The development of teams and teamwork has grown dramatically in all types of organizations for one simple reason: No one person has the ability to deliver the kinds of products and services required in today's highly competitive marketplace. Organizations must depend on the cooperative nature of many teams to create successful ventures and outcomes.
Teams can be vertical (functional), horizontal (cross‐functional), or self‐directed (self‐managed) and can be used to create new products, complete specific projects, ensure quality, or replace operating departments.
Functional teams perform specific organizational functions and include members from several vertical levels of the hierarchy. In other words, a functional team is composed of a manager and his or her subordinates for a particular functional area. Accounting, personnel, and purchasing departments are examples of functional teams.
Cross‐functional teams are made up of experts in various specialties (or functions) working together on various organizational tasks. Team members come from such departments as research and development, design, engineering, marketing, and distribution. These teams are often empowered to make decisions without the approval of management. For example, when Nabisco's executives concluded that the company needed to improve its relationship with customers and better satisfy customers' needs, they created cross‐functional teams whose assignments were to find ways to do just that. Although functional teams are usually permanent, cross‐functional teams are often temporary, lasting for as little as a few months or as long as several years, depending on the group tasks being performed.
Self‐directed work teams, or self‐managed teams, operate without managers and are responsible for complete work processes or segments that deliver products or services to external or internal customers. Self‐directed work teams (SDWTs) are designed to give employees a feeling of “ownership” of a whole job. For example, at Tennessee Eastman, a division of Eastman Kodak Company, teams are responsible for whole product lines—including processing, lab work, and packaging. With shared team responsibilities for work outcomes, team members often have broader job assignments and cross‐train to master other jobs. This cross‐training permits greater team flexibility.
No matter what type of team is formed, the benefits of teamwork are many, including synergy and increased skills, knowledge, productivity, flexibility, and commitment. Among the other benefits are increased job satisfaction, employee empowerment, and improved quality and organizational effectiveness.