Matrix structure

The matrix structure groups employees by both function and product. This structure can combine the best of both separate structures. A matrix organization frequently uses teams of employees to accomplish work, in order to take advantage of the strengths, as well as make up for the weaknesses, of functional and decentralized forms.

Starbucks is one of the numerous large organizations that successfully developed the matrix structure supporting their focused strategy. Its design combines functional and product based divisions, with employees reporting to two heads. Creating a team spirit, the company empowers employees to make their own decisions and train them Matrix structure to develop both hard and soft skills. That makes Starbucks one of the best at customer service.

Some experts also mention the multinational design, common in global companies, such as Procter & Gamble, Toyota and Unilever. This structure can be seen as a complex form of the matrix, as it maintains coordination among products, functions and geographic areas.

Flat organization (also known as horizontal organization)

refers to an organizational structure with few or no levels of intervening management between staff and managers. The idea is that well–trained workers will be more productive when they are more directly involved in the decision Matrix structure making process, rather than closely supervised by many layers of management.

This structure is generally possible only in smaller organizations or individual units within larger organizations. When they reach a critical size, organizations can retain a streamlined structure but cannot keep a completely flat manager–to–staff relationship without impacting productivity. Certain financial responsibilities may also require a more conventional structure. Some theorize that flat organizations become more traditionally hierarchical when they begin to be geared towards productivity.

The flat organization model promotes employee involvement through a decentralized decision–making process. By elevating the level of Matrix structure responsibility of baseline employees and eliminating layers of middle management, comments and feedback reach all personnel involved in decisions more quickly. Expected response to customer feedback becomes more rapid. Since the interaction between workers is more frequent, this organizational structure generally depends upon a much more personal relationship between workers and managers.

In general, over the last decade, it has become increasingly clear that through the forces of globalization, competition and more demanding customers, the structure of many companies has become flatter, less hierarchical, more fluid and even virtual.

Answer the following questions:

  1. Why is an effective organizational structure Matrix structure beneficial for the whole organization?

An effective organizational structure shall facilitate working relationships between various entities (структурное подразделение компании) in the organization and may improve the working efficiency within the organizational units.

  1. Which organisational structure is typical of small business?

Pre–bureaucratic (entrepreneurial) structures lack standardization of tasks and duties. This structure is most common in smaller organizations and is best used to solve simple tasks. The structure is totally centralized. The strategic leader makes all key decisions and most communication is done by one on one conversations. It is particularly useful for new (entrepreneurial) business as it enables the founder to Matrix structure control growth and development.

  1. Which organisational structure used to be taken by Shell? Why did it prove to be unsuccessful? Which one was adopted then?

Shell Group used to represent the typical bureaucracy: top–heavy and hierarchical. It featured multiple levels of command and duplicate service companies existing in different regions. All this made Shell apprehensive to market changes, leading to its incapacity to grow and develop further. The failure of this structure became the main reason for the company restructuring into a matrix.

  1. Is the post-bureaucratic organization hierarchical? How are the decisions made in such Matrix structure organization?

The strategic leader makes all key decisions and most communication is done by one on one conversations.

  1. Which organisational structure is typical of non-profit organizations?

post–bureaucratic organization

  1. Which organizational structure is the most decentralized?

Flat organization (also known as horizontal organization)

  1. Which organizational structure best suits a producer of standardized goods?

Functional structure

  1. What is economy of scale?

products are sold and distributed quickly and at low cost

  1. How can divisions within a divisional structure be categorized?

Divisions can be categorized from different points of view. There can be made a distinction on geographical basis (a US division Matrix structure and an EU division) or on product/service basis (different products for different customers: households or companies)

  1. Which organisational structure combines both functional and product ones?

Matrix structure

  1. Which organisational structure widely uses teamwork? Why?

A matrix organization frequently uses teams of employees to accomplish work, in order to take advantage of the strengths, as well as make up for the weaknesses, of functional and decentralized forms.

  1. Which divisions does the matrix structure of Starbucks combine?

Its design combines functional and product based divisions, with employees reporting to two heads.



  1. What makes Starbucks one of the best at customer service Matrix structure?

Creating a team spirit, the company empowers employees to make their own decisions and train them to develop both hard and soft skills (профессиональные и межличностные навыки). That makes Starbucks one of the best at customer service

  1. Which organizational structure is typical of most global brands?

  1. What is multinational matrix structure

This structure can be seen as a complex form of the matrix, as it maintains coordination among products, functions and geographic areas.

  1. What is the main peculiarity of a flat organizational structure

Flat organization (also known as horizontal organization)

refers to an organizational structure with few or no levels of intervening management between Matrix structure staff and managers. The idea is that well–trained workers will be more productive when they are more directly involved in the decision making process, rather than closely supervised by many layers of management.

  1. Why is this structure most impossible in large organisations?

When they reach a critical size, organizations can retain a streamlined structure but cannot keep a completely flat manager–to–staff relationship without impacting productivity.

  1. When should an organizational structure be altered?

When a business expands, the chain of command will lengthen and the spans of control will widen.


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