Matrix Organization Process Reengineering for Construction Firms

Abstract

The matrix organization (MO) is widely used in construction project management. MOs contain two independently operating suborganizations, namely, functional organization (FO) and project organization (PO). FO and PO operations and integration are a frequent source of difficulty for construction firms and often result in MOs failing to achieve expected results. Risk of failure is particularly high when project processes are poorly organized. Single-loop and double-loop knowledge management (KM) learning can be used to analyze FO and PO business-operation processes to identify process effectiveness and service gaps by a knowledge/activity/process-target achievement matrix sheet. This study describes a MO process in terms of an architecture of integrated information system and proposes a new MO process reengineering (MOPR) approach using business process reengineering and KM methodologies. Although there is the problem of deteriorating communication resistance (CR) between parties during project execution in MO, this study demonstrates that, despite deteriorating CR in MO, the efficiency of the proposed process remains within acceptable parameters, as measured by proposed process value (PV). A procurement management case study is used to illustrate and validate the developed MOPR model. The PV of the developed KM-oriented MO process is significantly better than that obtained using the traditional process.