What is matrix management?

Matrix management is one of the four main forms of organization of a company. It represents an attempt at a synthesis between a functional organization and a divisional organization. Matrix organization is mostly used in industry where design and manufacturing need to be coordinated. To be implemented effectively , it requires certain arrangements and the competence of a seasoned manager.

The 4 types of organization

There are four types of organization in a company: the functional organization, the divisional organization, the organization in project mode and the matrix organization.
The matrix organization is a synthesis of the first two.

The functional organization separates the functions within the same company. For example, the Commercial department, R&D or Logistics. Each department has a Director, a few managers and several employees. Each of them therefore has only one leader.

The divisional organization is adopted by companies which develop several activities, for example Hospitality and Transport, or which have a presence in different territories, for example the division located in France and that which is in Spain. A division is generally autonomous.

Definition of matrix organization

The matrix organization combines the functions and divisions of the company. An employee can therefore be part of the Spanish division and work with colleagues from other countries on the launch of a product. Each member of the team formed is a specialist in his field.

The matrix organization can be broken down into different associations: functions and a product, functions and a strategic project, digital transformation and several countries, etc.

In this diagram , the hierarchy is shaken up, because an employee has at least two leaders: the hierarchical superior in the function and the project manager who directs or coordinates the work group.

The advantages of the matrix organization

The matrix organization appeared in the 1950s in the United States . It is undoubtedly Boeing which is at the origin. This type of management offered an answer to a production that was becoming more and more complex and demanding. The employees selected then belonged to a specialized function (the engine, the wings, the landing gear, etc.) and to a division (the Boeing 727, the Boeing 737, etc.).

This type of organization is dynamic . It promotes cross-functional relationships. Projects are multiplying and employees are always involved. Motivation is high.

The disadvantages of the matrix organization

The main disadvantages are generated by the division of decision-making powers. The employee finds it difficult to satisfy his two bosses, especially when the orders are contradictory. End-of-year performance reviews and the allocation of performance bonuses are rarely the subject of consensus between the two leaders. One is satisfied with the employee’s involvement and results. The other believes that he was too little present and that his contributions were insignificant…

We must remain vigilant on these points, because the risk that the matrix organization is confronted with multiple blockages is real. Decision makers are less visible and unnecessary meetings are on the rise.

The matrix organization encourages the specialization of employees. Replacing an unavailable employee will cost the company more.

Any organizational change within a company must be prepared and deployed with care. It is advisable to entrust these strategic changes to a professional. A Transitional Frameworkcan bring you his experience and lead the implementation of a matrix organization or any other form of management .