How to Develop Cross-Functional Teams for Your Company

By Indeed Editorial Team

Updated September 26, 2022 | Published November 5, 2021

Updated September 26, 2022

Published November 5, 2021

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Cross-functional teams, sometimes called multidisciplinary teams, allow a company to put multiple specialists on a project in a way that encourages collaboration. By putting aside the traditional departmental barriers many companies adhere to, teams can arrive at solutions that utilize multiple disciplines at once. While not every project needs a multidisciplinary team, the ability for these teams to innovate and adapt to challenges makes them an asset worth developing. In this article, we define cross-functional teams, discuss the benefits of this team structure, and then give a step-by-step guide to develop your own cross-functional team.

What are cross-functional teams?

A cross-functional team is one in which team members come from different functional backgrounds, often by pulling team members from different departments. An alternate option is to create departments with a more varied talent pool, which allows for building such teams within the same department.

The goal of developing a multidisciplinary team is to give the team a wider pool of specialist skills to pull from. For example, a marketing expert on an engineering team may be able to help make a product more marketable as it's being designed. They could give input on design decisions as the engineers make them, while those same engineers can tell the marketing expert what is and isn't possible. In contrast, a traditional team structure might only allow marketing-based changes to happen later, where redesigns may be more expensive.

Is it beneficial for all teams to be cross functional?

Some companies elect to adopt a cross functional philosophy for nearly all team efforts. This approach has benefits and drawbacks. The benefit of this approach is that the company's teams become highly adaptable. By creating a multidisciplinary team, people can identify problems more quickly than on a traditional team. Multidisciplinary teams might also come up with innovative solutions to problems, as skills not normally associated with a challenge can sometimes provide unexpected insights.

The drawback of making all or most teams cross functional is that their formation may take more effort to get right. It also can sometimes be difficult to predict how much of a particular specialty a project could benefit from. A traditional team structure allows for specialists to be called upon as needed, rather than a multidisciplinary team, which may require specialists to wait as certain elements of the project hold up progress. The traditional approach to teams tends to result in a more step-by-step approach to project solutions, but this is not inherently worse.

Developing a cross-functional team

There are several things to consider when forming a multidisciplinary team. In order to better encourage cohesion and active collaboration, follow these steps:

1. Determine the team's assigned project or projects

Before forming a team, consider the goals of the project or projects you intend to assign them. Also, consider the project's scope and importance. The larger the project and the more critical it is to your company, the more work you can justify in developing an optimized team. Another factor to consider is the level of resources you intend to devote to the team's projects. As you devote more resources to a project, it becomes more important to have a highly skilled team that uses those resources efficiently.

Related: What Are Team Effectiveness Models for Workplaces?

2. Identify the skills and expertise needed

This next step is one of the most important. Multidisciplinary teams may have members of many different disciplines but not all projects have equal needs. Once you have identified the projects a team is going to be assigned, consider the skills and expertise those projects might benefit from. Most projects have a set of skills and expertise they require, along with a larger set of skills and expertise that are non-essential but still beneficial.

Common specialties most projects require include:

  • IT

  • sales

  • finance

  • product development

Projects also tend to be weighted towards a particular set of skills, even if they benefit from a wider array of skills. For example, designing a car tends to require many more people in the field of product development than finance, even if both specialties are relevant.

For larger projects, it may be important to break up the project into stages to determine your team's needs. The early stages of projects typically require more developmental experts, and later stages often require more marketing and sales experts. If the project could benefit, it's possible to evolve the team composition of a multidisciplinary team as a project progresses. It's also possible to expand or reduce the role of individual members if their expertise becomes more or less relevant over time.

3. Begin choosing team members

At this point in the team development process, you have identified the projects you plan to assign the team and the skills relevant to those projects. It's time to assign members to your multidisciplinary team with the required expertise to meet your goals. Look for candidates who:

  • Collaborate well with others. It's important to note that relevant expertise alone does not make someone a good team member. The ability to collaborate with other members of the team and respectfully engage with people who may have opposing viewpoints is just as important.

  • Effectively communicate their ideas. The ability to communicate one's ideas and perspective in a way others can engage with is very valuable in collaborative efforts. A multidisciplinary team may have members who lack the specific expertise the communicator has. The ability to explain complex ideas to these less knowledgeable members is important if the team is going to use everyone's unique skills.

  • Bring interesting, new perspectives. While perhaps not essential, multidisciplinary teams benefit from team members who come from many different backgrounds. The fields people have worked in previously, the colleges they went to, and the culture they grew up in all influence the way they think and approach problems.

  • Embrace growth and learning. One of the strengths of multidisciplinary teams is the tendency for members to learn from each other over time. Candidates who show a love of learning, especially learning skills outside their specialty, can experience amazing growth during collaborative efforts on multidisciplinary teams.

If the project the team is going to be assigned to is particularly important, you may want to treat this stage similarly to the hiring process. Once you have identified relevant candidates, interview them to gauge their interest and better understand if they might be good for the team's dynamic.

Related: Characteristics of Effective Teams (With Tips and Importance)

4. Establish leadership and develop a team charter

In multidisciplinary teams, clarity of purpose and leadership are both important to achieving the team's goals. The goal when choosing leadership is to find someone who can encourage collaboration between the varied experts on their team. You want an individual who can plan ahead and show talent in defining a course of action that uses the expertise of the team in the most optimal way they can. It helps if they have at least some basic knowledge on most of the fields their team members specialize in, but most important is that they can stay organized and facilitate communication.

Once you choose a leader for the team, write out a charter for the team. A charter establishes how a group operates, defining its:

  • purpose

  • objectives

  • roles

  • essential responsibilities

It helps to involve the team leader when drafting this charter. They may have unique insight into the team's dynamics and how to best organize the team to achieve its goals. By design, you have chosen a leader you trust to make important decisions for the team. Allowing them to influence the charter helps them guide the early stages of team development to best fit their leadership style.

Related: The Importance of Reviewing a Project Charter Example

5. Set a budget

Once you have formed a multidisciplinary team and established its goals, it's time to write out a budget. Meet with the team to discuss the resources they believe the project requires and discuss what is and isn't viable. Multidisciplinary teams benefit from a budget itemized by category. For example, they may have a significant developmental budget but a smaller marketing budget. Keep them aware of these limitations and explain why you have set things as you have. You can also revisit the budget later if issues arise or the team comes up with relevant ideas after the initial budget meeting.

6. Create a project schedule

Work with the team to set out a schedule for the project's progress. Establish a clear deadline for the project's various goals, working with the team to ensure the goal is realistic and achievable. This is an area where the cross functional nature of the team becomes apparent. It's often possible for a multidisciplinary team to work on many goals at once. For example, a product does not necessarily need to be complete for a team's marketing experts to begin developing sales materials for it.

7. Form clear lines of communication

By establishing clear lines of communication between the members of your multidisciplinary team, you make collaboration easier and help reduce the potential for confusion. Ensure the team knows the relevant points of contact for others on the team, how to share documents, the proper procedure for editing and otherwise altering material, and who to go to with questions relevant to different elements of the project. Your team may also benefit from being briefed on the basics of collaboration and how to disagree in a way that shows mutual respect for one's colleagues.

Related: Four Types of Communication (With Examples)

Now that we have reviewed steps and considerations you can form your own cross-functional team.

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