Forced Matrix Compensation Plans

A forced matrix compensation plan, or matrix compensation plan, operates much like a unilevel plan does, but with one main difference. Each distributor can only sponsor a certain number of frontline distributors. Any additional distributors must be placed further down in their organization – such as their second level – and placed under another distributor.

Forced matrix compensation plans are typically described by two numbers: the width times the depth. This means a 3 x 8 matrix allows you to sponsor 3 frontline distributors, and pays 8 levels deep. Any distributors that you sponsor beyond your first 3 must be placed underneath others in the matrix. A 5 x 7 matrix is 5 wide (front line) and 7 levels deep. On paper, a forced matrix comp plan looks like a “perfect” example of a unilevel compensation plan. Here is what a completely full 3 x 5 matrix looks like:

Forced Matrix Compensation Plan

Advantages of a Forced Matrix

Limiting the number of frontline distributors causes a couple of important changes. First, there is less emphasis on recruiting a large number of people. Rather, you recruit a certain number, and then focus your efforts on helping your downline sponsor more distributors. The matrix comp plan encourages more teamwork than a unilevel comp plan. The narrower and deeper the matrix is, the more this effect is felt. For example, a 3 x 10 matrix puts more emphasis on teamwork than a 6 x 6 matrix does.

Second, since some people will sponsor more than the maximum number of distributors, the concept of spillover comes into play. In a 3 x 8 matrix, you can only have 3 distributors on your frontline. The fourth distributor that you sponsor will spill over into the matrix, and be placed under one of your frontline distributors. Spillover is important in narrow width plans, such as a 3 x 8 matrix, but much less important in a wide width plan, such as a 5 x 5 matrix.

Disadvantages of a Forced Matrix

One drawback of the matrix compensation plan is that most plans require you to fill your front line of distributors before you build under anyone. If your first 2 recruits are local friends or family members, it would be great if you could place them one under another so everyone can work together to build that leg – building underneath the person at the bottom. However, you can’t do that most of the time, although some plans allow sponsor placement. Without sponsor placement, they would be sideline to each other and would be competing instead of collaborating.

Another disadvantage occurs when distributors drop out. If they haven’t sponsored anyone, then you can just start building again at that spot. However, if they have sponsored other reps, their vacancy now creates a “hole” in the matrix that you can’t plug. This is a position for which you can never get paid. But there’s a catch. Some matrix plans feature compression, which will pull one (or more) reps up from below to fill the hole. Now your matrix is once again full – or at least empty at the bottom where new reps can join.

Lastly, like a unilevel compensation plan, the forced matrix limits the depth on which you are paid. Everybody knows that a significant portion of a mature team will be below the bottom level in your matrix.

To Succeed in a Forced Matrix

Maximizing a forced matrix compensation plan comes down to the details. In theory, the plan looks perfect. In reality, things can get out of whack if the plan is poorly designed. Look for a plan that is fully compressed so it eliminates the holes when reps drop out. Avoid narrow width plans (such as 3 wide) because they tend to feature too much spillover from the upline, which gives the heavy hitters an advantage over most other reps (same issue as in a binary compensation plan, discussed next.) Lastly, look for a plan that requires a certain level of personal building (either volume or sponsoring) from your own efforts (excluding spillover) in order to avoid attracting the “welfare minded” distributors who rely on spillover.

Next: Binary Compensation Plans