Organizational Influences on Project Management

Projects are typically associated in some way with an enterprise. Examples of enterprises include corporations, government agencies, non-government organizations, healthcare institutions, international bodies, professional associations, and others. When a project involves external entities as part of a joint venture or partnering, the project will be influenced by more than one enterprise. The maturity of the enterprise with respect to its project management system, culture, style, organizational structure and project management maturity can also influence the project. The following sections describe organizational characteristics and structures that are likely to influence the project.

2.4.1 Organizational Cultures and Styles

Cultures and styles may have a strong influence on a project's ability to meet its objectives. Cultures and styles are typically known as "cultural norms." The "norms" include a common knowledge regarding how to approach getting the work done, what means are considered acceptable for getting the work done, and who is influential in facilitating the work being performed.

Most organizations have developed unique cultures that manifest in numerous ways including, but not limited to:

• Shared visions, values, norms, beliefs, and expectations,

• Policies, methods, and procedures,

• View of authority relationships, or

• Work ethic and work hours.

The organizational culture is an enterprise environmental factor as described in Section 1.8. Therefore, a project management professional must understand the different organizational styles and cultures that may affect a project. For example, in some cases the person shown at the top of an organization chart may be a figurehead who is not truly in charge. The project manager must know which individuals in the organization are the decision makers and work with them to influence project success.

The projcct manager and projcci management learn should identify and understand the aspects of the organization's culture and styie thai would most positively or negatively influence the success of the project. Being aware of the opportunities and influences from an organization's culture and style will allow the projcct manager and the projcct management team to manage them,

2.4.2 Organizational Structure

Organizational structure is an enterprise environmental factor that can have an effect on the availability of resources and influence how projects arc conducted. Organizational structures range from functional to projcclizcd, with a variety of matrix structures in between. Figure 2-7 shows key project-reiated characteristics of the major types of organizational structures.

Organization

^"s,Structure Project ^s»^ Character! sticsSl«ss_

Functional

Matrix

Projectlzed

Weak Matrix

Balanced Matrix

Strong Matrix

Project Manager's Authority

Little or None

Limited

Low to Moderate

Moderate to High

High to Almost Total

Resource Availability

Little or None

Limited

Low to Moderate

Moderate to High

High to Almost Total

Who controls the project budget

Functional Manager

Functional Manager

Mixed

Project Manager

Project Manager

Project Manager's Role

Part-time

Part-time

Full-time

Full-time

Full-time

Project Management Administrative Staff

Part-time

Part-time

Part-time

Full-time

Full-time

Figure 2-7. Organizational Influences on Projects

Figure 2-7. Organizational Influences on Projects

The classic functional organization, shown in Figure 2-8, 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 levei. Specialties may be further subdivided into functional organizations, such as mechanical and electrical engineering. Each department in a functional organization will do its projcct work independent of other departments.

Figure 2-8. Functional Organization
Figure 2-9. Projectized Organization

At the opposite end of the spectrum is the projectized organization, shown in Figure 2-9. In a projectized organization, team members are often co-iocated. Most of the organization's resources arc involved in project work, and project managers have a great deal of independence and authority. Projectized organizations often have organizational units called departments, but these groups either report directly to the project manager or provide support services to the various projects.

Project

(Gray boxes represent staff engaged in project activities.) Coordination

Project

(Gray boxes represent staff engaged in project activities.) Coordination

Figure 2-10. Weak Matrix Organization

(Gray boxes represent staff engaged in project activities.)

(Gray boxes represent staff engaged in project activities.)

Project Coordination

Figure 2-11. Balanced Matrix Organization

Matrix organizations, as shown in Figures 2-10 through 2-12, are a blend of functional and projeciized characteristics. Weak matrices maintain many of the characteristics of a functional organization, and the project manager role is more of a coordinator or expediter than that of a manager. Strong matrices have many of the characteristics of the projcctizcd organization, and can 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 docs not provide the project manager with the fui! authority over the project and project funding. Figure 2-6 provides additional details of the various matrix organizational structures.

Figure 2-12. Strong Matrix Organization

Chief Executive

(Gray boxes represent staff engaged in project activities.)

Figure 2-13. Composite Organization

(Gray boxes represent staff engaged in project activities.)

Figure 2-13. Composite Organization

Most modern organizations involve all these structures at various levels, as shown in Figure 2-13 (composite organization). For example, even a fundamentally functional organization may create a special projcct team to handle a critical projcct. Such a team may have many of the characteristics of a projcct 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 operate outside the standard, formalized reporting structure.

2.4.3 Organizational Process Assets

Organizational process assets include any or all processes related to the assets from an organization(s) involved in a project that can be used to influence the project's success. These process assets includc formal and informal plans, policies, procedures, and guidelines. The process assets also includc the organizations' knowledge bases such as lessons learned and historical information. Organizational process assets also represent the organization's learning and knowledge from previous projects and may include completed schedules, risk data, and earned vaiuc data. Organizational process assets may take many different forms depending on the type of industry, organization, and application area. Updating and adding to the organizational process assets is generally the responsibility of the project team members as necessary throughout the project. Organizational process assets may be grouped into two categories:

.1 Processes and Procedures

The organization's processes and procedures for conducting work include but arc not limited to:

• Organizational standard processes such as standards, policies (e.g., safety and health policy, ethics policy, and projcct management policy), standard product and projcct life cycles, and quality policies and procedures (e.g., process audits, improvement targets, checklists, and standardized process definitions for use in the organization),

• Standardized guidelines, work instructions, proposal evaluation criteria, and performance measurement criteria,

• Templates (e.g., risk templates, work breakdown structure templates, and project schedule network diagram templates),

• Guidelines and criteria for tailoring the organization's set of standard processes to satisfy the specific needs of the project,

• Organization communication requirements (e.g., specific communication technology available, allowed communication media, record retention policies, and security requirements),

• Project closure guidelines or requirements (e.g., final project audits, project evaluations, product validations, and acceptance criteria),

• Financial controls procedures (e.g., time reporting, required expenditure and disbursement reviews, accounting codes, and standard contract provisions),

• Issue and defect management procedures defining issue and defect controls, issue and defect identification and resolution, and action item tracking

• Change control procedures, including the steps by which official company standards, policies, plans, and procedures—or any project documents—will be modified, and how any changes will be approved and validated,

• Risk control procedures, including risk categories, probability definition and impact, and probability and impact matrix, or

• Procedures for prioritizing, approving, and issuing work authorizations. .2 Corporate Knowledge Base

The organizational corporate knowledge base for storing and retrieving information includes but is not limited to:

• Process measurement databases used to collect and make available measurement data on processes and products,

• Project files (e.g., scope, cost, schedule, and quality baselines, performance measurement baselines, project calendars, project schedule network diagrams, risk registers, planned response actions, and defined risk impact),

• Historical information and lessons learned knowledge bases (e.g., project records and documents, all project closure information and documentation, information about both the results of previous project selection decisions and previous project performance information, and information from the risk management effort),

• Issue and defect management databases containing issue and defect status, control information, issue and defect resolution, and action item results,

• Configuration management knowledge bases containing the versions and baselines of all official company standards, policies, procedures, and any project documents, and

• Financial databases containing information such as labor hours, incurred costs, budgets, and any project cost overruns.

Project Management Made Easy

Project Management Made Easy

What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.

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