Simplifying your matrix organization structure: step one

Step one to simplifying your matrix organization structure – limit matrix management to where it really adds value

Part two of our simplifying your matrix organization structure series.

In Speed Lead®, I wrote about three distinct groups within any large, complex organization.

  1. The global group – the small number of leaders at the very top of the organization who head up major business units, regions and functions. These individuals tend to report directly to the CEO. They do not have multiple reporting lines above them. These are the people who should consistently take a global view of issues. Even in the most international organizations they will be less than 5% of the total population.
  2.  The locally loyal – the people who have purely or very largely local jobs. These are the people who work in factories, shops, offices and service centres. Even in highly integrated global organizations, these people are the vast majority of our employees – typically 85% or more of our people. These are jobs where the matrix really has little relevance and only introduces complexity. These people may work as part of global systems or share information with colleagues in other cultures, functions and locations, but co-ordination of their work can be achieved through shared workflow or systems, or even virtual teamwork, and doesn’t require the complexity of multiple bosses.
  3.  The matrixed middle, the leaders in the centre of the organization who bridge the gap between the global group and the locally loyal. Typically, no more than 10% to 15% of your employees, this group are critical to the success of your matrix.

This is great news! Many organizations come to us (Global Integration) thinking they have a problem that affects the whole organization and quickly learn that it’s a much smaller issue than they feared. It is a valuable realization that 85% or more of your people can and should be insulated from the matrix.

Here is an example from a company I used to work in. The structure is relatively flat but not particularly unusual. The organization worked off a typical ‘span of control’ of eight people.

The structure looked like this.

  • 1 CEO.
  • 10 global, function and business unit heads (not matrixed all reporting directly to the CEO)
  • 80 divisional heads – matrixed
  • 640 departmental heads – matrixed
  • 5,000 first line managers – some matrixed
  • 41,000 non-management employees – not matrixed

If you can limit the matrix to the divisional and departmental heads only then only 1.5% of your employees need to be matrixed. If you include all first line managers, this increases to 12% of your employees.

Matrix management is a significant step up in complexity in the way we lead people and work with colleagues. Multiple bosses, competing goals and higher levels of ambiguity mean that a matrix managers require a high level of skills and capabilities that can take time to acquire.

By limiting matrix management to the ‘matrixed middle’ group, we can constrain the impact of this complexity of the organization as a whole and in particular keep it simple for operational people.

It also makes it a more manageable population in most organizations when we focus on matrix management training and skills development.

Why not…?

Have you had experience of a matrix going too far into an organization? How was it? We’d love to hear your experiences.

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