Organization Structure

In the previous chapters we saw what is a project and the life cycle of the project. In this Chapter we will see what is a Project team its different structures, its Pros and Co

Project Team 
Let us start this by asking a question.. As a project Manager, with whom did you interact in your last projects?
 You will rightly recollect 1)Developers2)Business Analyst 3)Architects 4)DBA/ADBAs 5)Network/Server engineers6)Testers7)End Users. 8)Customers.

You will also remember 1)Project Sponsor 2)Change Board 3)Other Project team that has a interface/influence 4)Sub contractors 5)Vendors

You will also not forget 1)The Admin/Infrastructure 2) Human resource 3)Finance 4) Procurement/Contract approval teams.

In a simple word we call them all as Stakeholders.You should also not forget any one who will be impacted directly or indirectly, positively or Negatively by the outcome of the Project.

You should note that I have included even those who are negatively influenced / impacted as stakeholder for the Project ? Why?. For Ex let us say you are doing a project to implement a ERP solution for your business. After the completion of the project, there are fair chances to lay off those who are currently working on the existing Legacy application and hire/retain experienced ERP package professionals.

But, for you to do a successful ERP package implementation, it is necessary you get required inputs from the experienced legacy team for ex. on the extraction of business Rules. Unless there is a understanding on their future plans , their support to the project is very minimal.  So, care should be taken on everyone who will be positively or negatively impacted by the project and included as stakeholders and their requirements/concerns addressed.
 
The role, responsibility and authority of the stakeholders vary much. This will be discussed in detail in the Human Resource chapter .

Team Organization

Though the success and failure of a project is a complete responsibility of the Project Manager, depending on the Organization structure there can be some limitations that a Project Manager can exercise and influence his team.

Broadly, an organization can structure a team in 3 different ways. 1)Functional ,2)Projectized and 3)Matrix.

Functional.

In a functional Organization, Specialization is centralized.   Employees who are doing these specialized jobs are grouped together to for work department.
For Ex. such a model will have a Purchase department concentrating on purchase, Human resource dept working on Hiring, Training and Firing, and similarly there may be a accounting dept for taking care of financial and also Manufacturing or Sales dept specialized in their respective areas. Each dept has a dept Manager/Director as the head.

Where?
Functional organizational structures are ideal for organizations having a lone product or a cluster of products which can easily group under a single head.

There is no Project Manager if a functional Organization.

Sometimes there are project that requires resources from across departments. In such situations, in a Functional Org, a project coordinator or a Project expediter may be working in the project.
There are only limited powers for such a role.  The staff involved in the project work, still reports to their respective functional Managers.
Expediter merely acts as a staff assistant and does not make any decisions , whereas the coordinator has some powers to take decisions, some authority and sometimes reports to a Senior Manager level.

Projectized

Quite opposite to a functional organization is a Projectized structure. Here the resources are not grouped by functionality or specialization but according to the requirement of the project. The resources may be with different functional/technical background but are grouped together to work for that particular project.  Here the project Manager is complete responsible for the project and also the resources and he is full empowered. A project manager enjoys the most power in this type of Org structure.
This is the most common I have seen in IT project management. All developers irrespective of the technology say JAVA or MF or .NET or Business Analyst , Tester etc all work in a project and report to the Project Manager.

Before you read further, take a paper & pencil and try out to list the advantages and disadvantages. !!
Functional
Major Advantages:

• High quality technical problem solving
• In-depth training and skill development within functions
• Clear cut career paths within functions

Major Disadvantages:

• Poor communication and coordination across functions,
• Decisions referred upward in the hierarchy,
• A loss of clear responsibility for product or service delivery 

Projectized
Major Advantages:

• Greater flexibility in responding to environmental changes
• Improved coordination across functional departments
• Clear points of responsibility for product or service delivery

Major Disadvantages:

• May reduce economies of scale, disperse technical competence and expertise
• May also increase costs by duplicating resources and efforts across divisions 

Matrix
There are other type of structures that gives an option to overcome the disadvantages we saw in Functional or Projectized structure. This has been classified into 3 types based on the Power shared between the Functional and Project Manager.

The power gradually transfers from Functional to Project Manager from Weak to Balanced to Strong Matrix.
In balanced Matrix, the powers are equally shared between the Functional and the Project Manager.
In a week matrix the role of the project manager is almost that of a project coordinator or project expediter.
In a Strong Matrix, the Project Manager reports to the PMO or to senior Management,.
A matrix structure does have some disadvantages, the major being the team members has to report to two Managers creating  frustration with the question of where to keep their loyalty? It would also create some clash of interest between the managers and resource being pulled between project / functional priorities.

Irrespective of the project structure, the are a set of standard operating procedures or Framework laid down for the Project Managers to execute a project. 

In the Next chapters, we will study the PBMOK project management framework