From Project Based to Matrix Organisation: A case study of a rapidly expanding generic pharmaceutical company in New Zealand

Abstract

The company under investigation (Beta) is rapidly growing which necessitated an organisational restructure in the Research and Development (R&D) department from project based to matrix style. A matrix structure is considered to have the capacity to sustain future company growth while retaining or improving R&D productivity and efficiency. Currently, there is no defined operational management system for the newly implemented matrix organisation in the main case company under study. Moreover, little empirical research has been achieved on how to operationally manage a matrix organisation and minimise potential matrix challenges. The purpose of this thesis is to identify best practice for the operational management of a matrix organisation design within a generic pharmaceutical company. To achieve this, the implementation and managerial challenges of a matrix organisation were investigated. To answer the research questions, semi-structured interviews were undertaken with employees from the main case company under study (Beta), and one participant each from two smaller complementary cases: Gamma and Delta. Additionally, one key informant experienced with matrix implementation and management was interviewed. Data was also collected by secondary analysis of company documents. As an intern based within the main case organisation, daily interactions with employees provided insight on the transition phase from a project based to matrix structure. This knowledge informed the design of the research questions. Using a case study approach, this study identifies important dimensions of successful matrix implementation. In addition, it draws on these challenges in order to provide guidance for future operational matrix management. The findings demonstrate that ambiguous roles and responsibilities, motivational loss, recruitment of talented project managers and measuring functional performance were the key challenges of a matrix. Factors such as training and guidance, emphasising communication, fostering collaboration, optimising project management, developing a performance management system for functional teams, reviewing the structure and providing incentives can mitigate these challenges and maximise the benefits of a matrix. To mitigate the challenges experienced in the main case company, tools and measures can be used for operational management, which include the RASIC tool, communication plans, and use of KPIs to measure performance. Further, the study suggests how the implementation of a matrix might be best facilitated in an organisation.