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ACTIONLIST
Coping with Matrix Management
Getting Started
Matrix management is a system of management based on two or more reporting systems, linked both to the vertical organizational hierarchy, and to horizontal relationships. In other words, any employee within a matrix organization, as well as reporting upwards to more senior staff, may well also be reporting sideways to peers, based on geographic, product, or project requirements. Matrix management arose as a way of enabling organizations, in an increasingly complex business world, to get the balance right between the key drivers of their business. It is also seen as a more effective way of employing the skills and talents of individuals within an organization, as they can be directed to where they are most needed and add most value, for both the short term and long term. However, implementing a matrix structure should not be undertaken lightly. It has to be right for the business and its future strategy, and fit with the skills and competences of the people who work there.

FAQs
Isnt matrix management good for the organization and terrible for the individual? On the surface it looks as if the organization is the winner when it comes to matrix structures, as it can maximize the use made of individual skills and minimize the burden on management. However to those running the business, matrix structures bring pressures: they have less control; better communication is required; and it is essential to introduce the right types of systems and procedures which allow some control, but do not stifle the business. These systems should encourage flexibility and ensure that conflicting needs do not hamper decision-making processesas well as setting the balance between responsibility and accountability for individuals. If they are right, matrix management can be extremely good for the individual. In many organizations, one structure usually predominates. How do you get the balance right in matrix roles? Organizations are still learning how to manage vertically and horizontally. Matrix management tries to provide the flexibility and responsiveness to be competitive. Getting the balance right is about understanding the issues in the business and creating boundaries for roles to ensure that value is added. Too often, not enough time is spent clarifying what individuals, roles, and teams can contribute.

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BUSINESS: The Ultimate Resource

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Does matrix management really work? Surely there are some real downsides! Matrix management is not a new concept and has been used for years by many wellestablished and successful businessesparticularly in project management. For it to work, the business case must be strong and there must be commitment from the senior team to manage it well. This requires a clear understanding of the organizations objectives and capability of individuals, plus the right systems, procedures, and resources to meet these objectives. Management must be disciplined in not trying to over-utilize the human and physical resource. Isnt it easy for roles and responsibilities to get lost in the matrix? Yes, it is. This is why it is so important to have a clear understanding of what is done at present, how this should be modified, and how the matrix roles should be shaped to match the capability of the people in them. Training and development are integral to ensure success. Time should be allowed for transition between different ways of working, and for people to adjust their approachand the need to create time for planning should not be underestimated. Communicating expectations to those in the roles and to the rest of the business will help cement success.

Making It Happen
Changing an organization structure is a major upheaval, and putting coping mechanisms in place for individuals, teams, and decision-makers is essential. It is also vital to be sure that such a change is right for your strategy and the business, and that you have the capability to deliver it. The following sections outline the stages that you may wish to consider. Set the Context When deciding whether to implement matrix management, you should consider the following questions:

What is your strategy? Where are the demands in your business? What structures are your competitors employing? What are other organizations doing? What talent is available in the business?

There are many organization evaluation tools, which help you analyze the type of structures which are best for your business, given its culture, products and services, and market environment. Establish the Parameters Define the area of your business in which you believe matrix management will work. Make sure that this integrates well with your overall strategy as to where the business is going; can be easily communicated, and that those who interface with it will understand it. Most importantly, make sure that you have the talent in your business to

Bloomsbury Publishing Plc 2003

BUSINESS: The Ultimate Resource

April 2003 Upgrade #7

undertake and deliver the new responsibilities. Without the right talent, matrix structures can quickly become a political nightmare. People in these roles need to be comfortable dealing with complexity, coping well with pressure, handling conflicting priorities, and being able to be pulled in a number of directions at once. Implement the Structure Matrix management is a completely different approach to running a business. It moves away from hierarchical structures, clearly-defined lines of responsibility, and formal communication and decision-making channels. This is a culture change that will need to be planned and managed over time, and not everyone will find it comfortable. Be prepared for some casualties along the way, particularly those who have personal investment in role status and definition. You will need to create new channels of communication so that progress can be monitored and feedback received on the effectiveness of the matrix. Matrices tend to be dynamic and create ongoing challenges to the business and the decisions it needs to take. Steps in the implementation process should include:

undertaking a talent audit and highlighting development needs; defining roles in terms of outputs, not inputs; aligning systems and procedures to support the new structure and behaviors; investing in training and development; coaching and supporting key people to adapt to the changes; communicating regularly to those affected; monitoring overall progress and making necessary adjustments.

Remember that you may need to adjust your reward and benefits package. Matrix roles are often more demanding because of the diversity of issues and contexts in which people have to work. Some Examples of Standard Matrix Areas Operations Customer Responsibility Account for three sites Manager Project planning across the operational Project business, Implemen affecting sales, tation marketing, customer service, Business Finance HR Development Growth Budgetary 100 people working objective of 10% responsibility for on the account in all per annum account functions Identify possible new opportunities for growth and/or change Direct management of the project team and dotted-line responsibility for key implementation areas

Responsibility for completing the project on budget

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production Working with customers and Responsibility business for all IT development to systems, IT support and Manager working with identify new key operational ways of areas working, leveraging IT

Responsible for supporting management information systems

Direct management of the IT team and dotted-line responsibility to functional heads

Review and Refine the Structure, Roles, and Individuals Successful organizations adapt to their environment, and regular reviews will highlight the need for changes. These can be process orientated or structural in nature. Be prepared to alter role definitions and move individuals. Getting the right balance between fluidity and structure is an art rather than a science, and an imbalance is one reason why matrix structures fail. Coping Mechanisms for Individuals

Form focus groups to discuss and identify helpful ways of creating the new structure. Minimize potential grievances by involving people in consultation about the new structure. Be aware of your own preferences. Create a development plan with key priority areas. Invest in training where there are obvious skill gaps.

Coping Mechanisms for Implementers

Choose an area of the business where there may be the least resistance to change. Plan the steps carefully, and make sure that you have the support of senior management Build in time to communicate, so that objections can be addressed before the change. Clearly define roles, responsibilities, and accountabilities. Set time objectives and put in measures. Adjust reward mechanismsand be prepared for several iterations before finalizing them. Do not worry if this is well after implementation. Be prepared to learn from both people and the process.

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BUSINESS: The Ultimate Resource

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Do a force field analysis to understand the need for the change versus the resistance you may encounter. This will allow you to pace the initiative appropriately.

Common Mistakes
You Follow Competitors Leads Without Knowing Your Own Business Well Enough When we see our competitors moving to a matrix structure, we can often assume that it is key to achieving a competitive edge, and that it is imperative to follow suit. This is a mistake, as their culture may be more suited to this type of structure. Understanding your own business drivers, what is best for you, the talent you have, and the pressures you may be under are the only relevant factors in making the decision to move to a matrix. You Use Matrix Management to Hide Other Motivations Sometimes matrix management structures can be implemented to hide a different agendaa cost-cutting exercise, as opposed to a decision made for sound business reasons. This can result in high levels of demotivation and lack of support. You Dont Understand the Implications of a Matrix Structure for Your Organization and People Businesses often do not focus sufficiently on aligning capability and motivation to the new structure, usually because they have not fully understood the demands it places on individuals and teams. People often have to deal with high levels of ambiguity, which can result in stress. By spending time auditing your talent, you can be better able to identify those who are likely to be successful and champion the change.

For More Information

Books: Forsberg, Kevin, Howard Cotterman, and Hal Mooz. Visualizing Project Management: A Model for Business and Technical Success. New York: John Wiley, 2000. Verzuh, Eric. The Fast Forward MBA in Project Management. New York: John Wiley, 1999. Web Site: Strategic Futures: www.strategicfutures.com/articles/matrix/mtrx-1.htm

Bloomsbury Publishing Plc 2003