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PROJECT MANAGEMENT

By: Najmus Saqib Rehmani

Project Organizations
19/02/2016

Project Organization
A project organization is a structure that facilitates the
coordination and implementation of project activities.
Its main reason is to create an environment that
fosters interactions among the team members with a
minimum amount of disruptions, overlaps and conflict.
One of the important decisions of project management
is the form of organizational structure that will be used
for the project.
Each project has its unique characteristics and the
design of an organizational structure.
A project structure can take on various forms with
each form having its own advantages and
disadvantages.

Types of Project Organizations


There are two fundamentally different ways of

organizing projects within the parent organization


The project as part of the functional

organization
The project as a free-standing part of the parent

organization
A third type, called a Matrix Organization is a

hybrid of the two main types


Each has advantages and disadvantages

Functional Organization
Afunctional organizationis a common type oforganizational
structure in which theorganizationis divided into smaller
groups based on specializedfunctionalareas, such as IT,
finance, or marketing.

President/ CEO

VP
Finance

VP
Marketing

VP
Manufacturing

New
Layout
Robot Line

VP
Engineering

Part of the Functional


Organization
Advantages of using the functional elements of the

parent organization as the administrative home for a


project include:
Maximum flexibility in the use of staff
Individual experts can be utilized by many different

projects
Specialists in the division can be grouped to share
knowledge and experience
The functional division also serves as a base of
technological continuity when individuals choose to leave
the project
The functional division contains the normal path of
advancement for individuals whose expertise is in the
functional area

Disadvantages of the Project as


Part of the Functional Organization
There are also disadvantages to housing the project

in a functional area:
The client is not the focus of activity and concern
The functional division tends to be oriented toward the

activities particular to its function


Occasionally, no individual is given full responsibility
for the project
There are often several layers of management
between the project and the client
There is a tendency to sub optimize the project

Pure Project Organization


An organization in which the project is separated from
the rest of the parent system. It becomes a selfcontained unit with its own staff.

Advantages of Pure Project Organization


The project manager has full line authority over the project
All members of the project work force are directly

responsible to the project manager


When the project is removed from the functional division, the
lines of communication are shortened
When there are several successive projects of a similar
kind, the pure project organization can maintain a
permanent cadre of experts who develop skills in specific
technologies
A project team that has a strong and separate identity and
develops a high level of commitment among its members
Because the authority is centralized, the ability to make a
swift decision is enhanced. Unity of command exists
The organizational structure tends to support a holistic
approach to the project

Disadvantages of Pure Project


Organization
Each project tends to be fully staffed which can

lead to a duplication of effort in every area from


clerical staff to technological support
The functional division is a repository of technical
lore, but it is not readily accessible to team
members of the pure project team
In a pure project organization, the project takes on
a life of its own
There tends to be concern among team members
about life after the project ends

The Matrix Organization


The matrix organization is a combination of functional

and pure project


A matrix organization can take on a wide variety of
specific forms
Project or strong matrix organization most
resembles the pure project organization
The coordination or functional or weak matrix
most resembles the functional form
The balanced matrix lies in between these

The Matrix
Organization
Rather than being a stand alone organization, like the

pure project, the matrix project is not separated from the


parent organization:

Advantages of Matrix Organization


The project is the point of emphasis
Because the project is overlaid on the functional

divisions, the project has reasonable access to the


reservoir of technology in all areas
There is less anxiety about what happens when the
project is completed
Matrix management gives the project access to
representatives from the administrative units of the
parent firm
The matrix organization allows a better company-wide
balance of resources to achieve goals
There is a great deal of flexibility in precisely how the
project is organized within the matrix

Disadvantages of Matrix
Organization
The balance of power between the project and

functional areas is very delicate


The movement of resources from project to project may
foster political infighting
Problems associated with shutting down projects can
be as severe as in a pure project organization
The division of authority and responsibility in a matrix
organization is complex, and uncomfortable for the
project manager.
Matrix management violates the management principle
of unity of command. Project workers have at least two
bosses, their functional heads and the project manager.

Mixed Organizational
Systems
Divisionalization is a means of dividing a large

organization into smaller more flexible units


This enables the parent organization to
capture some of the advantages of small,
specialized organizational units while retaining
some of the advantages that come with larger
size units

Mixed Organizational Systems


Pure functional and pure project organizations

may coexist in a firm

Mixed Organizational Systems


Advantages of a mixed organization:
The hybridization of the mixed form leads to

flexibility
The firm is able to meet special problems by
appropriate adaptation of its organizational
structure
Disadvantages include:
Dissimilar groupings within the same accountability
center tend to encourage overlap, duplication, and
friction because of incompatibility of interests
Conditions still exist that result in conflict between
functional and project managers

Choosing an Organizational
Form
Selecting the organizational interface between

the project and the firm is a difficult task


The choice is determined by the situation, but is

also partly intuitive


Must consider the nature of the potential project,

the characteristics of the various organization


options, the advantages and disadvantages of
each, the cultural preferences of the parent
organization, and then make the best compromise
that can be made

Choosing an Organizational
Form
Criteria for the selection of a project
organization:
1. Define the project with a statement of
the objective(s) that identifies the major
outcomes desired
2. Determine the key tasks associated with
each objective and locate the units in the
parent organization that serve as
functional homes for these types of

Choosing an Organizational
Form
Criteria for the selection of a project

organization (contd):
4. Determine which organizational units are
required to carry out the work packages
and which units will work particularly
closely with which others
5. List any special characteristics or
assumptions associated with the project
6. In light of items 1-5, and with full
recognition of the pros and cons associated
with each structural form, choose a

The Project Team


To staff a project, the project manager works from

a forecast of personnel needs over the life cycle


of the project
A work breakdown structure (WBS) is prepared to

determine the exact nature of the tasks required to


complete the project
Skills requirements for these tasks are assessed and
like skills are aggregated to determine work force needs
From this base, the functional departments are
contacted to locate individuals who can meet these
needs
Certain tasks may be subcontracted

The Project Team


There are some people who are more

critical to the projects success than others


and should report directly to the project
manager or the project managers deputy:
Senior project team members who will be

having a long-term relationship with the project


Those with whom the project manager requires

continuous or close communication


Those with rare skills necessary to project

success

Human Factors and the Project


Team
Meeting schedule and cost goals, without

compromising performance is a technical


problem, with a human dimension
Project professionals tend to be perfectionists
Pride in workmanship leads the team

member to improve (and thus change) the


end result
These changes sometimes cause delays in

the project

Human Factors and the Project Team


Motivating Project Team Members:
The project manager often has little control
over the economic rewards and promotions of
project team members, but this does not mean
he/she cannot motivate members of the team
How are technical employees motivated?
o Recognition
o Achievement
o The work itself
o Responsibility
o Advancement
o The chance to learn new skills

Human Factors and the Project


Team
Empowerment of project teams is

also a motivational factor:


1. It harnesses the ability of the team
members to manipulate tasks so that
project objectives are met. The team is
encouraged to find better ways of doing
things
2. Professionals do not like being
micromanaged. Participative
management does not tell them how to
work but given a goal, allows them to
design their own methods

Human Factors and the Project


Team
Advantages of Empowerment (cont.):
4. There is a good chance that synergistic
solutions will result from team interaction
5. Team members get timely feedback on
their performance
6. The project manager is provided a tool
for
evaluating the teams
performance

Interpersonal Conflict
The focus of conflict can often be related to the

stage in the projects life cycle


When the project is first organized, priorities, procedures

and schedules all have roughly equal potential to cause


conflict
During the buildup phase, priorities become significantly
more important than any other conflict factor
In the main program phase schedules are the most
important cause of conflict followed by technical
disagreements
At the project finish, meeting the schedule is the critical
issue

Interpersonal Conflict
Conflict and the Project Manager
Most of the conflict on project teams is the result

of individuals focusing on the project through the


eyes of their individual discipline or department
Conflict avoiders do not make successful project

managers
On occasion, compromise appears to be helpful,

but most often, gently confronting and resolving


the conflict is the method of choice, for a win-win
situation

Authorities Linked to Various


Matrices

Questions
?

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