I overheard a telling corridor conversation recently:

“So who is your boss now, Hannah?”

“I’m not too sure; I think I have two. I guess I’ll find out when something goes wrong!”

I mentioned this to the CEO, who was not surprised.

“That’s the problem with the matrix.”

If a company has a complicated operating model, if people are not collaborating well, or if there is a need to centralise to save money, many organisations instinctively put it in a matrix!

The creation of the dotted line is a classic response to having to cope with the realities of a complex world, reaping the benefits of centralised functions whilst staying nimble enough to respond to market opportunities.

Historically, matrix management has been seen as a default method of joining the dots and, to be fair, it has worked in many cases.

Today, however, a matrix structure increasingly looks like a lazy response by those with a hand in designing organisations. It is unlikely to be a strong feature of those businesses that will win in the 2020s.

In contrast, the winners are likely to be organisations that zap complexity with flatter and more fluid organisations, self-managed teams, and work defined by projects and skills rather than functions and roles.

Flattening your structure means taking a hard look at your organisation and removing the layers that don’t add value – the rather stark label is Redundant Hierarchy.

These hierarchies typically consist of roles that serve as points of aggregation in the organisation. They may also be legacies of a previous reorganisation or have been created to solve a talent management problem.

Three good things happen when you flatten your structure:

  1. Management costs go down
  2. Decision making is pushed deeper into the organisation
  3. Empowerment increases

Fluid organisations shift the focus of the workplace from an environment where people are required to adapt to the ‘system’ (structure, roles, and processes) to a place where the system adapts to people.

Here, the term organisation is the verb, not the noun. People can realise their value and potential by finding the places and relationships in the organisation that maximise personal contribution and growth. In a fluid organisation, people come together in service of problem-solving and solution finding, unencumbered by role definitions or departmental boundaries.

Many factors need to be in place to activate and support a fluid organisation, including delayering the structure, leaders who are prepared to let go of their situational power, technologies that support self-management and collaboration, and a North Star purpose to guide people in their decision making.

This is game-changing stuff, and such changes are rarely easy.

Organisations are complicated, comprising many moving parts with varying degrees of interdependence. But they are also complex, made up of people with individual motivations and mindsets. This means you cannot rely on simple cause and effect relationships when trying to achieve change.

Yet while making the change might feel daunting, and there are headwinds to deal with, I think flatter organisations that allow fluid talent to flow are well worth fighting for.

If you’d like help with examining your hierarchy, we’d love to assist. 

Contact us to understand more about how we could help.

Image (c) Shutterstock | Vadym Pasichnyk

Phil Merrell
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