Change Management in the Public Sector:

The Use of Cross-Functional Teams

Dr Niall Piercy1*, Dr Wendy Phillips2 and Professor Michael Lewis1

* Corresponding author.
1
School of Management
University of Bath
Bath
BA2 7AY
United Kingdom
Telephone: +44(0) 1225 386742
Email: N.C.Piercy@bath.ac.uk; Mal20@bath.ac.uk
2
Bristol Business School
University of the West of England
Frenchay Campus
Bristol
BS16 1QY
United Kingdom
Telephone: +44 (0)117 965 6261
Email: Wendy.Phillips@uwe.ac.uk

We recommend you cite the published version. The publisher’s URL is

http://dx.doi.org/10.1080/09537287.2012.666913

Revised submission to:

Production Planning and Control

June 2011

Disclosure
This paper reports on research commissioned by the Welsh Assembly Government to codify and
analyze recent support/intervention experiences of seven local authorities.
 Change Management in the Public Sector:
The Use of Cross-Functional Teams

ABSTRACT

Adoption of change management best practices continues to be offered as a route towards

improved cost, quality and productivity of public services. These approaches are predominantly

drawn from private sector research and their application by the public sector remains a relatively

under-researched area. In this paper we investigate with three case studies of local authorities

one popular private sector change management approach - cross-functional team-based working.

We analyse the varying success of three cross-functional teams and the organisational

mechanisms that supported their implementation. We identify four requirements for success. The

first three concur with established private sector research on cross-functional working (the need

for the organisational leader to clearly support the team; cultural and structural issues that

support cross-functional integration; funding support), although we find greater subtlety needed

in their application in the public sector. Our research also uncovers a fourth critical requirement -

the need to break the status-quo and overcome resistance to change. We find no evidence that

these conditions cannot be met in the public sector and suggest cross-functional teams as a

positive approach to be integrated in public sector change programmes.

Keywords

Cross-functional, change management, team, public sector

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 1.0 INTRODUCTION

Public sector application of change and improvement approaches developed in the private

sector continues to be pursued despite the unique nature of operations management in the public

context. A failure to consider and respond to the distinctiveness of the public sector context can

present major problems when implementing change. We address one popular method for

improvement that has been broadly applied in many distinct change agendas – cross-functional

teams (CFTs) – and evaluate across three local authority case studies the methods that supported

team adoption, the contextual problems that arose, and ultimately the success of the method for

public sector change.

Public sector organisations must meet the ever-growing needs of a diverse range of

consumers whilst facing the prospect of reduced funding and little prospect of income generation

(Sundberg and Sandberg, 2006; MacIntosh, 2003; Boland and Fowler, 2000). In response to

these pressures, concepts commonly employed in the private sector are now filtering into

everyday practice in the public sector (Boyne, 2002, Pollitt and Bouckaert, 2004, Radnor and

Boadean 2008). Increasingly the public sector is implementing change management programmes

(Soltani et al, 2007) with a wide range of tools drawn from the private sector being employed,

for example: Just- in-Time (JIT) (Yasin et al, 2001), Lean improvement (Radnor and Walley,

2008; Radnor and Boadean, 2008), Performance Management Systems (PMS) (Micheli and

Kennerley, 2005) and Business Process re-engineering (BPR) (Macintosh, 2003).

It is necessary to examine whether techniques developed in the private sector are suitable

for the public sector context (Smart et al, 2004; Soltani, 2007). CFT based activity is a concept

that underpins many of the change approaches identified above, however, the assumption that

CFT can be applied with ‘off the shelf’ approaches from the private sector is a major concern

where there is little extant research to support such a proposition. In this paper we contribute to

resolving this problem, addressing two primary research questions: Can cross-functional teams

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be successfully used as part of change programmes in the public sector? and What approaches

support cross-functional teams in change management in the public sector?

While there exists empirical research on CFTs and change management in the private

sector, we are cautious of applying this to the public sector without the necessary context-

specific investigation. Therefore, the paper is focused on developing an understanding of the use

of CFTs within the public sector, focusing on the success of the CFT process as opposed to the

outcomes; specific team success outcomes may be attributed to a range of additional factors that

would be difficult to isolate.

2.0 CRITICAL SUCCESS FACTORS FOR CFT’S

Increasingly the public sector is implementing cross-functional approaches into its

organisations, as evidenced in a shift away from large, top-down, centralised public bodies,

following rigid procedures and reporting structures towards decentralised agencies operating

integrated CFTs (Athanasaw, 2003). Research into CFTs suggests that their popularity stems

from their contribution towards improved organisational performance, and the production of

novel outputs brought about by combining expertise from a range of sources (McComb et al,

2008). Since the creation of CFTs involves bringing together personnel from different disciplines

they can be employed as a means of overcoming organisational silos, where the division of

labour and tasks dominate and it is apparent that departments are working at cross-purposes

(Athanasaw, 2003). Additional benefits of CFTs include: increasing skills of the workforce; the

development of a common language and shared mental models; an enhanced understanding of

how the organisation functions as a whole and how individual employees fit within the

organisation; this in turn increases an employee’s feeling of worth and ability to work

interdependently; (Harman et al, 2002; Mendibil and Macbryde, 2005).

Although considerable work has been conducted in the area of CFTs, much of this has

been limited to the private sector, notably the area of new product development (NPD) teams

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(for instance: Brown and Eisenhardt, 1995; Kahn, 2001; Nakata and Im, 2010). A limited

number of studies have been conducted that focus on the public sector (McAdam and Donaghy,

1999; Gulledge and Sommer, 2003; MacIntosh, 2003; Sundberg and Sandberg 2003; Athanasaw,

2003), however, the majority of these studies adopt a business process approach to look at the

crossing of functional boundaries, particularly business process re-engineering (BPR). Building

on existing studies we provide an overview of the critical factors for successful CFTs before

considering how the public sector context may differ from that of the private sector where the

majority of this research was conducted.

2.1 Leadership Support

Existing private sector studies emphasise the importance of senior management support

in promoting cross-functional integration (Maidique and Walker, 1984; Harman et al, 2003;

Parry et al, 2010). Senior management involvement has been found to increase the motivation

and performance of team members (Swink, 2003) and senior managers can provide a clear vision

and agenda to inspire action (Harman et al, 2002). In the public sector, senior management

support is seen as essential in overcoming cultural perceptions, particularly from employees

expecting to follow a traditional, vertical career pathways (Athanasaw, 2003). It is only with

management support through team building, team training and team recognition that CFTs can

have a significant impact on organisational performance and improving service delivery.

2.2 Cross-Functional Integration

Much of the research into successful cross-team working in the private sector focuses on

the integration of team members drawn from a wide range of functional backgrounds. The

differences in knowledge and views potentially leads to differences of opinion and an

unwillingness to co-operate (Nakata and Im, 2010; Randel and Jaussi, 2003). Randel and Jaudi

(2003) found that that the degree of dissimilarity between functions does not have a negative

impact on performance, but that an individual’s performance as a team member is weakened

when their personal identity is in the functional minority. This is in line with the work of Nakata

4
and Im (2010), which highlights the need for strong social cohesion group identity as a means of

promoting “deindividualisation” and a move towards interdependent as opposed to independent

actions.

In a study of CFTs in the public sector, Athanasaw (2003) identified the composition of

the team as influencing success. The more representative a team is of the organisation as a whole

(i.e. including members of all relevant functions or departments, from different levels in the

organisational hierarchy), the greater the likelihood of successful outcomes. Certain team

characteristics were found to have a positive impact: years of professional work experience;

frequency of team participation; the type of team training (collaboration; performance

management); and situational entry to team assignments (volunteered, assigned, requested). This

latter point was found to be key - where members self-select and volunteer, teams have been

found to have greater success then where they are allocated or assigned to take part.

For CFTs to succeed it is important that the teams are focused on shared organisational

goals and shared incentives. The integration of cross functional teams has been found to be

negatively affected by goal incongruity, highlighting the need to be aware of differences in

decision criteria and timelines (Parry et al, 2010). This is reinforced by misaligned incentives,

which can lead to the additional problem of free-riding (Rowe, 2004). To counteract such

difficulties appropriate reward and recognition systems need to be designed and implemented

(Mendibil and MacBryde, 2005; Parry et al, 2010). Traditional measures such as performance-

related pay and bonuses have also been found to motivate teams and teams should be awarded

for their efforts as well as for major improvements (Harman et al, 2002).

Within the public sector resource restrictions and the level of scrutiny generally prevents

the use of economic incentives as a means of rewarding performance and the focus appears to be

the achievement of public support (Osborne and Gaebler, 1993). However, according to

Athanasaw (2003), performance management can act as a strong motivator, enabling teams to

5
demonstrate accomplishment of their goals, which can be presented to the public, thus garnering

public respect.

2.3 Resource Allocation

Having sufficient resources to get the job done is critical for CFTs to be successful.

MacIntosh (2003) found CFTs in the public sector face much greater resource restrictions than in

the private sector, even when a strong rationale for further investment exits which may

contribute towards a less successful outcome. Within the private sector, a team’s ability to

perform effectively has been found to be positively related to sufficient resource allocation

(Larson and Gobeli, 1989; McComb et al, 2008), enabling teams to finish their projects on time

and on budget since they are not confronted by delays as they await additional resources.

3.0 PUBLIC AND PRIVATE SECTOR DIFFERENCES

There are of course differences between the public and private sector that require

consideration. For instance, Sundberg and Sandberg (2003) suggest that achieving cultural

change in the public sector is harder than in other sectors as the large bureaucracies inherent to

many public sectors mitigate against any moves towards flatter, looser structures as issues such

as predictability, fairness and continuity are prioritised above innovation and change. In addition,

authority is distributed amongst numerous stakeholders, objectives often change and conflict,

processes frequently involve several departments or agencies and there are restrictions on how

revenue may be generated (MacIntosh, 2003). Changes are subject to a higher level of scrutiny,

require greater participation involving more consultation than in the private sector (MacIntosh,

2003).

In addition, Sundberg and Sandberg (2003) found in the public sector most collaboration

difficulties arise when cross-functional work and processes collide with traditional hierarchical

command and control structures and that this is further compounded by administration struggling

to co-ordinate processes over inter-organisational boundaries. They suggest that any attempts to

6
implement cross-functional working should be implemented as a continuous strategic initiative

as opposed to a radical redesign programme.

Thus, the public sector provides a challenging context for CFT adoption and one that has

not been previously fully examined for the suitability of this approach. The pace and depth of

change that the public sector is currently experiencing, and key role that CFTs increasingly play

in many public sector change approaches, requires that this approach is properly understood and

evaluated. At present CFT adoption has accepted without question - understanding whether this

assumption is valid and also the mechanisms that can support successful adoption, are both key

imperatives.

4.0 RESEARCH METHODS

The purpose of the research is to determine whether a key contemporary operations

management approach (the use of CFTs) can be successfully applied in public sector change

management and the mechanisms that may support any observed success. The paper is deductive

as it relies mainly on existing literature research, whereby the criteria for team success were

coded for, employing the criteria for success as identified by the three key headings in the

literature review (senior management support, cross-functional integration, sufficient resource

allocation). These headings were used as a classification system, however, greater depth and

subtlety emerged than previous research suggested emphasising the importance of the research

project.

Three case studies are presented. Each is built based on a longitudinal investigation of

change in the UK public sector. The study was supported by national government who assisted

in the identification of each case study and in gaining access to research subjects. A three person

research team conducted in-person semi-structured interviews with key informants in each

organisation. Interviews lasted between forty-five minutes and two hours. The research team was

onsite in each council between two and four full days to conduct the interviews. No repeat

7
interviews were conducted, but later interviews built in topics identified by earlier discussions. A

wide range of staff at multiple levels of the organisation were interviewed, clearly triangulating

the results and focused on identifying the use of CFTs and their success. The interview protocol

is shown in table one. This was constructed based on the literature review, themes identified

from past research, drawing heavily on Athanshaw (2003), as well as general topics conceptually

developed by the research team. Each interview was recorded bar one where the respondent

refused. This interview was manually notated by the interviewer. All other interview recordings

were subsequently transcribed. In addition, secondary materials were analysed. This included

meeting agendas, minutes, reports and internal publications such as newsletters and intranet

postings.

We contribute a multi-stage approach, checking for the presence of factors identified by

previous (private sector) research while inductively analysing the unique sub-context of each

case, and comparing across, for new emergent themes. This allowed for contextual validation

checking of previous private sector research and emergent extrapolation of new insights.

[Table One. Interview Protocol ]

5.0 CONTEXT ANALYSIS: TEAM EFFECT

Each organisation was undertaking a major change and restructuring programme prompted by

failures identified by external regulators in key service level (such as education or social

services) and corporate governance systems (i.e. each was identified as a ‘failing’ authority).

Each change programme was undertaken voluntarily but with close oversight from national

government. Within two to four years of starting their individual improvement programmes each

authority had passed service level inspections and was considered to be functioning correctly by

national government. A summary of each case organisation and CFT activity is provided in table

two. The use of CFTs was one of several approaches adopted, in different ways, by each

authority as part of the change process.

8
 [ Insert Table Two ]

5.1 Isolating the Team Effect

In each case team-based working was one of a range of specific change activities that

took place and it is impossible to entirely control out the effect of other variables. In seeking to

isolate the team effect we do find evidence to support the positive role that CFTs play in

organisational improvement. Most clearly this was seen in case C where the VPN was promoted

as the centrepiece of the change programme and recognised by respondents inside the council,

and by external regulators, as the key lever for change. The process of forming the team

supported a change in culture within the council, while the initiatives they implemented

delivered operational improvement.

In both other cases respondents identified projects that existed and subsequently led to

improved performance, solely due to the existence of the team-based approaches. Opening up the

change programme to all staff through team approaches, generated more ideas and gained more

support for the change approach. Overall we are confident in identifying CFTs as successful in

public sector change management programmes and offer positive confirmation for research

question one.

It is important to note that we do not propose that any team will be successful in all

change initiatives - simply forming a team is not sufficient. The support mechanisms put in place

to design and manage the team will be critical. This is most clearly seen in case B where the

early CMT had largely failed to address the changes sought by the organisation. The subsequent

IDT did realise improvements across the organisation, although not as great as either other case.

The changes in context and team design between these initiatives and the other teams examined

here, all help identify the key mechanisms that support CFT-based working. Further, general

evidence gained from each case context based on the reflections of respondents, and comparison

across levels of success and failure between different team structures, support the second stage

findings on the mechanisms that support cross-functional working.

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 6.0 MAKING CFTS SUCCESSFUL

The literature review suggested three main criteria for the support of CFTs: senior

management support, cross-functional working and sufficient resource allocation. While each

section below draws on these three criteria, research found a set of cultural and structural issues

more complex than previously identified. In each case organisation poor performance had

become endemic, resistance to change identified as a major barrier to improvement. Thus, we

provide four key areas of activity that support successful adoption of CFTs in public sector

change: breaking the status quo, leadership support, cultural-structural management and resource

funding (shown in figure one).

[Insert Figure One. Cross-Functional Team Success in Public Sector Change Management]

6.1 Leadership Support

Past research has focused on the need for clear strategies on the part of senior managers

engaged in change programmes (Swink 2003), the need for the support of senior management for

change to happen (Parry et al 2010), and the need for managers ‘sell’ the change programme to

organisational members (Athanashaw 2003). Our findings supported all these aspects of the

management role, however, we also found a more personal or innate set of characteristics were

needed by leaders and also the need for a balance between new people with new ideas being

brought in to lead versus benefiting from those with public sector or organisation specific

experience.

The need for top leadership support clearly emerged in each case study. Despite calls

from senior management, cross-functional approaches are only implemented when there is chief

executive support. At Case A and C the previous chief executives resisted any change for over a

decade, and only when removed from post could improvement begin. The nature of cross-

functional working requires the engagement of all functions of the organisation - only the top

10
leader has the power to look across the organisation and engage all organisational members

behind a cross-functional working strategy.

Successful cross-functional teams not only require leadership support but also leaders

with the skills and drive to achieve staff engagement; gain the support of corporate directors to

release these staff from their duties and take advice from the team and ensure the structural

processes were in place to support the team work. The need for skilled and innovative leaders in

the public sector has been a recurrent theme in the literature (Lyons and Duxbury, 2006; Alonso

and Lewis, 2001) with suggestions that the lower pay and complex working environments

detract individuals able to develop successful improvements.

In Case A and Case B, both appointments were made from the private sector. In both

authorities clashes of public and private sector cultures were apparent - leaders wanting faster

change, sometimes in more prescriptive moulds than the councils were used to. Case C

experienced the most successful change and the most effective leadership - this was an internal

promotion of a person with a long standing public sector working record. The leader displayed

greater cultural sensitivity and an ability to win allies in the council by making a few strategic

appointments and management changes. The need to balance internal and external experiences,

and to develop effective leaders, is beyond the scope of this paper, however, it was clear that the

public sector was capable of generating effective leaders and leadership systems that could

effectively support cross-functional teams.

6.2 Funding and Resources

Research has highlighted the need for cross-functional teams to be properly funded to

support the change agenda they introduce (McComb et al 2008). The public sector has less

funding for change versus the private sector (Saudberg and Sandburg 2003). This topic emerged

during the data analysis process. Two of the three authorities were financially challenged even

by local authority standards. However, in contrast to past research, we found that cross-

functional teams were seen by the authorities not as a cost burden but as a way of directly

11
reducing costs and that relatively small budgets can be used to instigate much larger cash savings

in the long run. This finding is critical in emphasising the importance of cross-functional team

based working to managers in the public sector - highlighting the financial benefits available of

the approach if successfully managed - each team studied here generated cost savings of £100-

900k over a three year period. These benefits may in part be so large due to the poor practices at

work in many public sector organisations. In the private sector the ‘low hanging fruit’ have often

already been attended to such that generating financial improvements from cross-functional

working may actually be harder than in the public sector.

6.3 Structural-Cultural Issues

Previous research identified the need for cultural (or functional) sensitivity in cross-

functional integration projects (Randel and Juadi 2003, Nakata and Im 2010), the need to

integrate disparate cultures with shared goals (Parry et al 2010) as well harder structural issues in

cross-functional integration such as performance management and training (Athanashaw 2003)

and incentive systems (Mendibil and MacBryde 2005) but understanding the subtlety with which

each of these activities is employed together is important and has not been addressed. It is not the

absolute presence of a team or performance system that will make it work but how it is made

operational in the public sector context that determines the level of success observed.

Team Composition and Volunteerism: Two authorities, Case C and Case A put together

teams from groups of volunteers. In seeking volunteers, both authorities initially encountered

apathy and uncertainty from staff who had seen continual change attempts fail but promoting the

value of teams, opportunity to contribute change and initial successes by teams led to a

willingness from more staff to take part. The aim of both authorities in seeking volunteers was to

engage staff in the change process and to break the traditional view that “change was done to

them by the corporate centre” (Case C Deputy Political Leader). This cultural aspect of the

programme is where the greatest success was observed. Each team delivered hard benefits (such

as cost savings or systems improvement) but supporting staff engagement and collaboration was

12
where each authority has seen the greatest benefit. At Case B the IDT, comprised of new

appointments in a separate function, led to systems and programmes improvement, but the

cultural improvements at the other two authorities were not seen.

Both public and private sector organisations are comprised of functionally separated

departments. Breaking down the barriers between these groups is a challenge in public and

private sectors alike.

Team Training and Guidance: Basic meeting and team management skills were provided

(brainstorming and problem solving) over half-day training periods. External agents took on

different roles in guiding the teams. At Case C a non-executive group provided a sounding board

for ideas and the team were broadly allowed to select their own projects. At Case A an

independent audit drove the projects that were selected while at Case B consultants structured

significant amounts of the change programme. The contrasting levels of prescriptiveness led to

differing results. While at Case A and Case B the teams were more focused on achieving

specific goals, at Case C the team able to identify problems and projects in a more open way

engaged with more staff and ultimately created more sustainable solutions.

The need for training in basic skills, as well as the innate characteristics of team members

required for team success are common across both public and private sectors. In the public sector

there is potentially less funding for training available, however, the minimal training necessary

was of such a low cost that any change programme could absorb it.

Frequency of Meeting and Collaboration: Meeting too frequently can prevent any real

progress taking place between meetings whereas meeting too infrequently can lead to drift. At

Case B and Case C the teams met every 4-6 weeks initially then less frequently as projects

progressed, meeting only once up to every 10 weeks. Within the VPN after an initial audit of the

issue took place, the sub-group leader went away to disseminate information into each

department, gain participants, meet with them and then report back into a formal meeting ten or

13
so weeks later. On critical projects, or one where a deadline was approach, the full team could

meet up to once a week as needed.

One issue that arose was the time constraints in finding time when all members of a team

were free from departmental work and on the same site to meet. Some have suggested the need

to physically remove teams from existing departments, in part to allow for communication

(Womack et al 1990). In Case B this approach was taken but the disconnection from the

departments was not beneficial as the IDT lacked engagement with staff from those departments

- one of the core aims of the change programme. At Case C the virtual nature of the team made

this easier - person-to-person meetings were not required every week with regular e-mail and

telephone communications making it easier to share ideas across the team without needing to

meet.

Performance Measurement Systems: Performance measurement systems were clearly

present in each of the case studies authorities. At Case C, measurement systems were put in

place from the start of the team: bi-annual progress reports were submitted to the corporate board

to ensure that changes are taking place. As the group grew a generic protocol for management

reporting was put in place - for every project undertaken, forms identified the aim, leadership,

membership of sub-group, reviewed if the project was on target and referred this progress back

to strategic objectives of VPN itself. This information is compiled into a tracking database for

the political and corporate leadership to ensure that change is progressing. This structure was

valuable for the team to continually focus on the outputs they are working towards.

The need for linking change projects back to strategic objectives on an ongoing basis

through performance measurement systems was a key finding at Case A. As part of the change

programme a clear vision statement for the authority was put in place, a strategy on how to

realise it was developed, and strategic plans for each specific area (such as project management)

were compiled and then devolved to the change team. Each team was thus issued a strategic

objective at the start of the each project.

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 Considering the resourcing of members within the team, some aspects of the literature

suggested that pay rewards for contributing to change projects or cross-functional working were

important. No such incentive was used in any authority and no respondent identified that they

would have sought any such reward. However, implicit in taking part in the team were

assumptions that future career advancement would be supported through showing the willingness

to contribute but this had no direct financial resource implication.

The context of the local authorities in question, each which had historically lacked

systematic performance measurement systems, did not hinder and in fact supported a focus on

ensuring that such systems were developed in the cross-functional teams that were adopted.

6.4 Breaking the Status-Quo: Overcoming Resistance

Even where each of the three areas above are usefully put into place, CFTs exist in the

broader context of the organisation. In each of the three cases the need to overcome resistance

(born of frustration as well as outright opposition) to change from multiple sources became

evident in the data gathering and analysis. Three separate types of resistance were identified:

staff, management and political resistance. Overcoming all three was necessary for success of the

general change programme and cross-functional team. Past research has not specifically

examined resistance to cross-functional integration in this manner or applied such a lens to the

public sector where distinct political grouping emerges in addition to the staff and manager

groups seen in the private sector.

Staff Change: At the start of the change process each authority had cultural problems -

high absenteeism, high staff turnover and problems in recruiting staff to fill vacancies. Staff in

each authority were disillusioned with a working environment that was top-down and restrictive,

did not value them and offered no career development opportunity. Faced with such a situation

any change is problematic - introducing cross-functional teams - which depend on staff input for

success is even harder.

15
 The changes in leadership and the introduction of change programmes helped to soften

staff antipathy prior to the introduction of cross-functional teams. The Chief Executive at Case C

described the staff situation at the start of the change process as “not real resistance but

frustration at another change programme after so many efforts had failed in the past”.

To realise the benefits of cross-functional teams, staff from across the organisation need

to take part in the team itself: “You need people to be up for change and who recognise there is a

better way of doing things” (Case C Deputy Leader). The cultural problems in each authority

made this a difficult task. In each authority, the senior leadership embarked on a broad

programme to engage staff.

As the Director of Corporate Centre, Case A emphasised: “We always recognised change

would be difficult and there wouldn’t be a revolution overnight… a lot of the programme was

about winning the hearts and minds of the staff”. At Case A and Case B, the new chief executive

and directors promoted the team to staff in the authority. The need to ‘sell’ the change teams to

staff was a recurrent message. Activities included: going out to meet staff through road-shows,

open meetings, and employing staff communication channels (such as staff magazines). At Case

C, the new chief executive and political leadership played leading roles in promoting the VPN -

they led the formation, attended meetings, and engaged directors of departments to ensure staff

who volunteered would be released from their normal duties to take part in VPN meetings and

change initiatives.

At Case A, the change team manager described a tipping point of 60% enabling a critical

mass of support that allowed them to accelerate change. At Case C from initial scepticism the

VPN is now over-subscribed with people wanting to take part in the process.

Being able to demonstrate real and successful improvements as a result of the change

teams’ formation was critical in helping to win support - they quickly came to see CFTs were not

another empty change tool but delivering real benefits. In each authority, the change teams

16
served a dual purpose - enacting change and through that change engendering a broader change

in the culture of the organisation.

Management Change: Ensuring senior staff were onboard with the introduction of the

teams was vital to success, without the support of each function within the organisation the team

cannot draw on expertise from across the organisation or implement changes. Each case study

reported that cross-functional working was only possible after new staff had been introduced at

the top of the organisation (usually the chief executive, deputy chief executive and majority of

the corporate directors). At Case C, the interviewees all reported that under the previous

corporate directors cross-functional teams or the VPN would have been impossible as they

would not have ‘let go of the reins’ so the team could investigate problems and recommend

changes.

Ongoing resistance was present in Case A and Case B from senior staff and was dealt

with in different ways. While great effort was made to win over all in the authority, all changes

were not always positively supported. As noted above, only with the right senior management

team will cross-functional teams be successful. This may require the problematic task of

replacement of some senior staff. In the authorities here, this process was already taking place as

part of the change process; new staff were selected based on their support for the change process.

Despite some senior level appointments (usually at the director level), there was no large

scale staff change - five or six key changes at the top of each authority took place, with mid-level

managers predominantly remaining in post. This middle group, like the staff population as a

whole were sceptical about the reality of whether cross-functional teams and change as a whole

would make a difference. Many were won over by the cultural efforts of the senior management

team and the evidence of changes taking place, however, some still presented objections to

changing working patterns and practices. In Case A the forty or so middle managers were

brought together into a new leadership group to meet, share their ideas and speak about the

programme to galvanise support. The team manager at Case B describes the need for the team ‘to

17
identify the awkward squad’ - those that resist change. He described the need to try and ‘sell’ to

them the need to change and benefits to them from cross-functional working but also the need

for the leaders of the organisation to offer a ‘stick’ to negate their objections by forcing

compliance, or ultimately their reassignment.

Political Change: In local authorities an added area of resistance may come from the

political side of the council. Political issues affected the broader change programmes at work but

not the actual cross-functional teams. Politicians are not bound to specific organisational

functions so hold no allegiance to them. Working in different functional areas throughout their

political careers politicians actually have a greater awareness of the connections between distinct

functions than corporate managers who tend to specialise within a single area. In Case C, the

political deputy-leader was one of the people to initiate the VPN to pursue change. Equally in

Case A, the hung-council saw Labour and Independent leaders working co-operatively to support

change and the change team. In Case A certain large change projects were however opposed for

political reasons. These projects tended to be beyond the scope of the team (for instance,

spending on schools versus roads).

At Case B uncertainty as to the future political composition of the council (and potential

for a change in ruling party) was creating uncertainty at all levels of the change process. These

were focused at the absolute level on whether a new party would continue to support the

initiatives or seek to end all change teams. This uncertainty was fuelling an uncomfortable

working environment for the IDT and management teams. The potential for changes in the

economic environment in the private sector draw parallels - faced with a potential reduction in

sales, those taking part in change programmes often experience similar fears for the future.

While the context is different, the difficulties experienced in this regard are common across

public and private sectors.

The evidence of poor performance provided by the external audit bodies helped break the

internal culture from denial into an acceptance of the need to change, as well as greater freedom

18
this provided the organisation to select new senior leadership teams, adding to the likelihood that

new practices could be successfully adopted. Without this nasty tasting medicine at the outset, it

may have taken longer to engage the authority in the need to change and engage with the cross-

functional teams.

7.0 CONCLUSION

In this paper we have investigated a series of CFTs in three case study contexts of the

public sector and have found broad support for the use of CFTs in public sector change

management programmes if and only if the necessary support mechanisms are put in place.

We build on the existing literature and support the three key support mechanisms that

have been previously identified (senior management support, cross-functional integration and

resources), however, we significantly extend each area and adapt it for the public sector context,

finding greater subtlety in the application of issue than has been suggested in the past. We find

the innate characteristics of the leader more important than absolute management support; we

identify a specific set of structural and cultural activities that have not previously been brought

together under the general heading of cross-functional working; and, we find that resource

scarcity is not necessarily a barrier to cross-functional working as such an approach may free

resources in the long term.

Critical to each team was a focused approach to overcoming resistance and breaking free

from the status quo, with issues at the staff, management and political levels all requiring

attention. Resistance to change has been discussed previously in the change management

literature, however, few writings on CFTs have specifically attested to the relevance of this area

(which we find overwhelming). A study of resistance to cross-functional working in the public

sector is largely absent from the extant literature despite this issue being highly important in our

study.

19
 Underlining the research was a need to align the key aspects that support CFTs together

across the organisation – only when aligned together does the optimal outcome emerge. We have

combined these together in figure one to provide a model for understanding the process of

support needed to aid CFTs in the public sector.

More empirical research needs to be conducted that investigates team-based working

practices in the public sector, and in organisations beyond the local authority context such as the

health care sector, defence and education. This paper has identified several areas that require

further research, most notably: What are the roles of leaders in driving through major change

programmes in the public sector? Are the skills and experience required in the public sector the

same as those required in the private sector? Can change programmes be supported when

confronted with entrenched resistance? In investigating the differences between public and

private sector requirements, interviews could be conducted with managers that have worked in

both the public and private sector or with interims/consultants that have worked with both

sectors. Based on past research we have built on the accepted premise that cross-functional

integration and team based working are always beneficial to the organisation, however, CFTs do

run a risk of pulling too many people out-of-function, creating confusing dual-reporting systems

and diluting expertise. As with any improvement approach negatives can occur when the activity

is done poorly (see for instance Womack et al 1990 discussion of real versus artificial CFT in

new car design), however, extant research continues to emphasise the need for more integration

across organisations and CFT as a beneficial tool to achieve this.

For policy makers we support the current drive toward more integrative working across

the public sector and provide a practical set of activities to aid the process of implementing

cross-functional working. Theoretically we provide a contextual extension of cross functional

working and team based models of behaviour into the public sector. Overall, we conclude that

CFT working if properly supported (through a careful consideration of the public versus private

sector context) can deliver positive results as part of public sector change programmes.

20
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 Figure One. Cross-Functional Team Success in Public Sector Change Management

Leadership
Support

Cross-Functional
Structural-Cultural Over-Coming
Team Success in
Support Resistance
Change Management

Resource Funding

Table One. Interview Protocol

Topics and Questions:
Background:
Can you clarify your job/role at the time of the start of the change programme? Can you outline the general
duties or principles activities this involved?
Context:
How would you describe the composition of the local council?
- economic, social, political, financial
Before the change programme, could you describe the sort of place the council to work in?
- Did this change after the change programme?
Change Programme:
The council has undergone a period of major change.
- What were the key trigger mechanisms that led to these changes?
- Could you describe the change programmes that took place please?
- What was your role in these programmes?
- What role did cross-functional based approaches, such as team working, play in the change programmes?
- What role did you play personally in cross-functional working approaches?
Team Based Working:
Can you describe how the team operates please:
- How are member brought into a team?
- Are there enough people to support team based working?
- Is there any training or support for team members?
- How are change priorities identified?
- How are programmes for change identified and then done?
- What financial resources support the team?
- How is the performance of the team measured or monitored?
- What have been the key achievements of the team?
- What activities do the teams currently have in progress?
- What has been the role of the chief executive and senior management team in the change programme and team?
Resistance:
Has there been any resistance to change or team based working in the authority?
- How have managers and staff reacted to the team?
- How have managers and staff reacted to the changes being made?
- Have there been any political issues that affected the teams operation?
General Reflections:
If you were initiating a change programme would you seek to use cross-functional team approaches?
- If yes, is there anything you would do differently?
Not all respondents answered each question in turn, many addressed sub-issues when asked the first general
question.

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 Table Two. Case Description.

Economic Departments/ Key Failures General Change Initiatives Cross-Functional Team Interviews
Condition Functions Activities
Case A High deprivation - Integrated - Bad inspections in social - New Chief Executive - Six CFTs to address projects - Director of Corporate Centre
Budget: Shrinking Children’s Service; service ad education. (external appointment) within a transformation plan - Deputy-Chief Executive
£75m population - Adults, Families, - Identified problems in - New corporate directors - Open call for volunteers - Political leader
Population: Learning management systems to - ‘Team Council’ broad - Freedom to enact small/low - Opposition Leader
50,000 - Community extent labelled ‘a failing cultural engagement project cost change - Head of Improvement
Customers Services authority’ with ‘no capacity - Detailed audit of failing areas - Larger changes referred to Planning
- Corporate to improve’; silo-mentality, and change plans devised corporate board for approval
Customer Services little interaction across - new HR policy, performance
departments management system and
strategic vision
Case B Large, - Social Services - Bad inspections in social - New Chief Executive - Change Management Team - Operations management
Budget: prosperous area; - Finance ICT and services (external appointment) (CMT) chaired by corporate - Community service manager
£310m generally well off Property - External audit revealing - Change Management Team directors with senior staff only - Finance Director
Population: population with - Environmental and poor corporate governance - and Improvement taking part - Change team leader
124,000 some areas of Economic disillusioned staff, high Development Team formed - CMT replaced with - Change team coordinator
moderate Regeneration turnover, problems in - New policy team Improvement Development - Chief Executive
economic - Learning and recruitment, silo mentality, - ‘One-Council’ broad cultural Team (IDT)
deprivation Development little evidence of engagement project - IDT - five new appointments
- Legal, Public collaborative working comprised team
Protection and - Notable achievement – new
Housing Services central records already gained
£1mil cost saving
Case C Moderately - Education - Bad inspections in social - New Chief Executive - Virtual Policy Network - Political leader
Budget: economically - Environment service and education. (internal promotion) (VPN) - Deputy Political leader
£170m deprived, stable - Governance - Identified problems in - New corporate directors in - ten fixed members from - Corporate Governance
Population: population - Resources corporate governance: poor social service and education existing staff, each leading one Director
70,000 - Social Services communication, low staff - New non-executive board to project per year and forming - Chief Executive
engagement, high staff support change at policy level sub-teams of volunteers - Social Service Director
turnover, silo-mentality, - Cross-functional team to - Notable achievements - - Environment Director
hierarchical top-down support change £300,000 savings from - Finance Director
culture, minimal interaction reviewing legal claims - Education Director
across functions. handling; - Change team leader
- Change team manager

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