Matrix Organizational Structure

Matrix Organizational Structure

The matrix organizational structure is one of the primary forms of structures that are adopted by organizations to carry forth their work. In this, a structure is adopted that groups employees according to the functions and products. The following sections takes you into a detailed explanation of what a matrix organizational structure is and what its varied characteristics are.
Every organization needs a structure to carry forth the functions of a company effectively. This aims at bringing order and giving the organizational culture a structured feel, so that effective functioning becomes possible. Every organizational structure will have certain activities and functions that it needs to carry forth in order to achieve the goals that are set forth by the organization. These activities will involve things like supervision, allocation of tasks, and coordination of these activities.

There are several different types of structures that can be adopted by organizations depending on what their objectives are, and each structure will determine how an organization operates. An organizational structure means that any organization needs a pattern of hierarchy so that there is proper distribution of functions and duties, and the different units can work in unison towards a final goal. It is this need that has been responsible for the formation of several types of organizational structures in companies. In the following sections, we will focus on the matrix organizational structure.


A matrix organizational structure combines two types of organizational structures namely the product organizational structure and the pure functional structure to create a unique blend of work environment. This structure and design is most useful for when the assignments are project driven, because in this, several professionals with distinct functioning powers will be hired to carry forth the functions. To give an example of this form of structure -- at a given point, the organization might be producing 3 different products. Depending on the type of product that is being designed and the kind of expertise that is required for each product, the teams will be decided. This means that every team will have the same functions and stages, but the people will be chosen depending on their skills and how they can be best utilized for the function at hand.

A Pictorial Representation

Matrix organizational structure
A typical matrix organizational structure

This graphic draws forth a typical matrix organizational structure. In this organization, for example, there are three different products that are being produced. In accordance to that, 3 teams have been drawn forth which consist of a business analyst, a developer and a tester each (these will change from one organization to the other). Each of these teams is headed by a product manager and the team members have to report to him on a daily basis. Along with the product manager, there are three different managers as well, namely, the business analyst manager, the development manager and the quality assurance manager. The team, or the individual members in the team may have to report to their direct manager from time to time -- the business analyst to the business analyst manager, the developer to the development manager, and the tester to the quality assurance manager. Along with the team reporting to these managers, the product manager of each team will have to directly report to the three managers at regular intervals as well. And to complete these settings, these three managers have to directly report to the CEO of the organization. The functions of the organization will be carried forth in this order and hierarchy. In this form of structure, information sharing becomes mandatory for effective and smooth functioning.


Due to the unique makeup of this structure, there are several advantages that can be observed. Here are some of these:
  • A specialized crew can be chosen on the merits of their work and the functions that they carry forth.
  • The needs of the project is the sole criteria for hiring of professionals. Thus allowing for more chances of success.
  • Since the key people that are hired as a part of one team also work under other teams, it becomes a cost-effective affair because the project cost is minimized.
  • The structure is so well-balanced that there is a proper balance between cost, time and performance.
  • Less conflicts are likely to take place and even if they do, they are easily solved because of the hierarchical setup.
  • The project manager is solely responsible for making sure that the project is completed on time and within the allotted budget. Therefore other than the obvious problems that do arise, there is less chance of external factors affecting the project.
  • There is more chance of success because a lot of different thinking forces are working on the project, and therefore the stress, authority, and problem-solving abilities become stronger.

Even though there are advantages of a matrix organizational structure, there are certain disadvantages that one should be aware of as well. Here are some of them:
  • There can be a lot of confusion and conflict over factors like the sharing of resources by two teams or the team which is working in two departments.
  • The cost is likely to increase if there are a lot of project managers hired for the job.
  • Since the basic functioning allows for a lot of independence, and the decision power is placed on the team members or even the project manager, there are chances of a delay in the completion of the project.
Many organizations find this structure highly advantageous for their working style because it brings about extremely effective functioning.