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Explain The Advantages And Disadvantages Of A Matrix Structure In Organisations.

1438 words - 6 pages

DEFINITIONIn the economic literature no one generally corresponding definition for the concept "Matrix-Organisation" exists. Nevertheless some general principles can be found:-While in the conventional organisation forms just one criterion is selected and used for the structure on a certain level, it is typical for the matrix organisation that simultaneously and with equal rights two or more structure features are taken into consideration.-Thereby emerges a "mixed organisation form", which also contains a horizontal responsibility as an addition to the vertical hierarchy. Under the concept "mixed organisation form" it is understood, that more than one principle of the "classic management theory" with regard to the groups formation (e.g. customer group, process, place) can be inserted. As a result, a double influence sphere can be recognised where the corresponding team or employee is. The employees stand therewith in a "system of dual leadership".-In this organisation form, consequently, a two partly or even multidimensional channel exists, where authority, responsibility for the performance execution, evaluation and control are exercised.The history of the matrix organisation and the reasons for its establishmentThe origin of the matrix organisation can be expressed as a developmental variation in project management. After the American Ministry for Defence gained some beneficial experience in project management during the Second World War, for the development and the building of the first atomic bomb (project Manhattan), several government departments encouraged this type of organisational structure in the private industry sector stipulating, that all companies who would like to receive orders, needed to present one contact person who was competent in answering all necessary questions. In this manner, the government departments could avoid being in contact with several contact people inside the same company which, due to the variety of projects and participating companies would have resulted in years of delay. The success of the US Air and Space industry during the 50s and the 60s was to a large extent due to this organisational measure. Project organisation quickly spread into other sectors and even entire companies, which worked on major projects, such as research and development departments, advertising agencies and enterprise consultancy.The matrix idea was originally limited to projects and, therefore, to a limited time period and purpose. In 1967, the Dow-Corning company attempted for the first time to transfer the basic idea of multi-dimensionality into a permanent organisation. Although the company could not fall back on other experiences apart from project management, the company management assessed this type of re-structuring to a 'multi-dimensional organisation' as a 'sweeping success in regard to productivity, export, turn-over and profit'.After only a few years, the list of users (of the matrix organisation) included a large number...

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