Project Organization | Types | Advantages | Disadvantages

Project organization structure

Project organization structure is found in industries with highly complex product systems, such as the aerospace or weapon industry. In this structure, project members are chosen for their special capabilities in the light of the goals to be accomplished from different functional departments, viz., production, engineering, quality control, marketing research, and marketing. When the project has been completed, this task force is dissolved and personnel are returned to their regular organization units.

Although the regular functional departments do not work, the project manager is responsible for the completion of the project. He specifies what is to be done, when it is to be done, and how much of the available resources are needed. The functional managers decide who in their units will do the work and how it will be done. The project organization, thus, is a complex structure that facilitates the coordination and integration of many project activities.

Authority of Project manager in project organization

Project organization is known as a grid or matrix organization because here, vertical flow of functional authority and responsibility is combined with the horizontal flow of project authority and responsibility. The project manager acts as a coordinator of all project activities and the work of different specialists lent by the functional departments. The project manager has authority over the functional managers regarding what, when and how much of the activities; the functional manager determines how support will be given and who will give the support.

Types of Project Organizations

There are four types of project organizations

1. An individual project manager to whom no one is required to report;

2. A unit project organization where the manager is provided unit help in scheduling and coordinating as well as supervising the funds of the project;

3. An intermix project in which some of the operative functions or existing departments are assigned full time to the project and others remain intact; and

4. the aggregate organization in which all activities and personnel are assigned to the project manager.

Advantages of Project Organization

1. It is an effective way of producing highly complex product systems.

2. Project organization, based on team concept, is the best means of getting the right things done right.

3. In a turbulent environment, such organization is preferable for planning, implementing and control of costs projects.

4. Diverse interests are consolidated to the above problems.

5. Creativity is developed through interaction with various specialists.

6. It leads to the development of strong team-work and teams with identity fully with project goals.

Disadvantages of Projects Organization

1. A deliberate conflict is established between the project officer and the existing department heads because of the overlapping of authority delegation.

2. At the close of the project, there is every likelihood of insecurity of employment.

3. There always lurks and danger of over-specialization in the course of project involvement.

4. Rotation from project to project reduces employees’ loyalty to the parent functional
department.