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A matrix organizational structure is a company structure in which the reporting relationships are set up as a grid, or matrix, rather than in the traditional hierarchy. In other words, employees have dual reporting relationships - generally to both a functional manager and a product manager.

This structure is widely used both by companies that are constantly launching new products and marketing campaigns, for example, and by companies that have project-based structures, but also believe that functional supervision is necessary and important.

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Hierarchy is a way to structure an organization using different levels of authority and a vertical link, or chain of command, between superior and subordinate levels of the organization. Higher levels control lower levels of the hierarchy. You can think of an organizational hierarchy as a pyramid.
Companies with hierarchical structures are efficient and well-coordinated, because the lines of authority are clear. In the modern marketplace, quick adaptability to changing conditions and varying customer requirements becomes increasingly important. A hierarchical organization does not respond quickly to such conditions, because decision-makers are remote from the working level. To achieve an effective organizational balance for the modern organization, you have to combine hierarchical elements with new, more flexible structures.

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A flat structure is where everyone in the business has the same power/ authority. This is usually used in smaller businesses that have recently started and have limited staff.

Collaborate within teams and with neighboring teams inside the organization.

Make decisions that directly affect their daily operations without necessarily consulting the higher leadership echelons at each step.

Try out new ideas and engage in innovative thinking on a regular basis.