Matrix Management

What have you got against matrix management?

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The term “matrix management” and the idea of a matrix organization, generally gets a bad press. If you search online you will see lots of examples and articles about the disadvantages of the matrix. The sentiment on Twitter is similar, pretty negative.

So why is it that the vast majority of the world’s most successful companies use this organization form?

In our own research we found that over 90% of FTSE and Fortune 50 companies operated some form of matrix structure, the only ones that didn’t were either purely national companies or simple organizations such as commodity exporters.

Basically, if you have any form of globally integrated operation you probably have some form of matrix.

The matrix is a simple reflection that business is complex. We have to balance multiple dimensions, all of which are important; the function, the business unit, the geography and sometimes other factors such as technology or product group.

If you look at the executive leadership of any large international company – once you see people with geographic responsibilities, functional responsibilities and some other business unit type responsibility then you probably have a matrix at some level within the organization.

Despite this, we observe that when people implement a matrix they often get a push back, an almost automatic assumption that matrix is difficult and bad. Some of this seems to date back to a number of academic reports and other reference pieces studying the impact the matrix in the 1970s and 1980s when a number of early matrix implementations failed – largely because of the absence of the information and communication technology required to make a more integrated way of working successful.

Is just not true that the matrix doesn’t work. Hundreds of the world’s leading companies operate the structure successfully. It is different and it does require a different skill set, and way of working, but the world’s leading companies are making it work successfully.

I was talking to some managers from one of our clients the other week about this, and I suggested that, if the word ‘matrix’ was an issue, then why not use different words?

They asked what I would recommend and I told them that we were now talking about the “globally integrated organization”. For some reason this sounds more aspirational and positive – even if it ends up being pretty much the same thing as the matrix. My clients view was that they would have had much less resistance if they called their initiative the ‘globally integrated organization’.

If changing the words helps, I would recommend you try it. It seems hard to change people’s views of the matrix once a negative view is entrenched, even if it’s wrong.

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