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- finance Manufacturing | s,Engineering

Figure 4-5: Staff organization.

principles of design, and no step-by-step procedures that give detailed instructions for determining what kind of structure is needed and how it can be built. All we can do is consider the nature of the potential project, the characteristics of the various organizational options, the advantages and disadvantages of each, the cultural preferences of the parent organization, and make the best compromise we can.

In general, the functional form is apt to be the organizational form of choice for projects where the major focus must be on the in-depth application of a technology rather than, for example, on minimizing cost, meeting a specific schedule, or achieving speedy response to change. Also, the functional form is preferred for projects that will require large capital investments in equipment or buildings of a type normally used by the function.

If the firm engages in a large number of similar projects (e.g., construction projects), the pure project form of organization is preferred. The same form would generally be used for one-time, highly specific, unique tasks that require careful control and are not appropriate for a single functional area—the development of a new product line, for instance.

When the project requires the integration of inputs from several functional areas and involves reasonably sophisticated technology, but does not require all the technical specialists to work for the project on a full-time basis, the matrix organization is the only satisfactory solution. This is particularly true when several such projects must share technical experts. But matrix organizations are complex and present a difficult challenge for the PM.

In choosing the structure for a project, the first problem is to determine the kind of work that must be accomplished. To do this requires an initial, tentative project plan. First, identify the primary deliverable(s) of the project. Next, list the major tasks associated with each deliverable. For each task, determine the functional unit that will probably be responsible for carrying out the task. These are the elements that must be involved in order to carry out the project. The problem is how best to bring them together—or, how best to integrate their work. Additional matters to be considered are the individuals (or small groups) who will do the work, their personalities, the technology to be employed, the client(s) to be served, the political relationships of the functional units involved, and the culture of the parent organization. Environmental factors inside and outside the parent organization must also be taken into account. By understanding the various structures, their advantages and disadvantages, a firm can select the organizational structure that seems to offer the most effective and efficient choice. Another view of the problem of selecting the appropriate interface between the project and its parent organization is found in |28).

Since it is our objective in this chapter to provide criteria for the selection of a project organization, we shall illustrate the process with two examples. In each case, we use the following procedure.

1. Define the project with a statement of the objective(s) that identifies the major outcomes desired.

2. Determine the key tasks associated with each objective and locate the units in the parent organization that serve as functional "homes" for these types of tasks.

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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