Matrix Organization Structure: Advantages and Disadvantages

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