Managing Cross-Functional Teams: The Hard Truth About Collaboration

Read Time: 4 minutes.

There are few things more polarizing than cross-functional teams.

They're sold as the silver bullet for innovation, collaboration and efficiency.

In reality?

They're often a bureaucratic nightmare that leaves everyone pointing fingers.

I've seen it. I've lived it.

And I've cleaned it up the mess more times than I care to count.

But here's the kicker:

We’re always working in cross-functional teams.

At small scale, everyone is fluidly wearing so many hats we wouldn’t even call them that.

But as we grow…

• Functions scale

• Power concentrates

• Management is needed

And we formalize cross-functional teams to push back against those forces.

Except most companies get it wrong and end up with a bigger mess than the one they set out to fix.

So, let's dive into the ugly truth about cross-functional teams and how to actually make them work.

The Cross-Functional Conundrum

Here's what typically happens:

1. The Power Trip: These teams get too much authority without the capability to back it up. They become the new bureaucrats, obsessed with control and preventing risks rather than driving results.

2. The Scapegoat: Or worse, they're set up to fail from the start. Understaffed, under-resourced, and then blamed when other teams miss their targets. "We couldn't hit our goals because recruiting couldn't get us the people we needed." Sound familiar?

Neither scenario works. Both lead to frustration, finger-pointing, and a whole lot of wasted time and money.

The Elon Approach

Elon Musk, Jeff Bezos and Ray Dalio (love them or hate them) have a different take.

They prefers small, autonomous teams.

Why?

Because they move faster, communicate better, and have no one to hide behind.

But how do you handle cross-functional needs in this model?

1. Embed, Don't Separate: Instead of creating a separate cross-functional team, embed specialists directly into the teams that need them.

2. Rotate and Learn: Encourage team members to rotate through different functions. This builds empathy and understanding across disciplines.

3. Clear Ownership: Every project or product has one clear owner. No committees. No consensus-building. No dotted lines. Just clear accountability.

Making Cross-Functional Teams Work

If you're stuck with cross-functional teams (and let's face it, most of us are), here's how to make them actually work:

Set a High Bar

The benchmark is simple: Would the teams you're supporting willingly pay for your services and choose you over outside vendors?

If the answer is no, you've got work to do

Clarify the Mission

Are you there to:

• Drive innovation?

• Streamline processes?

• Solve specific problems?

Pick one. Communicate it clearly. And stick to it.

Match Authority with Capability

Don't give cross-functional teams power without the skills to use it wisely. Invest in training, bring in outside expertise if needed, and be willing to restructure if things aren't working.

Create Real Accountability

Set clear, measurable goals. And here's the kicker: tie the cross-functional team's success directly to the success of the teams they support. No more hiding behind process metrics.

Foster a Service Mindset

The best cross-functional teams see themselves as service providers, not gatekeepers. They're there to enable, not control.

Communicate Relentlessly

Silos are built on assumptions and misunderstandings. Break them down with over-communication. Daily stand-ups, weekly demos, whatever it takes.

Embrace Conflict

Healthy disagreement is good. It means people care. Create a culture where respectful challenges are encouraged, not suppressed.

Stay Lean

The bigger the team, the slower it moves. Keep cross-functional teams as small as possible. If you can't fit everyone in a single room (or Zoom call), it's too big.

The Bottom Line:

Cross-functional teams aren't inherently good or bad.

They're tools.

And like any tool, their effectiveness depends on how you use them.

Done right, they can break down silos, speed up decision-making, and drive innovation.

Done wrong, they become just another layer of bureaucracy.

The choice is yours.

But remember:
The goal isn't to have great cross-functional teams.
The goal is to build a great company.

Don’t fall in love with a design that doesn’t serve you.

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Thank you for reading. Appreciate you!

Dave & Mar

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