Virtual Collaboration in a Matrix Organization
Amy Kates and Paul J. Erickson
Chapter in The Handbook of High Performance Virtual Teams, 2008

The matrix structure is an increasingly common feature on the business landscape. As firms grow more complex and more geographically dispersed, leaders are confronted with the question of how to effectively integrate and align staff that work in remote locations and need to be deployed on several projects simultaneously. The need to integrate resources and reconcile opposing objectives creates the challenge of designing mechanisms that will foster true collaboration, instead of simple compromise. As a result, in an attempt to achieve multiple strategic objectives with the smallest number of resources, many organizations are using matrix reporting relationships as a way to link disparate parts of the organization and encourage collaboration.

Use of a matrix presents a dilemma, however. Three decades of study of the matrix in organizations have shown that it is one of the most powerful ways to force interaction among business units and integrate the diverse parts of an organization. At the same time, experience has demonstrated that it is most successful in organizations that already have a strong foundation of teamwork, joint accountability, and the management processes that support collaboration. Therefore, organizations that shift to the matrix in order to get the promised benefits without putting in place the required enabling and support mechanisms, quickly find that they have introduced complexity, confusion, and frustration without achieving the expected gains. Predictably, they soon revert back to a simpler configuration, adding another example to the many that have abandoned the matrix as just too hard to do.

The reality is that most businesses today are complex. They need to serve multiple products, markets, and geographies and, if they are to reap the rewards of growth and scale, they need to integrate laterally and find synergies among all the various dimensions of the business. Complex business models result in complex organizations, including matrix relationships. And the organizations that can best manage this complexity without making it burdensome to either customers or front-line employees gain competitive advantage.

The complexity created by the matrix is usually borne by the middle manager who provides the connections between all of the various strategic dimensions that the business is trying to achieve. Attention to organization design does not remove complexity for these managers, but it can help ensure that the organization is an enabler instead of a barrier to these managers as they try to achieve the required business results.

Implementing a matrix is a significant leadership decision, and not one to make lightly. This chapter summarizes what has been learned about designing and implementing a successful matrix with a focus on virtual environments. The chapter will address using a matrix to bridge the barriers of time and space as well as the challenges of introducing added complexity for teams and managers working remotely. The intent is to demystify this much maligned organizational form and offer tools to maximize the chance of successful implementation.

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