A matrix structure is a workplace format in which employees report to two or more managers, rather than one manager who oversees each aspect of a project.
Understanding the advantages and disadvantages of a matrix structure can help you determine if this type of structure is right for your company.
Every organization is structured in some way, and that structure is determined by the goals of the organization. The way an organization is structured will provide a standard for operational procedures and routines. It will also determine who participates in what, and which design tools are best for the job at hand.
The matrix organizational structure is often used in project management because it speaks to both the product of the project and the management function that produces it.
Let’s take a closer look at this type of organizational structure to determine its pros and cons in project management.
What is matrix structure?
In principle, a company with a matrix structure includes at least 2 chains of command, usually with project managers in addition to the traditional functional managers.
In this sense, a functional manager heads a particular office or department based on a job function. Think marketing, sales, support, human resources (HR), and more.
A project manager leads a project and may manage staff across a wide range of departments and offices.
In a traditional top-down company structure, everyone fits perfectly into their field.
For example, a sales representative reports to the sales manager, who reports to the head of sales, who reports to the CEO. So it’s a simple, linear chain of command.
However, the matrix organizational structure is a combination of two or more types of organizational structures. In this sense, the matrix organization is the framework that ties these other organizational structures together to provide balance.
Typically, there are two chains of command, where project team members have two heads or managers.
Often, one manager handles functional activities and the other is a more traditional project manager. These roles are fluid and not fixed, as the balance of power between these two types of managers is not defined in organizational terms.
He will employ the best of both structures and management styles to build on strengths and compensate for weaknesses.
In this way, if an organization is working on the production of two products or services at the same time, it can organize both and use this duality to its benefit through the matrix organizational structure.
What is the main purpose of the matrix structure?
One of the biggest advantages of using a matrix organizational structure is that it allows for the sharing of highly skilled resources across functional units and projects.
In addition, communications are open, which helps knowledge move throughout the organization with less obstruction.
Because the matrix structure promotes better communication , as well as making normal boundaries between groups more porous. Which results in more collaboration and an integrated and more dynamic organization.
Likewise, departments have highly qualified people, and these people are available to help the project team if needed. This creates an environment of valuable resources that can provide more flexibility to solve problems without having to look for new resources.
Also, efficiency is better and teams remain loyal because the structure provides a more stable environment where work safety is reinforced.
What are the characteristics of the matrix structure?
A matrix organization is a structure in which there are more than one line of managers. As a result, this means that employees in the organization have more than one boss!
Therefore, the matrix structure is complex, but it helps to achieve the final objective, that is, to achieve greater productivity . As this type of structure has several benefits, it is used in organizations that have several lines of products and services.
After all, it breaks the monotony and gives more flexibility to the organization. Employees work with colleagues from different departments who have experience in different roles.
When different people from different departments work together, it helps solve problems more efficiently. This leads to the overall development of the employees as each of them is exposed to different roles in addition to their main job.
Here employees are assigned a job or project outside their own department for a relatively short period of time.
These teams are made up of people with diverse specialties who have come together and formed a team to achieve a specific goal.
However, there are also some challenges. In the matrix structure, ambiguity can arise if employees are not sure which manager to report to. It also means that employees can be confused about their role and responsibilities.
Also, in the matrix organizational structure, it becomes relatively difficult for the organization to evaluate the employee’s performance in a given project.
When to use the matrix structure?
A matrix organizational structure is most commonly used in companies to distribute resources and workers across multiple operations.
For example, an employee may have a primary manager they report to, as well as one or more project managers they work under.
This type of structure is often useful when skills need to be shared across departments to complete a task, and can allow companies to utilize a wider range of talents and strengths.
Advantages and disadvantages of using the matrix structure
Advantages of matrix structures
There are several benefits of implementing a matrix organizational structure within the workplace. These benefits include:
- Collaboration between different departments
Perhaps the biggest advantage of a matrix structure is that it brings together highly skilled team members from different departments , allowing the organization to capitalize on the resources it already has rather than seeking expertise and recruiting project team members from outside the organization.
- Combines project and functional management structures
The matrix structure combines the project management structure with the functional management structure to increase efficiency, adapt to changing markets and respond more quickly to market demand.
- Enables interdepartmental communication
The matrix structure also allows for better interdepartmental communication and collaboration . By allowing different departments to work together, the matrix structure promotes a more open work environment, ultimately making the organization more dynamic.
- Employees can develop new skill sets
The matrix structure can offer employees the opportunity to strengthen their interpersonal skills , communication skills and new skill sets due to the nature of using more than one manager.
Working outside of a traditional or hierarchical structure can benefit employees by helping them to develop new skill sets and gain valuable experience working across different departments.
- Team members and managers maintain their functional roles
Projects will always continue to come to an end, but project team members and managers can maintain their functional roles throughout the project.
When a project ends, both managers and team members can avoid misconceptions about the security of their work or pursuing new projects, as they can simply assume their functional roles. In addition, team members can also participate in future projects.
Disadvantages of matrix organizational structures
- Managerial roles may not be clearly defined
A common disadvantage of the matrix structure can appear as confusion among managers who are involved with projects that are delineated by the matrix.
As the power dynamic between the functional manager and the project manager may not be as clearly defined within the matrix, confusion can arise about specific managerial roles.
- Team roles may not be clearly defined
Another issue is when team member roles are not clearly defined on the project, or the division of responsibilities between employee functional roles and project roles is not clear.
- The decision-making process can be slowed down
Due to the nature of the matrix involving more than one manager, decisions can sometimes take longer than a traditional structure.
Furthermore, with the integration of multiple managers and team members, decisions that require multiple steps , for example in quality assurance, can be delayed when guided by headquarters.
- Too much work can cause overload
The matrix organization structure can also sometimes lead to work overload for team members, as their project workload often adds up to their regular functional tasks.
Employees may neglect or fail to complete tasks or have their work quality suffer due to time constraints.
- Measuring employee performance can become difficult.
Often when implementing a matrix structure, it can be difficult to measure employee performance when working on a project.
This is, in part, because team members may essentially be performing more than one role, both functionally and tasks within the project.
Finally, with careful planning, clear expectations, and open and effective communication, the matrix organizational structure can be an advantageous method of organizing multiple functions and departments when undertaking a large-scale project.
Differences between the matrix structure and other organizational models
Matrix structure and functional structure
Matrix structure is a type of organizational structure where employees are grouped together by two different operational dimensions.
In contrast, the functional structure divides the organization into specialized functional areas such as production, marketing, and sales for management purposes.
The matrix structure is complex in nature due to the combination of two organizational structures. While, the functional structure is simple and easier to manage.
In this sense, the matrix structure is appropriate for companies that have multiple product categories and undertake multiple projects. The functional structure is particularly suitable for organizations that operate in a single location with a single product category.
Matrix structure and horizontal structure
The horizontal structure is a flat management structure. Organizations with these structures often have few managers with many employees and allow employees to make decisions without needing manager approval.
Providing employees with autonomy often helps employees feel empowered and motivated, increasing their connection to the company and its goals. The horizontal structure also naturally encourages collaboration.
Disadvantages of horizontal organization include workforce reductions that create a loss of experienced managers who often make up a company’s institutional memory.
In addition, the breakdown of specialized business lines reduces the company’s ability to innovate. There may also be a perception that an individual working in a small, flat organization lacks the experience needed to truly excel because the effort is diluted.
Matrix structure and divisional structure
As stated earlier, the matrix structure groups employees into function and product areas. Typically the matrix structure is focused around individual products, product lines or functions.
The divisional structure, on the other hand , is separated into almost independent departments, according to product lines, market or geographic locations. The larger the organization, the more likely it is to have a divisional structure, which is simpler to manage and gives clearer lines of control.
A company may have separate divisions for each product, each market area the company sells in, or each geographic location where operations reside.
The divisional structure allows for greater control, as each employee reports only to the structure in which they are located. In a matrix structure, the employee can report to two different authorities, which allows for greater utilization but a more complex operation.
The structure used also depends on the size of the organization. Companies that are spread across the world are likely to have local control, which lends itself to a divisional approach.
A company that is located in a single area can work under a matrix structure. The further away the lines of communication and locus of control are, the less likely it is that the matrix structure will be used.
What is the difference between strong and weak matrix structure?
The matrix structure is a hybrid of functional and projected organizational structures . This is the structure that we are going to analyze in this lesson.
There are three types of matrix organizations characterized by the distribution of influence and authority between the functional manager and the project manager.
The three structures listed in order of increasing influence and authority are the weak matrix, the balanced matrix, and the strong matrix. All these structures can coexist in an organization creating a composite organization.
An organizational structure establishes reporting hierarchies; the level of authority; and the distribution of roles, responsibilities and work. The organizational structure has an impact on the project manager’s authority and influence.
The balance of power can be tilted in any direction by changing any one or any combination of the following three factors:
- The management relationship – The levels to which the project and functional managers involved report, and the support they receive from top management.
- The physical relationship – The physical distances between the various people involved in the project.
- The time spent on the project – The time spent on the project by the respective managers.
These three factors can be used to describe whether the matrix is strong or weak. The strong matrix is one in which the balance of power is definitely on the side of project management.
A weak matrix has been described by project managers as one where the balance of power tilts decisively in the direction of line or functional management.
Many organizations, therefore, for various reasons, including an inability to make the two-boss system work, have modified the matrix, shifting the balance of power.
The matrix falls in the middle of the continuum, and can range from very weak to very strong, depending on the relative balance of power.
How to apply a matrix structure in your company?
If you determine that a matrix organizational structure is right for your company, there are several ways to increase the success of this structure .
The following tips can be used to maximize the effectiveness of a matrix structure within your organization.
Have good knowledge of the organization chart of the company
An organizational chart is a useful tool that companies can use to display their company’s structure. Presented in the form of a flow diagram, the chart helps to show the relationships between different departments and employees.
Maybe you need a clear visual aid to communicate your business structure to new employees, or there’s some confusion about who is reporting to whom.
The org chart can be used as a management tool to improve team performance as well as for planning purposes or simply as a visual staffing director.
As such, each type of org chart is designed to correspond to a specific company structure, so it is important to choose the right type that best suits your own business.
Make a mapping of leadership profiles present in this organization chart
A well-presented org chart can improve clarity and communication for a company, helping to show clear lines of authority and each employee’s position within the company.
When employers have a clear view of where everyone fits in the organization and what roles they play, it will be much easier to see which areas of the company need to change as well.
Whether merging two teams into one or hiring more staff, moves can be clearly mapped beforehand using the graph, allowing you to more accurately predict their success or failure.
In addition, it is possible to identify which of the main leadership acts and activities identify the leadership profiles, as well as the actions that absorb leaders’ time but add little or no value.
Empower the team according to the new structure
In its strictest definition, a matrix organization structure is where people have more than one boss. However, there are a variety of management forms and matrix structures.
It is essential to have a clear definition of the matrix team in order to focus on what factors you need to develop for matrix success. Depending on that, you may require a different mix of skills in both leadership and collaboration.
Matrix team leaders need to exert influence without authority and deliver results without having direct control over the resources they need. Additionally, matrix team members need to learn how to collaborate with colleagues across distance, cultures, and other barriers.
Headquarters team members often suffer from the problem of divided loyalty, where they have multiple teams and functional objectives that compete for their time and attention, have multiple bosses, and often work on multiple teams at the same time.
For some matrix team members, this may be the first time they are given accountability for outcomes that are broader than the achievement of their functional goals.
Clearly establish the company’s new organization chart to employees
The last step is to clearly establish the company’s new organization chart for employees. After all, this type of structure is very different from the usual one. The biggest difference is that the staff is working for two bosses.
Conclusion
The matrix organizational structure has had a great influence on project management. The matrix evolved to fill a need for an organization capable of handling large size and complexity of projects.
The result was increased organizational complexity. However, it has added a lot to the versatility and effectiveness of project management .
The matrix has allowed project management to be effective not only for very large projects, but also for small projects, and has been very valuable for solving multidisciplinary problems.
The organizational form of the matrix is only desirable if there is a real need for its complexity. There are many reasons why the matrix will not work, but failure to lay the groundwork and fully prepare the organization is the main reason for failure.
The matrix will work and result in much greater project productivity if top management is supportive and if functional management and project staff accept the matrix as a way of working.
