Matrix Organization Structure: Advantages and Disadvantages
By Nodir M Ataev
Contents
Contents
Organizational Structure
Types of Organizational Structures
Line Organizations
Line-and-Stuff organizations
Committee Organizations
Matrix Organization: An Outline
Matrix Organization: Advantages
Matrix Organization: Disadvantages
Matrix Organization: Conclusion
References
Bibliography
Organizational Structure
An organization is the result of the organizing process and can be defined as a structured grouping of people working together to achieve organizational objectives.1 Every organization must choose an overall structure that meets its needs best and allows interactions among individuals and departments to attain the its goals.
For a small business, the organizing process is comparatively simple. The owner of a grocery store employs a few people to sell groceries and to take care of the supplies and personally directs business operations. The handling of such a relatively small store is more or less simple and easy.
However, as a company grows the need for organization increases. As a company enlarges its scope of business, it has to hire more employees. Instead of a single bookkeeper, it will have to employ an entire accounting department, rather than one seller the owner will need a number of them. The large number of employees makes it impossible for a single person to control the business. One or other formal type of organization becomes necessary.
To effectively accomplish their goals large organizations use various techniques such as departmentalization, delegation, and others. Departmentalization is the dividing of work activities into units within the organization. This method can be used to effectively run a large organization and has been used in different organizations throughout the world.
Types of Organizational Structures
An organizational structure is a hierarchical concept of subordination of entities that work together and contribute to serve one common aim2. The structure of an organization is usually built in one of a variety of styles, dependent on the organization’s objectives. The structure of an organization will determine the modes in which it shall operate and will perform.
Organizational structure allows the expressed allocation of responsibilities for different functions and processes to different entities. Ordinary description of such entities is as branch, site, department, work groups and single people.
Organizations can be classified into four main types: line, line-and-stuff, committee, and, matrix organizations. The classification is done according to the nature of internal authority relationships of organizations.
Line Organizations
matrix Organization committee
The line organization is the oldest and the simplest organizational structure. This structure is defined by its clear chain of command, with final approval on decisions affecting the operations of the company still coming down from the top. Because the line structure is most often used in small organizations—such as small law firms, hair salons, and small stores—the president or CEO can easily provide information and direction to subordinates, thus allowing decisions to be made quickly.
Line structures by nature are informal and involve few departments, making the organizations highly decentralized. Employees are generally on a first-name basis with the president, who is often available throughout the day to answer questions and to respond to situations as they arise. It is common to see the president or CEO working alongside the subordinates. The line organization is effective in the smallest organization only. The reason is that the manager has total responsibility for a number of activities and cannot be efficient at all of them.
Line-and-Stuff organizations
While the line structure would not be appropriate for larger companies, the line-and-staff structure is applicable because it helps to identify a set of guidelines for the people directly involved in completing the organization's work. This type of structure combines the flow of information from the line structure with the staff departments that service, advise, and support them
Line departments are involved in making decisions regarding the operation of the organization, while staff areas provide specialized support. The line-and-staff organizational structure "is necessary to provide specialized, functional assistance to all managers, to ensure adequate checks and balances, and to maintain accountability for end results"3
An example of a line department might be the production department because it is directly responsible for producing the product. A staff department, on the other hand, has employees who advise and assist—making sure the product is advertised or that the customer service representative's computer is working.
Committee Organizations
In a committee organization, authority and responsibility are in the hands of a group of individuals rather than a single manager. In this type of organization groups of individuals, or committees, make decisions together. This ensures that individuals from diverse departments make more sound decisions. On the other hand, this slows down the decision making process as each member of the committee must agree with the decision.
Matrix Organization: An Outline
A variation of the line-and-staff organizational structure is the matrix structure (matrix organization structure is sometimes called project management structure).
Matrix structures have come about as a result of coordination problems in highly complex industries such as aircraft manufacture4. ............
