Dotted Line Reporting is a product of hybrid reporting structures, where someone is given an additional indirect manager to report into, in addition to their original direct reporting line. A person can have humorous dotted lines in addition to their core reporting line and businesses utilize this model to often encourage deeper cross-functional/geographical alignments within a larger business. Assigning additional stakeholders ensures that multiple initiatives can be executed.
When executed correctly, dotted lines can do wonders for cross-functional efficiency and business alignment. Having one person report into several stakeholders ensures that each stakeholder is aware of where the organization is moving at pace, and where additional attention needs to be devoted.
Each additional dotted line creates more red tape, as it creates an additional decision-maker who needs to be informed of and approve each new business decision. Some organizations where management is improperly aligned may experience conflicting decision-making, creating massive slowdowns in normal business processes. On the employee satisfaction front, employees may feel pulled in too many directions and/or unsure of where to focus their time.
The two areas where companies will typically use dotted-line reporting is to connect multiple geographies and/or product lines to a specific functional area. For example, a Head of US Operations in a global company may have their direct line into the US business, but a dotted line into the global operations function in order to stay connected to enterprise-wide initiatives and best practices.