Functional vs divisional vs matrix structure

What is matrix vs functional organization? Flat Organizational structures define the hierarchy or an organization, and determine the way information flows within it. When establishing a structure , business leaders should decide how a structure best aligns with the company’s principles and goals and how it outlines and sets up tasks for each employee.

A matrix structure is organized around product and function, while a divisional structure focuses on product , market and geographic location. The structure of the organization has an impact on how information, resources and operations are conducted.

The functional organisational structure is one where employees are grouped together, according to their area of specialisation. On the other hand , divisional organisation structure refers to the structure wherein the organisational functions are grouped together , into divisions , depending on product , service , market or geographies. The key difference between matrix structure and functional structure is that matrix structure is a type of organizational structure where employees are grouped concurrently by two different operational dimensions whereas functional structure is a structure that divides the organization based on specialized functional areas such as production, marketing, and sales for the purpose of management. However, the divisional. While a functional organization structure may be more common in long-established companies , a matrix organizational structure could benefit startups since its more nimble and responsive.

Organizational structure defines who is responsible for decision-making, establishes how various tasks and responsibilities are groupe and outlines the roles of people and departments within the organization. Two common types of organizational structures are functional and divisional structures.

The key difference between functional and divisional structure is that functional structure is an organizational structure in which the organization is divided into smaller groups based on specialized functional areas such as production, marketing and sales whereas divisional structure is a type of organizational structure where operations are grouped based on divisions or separate product categories. One person, alone, can start and run a small business, but when two or more people come together to accomplish a business goal, an organization is formed. Divisional Organizational Structure. Each person assumes a role within the organization, and the organizational structure determines the reporting. The functional structure has the advantage of simplicity, however it does not encourage interdivisional cooperation and knowledge sharing.

The matrix structure , in contrast, is highly encouraging of knowledge sharing and cooperation between divisions. Employees within the functional structure are differentiated to perform a specialized set of tasks. For instance, the marketing department would be staffed only with marketers responsible for the marketing of the company's products. Functional Structure.

For instance, if a company manufactures both Widgets and Gadgets, the matrix structure incorporates a Widget sales department, a Widget accounting staff and a Widget customer service office, as well as the same departments for the Gadget product line. Matrix Structure : In a matrix structure , people typically have two or more lines of report. For example, a matrix organization may combine both functional and divisional lines of responsibility. The advantage is that the organization focuses on divisional performance whilst also sharing functional specialist skills and resources.

Many companies within the building and construction industries also have a matrix organizational structure. Conclusion – functional organization vs divisional organization.

The structure an organization adopts depends upon many different factors including size of the business, specific business activates, growth plans etc. A structure is then developed to establish how the organization operates to execute its goals. There are many types of organizational structures.

There’s the more traditional functional structure , the divisional structure , the matrix structure and the flatarchy structure. The primary reason for the firm’s success is its structure. Different organizational structures that combine to form Starbuck’s matrix structure are divisional structure , functional structure , and team-based structure. A disadvantage of the functional structure is that it adds layers of bureaucracy.

It can slow down innovation, as many levels in the chain of command must individually approve new ideas or decisions. The divisional structure groups teams or departments into broader divisions. This is often done on either a geographic.