Matrix Structures

This week, both of the lecture and seminar are focus on organizational design and structure, and  I was interested in Matrix Structures. At first,I was confused by this concept which I did not know before. After read MULLINS, I understood that matrix is a company structure, in this structure, employees come from different departments work in a same group to achieve a same goal.

As it is illustrated in the chart, we can see a two-way flow of authority and responsibility. The functional units authority and responsibility flow vertically down the line ,and the responsibility of the project manager flow horizontally across the organization.To explain this idea more clearly , I will introduce the matrix structure of a very famous electronic company---Philips.         

 Philips is a dutch electronic company, after the second  world war , it set up both organizations and product divisions. For example, the boss of washing-machine division in Italy, would report to both of the head of philips  in Italy and in Netherlands.In this way,first of all, information flows both vertically and horizontally. Employees are in contact with many people, the information can be shared and the decision process can be speeded quickly. Moreover, employees are expected to do different job and move around in their career instead of sticking with a monotonous job in a single geographical region. Matrix Structure can motivate the employees in Philips.

But the Matrix Structures do have advantages, Firstly,by the 1990s,Philips had decided that structure was no longer working well, for example, when profit and loss occurred , who was to be held responsible for it ? so it can be difficult to determine who is responsible for operating financial results.Secondly,functional groups may tend to neglect their normal duties and responsibilities.

Reference1: http://www.economist.com/node/5380495