Organizational Structure

• Dynamic Organization:
– WHAT: Rapid restructuring
• WHY: Changing environment
– BECAUSE OF:
» Market competitiveness
» Technology changes
» Customer demands
» ???

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 Organization Changes
• Organization
– Involves Human and Non-human Resources
– Sociotechnical issues
•Changes from situation to situation
•High standardization of performance
•High manpower utilization
•Specialization of work
Lower employee attitude & motivation

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 Work Flow
Accountability = Authority + Responsibility

Project Manager Functional Manager

Denial
Blames
Responsibility
Interaction
Proactive
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 Organization Structure
Traditional/
Projectized
Functional

Organizational Structure can be characterized as spanning

a spectrum from Functional to Projectized, with a verity of
structure in between

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 Traditional Organization
C EO

E n g in e e r in g O p e r a t io n F in a n c ia l
Division

Department

Section

Functional
Responsibility

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 Traditional Organization
• All project flow through Functional Manger
• Technical specialist
• Integration is a major problem
• Conflicts ; struggle of power b/w groups
• Top management focused and chain of
command
• Difficult to meet schedules
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 Departmental Project Management
D iv is io n M a n a g e r

D e p a rtm e n t"A " D e p a rtm e n t " B " D e p a rtm e n t "C "

P r o je c t L e a d e r P r o je c t L e a d e r P r o je c t L e a d e r

Conflicts are resolved through integration using

•Rules and procedures
•Planning process
•Hierarchical referral
•Direct contact
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 Line Staff Organization
D iv is io n M a n a g e r

P r o je c t M a n a g e r

D e p a rtm e n t M a n a g e r D e p a rtm e n t M a n a g e r

Give direct responsibility to the Project Manager

Alt #1: Project manager only monitor
Alt #2: Project manager has more authority; usually occurs earlier sages of
matrix project management

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 Pure Product Organization
G e n e ra l M a n a g e r

P ro d u c t "A " P ro d u c t "B " P ro d u c t "C "

M anager M anager M anager

E n g in e e r in g M a n u f a c tu r in g E n g in e e r in g M a n u f a c tu r in g E n g in e e r in g M a n u f a c tu r in g

Repetition of work
No interaction
Lack of career growth opportunity
Line Authority
Control require at top level
Strong communication
Good reaction/ response time
Flexibility in time, cost and other tradeoffs
Upper management === decision making
Interface become easier b/c of small size
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 Matrix Organization
G e n e ra l M a n a g e r

E n g in e e r in g O p e ra t io n s F in a n a c e O th e r

Proj. Mgr. X

Proj. Mgr. X

Proj. Mgr. X
Give
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 Matrix Organization
• A blend of functional and projectized
characteristics
• Weak matrix ==> more functional
• Strong matrix ===> more projectized; Full
time project managers have more authority

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