Nortel CTO John Roese wrote a blog post about the decision to give the business units more autonomy, focussing on the speed benefits of the new structure and abandonig the previous matrix structure
“By having discrete business units and eliminating a complex matrix organization that we have historically operated within, the individual BU’s can make quicker decisions, optimize their processes and structures, make strategic partnerships, and adjust technology and market strategy far faster than before… As Nortel transforms into this BU formation, we will be a company that has discrete and fully integrated focus on the enterprise evolved market and the next-generation carrier market. Each of those BU’s will be lean, focused and autonomous and with that posture will have an increased capability to make rapid decisions and execute in their markets.”
It will be interesting to see the relative effectiveness of the vertical focus over he matrix structure in the current tough economic conditions.
Is the matrix structure helping or hindering in your organization? Are the benefits of lateral cooperation and sharing of resources across the organization worth the costs? Is the matrix an easy scapegoat for other problems? What do you think?