A matrix organization has a complicated structure in which the reporting relationships are set up as a matrix – a grid – instead of the traditional vertical hierarchy. Show
Employees in a matrix organization generally report to both a product or project manager as well as a functional manager (department head). The structure facilitates the horizontal flow of information and skills. In a matrix organization, the traditional departments seen in * functional structures combine with project teams. * Functional structure refers to basing a department according to functional areas, such as marketing, IT, research & development (R&D), finance, etc. Matrix management structures are found mainly when there are big projects or product development processes. They draw on employees from a wide range of functional disciplines for assignment to a team – however, they still remain in their respective positions.Matrix is one of several different organizational structures that employers may adopt. In a matrix organization you have 2+ bossesIn a matrix organization structure, all the company’s engineers may be working in one engineering department, reporting to the engineering manager. However, some of those engineers might be assigned different projects, and also report to a project manager. They only do this – also report to the project manager – while they are working on that project. Sometimes, the engineer might have to work under several different managers in order to get his or her job completed. Philips, a Dutch technology company headquartered in Amsterdam, set up matrix management in the 1970s with its managers reporting to both a product division manager as well as a geographical manager. The grid system soon caught on, and several other large multinationals, including Texas Instruments, Hughes Aircraft, General Motors and Caterpillar Tractor started doing the same – setting up reporting along both project and functional lines. According to JSBonline.com, for success in a matrix organization, there are seven key elements. (Image: adapted from jsbonline.com)Organizations may fall somewhere in between the pure matrix and the fully functional. Even basically fundamentally functional organizations sometimes create a special team to handle a crucial project. In today’s world of business, matrix organizations are considerably more common than they used to be forty years ago. Most large complex organizations exist today at some level of matrix management, especially those with several business units and global operations. Example of a matrix organizationImagine you work in an advertising agency as a video producer. You will probably have to report to the media department manager, your functional chain of command boss – the head of your department. However, you will probably also have to report to somebody who is in charge of a specific project for a client – the project manager – he or she is your boss in the project chain of command. The functional manager is responsible for all the technical performance of each employee in his or her department, which in this case is video production. The project manager, on the other hand, is responsible to the overall performance of the product team. He or she is the project’s boss as far as the client is concerned. Edward Whiteacre Jr. is the former Chairman and CEO of General Motors, and former Chairman of the Board and CEO of AT&T Inc. (previously Southwestern Bell Corporation). (Image: pacific.edu/About-Pacific) Advantages of a matrix organizationSupporters of matrix management argue that in this structure, team members are able to share information more readily across task boundaries, which counters the ‘silo’ limitation of functional management. ‘Silo’ refers to the isolated company department, where all reporting and sharing of information occurs only within that department. In a matrix structure, reporting and information sharing goes beyond a department’s boundaries, which allows for specialization that can both increase depth of knowledge and assign people according to project needs. The advantages of having a matrix organization are listed as follows:
Disadvantages of a matrix organization
In most cases, the matrix structure does not replace a traditional functional structure – it sits alongside it. When did the matrix organization emerge?It is hard to trace the exact origins of the matrix management concept. Some say it started in the 1970s with Philips, as mentioned earlier. According to Britannica.com, the term first appeared in the 1960s in the aerospace industry. Aerospace companies that wanted government contracts had to develop charts that showed the structure of the project management team that would be in charge of a contract. The chart explained how this team was related to the overall management structure of the company. Instead of reconfiguring their management systems completely in order to meet the client’s (government’s) requirements, companies decided to create horizontal project units that existed alongside the functional structures – the vertical hierarchies that were already in place. This approach killed two birds with one stone: 1. It fulfilled the goal of the client – a transparent set of resources led by a group manager. 2. The company did not have to change the fundamental functional structure of the whole organization. This Global Integration video explains what a matrix organizational structure is, where they exist, and why they have become considerably more common in today’s global economy. In which organizational structure type does an employee report to two bosses?The definition of a matrix organization structure is where people report formally to more than one manager.
What organizational structure is a workplace format in which employees report to two or more managers rather than one manager overseeing every aspect of a project?A matrix organizational structure is a workplace format in which employees report to two or more managers rather than one manager overseeing every aspect of a project.
What are the 4 types of organizational structures in project management?According to PMI, there are four basic types of organization: Functional, Matrix, Projectized, and Composite.
In which of which organizational structure employees may report to two or more bosses depending on the situation or project in?A matrix structure is a hybrid of the functional and divisional structures. It may involve employees reporting to different bosses depending on their current assignment.
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