Finance thinks that marketing is wasting the budget. Sales won’t talk to engineering. Purchasing believes that the IT department is slacking. It is common wisdom in management science and practice that when teams and departments turn into ‘silos’ they waste resources, kill productivity and jeopardize the achievement of goals. But how to get interdependent teams to work together effectively?

Coordination through structure, strategic goals or middle managers?

We know that coordination matters. A study of over 250 companies found that teams are three times more likely to miss performance commitments because of coordination breakdowns with other teams than because of coordination issues within their own team. Yet ironically, suggestions from books and articles on coordinating the collaboration between teams can be found within separate, siloed literatures. The suggested coordination mechanisms are: (1) relying on the formal hierarchical structure, (2) having middle managers span the boundaries between teams to ‘bust silos,’ and (3) creating a shared understanding of common strategic goals.

So, which coordination mechanism should companies choose to get interdependent teams to work together effectively? Rely on structure, strategic goals or on middle managers? This question is especially pressing as an increasing number of organizations is eradicating middle management ranks and strategy scholars are debating the extent to which middle managers add value.

When and How do these coordination mechanisms work together?

In our study, published in the Journal of Management Studies, we took an integrative perspective. Rather than looking at these three coordination mechanisms in isolation, we wanted to understand when and how they work together.

We theorized that organizational structure can be a valuable coordination mechanism. In fact, in agreement with those that question the need for middle managers, we argue that when teams are part of the same division, this structural coordination is a sufficient means to foster collaboration between teams. Being part of the same division ensures both the sharing of local knowledge and perspectives, as well as shared understanding of local objectives. Here, middle manager boundary spanning and shared understanding of strategic goals do not add value.

However, there are many instances where teams do not share division membership and still very much need to collaborate. Then, we argue, a shared understanding of strategic goals and boundary spanning by middle managers come into play because they can substitute for structural coordination.

In fact, in agreement with those that champion the need for middle managers, we argue that middle managers’ boundary spanning is a critical coordination mechanism for teams from different divisions. Here middle managers can ensure that both local and distal knowledge and perspectives are shared. Moreover, they can negotiate potentially conflicting interests and manage interactions across division boundaries in aid of collaboration between teams.

Furthermore, we argue that shared understanding of strategic goals can also substitute for structural coordination because it offers common ground, facilitates communication and ensures that teams work together in line with the organization’s strategy. Lastly, we argue that middle manager boundary spanning strengthens the positive influence of a shared understanding of strategic goals; the active engagement of middle managers in ‘busting the silos’ between teams can help translate an understanding of shared distal, strategic objectives into collaborative action.

So, do companies need middle managers?

To put our thinking to the test and get a thorough understanding, we collected data from a large service organization from Western Europe. Using their organizational chart, we mapped out the formal hierarchical structure. In addition, we not only surveyed all middle managers about their boundary spanning activities, we also surveyed all their employees to determine the shared understanding of strategic goals, as well as all supervisors to determine how effectively different interdependent teams were working together. In total, we examined almost 200 different collaborations between teams.

Our results confirm our theorizing. They show that –No– to ensure teams from the same division work together effectively, there is no added value from middle managers’ boundary spanning. However, our results also show that –Yes– to ensure teams from different divisions work together effectively, middle managers’ boundary spanning is an important coordination mechanism that improves collaboration. Additionally, our results confirm that middle managers’ boundary spanning further strengthens the positive influence of shared understanding of strategic goals in aiding teams to work together effectively.

What does this mean for companies and managers?

The implications of this research are relevant, first, to companies and managers who want to ensure their teams work together effectively. With the knowledge that middle managers’ boundary spanning is most critical for teams from different divisions, organizations can ensure their boundary spanning training not only develops managers’ understanding of how to engage in boundary spanning, but also of when to do so. This is helpful to middle managers not only because boundary spanning is a taxing activity, but also because these managers have multiple strategic roles that require attention. To make such boundary spanning efforts even more effective, organizations would ideally also invest in building a shared understanding of strategic goals.

Second, this research is relevant to scholars and practitioners who question the need for middle managers, especially to companies that consider boundaryless organizational structures and eradicating middle manager ranks. Our findings suggest that eradicating middle managers may be especially harmful to boundaryless organizations. Since boundaryless organizations offer very limited possibility for structural coordination, they greatly increase the need for both middle manager boundary spanning and shared strategic goals as substituting coordination mechanisms. Indeed, former boundaryless companies like Google and Github have (re-)introduced middle managers and Google now even identifies ‘collaboration with other teams’ as one of the critical skills for their managers.