Introduction to Matrix Management

A leader is responsible to empower his people and get the best out of them. Yet an organisational structure can either help or hamper performance. Worst, it can make or break success.

Looking at the fast-changing world of the global economy, whatsoever slows up and obstructs decision-making is a challenge. Hierarchical management is rather unattractive and functional silos are unlikable. Instead, employees desire to create teams equipped with flexibility, cooperation and coordination.

Recognising that companies have both vertical and horizontal chains of command, the matrix model is created. The concept of this principle lies in the ability to manage the collaboration of people across various functions and achieve strategic objectives through key projects.

Consider this scenario:

Ian is a sales executive of a company. His role is to sell a new product under the supervision of a product manager. The manager is expert about the product and she is accountable to coordinate the people across the organisation, making sure the product is achieved.

Moreover, Ian also reports to the sales manager who oversees his overall performance, monitors his pay and benefits and guides his personal development.

Complicated it may seem but this set-up is common to companies that seek to maximise the effect of expert product managers, without compromising the function of the staffing overhead in control of the organisation. This is a successful approach to management known as Matrix Management.

Matrix Management Defined

Matrix management is a type of organisational management wherein employees of similar skills are shared for work assignments. Simply stated, it is a structure in which the workforce reports to multiple managers of different roles.

For example, a team of engineers work under the supervision of their department head, which is the engineering manager. However, the same people from the engineering department may be assigned to other projects where they report to the project manager. Thus, while working on a designated project, each engineer has to work under various managers to accomplish the job.

Historical Background

Although some critics say that matrix management was first adopted in the Second World War, its origins can be traced more reliably to the US space programme of the 1960’s when President Kennedy has drawn his vision of putting a man on the moon. In order to accomplish the objective, NASA revolutionised its approach on the project leading to the consequent birth of ?matrix organisation?. This strategic method facilitated the energy, creativity and decision-making to triumph the grand vision.

In the 1970’s, matrix organisation received huge attention as the only new form of organisation in the twentieth century. In fact it was applied by Digital Equipment, Xerox, and Citibank. Despite its initial success, the enthusiasm of corporations with regards to matrix organisation declined in the 1980’s, largely because it was complex.

Furthermore, the drive for motivating people to work creatively and flexibly has only strengthened. And by the 1990’s, the evolution of matrix management geared towards creation and empowerment of virtual teams that focused on customer service and speedy delivery.

Although all forms of matrix has loopholes and flaws, research says that until today, matrix management is still the leading approach used by companies to achieve organisational goals.

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Outsourcing

Are you ready to outsource? Do you even need to outsource? We’ll help you answer those and other questions regarding outsourcing and your company.

Once we’ve determined that outsourcing will render your organisation more focused on your core competencies, more cost-effective, and more flexible, we’ll offer you the full spectrum of our services. Our specialists can assist you in every stage of the entire outsourcing life-cycle.

Starting from evaluating what can be outsourced, through finding the right outsourcing service provider, building the contract and agreements, getting everything in place, and managing the outsourcing relationship – we’ll be with you every step of the way.

Learn more about some of the outsourcing services we offer:

Outsourcing Contracts and Agreements

When an outsourcing project fails, both customer and service provider are quick to put the blame on the other party. But in most cases, the actual culprit was really just sitting there since day one – a poorly planned and implemented agreement.

We understand how costly and disruptive a failed outsourcing project can be for your business. That is why we put utmost attention to each contract and SLA (Service Level Agreement) that our customers enter into. This always reduces the likelihood of having unmet expectations, one of the major reasons why some outsourcing relationships fail.

We make sure that each agreement is fair, not only for our customers but also for the service providers themselves. Why? Because a disadvantaged provider will most likely end up delivering poor service as an offshoot of efforts to improve its profitability and ROI.

To accomplish this, we’ll thoroughly assess the infrastructure, resources, and expertise of your potential service provider to ensure they have the capability to meet your expectations. We’ll also make sure that their expectations are realistic and clear to you as well.

Here’s what you can expect from us when we start managing your outsourcing contracts and agreements:

  • A thorough assessment of your specific needs and the service provider’s profile to determine whether you have the right match before proceeding with any agreement.
  • Professional assistance when the time comes for you to discuss the scope of work, expected service levels, and when negotiating for appropriate pricing. We’ll also help you set up provisions for possible changes in the scope later on.
  • Expert counsel during drafting and finalisation of the contract and Service Level Agreements. Whenever applicable, we’ll help you propose penalties whenever service levels are not met and rewards when they are exceeded.
  • Regular reviews to determine whether everything agreed upon in the past, like pricing and service levels, are still realistic or competitive enough in view of current technological advancements and the prevailing social and economic environment.
  • Mediation expertise whenever the outsourcing project appears to be falling apart. We’ll work with you and the service provider to resolve conflicts and avoid the expensive exercise of having to terminate the contract. But if the best solution is to part ways, we’ll make sure you make an exit with the least disruption, missed opportunities and financial loss.

Application Outsourcing

I’m sure you’ve come to realise that to gain competitive advantage these days, you really need to invest in IT applications.

There are applications for enhancing your customer relationships, speeding up production, streamlining processes, advancing collaboration, protecting your systems from malware and many more. Selecting the right application, testing it, implementing it into your system, and then managing it can deviate resources which would have otherwise been used in other areas to build business value, increase profits, and enhance innovation.

Wouldn’t it be nice to unload yourself of the management processes which usually accompany IT applications? Actually, you can – through application outsourcing. Application outsourcing providers possess the expertise to either partially or fully assume responsibility of your IT applications.

Our job is to see to it that you link up with the provider who can best answer your needs. The overall proficiency of these providers spans both proprietary and opensource solutions, allowing them to cater to a wide range of preferences and budgetary limits. At the very least, they can provide professional support for well established applications.

If needed, they can develop applications for your organisation, taking charge of every step in the system development life-cycle: starting from system initiation, requirements analysis, through design, construction, acceptance and eventually to implementation.

Here are some of the benefits you can enjoy once we start managing your application outsourcing initiatives:

  • Freedom from time-consuming tasks such as installations, upgrades, configurations and repairs.
  • Reduced total cost of ownership (TCO).
  • 24/7 support from well-trained personnel. This can substantially cut downtimes caused by inexperienced troubleshooting.
  • The option to have your applications housed in more secure and reliable environments with much higher availability and much lower planned/unplanned downtimes.
  • Dedicated specialists who can focus on providing better regulatory compliance and risk mitigation initiatives.

Infrastructure Outsourcing

Keeping up with the competition nowadays usually requires technological advancements as well as the capability to manage and maintain the infrastructure that has to support them. These undertakings can suck your resources dry.

If you’re looking to reduce costs even while improving the performance of your networks, servers, databases, firewalls, desktops and mobile devices, you might want to consider IT infrastructure outsourcing among your top options. Infrastructure outsourcing service providers have the resources dedicated to a stable, secure, scalable and always available IT infrastructure.

Typical service provider facilities include data centrers equipped with high-speed networks, reliable power, dependable security, as well as provisions for upgrades, consolidation, disaster recovery, or even business continuity.

These providers employ specialists and staff who can manage and maintain all of these for you. While your provider juggles your core IT-related tasks, you can keep your eye on the ball and refocus on your company’s business goals.

Here are some of the benefits you can enjoy out of infrastructure outsourcing:

  • Freedom from time-consuming tasks such as installations, upgrades, configurations and repairs.
  • Since service providers, who are expected to have better horizontal and vertical scalability, will deal with the technological intricacies, your company’s strategic development initiatives can proceed unhampered.
  • Greatly reduced electricity expenses as a result of consolidation.
  • Easier, faster, cheaper, and more reliable disaster-recovery solutions through virtualisation.
  • Lesser risks of disruptions caused by power outages, cyber attacks, or Internet connection downtimes.

Business Process Outsourcing

With the sheer number of business processes your company has to attend to, it wouldn’t be surprising if you rarely have room to innovate.

Through business process outsourcing, we can free a considerable part of your financial and manpower resources which are currently focused on routine activities. With more resources to drive innovative initiatives, you’ll be able to accelerate production, improve customer service, enhance overall business value, and arrive at a stronger bottom line.

Some of the business processes that may be outsourced include data entry, finance and accounting, form processing, procurement, and HR, among others. If you’re interested in finding answers to the what, how, who, and where of BPO, specific to your organisation, we’ll be happy to enlighten you.

Here are some of the benefits you can enjoy once we start managing your BPO initiatives:

  • Professional guidance to ensure that your BPO undertakings will really result in substantial savings and significant improvements to your organisation’s business value.
  • Careful monitoring of service levels to ensure faster turnaround, accurate data, and high quality outputs.
  • Expert evaluation of information handling processes to guarantee full confidentiality.
  • Professional and unbiased management dedicated to establishing a strong, reliable, and fruitful relationship between you and your provider.
Shared Services ? Are They A Good Idea

Things happen fast in business and we need to stay on top. It does not seem long ago that some enterprises were still hands-on traders or artisans with a few youngsters to help out. People like that did not do admin and their accounting was a matter of making sure there was enough money in the jar.

When Wal-Mart’s Sam Walton took over his first shop in 1945 things had moved on from there, although he did still deal directly with his customers. When he died his legacy was 380,000 jobs, and a business larger than most economies. So there?s plenty we can learn from how he grew his business.

One of Sam?s secrets was his capacity to centralise what needed gathering together, while empowering store managers to think independently when it came to local conditions. His regional warehouses had individual outlets clustered around them within one day?s drive each. This shared service eliminated 90% of safety stock and released capital for expansion.

Wal-Mart took sharing services a step further in February 2006, when it centralised accounts payable, accounts receivable, general accounting and human resources administration at Wal-Mart Stores and Sam?s Clubs in the U.S. and Puerto Rico. The objective was to bring costs down, while allowing local managers more time to focus on their business plans and other initiatives. As a further spin-off, Wal-Mart was able to integrate its data on a single SAP platform and eliminate significant roadblocks.

This is an excellent example of sharing services by creating own centres of excellence.? Of course, this is not the only business possibility. Other corporates have successfully completely outsourced their support activities, and Wal-Mart has no doubt had a variety of similar offers too. But, is the Wal-Mart picture entirely rosy, or is there a catch?

The Association of Chartered Certified Accountants has indicated that top talent may be the loser globally. This is because the Wal-Mart model removes many challenges through standardisation, and offers less scope for internal promotion as a result. Language and cultural differences may also have a long-term detrimental effect on the way the departments work well together.

Local outsourcing ? this is the business model where several firms engage a shared service provider independently- may hence prove to be a more malleable option for smaller companies. It often makes more sense to hunt down made-to-order services. Offerings such as the professional support we offer on this site.

Energy Cooperation Mechanisms in the EU

While the original mission of the European Union was to bring countries together to prevent future wars, this has spun out into a variety of other cooperative mechanisms its founders may never have dreamed of. Take energy for example, where the European Energy Directive puts energy cooperation mechanisms in place to help member states achieve the collective goal.

This inter-connectivity is essential because countries have different opportunities. For example, some may easily meet their renewable targets with an abundance of suitable rivers, while others may have a more regular supply of sunshine. To capitalise on these opportunities the EU created an internal energy market to make it easier for countries to work together and achieve their goals in cost-effective ways. The three major mechanisms are

  • Joint Projects
  • Statistical Transfers
  • Joint Support Schemes

Joint Projects

The simplest form is where two member states co-fund a power generation, heating or cooling scheme and share the benefits. This could be anything from a hydro project on their common border to co-developing bio-fuel technology. They do not necessarily share the benefits, but they do share the renewable energy credits that flow from it.

An EU country may also enter into a joint project with a non-EU nation, and claim a portion of the credit, provided the project generates electricity and this physically flows into the union.

Statistical Transfers

A statistical transfer occurs when one member state has an abundance of renewable energy opportunities such that it can readily meet its targets, and has surplus credits it wishes to exchange for cash. It ?sells? these through the EU accounting system to a country willing to pay for the assistance.

This aspect of the cooperative mechanism provides an incentive for member states to exceed their targets. It also controls costs, because the receiver has the opportunity to avoid more expensive capital outlays.

Joint Support Schemes

In the case of joint support schemes, two or more member countries combine efforts to encourage renewable energy / heating / cooling systems in their respective territories. This concept is not yet fully explored. It might for example include common feed-in tariffs / premiums or common certificate trading and quota systems.

Conclusion

A common thread runs through these three cooperative mechanisms and there are close interlinks. The question in ecoVaro?s mind is the extent to which the system will evolve from statistical support systems, towards full open engagement.

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