a) Better coordination and control: - This structure is very much suitable to coordinate and control the functional activities and project activities. Project manager has got responsibility to establish better coordination and control system in organization. Functional authority flows downwards and project authority flows horizontally which enables to establish better control and coordination.
b) Adaptable to dynamic environment: - It is hybrid type of organizational structure which can easily adjust with changing environment at business world. The project managers have functional independently and they can get quickly feedback with information related with project. Along with project mange, employees from different functional area are specialists and adjustment does not become problematic.
c) Effective utilization of resources: - Project structure makes very much effective utilization of resources available. The whole staff along with project manager is specialists in various areas. And has to make maximum utilization of resources. They know better hoe to utilize project capacity and time, how to utilize human and financial resources they know better.
d) Particular management: - In this type of organizational structure people work in project as a team. They participate in decision making and problem solving activity. They make joint team effort. They have authority to carry out day to day activity. Frequent sharing of ideas and opinion with project manager is common.
e) Sufficient time for top management: - It encourages delegation of authority to project managers. Project managers are responsible for operation of the project. They have authority to take decision about day to day activity of project. Employee working in project will also have sufficient authority. Hence, top management will have sufficient time to think about policy and strategies.
f) Excellence in inter disciplinary specialization: - In matrix organizational structure experts and specialists from various functional areas are combined together and quality performance becomes possible. All experts from various disciplinary or functional areas interact with each other and they make excellent specialization.
g) Development of team work: - Team work is facilitating project organization or matrix organization itself is team work. Employees from various functional areas work under the spirit of team and make the project successful. Team effort is made.
a) Violation of unity of command: - They get command from two superior functional or departmental manager and project manager. He or she has to report superior at a time i.e; project manager and functional manager. He/she will be in confusion. Unity of command hence is violated.
b) Costly structure: - Matrix organizational structure involves huge overhead cost. There will be much paper work and information collection that involves heavy cost. Most of the worker or employees are specialist and they are given high remuneration and facilities and amount is given to project workers in many cases as incentives.
c) Problem of overspecialization: - Matrix organizational structure create problem of over specialization in some situations. Specialist from both functional project works gather to show many complex problems of the organization. As many experts gather to solve problems they waste valuable time in supporting their own ideas and sometimes problems remains unsolved. It becomes like the famous saying “Too many cooks spoils the food”.
d) Difficult to balance: - There will be two types of specialists functional and project specialist. And, to make a balance between these two specialist is a difficult task. Therefore, high level of interpersonal skill or specialists is required to balance these two types of experts and to maintain balance between project authority and functional authority is also difficult task.
e) Feeling of insecurity: - Those employees who are specially appointed for the projects they feel a sense of insecurity after the completion of the project. This may cause project completion delay. Loyalty and commitment towards project may decrease.
f) Lack of white coordination: - In a matrix organization there will be a problem of maintaining effective coordination among project workers, functional workers and among the workers from various functional areas. Project manager have to make a high level of exercise to maintain effective coordination in the organization.
Lack of commitment: - In a matrix organization, there wil be lack of commitment among employees towards project. No one will be responsible and loyal to the completion of the project. Due to the lack of commitment project completion delays, project cost increases. Unless and until the project is completed. They will get good amount with salary and benefit, this also decreases their commitment.