Challenges and Strategies of Matrix Organization

By

Thomos Sy. College of Business Administration California State University

Laura Sue D’Annumzio, A.T. kearney Inc

INTRO

Interest in Matrix Org reaches its peak during 1970’s to 1980’s Adopt as viable alternative to deal with complex business in

aerospace, automobile, banking, chemical, communication, computer, defense, electronics, financial energy.

Need for information on challenges and best practices. Focus on human side(managing and operations) instead its

structure, as its results may b actionable

OVERVIEW OF MATRIX

Organizational structure that allows to address multiple business dimensions using multiple command structure.

emerged in aerospace in 1960

Forms of MatrixFunctional matrix

Balanced matrix

Project Matrix

Authority not equal to responsibility

Every one has one boss Ambiguity and conflict Increase cost for new

management

Leverage vast resources while staying small and task oriented

Focus on multi business goals Innovative and fast action for

those who know how to use it Enhance personal skills Increase Flow of info through

lateral communication channels

Strengths Weaknesses

RESEARCH METHODOLOGY

Current research Based upon author’s Work But primary based upon surveys, interviews, workshops

with 294 mid level and top level managers of 7 Major US based Corporations in Six industries

Duration in matrix Structure 3 to more than 20 years n either in initial stages

Revenue is 70 billion$, 170,000 employees, 42 participants from each company with tenure 13.4 years.

APPROACHES IN DATA COLLECTION

1st phase send a survey to participants to identify major challenges and best practices

2nd phase an in depth case study with North American automobile manufacturer for deeper study

MANAGING IN MATRIX

Five major challenges in matrix Misaligned goals Unclear roles and responsibility Ambiguous authority Lack of matrix guardian Silo focused employeesCompare views of top level and middle level managers

MISALIGNED GOALS

Work in different dimension 47% mid level managers and 6% top management Used 5-point likert scale to check frequency Top level managers(M=3.97, SD .91) Middle level managers(M=2.55, SD 1.00)

MISALIGNED GOALS

Issues

Competing or conflicting objectives Inadequate process to align and deduct Lack of coordination, Poor timing of work plans and objectives Conflict in functional objective and regional requirement

(training req, permission from HR)(inc incentive by PM less profit for Brand M)

MISALIGNED GOALS

Strategies

Cascading Goals Horizontally and vertically

Communicate constantly objectives to employees minimize discord

UNCLEAR ROLES AND RESPONSIBILITIES

83% mid level 23% top level managers

Mid level(M 3.24, SD 1.21)

Top level (M 2.16, SD 1.08)

UNCLEAR ROLES AND RESPONSIBILITIESIssues

Unclear job description and guideline for role and responsibility

Create tension Confusion about boss Whom to contact for information Constant shifting create uncertainty Poor planning (transition to matrix organization unclear

responsibilities of middle level)

UNCLEAR ROLES AND RESPONSIBILITIES

Strategies

Clear guideline on role and responsibilities

Assignment of accountability

Single point for information and approval

Plan for communication and information sharing(monthly meeting)

RASIC(responsible, Approve, Support, Informed, Consulted)

AMBIGUOUS AUTHORITY

Leaders have responsibility without authority as dual reporting structure

62% middle level, 71% top level

Top level managers(M 3.97, SD 1.05)

Middle level managers(M 3.79, SD 1.12)

AMBIGUOUS AUTHORITY Issues

Confusion over final authority Lack of clarity of area of accountability Delay in decision making process Leaders don’t share decision rights

AMBIGUOUS AUTHORITY Strategies

Culture plays crucial role(in collaborative focus on solution, in political focus on maintenance of status)

Negotiation and persuasion skills required Decentralized decision making

MATRIX GUARDIAN

Lack of performance measures of matrix

Middle level manager 35%, top level managers 91%

Top level manager(M 3.17, SD 1.02)

Middle level manager(M 2.26, SD .99)

MATRIX GUARDIANIssues

Lack of consequences and rewards for performance matrix fail to motivate employees

Lack of monitoring systems

MATRIX GUARDIANStrategies

Establish monitoring process to deduct and identify matrix performance

Ensure matrix guardian have approach and authority Preserving undue political pressure

SILO-FOCUSED EMPLOYEES

Employee view their loyalty belongs to certain subunit. Mid level 72% top level 69% Top level (M 3.83, SD 1.15) Middle level(M 4.08, SD 1.13)

SILO-FOCUSED EMPLOYEESIssues

Personal conflict b/w leaders delay collaboration Withholding resources from others insufficient communication b/w business units

Two reasons of this behavior Employee reside in same function throughout careers Matrix require more collaboration then traditional and

employees are not trained for that

SILO-FOCUSED EMPLOYEESStrategies

Define expectations Provide training Work across functions Build relationship