Project Management: Different Organizational Structures - Essay Example

Different Organizational Structures Before going to compare three primary project management organizational structures, which are functional, matrix, and pure project, let us get a better understanding of what organizational structure actually is. Sullivan (n.d.) states, “An organizational structure is the term used to define how employees of a company work together to support their mission”. There are several types of organizational structures depending on the nature of the organizations and types of the projects. Some of the basic types of organizational structures include functional, matrix, and pure project. “The purpose of an organizational structure is to clearly define roles and responsibilities” (Sullivan, n.d.). A well-defined organizational structure makes the employees and the managers aware of their roles and responsibilities regarding completion of the missions. Let us now discuss three primary project management organizational structures in order to get a better understanding of the situations in which each of these structures serve best to manage the project teams. Functional Organizational Structure Functional organizational structure is the most commonly used form of structures in which the decision-making authority remains at the top management level and the projects are assigned to the functional units based on the types of the projects. In functional organizational structure, there is strong concept of subordination and the focus of the management is towards jobs. The function-based jobs, which are similar in nature, are grouped together in such a way that they form a separate department. In functional organizational structure, the employees of each department have unique set of roles and responsibilities, which make their duties different from the employees of other departments. For example, the employees of the human resource department perform the tasks of hiring and training, whereas the employees belonging to the operations department deal with different types of business operations, activities, and functions. Some of the main characteristics of functional organizational structure include well-defined chain of command, formation of separate departments, strong concept of subordination, centralized decision-making, concentrated leadership, professional similarities between the employees belonging to any specific department, well-defined progress path for the employees, and clearly defined roles and responsibilities. Along with many considerable benefits, there also exist some negative aspects of the functional organizational structure. Some of the most negative aspects include bureaucratic style of decision-making, inefficient problem solving among the employees, lack of client focus, ineffective flow of communication between any two departments of the company, narrow vision of organizational goals and objectives. The situation where functional organizational structure can be the best method to manage a project team is one in which increased efficiency of workforce is required. This type of organizational structure work best in stable work environments where the managers do not change the business strategy or approach towards the completion of mission very frequently. Therefore, if managers of a company need to complete a project in the given deadline without changing the business strategy, functional organizational structure can be the best option because in this situation, employees of all departments are aware of their roles and responsibilities and the hired specialists can share their knowledge and experience for the completion of the projects. Matrix Organizational Structure The matrix organizational structure is the most commonly used form of organizational structures for the project-based teams. It is basically the merger of functional and pure project organizational structures. The difference between matrix organizational structure and functional organizational structure is that matrix structure groups the teams not only on the basis of their departments but also depending on the products of the teams, whereas functional structure groups the teams in the form of departments on the basis of their nature of jobs. The grouping of departments and products allows exchange of information between different parts of the organization. “With project-based teams, employees are divided by both function and by products or projects to increase knowledge sharing across the company” (Lava, 2010). The matrix organizational structure focuses on teams instead of departments and the team members are supposed to obey their team managers for the completion of projects. In a company having matrix structure, the upper echelon is always the top manager who controls all aspects of the project by commanding and assisting the project managers of different branches of the company. One of the main differences between functional and matrix organizational structures is that in functional organizational structure, different departments of a company do not work in collaboration with each other, rather they work separately to achieve a common goal. Whereas in case of functional organizational structure, the departments work in proper collaboration with each other and proper communication takes place between the employees of different departments. The situation where matrix organizational structure can be the best method to manage a project team is one in which diverse technical lead is required for the completion of project, increased communication between the employees is required to complete the project efficiently, and employees can be selected according to the project’s requirements. In matrix structure, the main idea resides in the mind of the top manager and he/she communicates the idea to the employees through the project managers and the employees from different departments work together to convert the idea into reality. Pure Project Organizational Structure Apart from functional and matrix organizational structures, pure project organizational structure focuses purely on the projects. The project manager is responsible for all activities related to the completion of the project. The project manager has complete authority regarding the project and he/she needs to communicate directly with the program manager to get assistance and to report the accomplishments. Some of the main qualities of pure project organizational structure include project focus, unity of command, complete authority to project managers, and shortened lines of communication. The situation where pure project organizational structure can be the best method to manage a project team is one in which the project has a long deadline and a self-contained unit with separate staff is required to complete the project. Pure project structure can work best in this situation because there is no deadline pressure and the project manager of a self-contained unit manages the project properly by managing all activities of the employees working towards the completion of the project. References Sullivan, J. (n.d.). What Is an Organizational Structure?. Retrieved from http://www.wisegeek.com/what-is-an-organizational-structure.htm Lava, S. (2010). What is a Matrix Organization Structure?. Retrieved from http://www.ehow.com/facts_6778670_matrix-organization-structure_.html Read More