Matrix structures: the pessimism advantage

Matrix oganisations have been loved and hated in varying proportions over the years.  They are problematic because their key feature, involves managers in two reporting lines: ‘vertically’ often along functional lines and also ‘horizontally’ (laterally) along project, product, client or geography lines.   The intended purpose of this dual reporting is to increase lateral co-ordination at the levels below the leadership team.

However, Nigel Nicholson, in How Hardwired is Human Behaviour? noted that: ‘[Matrix management] has proved to be one of the most difficult and least successful organizational forms. The reason?  Evolutionary psychologists contend that matrix forms are inherently unstable due to the conflicting pulls toward too many centers of gravity. People are instinctively drawn toward commitment to one community at a time, usually the one that is closer and more familiar to them. Thus, when a modern businessperson is asked to report both to her regional boss and to a product manager, she is typically drawn to the regional boss because he is physically closer to where the employee works and to what she knows best. Similarly, when a manager “belongs” to a function and a project, her allegiance to the function – her primary assignment – usually prevails. The dual loyalties required by matrix management are difficult to sustain in the long term.’

Because the idea of working as a matrix organisation is gaining ground in some work I am doing, I’ve just re-read the HBR 1990 article Bartlett and Ghoshal article Matrix Management: Not a Structure, a Frame of Mind Surely the date is wrong?  It could have appeared in this month’s HBR and would have been just as welcome and informative.  There’s no aging in the statement: ‘Today the most successful companies are those where top executives recognize the need to manage the new environmental and competitive demands by focusing less on the quest for an ideal structure and more on developing the abilities, behavior, and performance of individual managers.  Change succeeds only when those assigned to the new transnational and interdependent tasks understand the overall goals and are dedicated to achieving them.’

Continuing with HBR, the more recent, 2016, Vantrappen and Wirtz article Making Matrix Organizations Actually Work says much the same thing.  That in order to achieve good lateral co-ordination you need soft wiring and hard wiring.  Bartlett and Ghoshal (1990) describe this as the formal structure (basic anatomy) together with the soft elements of ‘organizational physiology—the systems and relationships that allow the lifeblood of information to flow through the organization, and a healthy organizational psychology—the shared norms, values, and beliefs that shape the way individual managers think and act.’

‘Actually work’ is a phrase associated with a classic book on matrix organisations.  Jay Galbraith, in his book Designing Matrix Organizations That Actually Work maintains that they do.   Phanish Puranam, writing an obituary of Galbraith, who died in 2014, recalls how Galbraith ‘laid out the problems with the pessimistic rhetoric about matrix structures (“utter nonsense!”), and how the label itself was being bandied about without any precision.’

Now, our organisational challenge is to make the matrix organisation idea ‘actually work’.  My task is to follow the optimists on the matrix structure and mindset rather than the pessimists.   I am, unfortunately, rather more drawn to the pessimists.  Luis Goncalves, blogging on the topic, for example, talks about the political in-fighting, the goal conflict, the blame culture, and the management issues. He bluntly says that a ‘matrix organisation harms your company’.

Research from McKinsey, Revisiting the Matrix Organization (2016) follows the bleaker outlook, finding that matrix organisations ‘may create uncomfortable ambiguity for employees … the structure gives rise to a lack of clarity about responsibilities, expectations, and who reports to whom’ and that ‘Most employees in matrixed organizations, according to the survey, aren’t terribly engaged with their jobs.’

However, if I look on the optimistic side of being a pessimist I can take the view that pessimism will lead me to examine the risks and downsides closely in order to avoid them as we head towards a matrix structure, thus pessimism becomes advantageous?

My pessimist/sceptical lens may lead me to closer critical reflection on the report from Hanover Research, Best Practices in Matrix Organizational Structures which offers potentially helpful questions to start us down the path of making the matrix actually work.

Echoing the hard/soft or anatomy/physiology/psychology of other writers on matrix organisations, this report’s authors preface their question set with the point that ‘matrix organization structures reflect the reality of today’s external and internal business complexity…but the matrix structure itself solves nothing—it is the way people operate the structure that makes the matrix organization succeed or fail.’  Their advice is ‘After deciding to adopt a matrix structure, particular consideration should be given to the following questions:

  • How do we operate effectively with responsibility and accountability without authority?
  • How do we manage expectations of multiple bosses?
  • What is the best way of dealing with ambiguous and shifting reporting lines?
  • How can we best influence those separated by distance/time/culture?
  • How do we manage communications?
  • How do we manage conflict?
  • How do we develop routine relationships?
  • How do we clarify role specifications/performance objectives?’

Rather than taking a pessimist view,  and getting stuck in thinking a matrix structure is unlikely to work, I could use the questions to ask ‘if [we did …]  then … ‘.

However, it’s easy to sink back into pessimism as the report says, ‘Successful implementation requires shifting the organization’s culture, addressing the important function of emotional intelligence, and providing comprehensive training for both leaders, [managers] and employees alike.’  No mean task in this.

For example, the ‘comprehensive training’ advocated requires considerable resource investment.  There is the practical skill development, related to the formal organisation, that leaders require e.g. setting two-manager objectives, assigning accountabilities and there is emotional skill development, specifically in what were found to be four competencies in leaders successful in matrix roles: empathy, conflict management, influence and self-awareness.  ‘Influence and conflict management capabilities help leaders to build consensus around a common purpose and deliver the collaborative solutions that the matrix requires. Empathy, on the other hand, enables leaders to develop a better understanding of their counterparts’ perspectives and their customers’ mindset. Self-awareness allows leaders to summon the patience to manage the complexities of the matrix. Three additional skills noted in this same article as critical are ability to build loyalty, trust and interpersonal relationships.

My pessimistic bent suggests that the resource investment will not be easy to get but then I ask myself ‘What are the innovative and creative ways of solving that problem – perhaps the TRIZ framework could help here?’.

Do you see a pessimist advantage in getting a matrix organisation to actually work?  How would you tackle the matrix challenge?  Let me know.

Image:  Antony Gormley, Matrix II 2014

2 thoughts on “Matrix structures: the pessimism advantage”

  1. Thanks Naomi!

    I don’t know how you write such comprehensive thoughtful reflections every week, but kudos and thanks to you.

    I like your idea of allowing the pessimism/scepticism to be prepared for this kind of structure, and some of that way of thinking seems useful for most major changes.

    I do wonder how much of the effectiveness of a new org structure, like a matrix, depends on a few factors:
    1. The business case
    2. The maturity of the people…after all, not everyone is allergic to ambiguity.
    3. The leadership culture
    4. The HR systems
    5. The “how” the org change was generated and implemented. Obviously there is a wide range of how this kind of change could be done.

    My institute just went through a major re design last year. We are a small institute, 45 people, so some of our lessons are not totally scalable, but we did get everyone involved along the way as much as possible. We have gone from a more conventional structure to something like an adhocracy, so everyone has multiple leaders and so far so good, but it is an ongoing journey.

    Anyway, it is so interesting to hear all the optimistic and pessimistic views on matrix, even after all these years.

    May we all have the wisdom to know what is the best way to design our orgs that will fulfill our missions.

    Thanks again Naomi!

  2. Hello Naomi,

    I have looked into this a couple of times myself. I have concluded that it is very hard to discuss the matrix organization without first defining what one is talking about. If one is talking about organizations with multiple bosses, that is now (in my opinion) a model that has been superseded by other and better alternatives, such as the front-back model and what I call the modular organization (both of which rely on internal-customer relationships to link units together, rather than reporting relationships). I also see conflicting goals and priorities as a sign of bad systems design, and something that should be dealt with by better design, rather than by training people in handling ambiguity and conflict.

    I write about it in these blog posts:

    http://www.organizationdesign.net/three-misconceptions-matrix-organization.html
    http://www.organizationdesign.net/a-matrix-is-not-the-only-type-of-multidimensional-organization.html

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