Project OrganizationProject OrganizationPrepared By : Mohd Samim Faizy

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Learning Objectives

Project OrganizationProject as Part of Functional OrganizationPure Project OrganizationMatrix OrganizationStaff OrganizationProject TeamKey Team MembersHuman Factors

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Project Organization

• Specialization of the human elements• Different types = functional, product line,

geographical location, production process, type of customer, subsidiary organization, time, vertical or horizontal organization

• How to tie project to the parent firm• How to organize the project itself

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Project as Part of Functional Organization

• E.g. new technology project – under voice president of engineering

• Introduction of new product line – under voice president of marketing

• Project assigned to the functional unit that has most interest

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Major Advantages

• Maximum flexibility in the use of staff• Individual experts can be utilized by many different

projects• Specialist in the division can be grouped to share

knowledge and experience• Functional division serves as a base of technological

continuity• Functional division contains normal of advancement

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Disadvantages

• The client is not the focus of activity and concern• No individual is given full responsibility for the

project• Slow response to client’s needs• Tendency to sub-optimize the project• Motivation of project team is weak• Does not facilitate a holistic approach to the project

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Pure Project Organization

• Project is separated from the rest of the parent system

• Becomes self contained unit

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Advantages

• PM has full line authority over the project• All project workforce directly responsible to the PM• Lines of communication are shortened• Maintain permanent group of experts• High level of commitment• Ability to make swift decisions• Unity of command• Simple and flexible structure

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Project Organization

F in an ce M a nu fa c tu ring

V ice P re s id en t P ro je c t A

F in an ce M a nu fa c tu ring

V ice P re s id en t P ro je c t B

F in an ce M a nu fa c tu ring

V ice P re s id en t P ro je c t C

P re sid e n t

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Disadvantages

• Duplication of effort• Lack of expertise in high technology project• Foster changeability and cutting corners• Project takes on a life of its own• Worry about “life after project ends”

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Matrix Organization

• Combination of functional and pure project organizations

• Matrix project is not separated from parent organizations

• Individuals come from respective functions divisions and are assigned to the project full time or part time

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Matrix Organization

• Cross-functional team members• Draw temporarily on technological expertise of

relevant functions• High technology areas – integrate functional

specialties• Systems approach – integrity of product design• Close coordination and communication among all

parties

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Staff Organization

• Set up like functional organization• Adds a staff office to administer projects• Used for small, short run projects

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Project Team

• Project office – control center, chart room (focus of all project activity)

• Close location to project manager• Co-location of external parties• Reduce physical distance• Better communication• Pressure to complete tasks

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Key Team Members

• Project Engineer• Manufacturing Engineer• Field Manager• Contract Administrator• Project Controller• Support Services Manager

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Work Organization

• Project engineer (technical performance) and project controller (budget) report to PM

• PM forecast of personnel needs• Skills requirements are assessed and aggregated• Outsourcing of certain tasks

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Human Factors

• Technical problem with a human dimension• Perfectionist – can cause delay• Motivation – recognition, achievement,

responsibility, advancement, the work itself• Interpersonal conflict• Management by Objectives (MBO) – allows worker

to take responsibility for design and performance of a task

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Chapter 4 Project Organization 18