Matrix Organization

Some companies utilize the matrix organizational structure as a short-term arrangement for specific projects and tasks involving both functional group employees and project managers (Metcalfe 2014; Hall 2013; Finerty and Kraemer 2012).

Managers of functional groups supervise technical contributors who have valuable skills and know-how. Project managers are those entrusted by upper management with the responsibilities of managing specific projects, such as capital projects, the design of new products to specifications, and the creation of business entry strategies. Project managers have resources—money, time, facilities, and management support—and they "borrow" employees from the functional groups to accomplish the work (see Figure 3.5). When functional group employees complete their work for a given project, they usually return to their respective home groups to continue their original home-based assignments.

The advantages of matrix organizations are that project managers focus on schedule and cost, whereas functional managers concentrate on work quality and expertise. This arrangement offers a balance of workload, and it is excellent for participating employees to achieve wide exposure within the company by interacting with those outside of their special domains of expertise.

The main disadvantage is that this structure requires participating employees to report to two bosses (dual reporting), thus violating the "unity command" principle. When employees are assigned to work on several projects, they may be subjected to marching


Matrix organization.

orders issued by several superiors. In practice, conflicts between the functional and project managers are frequent and severe, mostly with respect to task priority, manpower assignment, interests, quality versus urgency, performance appraisal, employee promotion, and other issues.

Matrix organization demands a delicate balance of power between functional and project managers. Functional managers control manpower, particularly who works on what projects, when, and for how long, in addition to controlling knowledge and facilities. On the other hand, project managers have an approved spending budget and the support of upper management. A lack of a balance of power will occur when the functional managers have their own funds to support their own people, thus making them less dependent on project managers. An unbalance of power will also occur when project managers outsource some of the needed work that is not delivered by the functional managers. Under these circumstances, the matrix organization might break down.

Because of the aforementioned built-in conflicts, many companies in industry are moving away from the matrix organizations in favor of teams.

Example 3.2

Once the functional manager and project manager agree on a project schedule, who is responsible for getting the work performed? Who is accountable for getting the work performed? Why the difference, if any?

Answer 3.2

Responsibility and accountability are two different management concepts.

In a matrix organization, the project manager delegates tasks to the functional manager, who in turn assigns specific tasks to individual employees in his or her functional group. The functional manager remains responsible for getting the work performed, whereas the project manager is accountable for the results of the work that has been delegated to and done by the functional manager (or his or her people).

Engineering Management


The project manager is accountable for achieving specific project objectives. He or she defines the pertinent tasks to be accomplished. If the tasks are defined improperly, causing the project objectives to be impossible to attain, the project managers are accountable for such mistakes. The functional manager, on the other hand, is responsible only for supplying the right people with the proper skills and dedication to accomplish the stated tasks. The functional manager is responsible for accomplishing the agreed-upon tasks in an efficient and professional manner.

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