Leadership Essentials for the Matrix Environment

Guest post by Rick Lash, from the Hay Group:

The matrix has often been described as a new type of organizational structure that is flatter, more interconnected, more global and more innovative. In matrix companies, much work takes place across functions with employees reporting to multiple bosses and participating in teams created across departments and areas of expertise.

These descriptions are accurate, but in some ways they fail to capture the strength, resiliency and dynamism of the matrix organization. Consider the biological analogy of the human brain. Recent studies have shown that memories are stored at multiple locations in the brain. If a person suffers physical brain damage through a stroke or trauma, the functions lost in one part of the brain can sometimes actually be relearned by another part of the brain.

This new understanding of the brain as a complex, interconnected network where information is constantly created, communicated and reinvented provides an accurate model of the inner workings of many successful matrix corporations.

Innovation and the Ghost Organization

To adapt to fast-changing market conditions and to respond to complex customer challenges in today’s competitive landscape, companies must innovate. That innovation happens mainly at the interface between functional areas and within deep pockets of expertise.

Matrix organizations typically facilitate these types of cross-functional exchanges that lead to innovative progress. If the formal organizational structure is not set up to facilitate these type of interactions, proactive employees will be forced to create a ‘ghost organization’ that exists behind the façade of the official org charts.

The question therefore is not whether an organization should adopt matrix organizational principles, but whether it wishes to officially and openly adopt the matrix structure or whether it prefers to push innovation underground into the informal ghost matrix.

Dinosaurs in an Asteroid Storm



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The vast majority of organizations are still struggling to help their leaders shift from the mindset of “How do I achieve my own functional success and results?” to “How do I attain enterprise goals by working effectively within a very fluid and complex networked environment?” The old functional siloed approach is no longer sufficient to solve the demographic and economic challenges that most global companies face today.

For the dinosaurs, size alone was an advantage in a stable environment, but agility helped the smaller mammals prosper when the asteroid hit. Similarly, in today’s business climate, economic asteroid hits are becoming more frequent, forcing organizations to embrace matrix operating models that enable vital adaptability, flexibility and the capacity to rapidly assimilate new ideas.

Matrix Competencies in Short Supply

The good news is that many organizations have recognized that their leaders need to evolve. They understand that their leaders must become more effective at facilitating and engaging team members who are not their direct reports, who may work thousands of miles away and communicate exclusively via email and videoconference. They know they need leaders who are avid and rapid continuous learners because the shelf-life of any particular piece of expertise gets shorter as the pace of technological change accelerates.

The bad news is that the competencies that leaders need to be successful in the matrix are still in short supply. New emotional and social intelligence research from Hay Group has shown that Empathy, Conflict Management, Self-Awareness and Influence are all key skills required for effective leadership in the matrix environment. And yet an analysis of our Hay Group’s Emotional and Social Competency Inventory – a behavioral database that includes information on the emotional intelligence of more than 17,000 individuals worldwide – found all four of these competencies to be in short supply among executives:

• Fewer than one quarter (22 percent) demonstrated a strong sense of empathy.

• Less than one third (31 percent) of individuals were found to hold strong conflict-management skills.

• Only 20 percent were found to have a strong sense of influence.

• Just nine percent of employees exhibit a strong sense of self-awareness

Four Steps to Building Matrix Leadership Skills

Leading in the matrix takes some new skills compared to traditional functional leadership roles. It is not that the old competencies have become unimportant, but rather that good matrix leaders need a broader range of competencies including empathy, conflict management, influence and self-awareness to operate and lead effectively in a matrix environment.

So what are some steps that leaders can take to develop these skills that are so crucial for matrix success?

1. Create space to learn. Our research has found that the most effective – and often the busiest – executives still carve out time for learning. They set aside time on their calendars to read or to speak with people who are completely outside their field to get new perspectives. Some of them even commit to teach graduate school classes because it forces them to stay up-to-date on the latest developments in their field. Others keep a journal where they write down a few of the most interesting things they learn each day. Rather than using busyness as an excuse, top leaders who are continuous learners deliberately create the space for self-education in their lives.

2. Network deliberately and diversely. Matrix leaders depend heavily on the strength of their networks, but it turns out that the size of the network matters less than the quality and diversity of the contacts in that network. Successful matrix leaders deliberately seek out people who can be of help to them now and in the future. They make bold connections outside their own area of expertise. For instance, a hospital CEO built several valuable connections with some airline industry executives who had deep expertise in logistics. Their experience of managing people and aircraft under extreme time pressures gave the hospital CEO invaluable insights into ways that he could improve patient flow and control costs.

3. Form relationships for their own sake. Being a successful leader in the matrix involves building relationships across the organization. Our research shows that successful matrix leaders often tend to be affiliative people who actually enjoy relationships for their own sake. Often these relationships do end up helping the leaders to achieve business goals, but the relationships are typically formed before the business rationale becomes clear. Simply by engaging colleagues in social conversation and thereby building goodwill and rapport, leaders can start to establish the diverse networks that prove so helpful in achieving cross-functional matrix goals.

4. Be resilient. Matrix leaders need to be able to seek out information and unlearn old mindsets. This can take bravery as leaders work their way up the learning curve in unfamiliar territory. Matrix leaders are almost certain to experience some frustration as they try to bring diverse groups and competing agendas together. The daily challenges and setbacks of working in the matrix and achieving alignment are not for the faint of heart. The most successful leaders are those who can stay focused and hold their course despite these challenges. Being resilient, maintaining optimism, seeking out and using constructive feedback to adapt their behavior in order to foster broader innovation – these are all essential precursors for success as a matrix leader.