Organizational Structures

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Why important?

• Authority of Project Manager

• Roles and responsibilities of Team
members
• Availability and allocation of project
resources
• Reporting Procedures
• Collocation of project team members

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Organizational Structures
• There are three key types of organizational
structures
- Functional
- Projectized
- Matrix

The Matrix structure can be further classified into

a weak Matrix structure / Strong Matrix and a
Balanced Matrix structure.

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Functional Organization
• The traditional hierarchy in which the staff
members are grouped together by specialty such
as marketing, engineering, sales, HR, etc.
• Straight and simple reporting structure
• each employee has a clear superior.
• Most widely used in the world even today.
• Functional organizations are better equipped to
handle low risk and relatively low cost projects

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Functional Organization

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Functional Organization - Strengths
• Career paths for all members are clearly defined
which keeps them motivated.
• Resources are centralized which means they can be
used more effectively.
• All persons report to one boss ( Functional Manager),
So good control
• Vertical communication channel well structured.
• Have a strong base of specialists who are grouped
together by their specialty.
• Procedures, policies and responsibility structure are
well established

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Functional Organization - Weakness
• Project Manager has no formal authority and little
control.
• Team members are not committed, being more
involved in their own routine work rather than the
project.
• Communication between project team members is
not good.
• Little commitment from team members for the
project.

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Projectized Organization
• Projectized organizations are project
oriented structures.
• In such an organization the project manager
has maximum authority and independence
for the project.
• Generally the whole organization and the
organization's resources are involved in the
project work.

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Projectized Organization

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Projectized Organization - Strengths
• PM has complete authority and control over project and
resources.
• Permits quicker reaction / response.
• Improved communication
• Encourages commitment
• PM focal point freeing administrative heads.
• Better coordination with customer (single point contact).
• High morale as team is working for common goal.

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Projectized Organization - Weakness
• Duplication of resources in terms of both human and
equipment resources.
• No defined career growth.
• Loyalties are project oriented rather than corporate
oriented.
• Moral and performance decreases near project
termination.
• Less communication between different projects. So,
little benefit from each other’s experiences

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Matrix Organization
• Matrix organizations maintain the vertical lines
of authority of a Functional organization and at
the same time there is a horizontal structure
that is used to support project work.
• Matrix organizations were formed keeping in
view the need to undertake multiple projects
without having to duplicate resources

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Weak Matrix Organization

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Strong Matrix Organization

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Balance Matrix Organization

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Matrix Organization - Strengths
• Combines best of function and project organizations.
• Reduces duplication of resources ( shared).
• Better morale as people have functional job.
• Clear career development path ( Motivated).
• Knowledge and resource accessibility to all
programs.
• Good balance between time, cost and quality
performance

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Matrix Organization - Weakness
• Blurred line of authority represents potential
conflicts. (functional head v/s PM)
• Greater competition for available resources.
• Difficult to maintain confidentiality of project.
• Individuals now have two bosses.
• Response time slower than Functional organization
• Senior Management involvement required for
balance between FM and PM.

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Project stage - Management Style - Team Structure

• Feasibility – Laissez Faire – Egoless

• Design – Democratic – Matrix

• Implementation – Autocratic – Task Hierarchy

• Close out – Bureaucratic – Task Force

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Organizational Structures

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Wishing You All The Best!

Thank you.

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