Reaping the Rewards of Cross-functional Teams: Why Processes make a difference to Team Performance

Cross-functional teams are often advocated as the key to achieving excellence within organizations. However, research suggests that while they promise much, they don’t always deliver. Drawing on social identity theory, we argue that cross-functional teams create conditions for differing role expectations and the emergence of role conflict is an important mechanism that helps explain why cross-functional teams don’t always deliver better team outcomes. We also propose that the emergence of role conflict is contingent on team processes. Drawing on data from multiple sources and 75 teams, we find that in cross-functional teams, interpersonal conflict management helps reduce role conflict and that role conflict is an important mechanism that explains the relationship between cross-functional teams and team performance. These results provide evidence for the benefits of investing in interpersonal conflict processes in cross-functional teams.