A Matrix Structure : An Organization

Alternative structures such as grouping by output/product or grouping by market are not options as they would result in “duplication of activities and resources, the erosion of deep technical expertise, missed opportunities for synergies and learning” (Ancona, Kochan, Scully, Van Maanen, & Westney, 2009, p. M2-19). The matrix structure provided a potential positive aspect in that it would provide a needed cross-functional linking mechanism by mixing the functional structure with grouping by output/product, but the complexity, cost, dual systems, and dual roles resulting from the matrix structure historically resulted in either the functional or the output/product system becoming more powerful than the other.

When a firm is rating its processes and products against the best in the world, the firm is practicing:

Lastly, the matrix structure is a combination of the functional and multidivisional structures (Rothaermel, 2013). It is most appropriate when an organization needs a structure which allows for both centralized and decentralized decision-making, and can be organized by geographic areas and product divisions (Rothaermel, 2013). While a global strategy does not automatically lend to a matrix structure, a transnational strategy which has the requirements above is better served through a matrix structure (Rothaermel, 2013).

The company is geographically located in most major united states locations. It employs a hierarchal organizational design. One of the contributing factors to its success is the company’s success in providing a dining experience for its customers that excel in choices, price, customer service, and serving size. The company is known world-wide for its delicious cheesecakes with the key factor being the variety.

The job design and the motivation are not self-sufficient to increase the productivity and they require an organizational structure to further coordinate organizational activities. Organizational structure, through its chain of command, coordinates, motivates and monitors employees.   Buchanan and Huczynski (2010) argue that the structure of the organizations serves 3 functions:

An organization must align its strategy and structure to allow itself to achieve performance improvements over time. The four different structures, simple, functional, multidivisional, and matrix, are all suited to allow companies with different strategies to succeed but the company must decide which of these is correct for itself. A small start-up company will overburden itself with excessive cost if it seeks to implement a functional structure because it clearly will not have the talent on hand to create whole departments of HR employees or accountants. On the other hand, a company that grows to become a large multi-national

The hospital’s formal matrix organizational structure consists of a bureaucratic hierarchy of authority (Appendix A). Dunham-Taylor and Pincszuk (2010) proposes that matrix structures promote originality and inventions; yet, they are problematic to manage due to the confusion in management levels. Moreover, this type of structure requires proficient management skills and communication to foster functionality within the organization. The hospital’s bureaucratic structure delineates a clear chain of command which provide rules and regulations, specialization of work, division of labor, and impersonality of relationships (Marquis & Huston,

State Street is a matrix structure which means that: the company structure in which the reportage relations are settled as a grid, or matrix, rather than in the old-style hierarchy. In other words, staffs have double broadcasting relationships - usually to both a practical manager and a product

BEC has taken on the matrix organizational structure. This type of structure combines functional and divisional organization structure styles. There are advantages and disadvantages in utilizing this

“Unity is strength…when there is teamwork and collaboration, wonderful things can be achieved” – Mattie Stepanek. Over the last two centuries the framework of industry and the business world has undergone several major transformations. The first shift occurred during the Industrial Revolution. In response to the rapid technological and social changes of this period, most organizations adopted a hierarchical organizational structure. This organizational structure permeated industry and business across the globe. Organizations with this type of organizational structure resemble a pyramid, with communication and direction flowing downward from the Chief Executive Officer, through the chain of command down to front line or assembly line employees (Morgan, 2015). Top down organizational structure was extremely resilient and enabled organizations to easily communicate culture, direction and maintain a position of strength in a manufacturing centered economy (Morgan, 2015).

Effective organizational structures define how job tasks are subdivided, grouped, coordinated, and managed. Six key components of organizational structures include division of labor, departmentalization, chain of command, span of control, centralization, and formalization (Remme, Jones, Van der Heijden, & De Bono, 2008, p. 79). Each element influence how employees interact with each other to reach organizational goals. Different structures are common in similar organizations among high performing organizations (Reimann, 1974, p. 707). The most appropriate structure will depend on the unique needs and culture of the organization.

As seen from figure 2, the matrix organisational structure is complex and aligns functional and divisional organisational structures merged into a hierarchical structure. The student observes that with this comes the potential to on the one hand, improve interdepartmental collaboration through avoiding silo-functioning and yet, on the other hand, blur the unity of command structure in an organisation that can be counterproductive. A critical analysis of two major advantages and disadvantages of this organisational structure here

Manager’s of an organization has to use structure to help the company run efficiently. “The five types of organizational structures are functional, divisional, matrix, team-based, and virtual network” (Draft, 2013, p.316). Functional structure in an organization that is developed by grouping departments by the skills, level of knowledge, activities done daily, and the resource used. “This structure places specific departments from the bottom to the top” (Draft, 2013, p.318). For example, specific departments such as: human resources, accounting, engineering, and manufacturing are placed at the top, while there are mostly seen at the bottom in other organizations. While common functions such as; people, facilities, and other resources are combined together as a single department instead of being divided into multiple departments.

The very same characteristics that are seen as advantages of a matrix also present numerous disadvantages, which can potentially diminish the level of organizational flexibility and responsiveness to change (Ford & Randolph, 1992). The duality of a matrix tends to create ambiguity and conflict in terms of identifying the lines of authority and responsibility for organizational decision-making (Larson & Gobeli, 1987). In addition, the confusing ambiguity of a dual reporting relationship often forces employees to reconcile conflicting responsibilities and priorities, which, in turn, causes considerable stress, diminished motivation and commitment, and increased resistance to change (Ford & Randolph,

Although there are signs that the company has a matrix structure in place, they do not follow a programme management approach and numerous failures within the structure exist. Their approach to management is still that of a traditional organisational approach, which tends management to lack both strategic purpose and customer focus.