Abstract
IntroductionThe matrix structure is sometimes presented as an inevitable “end point” for organizations that must adapt to an increasingly complex business environment. However, observations of the structure of firms do not always confirm this view.Case descriptionThe paper describes the evolution of FMC Subsea, a large division of the global technology firm FMC Technologies (now TechnipFMC).Discussion and evaluationDuring the 2001–2016 time period, the firm’s organizational structure underwent three significant changes. The firm was originally organized by geography. In 2011, it introduced global product units, which resulted in dual reporting lines (i.e., a matrix structure) for some regional managers. However, in 2015, it separated the product lines from the regional units, thereby eliminating the need for dual reporting.ConclusionThis example suggests that the matrix structure may sometimes be a transitory form that eventually gives way to a simpler—yet still multidimensional—structure.
Highlights
The matrix structure is sometimes presented as an inevitable “end point” for organizations that must adapt to an increasingly complex business environment
The key assumption is that the matrix, as a complex organizational form, is a response to an ever more complex business environment: “An increase in environmental complexity and uncertainty drives the need for the matrix and its complexity
Even this figure may be too high, because it was based on a very broad definition of “matrix”: Only 15 out of the 82 firms had the typical matrix structure associated with international firms, where a regional manager reports to both a global product manager and to the head of a regional unit
Summary
During the 2001–2016 time period, the firm’s organizational structure underwent three significant changes. The firm was originally organized by geography. In 2011, it introduced global product units, which resulted in dual reporting lines (i.e., a matrix structure) for some regional managers. In 2015, it separated the product lines from the regional units, thereby eliminating the need for dual reporting
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