Matrix Organization and project management

The matrix organization is an attempt to combine the advantages of the pure functional structure and the product organizational structure. This form is identically suited for companies, such as construction, that are “project-driven”. The figure below shows a typical Matrix organization.

In a matrix organization, each project manager reports directly to the vice president and the general manager. Since each project represents a potential profit centre, the power and authority used by the project manager come directly from the general manager.