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CMA Intermediate · Operations Management and Strategic Management · Formulation and Implementation of Strategy

An engineering firm in Pune staffs each client project with engineers who report both to their functional head (design, procurement) and to a project manager for the project's duration. What is the main drawback commonly associated with this structure?

The main drawback is possible conflict and confusion arising from dual authority, since employees report to both a functional head and a project manager. This is the matrix structure. Its strengths include specialisation and flexible resource sharing, so those options describe benefits, not drawbacks.

  1. ALack of specialisation among employees
  2. BPossible conflict from dual authority and unclear reportingCorrect
  3. CInability to share resources across projects
  4. DExcessive centralisation of all decisions at the top

Explanation

Dual reporting to a functional head and a project manager defines a matrix structure. Its typical weakness is role confusion and power conflict from two bosses. Resource sharing and specialisation are actually strengths of a matrix, so those options are wrong.

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