A power 'Grid' is a network that carries electricity from power plants to consumer premises. The grid is made 'smart' as it can monitor and control the distribution system by taking intelligent decisions. Smart Grid is an automated and broadly distributed energy generation, transmission and distribution network. Smart Grid network integrates an electrical distribution system with information and communication network. Communication network protocols are engineered, developed and established based on the layered approach. Each layer is designed to serve a specific functionality in collaboration with other layers. Layered approach for wired communication approach can be modified with cross layer approach for wireless communication for performance enhancement. Smart grid technology comprises of hierarchical and heterogeneous network with diverse set of communication protocols. This demands a divergence from primitive approach and adaptation of an innovative approach. This paper describes network design and optimization of routing protocol for Smart grid Neighborhood Area Network using Riverbed-OPNET software. A Cross layer approach is considered in parameter optimization of IEEE 802.11 standard. The proposed work shows parameter optimization of routing protocol for better network performance using simulation approach.