How well do people in your company work together across organizational units?  Is your company structure rather hierarchical and formal or does it stimulate people to create cross-company networks? Are people able to collaborate effectively with people working in different company divisions, in other countries with different cultures?  Are people willing to share their expertise and information with colleagues in other units?  ‘New products will increasingly be the result of co-creation processes,’ the CEO of a leading chemicals firm recently said to me. ‘What we really need is social innovation. Not only innovation in a technical sense, but innovation of our organization.  How to organize work in a flexible way?  How to stimulate cross-unit collaboration that brings tangible results?  There is no doubt in my mind that we need better collaboration across company units, across different companies even.  But organizing this is easier said than done.’

Building cross-company networks among people that cut across formal lines of reporting, can be a useful way to stimulate effective transfer of best practices and technologies, agility, innovative thinking – all of which increasingly determine your company’s competitiveness in this era of relentless change. (Read more about the power of cross-organizational networks).

This not to say, however, that hierarchical structures and efficiency-based management processes have outlived their usefulness.  Nor do I think that cross-company networks are always a good thing.  Networking with no intelligent strategy behind it can undermine performance.  The challenge is, therefore, to complement the good management processes in your company with result-based cross-company networks.  Networks that add value, because benefits outweigh the costs.

How to build effective cross-unit networks in your organization

There is no golden rule, as the specific barriers preventing people from collaborating across borders (divisions, countries, cultures) differ from company to company.  But I have helped executive leaders to increase the quality and effectiveness of cross-company collaboration for many years now.  When it comes to building effective cross-company networks, I have found 3 rules of thumb particularly useful:

1.  Map existing networks first

Every organization has its own informal networks.  Make sure you understand where they are, who is in it, how they operate, and what their outcome is.  Creating a cross-unit network map is a good way to start.  If you know where the valuable and the weak spots are, you can tailor your interventions – instead of shooting in the dark. Focus on the networks that add value, and eliminate the networks that do not.

2.  Focus on diversity in relationships, not on number of connections

Remember why diversity  – diversity in age, personalities, experience, technological skills, etc. – is good for business teams (read more about the value of diversity)? Research shows that it is diversity in cross-company networks that leads to faster and better innovation (source:  Morton Hansen, Collaboration, p. 127).  So build diversity, not size. This requires special attention of leaders. In many situations this diversity in relationships means that people are pushed outside of their comfort zones. People maybe need to be stimulated to engage in relationships that do not feel natural at the beginning. The quality of the collaboration probably will not be high at once, but will need to be developed and coached.

3.  Tackle people alignment issues head-on

‘I wish we had done this earlier.’  I often hear it after team alignment sessions, when cross-unit teams have experienced a deeper level of understanding, openness and trust, resulting in mutual commitment, a higher quality of collaboration and more effective execution.  Here is an easy list of questions that can help you clarify whether you are dealing, in cross-company teams, with genuine commitment, or compliance. Tackling people aligment issues head-on is important.  In my experience, a focused and targeted approach to support and coach people at building effective cross-company relationships will facilitate effective networks, and will save lots of time and money later on.

Thoughts?

Aad is a global business advisor, change leader, senior executive team facilitator, leadership coach, and frequently asked keynote speaker. He is founder and managing partner at HRS Business Transformation Services where he works with executives and leadership teams globally in three key domains: ‘leading complex change’, ‘cross-cultural leadership’, and ‘post-merger integration’. Find out more about Aad and HRS’ services. If you would like to invite Aad to your organization contact us.