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Managing Innovation by Cross-Functional Teams Discovering Winning Systemic and Synergistic Solutions |
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By: Vadim Kotelnikov
Founder, Ten3 Business e-Coach – Inspiration and Innovation Unlimited!
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"I see true innovation to be made up of three 'creativities' – creativity in technology, product planning, and marketing." – Akio Morita |
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Why Cross-Functional Teams? When ideas meet and information comes together, you bring innovations to market smarter and faster. A diversity of ideas and opinions are needed to generate high quality solutions. Innovation, the source of sustainable competitive advantage for most companies, depends upon the individual and collective expertise of employees. In the new era of systemic innovation, it is more important for an organization to be cross-functionally excellent than functionally excellent. In addition to formal planning at the business level, best-practice companies use crosscutting initiatives on major issues in order to challenge assumptions and open up the organization to new thinking. Firms which are successful in realizing the full returns from their technologies and innovations are able to match their technological developments with complementary expertise in other areas of their business, such as manufacturing, distribution, human resources, marketing, and customer relationships. To lead these expertise development efforts, cross-functional teams, either formal or informal, need to be formed. These teams can also find new businesses in white spaces between existing business units. Interplay among individuals is essential to the innovation process. While individual creativity is important, and even crucial to business, the creativity of groups is equally important. The creation of today's complex systems of products and services requires the merging of knowledge from diverse disciplinary and personal perspectives. Innovation – whether it be revealed in new products and services, new processes, or new business models – is rarely an individual undertaking. Creative cooperation and cross-pollination of ideas is critical. In cross-functional teams, individuals from different backgrounds draw upon their pools of tacit, as well as explicit knowledge, to contribute. The tacit dimensions of their knowledge bases make such individuals especially valuable contributors to innovation projects; perspectives based on such knowledge cannot be obtained any other way except through interaction.1 Just hearing a very different perspective challenges the mindset of others sufficiently that they will search beyond what initially appears to be an obvious solution. This is a reason that intellectually heterogeneous cross-functional teams are more innovative than homogenous functional ones. How To Break Down Barriers To Communication
Synergy in business is the benefit derived from combining two or more elements (or businesses) so that the performance of the combination is higher than that of the sum of the individual elements (or businesses).
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Cultural Intelligence – Leveraging Cultural Diversity One advantage of cultural diversity is the potential for innovation arising from the presence of multiple perspectives. Yet, it is clear that not all multicultural teams/organizations are able to harness this benefit. Cultural intelligence (CQ) may enhance the likelihood of innovation success in culturally diverse teams/organizations. CQ facilitates the reconciliation of differences and conflicts, and enhances the probability of arriving at culturally synergistic solution that embraces the ideas or interests of various parties. Case in Point Harley-Davidson... Harley-Davidson, Inc. designs, manufactures, and markets heavy-weight motorcycles, motorcycle parts and accessories, and motorcycle collectibles and riding apparel. Management at Harley-Davidson has been recognized worldwide for its successful use of progressive, cutting-edge management techniques.5 One specific area in which Harley-Davidson's management has received acclaim is its use of cross-functional teams to design new products. To some extent, cross-functional advice has always been considered within the new product design process at Harley-Davidson. Representatives from engineering, purchasing, manufacturing, and marketing have always had some influence on the future direction of new products. Management of the company has underscored its commitment to cross-functional teams for designing new products by opening a new Product Development Center (PDC) near its plant in Wauwatosa, Wisconsin. For years the motorcycle maker has been consistently moving toward more emphasis on using cross-functional teams for new product development. The PDC accelerated this move by locating design engineers, purchasers, manufacturing personnel, and other crucial players in a single building. These team members work together daily and are totally dedicated to the new product development process on a full-time basis. Case in Point Corning Corning, a Fortune 50 company, has a long heritage of inventing new technologies and creating new businesses. At Corning, cross-functional teams are involved at every stage of the innovation process and have access to every resource and technology that is needed for project success. These teams address technology, manufacturing, and marketing concerns with every new idea and experiment, and they work to keep all these functions synchronized. They determine quite early in the innovation process exactly how the technology fits with customer and market needs, as well as manufacturing constraints. This process is highly iterative.
Innovation Team: Creativity and Social Interaction... Cross-Functional Team Meetings... Five Popular Innovation Myths... Recommendations to Top Executives... Create Road-Maps... Co-innovate with Your Suppliers and Customers... Diverse Routes to Innovation... Value Innovation... The Power of Taking a Different View... Achieving Deep Customer Focus: 10 Critical Breakthroughs... Ask Searching Questions... Case in Point Silicon Valley... Case in Point IDEO... Case in Point Quantum... Case in Point DEGAP...
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