In one of my previous blog post what is Organizational Structure in Project Management? We discussed that every organization is organized in a way that supports in the success of portfolios, programs and projects. In this blog, we’ll understand matrix organizational structure; functional matrix and projectized organizational structure, matrix organizational structure definition, matrix organizational structure advantages and disadvantages in project management.
Table of Contents
- Define Matrix Organization Structure
- What are types of Matrix Organization Structure?
- Advantages of the Matrix Organization Structure
- Disadvantages of the Matrix Organization Structure
Every organizational needs an organizational structure; it basically defines the hierarchy of the company. In simple words, it defines who works for whom and who reports to whom.
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Without this structure, there would be chaos and inefficiency. Now one of the most common form of formal organization is the matrix organization structure.
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The authority of a functional manager flows vertically downwards, and the authority of the project manager flows sideways. Since these authorities flow downward and sideways, this structure is called the matrix organization structure. In a matrix organization structure, employees from one section may report to one boss and the rest may report to another boss.
The matrix organization structure takes the characteristics of both types of organization structures. The matrix structure is a composite of the projectized and the functional organization structures. Here the knowledge, skill, or talent of an employee is shared between the functional department and project management team.
In a matrix structure, some employees usually work under more than one boss (usually two). The first boss will be their functional manager and the other can be a project manager.
The functional manager may look after the functional part of the project; he may decide how to do the work, and may distribute the project work among his subordinates. The project manager will have authority over the administrative part of the project such as what to do, follow-up the schedule, evaluate the performance, etc.
Working in a matrix organization can be challenging because you have a confusing role and you may have to report to two bosses. To avoid confusion and work efficiently in a matrix organization, you must be clear on your role and responsibilities and the work priorities.
The matrix organization structure exists in large and multi-project organizations where they can relocate employees whenever and wherever their services are needed. The matrix structure has the flexibility of relocating the organization’s talent. The employees are considered to be shared resources among the projects and functional units.
The matrix organization structure can be classified into three categories depending on the level of power of the project manager. These categories are as follows:
In strong matrix organizations, most of the power and authority lie with the project manager. The project manager has a full time role, has a full time project management administrative staff under him, and he controls the project budget, decides on timelines and the type of resources needed. The strong matrix structure has a lot of the characteristics of a projectized organization.
In balanced matrix organizations, power and authority are shared between the functional manager and the project managers. Although, the project manager has a full time role, he will have a part time project management administrative staff under him. In this type of structure, both managers control the project budget and work on other key decisions jointly.
In weak matrix organizations, the project manager will have a limited power and authority. He will have a part time role and no administrative staff will report to him. His role will be more like a coordinator or an expediter. Here, the functional manager controls the project budget.
A weak matrix organization structure resembles the characteristics of a functional organization structure.
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There are many benefits of implementing Martix Organizational Structure. Let’s see it below:
- Highly skilled and capable resources can be shared between the functional units and projects, allowing more open communication lines which help in sharing the valuable knowledge within the organization.
- The matrix structure is more dynamic than the functional structure because it allows employees to communicate more readily across the boundaries, creating a good working and cooperative environment which helps in integrating the organization.
- Employees can learn and widen their skills and knowledge areas by participating in different kind of projects. The matrix structure provides a good environment for professionals to learn and grow their career.
- In functional departments employees are very skilled, and project teams can get these highly skilled employees whenever their services are needed.
- Since there is a sense of job security, employees tend to be loyal to the organization and perform well, and hence the efficiency of a matrix organization is higher.
The following are a few disadvantages of the Martix organization structure:
- Employees may have to report to two bosses, which adds confusion and may cause conflict. This usually happens in a balanced matrix organization where both bosses have equal authority and power.
- A conflict may arise between the project manager and the functional manager regarding the authority and power.
- If the priorities are not defined clearly, employees may be confused about their role and responsibility, especially when they are assigned a task which is different from what they were doing.
- If any resource is scarce there might be competition to use it, which may cause hostility within the workplace and could affect the operation.
- In a matrix organization, workload tends to be high. Employees have to do their regular work along with the additional project related work, which exhausts them. It is also possible that the employee may ignore either his functional responsibilities or project management responsibilities.
- A matrix structure is expensive to maintain. Organizations have to pay extra to keep resources because not all resources will be occupied at all times. Some resources are needed only for a short duration.
- There must be close cooperation between the project manager and the functional manager. This will help avoid confusion and conflict.
- There should be well defined and strong communication in all directions. This is important to gain support from executives, managers, supervisors and employees. Organizations must communicate their vision, objective, and goal with their employees.
- There should be a proper and balanced distribution of authority and power between the project manager and the functional manager. Both managers should get the required power and authority. Any imbalance may impact the effectiveness of operations.
- Any conflict between the project manager and the functional manager must be resolved as early as possible, and in private.
- Roles and responsibilities must be clearly documented and communicated to employees to avoid confusion.
A matrix organization is defined as an organization where people have to report to more than one boss. The matrix organization structure is a blend of the projectized organization and the functional organization, and takes the best of both worlds.
In this blog post, we have understood matrix organizational structure; functional matrix and projectized organizational structure, matrix organizational structure definition, matrix organizational structure advantages and disadvantages in project management.
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