Management by objectives can distort a matrix organization

I have been working with one of our clients on matrix management training for people stepping up to executive level. This is the point in their organization where managers step up from mainly local and functional roles and start to take on a wider, cross-organization profile and responsibilities – as a  result they become much more exposed to the matrix.

This organization is very successful and highly driven by its objective and measurement driven people evaluation processes. Objectives and measures are tightly linked to reward and career progression. However, in a  matrix, this linear and individualistic set of measures starts to get in the way.

The essence of a matrix is that objectives compete and often conflict. To be successful this structure requires that we manage dilemmas, trade-offs and reconciliations. If two individuals are involved in this and have competing sets of measures and objectives, they may only be able to achieve the right result for the organization if they agree not to maximise their individual measures – and this might count against their pay and promotion prospects.

So very clear, linear management by objectives and pay for performance systems may prevent a matrix from operating effectively, or at least mean that we rely on people to act against their own best interests to make it work.

Have you seen this in your matrix organization?