Matrix management is an organizational structure in which some individuals report to more than one supervisor or leader, relationships described as solid line or dotted line reporting. The project manager works like an expediter or a coordinator. The matrix organization structure was born in the aerospace industry in the U.S to handle sophisticated projects. This gives the team the ability to draw upon diverse skill sets from multiple disciplines, which strengthens the overall project team. Types of Organizational Structure | PM Study Circle. Strong matrix: Companies with strong matrix structures choose project managers for new projects from a pool of people whose only job is to manage projects. In a matrix structure, individuals work across teams and projects as well as within their own department or function. Here, the employee generally works under two bosses. There are three types of matrix organizational structure. It is the equivalent of an adjacency matrix in graph theory, and is used in systems engineering and project management to model the structure of complex systems or processes, in order to perform system analysis, project planning and organization design. Created in the 1970s, this structure combined the best components of these two structures. Though a matrix structure can provide a more efficient use of an organization’s resources, it is not without it’s own set of challenges. Overview. Every organization must have a well-defined organizational structure in order to work efficiently and achieve its goals with fewer risks and obstacles. People are assigned to lead projects or serve as team members based on the projects’ needs rather than on their job descriptions. Within an organization, highly hierarchical structure, fragmented functions, and skills can cause problems that prevent to reach the goals. It's an especially handy system when developing new products  allowing individuals from all different functions to organize under a project manager to create something new and unique. This combination brings flexibility and efficiency while performing tasks. Gantt Chart. Additionally, the matrix structure is composed of both a traditional hierarchy of management, where employees are managed by a functional manager, as well as additional project managers who can manage employees across different … Then it became popular to manage multiple large and complex projects of an organization. Specialized expertise can be available for several different projects: Projects often require a small amount of effort from a person with highly specialized knowledge or skills. In a matrix organization structure, people from different areas of the organization are assigned to lead or work on projects. Because an individual can be on a project for less than 100 percent of his time, he may work on more than one project at a time. A matrix type of organisational structure combines the traditional departments seen in functional structures with project teams. This type of organizational structure provides solutions for conflicts that originate from unclear functions and ill-defined responsibilities of managers. So, I got curious and researched a bit. Organizational structure refers to the way a company or organization is setup. Some employees may become confused about reporting hierarchy. This article discusses matrix organizational structure advantages and disadvantages. 6. This classification depends on the authority and power of the project manager. Because matrix organizational structures have the flexibility of relocating employees when needed. Well-defined roles, responsibilities and reporting hierarchy is key to avoid conflicts. An employee from the … This form is suited for “project-driven” companies such as construction. But from my experience, from the project management perspective, in nether cases the RTM was the best tool to use. Below are some of the disadvantages of the matrix organization structure. An employee may have vertical and horizontal reporting lines. Project managers guide the performance of project activities while people’s direct supervisors (from groups such as finance, manufacturing, and sales) perform administrative tasks like formally appraising people’s performance and approving promotions, salary increases, or requests for … Enterprise Environmental Factors Organizational Process Assets, To Complete Performance Index (TCPI) Examples, Advantages of a Matrix Organization Structure, matrix organizational structure advantages and disadvantages, matrix organizational structure pros and cons, matrix organizational structure vs functional, Human Resources Specialist Job Description & Salary, Conflict Management Techniques in Project Management, Functional Organizational Structure Advantages, Projectized Organizational Structure Advantages, What is Team Building? What are the neccessities of... © 2018-2020 – ProjectCubicle Media. Strong Matrix Structure In balanced matrix organization structure, power and authority are shared between the project manager and the functional managers. In a strong matrix organization structure, the project manager has extensive authority and power and the functional managers have limited roles. A matrix organizational structureis a company structure in which the reporting relationships are set up as a grid, or matrix, rather than in the traditional hierarchy. Understanding Team Culture. More broadly, it may also describe the management of cross-functional, cross-business groups and other work models that do not maintain strict vertical business units or silos grouped by function and geography. Project managers competing for the use of the same resource can result in conflict thus negatively impacting project schedules unless a compromise can be obtained with the functional manager. The matrix organizational structure has had a great influence on project management. Typically, an organizational structure provides a framework for reporting relationship between employees. Employees report both across and up through the organization. They are assigned project team members from various departments, … Therefore the functional managers have authority on the project budget. Matrix Organisational Structure is a combination of functional organisation and project organisation (i.e. The Matrix Organization Structure can deliver this, provided people have the skills to make the matrix work. The matrix organizational or management structure works by grouping employees and resources by function and by product or project. The matrix organization structure is a blend of the projectized organization and the functional organization and tries to blend the best of both worlds. READ MORE on www.strategyex.co.uk. Team members may focus more on their individual assignments and less on the project and its goals: For example, a procurement specialist may be responsible for buying equipment and supplies for all her projects. In... What is Team Building? Before to implement an organizational structure type to a company, the benefits, and limitations of the structure should be analyzed. Cooperation and communication between departments and units are well. This enables to use resources efficiently and prevents losses. In the typical matrix structure, a project manager is assigned from within one of the functional departments in either a part time or full time capacity. It shows all … This classification depends on the authority and power of the project manager. projectized organization structure and the functional organization structure Because for a small company implementing a functional organization structure may be better than implementing a matrix organization structure. As a result of this indirect costs may increase because of the need for double management. You can also use this method for individual tasks to gain better efficiency. 2. Divisional organization structures focus on the products, customers, geographical location, etc. Shared authority and power may cause conflicts between functional managers and the project manager. Project managers guide the performance of project activities while people’s direct supervisors (from groups such as finance, manufacturing, and sales) perform administrative tasks like formally appraising people’s performance and approving promotions, salary increases, or requests for leave. The advantages of a matrix structure include: Individuals can be chosen according to the needs of the project. (adsbygoogle = window.adsbygoogle || []).push({}); Every organization needs a well established organizational structure to reach the organizational goals. It is one of the most popular chart diagrams for project planning and management. Team members may not be familiar with one another’s styles and knowledge: Team members may require some time to become comfortable with one another’s work styles and behaviors. Below are some of the advantages of this organizational structure. The weak matrix organization structure has the characteristics of the functional organizational structure. Balanced Matrix Structure 3. After completion of mobilization tasks, you will turn back to your head office and go on working in the engineering department. Matrix Organisation = Functional Structure + Project Structure). Large and multi-project organizations prefer matrix organizational structures where they can relocate employees whenever and wherever their services are needed. Project (or program) management was used to describe a type of structure which already existed in various uses. Functional organizational structures divide the company into departments such as marketing department, engineering department, sales department, etc. It is usually defined using a hierarchy chart that shows how groups or functions report within the organization. In this article, we discussed matrix organizational structure pros and cons. reaching higher productivity.It has various benefits. Likewise organizations, projects involve many tasks from human resources management to budgeting and scheduling activities. The result was increased organizational complexity. In a weak matrix organization structure, the project manager has a limited role but the functional managers have authority and power. Using a Matrix Structure to Administer Your Project, How to Introduce Your Business in a Letter, Skills and Personal Qualities that Employers Want. 3. Organizations are formed in different structures such as matrix organizational structure, functional organizational structure , composite organization, etc. Here the project managers have the highest authority. It is expensive to maintain the structure. All Rights Reserved. The matrix organizational form is an attempt to combine the advantages of the pure functional structure and the product organizational structure (Kerzner, 2006). Project Organization. A matrix organization is defined as an organization where people have to report to more than one boss. This is a type of organizational structure which facilitates a horizontal flow of skills and informations. A matrix organizational structure is a company structure in which the reporting relationships are established as a matrix. Strong Matrix Structure. Gantt chart is a type of bar chart helps to display project schedule activities. The companies never ask these people to serve as team members. It also offers a way for coordinating organizational activities and routines. A matrix organizational structure allows for the balancing of daily operations with project delivery within an organization. A matrix organization structure is a combination of the functional and divisional organizational structures. Weak Matrix Structure. Strong matrix organizations are closer to a projectized organization. 1. For it to work the business case must be … but a conflict of loyalty that hits you slap bang in the middle of the design. For instance, monitoring and evaluation specialists may not be utilized full-time on a project, but can be fully leveraged by working on multiple projects. Therefore a weak or rigid organizational structure cannot be adequate to bring success all the time. Hope that it will be useful for the pmp aspirants. The matrix evolved to fill a need for an organization capable of dealing with great project size and complexity. Introduction to Organizational Structure of Project Management . Often these project managers form a single organizational unit that reports to a manager of project managers. The Project Management Structures www.pm4dev.com The main advantage of the matrix based organization is the efficient allocation of all resources, especially scarce specialty skills that cannot be fully utilized by only one project. Stakeholders become, in fact, more and more aware and demanding and want quick answers. Likewise, if a company is big and the projects are large and complex, a matrix organization structure will be more effective. In other words, employees have dual reporting relationships - generally to both a functional manager and a product manager. 2. In Projectized Organizational Structure, the whole company is organized by projects rather than functional teams or departments. A matrix environment introduces the following challenges, which the project manager must successfully address: Team members working on multiple projects respond to two or more managers. Don Steward coined the term "design structure matrix" in the 1960s, using the matrices to solve mathematical systems of equations. For this purpose, organizations establish strong, balanced or weak matrix structures depending on the requirements. Leadership Styles in Management Different types of leadership styles exist in organizations. For instance, let’s say that you are an electrical engineer in the engineering department of the head office and your company has a new project in a different region. Once the project is complete, you may choose to dismantle this setup or move it to form a new project. Balanced Matrix Structure How does team building work? Strong Matrix Structure 2. 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