Depending upon the nature of project and the corporate policy, the project management organization pattern can vary from highly centralized functional organization to a dedicated project team with fully decentralized authority. The matrix organization of project management lies in-between these two extreme organizational concepts. A typical matrix structure of project organization is show in fig.



The matrix structure is viewed as a temporary organization having human and non-human resources with reduced vertical hierarchy so as to respond speedily in a changing complex situation for achieving the specified performance objectives.
The managers in a project team are its key personnel. They are drawn from their parent departments and are specialists in their field. They are charged with the responsibility of their respective areas of activity. In this way, communication and co-ordination between top management and project management is improved.
Following are the advantages of the matrix structure.

a)     It has a single project manager accountable for the whole project. This project management working as a team, performs the basic management functions of planning, organizing, staffing, directing, controlling and coordinating the project work.

b)    All managers owe their allegiance to the project manager and not to their parent departmental heads.

c)    Personal commitment to objectives is the key note of matrix organization. It provides a climate for motivation, effectiveness and personal development.

d)   The specialist staff is employed effectively. The matrix organization balances their conflicting objectives by reducing the communication gap.

e)    The top management is freed from making routine decisions, as the decision-making machinery forms an integral part of the matrix structure.

f)      It provides enough flexibility to meet uncertain and changing situations by establishing a project planning and control system at site to monitor the input flow of resources and the performance output.

However, if not properly conceived and directed, the matrix organization can result in increased conflicts, lack of coordination, low productivity, and enhanced costs.