4. the project in the organizational structure
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This document discusses organizational structures for managing projects. It describes how firms typically develop organizational structures as they grow, with a focus on specialization. Functional, projectized, and matrix organizational structures are described and their pros and cons for managing projects are discussed. The document also discusses challenges for project managers, including acquiring resources and dealing with uncertainty. It introduces the concept of a Project Management Office to help manage administrative and process issues for projects. Key factors in managing project teams such as political skills, motivation, and conflict resolution are also covered.
4. the project in the organizational structure
- 2. Organizational Structures A firm, if successful, tends to grow, adding resources and people, developing an organizational structure. Commonly, the focus of the structure is specialization of the human elements of the group. As long as its organizational structure is sufficient to the tasks imposed on it, the structure tends to persist. When the structure begins to inhibit the work of the firm, pressures arise to reorganize along some other line. The underlying principle will still be specialization, but the specific nature of the specialization will be changed.
- 3. Project-oriented Organizations In the past decade or so, there has been the development of applying project management practices and tools across an enterprise (sourced from the software industry) “enterprise project management” “managing organizations by projects” Reasons for growth: demands of speed and market responsiveness need for ad hoc specialists for development of new products, services, processes rapid expansion of technological possibilities tend to destabilize the structure of organizations many senior managers rarely feel much confidence in understanding and control of many activities in their organizations
- 4. Organizational Issues A decision must be made about how to tie the project to the parent firm. A decision must be made about how to organize the project itself. A decision must be made about how to organize activities that are common to other projects
- 6. 1. Projects in a Functional Organization Make it as part of one of the functional divisions of the firm, usually the function that has the most interest in ensuring its success or can be most helpful in implementing it. Another way is to assign the work to all the relevant functional divisions with either top management overseeing the effort or someone else assigned to coordinate their efforts.
- 7. JPES Initiating Structure (2010-11)
- 8. JPES Organizational Structure (from JPES-USLS Constitution)
- 10. Pros and Cons Advantages Disadvantages Maximum flexibility in the use Client is not the focus of activity and of staff Individual experts can be utilized for different projects Specialists in functional division can be grouped to share knowledge and experience Functional division serves as base for technological and overall continuity Functional division contains normal advancement; functional field is professional home concern; functional unit has own work to do Functional division tends to be oriented toward the activities particular to its function; not problem-oriented Occasionally, no individual is given full responsibility and accountability May have lack of coordinated efforts making response to client needs and concerns slow Tendency to sub-optimize the project Motivation of people assigned to the project tends to be weak Does not facilitate a holistic approach to the project
- 11. 2.Projects in a Projectized Organization
- 12. 12th YEC Visayas Convention Project
- 13. Basis for “Projectizing” Administrative mandate Common convention needs Draft MOA requirements (pls. refer to “Responsibilities and Tasking Word file)
- 14. Pros and Cons Advantages Disadvantages PM has full line authority over the project All members of the project work force are directly responsible to the PM When the project is removed from the functional division, the lines of communication are shortened When there are several successive project of a similar kind, the projectized organization can maintain a more or less permanent cadre of experts who develop considerable skill in specific technologies A project team that has a strong and separate identity of its own tends to develop a high level of commitment from its members If parent organization takes on many projects, considerable duplication of effort Tendency to stockpile technological knowledge and skills; experts are hired when available not when needed, very expensive when coupled with previous point Functional expertise may not be readily accessible to project team Inconsistency in the way policies and procedures are carried out; administrative corner-cutting Project takes on a life of its own: projectitis develops, which may distort relationships in parent organization
- 15. Advantages Disadvantages Ability to make swift Worry about “life after the decisions greatly enhanced Unity of command exists: better quality of life for subordinates with one and only one boss Structurally simple and flexible, easy to understand and implement Supports a holistic approach to the project project”
- 16. 3. Projects in a Matrixed Organization President Marketing Finance Program Manager Manufacturi ng R&D Personnel PM1 3 1.5 0.5 4 0.5 PM2 1 4 0.25 1.5 0.25 PM3 0 0.5 3 0.5 1 1. PM controls when and what people will do. 2. FM controls who will be assigned and how the work will be done.
- 17. Pros and Cons Advantages Disadvantages Project is the point of emphasis Reasonable access to the technical expertise of the functional divisions Less anxiety about what happens when the project is completed Response to client needs is as rapid as standalone project Access to representatives from the administrative units of parent firm Better companywide balance of resources May be strong or weak matrices: more flexible Delicate balance of power between FM and PM Movement of resources from project to project may foster political infighting Projectitis for strong matrices Negotiating ability of PM is crucial Violates management principle of unity of command with more than 1 boss: split loyalties and confusion
- 18. 4. Virtual Projects Work on the project team crosses time, space, organizational and cultural boundaries Creates overlapping and shared responsibilities for work (especially between PM and FM) Virtual positions – “task processes, the performance of which requires composite membership” (Kalu, 1993) in both project and functional organizations
- 19. Guidelines for Successful Virtual Projects Only use virtual teams for projects that are challenging and interesting. Also be sure the project is meaningful to the company as well as the team. Solicit volunteers as much as possible– they’ll be more enthusiastic and dedicated to the success of the project. Include a few members of the team who already know each other, and make sure 1 of every 6 or 7 are “boundary spanners” with outside contacts. Create an online resource for team members to learn about each other (especially how they prefer to work), collaborate, brainstorm and draw inspiration. Encourage frequent communication, but not social gatherings (which will occur at more natural times anyway). Divide the project work into geographically independent modules as much as possible so progress in one location isn’t hampered by delays in other locations.
- 20. Guidelines for Selecting a Project Form Define the project with a statement of the objective(s) that identifies the major outcomes desired. (see “Responsibilites and Tasking” Word file again.) 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 tasks. Arrange the key tasks by sequence and decompose them into work packages. List any special characteristics or assumptions associated with the project: Level of technology needed Probable length and size of the project Any potential problems with individuals who may be assigned to the work Possible political problems between different functions involved Parent firm’s previous experiences with organizing projects Anything else that seems relevant In light of the above and full cognizance of pros and cons associated with each structural form, choose a structure.
- 22. Key Project Management Challenges A primary task of the PM is to acquire the resources, technical skills, knowledge and whatever else is needed by the project, dependent on PM’s negotiating skills. Uncertainty is a way of life; need for risk management The successful execution of a project is a complex managerial task and requires the use of planning, budgeting, scheduling and control tools with which the neophyte PM may not be completely familiar. There are contractual, administrative and reporting duties that must be performed in accord with the law, the wishes of the client, and the rules of the organizational home of the project.
- 23. Project Management Office (PMO) Purposes: To deal with the managerial and administrative issues in a way that meets the parent organization’s rules for management and administration To help manage fast-multiplying forms of getting work done Many names: Project Office, Program Management Office, Project Support Office Best PMOs have common characteristics (Baker, 2007): Like best businesses (a business plan, focused, emphasis on results) Enjoy strong executive support Future-oriented learning organizations Offer best project leadership in the organization
- 24. Tasks (Block, 1999) Establish and enforce good project management processes such as procedures for bidding, risk analysis, project selection, progress reports, executing contracts and selecting software Assess and improve the organization’s project management maturity Develop and improve an enterprise project management system Offer training in project management and help project managers become certified Identify, develop and mentor project managers and maintain a stable of competent candidates Offer consulting services to the organization’s project managers Help project managers with administrative details such as status reports Establish a process for estimation and evaluation of risk Determine if a new project is a good “fit” for the changing organization Identify downstream changes (market, organization) and their impact on current projects Review and manage the organization’s project risk portfolio Conduct project reviews and audits, particularly early in each project’s life cycle, and report project progress relative to the organization’s goals
- 25. Tasks (continued) Maintain and store project archives Establish a project resource database and manage the resource pool Serve as a champion to pursue project management excellence in the organization and encourage discussion in the value of individual projects in the firm Serve as a “home” for project managers to communicate with each other and with PMO staff Collect and disseminate information, techniques and lessons learnedas reported in project evaluations that can improve project management practices Assist in project termination
- 27. Key Factors in Managing Project Teams PM’s high level of political sensitivity, negotiating and communicating skills, leadership Meeting schedule and cost goals without sacrificing performance – a technical problem with a human dimension Motivating project team members to accomplish the work of the project even with little control on economic rewards and promotions Judicious use of “thank you” notes with copies to relevant functional departments Use of participative management: workers play significant roles in what means should be employed in meeting desired ends, and in finding better ways of accomplishing things Handling interpersonal conflict