The Matrix System at Work - Independent Evaluation Group - World ...

Appendix A
Matrix Management and Organization of the
World Bank in Historical Perspective
1. This Appendix discusses what a matrix organization is, the history of
organizational arrangements at the World Bank, and the role of formal and informal
incentives for technical quality and client orientation.
Matrix Organizations and the World Bank
2. Matrix organizations are characterized by their managerial arrangements, which
are assigned to functional and operational units. Individuals in matrix organizations
are grouped by functions—for instance engineers in a construction company or
sector experts at a development bank—and report to a functional manager. They are
then identified for particular tasks delivered to a client—to carry through the
example, the developer of an office building or a government implementing a
project or reform program—which is overseen by an operational manager.
Individuals thus have dual reporting lines, accountable to both the functional and
operational managers. The purpose of this arrangement is to allow for better
information sharing across task boundaries, better customization of services to the
needs of clients, and better management of career progression in particular subject
areas.
3. The World Bank is organized geographically. The Bank’s country units are
operational, serving as the face of the institution to its clients. The Bank’s sector units
are functional, and manage sector-based tasks to be delivered to clients. To avoid
confusion with other uses of terms “operations” and “functions” at the Bank, the
evaluation sometimes refers to country units as client groups rather than operational
units and to sector units as product groups rather than functional units.
4. The World Bank’s current organization consists of several layers of matrices. The
“regional matrix” refers to the relationship of country director-controlled country
management units (CMUs), which are responsible for managing relationships with
country counterparts and packaging a coherent group of products and services that
will contribute to country-level development results; and sector manager-controlled
sector management units (SMUs), which consist of technical experts who manage
individual lending and non-lending tasks. CMUs are client groups and SMUs are
product groups. Each of the six regional vice presidential units (VPUs) is responsible
for the functioning of its own regional matrix. Staff based in SMUs are accountable
both to their own sector manager who controls their performance evaluation and
compensation, and to the country director who typically controls the final sign-off
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