Some organizations are having better results at extending the benefits of the matrix and mitigating the downsides. One leader stated that 'successful people are stepping up their communication around the organization and being more transparent about their thinking and needs.'

The Matrix is back. Leaders at the helm of many companies know that it's not another movie sequel to the edgy thriller staring Keanu Reeves and Laurence Fishburne. Matrix management, that once-popular organizational structure, has many leaders facing a common challenge: How to make the matrix work?

First: How Did We Get Here?
Matrix management was widely embraced in the 70's and early 80's by companies looking to improve business decisions by convening cross-functional expertise to create better solutions.

The late 80's and 90's found many organizations returning to more hierarchical structures: perhaps trading off the benefits of better, more innovative cross-functional ideas and solutions for the ease of communication and clarity of a simple hierarchy.

But the combination of today's ultra-competitive global market, mounting business complexity, and major world paradigm shifts are mandating the need for employees to work with others all over the company to solve complex problems to win in the market. These paradigm shifts and the related uncertainty of the future are destabilizing — and putting pressure on organizations to innovate and leverage resources more successfully.

For example, one paradigm shift to note is the domino effect of the telecommunication breakthroughs of the last five years. The arrival of inexpensive phone service created the opportunity to move jobs around the world in what seems like a nanosecond. As whole operations moved overseas, matrices were built and leaders were instantly faced with issues of allegiance and alignment with functional areas (usually in the US) and country management (frequently 3000+ miles away) .

The current economic downturn also has a role, combining with other dynamics to pressure companies to leverage information and expertise across the organization — whether to drive innovation or to remain competitive in constantly shifting markets.

Making the Matrix Work
Leaders in virtually all industries are expressing enormous frustration in trying to make the matrix work. The most common hurdles include disagreements about accountability; lack of alignment between businesses on key variables; exponential complexity; multiple "bosses" who don’t agree on priorities; international reporting lines with excruciating processes in working virtually and globally; and continuous merger activity.

We’re seeing recurring patterns with our customers. For instance, this last winter (2009), we worked with a VP in a Midwest Fortune 100 company. Listing his critical business issues at that moment, the VP said (paraphrasing), "There is a huge need with this new matrix structure to ensure everyone is aligned. GMs are saying that they are losing power. The functional leaders (supply chain, sourcing, IT, quality, etc.) will really need to work at broad, aligned ownership. We must learn to work in a matrix organization and we must do it fast. Our margins are heading into single digits and if we don’t figure out how to better harness and leverage the expertise across the organization we will continue to struggle."

He was clearly experiencing serious implications from their matrix structure. But there's more: Here is a sampling of complaints we’ve heard from folks at various levels, in multiple organizations, over the last nine months.

• "It’s impossible to get work done around here now. There is always a new list of people who need to buy off on the smallest of decisions."
• "I don’t even know what they do over there or who to call to find out how to get them involved."
• "I have one boss who says that 'x' should be my main priority and my matrix boss who says to drop it and focus on 'y'."
• "We argue more about the reporting structure than actually doing the work."
• "How do I get the work done now when many of the team reports in to a different director?"
• "Corporate has appropriated our functional resources to 'better leverage across the matrix,' but they don't get anything done."
• "I'm responsible for $31 Million in revenue and an organization of 500 people (with 300 in India) and can’t make a decision to fly over there without the approval of 3 people."

While a matrix organization is frustrating by nature, because it mirrors the external complexity of the today's business environment, developing the skills to deal with the complexity internally helps organizations navigate the complexity of external dynamics. Some organizations are having better results at extending the benefits of the matrix and mitigating the downsides. One leader stated that "successful people are stepping up their communication around the organization and being more transparent about their thinking and needs."

In our experience in consulting with organizations struggling with working in a matrix, we have found that overall leaders need to be more nimble and demonstrate increased skill in having conversations with people outside of their area and sometimes comfort zone. Certain leadership skills and behaviors are paramount, including: key communication skills, strategic thinking agility, entrepreneurial start up energy, self-awareness and collaborative skills.

If you or someone in your company is struggling to maximize results from a matrix structure, there are five key actions for being successful, which I list below and address in detail individually. They are:
1. Get out of your office/pick up your phone and talk to people.
2. Develop your strategic thinking skills.
3. Get off your position and look for underlying organizational interests.
4. Get really good at listening and agreement building.
5. Work on your self awareness, understanding the impact you have on others.

Let’s look at them in detail:

Get Out of your Office/Pick up your Phone and Go Talk to People!
Take time every day to reach out to new stakeholders in your organization. Find out how you are connected, build relationships, discover what they are working on and how you impact each other. Look for areas of leverage; ways to use each others knowledge, skill and staff. Be curious about their business and how they are approaching their own challenges. Don’t let the complexity of the organization chart, historic turf battles or a perception that you don’t have the time, get in the way of being entrepreneurial and seeking new relationships that could create wins for the business. Get skilled at stakeholder analysis, identifying key stakeholders and the win for each.

Develop your Strategic Thinking Skills.
I heard Riley Bechtel (CEO Bechtel) speak recently at a conference. He used a military term to describe today’s business climate: "VUCA" (volatile, uncertain, complex and ambiguous). Leaders can not survive this climate without collaborative strategic thinking skills. Interaction Associates defines strategic thinking as the ability to take in complex and ambiguous information and make sound, shared decisions. The ability to work with others in a matrix organization and effectively scan and organize data, see the relationships among the variables and agree on new hypotheses about the business is critical. Become facile at enrolling others into strategic discussions.

Get Off your Position and Look for Underlying Organizational Interests.
Clear, collaborative heads prevail during the inevitable breakdowns regarding priorities and the use of limited organizational resources. Successful leaders are skillful at uncovering the underlying interests of stakeholders, revealing their own interests and building strong agreement on shared solutions to common problems. Enter into conversations with positive anticipation, assuming a win/win is possible, "bracketing" historical grudges. Learn and practice skills for resolving conflict.

Get Really Good at Listening and Agreement Building.
As Barack Obama commented during the 2008 campaign, "It’s when I disagree with someone that I find it’s time to really stop and listen." None of the actions listed above can be successful without excellent listening and agreement building skills. Practice listening to what you don’t want to hear with a sense of curiosity versus judgment. Make sure that your stakeholders feel heard before you begin any counter-advocacy. Acknowledge the stakeholders' situation genuinely before entering into areas of potential disagreement. Stop and note small agreements on the path to larger agreements. Early in conversations, focus more on areas of agreement than areas of disagreement.

Work on your Self-Awareness; the Impact you Have on Others
At the end of the day, employees at all levels of the organization can be negatively impacted by a matrix organization that lacks the underlying skills to make it work. Working in a matrix is complicated, with an increased likelihood of communication breakdowns that lead to unintended consequences (employee confusion and angst, lack of focus, poor decisions, organizational churn, slow decision making). When actions produce unintended consequences, successful leaders draw upon self-awareness, courage, and skill to adapt and change. Employees are motivated to follow leaders who understand the impact of their behavior and who are willing to change it.

It’s important to remember that the people you manage in the matrix may be skittish. If earlier attempts to "work across the silos" didn't succeed, they may adopt a wait-and-see attitude or even be openly challenging. While the difficulties of the matrix may seem insurmountable, focusing on the five actions listed above can help you make believers out of skeptics. These practices will also help you — and others — navigate the complexity of the matrix with increased skill, alignment, speed and success.