Businesses, irrespective of size and specialization, are aggressively adopting various new and innovative approaches to organizational structure in order to bring in efficiencies. Streamlining of organisations is being done through alignment of resources basis specialization; optimizing cost structures and enabling employees to perform optimally. Obviously, this is not an easy task to achieve.

The much debated and discussed matrix organizational structure is one approach that organizations across the world are implementing to achieve desired results. This structure is a hybrid of two structures: the functional and the operational. In the functional structure, departments in an organization are divided according to their roles/verticals; in an operational structure an organization is divided by products, customers or geographical location.

The matrix structure is an attempt to combine the two, while retaining the advantages of each. Simple? Not really. First we have to understand what’s the real objective? Is it the stated objectives as mentioned above or to subtly create some confusion/ chaos around who is the real boss? The beauty is that this confusion ceases to exist once you move into a corporate/ HQ location. It is felt, repeat felt, at a regional or country level. Why? Is it a question of creating organized chaos where everyone is looking at each other with some kind of mistrust?

In this complex business environment where ” speed ” and being ” glocal “( global + local ) is the essence , does creating straight lines / dotted lines help in meeting the objective ? A point to debate would be that if a matrix structure is the way forward then why do organizations like the military ; police ; government departments ; hospitals ; other emergency services ; even other labour intensive sectors like construction/ manufacturing not adopting the same ? Why have they kept it simple – clear lines of reporting; clear definition of roles and responsibilities and accountability?

My friends in large global organizations took about an hour to explain to me their organization structure – various divisions / groups / SBU and who is reporting to whom ( various forms of line / segment definition from advanced books of mathematics ) and when I told them honestly that I did not understood , their prompt reply was : “same here!” Which leads me to wonder why we don’t give clear a mandate to one leader with full accountability of men; material & machine?

Undoubtedly, this is a complex work environment. But to be fair to the matrix organizational structure, I agree that it may display certain advantages. For instance, this structure has proven to be successful in the IT sector. This has also worked in a project scenario where project managers in a matrix organization have the ability to create project teams by inducting employees from the entire organizational base. The PMs, therefore, have access to (almost) unlimited specialized knowledge and experience at any given point in time. And because the entire employee population is available to choose from, multiple projects of wide scope often seem possible at a point in time.

Is managing business managing a ” project ” or a ” life cycle ” which requires one to take both tactical and strategic viewpoints to business. The Professional Project and Program Management Certification Program at the University of California, Silicon Valley, led by Systems Management Services, points out that if an employee is involved in four projects; he or she is physically and mentally available for each one for only about 19 per cent of the time. This way, the individual loses 75 per cent of his or her time to the other three projects and another 6 per cent per project to mental and physical transitioning. So for each project manager, is there any value addition really?

In a matrix structure organization, the management must constantly ensure that project authority and functional authority are balanced, with each given equal consideration and resources. This is, of course, is a tricky line to tread all the time because the imbalance can undercut the effectiveness of managers and the structure as a whole. Also, when horizontal and vertical priorities diverge, functional and divisional managers may begin to compete for resources and power. Therefore, coordination and synchronization are crucial to avoid conflicts. Budgets per project within a matrix organization also tend to be smaller.

This limits hiring to a minimum on one hand, and on the other encourages the continued overuse of employees. Spread too thin across the organization and made worse by the inherent confusion of priorities, employees struggle to find their way through matrix structure organizations. Enough to create tremendous mental and emotional stress, there is hardly much for employees to endorse. Although a matrix structure may be in fad, in today’s hard-hitting and cut-throat competitive business environment it can also be a recipe for disaster in more ways than one. And mostly, it emanates one simple desire: Why we don’t keep things simple “and one Big question “Who’s the boss?”