Matrix organizations have become common in many businesses and industries. The organization is basically arranged so that workers with similar skill sets and specializations work together in the same department. This sort of arrangement has both advantages and disadvantages. Matrix organizations do not typically evolve organically but are rather the result of a specific plan that a business implements, often after debate.
When all the employees of a certain specialization are grouped together, they are able to better take advantage of teamwork to accomplish their collective tasks. Knowledge sharing is made more common, as employees can rely on a shared technical background when interacting with their co-workers. Workers will also be more likely to feel an affinity for one another, as they will have more in common, at least from the perspective of their work lives.
There will likely be more accountability in a business that has a matrix organizational structure. Workers and managers will be directly accountable for the quality of work that any department delivers. People will be less able to pass on the responsibility for the accomplishment of a task by saying it is not in their specialization. Every department will have a clear responsibility to deliver specific work that falls under its specialization area.
One of the disadvantages of a matrix organization is that it can lead to over-compartmentalization in a company. As each department focuses more and more on its own tasks, departments may fail to effectively communicate with one another. The overall cohesion of an organization can begin to break down if workers and managers begin to feel more of a commitment to their department than to the overall company. People may lose sight of the larger picture.
Though a matrix organization is meant to increase the specialization of different departments, areas of specialization can often overlap. For instance, a department that focuses on sales may also undertake some of the work of the advertising department. This sort of overlapping in specialization can create a needless redundancy in an organization, increasing its costs as managers and employees from different departments undertake tasks that could be accomplished by one department.