Spectrum Case Study: Matrix vs.

Spectrum case study: Matrix vs. multidivisional structuring Matrix structure Spectrum Brands began as an organization focused on a single product: Rayovac batteries. This singular focus was suited to a more hierarchical, traditional form of governance. However, given the company's current diversification, a matrix structure might make it more responsive to current shifts in market demand. The demand for gardening tools is seasonal in nature, and matrix teams can be easily constructed and dissolved once the need for a seasonal product has peaked and waned.

Additionally, synergy between different divisions can be created: a temporary matrix-style team could merge the product development and advertising teams of the gardening division, to create a 'composting' campaign for the summer, offering tools to enable people to compost their food waste to make fertilizer for their garden. This would take advantage of the new cultural interest in sustainability and merge marketing with technical innovation.

A matrix structure could also support initiatives such as creating a team in charge of a comprehensive campaign in which all of Spectrum's different brands emphasized their 'greenness' -- from green, rechargeable batteries, to organic pet food, to growing one's own vegetables. "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.

Information sharing is mandatory in such an organization, and several people may be required for the same piece of work. However, in general, the project manager has the total responsibility and accountability for the success of the project. The functional departments, on the other hand, have functional responsibility to maintain technical excellence on the project.

Each functional unit is headed by a department manager whose prime responsibility is to ensure that a unified technical base is maintained and that all available information can be exchanged for each project" (Matrix organization, 2010, VisitAsk). In an inter-organizational sustainability campaign, the project manager would ensure all functional teams had a similar, cohesive 'vision' but functional managers, such as the unit in charge of the technical aspects of creating new, natural pet foods, would ensure that the foods met the company's nutritional standards and FDA safety regulations.

Multidivisional structure In contrast, in a multidivisional structure, there are clear responsibilities for each unit. "Each division deals[s]with a conceptually distinct business and [is] self-contained with its own functional hierarchy" (Hoskisson et al. 1993, p.1). A multidivisional structure takes advantage of specialization: for example, having the pet care department tailor its offerings to different types of pets, and even different types of pet owners. The multidivisional structure can also more effectively reflect different organizational personalities.

Different pet care lines, gardening, and battery units would be separate, reflecting the unique needs of the industries, and also the different organizational personalities drawn to those industries. Employees drawn to work in pet care, for example, might be quite different than the more technologically-driven individuals drawn to working with batteries -- even if both units have needs for marketing and technological development, marketing or design for specific products can benefit from having a highly segmented approach, which is facilitated by a multidivisional structure.

Which structure would be more effective for Spectrum Brands? A matrix structure allows for greater "shared responsibility between project and functional management," and facilitates interdivisional teamwork (Matrix organization, 2010, VisitAsk). Teamwork is highly valued at Spectrum, and a matrix structure would exploit this advantage in a flexible and effective manner. A matrix structure also reduces costs, because it allows top talent to be shared between divisions: "because key people can be shared, the project cost is minimized" (Matrix organization, 2010, VisitAsk). The disadvantage to a matrix structure is the diffusion of responsibility.

Shared authority and responsibility can reduce accountability -- although it can inspire a corresponding increase in innovation. The greater bureaucracy of a multidivisional firm, in contrast, seems less well-suited for the current market environment and the company's desire for greater flexibility in its approach. Three examples of potential communication problems: Correctives Matrix structures are hardly problem-free, of course. There can be confusion regarding who is in charge -- the project manager or functional manager -- regarding specific decisions.

While matrix teams may make use of shared synergies, there must be a clear demarcation of responsibility. Communication difficulties can also result because different parts of the organization are blended. And merging different personalities from different functional aspects of the firm, such as advertising and IT, can create conflict.

To minimize these communication difficulties, a matrix firm should have standard operating procedures for orientating all new team structures in the different interpersonal 'styles' of team members, such as having them take a Myers-Brigg personality trait inventory beforehand, and discuss the result collectively. The impermeable divisions in a multidivisional firm can also create problems -- barriers to shared knowledge, for example. The battery division might be manufacturing in a manner to minimize waste, but not using its data to help the pet division.

A marketing campaign might stress sustainability, but the technical department of R&D might not be concerned with environmentalism at all. A lack of.