10 leadership skills for effective cross-functional teams

Anyone familiar with the exhilarating (or occasionally exasperating) world of cross-functional teams knows that it takes more than just a cool job title and a cape made of spreadsheets to lead it to victory. 

Today, collaboration between different departments is becoming increasingly common: Marketing, engineering, sales, and finance teams work together on shared projects, which means that leaders need a unique set of skills and tools to navigate more fluid structures and foster teamwork. 

And while strong leadership and people management skills are obviously important – and it’s always a good idea to test for those when hiring your future leaders – they are clearly not sufficient to drive results. 

In this article, we’ll explore the top 10 skills that enable leaders to unlock the potential of cross-functional teams, overcome obstacles, and lead them to success, regardless of whether the project takes a week or a year to complete. This will enable you to hire successful leaders, be it internally or externally. 

But first, let’s start with the basics.

What are cross-functional teams? 

Cross-functional teams use a holistic approach to solving problems. They bring together team members from different business units in the organization, such as marketing, sales, product, finance, and more. 

They’re composed of individuals with diverse expertise, skills, and backgrounds, which enable them to contribute to the team’s goals in different ways and bring fresh ideas to the table. 

Team members come together to work on a specific project or goal, meaning that cross-functional teams are often temporary. Regardless of the project duration, however, they need strong leaders to succeed.

The main purpose of cross-functional teams is to leverage team members’ diverse knowledge and perspectives to enhance collaboration, problem-solving, and decision-making. 

By bringing together individuals with different areas of expertise, cross-functional teams are able to solve complex challenges that require input from multiple disciplines.

What are the benefits of cross-functional teams?

Cross-functional teams are designed to break down silos, encourage collaboration, and leverage diverse expertise to achieve organizational goals and solve complex problems.

Some of the main benefits of cross-functional teams are: 

• A diversity of perspectives: Cross-functional teams pool a wide range of skills, knowledge, and experiences from different departments, leading to a more in-depth understanding of the problem.

• Improved communication: Organizations can often become siloed into different business units. Cross-functional teams help break down silos by offering team members the opportunity to communicate and collaborate directly, fostering better coordination across departments.

• Increased creativity and innovation: With a diverse set of perspectives and expertise, cross-functional teams will often arrive at more innovative and creative solutions by using new approaches to common problems. 

• Enhanced accountability: As team members come from different areas, there is a sense of collective ownership and shared responsibility for the project’s success, which can lead to increased accountability.

• Knowledge sharing and learning: Team members have the opportunity to learn from each other, expanding their knowledge beyond their own functional area. This enables the team as a whole to better evaluate options and potential consequences, leading to more well-rounded and informed decision-making processes.

What are the challenges of cross-functional teams?

Cross-functional teams offer a wealth of benefits. They also come with their fair share of potential hurdles, such as: 

• Communication problems: With team members from different departments and backgrounds, effective communication in cross-functional teams can become a challenge. Differences in terminologies, priorities, and perspectives can create misunderstandings and hinder information flow.

• Goal misalignment: Ensuring that everyone is on the same page when it comes to project goals and objectives can sometimes take time, especially if each team member needs to contribute to their original team in parallel. Different departments may have their own priorities, which makes it crucial to align and synchronize efforts towards a shared vision.

• Power struggles: When multiple disciplines converge, conflicting opinions and power struggles can arise. Managing conflicting interests requires skillful navigation and fostering a collaborative mindset.

• Resource allocation: Allocating resources fairly across different teams and departments can be a juggling act. Competing priorities and limited resources require careful decision-making to avoid conflicts.

• Accountability ambiguity: Determining individual and team accountability can become blurred in cross-functional settings. Establishing clear roles, responsibilities, and performance metrics will help promote accountability and drive results.

• Time management challenges: Coordinating schedules, availability, and timelines across various teams can be a logistical nightmare. Make sure you’re implementing efficient time management and coordination to keep projects on track.

Cross-functional team management: Do cross-functional teams have a leader?

In short, yes. Cross-functional teams need a skilled leader to achieve their goals, but the leadership role might differ from other teams. Leadership may look more like a shared responsibility between a few people and require establishing a delicate balance of influencing, guiding, and serving the team.

Sometimes, a leader emerges naturally. A true multipotentialite who always has the best answers to the toughest questions is a common example. Other times, leaders are chosen before the team is formed and help shape the group. 

Leaders often come from within the organization. Nevertheless, on occasion it may make sense to hire externally, especially for bigger, high-stake projects that your company simply doesn’t have the capacity to tackle.

Leadership might sometimes be a collaborative effort, with team members taking turns to lead based on their strengths and the project’s needs. 

Keep in mind that there are many different leadership styles, all of which have their advantages and downsides – and not all are appropriate for cross-functional teams. 

An autocratic leader might not be ideal for a team that relies on innovation and creativity to solve problems, but a laissez-faire leadership style might leave the team struggling to set goals and work towards them. 

Depending on the project and its requirements, you might need someone who has a democratic, pacesetter, or transformational leadership style. 

10 leadership skills for effective cross-functional teams

Let’s now explore the ten leadership skills that enable cross-functional team leaders to manage projects effectively and ensure everyone can stay on track and contribute to the team’s goals.

1. Communication

First and foremost, leaders must be able to communicate effectively with team members who have different roles. This helps ensure a clear understanding of goals and expectations and prevents misunderstandings.

Some of the key communication sub-skills for leaders of cross-functional teams are: 

• Active listening: Leaders need to listen attentively to team members’ concerns and ideas and show their understanding by providing adequate feedback. They can then engage the whole team in identifying and discussing the best ideas to make progress. 

• Conflict resolution: Managing and resolving conflicts within a team is a key skill for leaders of diverse teams. They need to ensure that everyone feels heard and that resolutions are fair to all involved. This helps create an environment where everyone feels valued.

• Non-verbal communication: Non-verbal communication is an important sub-skill that enables leaders to better understand team members by paying attention to non-verbal cues – and expressing themselves better.

There are many ways to assess communication skills in the workplace, but one of the most effective methods is to use our Communication test before you move on to the interview stage. After that, interviews help you get deeper insights into each applicant’s communication skills and style.  

2. Emotional intelligence 

Emotional intelligence is among the most important skills for leaders, arguably even more so than technical skills and competencies.

Leaders must be able to recognize and manage their own emotions, as well as those of their team members. For this, they need sufficient self-awareness, social awareness, self-management, and relationship-building skills. 

Some of the most important sub-skills here are: 

• Empathy: Leaders should understand and empathize with team members’ perspectives and needs, offering support and guidance as needed.

• Relationship building: Building and maintaining strong relationships with team members, stakeholders, and other key players in the project is critical for the team’s success. Relationship building depends on an individual’s capacity to build trust and create a work environment where everyone feels valued, respected, and supported.

• Resilience: Cross-functional teams might meet plenty of challenges while working on a project, so the leader’s ability to bounce back from setbacks and challenges and maintain a positive attitude is essential. 

3. Leadership skills

Of course, leadership skills are essential for anyone in a leadership role, and even more so when managing a diverse team. 

Some of the key sub-skills leaders need are: 

• Strategic thinking: Leaders should be able to think long-term and anticipate potential challenges or opportunities, and adjust their strategy accordingly.

• Delegation: Leaders should be able to delegate tasks to team members based on their strengths and expertise while remaining accountable for the overall outcome.

• Coaching: Leaders should be able to coach team members to help them build new skills and achieve their potential.

You can assess leadership skills with a Leadership and People Management test to see whether your candidates have what it takes to influence and guide others. 

4. Innovation

The ability to generate new ideas and approaches and encourage team members to innovate is essential for cross-functional team leaders. 

Some of the important sub-skills in this category are:

• Creativity: Leaders should be able to think outside the box, generate new ideas and solutions, and encourage creativity in team members.

• Cognitive flexibility: Being open to change and able to adapt a strategy as needed is essential for leaders. Additionally, they should welcome feedback and ideas.

• Visionary thinking: The most skilled leaders will be able to think beyond the immediate needs of the team and develop a long-term vision that aligns with the organization’s mission and values.

5. Teamwork 

Teamwork is among the most important skills when managing a team of employees from diverse backgrounds. Not everyone will have the same vision and ideas, so it’s the leader’s responsibility to align goals and make sure everyone is on the same page so they can collaborate well. 

Important teamwork sub-skills include: 

• Accountability: Leaders should take ownership of their decisions and actions, holding themselves and team members accountable for their commitments.

• Collaboration: Fostering a collaborative environment where team members work together towards a common goal is vital for diverse teams. 

• Feedback: Leaders should know how to give constructive feedback to all team members, helping them to improve performance and achieve common goals.

6. Organizational skills

Leaders of interdisciplinary teams need to be expert organizers to make sure everyone is clear on what they need to do, when they need to do it, and who to ask for help when needed. 

Additionally, they must ensure that a project can be completed within the allotted time and resources.

Some important organizational sub-skills include: 

• Decision-making: Leaders need a clear decision-making process, which includes receiving input from all team members, considering potential risks, and making swift decisions.

• Time management: Prioritizing tasks and managing the team’s time is crucial for the success of each project. You can use our Time Management test to assess this skill. 

• Planning: Managers need to be strong planners and able to develop and implement plans that support organizational goals. For this, they should take into account resources, timelines, and potential obstacles.

7. Business judgment 

Strong business judgment skills are essential for managing complex projects, making sound decisions, and communicating with other stakeholders whenever necessary. You can use our Business Judgment test to evaluate potential leaders.

Key sub-skills are: 

• Risk management: Leaders should be able to identify risks and implement the right strategies to mitigate them, ensuring a project’s success.

• Transparency: Remaining transparent in communication and decision-making helps leaders ensure that everyone understands a project’s stakes and goals. 

• Resource allocation: The ability to allocate resources effectively and to balance priorities that are sometimes competing is instrumental to achieving the team’s goals.

8. Cultural competence

Inclusive leadership isn’t just an empty phrase. 

Making sure your leaders are culturally sensitive and inclusive means they’ll be able to work effectively with team members from different cultures and backgrounds and navigate differences respectfully, enabling employees to bring their “whole person” to work. 

Cultural competence helps team members feel seen and understood and promotes open communication and a sense of belonging and engagement. 

Some of the key sub-skills of cultural competence are: 

• Cultural sensitivity: Cultural sensitivity refers to the ability to understand and respect different cultural perspectives and practices, using that knowledge to create a more inclusive work environment.

• Culture add: If there’s an alignment between your organizational culture and the culture of your leaders, and if you’re hiring not just for culture fit but for culture add, each manager can bring new ideas and perspectives to the table. 

To assess cultural competence, you can use our Culture Add test in the initial stages of your recruitment funnel.

9. Networking and negotiation 

To drive cross-functional projects to success, you need strong leaders who can negotiate with other teams and business units and ensure they have the right resources (time, budget, and people) to achieve their goals. 

Formal and informal networks are equally important, and leaders should know how to navigate them to achieve their goals. For this, they need to know who the “central connectors” and “brokers” within each network are – i.e., the people consulted by others for their expertise or those who put people in touch with each other.

Although it might not be obvious, the two skills are closely related:

• Negotiation: Negotiation is the ability to communicate effectively with others and find common ground in order to reach outcomes that are beneficial for all sides. You can use our Negotiation test to assess this skill. 

• Networking: Networking is the ability to use negotiation skills to build and maintain relationships with others in the organization and leverage those connections to benefit the team.

10. Technical and role-specific skills

Leaders of cross-functional teams don’t need to be experts in every team member’s field, but they certainly need a solid understanding of the tasks and responsibilities of each individual. 

This is particularly important for clearing roadblocks for the team (and for individual team members) without slowing down everyone’s progress. 

Here, we have listed two key sub-skills – technical expertise and data analysis – but of course the list is non-exhaustive. The full scope of the technical and role-specific skills your leaders need will depend on the team and its goals, so this is just a starting point: 

• Technical expertise: The ability to understand and apply technical knowledge relevant to the team’s work is essential for managers of cross-functional teams, as it enables them to solve problems and make informed decisions.

• Data analysis: Leaders need to have big-picture thinking, being able to look at data to identify trends and extract meaningful insights. They can use that information to develop strategies that drive the team’s success.

In our test library, you can find many role-specific skill tests and software tests to help you find the perfect fit for your cross-functional team. 

Use skills testing to find the right leader for your cross-functional team

Whether you want to recruit the leader of your next cross-functional team internally or externally, the entire process becomes much easier with the right tools – and a skills testing platform is the best choice for assessing talent.

Although we often refer to our platform as a “pre-employment testing platform,” it’s also used for internal assessments and for informing internal mobility or promotion choices.  

Skills testing is an important part of the holistic hiring process, and it enables you to evaluate potential candidates impartially and without bias. With TestGorilla, you can build an assessment of up to five tests to compare each person’s skills and see who has the highest leadership potential. 

Simply head over to our test library to find the right tests for your cross-functional team leaders – or sign up for a free demo to see how TestGorilla can help you identify the best talent.