Functioning and Management in an Organizational Matrix: A
Psychological and Managerial Perspective
By: Ya’ara Eldama, Amnon Katz & Shoshi Setat
The writers of this article belong to “Gaya Organizational Development.”
Ya’ara Eldama- has a graduate degree in Organizational Employment Psychology
from the University of Haifa, is an organizational consultant and is a facilitator for
groups of managers.
Amnon Katz- a clinical psychologist, the CEO of Gaya Organizational Development,
accompanies organizations both within and outside of Israel.
Shoshi Setat- psychologist and organizational consultant, specializes in personal
consultation for managers and building and development of teams.

We extend our gratitude to Efrat Ben-Nachum Navo, an organizational
consultant in our organization, who has contributed to our field.

“Gaya” works in conjunction with the MBA program for Business and
Management Psychology.

Content and psychological counseling organizations in the curriculum at the
College of Management.
The “organizational matrix” phenomenon, where organizations transition from a
hierarchical structure (the traditional outlook) into a matrix form, has become more
forgotten in recent years. Furthermore, there are many challenges in transitioning
into more of a matrix form, such as: dealing with changes in understanding the
managerial position (shifting from management based on authority and control, to
management based on cooperation and the need for interpersonal relationships);
dealing with multiple conflicts as a structural component in the matrix; having to deal
with rejection, self-esteem issues and more.
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The goal of this article is to analyze these challenges and attempt to understand the
experience of managing in a matrix. In addition, to offer effective coping skills to help
the manager get through challenges and deal with change. First this article will
attempt to describe, what is a matrix? How does it differ from the hierarchical
(traditional) structure and what are its advantages? Furthermore, the article will focus
on the aware and unaware coping strategies of managers in an organizational matrix.
Finally, several effective coping strategies have been found in several organizations,
to work in an organizational matrix will be mentioned. The article is based on the
professional experience of the authors, whom work in Gaya, which works with
organizations that have successfully overcome change, with the proposed literature.
Background: The build of the matrix, the definition, characteristics and goals
Gottlieb (2007) explains in his book “The Matrix Reloaded,” how an organizational
matrix attempts to gain from the benefits of a divisional build and a functional build.
The organizational matrix divides simultaneously part of the organization into
activities and projects such as a divisional organization would (for example according
to products, customers, geographical location), and another part of the organization
focusing on functional guidelines (for example marketing, research, development,
logistics). Each divisional group is in contact with a functional group, and the
employees are required to report to two managers at least: a functional group
manager, and project financing or business manager2. Organizational matrices can
exist temporarily in order to achieve specific goals (for example, a team of specialists
created to deal with a specific problem, however when it is solved, the team is
dismantled and dispersed to functional groups in the organization or to positions to
complete other organizational tasks). More permanent matrix designs are integrated
when there are product lines consistent with the organization (for example, a product
manager is in charge of creation and development of the product, while his team
works on additional products from time to time).
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Applications of matrix organizations can vary depending on the developmental stage
of the organization, it’s organizational culture and its’ unique characteristics. Some
organizations are organically built in a matrix, as it is an essence of their work and of
the people who work there. Other organizations decided to become a matrix
organization, as their previous design did not achieve their desired goal. A food
organization is a type of organization which can make this transition for example, 3A
matrix structure is a strategic move aimed at maintaining a leading position in the
business market. Switching to such a structure for the purpose of benefits will
increase the work processes, allowing the business to “stay for generations.”
Benefits of a matrix organization
The matrix organization has several key potential benefits:
1. Satisfying an appropriate response to the requirements of the corporate
environment- the logic underlying the adoption of the matrix and its
countless forms, comes from the assumption that the behavior of complex
business environment requires a complex organizational structure and is
more flexible. This structure allows for the creation of specialized teams to be
created from members throughout the organization, thus allowing them to
perform special projects. This allows for specialists throughout the
organization, whether it’s organizing a task force or the existence of
permanent headquarters for a staff of experts. 4Organization and coping with
external complexities is flexible, and can use different resources in the
organization.
2. Accelerating decision making and speed of work- work and team
responsibility characterize the matrix structure, and thus avoids a “ bottle neck
organization,” which can lead to most of the responsibility falling in the hands
of one member or one function. Hence this can increase the speed of work
and decrease organizational bureaucracy2 3.
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3. Preventing the tendency to focus on the goals and local interests- within
the matrix exists an overlap in responsibilities therefore requiring greater
cooperation between the various units in the organization. Consequently
there is greater potential for the development of a systematic view amongst
members of the organization and reduce the tendency to focus on goals and
local interests of the unit of which they belong 4.
4. Improving communication and flow of information in the organizationunlike the hierarchical structure, which is “flat,” in regards to interaction, the
matrix structure is filled with interaction throughout the organization (not just
with one group, which occurs in hierarchical organizations). The great number
interactions allow for an improvement in organizational communication and
the flow of information throughout the organization.
5. Reducing costs for companies across Israel or globally- matrix structures
may be especially effective for companies nationwide or globally. These
organizations have difficulty to develop teams of experts in any divisional
geographic location around the world. The matrix allows employing a team of
functional experts, and when there are new specific projects, which require
their expertise, they can be allocated to specific teams, without the
requirement of the company holding a regular pool of experts in each area.
The result is a more effective usage of the company’s experts, allowing for
the company to respond to challenges in a more cost-effective and systematic
manner2.
Matrix-based environment management
The environment of the matrix has created a unique “Zen” feeling known as “the
matrix management.” This management system has presented the organization's
executives new job requirements and varied challenges. This article focuses on
challenges and difficulties that stand before the matrix and the manager of the matrix,
while observing the implicit and explicit processes passing the manager.
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Significant change in the perception of the role and form of “traditional
management”
As part of the counseling process in a large industrial manufacturing company, the
logistics manager raised difficulties she had to deal with due to the transition to the
matrix management. Prior to the transition, each of the five geographic units of the
organization conducted its logistics independently (including the manager). Each
logistics manager was only required to report to his or her immediate manager.
Because of the transition to the matrix structure, one logistic manager maintained all
the responsibility of all five units of the company. The manager was faced with a
problem when he had to organize trucks to send shipments between all five units:
each location’s logistics manager would not respond to his demands or adapt
themselves to the proposed schedule by the manager. The fact that they had to
answer to an additional, external manager and consider her interests created anger
and frustration. To the manager’s surprise, several of his trucks returned to him not
completing their task. As he tried to resist and exert more power, the managers only
resisted more.
This story exemplifies a problem a matrix manager can face. Managing from the
matrix does not only change the roles, but also requires adjustments to the
administrative role concept. Many managers learn that the techniques they used until
now become less effective in a matrix structure. If a logistics manager was once used
to being in power, authoritative, and in control, he must now adopt a new
management method based less on authority and more on cooperation and shared
responsibilities. He cannot stay on the old aggressive position and give instructions.
This produces a different kind of working relationship, shifting from the status of
being “courted” to being “wooed.”
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When observing organizations that have shifted into a matrix structure, you can find
many managers that experienced the feeling of a gap between understanding this
new recipe, and the application and emotional understanding of the recipe. Although
they speak and understand the language of the matrix, they have trouble actually
applying it. In other words, the change occurs at the cognitive level, however in the
behavioral and emotional level, a gap still exists. Hence, many managers become
frustrated as they feel that they have been stripped of their authority, and have only
gained more responsibilities. Thus, the initial experience are feelings of loss: loss of
power, loss of status, loss of control; “The dispossession of territory”; and loss of
professional face.
Dealing with rejection and self-esteem issues
In the presented example, the logistics manager whom were use to working in an
autonomous fashion in a hierarchical structure in their local units, are now required to
work with new additional units. Furthermore, as they were once their own masters
and conducted their logistics internally, they must now answer to an external force
that may conflict their interests and make decisions for them. This situation often
creates feelings of frustration and anger, which tend to be directed towards the matrix
manager directly or indirectly. Such situations can cause the following responses:
“Who doesn’t know my territory?” “Why is he getting involved in my business?” “He’s
going to teach and conduct me?” “What’s his advantage on us?” These questions are
echoed by the matrix manager and involve the issues of value: “Am I really needed?”
“What is the added value of my role?” Many times the matrix manager may feel as
the “fifth wheel” of the company, or as if his position is “not recognized.” Moreover,
rather than receiving complements and admiration from his subordinates in the
hierarchical structure, he now receives negative responses. Loss of awe and
admiration from others can produce anxiety arousing such questions as "am I
appreciated?" "Am I perceived as meaningful?” As well as making people "hungry"
for recognition and appreciation.
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This complex situation created by the matrix, requires the manager to develop the
ability to cope with hostile responses and aggression directed at him and not be
"destroyed" by them. He must also learn to cope with the experience of rejection and
feeling useless while developing resistance against them.
Many managers will turn to a higher authority looking for answers (“escalation”). It is
important to understand that turning to a higher authority is legitimate, however
should not be a key source. In other words, the manager must know to conduct
difficulties independently and not to be afraid to deal with them and be able to make
decisions for himself.
Dealing with multiple conflicts as a structural component in the matrix
A matrix-based management is capable of creating multiple conflicts and economic
conflicts amongst managers. This is because multiple potential conflicts are part of
the matrix. For example, you can find a potential conflict between a functional
manager and his corresponding project manager. These managers share a common
responsibility for organizing projects and there is a mutual dependency between
them. This contrast creates mutual tension increased by possible conflict between
various interests: project managers feel responsible to meet the objectives and time
frames, while functional managers are more concerned with the effectiveness of their
departmental resources (human and material) and how to preserve them in good
condition2. As a result, a conflict can be created in which each side imposes its will
on the other. Managers that are accustomed to the previous hierarchical structure
tend to focus their loyalty and concern to the objectives and interests of their unit,
thereby finding it difficult to work together as in such a complex situation.
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Dealing with multiple significant changes in the role and perceptions of the
world
It is evident that the transition to the matrix requires many changes: in definitions and
perceived role in the work with subordinates, interfaces, capabilities and skills
required for the job, etc. This is a significant change in the existing situation and all
that was familiar and known to date. Many find it difficult to accommodate such a
change, since it requires the individual to abandon everything he knew and was
accustomed to it so far, thus having to adopt a new mode that appears to him as
alien and unnatural.
Gottlieb (2007) claims the unique challenge to changing to a matrix lies in the “basic
assumptions,” regarding the organization and its culture. He claims that most
companies are built in a hierarchical fashion (including the family unit), and we
thereby see the structure of a hierarchy as being natural and normal. Transition to
the matrix challenges our most basic assumptions about what is natural and normal
in our cultures and societies. The change requires people to cast doubt on what once
seemed stable and set in their world. As a result, there are attempts to break the
hierarchical structure, which tend to evoke anxiety and difficulty by being
encountered with much resistance at first. High levels of anxiety and confusion may
produce a tendency to split perception of reality, that is, the perception of situations
and people in terms of "black" and white"," good "and bad", "worthy" and “unworthy",
those that "give" and those that “receive” etc. (5 this protection serves us in organizing
the chaotic experience. This situation often combines schizo-paranoid; a term initially
coined by Melanie Klein).
In our opinion, the challenge in consulting is to first provide a space for reflection and
inquiry, which enables people to identify the consequences that creates the change.
The goal is to try to make the individual more aware, integrated, and provide him with
tools and skills to deal with the complex matrix.
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Effective matrix-based management: “The keys to success” and suggestions
for coping mechanisms
In the following section, we will discuss several keys to success and suggestions for
coping mechanisms that have worked for managers who have transitioned into a
matrix structure. In order to “crack the matrix,” and work in it effectively, manager
must undergo a changes at the conceptual level, interpersonal level change and
behavioral interpersonal level. A deeper understanding of the environment of the
matrix, its refinement and its improvement of tools of working in this environment, are
essential and necessary components, which can enable managers to regain a sense
of control into their own hands and succeed in the matrix format. With this, its
important to note that the keys to success and their degree of importance may vary
from organization to organization depending on the type of change and the nature of
the organization, for example there must be an alignment with the unique
characteristics of organizational culture and organizational members.
Shifting of the locus of control
Firstly, the manager must change his mode of thinking from “I am controlled by the
matrix”, to “I control the matrix.” Thus shifting from external control to internal control.
Working with matrix-based organizations, individuals can many times feel that the
subordinates feel “the managers have made a mess of things,” and the need to
define areas of responsibility, authority and generate solutions to problems that arise.
With this, in order to effectively manage a matrix requires adopting a more active role
and a wider understanding of the manager because he must create the solutions on
his own. The manager must release himself or herself from the attitude that
“somebody else” will solve this problem created by the matrix.
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Changing the perception of the role
Changing to a matrix format requires the manager to change his role perception.
Managers who have succeeded in the matrix understand that they must be willing to
release some of their power and status, while using integrative cooperation. The joy
of the work stems from the valid connection, and interpersonal power source of the
manager's ability to harness and mobilize workers. Amongst the insights that the
logistics manager (from earlier in the article) arrived at, was that he must personally
go and create interpersonal relationships with each of the five other managers. He
now understands that sending the order “from above” will not help, and as the matrix
manager he must create tight interpersonal relationship with his subordinates.
It is important to understand that any major change (as explained in Bridges book
“Transitions and New Beginnings” 6) for managers requires time, as it is a gradual
process. In regards to this, it is interesting to be reminded of a matrix-format change
experienced by a principal that participated in a seminar. Managers in the seminar
were first asked to draw a drawing called “myself as a manager.” The principal drew
a stick and a carrot. At the end of the seminar (explaining the matrix-based
structure), a month later, she claimed that she would have drawn the drawing
differently. The amazement of the principal stemmed from the understanding that the
management concept expressed in her drawing is not effective or suitable for the
matrix. This new situation made her feel the need to act less authoritative and
conduct her dialogues in more interpersonal manner. These values were not
expressed in her initial drawing. In other words, the principal shifted her role
perception. The concept of “the stick and the carrot” is much more suitable for a
hierarchical structure and is now left behind for it not suitable for matrix-based
management.
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The matrix can be cracked only when exiting the maze: understanding the
matrix, the concept of the matrix and the “win-win” mindset
In order to appreciate the implications of the matrix and to act more effectively in it,
the manager of the matrix must be able to exit the matrix and observe the
organization at the macro level, as well as the entire system. Part of understanding
the matrix understands that when acquiring such a system, there will be conflicts and
loss of control. The wisdom lies in understanding that conflicts do not necessarily
mean something bad for the organization, and one should separate between
personal conflict related to a position, to personal conflict related to the individual.
Developing a systematic view of the organization allows for viewing possible
complexities and encourages the change from “we” and “them” to “all of us together”:
which considers the interests of having a “win-win” attitude. All these together create
emphatic feelings and respect between individuals, which allows efficient solutions of
conflicts and lead to cooperation. Furthermore, the understanding of the complexity
the matrix can help an administrator to contain the emotional complexities it brings
with it, and allow it to better deal with issues of value and rejection.
Interpersonal relationships as part of the management role perception
The key words in managing an effective matrix are: awareness, interpersonal
sensitivity and interpersonal relationship. From this there are several concepts and
interpersonal skills we should develop and work on:

Creating dialogue and avoiding isolation- it is important to maintain a regular
and ongoing dialogue frequently with various interfaces, mainly with
interfaces charged and that have a high potential for collisions. You should
discuss "gray areas" and non-ambiguities, but also initiate a meeting from
time to time on what does work. It is important to avoid isolation.

Increasing self-awareness and awareness of others- one must have an
internal dialogue asking questions such as: “What are my internal needs?”
“What are the internal needs of my contacts?” “What is it that each side brings
to the conflict?” etc.
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
Attunement to the other- adopting openness, sensitivity to the needs of the
other listening, requires asking questions such as: “Do I understand my own
needs?” “Am I aware of my place?” “What is the range of my relationships?”
“What is the added value of our conjoined work?” etc. A manager can perform
more freely if he can release himself from his ego and improve his
interpersonal relationships. This is a very difficult task, which can at times
require releasing ourselves from managing in a normal and “automatic”
fashion. It is important to understand that the attunement of the other does
not mean giving up on personal needs, however it does require a deeper
understand of the opposing side and their needs in order to create a good
working environment, thereby achieving cooperation and a “win-win” situation.

Continuing work based on mutual trust- having all of the above helps to
develop mutual trust between the parties. However, it is important to
understand that the work on mutual trust must be sustained and is unceasing.
Conclusion
Switching to matrix-based management requires many changes. It requires from a
manager to adapt to a new method of management, which can potentially be
challenging and problematic. However, “cracking” the matrix is not impossible. By
developing awareness and understanding of the complex situation of the matrix and
its established characteristics, and improving the work process through personal and
interpersonal elements, matrix management can become much more effective.
Processes of organizational development consultancy (as an accompaniment
managers, personal counseling, workshops that focus on topics of matrix
management, constructions and development teams, etc.) are featured as significant
tools, which can help the manager and organization adapt more quickly to the
transition of the matrix (emotionally and practically), and hence work more effectively
in this format
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References
1. Gottelieb, M. R. (2007). The matrix organization reloaded: Adventures in team
and project management. Westport, CT : Praeger Publishers.
2. Numerof, R. E. and Abrams, M. N. (2002). Matrix management: recipe for
chaos? Directors & Boards, 42(4).
3. Dinsmore, P. C. (1984), Whys and why-nots of matrix management, In D. I.
Cleland (Ed), Matrix management systems handbook. New York: Van
Nostrand Reinhold.
4. Bartlett, C. A., & Ghoshal, S. (1990). Matrix management: Not a structure, a
frame of mind. Harvard Business Review.
5. Segal, H. (1964). Introduction to the work of Melanie Klein. NY: Basic Books,
inc., Publishers.
6. 8002( .‫ ו‬,‫)ברידג'ס‬. ‫ להבין את משמעות השינויים בחיים ולהפיק‬-‫מעברים והתחלות חדשות‬
‫מהם את המרב‬. ‫מטר הוצאה לאור‬.
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