Best Practices to Enhance Collaboration Across Boundaries
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The document discusses best practices for enhancing collaboration across organizational boundaries, emphasizing the importance of matrix structures in cross-functional teamwork. It identifies four prerequisites for successful collaboration: shared goals, clear roles and decision authority, transparency, and standardized work processes. Additionally, it presents the challenges experienced by Hyundai Capital in implementing a matrix structure and outlines their approach to overcome these challenges through skill development and structural changes.
Best Practices to Enhance Collaboration Across Boundaries
- 1. Best Practices to Enhance Collaboration Across Boundaries Presented by: Rick Lepsinger, Managing Partner, OnPoint Consulting
- 2. “This idea that matrix does not work still exists today, even among people who should know better. Organization structures do not fail: managements fail to implement them correctly”. Jay R. Galbraith, Professor Emeritus at the International Institute for Management Development (IMS)
- 4. Objectives • Learn how cross functional teaming has evolved • Understand the benefits and challenges of cross functional teamwork • Learn the four prerequisites • Learn how Hyundai Capital overcame the challenges of cross-functional teamwork and built a powerful global business 4
- 5. • Emerged in 1960s in aerospace industry • Peaked during 1970s and 1980s as companies began to expand globally • In utility industry in 1980s and 1990s companies adopted matrix to capture economies of scale • Successful implementation of matrix structure at GE, Boeing, Dow Chemical, IBM, Shell Oil, Texas Instruments Brief History 5
- 6. Chief Executive Functional Manager Functional Manager Functional Manager Staff Staff Project Manager Staff Staff Staff Staff Staff Staff Project coordination Gray boxes represent staff engaged in project activities Classic Matrix 6
- 7. • Horizontal as well as vertical coordination • Alternative authority figures to those with hierarchical position power • Two (or more) bosses • Opportunities to efficiently share resources and expertise Characteristics of a Classic Matrix 7
- 8. • Fewer formal ties between matrix partners • More ambiguity regarding who your matrix partners are • Access to subject matter experts throughout the organization (e.g. more fluid, less formal structure) • Increased importance of maintaining lateral relationships From Grid to Network 8
- 10. (Intended) Benefits of a Matrix • Companies can focus on multiple business goals • Reduces cost and leverages economies of scale • Streamlines work processes and enhances efficiency • Eliminates silo mentality • Encourages sharing of best practices • Customer requirements are met more effectively • Allows for a quick response to environmental changes • Better serves specific market segments 10
- 11. Challenges of Working in a Matrix • Conflicting or unclear goals and priorities • Unclear roles and responsibilities • Ambiguous or shared authority • Shared resources • Silo-focused employees; conflict of loyalties • Leaders unaccustomed to sharing decision making • Lack of rewards and consequences for matrix performance; lack of motivation to make the matrix work 11
- 12. Polling Question: Your Challenges • Conflicting or unclear goals and priorities • Unclear roles and responsibilities • Ambiguous or shared authority • Shared resources • Silo-focused employees; conflict of loyalties 12
- 13. Building Cooperation and Collaboration: Four Pre-Requisites
- 14. The Foundation: Four Prerequisites • Shared goals and common ground • Clear roles, responsibilities and decision authority • Transparency and timeliness of communication • Standardized work processes 14
- 15. Shared Goals and Common Ground Why It’s Important • Aligns people’s interests; gives the group a shared purpose • Makes cooperation and collaboration desirable; encourages teamwork • Encourages people to communicate problems and results allowing for faster recognition and resolution of issues • Allows for autonomy and empowerment of team members; less monitoring is required 15
- 16. Shared Goals and Common Ground How To Do It • Clarify goals for the matrix team before functional, department or regional goals are finalized • Coordinate goals horizontally and ensure they are mutually supportive; review periodically and adjust as necessary • Make goal alignment a formal process and hold people accountable • Look for, and make explicit, shared values and beliefs among matrix partners (e.g., customer focus, safety, quality, beating the competition) 16
- 17. Business Strategy Strategic Initiatives Strategic Objectives SBUs Goals SBU 1SBU 1SBU 1SBU 1 Matrix Teams Goals RegionsCustomersProductsMarkets R&D HR IT Sales Marketing (3 – 5 years) (Annual) Coordinate 1 2 3 Coordinate Manufacturing
- 18. Clear Roles and Decision Authority Why It’s Important • Defines when cooperation is needed and what it looks like • Ensures everyone knows what’s expected of them; enhances accountability • Clarifies who to involve in solving problems and making decisions 18
- 19. Clear Roles and Decision Authority Why It’s Important • People tend to work better together; fewer arguments • Helps ensure both process and people mesh together seamlessly • Ensures work in not overlooked, duplicated or completed inefficiently 19
- 20. Clear Roles and Decision Authority How To Do It • Share descriptions of job roles and responsibilities with matrix partners • Work out roles and decision authority in advance for the key decisions/activities the matrix team is responsible for • Involve key stakeholders when discussing and deciding on roles and decision authority • Communicate who has accountability and authority for key decisions/activities to the next level 20
- 21. Clear Roles and Decision Authority How to Do It 21 Responsible Accountable Consulted Informed RACI Model R A C I
- 22. RACI Chart Decision/ Activity 1 Decision/ Activity 2 Decision/ Activity 3 Function/Department R C A Function/Department A A R Function/Department C I C Function/Department I R C Function/Department C I I 22
- 23. Ensuring the RACI Model Works • Focus on the 3-5 most critical decisions and activities for which the matrix partners are responsible (apply the 80/20 role) • Involve key stakeholders in the discussion • Build and sustain high levels of trust • Inform the next level down about role agreements • Review and revise role agreements based on experience 23
- 24. Transparency Why It’s Important • Ensures everyone has the information they need to do their job • Minimizes contradictions, distractions, and confusion • Enables departments and functions to work together to solve problems; informs planning and goal setting • Speeds up problem solving and decision making • Improves productivity and job satisfaction Improve Communication and Transparency 24
- 25. Transparency How To Do It • Create formal communication plans that outlines who communicates what to whom • Use action plans to document agreements and expectations regarding accountability and timing • Make sure the right people are involved in decisions • Check for understanding of what was said before responding or taking action Improve Communication and Transparency 25
- 26. Standardized Work Processes 26 Generate Order Submit Order Generate Order Submit Order Generate Invoice Assemble Product Ship Product The Order Fulfillment Process Sales Accounting Manufacturing And Production MIS 205 E-Business & Information Systems
- 27. Standardized Work Processes 27 Why It’s Important • Helps realize potential economies of scale • Ensures consistency and continuity across functions and departments; improves workflow and enhances reliability • Avoids overlaps and duplication of work; minimizes conflicts, enhances speed, improves efficiency, and reduces costs • Supports the sharing of information and improves transparency across work units; supports planning and goal setting • Allows for shared performance metrics
- 28. Standardized Work Processes 28 How to Do It • Identify and agree on the core processes with global process owners • Use business process mapping to diagram the workflow, clarify roles and responsibilities, and identify “pinch points” and opportunities for improvement • Establish local process variants off the standard process • Establish change management procedures to keep core processes and local variants aligned • Establish reporting capability to monitor the local variants and their cost and timeframe
- 29. Polling Question Which of the four pre-requisites are in place in your organization? • Shared goals and common ground • Clear roles and decision authority • Transparency of communication • Standardized work processes 29
- 30. Sustaining Collaboration and Cooperation: The Skills
- 31. • Building and sustaining trust • Influence without authority • Conflict management • Involving others in decisions • Emotional intelligence • Interpersonal communication skills 31 Skills For Effectively Working on a Matrix
- 32. Collaborating for Success in Hyundai Capitals Global Matrix
- 33. Who is Hyundai Capital 33 • Hyundai Capital Services (HCS), serves as the financial unit for the Hyundai Motor Group. • Over the last decade, Hyundai Capital has grown immensely— providing loan servicing to Hyundai Motor Company’s many customers in the USA, UK, Europe, Australia, China, Korea, Canada, Brazil, Russia, and India. • Each of the regions that HCS services are managed by different “global entities” with headquarters located in their respective region.
- 34. The Problem 34 Between the different Global Entities, central headquarters, the Global Business Development (GBD) group, and the Hyundai Motor Group, HCS was faced with numerous challenges, including: 1. Cultural Differences Between the Global Entities and Headquarters 2. Misalignment of Goals Between HCS, the Global Entities, and the Motor Group. 3. Complicated Organizational Structure with Unclear Roles and Decision Authority.
- 35. The Solution 35 1. A Data-Based Approach to Improving Collaboration • Interviewed a cross-section of executives from HCS, the Global Entities and GBD on the challenges of working in a matrix structure. • Ensure we had a solid understanding of the issues and challenges team leaders and team members faced on a daily basis. • Clarified what was currently being done well to support multi- functional teaming and what factors inhibited team performance.
- 36. The Solution 36 The results of the interview findings were used in three ways: • Created a shared view among senior leaders about what the opportunities for improvement were—creating a common starting point • Established a benchmark that could be used to measure progress and evaluate the effectiveness of the intervention • Information was used to design the solution and customize the materials
- 37. The Solution 37 2. Working On Both Skills and Structure • One of the most important findings from the interviews was that not only were there cultural differences and skill development needs, there were also structural issues • In addition to a lack of clear roles, decision authority and transparency of communication, there was a lack of shared (or even complementary) goals among the different groups as well as a lack of standardized processes.
- 38. The Solution 38 3. The Training Sessions Managers from each region and function participated in skill building activities and problem solving conversations focused on real-world issues.
- 39. The Solution 39 3. The Training Sessions: The Agenda • Benefits and challenges of working in a matrix • Case Study – Nike’s Global Women’s Fitness: Driving Strategic Integration ‒ Identify best practices to realize the benefits of the matrix • Four pre-requisites: shared goals, decision authority, standardized processes and transparency of communication • GRID self-assessment: clarify the current state of your matrix team ‒ What factors are in place, areas that warrant attention, actions to close gaps
- 40. The Solution 40 3. The Training Sessions: The Agenda • Building and sustaining trust ‒ Assess individual trustworthiness ‒ Assess the extent to which you are using best practices for building trust among the members of a matrix team ‒ Identify action to close gaps • Influencing without authority ‒ Self-assessment: What’s your primary influence style • Interpersonal communication skills • Involving others in decisions
- 41. The Solution 41 3. The Training Sessions: Outcomes As a result, the Hyundai teams were able to: • Assess and agree on the current state of their matrix organization • Understand the challenges facing other business units • Build trust among matrix team partners and open lines of communication • Understand how to gain support for ideas without authority • Develop the emotional intelligence skills needed for working in a global matrix (active listening, empathy, and balanced response)
- 42. The Solution 42 4. Consulting with Senior Leaders Met with Hyundai Capital’s senior leadership team to discuss the organization’s structural issues (e.g., shared goals, clear roles, standardized processes) and made recommendations designed to make collaboration across organizational boundaries both desirable and feasible.
- 43. The Results 43 HCS experienced four major changes: • HCS opened discussions with the Motor Group to align goals and address the mismatch between production targets and the requirements of sound loan-making practices. • HCS and HQ reorganized to improve transparency and communication and clarified who the Global Entities needed to contact and when which helped improve the speed and quality of decisions and overall trust.
- 44. The Results 44 HCS experienced four major changes: • Clarified roles and decision authority among GBD, Global Entities, and HQ. The simplification of organizational structures and more clearly-defined decision authority reduced confusion and miscommunications that wasted time and resources. • Provided managers with the skills to build and sustain collaboration. Through the face-to-face meetings, managers gained an understanding of the Korean culture and improved their soft skills, helping them better understand and influence others and gain commitment and cooperation.
- 45. Thank you! www.OnPointConsultingLLC.com | 212.472.8081 Want to learn more about Working Effectively Across Organizational Boundaries? Check out our book “Closing the Execution Gap”.