Building Cross-Functional Agility for Operational Resilience

Private Equity

Jeff Bartel

Chairman and Managing Director

The array of challenges organizations faced during and after the pandemic made it clear that operational resilience is crucial to business success. For example, studies now show that 60% of companies temporarily shut their doors during the pandemic are permanently closed. The inability of these organizations to adjust to challenges, such as remote work, quarantines, supply chain disruptions, and labor shortages, left them unable to recover.

Successful businesses understand that remaining operationally resilient requires building cross-functional agility throughout the organization. This blog closely examines cross-functional agility and how to assemble a team that maintains business resilience.

Building Operational Resilience

Businesses across the globe are looking for new and innovative ways to overcome many new and ongoing challenges, such as supply chain disruptions and labor shortages. Organizations must prepare for current and future challenges by building an operational resilience framework. For example:

Optimizing Global Supply Chains and Assets

Overcoming today’s global supply chain disruptions will take more than building new networks. It requires new work models that utilize real-time data insights and automated workflow processes—knowing what and where inventory and supplies are needed allows your organization to put your goods or services into consumers’ hands as quickly as possible.

The supply chain is a complex process that encompasses multiple departments, including sales, warehousing, and transportation. Therefore, to optimize the supply chain process for operational resilience, you need cross-functional cooperation that covers every stage of the process, including:

  • Inbound: Today’s supply chain disruptions often start at the border, with bottlenecks occurring at ports worldwide. Some companies are utilizing regional suppliers to avoid these issues, but for many other organizations, international suppliers are a critical source of raw materials.
  • Middle Mile: Between the labor shortage causing late deliveries and capacity restraints and increased fuel costs driving up delivery fees, moving materials from the supplier to the warehouse or factory has become more costly and cumbersome. Businesses must know what supplies they need and where these supplies go.
  • Warehousing: To deal with supply shortages, some companies increase their storage of goods and raw materials. Since finding available storage space can be difficult, time-consuming, and costly, organizations must know what’s in stock and accurately predict future demand to minimize storage needs with accuracy.
  • Last Mile: Traditionally, the final mile involved transporting finished goods to various retailers. Due to increased e-commerce demand, companies are looking to bypass retailers and deliver directly to consumers. Organizations must be able to manage a complex logistics process to accomplish this.

Digitizing for Operational Resilience

Companies hoping to remain competitive in the years to come must invest in innovative technology and digital tools for operational resilience. Adequate tools allow companies to use real-time data to build, analyze and adjust business processes and improve efficiency. You should take several steps to transform digital operations for operational resilience.

Set goals and objectives: As with all business processes, the first step is to set clear goals and objectives. Determine what real-time data you want to collect, what insights you want to obtain, and what the project’s end goal is.

Determine scope: While you do not need to digitize all company files and documents at once, you need to determine the scope of this transformation. Identify precisely what types of information your company wants to digitize first.

Complete frequent audits: The needs of your company shift from year to year, month to month, and even week to week. Therefore, it is crucial to frequently audit your digital processes to ensure they meet the company’s needs.

File storage: You also need to think about how you want to store files. For instance, do you want everything to be in digital form, or do you want to maintain physical documents as well?

Cloud storage: Cyber resilience is vital in improving cross-collaboration. Consider using cloud storage to maintain your records.

Building Cross-Functional Agility in Operations

Two business advisors building cross-functional processes for operations.

Building cross-functional processes allow for seamless communication and collaboration between departments that help build operational resilience. When these teams are no longer limited to the scope of their respective tasks, that improves agility in operations and the company’s ability to remain resilient despite ongoing challenges. This agility comes from the company’s ability to maintain resilience management and allows the organization to:

  • Anticipate the company’s future needs.
  • Develop business plans to meet both current and future challenges.
  • Quickly respond and communicate with all key players within the company.
  • Adapt to shifts in the markets and workplace.
  • Learn from mistakes made to ensure improved future outcomes.

Cross-Functional, Agile Teams Effectiveness

Even with the effects of COVID-19 starting to subside, businesses are still facing multiple issues, including rising costs, supply chain challenges, shifts in customer expectations, and frequent changes in consumer demands. As a result, every business must work as a team and not as independent departments to overcome current and future challenges.

In many cases, organizational silos, where each department takes care of its tasks, can hinder rather than build resilience. Rather than teams working individually, which can interfere with communication and coordination, organizations need the agility only cross-functional collaboration can provide.

The good news is that cross-functional, agile teams can deliver various benefits, including

  • Enhanced organizational communication.
  • Improved efficiency of business processes and workplace practices.
  • Faster implementation of new technologies, processes, and policies.
  • Ability to scale business production up and down, as necessary.

Strategic Advisors to Build Operational Resilience

Organizations must maintain operational resilience because of today’s fast-paced market, shifting consumer demands, supply chain disruptions, and numerous other challenges. The good news is that developing cross-functional collaboration throughout the workplace can help your company build this resilience and remain competitive for years to come.

Does your organization lack operational resilience? If so, this lack of agility could hinder your ability to stay competitive in the years to come.

To learn more about how to build operational resilience, schedule a time to talk to one of Hamptons Group’s strategic advisors today.