Question

You are the owner and President of Pandatopia, Inc. (PI), a company that produces and sells inexpensive outdoor clothing. Your main concern has always been keeping costs down while achieving an acceptable level of quality and durability. There is a lot of innovation in the clothing industry, with industry leaders constantly trying to develop new materials and clothing designs. This has not been true of PI, however. You have preferred to “keep it simple” by continuing to offer the same basic and cheap products.

After analyzing the company’s external environment, you conclude that PI’s strategy will not be feasible much longer. You have read about the large environmental impacts of the clothing industry[1] and decide that PI can be successful if it “goes green”, i.e., distinguishes itself by offering clothing that has been produced in an environmentally friendly way. You establish a new mission statement, which states: “We’re in the clothing business to save the planet.” You plan to make clothes that last for a long time, repair customers’ clothes for free (even clothes they didn’t purchase from PI), use only suppliers that produce their materials in an environmentally friendly way, give funding to environmental groups, and have fun by constantly trying to come up with new process and product innovations.[2]

The steps in clothing manufacturing include the following:

Clothing design – Purchasing of materials and dyes – Production – Distribution to retail stores – Sales to customers – Customer service and returns.

The head of the Purchasing Department, Polly Propaleen, is considering establishing a cross-functional team and asks for your advice. Do you think this is a good idea? Why or why not? If Ms. Propaleen did establish it, whom should she put on the team?

Answer 1

Establishing a cross-functional team is a good idea and can be projected as the primary structure of Pandatopia. The main idea of establishing a cross-functional team is to arrive at the solution in a rapid manner instead of going through several departments. Consider the case of a customer calling the customer service and complaining, the customer service representative understands the problem and identifies the respective department that could handle the complaint and transfers the call to the particular department. The customer waits on the phone and starts to explain the problem to the department personnel right from the beginning. After hearing the customer problem, the department representative blames the other department and transfers the customer call to that department. The customer waits for a solution to the problem for several minutes or even an hour in some cases resulting in the customer getting frustrated and leaving the company. Establishing a cross-functional team helps to address such customer problems rapidly within minutes in a single phone call at the customer service desk itself as all the departments are integrated. This makes the customer get the solution rapidly and the chance of the customer becoming loyal are high as a result of establishing a cross-functional team

The main aim of establishing a cross-functional team is to put the customer first by enabling effective communication among the various departments to arrive at the solution in a rapid manner. The cross-functional team enhances collaboration among the various departments in the organization to optimize organization resources (time, cost and effort) leading to increased product and process innovation reduced cycle time and improves customer satisfaction levels considerably. Ms Propaleen should include members from clothing design, purchase, production, distribution, sales, customer service and returns department in the cross-functional team. Hence it is recommended to establish a cross-functional team at Pandatopia