For any organization and a CEO, top team alignment is the most critical aspect that aids effective leadership. However, it is also the most difficult to achieve.
Leadership at different levels is different from aggregate leadership and this is where the difference lies. There is a difference between reporting groups and real teams – reporting groups could be a set of people who report to the same leader, whereas a real team is a mechanism for a CEO to run the business — it is an extension of the CEO and functions collectively to take decisions that a CEO would take. Almost everyone in the top teams have two jobs – their functional jobs (as a department/function head) and their job as a component of the top team. Being a part of the top team is where an individual puts on the business hat, where he/she, collectively with others becomes the CEO and thinks like a CEO. But this is where the difficulty occurs. People find it difficult to break out silos and to reconcile with conflicting agendas when it comes to their departments and the business as a whole. Most of the times, individual leaders also find it difficult to question in an open forum.
The main challenge, however, that is encountered with the top teams is of behavior — it is a behavioral challenge. The top team members need to be mature enough as leaders to make the tradeoff between their own functions and looking at the big picture that is the business as a whole. But with everyone in the top team having two roles – at times, individuals are unable to make that shift or transition from being a functional leader to a business leader. When one is in a functional role, one is bound to make certain decisions; but when one is in the top team, as a member one is responsible for the collective decision making – and this is related to integrity, which is a crucial aspect.
Organizations that are successful and have outstanding teams have a metric for incentivizing its people – they build interdependence in the participants of the top team and structurally incentivize them to work together.
Cross functional alignment is about long-term vision, identifying the initiatives and key projects that are essential to achieve the vision. A CEO needs to create an environment where conflict is raised and made a good thing. It is not about working individually but collectively as a team. The overall goal should be a shared accountability and individuals need to function within that.