Cross-functional teams are teams made up from representatives of multiple organization functions typically intended to achieve required

CHAPTER 4: Organizational Redesign

C. Cross-functional teams are teams made up from representatives of multiple organization functions typically intended to achieve required

coordination along a chain of inter-related activities and processes.

Theory into Practice: Use cross-functional teams to help create seamless, well-integrated processes.

D. Different team types (exhibit 4-6, page 98)

1. Work team—by sharing responsibilities, developing multiple skills, and performing varied tasks, motivation and quality are enhanced.

2. Product development team—through concurrent rather than sequential development activities, speed-to-market and innovation are enhanced while costs associated with rework are diminished.

3. Problem-solving team—by bringing together individuals from multiple functions, problems associated with hand-offs and cross-functional interactions can be creatively addressed.

4. Project management team—the multiple functions and tasks of the value chain are linked in order to enhance quality and customer responsiveness.

E. Creating Effective Teamwork.

1. Effective teamwork derives from four design factors (exhibit 4-7, page 99):

a. Shared purpose—effective teamwork starts with the need to create a central purpose focused on company-wide goals and equally accepted by all members.

Copyright © 2010 Pearson Education, Inc. publishing as Prentice Hall 45 b. Shared responsibility—on effective teams, members evolve beyond seeing themselves as individuals with narrowly defined and measured outcomes. Instead, they take full responsibility for and joint ownership over every aspect, every contribution, every input and every outcome of the team’s task.

c. Team empowerment—unless affirmative actions are taken to equalize power, the functional organization will likely overwhelm.

d. Team enablement—providing team members with the required skills and resources.

Theory into Practice:

• Don’t just place employees on teams and expect the performance benefits of teamwork; organizations need to create the context required for teamwork.

• When members of a team feel equally responsible for the outcome of their efforts, teamwork is enhanced.

• At least in the early stages of change, organizations need to make sure teams are buffered from traditional hierarchical power and are allowed to work across functions.

• In order to encourage teamwork, organizations can take care to ensure that team members have the appropriate skills to perform the task effectively.

• Creating effective teamwork requires providing a group of individuals with shared purpose and responsibility,

empowering those individuals to make shared decisions, and making sure they have the competencies and resources required to be effective as a team.

V. Conclusion

A. Formal and informal design elements are different.

B. Effective change implementation addresses informal design matters at the early stages and formal design elements later in the process.

Theory into Practice: organizational design involves both formal and informal elements; effective implementation targets informal design elements first, and then addresses more formal elements like structure and systems later in the process.

• Allan Afuah, Business Models: A Strategic Management Approach (Boston: McGraw-Hill Irwin, 2004).

• Michael Goold and Andrew Campbell, “Do You Have a Well-Designed Organization?” Harvard Business Review (March 2002).

• J. Richard Hackman and Greg R. Oldham, Work Redesign (Reading, MA:

Addison-Wesley, 1980).

• Robert Kanigel, The One Best Way: Frederick Winslow Taylor and the Enigma of Efficiency (New York: Viking, 1997).

• Paul R. Lawrence and Jay W. Lorsch, Organization and Environment:

Managing Differentiation and Integration (Boston: Harvard Graduate School of Business Administration Division of Research, 1967).

• Danny Miller, The Icarus Paradox: How Exceptional Companies Bring About Their Own Downfall (New York: Harper Business, 1990).

• Susan Albers Mohrman, Susan G. Cohen, and Allan M. Mohrman, Jr., Designing Team-Based Organizations: New Forms for Knowledge Work (San Francisco: Jossey-Bass, 1995).

• David A. Nadler and Michael L. Tushman with Mark B. Nadler, Competing By Design: The Power of Organizational Architecture (New York: Oxford University Press, 1997).

• Bert Spector, Taking Charge and Letting Go: A Breakthrough Strategy for Creating and Managing the Horizontal Company (New York: Free Press, 1995).

• Richard E. Walton, “From Control to Commitment in the Workplace,”

Harvard Business Review (March-April 1985).

Chapter Discussion Questions

1. Why do organizations find it so difficult to address the requirements of differentiation and integration simultaneously?

Differentiation and integration work at cross-purposes and seem to be contradictory. Differentiation emphasizes autonomy and

independence, while integration emphasizes collaboration and interdependence. To do both simultaneously is quite difficult.

autonomy within divisions of multidivisional organizations? What are some effective means of coordinating efforts among divisions?

Autonomous divisions have the ability to be highly responsive to their customers and their competitive environments. In addition, autonomy allows faster decision making at the divisional level.

Disadvantages are that divisions may end up working against each other and undermining the efficiencies of the entire corporation.

The chapter lists a number of coordinating mechanisms:

• Planning and budget systems

• Regular meetings among corporate and divisional executives

• Task forces and various teams

• Measurement and reward systems for divisional executives tied to corporate performance

• Common purpose, values, goals and strategy

3. Why is it so difficult to achieve high levels of employee commitment within today’s business organizations? List the factors that are working against commitment and the potential benefits to be achieved through high commitment.

A competitive environment where advantage depends on rapid, coordinated response will rely far more on high levels of employee commitment than it will on hierarchy and top-down control. But today’s managers must seek to build such commitment in an environment which has replaced loyalty and seniority with free agency, frequent turnover, and employment insecurity. The increasing importance of financial analysts and investors puts greater pressure on short-term results which can lead organizations to sacrifice long-term effectiveness. Those contextual changes do not make commitment any less vital; they do make the

achievement of commitment more challenging.

4. Some people have argued that there is far too much emphasis on

“teamwork” in today’s business world and that the danger is that individual creativity and initiative is being sacrificed. Do you agree or disagree?

Explain.

There is plenty of evidence that creativity is generated not just by individuals but also by working in collaboration with others. Plus, organizations are not simply seeking creativity; they need to bring

commercialization of creativity (what can be labeled organizational innovation) requires collaborative effort.

On the other hand, it would be fair to say that many organizations overuse teams. Plus, if team members are not given the

appropriate skills, their teams can fail to unleash the creativity of individuals. Finally, forces like conformity, social loafing and groupthink can work against creativity.

5. The chapter argues that change efforts should address informal design before addressing formal design. Do you agree with that theory? Explain your thinking.

The chapter makes the argument that informal design change allows for experimentation and learning. Formal design change cements new responsibilities and can lead to resistance and the requirement to redraw the lines again.

On the other side, it might be argued that employees need to have a degree of certainty about structures and systems. You are going to have to change them eventually; why not attack the issue right upfront?

Case Discussion – Performance Plus Introducing the Case

Maine Papers (MP), a century-old developer and manufacturer of specialty papers, has been engaged in strategic renewal. As part of this effort, it intends to double the percentage of revenue generated by new products. The case focuses on the Book Publishing Division, managed by Steve Cook. The BPD is

subdivided into 3 units: trade books, textbooks and auxiliary materials. Cook believes that the publishing industry has changed drastically, blurring the traditional distinctions between book markets. This is why he launched

Performance Plus (PP), a full-service program to meet the needs of all markets, headed by a cross-functional PP team.

The PP team has been functioning for a year and meets once a week. Different team members bring different perspectives and concerns. At this point, the team is behind schedule and working on a May deadline. Part of the issue deals with the inclusion of a new feature – Strong Bond, a product that enhances the durability of book binding – to the products.

1. What steps should Steve Cook, as a general manager, take to ensure that the Performance Plus team delivers a high quality product on time?

When creating strategic renewal, it is important that MP and BPD consider the business process. In this case, PP seems to be designed as a way to informally redesign the organizational structure, focusing on client service – this is good.

PP creates integration between 3 differentiated functions. In light of the complexity and dynamism of the environment, this would be an appropriate change (p. 90).

Cook does need to make sure that the team meets the 4 different

effectiveness criteria (p. 99), has been properly trained, and has access to all necessary information pertaining to its project functioning.

Because the PP team is the pilot project within BDS, Cook needs to ensure that it is successful. Finally, because the old structures are still in place, Cook may want to consider if there are incentives and rewards for the PP team to work together effectively, or if members are rewarded instead for retaining their unit focus.

2. What have been the main causes of the difficulties being experienced by PP team members?

Differentiation and integration require very different kinds of approaches.

Differentiation requires autonomy and independence, while integration requires collaboration and interdependence.

The unit members seem to be retaining their differentiated perspective, each bringing with them a different view of goals, time orientation, and possibly style and formality (p. 88). In order to effectively accomplish integration, a cross-functional team is a good move. However, in addition, a strong sense of common purpose and direction, combined with a unified commitment to core values and business strategy is needed (p. 91). This does not yet seem to be in place in the team.

Shifting from mechanistic to organic controls would help here (p. 91) as well as a clarification of decision-making rights. In addition, one should ask if the team has been properly trained in team process, integration, and decision making.

that the issue be resolved?

A key question to ask here is if the team is getting the necessary performance information. For instance, not knowing if Strong Bond is important to the client or not would be a real concern. Similarly, not everyone seems to understand the questions pertaining to deadlines, production schedules and other logistics.

Assuming that the team has worked through the key issues of shared purpose, shared responsibility, enablement and empowerment, the question here would come down to information gathering, decision making and then team

commitment to the decision.

In document Spector 2e Instructors Manual (Page 44-50)