Matrix - Creating Opportunity

Matrix Ltd, one of Israel’s largest computer companies, employs thousands of workers in a range of fields related to the computerization world. The company was founded in 2001 following the merger of the four companies from the Formula Group. On the day of its founding the company hired 700 employees. Since then it has grown by acquiring other companies, most notably John Bryce Training and New Applicom, and through natural growth as well.
We spoke with Yael Fradkin-Mutzafi, vice president of human resources, about the structure of the company, its development and the type of employee management it practices.

Matrix is involved in various fields related to the world of computerization. What are the primary business systems it’s comprised of?
Yael Fradkin-Mutzafi: The company’s primary departments consist of the Training Department, better known under the label John Bryce Training, and which includes Talpiot, a project that employs charedi women at service centers; the Technologies Department, which executes technological projects; and the ERP Department. Each department employs hundreds of workers. Hundreds of workers are also employed at client sites in activity we refer to as PS – professional services. Hundreds of other workers are employed in other activities, such as hardware sales and distributing software products whose manufacturers we represent in Israel.

Does this mean Matrix is a sort of umbrella organization for different work groups that are essentially independent? For instance, many people see John Bryce Training as a separate company. Not all of its customers know it belongs to Matrix.
Although Matrix has numerous work environments, they are an integral part of the company. Each department has independence, of course, because this is also part of the company’s organizational culture. Keeping the name John Bryce is a special case, because when we acquired the company it was already a known label that would have been a shame to forfeit. But John Bryce is not a subsidiary either, but a department within the company, an inseparable part of Matrix.

And it preserved the organizational cultural it had prior to the acquisition and it’s also located at their facility, which is not a part of the Matrix offices.
Yes, and that’s fine. There are also employees who belong to other departments who don’t work out of Matrix’ offices. Many of them work at the client site rather than here. Every work environment at Matrix has characteristics that define its organizational culture.

How was the name Matrix selected?
When it was founded we put thought into the company label and giving it a nice name. We set up think tanks among the workers and decided a drawing would be held among all those who sent suggestions. Of course those who recommended the winning name were promised a special prize.

Hundreds of suggestions came in and the name Shavit (the Hebrew word for “comet”) was chosen, which suggests speed, and also contains IT. But Motti [Matrix CEO Motti Gutman] wasn’t at ease with it. He said it sounded like an oven company [Israel used to have an oven manufacturer called Shavit] and in English, when broken into two words it didn’t sound very endearing. Motti, who had just seen the movie “Matrix”, called the employees in for a meeting and said he had decided on the name Matrix. Later it was learned two other employees had suggested the name earlier, but it hadn’t been accepted at the time. Obviously they received the prize – a trip abroad. 

The company’s primary growth is based on mergers and acquisitions. Isn’t that problematic?
Matrix has gone through two main mergers. One in its first year and the second in 2003, when a series of mergers almost doubled its size. There are simple mergers and there are complex mergers. If you merge activity that continues to take place at the company independently, then the merger is not really problematic. On the other hand, if you want to transform two systems into one, that’s another story.

Let’s take, as an example, our training department. In order to set up the training department in 2003 we acquired not only John Bryce Training, but also the Sivan Computer School. To merge the two companies into a single training unit was a complex endeavor because one company was assimilated into another. All of the systems merged. But when a special organization like this becomes a part of Matrix, a significant portion of its systems continues to operate as before. True, there are points of overlap with Matrix. Redundancy and other issues have to be neutralized. But the change is much less drastic.

It also depends on how you look at a merger. What is the main reason for it? If the main goal is to reduce costs and eliminate redundancy, then the changes are more drastic. But this goal is secondary to us. The primary importance of the merger is business leveraging. We take a look at how the new synergy leverages the business. How it ties in with other business the company is involved in. How it advances them and how they advance its business dealings. Merging just to reduce costs does not justify the investment and the risk the merger could fail.

Doesn’t pursuing numerous activities in various fields and granting independence to the departments create a situation in which the employee identifies more with the department in which he works than the parent company, Matrix?
Of course people identify to a certain extent with the department, but they identify with the company, too. We do a lot of joint activities that cross over into different departments. One of the main things we stress is related to the training done at the organization. This is a field in which we have a lot of added value and therefore instead of giving workers regular material benefits, we allow them to learn and develop. Not professional learning related to the job – that kind of learning is under the unit manager’s responsibility – but rather learning related to the worker’s personal development. Elective studies he can take part in according to his own preferences. This activity is known as Matrix University, which emphasizes the importance of personal and professional enrichment.

What fields of study are available at the “university?” 
A variety of fields. Based on a preliminary survey, we prepare an annual training program open to all. Every worker who wants to study can enroll. These may be courses in management professions, courses to acquire abilities such as assertiveness or a bridging course in which the worker’s family members can also take part. It might also be a series of meetings called Tea and Sympathy, in which one learns how to be a better parent or how to manage one’s overdraft.

Of course there are also courses in computers. For example, we allow workers to take a systems analysis course. This is a long course that provides a profession. It’s not free, but it’s available at a significantly reduced price – 25% of the full price.

To what extent do the workers take advantage of studying under these conditions?
Every year hundreds of employees opt to take part in training activities. The courses are held in the afternoon and high-tech work is not easy anyway. People also have familial obligations, so it’s not feasible for everyone. But our surveys show the employees are very happy with the “university.”

What is the turnover rate at Matrix?
We recruit hundreds of employees every year. Obviously turnover varies from one department to the next. For instance, naturally the turnover rate is higher among PS workers – the workers at the client site.

That’s to be expected because they’re more isolated from the company.
Sometimes it’s part of the deal made with the customer. It’s arranged in advance with the client that at the end of the year the worker turns into their employee.

That’s not really outsourcing, although the term is generally used to describe such activities.
That’s correct. Most of the activity through this method is done in such a way that although our workers are located at the client site, the work is run by the client. [In outsourcing the work is managed by the provider, which is a substantial difference.]

That distances these employees from the company even more.
The challenge that stands before those who manage workers through this method or through outsourcing is similar to that of one who takes care of children whose parents are separated. There is somebody who is constantly with them and always in contact with them, i.e. the client; and there is somebody who shows up twice a week and has to forge trust and closeness – that’s us. We have to create added value beyond the pay slip, added value that includes identifying with the company.

How do you go about fostering identification with Matrix?
Through a variety of activities. Let me give you an example of one such activity that began last year and fosters identification and contact with all company employees. It’s called Mad Lead and it goes like this: Once a month all employees receive information on the company’s endeavors. The employees are also asked to pass on information that comes to them and can be relevant for Matrix deals. Open information, of course, like the kind that can come up at a Friday night party. All who pass on such information take part in a drawing and 10 weekend getaways are awarded. If the lead takes shape the employee receives a grant of several thousand shekels. And all those whose leads took shape during the course of the year take part in a drawing in which the winners get a weekend abroad. In special cases the employee is awarded the CEO’s Prize and a special bonus. This week, for instance, we are giving out the CEO’s Prize and a sum of tens of thousands of shekels to an employee who found out one of the banks was looking for a CRM system. We took part in the tender, bid on the sale of a system and won. Over 100 workers benefit each year, one way or another, from one of the bonuses related to Mad Lead.

It stands to reason that activities like Matrix University and Mad Lead strengthen the bond between the employees and the company.
We believe they help us hold onto workers. People generally want to belong and identify, to be part of something. But on the other hand, there are also workers for whom this is less important to them and they see the company as just a pay slip. The more we find ways to forge connections the more workers will lean toward identifying and belonging, but there will always be those whose isolationist approach won’t change.

How would you describe Matrix’ organizational culture?
It’s not a hierarchical culture, but of interaction at eye level. The employees have a lot of access to the management. The relations are informal, not stiff. For a large company, Matrix does not have a lot of regulations. Partly because quick reaction time is important to us. This ties in with the importance we attach to providing the customer quick, quality service.

That’s not hackneyed? Who doesn’t attach importance to that today?
It’s not something that goes without saying. There might be a company that stressed that its central added value is the fabulous product it has to offer. At Matrix it’s the service and the attention given to the client. We are distinguished by our good ties with the clients.


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