05 Nov C-level Functions Need to be More Team-centric, Networked, Agile

In the last two years of Deloitte’s global research culminating in the 2018 Global Human Capital Trends survey, the most important human capital trend identified by its survey respondents has been the need to break down functional hierarchies and build a more networked, team-based organization.

This year, this trend has reached the C-suite. Senior leaders must now move beyond functional roles and operate as a team. They must combine business unit and functional ownership with cross-functional teams to run an agile organization or network.

With the respondents surveyed this year, 51 percent rated “C-suite collaboration” as very important. Also, it found that respondents at organizations with the highest level of CxO cross-collaboration were the most likely to anticipate growth of 10 percent or more. However, 73 percent of respondents said their C-suite leaders rarely work together on projects or strategic initiatives.

It is now even more vital for senior leaders to get out of their silos and work with each other more. In navigating today’s changing business environment and cross-disciplinary challenges, a company’s top leaders must act as one. Deloitte calls this new, collaborative, team-based senior executive model “the symphonic C-suite.”

Akin to a great symphony orchestra, a symphonic C-suite brings together multiple elements: the musical score, or the strategy; the different types of instrumental musicians, or the business functions; the first chairs, or the functional leaders; and the conductor, or the CEO.

In this model, C-suite members must not only lead their own area of responsibility, but also collaborate with other functional leaders, work on teams that affect the enterprise’s strategic direction, and influence and inspire networks of teams throughout the organization. In short, the goal is a symphony of specialized experts playing in harmony—instead of a cacophony of experts who sound great alone, but not together.

This wasn’t always the way C-suites behaved. In the 1800s and early 1900s, the CEO stood alone at the top, making most of the important decisions and delegating responsibility to functional managers in the business.

This model was later extended to create a series of “specialist heroes,” each with a “C” in his or her title: chief financial officers, chief information officers, chief human resources officers . . . the list goes on and on. Each was given responsibility to “own” his or her domain, operating under a “divide and conquer” model.

With this increased specialization, however, a new dynamic emerged: The individual CxOs did not, as a rule, work closely together. This made sense in a relatively static, predictable business environment where most problems had readily identifiable root causes, were limited in scope, and required deep functional expertise to solve.

But the current business environment is a far cry from what it was in the 1980s, which saw a huge increase in the number and type of functional C-suite roles.

Frequent marketplace disruptions, a global economy, and the accelerating rate of technological change mean that the problems companies now face are more difficult, more complex, and more multidimensional than ever.

More and more problems are of the “wicked” variety—problems with multiple roots and drivers that cannot be effectively solved by one party working alone.

In a dynamic environment demanding cross-disciplinary collaboration and deep functional expertise, operating as a symphonic C-suite makes sense, allowing leadership teams to tackle issues that no single function can satisfactorily address.

Today’s digitally savvy, well-informed consumer is demanding that businesses deliver not only good products, but a great end-to-end customer experience—from the time he or she becomes aware of a product through the end of the product’s life cycle. Rising to this challenge demands that organizations, especially their global mobility teams, work across functions to understand and fulfill customer needs at every touch point.

As another example, consider a company’s need for agility in navigating rapidly shifting markets, technologies, competitors, and customer expectations.

If an executive team does not operate as an integrated decision-making unit, they risk moving too slowly to align the organization with the demands of its time and place. In a sense, the symphonic C-suite’s evolution can be seen as a logical extension of the movement to networks of teams that has been occurring for some time at lower organizational levels and across the broader economic and social landscape.

Functional units are organizing around teams, initiatives, and agile projects; businesses are building ecosystems and networks; even public institutions are forming new coalitions. And in these efforts, what has become clear is that cross-functional teams can often get work done more quickly and effectively than a siloed, top-down approach.

Not every problem requires every C-suite officer to get involved. Here are some specific ways that a symphonic C-suite might want to address different challenges:

• Digital business models. A high-performing digital business aims to deliver its products and services to customers as an integrated experience. To achieve this, the chief marketing officer (CMO) and chief information officer (CIO) can work together so that front, middle, and back-office systems converge to provide a seamless customer experience.
• The future of work. CIOs and CFOs can work with each other and with business leaders, supply chain executives, and the CHRO to pilot and implement automation solutions and redesign work around new platforms in a way that creates meaningful jobs, careers, and development opportunities for people.
• Brand protection. In a connected and transparent world, both customers and employees—some of whom may be one and the same—are inextricably linked to the corporate brand. CMOs and CHROs, along with the chief risk officer, could collaborate to manage an organization’s total internal and external brand.
• Innovation. Chief innovation officers and chief research officers can play a critical role in driving innovation across other functions as well as across the business. When one team innovates, those innovations can affect work in other teams, allowing all teams to learn together.

The transition of C-suites to full “symphonic” mode still appears to be in its infancy. Fifty-four percent of respondents said their companies are not ready, or only somewhat ready, for the level of executive-team collaboration they believe is now required.

Where can C-suites start? A first step is for the CEO to review priorities for each C-suite leader and determine how each can have an impact more broadly across the organization. Next, cross-disciplinary projects should be prioritized so that CxOs can form specific alliances and align their efforts to drive success.

Last, executive teams need to put those cross-disciplinary projects on the agenda, not only for themselves, but for the organization as a whole to increase the visibility of their collaboration to the rest of the workforce as a model to follow.

In executing this shift, teamwork, influence, and expertise gain in value. No longer can C-suite executives succeed only through authority—they must create followership among their peers. The need for CxOs who can do this means assessing potential leaders in new ways.

Achieving C-suite collaboration also requires performance management systems and career paths that facilitate teaming, and give leaders cross-functional experience. L’Oréal Group has reimagined its performance management systems to emphasize the importance of teamwork, adopting a new credo: “The team is the new hero.”