Benchmarks for Excellence in Designing, Implementing and Managing Matrix Organizational Structures

STUDY OVERVIEW
Many large companies are turning to the matrix organizational structure to reduce organizational silos and increase cross-functional cooperation and communication. However, once companies move out of traditional hierarchical structures, the lines of communication and responsibility become blurred. This study provides benchmarks and best practices on how companies with more than 5,000 employees have improved their organizational effectiveness by implementing a matrix structure across product lines, geographic divisions and/or functional areas. It includes quantitative metrics on structural aspects of matrix organizations, roles and responsibilities, and measurement of the impact of these aspects on overall company performance. Executives can use this data to better understand, create and manage these structures for optimal use.

KEY TOPICS
• Matrix Implementation
• Matrix Metrics
• Matrix Transitional Activities
• Matrix Leadership
• Best Practices and Lessons Learned

KEY METRICS
Note: These metrics are at the company-wide level (e.g., percent of companies.)
• Percent Implementing a Matrix Structure within the Last Five Years
• Number of Years to Fully Transition to a Matrix Organizational Structure
• Effectiveness of Matrix Organizational Structure in Meeting Customer and Operational Needs
• Percent Implementing Different Types of Organizational Structures
• Percent Using Various Metrics to Measure/Monitor Matrix Organizational Structure Implementation
• Percent Implementing Transitional Activities and Effectiveness Ratings related to Strategic Communication, Clarifying Authority and Tactical Implementation
• Percent that Measure and Reward Employees and Managers for How Well They Execute Matrix Related Activities
• Percent with a Senior-Level "Matrix Guardian" to Monitor Matrix Related Activities
• Matrix of Which Leaders are Responsible, Accountable, Informed or Consulted in Goal-Setting, Employee Evaluation, Employee Development and Resource Allocation (All vs. Tech Segment)

SAMPLE KEY FINDINGS
• Consistency, clarity and communication are critical to the success of matrix implementation: Companies that rate their matrix implementation as highly successful all used the following transitional activities and rated them highly effective: structured top-down process to select and define goals; structured decision-making process; and a set plan for communication and information sharing. Consistent and continuous communication was the prevailing theme of the majority of benchmark partners’ best practices and lessons learned.
• Managerial responsibility should be weighted toward product managers and subject managers: Accountability and responsibility typically resides in the on-site (geographic) and project managers. However, in companies rating their matrix as very effective, more responsibility is shifted to product and subject managers, while on-site managers are more frequently consulted.

DATA CUSTOMIZATION
Customized data analysis is available for an additional fee. For more information contact Jason Dean
(Analyst) at 919-767-9240 or jdean@best-in-class.com

METHODOLOGY
Best Practices, LLC conducted an Internet Benchmarking Exchange survey with 18 leading companies-- most of which have international/global matrices--across nine different industries. The study was completed for a Global Benchmarking Council member.

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