organizational structures 3

1. Engr. Muhammad Niqash
Presentation

2. The traditional management structure has
survived for more than 2 centuries.
However, recent business developments,
such as rapid change in technology and
increased stake holders demands , have
created strains on the existing
organizational forms.
Project Organizations

3. It refers to the way that an organization arranges people
and jobs so that its work can be performed and its goals
can be met.
The relationships among these positions are illustrated
graphically in an organizational chart ,The best
organizational structure for any organization depends on
many factors including the work it does; its size in terms
of employees, revenue, and the geographic dispersion of
its facilities; and the range of its businesses .
Organizational structure

4. An organizational chart : is a diagram that shows the
structure of an organization and the relationships and
relative ranks of its parts and positions/jobs.
It usually shows the managers and sub-workers who make
up an organization.
It shows the relationships between the the organization's
staff members.

5. There are several limitations with organizational charts:
It only shows 'formal relationships' and tells nothing of
the pattern of human (social) relationships which
develop.
It shows nothing about the managerial style adopted
e.g. autocratic or democratic
It very quickly becomes out-of-date, especially in large
organizations which change their staff regularly.
Limitations of an organizational chart

6. Organizational charts provide managers with specific
departmental information that can then be used as a
baseline for planning, budgeting and workforce modeling.
Charts can be linked directly to spreadsheets or
budgeting tools for interactive what-if analysis, making
planning and decision making easier.
Organizational charts are ideal for sharing the
organization's strategic vision, as well as defining
responsibilities, dependencies and relationships.
Allow you to organize your team with clear
responsibilities, titles and lines of authority
The Benefits of Organizational Charts

7. Unity of Command :
Each individual participating in the
operation reports to only one supervisor.
It eliminates the potential for individuals to receive
conflicting orders from a variety of supervisors.
Increasing accountability.
Preventing freelancing.
improving the flow of information, helping with the
coordination of operational efforts, and enhancing
operational safety.
Unity of Command

8. Span of Management:
Span of management (sometimes called span of
control) refers to the number of people one supervisor should
be in charge of.
Chain of Command : 
The chain of command is best known in the
military, where you must have approval from your supervisor
for each decision you make!

9. Till the recent past the companies were surviving
with only one or two product lines. The classical
management organization was satisfactory for
control, and conflicts were minimal.
However, with the passing time, companies found
that survival depended on multiple product line
(i.e., diversification) and vigorous integration of
technology into the existing organization.
Types of Project Organizations

10. By Function:
Arranging the business according to what
each section or department does
By Product or Activity:
Organising according to the different
products that are made
By Area:
Geographical or regional structure
Ways to Structure a Business

11. By Customer:
Where different customer groups have
different needs
By Process:
Where products have to go through stages
as they are made

12. Managers began searching for more innovative organizational forms
that would address the issues of control, conflict resolution etc.
Following different organizational structures were developed
 Traditional (classical) Organization
 Line-Staff Organization (Project Coordinator)
 Pure Project (Projectized) Organization
 Matrix Organization
Strong, Weak, Or Balanced Matrix

Types of Project Organizations

13. Traditional Organizations
Division
Department
Section
Traditional Management Structure
Functional
Responsibility

14. Advantages of traditional (Classical) Organizations
Easier Budgeting and Cost Control
Better Technical Control (specialists can be grouped
together to share knowledge)
Flexibility in the use of man power
Broad man power base to work with
Communication channels are vertical and well
established
Good control over the personnel
Traditional Organizations

15. Disadvantages of traditional (Classical) Organizations
 No one individual is directly responsible for the whole
project
Coordination becomes complex, and additional lead time is
required for approval
Decisions normally favors the strongest functional groups
No customer focal point
Response to customer needs is slow
Ideas tend to be functionally oriented with little regard for
on going projects
Traditional Organizations

16. In many ways this organizational form is not
distinguishable from matrix organization, but this
is typically used for small, short run projects
where the formation of full fledge matrix system
is not justified.
In this, the organization sets up what appears to
be a standard form of functional organization, but
it adds a staff office to administer all projects.
Staff Organization

17. Staff Organization
Staff Organization

18. The pure project organization develops a division within a
division. As long as there exists a continuous flow of projects,
work is stable and conflicts are at minimum.
The major advantage of this organizational flow is that one
individual, the program manager, maintains complete line
authority over the entire project.
Not only he assigns work, but also conducts merit reviews.
Pure Project (Projectized) Organization

19. Pure Project (Projectized) Organization

20. Advantages
Provides line authority over the project
Participants work directly for the project manager
Strong communication channels
Very rapid reaction time
Focal point develops for out of company customer
Flexibility in determining time, cost, and performance trade
offs.
Upper level management enjoys more free time for executive
decisions
Pure Project (Projectized) Organization

21. Disadvantages
 Tendency to retain personnel on a project long after
they are needed
Control of functional specialists requires top level
coordination
Lack of opportunities for technical interchange between
projects
Lack of career continuity and opportunities for project
personnel
Pure Project (Projectized) Organization

22. Like the pure project, the matrix project is not separated
from the parent organization. The matrix organizational
form is an attempt to combine the advantages of the pure
functional structure and the product organizational
structure.
This form is ideally suited for companies, such as
construction, that are “project driven”
Matrix Organization

23. Matrix Organization
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Project Responsibility

25. Advantages:
The project is the point of emphasis
Because the project is overlaid on the functional divisions, the project
has reasonable access to the reservoir of technology in all areas
There is less anxiety about what happens when the project is
completed
Response to client’s needs is as rapid as in the pure project
organization
Matrix management gives the project access to representatives from
the administrative units of the parent firm
The matrix organization allows a better company-wide balance of
resources to achieve goals
There is a great deal of flexibility in precisely how the project is
organized within the matrix

26. Disadvantages :
The balance of power between the project and functional areas is
very delicate
The movement of resources from project to project may foster
political infighting
Problems associated with shutting down projects can be as severe
as in a pure project organization
The division of authority and responsibility in a matrix
organization is complex, and uncomfortable for the project
manager.
Matrix management violates the management principle of unity of
command. Project workers have at least two bosses, their
functional heads and the project manager
Matrix Organization

27. Criteria for the selection of a project organization:
1. Define the project with a statement of the objective(s)
that identifies the major outcomes desired
2. 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
3. Arrange the key tasks by sequence and decompose them
into work packages
Choosing an Organizational Form

28. 4. Determine which organizational units are required
to carry out the work packages and which
units will work particularly closely with which
others
5. List any special characteristics or assumptions
associated with the project

29. To staff a project, the project manager works from a
forecast of personnel needs over the life cycle of the
project
A work breakdown structure (WBS) is prepared to
determine the exact nature of the tasks required to
complete the project
Skills requirements for these tasks are assessed and like
skills are aggregated to determine work force needs
From this base, the functional departments are
contacted to locate individuals who can meet these
needs
Certain tasks may be subcontracted
The Project Team

30. There are some people who are more critical to the project’s
success than others and should report directly to the project
manager or the project manager’s deputy:
Senior project team members who will be having a long-term
relationship with the project
Those with whom the project manager requires continuous or close
communication
Those with rare skills necessary to project success

31. Inspiring Project Team Members:
The project manager often has little control over the
economic rewards and promotions of project team
members, but this does not mean he/she cannot
facilitate motivation of team
How are technical employees motivated?
Recognition
Achievement
The work itself
Responsibility
Advancement
Learning new skills
Human Factors and the Project Team