Matrix Structure

Matrix Structure • The search for better and faster ways to develop products and meet customer needs led to the matrix structure. • The matrix structure includes both functional and product responsibility. • It is used for a high level of group coordination to respond to changing conditions. • The matrix structure is flat with decentralized authority. Functional employees remain under a functional head, but work under a product manager. • The product manager leads the team whose members are responsible to both functional and product managers. • Role and authority relationships are ambiguous. Control is exerted horizontally via teams. • A matrix is an organic structure.

Matrix Structure CEO

Vice President Engineering

Vice President Sales and Marketing

Vice President Finance

Product A Manager

Product B Manager

Product C Manager

Product D Manager

Two-boss employee

Product Team

Vice President Research and Development

Vice President Purchasing

Matrix Structure • Although both a product team and matrix structure use teams, matrix team members have two bosses and team membership is not fixed. • Advantages of a Matrix Structure 1. Functional barriers and subunit orientation are reduced. 2. Cross-functional communication allows members to learn and develop skills. 3. Employee skills are utilized. 4. Employees are concerned about both cost and quality.

Disadvantages of a Matrix Structure 1. Lack of bureaucratic structure leads to role ambiguity and role conflict. 2. Teams may fight over resources. 3. Members often refuse transfers to stay with peers. 4. Informal hierarchies emerge in response to uncertainty. 5. Unmet expectations lead managers to increase control resulting in a taller, bureaucratic structure.

Multidivisional Matrix Structure • A multidivisional matrix structure provides for more integration between corporate and divisional managers and between divisional managers. • A matrix design can enhance a multidivisional structure when placed at the company’s top to increase integration between corporate and division managers. • Corporate specialists analyze divisional performance and design action plans. • Division heads and corporate executives exchange information and coordinate activities.

Multidivisional Matrix Structure CEO

Senior Vice President Marketing

Automobile Products Division

Personal Computer Division

Consumer Electronics Division

Senior Vice President Finance

Senior Vice President Research and Development

Senior Vice President Materials Management