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Traditional Organization Structures
FUNCTIONAL
DIVISIONAL
Groups together people, who work on the same product and process, serve customers of similarity and are located in the same geographical area.
• The matrix structure combines functional and divisional project or program teams
• Workers in a matrix structure belong to at least two formal groups at the same time
• Matrix structures can be found in settings such as manufacturing, service industries, service industries, and the non-profit sector
• Efficient use of resources
• Task assignments consistent with expertise and training
• High-quality technical problem solving
• In-depth training and skill development
• Clear career paths within functions
• Better cooperation across functions
• Improved decision making
• Increased flexibility
• Better customer service
• Better performance accountability
• Improved strategic management
• Difficulties in pinpointing responsibilities
• Functional chimneys problem (lack of communication and coordination)
• Susceptible to power struggle
• Two boss system may become frustrating to team members
• Team meetings may become time consuming
• Teams may develop "groupitis"
• Requirements of adding team leaders to the structure may create increased costs
• Sense of cooperation and common purpose break down
• Narrow view of performance objectives
• Excessive upward referral of decisions