Measuring the matrix

Citation

Hall, K. (2013), "Measuring the matrix", Strategic HR Review, Vol. 12 No. 4. https://doi.org/10.1108/shr.2013.37212daa.003

Measuring the matrix

Article Type: Metrics From: Strategic HR Review, Volume 12, Issue 4

The latest ideas on how to approach measurement and evaluation of HR activities

Many organizations are finding that the traditional “siloed” vertical function-based organization does not meet the needs of today. Increasingly businesses are managing global customers and supply chains, operating more integrated business functions, and working in a way that flows “horizontally” across the organization. Many are responding with a matrix organization structure where multiple bosses, accountability without control and competing goals become the norm.

But how can we measure whether a matrix structure is working? What are the important indicators of success, and how do we manage accountability in an environment where individuals may not have direct control over the resources they require to deliver results.

Reasons for adopting a matrix structure

Structure should always follow strategy, so here are the six main reasons that organizations offer for adopting a matrix structure and some ideas for metrics to measure whether or not they are being achieved:

1. 1.

   Improved access to shared resources, skills and technologies across the organization. We should expect to see this reflected in improved asset and labor utilization.

2. 2.

   Improved cooperation and communication across the old functional and geographic silos. We should be looking for tangible examples of where this delivers business value, for example, in sharing best practices or leveraging product development. We should also be alert to the additional costs of increased cooperation and coordination, which can be substantial, particularly in a global organization.

3. 3.

   Flexibility through faster decisions. Decision making effectiveness can be hard to measure unless we can find similar routine decision processes within the organization to show trends over time.

4. 4.

   Improved global or regional projects and systems. This can be measured through project delivery timelines or the speed of new product introduction. We should be looking for specific improvements in this area.

5. 5.

   Broader and more multi-skilled people development. This should be reflected in our ability to provide succession cover for senior roles and particularly for multi-functional and multi-country moves.

6. 6.

   To meet the needs of global or regional customers. This one is usually an imperative and receives a lot of visibility. Global customer surveys can identify whether perceptions change following a matrix implementation, and, ultimately, improved revenues and profitability are the goal.

Challenges in making it work

An analysis of the challenges that organizations face in making the matrix work identifies that many of the problems stem from the way people work together in this more complex organization. Following are some of the challenges:

1. 1.

   Unclear accountabilities. In a matrix, accountabilities are often shared and we need to have clear processes for resolving roadblocks.

2. 2.

   Slow decision making: see above. This is a common complaint where a matrix structure has been implemented without also giving people the authority and ability to make decisions further down into the organization.

3. 3.

   Bureaucracy. Too many meetings, conference calls, controls and approvals. Maybe we need a red tape metric to keep us focused on this.

4. 4.

   Increased conflict over resources. A useful metric here is the number of escalations to senior managers for decisions.

5. 5.

   Higher levels of uncertainty. This one is tough to measure, except attitudinally.

Getting the metrics right

So as well as having metrics in place to make sure we are delivering the upsides, we should also institute measures that identify whether we are suffering the downsides. Some of these may be measured empirically and others by attitude or climate surveys. For example, our own study of 4,000 people working in virtual and matrix teams in large organizations shows that 20 percent of managers spend on average two days per week in meetings and conference calls and that 50 percent of the content is irrelevant. For a large organization 20 percent of their expensive managerial and professional headcount can amount to a huge sum.

But we need to be careful with metrics. A matrix is designed to allow us to balance competing priorities. In the past, managers could be successful by optimizing their own narrow set of measures, sometimes at the expense of the overall system. In a matrix we need to be able to reward people for doing the right thing across the organization, even if this impacts negatively on their own functional area or budgets. The manager who introduces a new global process in Brazil, which is the right thing to do globally but increases costs locally, for example, should not be punished for doing the right thing for the whole organization.

We need metrics that reflect this complexity and allow for complex trade-offs. Because our metrics are also reflected in performance evaluation, career and pay we need to make sure we are reinforcing the right behaviors and not punishing the very mindset we set out to achieve with a matrix.

Kevan HallCEO of Global Integration.

About the author

Kevan Hall is CEO of Global Integration, a training and consulting organization that specializes in matrix management, virtual teams and global working (www.global-integration.com). He had a 14 year corporate background in trade union negotiation, international HR, manufacturing operations, EMEA sales and strategic planning, and global learning and development in the telecoms and FMCG sectors, before establishing Global Integration in 1994. He is the author of Making the Matrix Work – How Matrix Managers Engage People and Cut through Complexity (2013) and Speed Lead – Faster, Simpler Ways to Manage People, Projects and Teams In Complex Companies (2006). Kevan Hall can be contacted at: kevan@global-integration.com