Training Sub-units

8. Organizational Context of Projects

8.1. Organizational and Project Governance

8.2. Enterprise Environmental Factors

8.3. Organizational Structures

8.4. Organizational Process Assets

8.5. Project Management Office (PMO)

8.6. Project-Based Organizations (PBO)

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 Organizational Structures at a Glance

 There is a spectrum / continuum of organizational structures.

 The two extremes include the „functional‟ and „projectized‟ organizations.

Balanced
Matrix

Weak Strong
Matrix Matrix

Functional Projectized

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 Example 2: A Project-based Company
Managing
Director

Architectural Structural Mechanical Electrical

Design Design Design Design
Manager Manager Manager Manager

Architectural Structural Mechanical Electrical

Designer Designer Designer Designer

Architectural Structural Mechanical Electrical

Designer Designer Designer Designer

Architectural Structural Mechanical Electrical

Designer Designer Designer Designer

 Each specialty or expertise (e.g. electrical design) is called a „function‟.

 Each function has a separate department and a „functional manager‟.
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 Example 2: A Project-based Company

 Sample project (external): designing a residential building

 Requesting entity: Client
 Performing entity: Company (engineering consultant)

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 Functional Organization
Managing
Director

Architectural Structural Mechanical Electrical

Project
Design Design Design Design Coordination
Manager Manager Manager Manager

Architectural Structural Mechanical Electrical

Designer Designer Designer Designer

Architectural Structural Mechanical Electrical

Designer Designer Designer Designer

Architectural Structural Mechanical Electrical

Designer Designer Designer Designer

 Functional managers together make project decisions.

 All communications are through functional managers.
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 Weak-Matrix Organization
Managing
Director

Architectural Structural Mechanical Electrical

Design Design Design Design
Manager Manager Manager Manager

Architectural Structural Mechanical Electrical

Designer Designer Designer Designer

Architectural Structural Mechanical Electrical

Designer Designer Designer Designer

Architectural Structural Mechanical Electrical

Designer Designer Designer Designer

 Most project decisions / communications are delegated to the team.

 A project team member acts as the project „coordinator‟ (or „expeditor‟).
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 Balanced-Matrix Organization
Managing
Director

Architectural Structural Mechanical Electrical

Design Design Design Design
Manager Manager Manager Manager

Architectural Structural Mechanical Electrical

Designer Designer Designer Designer

Architectural Structural Mechanical Electrical

Designer Designer Designer Designer

Project Structural Mechanical Electrical

Manager Designer Designer Designer

 A project team member is assigned as the „project manager‟.

 Project management is not fully recognized as a profession yet.
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 Strong Matrix Organization
Managing
Director

Architectural Structural Mechanical Electrical Manager of

Design Design Design Design Project
Manager Manager Manager Manager Managers

Architectural Structural Mechanical Electrical Project

Designer Designer Designer Designer Manager

Architectural Structural Mechanical Electrical Project

Designer Designer Designer Designer Manager

Architectural Structural Mechanical Electrical Project

Designer Designer Designer Designer Manager

 There is a separate organizational unit for project managers.

 Project management is a professional, full-time job.
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 PM as a „Profession‟ - Sample Aspects

Structural Engineering Project Management

Functional Manager of Structural Engineering Manager of Project Management

Manager Department Department

Professional books, magazines, Professional books, magazines,

Professional Library
journals, catalogues, … in SE journals, catalogues,… in PM

- ACI - PMBOK® Guide

Codes & Standards
- ASTM - ISO 21500

Procedures & - Equipment Foundation Design - Cost Control

Work Instructions - Piling Design - Project Closure

Professional - SAFE - Primavera Project Planner (P3)

Software - X Steel - PERT Master
Professional
American Concrete Institute (ACI) Project Management Institute (PMI)
Institutes

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Roles of Functional Managers in Matrix Structures

HR Management
- Recruitment
- Training
- Assignment to projects Infrastructure Management
- Performance appraisal - Professional software
- Professional hardware
- Office space & facilities
Quality Management Functional
- Codes & standards
- Uniform procedures
Manager
- QC of critical items
- QA (through auditing)
Support to Projects
Knowledge Management - Proposal development
- Project setup (e.g. KOM)
- Professional library
- Technical support to team
- Research & development
- Seminars and forums
- Lessons learned
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 Projectized Organization
Managing
Director

Manager of
Project
Managers

Project Project Project

Manager Manager Manager

Architectural Architectural Architectural

Designer Designer Designer

Structural Structural Structural

Designer Designer Designer

Mechanical Mechanical Mechanical

Designer Designer Designer

Electrical Electrical Electrical

Designer Designer Designer

 Each project has its own team, completely focusing on that project.
 Project team members are usually co-located.
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 „Strong Matrix‟ vs. „Projectized‟
Some Advantages of
‘Strong Matrix’ Organization
More professional team acquisition
Less concern for team‟s training
Technical support of functional managers
Uniform procedures, instructions, etc.
Sharing scarce resources among projects
More effective QA / QC
Readily available infrastructure
More professional project plans
Better accumulation of knowledge
More knowledge-based
Some Advantages of
‘Projectized’ Organization
Agile in decision making
More flexible to project changes
Unity of command
Maximum authority for the project manager
Full concentration on a single project
Faster and more effective communications
Co-location of team members
Easier team building and development
Higher team cohesiveness
More project-based
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 Composite (Blended) Organizations

 Sample 1 (operational):
 Typical, routine projects: balanced matrix
 Large, complex and important projects: strong matrix or projectized
 Simple, small projects: weak matrix or functional

 Sample 2 (project-based):
 Organizing engineering and procurement as strong matrix.
 Organizing construction & erection as projectized.

 Sample 3 (project-based):
 For project-based companies, the optimal organizational structure may be a
composite of „strong matrix‟ and „projectized‟ organizations.
 See the next page.

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 Composite (Blended) Organizations

 For engineering and procurement (office works):

Project Start Project Peak Project End
Tight Matrix
Strong Matrix Co-locating key team members (one Strong Matrix
representative from each functional
department) with the project manager

 For construction, erection and commissioning (site works):

Approving eligibility of Perform scheduled / random
recruitment candidates audits to ensure compliance

Headquarters
Managing professional Providing infrastructure
education & training
Functional (hardware & software)
Departments
Developing uniform Establishing COP
procedures, instructions, … (community of practice)

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