Ch 15: Project Organization Structure and Integration Flashcards
Organisational structure shows
organisational activities, divisions, and subdivisions
management hierarchy and reporting lines
official authority lines and communication lines
organisation structure depends on
the organisation’s goals
type or work
resources environment
6 ways that organisation differentiate into subunits
Functional differentiation Geographical differentiation Product differentiation Customer differentiation Process differentiation
Functional differentiation
Organization divided into subunits such as marketing, finance, production and human resources
Works well in repetitive, stable environments
Geographic differentiation
Organisation subdivides this way to adapt themselves to unique requirements of local customers, markets, suppliers, adversaries, etc.
Product differentiation
For firms with a variety of product lines
Integration between subunits limited
Process differentiation
Differentiated based on process or sequence of steps§
Project environments are characterised by
frequent change
distinctive problems
uncertainty
Project integration into business must happen on 2 levels
1) Integration of subunits in Projects
2) Integration and liaison of roles and teams
Projects within one functional area
Managed by the project expeditor
someone selected by the manager of the area wherein the project lies
coordinates decisions, creates and monitors signals and keeps project moving and manger updated about progress
Multifunctional project teams
Include representatives from all departments
Managed by project coordinator
Report to higher level manager
Concurrent engineering
eliminates cross-functional boundaries and can result in higher quality and lower cost
Pure Project Organisations
Projects that involve much complexity, major resource commitments, and high stakes
Pure project is a separate organisation
structure is 100% committed to the project
has its own pure project manager
- has formal authority and maximum control
- can tap from internal resources or hire contractors
Advantages of Pure Project Organisations
Higher team spirit Speed of execution Fast decision making Flexibility Autonomy
3 variations of Pure Projects
1) Project Center
- structure of parent organisation remains the same and additional project arm
2) Partial Project
- functions critical to the project are assigned to the PM, the rest remain in the functional areas
3) Stand-alone Project
- entire organisation created especially for the purpose of accomplishing the project
Disadvantages of Pure Project Organisations
High costs –> resources are 100% committed to projects
No functional managers –> no emphasis on competency development
Pure project organisations are temporary –> fate of project teams and PM is uncertain
Matrix Organisations
need the capability to create large project teams quickly without the personnel and cost disadvantages associated with pure project organizations
specifically for multi project organisations
a functional organisation with the ability to cross functionally tap from resources throughout the organisation (from a central point of project control)
Main benefit of Matrix Organisations
Combined horizontal and vertical integration
Drawbacks of Matrix Organisations
Power conflict between project managers and functional managers
- PM have a say in what should be done
- Functional managers have a say in how tasks should be done
Project support or resources confused; juggle between two bosses
Criteria for selecting an organisational form for projects
- Frequency of new projects
- Duration of projects
- Size of projects
- Complexity of relationships
Complexity = high
Size = large
Duration = long
Occurrences of new projects = Frequent
Pure project
Complexity = medium
Size = medium
Duration = short
Occurrences of new projects = between frequent and infrequent
Multifunctional task force
PMO
Project Management Office
Project Office
Support staff group that assists in project management and reports to the PM
