To be truly agile, an organisation needs to be able to collaborate effectively, in order to make the best decisions that account for the wider business picture.
Many businesses are still organised in traditional departments: Marketing, CRM, Digital, Analytics, Finance, Commercial and so on. These teams were set up long ago to provide specialisation within different areas of expertise. As businesses grow, however, the teams expand in size and can diverge in their ability to work effectively together. Often as teams have scaled up, we have also focused their KPIs on conversion metrics within their own department, and these KPIs don’t always end up neatly aligning with each other. It is very common to see teams at odds as they chase their targets; for example, an acquisition team is targeted on volumes of net adds, regardless of the quality of the customer or the discount given to acquire them. This can then lead to frustration in the CRM team who are tasked with retention, but who have a high churn rate from the low value new customers. Until we can find a way to align everyone on the wider business goals by collaborating, we will not be successful.
Many businesses have started to realise that cross-functional teams are the way forward. If we can take colleagues from our marketing, CRM, digital, analytics, creative, legal, finance teams and put them together to achieve a common goal, then we can much more effectively unite the different specialisms required for end-to-end thinking.
However, simply changing reporting lines or restructuring a team will not always drive the desired results. We have seen some organisations simply shift their silos from horizontal departments to vertical “cross-functional” teams. When moving to cross-functional working, we must establish how different cross-functional teams fit together to still ladder up to our business goals. And again, it is essential that we have a purpose and KPIs that drive the right behaviours.
In the last decade a form of agile working driven by squads, tribes and chapters has become more common. Pioneered by Spotify, this ‘squad, tribe, chapter’ structure aims to organise people from different specialisations into autonomous teams (squads). Each squad of collaborating specialists works towards a shared purpose. Each of these squads then works with other squads towards a common overarching goal, in a squad grouping called a tribe. Lastly, within each squad each different specialisation (e.g. CRM, UX, Paid Media, Insight) shares best practice and learning and development with their fellow practitioners across different squads; these specialisation groupings are known as chapters. Chapters help with talent development and reduce the risk of squads becoming their own silos.
Getting the right setup of roles within squads can be a huge step towards a highly productive, collaborative working environment. It’s vital to ensure both that they have the essential skills to meet their goal and also have a level of autonomy within the headcount limitations of the business.
For a team to be truly effective, they must be autonomous. This requires two things:
- Empowerment to make their own decisions, towards their targets, without the need for further levels of sign off
- The end-to-end skills required to not be dependent on an external team working to different time frames and priorities
The latter point is sometimes misinterpreted. Having autonomy in the team does not mean that every role or skill required must be in every squad. Sometimes this isn’t practical from a headcount perspective. It can also result in more niche roles not having enough work if deployed only to one squad. Sometimes it is best to have certain skills offered through a competence centre or shared service, working across multiple squads. Getting the right balance is important to match productivity with efficiency.
As well as a reorganisation of how they work, the most effective businesses in this space have gone so far as to change how teams and people commit to working with each other. They have embraced a “culture of collaboration”, forming new social contracts (or ways of working documents), written by their own teams. They have even changed recruitment processes to ensure new hires’ cultural fit within the collaborative teams is equally (if not more) important than their technical skills.
While this can all sound like quite a lot to consider, this level of change does not happen overnight. The key consideration with reorganisation is that we must remember we are dealing with people. Changing the situation can lead to some level of anxiety and disruption. We must recognise that we need to support people through change, but if we remember to stay true to our core principle of agility, and take our people on the journey to collaboration with us, often they will ultimately drive our success.
If you’d like to read more about how boosting your organisation’s agility can positively impact your customers, you can download Merkle’s most recent Customer Engagement Report. Or contact us directly if you would like to learn more.