Functional vs Projectized vs Matrix Organizations for PMP Exam

In the PMP Exam, one of the most fundamental questions a PMP Aspirant will be asked is to distinguish between the type of organization with reference to project management and organizational structure. Organizations can be broadly divided into three general types: Functional, Projectized and Matrix (midway between Functional and Projectized). Knowledge about the type of organization is vital to project success as the project management approach will be dependent on the type of organization in which the Project Manager is working in.

Functional, Projectized and Matrix Organizations

• Functional Organization: Functional organizations are organized around the functions the organization need to be performed.
  • Functions include: Human Resources, Information Technology, Sales, Marketing, Administration, etc.
  • This is the traditional structure of organizations
  •  The “Project Management” role will be performed by a team member of a functional area under the management of a functional manager
    • Resources are controlled and authorized by functional managers
    • The “Project Management” role would act more like a “Project Co-ordinator” or “Project Expediter” who do not usually carry the title of “Project Manager”
    • Project Management is considered a part-time responsibility
    • Authority of the “Project Manager” is very limited
• Projectized Organization: Projectized Organizations are organized around projects for maximal project management effectiveness.
  • The Project Manager is given more authority and resources control
  • The Project Manager is responsible to the Sponsor and/or Senior Management
  • The Project Manager is usually a full-time role
  • Team members are usually co-located within the same office / virtually co-located to maximize communication effectiveness
  • There can be some functional units within organization, however, those units are having a supportive function only without authority over the project manager
• Matrix Organization: Matrix Organizations are organizations with structures that carries a blend of the characteristics of functional and projectized organizations.
  • Matrix organizations can be classified as weak, balanced or strong based on the relative authority of the Functional Manager and Project Manager
  • If the “Project Manager” is given a role of more like “Project Co-ordinator” or “Project Expediter”, then the organization is considered “Weak Matrix”
  • If the “Project Manager” is given much more authority on resources and budget spending, the organization is considered “Strong Matrix”
  • The differentiations between Funcational Organization vs Weak Matrix and also Projectized Organization vs Strong Matrix are not very clear cut

Illustrated Example

In order to easily differentiate between the different types of organizations, the following table is drawn to provide an overview comparison between Functional, Projectized and Matrix (Weak, Balanced, Strong) Organizations:

In the PMP Exam, Aspirants are advised to look for the descriptions on the AUTHORITY of the Project Manager in order to help understanding the type of organization structure the project is being performed in.

Additional FREE PMP resources: 47+ Commonly Confused Term Pairs with detailed explanations. If you found this article useful, you may wish to reference other Commonly Confused Term articles.