matrix organization

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A management structure in which some employees report to two (or more) managers in different departments. It is often used if two separate areas of the external environment demand management attention. For example, if a wholesaler of an organization's product requires extra credit, the distribution management and the finance management would both need to be consulted. In effect, this would involve the employees concerned in a multiple-authority structure rather than a simple chain of command (see diagram).

Matrix organization.

Subjects: Business and Management.

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