Matrix Organizational Structure – A Quick Guide (2024)

If you need to manage multiple projects, it’s recommended to have a matrix organizational structure in place. Projects have many activities, from resource planning to task management and everything in-between. Therefore, that organizational structure shouldn’t be rigid, but flexible and efficient.

Every organization is structured in some way, and that structure is determined by its business goals and project objectives. The way you structure the functional areas of an organization is going to offer a standard for operating procedures and routines. It will also determine what your team members do, and what project management tools are best for the job at hand.

Matrix organizational structures are often used in project management because they speak to both the product of the project and the function of the management producing it. Let’s take a closer look at this type of organizational structure to determine its pros and cons in project management.

What Is a Matrix Organizational Structure?

A matrix organizational structure is a combination of two or more organizational structure types. The matrix organization is the structure uniting these other organizational structures to give them balance.

Usually, there are two chains of command, where project team members have two bosses or managers, a functional manager and a project manager. These roles are fluid and not fixed, as the hierarchical structure between these two kinds of managers isn’t organizationally defined.

This two-boss matrix will employ the best of both organizational charts and management styles to strengthen strengths and make up for weaknesses. This way, if an organization is working on producing two products or services at the same time, they can organize both and use that duality to their advantage through the matrix organizational structure.

Managing multiple projects requires robust project management software. ProjectManager has an overview section that includes portfolio roadmaps. This Gantt chart view lets you see all the projects in your portfolio on one page to better strategize resource planning. Get better organized today by trying our tool for free.

How Does a Matrix Organizational Structure Work?

A matrix structure is more than just overlapping an organizational chart on top of another. Using matrix organizations requires careful planning and team collaboration tools.

Matrix structures work by fostering cross-team collaboration and shared resource planning across projects. Simply put, a matrix organization structure reorganizes companies to maximize their productivity and uses two chains of command to make them more dynamic.

Pros and Cons of a Matrix Organizational Structure

A matrix organizational structure is not a one-size-fits-all solution. There are advantages and disadvantages that need to be understood to know if it’s the right one for the organization. Plus, there are three types of matrix structures that you’ll need to know before making a decision. But before we learn about those types, here are the main pros and cons of using a matrix structure.

Pros

A matrix organizational structure can benefit your company because:

• It allows the sharing of skilled resources between functional units and projects, which facilitates resource planning.
• It fosters better cross-functional communications, which improves team collaboration and builds a more dynamic organization.
• It helps organizations achieve their goals at a faster pace, thanks to a higher use of material and human resources.
• This structure is great for employees who are looking to widen their experience and skill sets. It puts them in an environment that facilitates learning and gives them an opportunity to grow professionally.

Cons

As usual, there’s also some cons associated with the use of matrix organizational structures:

• There can be some confusion about the organization’s hierarchical structure when a team member is subject to two managers, and it can be difficult to reach a balance of power between them. That can also create unnecessary conflict.
• Limited resources can become an issue if managers don’t communicate during the resource planning process.
• There are a lot of managers in a matrix organizational chart, which is not to everyone’s liking. And having more people in managerial positions affects the company’s costs.
• Team members can feel the strain of working in a matrix organizational structure, in that their workload can be heavy.

Types of Matrix Organizational Structures

The main difference between these matrix structure types is the balance of power between the functional manager and the project manager. Let’s see how they differ.

Weak Matrix Organization

In a weak matrix organization, the functional manager oversees all project management areas and is the highest authority in the decision-making process throughout the project. The project manager on the other hand has a much lower authority and has to answer to the functional manager.

Balanced Matrix Organization

In this type of matrix structure, the project manager has more authority than in a weak matrix organization. The functional manager still acts as the primary managerial authority in the decision-making process.

Strong Matrix Organization

In a strong matrix organization, the project manager has equal or more power than the functional manager. The project manager has control over resource planning and task management.

ProjectManager Can Help you Run a Matrix Organizational Structure

Given the complexity of a matrix organizational structure, it’s critical to have the right project management tools to make sure team members are receiving their tasks in a clear and orderly fashion. Two bosses can create a muddle, so having all project communication housed in one software is essential.

ProjectManager has a “My Work” section that enables team members to see all of their tasks in one place, regardless of whether a project or functional manager assigned it to them. This enables them to manage their workflow more efficiently, marking their progress and adding comments along the way for managers. They can also work on tasks by projects too if they want to stay in one mindset before moving on to another project.

For project and functional managers, the reporting tools in ProjectManager can be nothing short of essential. With a real time project dashboard and advanced reporting features, management can always keep abreast of what’s going on. With ProjectManager, you can make a project report with just one click. Our reports include status reports, task reports, variance reports, availability reports and more. This is an all-encompassing project management software that suits everyone in the organization.

Related Organizational Planning Content

• What Is Organizational Planning in Project Management?
• What Is Organizational Strategy in Business? (Examples Included)
• Organizational Resources Basics: Managing Company Resources

When dealing with multiple projects, a matrix organizational structure can give you an advantage, but only if you and your team are equipped with powerful tools. ProjectManager is a cloud-based project management software that is built to manage projects of all sizes and levels of complexity. Its real-time data keeps managers updated and gives project teams a collaborative platform. Try it today with this free 30-day trial.