The Matrix StructureOrganizational Design ShunJi Cui Liu Julius Valjakka Dirk Croonen
Agenda• Different structures • Hierarchical structure • Line and staff structure • Liaison structure• Introduction Matrix structure • Why • History • Pros and cons • Differences • For whom is it best?• Types of matrix structure • Permanent structure • Shifting structure• Knight’s four problems• Continuum of the liaison devices• Conclusion
Different structures• Hierarchical structure • All subordinates except one • Mostly used Hierarchical Structure
Different structures • Line and staff structure • Dual structure • Formal authority to decide • Staff to adviceLine and Staff Structure
Different structures• Liaison structure • Traditional authority structure • Superposes an overlay Liaison Overlay Structure (e.g., Task Force)
Matrix structure• Why was the matrix design introduced? • Other structures favor bases • Management might need two bases on the same hierarchical level • Introduced late 1900 • NASA first real user Matrix Structure
Matrix structure• Pros • It chooses both bases • Delicate balance of power • NASA• Cons • Sacrifices the unity of command • In the case of General motors • High costs, excessive turnover, interpersonal conflicts • In the case of the hospitals• For what kind of organization is it best? • Resolve problems through informal negotiation among equals
Matrix Structure: Types1. Permanent form: where interdependencies remain more or less stable and so do the people and units in them.2. Shifting form: where interdependencies, market units, and people in the organization shift around frequently.
Permanent Form• Two sets of managers, with relatively equal power and opposed interest, who are suppose to negotiate their differences.• These two sets of managers have separate performance responsibilities, report up to separate lines of authority and see the world from different perspective.Example: manager from a specific store in an specific area, providing good andservices to the population of that area facing the manager of the overallmarket.
Permanent Form President Vice-president Vice-president Vice-president Vice-president Frostbite Snowblowers Canada Tahiti Remedies General Manager- Canadian Snowblowers Engineering Manufacturing Marketing
Three Dimensional Matrix Structure RegionalProducts Functional
Shifting Form• It is used for project works, where the outputs change frequently. In this case, the organization operates as a set of project teams which draw their members from the functional departments. Example: NASA uses this type of structure.
Shifting Form Executive Program Office Executive Staff Program Committee Service Coordinators Camera Satellite Propulsion Tracking Construction DesignTask-force Leaders Project 1 Functional Project 2 Managers Project 3 Project 4 Shifting Matrix Structure in tha NASA Weather Satellite Program.
Knight’s four problemsMatrix structure seems to be a most effective device for developing new activities andfor coordinating complex multiple interdependencies. It is not suitable for those in needof security and stability.1976, Review of matrix structure, Knight discussed four main problems:• Conflict: matrix structure internalizes conflicts between organizational needs and environmental pressures. It creates conflic whithin the organization.• Stress: Matrix organizations can be stressful places to work in. Reporting to more than one superior may create a ‘’role conflict’’.• Balance of power: a perfect balance without cooperation between facing managers can lead to many disputes.• Costly: Administration and Communication. Spent to much time at meetings and discussing rather than working. Time consuming.
Continuum of Liaison Devices Decisional Power with the Market Managers Decisional Power with the Functional ManagersPure Matrix Task forces anfunctional Liaison structure standing Pure marketstructure positions committees structure superimpose d on a superimposed functional Integrating on a market structure managers structure superimposed on a functional Liaison positions structure superimposed on Task forces and a market structure standing committees Integrating managers superimposed on a superimposed on a functional structure market structure
Case• 2004: Implementation of the matrix design• Situation now
Conclusion• The advantage of a matrix structure is that it facilitates rapid response to change in two or more environments. It is more responsive than other types of structures because it permit more efficient exchange of information. (people from different• Despite their advantages, matrix management structures have been criticized as having a number of weaknesses. For instance, they are typically expensive to maintain, partly because of more complex reporting requirements. So, for a organization in which the environment changes frequently, it is recommended to use a matrix structure if there are enough resources.