open, constructive feedback between project peers, including brief regular encouragements (e.g., “I liked your last presentation!”) and expertise-based viewpoints (e.g., “Here’s another way to look at the problem. [Insert expert point.]”)

• Devil’s advocate: Adopting a debate-friendly devil’s advocate stance makes opposing arguments less personal and more focused on reaching effective solutions.

• Conflict resolution: Dissolve tension between different personality and experience types by finding the root cause of arguments, swiftly fulfilling individual needs using compromise, and staying sensitive to cultural or demographic differences.

7. Offer cross-functional leadership training

On top of traditional leadership responsibilities like hitting project goals and supporting team members, cross-functional team managers must act as “translators”.

That means they understand the terminology, tools, and practices across team specializations — which enables them to foster teamwork and avoid miscommunication.

Don’t worry, there’s no need to list a new “Cross-functional team leader” job on LinkedIn. You can train your existing team leaders in:

• Setting accountability: Letting team members own project components — say, email copywriting in a marketing campaign — increases performance and engagement. Plus, it encourages task delegation from owners to subject-matter experts.

• Team recognition: Celebrating individual and collective achievements consistently and fairly helps cross-functional colleagues feel more connected to their common goal. For example, point out milestones and tag a high-performing team member on your chat app.

• Big-picture perspective: Translate cross-expertise needs and results using top-down storytelling. For example, use the pyramid principle to spotlight the conclusion (or summary), followed by several levels of supporting details.

Pro tip: Win over a “team ambassador” in your company who can advocate on behalf of your cross-functional team to senior management.

They may, for example, book a meeting in the right calendar more quickly, or influence decisions on funding and staffing.

How to Manage Hybrid Cross-Functional Teams

Eight in 10 workers work in hybrid settings in the U.S., so your cross-functional teams need to adapt to their unique requirements.

Here are Spike’s two practical tips to achieve this:

1. Make individual adjustments

Hybrid and remote worker needs vary based on individual circumstances. For example, some may need scheduling adjustments to manage childcare or disabilities.

In cross-functional teams, you’ll likely have a great diversity of personalities, life circumstances, and resourcing needs.

So, collect and fulfill your team members’ hybrid adjustments — using 1-to-1 line manager chats or online forms, for instance. List available adjustments, from schedule flexibility to technical equipment and training, and stay open to new suggestions.

2. Offer flexible digital tools

Digital tools keep your hybrid cross-functional team productive and cohesive.

Ensure your collaboration tools include basic features like group and 1-to-1 chat, audio/video calls, and task management. Depending on your team’s composition and goals, you may also need specialized tools such as those supporting project management, software development, document editing, and design.

You should be able to easily integrate multiple platforms to save time and increase data accuracy. Plus, provide detailed but concise guidelines on how and when coworkers should use these resources.

Best Tools to Manage Cross-Functional Teams

Different types of collaboration tools can power your cross-functional team — hybrid or otherwise.

Here, we spotlight three main platform categories.

End-to-end collaboration platforms

Spike is a leading example of an end-to-end collaboration app that bridges communication, task management, and document collaboration.

In a nutshell, your cross-functional team can:

• Use email and chat in one conversational inbox, focusing on people, not threads.

• Create project-based chats, and use multimedia such as messages, voice notes, files, and images to tackle problems.

• Create and track team tasks, and use shared notes to take minutes, record actions, and more.

• Use Spike’s Magic AI bot to generate ideas, from ready-to-send email drafts to plans and lists.

• Co-work in real-time on versatile documents that include text, images, videos, attachments, code, and checklists.

• Schedule and hold team video calls on a secure and reliable platform where you can screen share and invite non-Spike participants.

Communication platforms

Communication tools such as Slack or Microsoft Teams allow cross-functional teams to build relationships, get quick updates, and work on project challenges in real time.

Many include 1-to-1 chat, private groups, audio/video calls, file sharing, and integration with third-party software such as cloud storage, email, and calendars.

Project management platforms

Finally, project management platforms offer a single version of the truth for the timelines, tasks, people, and statuses that make or break project success. It’s where your cross-functional team plans and manages “the work” clearly and consistently.

Here are three examples of project management software.

• Jira: Detailed tracking and automation for complex projects that can include dependencies, goal tracking, and technical releases.

• Asana: Visual-first tracking and reporting on project streams, task status, and goals for wider cross-departmental tracking.

• Trello: Board-based organizing of shared information, steps, and tasks, especially suited for individual workflow management.

Wrap-Up on Building Cross-Functional Teams

A cross-functional team helps you solve multi-faceted business problems, from complex internal restructuring to new product launches.

They help upskill your staff and increase customer satisfaction, but face risks such as becoming under-prioritized by traditional departments and specialists getting “lost in translation”.

That said, best practices including designing a team structure, pinning down SMART goals, plus offering communication guidelines and leadership training, set your cross-functional team up for success.

Include feature-rich collaborative tools in your team workflow for an extra productivity kick. Spike is an end-to-end collaboration app that connects your interdisciplinary team across email, chat, tasks, documents, meetings, and more.