CHAPTER 2

ORGANIZATIONAL STRUCTURES AND PROJECT LIFE CYCLE IN PROJECT

MANAGEMENT

AMILIA NOORLIN BINTI MD JELANI

JAB. KEJ. AWAM
POLITEKNIK PORT DICKSON
CONTENTS

Influences Of Organizational Structures In

Project Management

Project Life Cycle In

Project Management

Resources In The
Project Management
INFLUENCES OF ORGANIZATIONAL
STRUCTURES IN PROJECT
MANAGEMENT
An organization’s culture, style, and structure
influence how its projects are performed.

The organization’s level of project management

maturity and its project management systems
can also influence the project.

When a project involves external entities such as

those that are part of a joint venture or
partnering agreement, the project will be
influenced by more than one organization.

The following sections describe organizational

characteristics, factors, and assets within an
enterprise that are likely to influence the project.
 TYPE OF ORGANIZATIONAL STRUCTURES IN
PROJECT MANAGEMENT
The simplest form of The quality of work is Possesses practically
organization in which better, wastage of all the advantages of
responsibility of each material is minimum both the line and

FUCTIONAL ORGANIZATION

LINE AND STAF ORGANIZATION

individual is fixed, and specialized functional
discipline is strong and knowledge and organizations.
LINE ORGANIZATION

quicker decisions are guidance to individual The quality of work is

taken. worker is provided. improved and there is
The disadvantages Suitable for large sized less wastage of
It overloads a few key construction works. material, man and
executive and machine hours.
encourages dictatorial The expert advice from
way of working. specialist staff
Suitable for small executives can be
construction works. made use of.
Preferred for medium
sized construction
works.
 INFLUENCES ORGANIZATIONAL STRUCTURES IN
PROJECT MANAGEMENT

Organizational structure is an enterprise

environmental factor, which can affect the availability
of resources and influence how projects are conducted.

https://www.slideshare.net/ashwinprince/project-management-structures
The classic functional organization, shown in Figure 2-1, is a
hierarchy where each employee has one clear superior.

Staff members are grouped by specialty, such as production,

marketing, engineering, and accounting at the top level.

Specialties may be further subdivided into focused functional

units, such as mechanical and electrical engineering.

Each department in a functional organization will do its project

work independently of other departments.
Matrix organizations, as shown in Figures 2-2 through 2-4, reflect a blend
of functional and projectized characteristics.

Matrix organizations can be classified as weak, balanced, or strong

depending on the relative level of power and influence between
functional and project managers.

Weak matrix organizations maintain many of the characteristics of a

functional organization, and the role of the project manager is more of a
coordinator or expediter.

A project expediter works as staff assistant and communications

coordinator. The expediter cannot personally make or enforce decisions.

Project coordinators have power to make some decisions, have some

authority, and report to a higher-level manager.

Strong matrix organizations have many of the characteristics of the

projectized organization, and have full-time project managers with
considerable authority and full-time project administrative staff.

While the balanced matrix organization recognizes the need for a project
manager, it does not provide the project manager with the full authority
over the project and project funding. Table 2-1 provides additional details
of the various matrix organizational structures.
At the opposite end of the spectrum to the functional
organization is the projectized organization, shown in Figure 2-
5.

In a projectized organization, team members are often

collocated.

Most of the organization’s resources are involved in project

work, and project managers have a great deal of independence
and authority.

Virtual collaboration techniques are often used to accomplish

the benefits of collocated teams.

Projectized organizations often have organizational units

called departments, but they can either report directly to the
project manager or provide support services to the various
projects.
Many organizations involve all these structures at various
levels, often referred to as a composite organization, as
shown in Figure 2-6.

For example, even a fundamentally functional organization

may create a special project team to handle a critical project.

Such a team may have many of the characteristics of a project

team in a projectized organization.

The team may include full-time staff from different functional

departments, may develop its own set of operating
procedures, and may even operate outside of the standard,
formalized reporting structure during the project.

Also, an organization may manage most of its projects in a

strong matrix, but allow small projects to be managed by
functional departments.
 PROJECT LIFE CYCLE IN
PROJECT MANAGEMENT
VIDEO of Project Life Cycle
 PROJECT LIFE CYCLE
• A project life cycle is the series of phases that a project passes through from its initiation to its closure.
• The phases are generally sequential, and their names and numbers are determined by the management and control needs
of the organization or organizations involved in the project, the nature of the project itself, and its area of application.
• The phases can be broken down by functional or partial objectives, intermediate results or deliverables, specific milestones
within the overall scope of work, or financial availability.
• Phases are generally time bounded, with a start and ending or control point. A life cycle can be documented within a
methodology.
• The project life cycle can be determined or shaped by the unique aspects of the organization, industry, or technology
employed.
• While every project has a definite start and a definite end, the specific deliverables and activities that take place in
between will vary widely with the project.
• The life cycle provides the basic framework for managing the project, regardless of the specific work involved.
• Project life cycles can range along a continuum from predictive or plan-driven approaches at one end to adaptive or
change-driven approaches at the other.
• In a predictive life cycle, the product and deliverables are defined at the beginning of the project and any changes to scope
are carefully managed.
• In an adaptive life cycle the product is developed over multiple iterations and detailed scope is defined for each iteration
only as the iteration begins.
 Characteristics of the Project Life cycle
Projects vary in size and complexity. All projects can be
mapped to the following generic life cycle structure (see
Figure 2-7):
•Starting the project

•Organizing and preparing,

•Carrying out the project work, and
•Closing the project.
• This generic life cycle structure is often referred to when
communicating with upper management or other entities
less familiar with the details of the project.
• It should not be confused with the Project Management,
because the processes consist of activities that may be
performed and recur within each phase of a project as
well as for the project as a whole.
• The project life cycle is independent from the life cycle of
the product produced by or modified by the project.
• However, the project should take the current life-cycle Figure 2-7. Typical cost and Staffing Levels Across a Generic
phase of the product into consideration. This high-level Project Life cycle Structure
view can provide a common frame of reference for
comparing projects—even if they are dissimilar in nature.
 • The generic life cycle structure generally displays the following
characteristics:
•Cost and staffing levels are low at the start, peak as the work is
carried out, and drop rapidly as the project draws to a close. Figure 2-8
illustrates this typical pattern.
•The typical cost and staffing curve above may not apply to all
projects. A project may require significant expenditures to secure
needed resources early in its life cycle, for instance, or be fully staffed
from a point very early in its life cycle.
•Risk and uncertainty (as illustrated in Figure 2-8) are greatest at the
start of the project. These factors decrease over the life of the
project as decisions are reached and as deliverables are accepted
•The ability to influence the final characteristics of the project’s
product, without significantly impacting cost, is highest at the start
of the project and decreases as the project progresses towards
completion.
• Figure 2-8 illustrates the idea that the cost of making changes and
correcting errors typically increases substantially as the project
Figure 2-8. Impact of Variable Based on Project Time approaches completion.
• While these characteristics remain present to some extent in almost
all project life cycles, they are not always present to the same degree.
• Adaptive life cycles, in particular, are developed with the intent of
keeping stakeholder influences higher and the costs of changes lower
throughout the life cycle than in predictive life cycles.
Phases of Project life cycle
• A project may be divided into any number of phases.
• A project phase is a collection of logically related project activities that
culminates in the completion of one or more deliverables.
• Project phases are used when the nature of the work to be performed is unique
to a portion of the project, and are typically linked to the development of a
specific major deliverable.
• A phase may emphasize processes from a particular Project Management, but it
is likely that most or all processes will be executed in some form in each phase.
• Project phases typically are completed sequentially, but can overlap in some
project situations.
• Different phases typically have a different duration or effort.
• The high-level nature of project phases makes them an element of the project
life cycle
Project life cycle diagram
 A. Initiating Processes

• The first phase, includes the preliminary evaluation of an idea.

• Most important in this phase is a preliminary analysis of risk
and the resulting impact on the time, cost, and performance
requirements, together with the potential impact on company
resources
• Project feasibility
• An evaluation and analysis of the potential of the proposed project which is based
on extensive investigation and research to support the process of decision making
• Aim to objectively and rationally uncover the strengths and weaknesses of an
existing business or proposed venture, opportunities and threats present in the
environment, the resources required to carry through, and ultimately the prospects
for success.
• A well-designed feasibility study should provide a historical background of the
business or project, description of the product or service, accounting statements,
details of the operations and management, marketing research and policies,
financial data, legal requirements and tax obligations
• Generally, feasibility studies precede technical development and project
implementation.
• Project Contract
• Document that formally authorizes a project
• Issued by senior management
• Briefly describes project scope
• Designates the project and project manager
• Authorizes project manager to apply resources to project
activities
B. Planning Processes

• It is mainly a improvement of the elements described under the

conceptual phase.
• The planning phase requires a firm identification of the resources to
be required together with the establishment of realistic time, cost,
and performance parameters
• This phase also includes the initial preparation of all documentation
necessary to support the system
• For a project based on competitive bidding, the conceptual phase
would include the decision of whether to bid, and the planning phase
would include the development of the total bid package (i.e., time,
schedule, cost, and performance).
i) Project scope statement
• Purpose of the project
• Project objectives
• Project deliverables
• Project cost and schedule estimates
• Project stakeholders

ii. Work Breakdown Structure

• A structured method for defining the work of the project
Work Breakdown Structure (WBS)
Purpose:
• To define all of the “deliverables” required to meeting the
scope of the project
• To identify additional deliverables that may have been missed
• To create the framework for the project schedule
• To provide a forum for information sharing for the project
team and stakeholders
iii. Project schedule
What is it?
Developing a plan that describes the order and timing of all work activities
and who is responsible for doing them.

Purpose:
• To determine WHEN work will be performed
• To identify WHO will do the work
• To analyze activity dependencies and sequences
• To evaluate resource requirements, availability and utilization
• To Identify Milestones
iv. The budget development
What is it?
Budget development is the process by which an estimate for
the total monetary cost of a project is produced

Purpose:
• To identify costs required to produce the project deliverables
• To produce an accurate estimate of project costs
• To obtain approval for project funding
• To provide a basis for monitoring and controlling spending
v. Risk Planning
What is it?
Identifying threats and opportunities that can affect the project
and planning to deal with them PROACTIVELY.

Purpose:
• To identify potential threats and opportunities
• To qualify risks based upon probability and impact to the project
• To create a plan for mitigating or responding to the risk
• To quantify the impact to the project schedule and/or budget
vi. Procurement Planning
Involves the consideration of :
• Whether to procure (outsource decision)
• How to procure (procurement method and contract type)
• What to procure (products and services needed)
• How much to procure (quantity desired)
• When to procure (delivery schedule)
C. Executing Processes
• The project plan is put into motion and performs the work of
the project
• It is important to maintain control and communicate as
needed during execution
• Progress is continuously monitored and appropriate
adjustments are made and recorded as variances from the
original plan
• In any project a project manager will spend most of their time in this step.
• During project execution, people are carrying out the tasks and progress
information is being reported through regular team meetings
• The project manager uses this information to maintain control over the
direction of the project by measuring the performance of the project
activities comparing the results with the project plan and takes corrective
action as needed
• The rst course of action should always be to bring the project back on
course, i.e., to return it to the original plan.
• If that cannot happen, the team should record variations from the original
plan and record and publish modications to the plan.
• Status reports should always emphasize the anticipated end point in
terms of cost, schedule and quality of deliverables.
• Throughout this step, project sponsors and other key stakeholders
should be kept informed of project status according to the agreed
upon frequency and format.
• The plan should be updated and published on a regular basis
• Each project deliverable produced should be reviewed for quality
and measured against the acceptance criteria.
• Once all of the deliverables have been produced and the customer
has accepted the final solution, the project is ready for closure
D. Closing Processes
• Close Project or Phase is the process of finalizing all activities across all of the
Project Management to formally complete the project or phase.
• The key benefit of this process is that it provides lessons learned, the formal ending
of project work, and the release of organization resources to pursue new endeavors.
• The closure phase evaluates the efforts on the total system and serves as input to
the conceptual phases for new projects and systems.
• This final phase also has an impact on other ongoing projects with regard to
priority identification.
• The closure of a phase ends with some form of transfer or hand-off of the work
product produced as the phase deliverable.
• This phase end represents a natural point to reassess the activities underway and to
change or terminate the project if necessary.
• This point may be referred to as a stage gate, milestone, phase review, phase gate
or kill point. In many cases, the closure of a phase is required to be approved in
some form before it can be considered closed
Resources in the Project Management

Manpower/workers/Labours

Plant and equipment

Material

Overheads & Profit

 Manpower Management
• Includes the processes that organize, manage, and lead the project team.
• The project team is comprised of the people with assigned roles and
responsibilities for completing the project.
• Project team members may have varied skill sets, may be assigned full or
part-time, and may be added or removed from the team as the project
progresses.
• Project team members may also be referred to as the project’s staff.
• Although specific roles and responsibilities for the project team members
are assigned, the involvement of all team members in project planning
and decision making is beneficial.
• Participation of team members during planning adds their expertise to
the process and strengthens their commitment to the project.
 Overview Of The Project Human Resource
Management Processes
Plan Human resource Management:-
The process of identifying and documenting project roles, responsibilities,
required skills, reporting relationships, and creating a staffing management plan.
Acquire Project team:-
The process of confirming human resource availability and obtaining the team
necessary to complete project activities.
Develop Project team:-
The process of improving competencies, team member interaction, and overall
team environment to enhance project performance.
Manage Project team:-
The process of tracking team member performance, providing feedback,
resolving issues, and managing changes to optimize project performance.
Project Human resource Management Overview
Roles And Responsibilities.
• The following should be addressed when listing the roles and responsibilities needed to complete a project:
Role.
The function assumed by or assigned to a person in the project. Examples of project roles are civil engineer,
business analyst, and testing coordinator. Role clarity concerning authority, responsibilities, and boundaries
should also be documented.
Authority.
The right to apply project resources, make decisions, sign approvals, accept deliverables, and influence others
to carry out the work of the project. Examples of decisions that need clear authority include the selection of a
method for completing an activity, quality acceptance, and how to respond to project variances.
Team members operate best when their individual levels of authority match their individual responsibilities. ○
Responsibility. The assigned duties and work that a project team member is expected to perform in order to
complete the project’s activities.
Competency.
The skill and capacity required to complete assigned activities within the project constraints. If project team
members do not possess required competencies, performance can be jeopardized. When such mismatches
are identified, proactive responses such as training, hiring, schedule changes, or scope changes are initiated.
Project organization charts.
• A project organization chart is a graphic display of project
team members and their reporting relationships.
• It can be formal or informal, highly detailed or broadly framed,
based on the needs of the project.
• For example, the project organization chart for a 3,000-person
disaster response team will have greater detail than a project
organization chart for an internal, twenty-person project.
Construction project management organization for a large
project
Staffing Management Plan.

The staffing management plan is a component of the human resource management plan
that describes when and how project team members will be acquired and how long they will
be needed. It describes how human resource requirements will be met.
The staffing management plan can be formal or informal, highly detailed, or broadly
framed, depending upon the needs of the project.
The plan is updated continually during the project to direct ongoing team member
acquisition and development actions. Information in the staffing management plan varies
by application area and project size, but items to consider include:
• Staff acquisition.
• Resource calendars.
• Staff release plan.
• Training needs
• Recognition and rewards.
• Compliance.
• Safety.
Problem Related to Labour are:

i. Unskilled and shortage labour :-

Poor workmanship, lack of experience & training

ii. Poor and shortage supervision:-

Lack of supervisor, lack of experience

iii. Slow mobilization:-

Low motivation, poor access
Plant and Machineries Management

• One of the most important resources to be managed is plant and equipment.

• The cost may varies from the range of 20-40% of total construction cost.
• Appropriate planning and acquiring of machineries can help to reduce or avoid the
problems face during construction stages
• Planning and scheduling of machineries / equipment must be indicated
on the work programmed. Requisition on acquiring must be made once
the decision has been made to use a particular machinery
• Analysis of leveling on the usage of machineries/equipment can guide
the managers to make critical decision.
• Undoubtedly, critical activities will be given the most priority.
• If during a particular day, 2 or more activities require the use of same
equipment, hence priority must be given to the critical activity.
• Despite careful planning and acquisition, problems may still occur during
construction stage.
The problem that faced by the contractor during the
construction progress are:

• Breakdown – no maintenance, over usage

• Shortage – unplanned, several activities
• Inefficient – unskilled operations, under capacity
• Stolen – no security, no hoarding
• Unavailability – unaware of market availability, no requisition
Acquisition of Machineries/ Equipment's
• The decision to acquire construction machineries/equipment has to be considered
seriously cause the capital required is very high.
• The cost of some machineries can be in the range of several hundred thousand to
million ringgit.
• If decided to purchase and own a particular machine, one has to take into account
services such as maintenance, rental, cost account, etc.
Acquiring construction machineries can be considered through several option as
shown in figure below.
Classification of construction plant

• Excavating plant
• Compacting plant
• Concreting plant
• Bitumen laying plant
• Transporting plant
• Lifting plant
• Piling plant and equipment
• Drilling plant and equipment
Material Resources Management
• The cost of construction materials can be in the range of between 20-40% of total
construction cost.
• Appropriate control is required to ensure the actual cost is in between budget.
• Material resources are supplies and stocks that are needed to complete a project.
• Quality of materials are a set of specified standard that usually stipulated in the contract
documents
• Wastage on construction site can be in between the range of 3-8% of total materials
usage.
• It is important to control wastage at site to increase profitability and reduce the impact
on environment.
• Materials affect dates or duration only when you have to wait
for those materials to become available.

• Several causes that lead to waste at construction site are:

• Weather – flooding, long exposure, decay
• Lost / stolen
• Requisition – wrong order, extra quantity of order
• Cutting & handling – no planning in cutting, improper handling
• Quality materials
Overheads
• Management cost company is expense rate bear by the company to manage
and administer staff and office equipment.
• Matter subject include :
• Pay, allowance and other payment to all employees of the company.
• Office rental, storehouse store, workshop and others.
• Electric payment, phone, post, insurance, telegraph and others.
• Office equipment as furniture, typewriter, computer, photocopier, paper,
stationery and others.
• Payment to operate workshop and for equipment no motorized.
Profit
• To ensure contractor business can run perfectly, then company need
some allocation to accommodate cost management and
administration liability something contract.

• Profit rate count by percent from all material cost, labour and plant.
Profit calculated is gross profit ( gross profit ). Gross profit comprise
from:
• Net profit ( nett cost )
• Overhead Cost ( overhead )
Thank You