Chapter 14: Organizational Structure

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Chapter 14 Organizational Structure
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Different ways to organize

• Formal x Informal organizational structure
• Organogram Formal organizational structure.
  Example. Page 435.
• All organizations have vertical (formal) and
  horizontal relationships (friendships, personal
  contacts, informal relationships).

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Types of Organizations

• Traditional (Functional)
• Project
• Matrix

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Functional Organization (Traditional)

• Functional Manager takes the project under
  his/her department.
• Functional Manager manages routine activity and
  the project at the same time.
•  
• Main Advantage functional manager has total
  flexibility to shift staff from a routine
  activity to a project activity, vice-versa.
  Example at the beginning of the project, staff
  allocated to the project may not have much to do,
  so functional manager switches them to routine
  activity.
•  
• Main Disadvantage priority is often given to
  routine activity and the project may never ends.

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Traditional Forms of Organization

• Functional
• Geographic
• Product
• Customer
• Process

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Project Organization

• The project manager is responsible just for the
  project. He/She doesnt have any routine activity
  (separated from the main system). Employees are
  allocated exclusively to the project.
•  
• Main Advantage PM and staff do not lose focus by
  interrupting their activity for routine activity.
  It is usually in the best interest for the
  project.
• Main Disadvantage hard to shift people. During
  many parts of the project, PM or staff members
  may have reduced activities, resulting in lack of
  productivity for the firm.

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Matrix Organization

• Combination of functional organization and
  project organization.
• Example of a Matrix Project Manager is allocated
  exclusively to the project and Some ot the staff
  is allocated exclusively to the project while
  another part of the staff may be allocated
  part-time.

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Different types of PM

• Project Expeditor (p.441) (just a facilitator)
• Project Coordinator (No line of authority,
• But can make decisions about budgets)
• Project Manager (full autority, Project manager
  in a Project Organization).

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Quiz

• Advantages and Disadvantages of Project and
  Matrix ?
• Which is the best type of organization ?

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Conclusion

• The best organization depends on the companys
  size, type of business and goals
• Many companies have projects that are under a
  functional organization, projects that are under
  a project organization and projects that are
  under a matrix organization
• at the same time