What’s different about this wave of restructuring

We are continuing to see a wave of organisational change where clients are asking us to build the skills needed to succeed in a more matrixed environment. People are increasingly working horizontally across their organisations, in multiple team environments with multiple stakeholders and often multiple bosses. Whether you call it matrixed, integrated, global, networked or a “one Company” initiative, the skills are similar.

There is a combination of pent up organisational change that companies didn’t want to proceed with during COVID, plus restructuring to try and recover from the impact of the pandemic.

After the financial crash in 2008/9 we saw a similar pattern. However at that time the intent was almost universally to introduce the matrix to become more centralised, more global, to take out cost and uncover synergies.

This time there seems to be more of a focus on maintaining the right balance between creating synergies across the business and enabling flexibility within the business.

There is nothing about a matrix that requires centralization; though they sometimes go together and the matrix gets the blame. In fact the matrix is multi-dimensional by definition – we have to take into account both the horizontal and the vertical, the business unit, the geography and the function. If we centralise along any one of these axes we tend to reduce the flexibility at the point of intersection.

If anyone of these axes achieves dominance the the matrix tends to be less effective.

A number of our clients noticed that, after explicitly setting up a matrix to become more integrated and more global, they felt they had become less agile and flexible to local needs. in a sense that’s exactly what they set out to achieve, they created a change in the power balance towards the global and central structures.

There is no such thing as a free lunch in introducing a new structure, strategy or way of working, we take some benefits and we pay a price.

With remote working during the pandemic, we saw increases in productivity, engagement and autonomy, and people are keen to hold on to these benefits. But there are still concerns about maintaining relationships and culture and this is more difficult in that environment, but certainly not impossible.

There will never be an organisational structure or way of working that is consequence free. Hybrid working could give us something approaching the best of both but will still have it’s disadvantages, it will be both logistically and cognitively complex to switch modes regularly, meetings will be more difficult and we will require different skills to make it work.

It’s the same with the matrix, we often introduce the matrix explicitly to improve collaboration and communication across the silos and then we are surprised when the number of meetings increases and decisions can take longer because more people are involved.

When we make any change like this we need to capitalise on the advantages but then we need to put in place measures to cope with the disadvantages.

If a matrix leads to an increase in meetings, then at the same time we need to be more selective about who we invite to our meetings and how we run them. If hybrid working brings the risk of proximity bias then we need to change our company processes to improve the way we make people visible across the organisation and to equalise the remote and physically present employee experience.

We can’t expect any change to resolve all of our problems just by redrawing an organisation chart or announcing a new flexible working policy. We need to change our culture and ways of working to make this new arrangement work.

The big trick in the matrix right now is how to be both more integrated and connected and more flexible and responsive at the same time. We will come back to this theme in later blogs.