Details of Matrix Organisational Structure
Matrix organisation or grid organisation is a kind of departmentation. It can apply to a company, a project or even product management. This departmentation is particularly helpful in achieving organisational objectives that a company sets forth. The formal matrix organisational structure consists of the job structure, hierarchy, flow of communication and employee relationship, etc. Matrix organisation is one such part of the overall formal structure. In the following article, details of matrix organization will be discussed vividly.
What is a Matrix Organisation?
Matrix organisation is the combining of project or product patterns of departmentation and functional departmentation within the same organisational structure. In a matrix organisation, there is more than one line of reporting managers. In other words, there is more than one boss for the employees. Organisations that deal in a diverse array of products opt for this kind of a structure.
What is a Matrix Structure?
The matrix structure is common in engineering and product marketing organisations. In a matrix structure, individuals who specialise in some particular fields work together in a team and also work individually in his own department at the same time. For example, if a company is developing a new product, the team entitled with the duty will consist of engineers, designers, finance experts and marketing analysts etc. This can be referred to as a matrix structure.
Explain the Matrix Organizational Structure
As we explain the matrix organizational structure, we must also discuss the three other organisational structures namely functional, line and third and line and staff. However, the matrix structure is way more complex and resembles a matrix or a grid-like representation. Both project management and functional organisation have been combined to form a matrix structure.
Matrix Organizational Structure Advantages and Disadvantages
There are a good number of matrix organizational structure advantages and disadvantages. In the following section, we will first describe the benefits of matrix management. These are:
The benefits of matrix management are mostly enjoyed by the employees as they can gather dual support from the product manager and the functional manager both. Thus knowledge, effort, skill and work all are taken care of.
The available resources are more efficiently used when this structure is implemented. The resources are not stagnated either as they can be shared among the ongoing projects. This reduces the cost also.
The flow of information is smooth in all directions
All the departments involved coordinate with each other and thus miscommunication does not occur.
With more than one manager in place, the employees have to take decisions autonomously sharpening their decision-making skill.
Both lateral coordination and specialization are encouraged.
There are Some Disadvantages of Matrix Organization as Well, These are:
The structure is overtly complex; not all employees are comfortable working here.
The dual authority may pose many problems in terms of complexity. Employees may often get confused about whom to approach as the higher authority.
If any of the managers showcase ineffectiveness in management, miscommunication my follow
It is more expensive than other organizational structures.
If there is a lack of communication between the managers or there is internal competition between them, conflicts are bound to occur leading to the failure of achieving organisational objectives.
In a nutshell, this is all about matrix structure along with matrix organization advantages and disadvantages. Though profitable, it has its complexities. In today’s world, the matrix structure is the most prominent one in the corporate sector. The involvement of two managers and their relationship with the employees pave the path for the achievement of the organizational goals.
FAQs on Four Key Elements of Entrepreneurship
1. What are the four key elements of entrepreneurship as per the CBSE curriculum?
The four key elements that form the foundation of entrepreneurship are:
- Innovation: This involves creating a new product, service, or process, or significantly improving an existing one. It is the commercial application of creativity.
- Risk-Taking: This is the willingness to commit resources to an opportunity that has an uncertain outcome. Entrepreneurs face financial, career, and social risks and must take calculated risks to achieve their goals.
- Organisation: This is the ability to bring together various factors of production, such as land, labour, and capital, to create a functional business enterprise. It involves planning, coordinating, and managing all resources effectively.
- Vision/Leadership: This refers to the entrepreneur's ability to foresee future market trends, identify opportunities, and guide the venture towards its long-term goals. It's about setting a clear direction and inspiring others to follow it.
2. Can you provide real-world examples for each of the four elements of entrepreneurship?
Certainly. Here are some examples illustrating the four key elements:
- Innovation Example: When OLA Cabs introduced an app-based taxi booking service in India, it was a process innovation that disrupted the traditional taxi industry.
- Risk-Taking Example: Elon Musk's investment of his personal fortune into SpaceX, a company aiming for space exploration with a high chance of failure, is a prime example of risk-taking.
- Organisation Example: Dhirubhai Ambani's success with Reliance Industries showcases superior organisation skills in bringing together massive capital, technology, and human resources to build one of India's largest conglomerates.
- Vision Example: The late Steve Jobs had a clear vision for Apple to create user-friendly technology that integrates seamlessly into people's lives, long before the iPhone or iPad became a reality.
3. How are the key elements of entrepreneurship—innovation, risk-taking, and organisation—interconnected?
These elements are deeply interconnected and work in a cycle. An entrepreneur's vision identifies an opportunity, which often requires an innovation to be realised. Pursuing this new idea inherently involves risk-taking, as its success is not guaranteed. Finally, to manage this risk and successfully implement the innovation, the entrepreneur must apply strong organisation skills to marshal resources and execute the plan. Without one element, the others are less effective.
4. Why is risk-taking in entrepreneurship considered a calculated action and not just gambling?
The key difference between entrepreneurial risk-taking and gambling lies in information and control. A gambler operates on pure chance with little to no control over the outcome. In contrast, an entrepreneur takes calculated risks. This means they:
- Conduct market research to understand potential rewards and dangers.
- Develop business plans to mitigate potential failures.
- Use their skills and knowledge to influence the outcome.
- Secure resources and build a team to improve the chances of success.
Therefore, it's an informed and strategic venture, not a blind bet.
5. What are the main types of entrepreneurship relevant for a Commerce student?
For a Commerce student, it's useful to understand these four main types of entrepreneurship:
- Small Business Entrepreneurship: Focuses on creating a business to provide family income. Examples include local grocery stores, restaurants, or service businesses. They are not typically built for massive scale.
- Scalable Startup Entrepreneurship: These ventures, like tech startups (e.g., Zomato, Paytm), are started with a vision to grow into a very large company. They seek out investors and aim for rapid expansion.
- Large Company Entrepreneurship: This involves developing new business units or products within an existing large corporation. It's often called 'intrapreneurship'. For example, when Google developed Gmail as a new product within its existing structure.
- Social Entrepreneurship: This type focuses on creating innovative solutions to social problems. The primary goal is social impact, not just profit. An example is an organisation that creates affordable clean water solutions for rural areas.
6. Is there a concept of the '4 P's of entrepreneurship'?
While the '4 P's' are a famous framework in marketing (Product, Price, Place, Promotion), there is no universally accepted '4 P's of entrepreneurship' in academic business studies. The core concepts are recognised as innovation, risk-taking, organisation, and vision. Some consultants or authors might propose their own '4 P's' like 'People, Purpose, Process, and Profit' as a helpful mnemonic, but this is not part of the standard CBSE/NCERT syllabus for the core elements.
7. Beyond the four core elements, what other determinants are crucial for entrepreneurial success?
While the four elements are foundational, other determinants significantly impact an entrepreneur's success. These include:
- Entrepreneurial Competencies: Personal traits like resilience, perseverance, networking ability, and leadership.
- Access to Capital: The availability of funding, whether through personal savings, loans, or investors, is critical to start and scale a venture.
- Market Opportunity: Identifying a genuine need in the market with a customer base willing to pay for a solution.
- Support Ecosystem: The presence of mentors, government policies, industry networks, and skilled labour in the environment.
