3/17/2020
Project Management
BA023IU
Recap of Session 4
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Conflict resolution
Negotiation
Case: “Habitat for Humanity Wins a Big One”
Agenda
Session 5
Project Organization
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Why project organization matters?
Three major project organization forms
Selecting appropriate organization form
Project management office and project team
Lecturer: Tung Nhu Nguyen
1. The importance of project
organization
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Remember in Session 1, what made project
emerged as an important alternative:
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Skills and knowledge specification, knowledge
explosion
Demands for more complex and customized
goods and services, increased customer focus,
compressed product life cycle
Evolution of larger and more sophisticated
markets, global competition
Project-oriented organization
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Has the advantages in terms of
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Response to market
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The traditional way
The project way
Diverse specialized knowledge required
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Manufactured goods vs. agricultural goods
Software: graphics vs. logical design vs. programming
Films
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Project-oriented organization
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Responsive to organizational changes
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2. Different ways in organizing
projects
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Those happen more and more frequently: companies
buying other companies, or product lines
When new management trends emerged: applying
corporate reengineering, CRM…
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Communicating with single project managers rather than to
multiple functional managers on complicated matters
2.1 Project as part of a
functional department
Level of independence
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Deciding on project design is usually the
responsibility of senior management, PMs
can give comments or be involved
2.1 Project as part of a
functional department
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Advantages
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President
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Marketing
Market research project Z
Launching Brand X
Finance
HR
2.1 Project as part of a
functional department
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Pure project
Matrix
Functional
Enable total-control, one-stop contact point of
organizational issues.
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As a part of functional department
Pure project organization
Matrix organization
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Flexibility of staff, of resources
Better use of resources for multiple projects inside
the department
Exchange of ideas, knowledge, assistance among
experts inside the department
Retain knowledge and know-how inside
department and organization; continuity
Incubator for potential experts
2.2 Pure project organization
Disadvantages
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Project may not received focus needed inside
functional dept., when other daily activities are
going on, slow response to project issues
Discipline oriented rather than problem oriented
No dedicated PM may result in chaos
More priorities are given to tasks related to the
department
Lack of motivation, as project staff are not “seen”
Lack of holistic view to address problems or better
serve the clients
President
Program manager
Vice President marketing
Project 2
Project 1
Vice President HR
Project …
Marketing
Marketing
Design
Design
Finance
Finance
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2.2 Pure project organization
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Organization consists of many projects and
no official functional department
Each project has “everything”: manager, staff
of different specialization, resources, office
For instance
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Resources and efforts, not shared but duplicated
and wasted
Excess resources tend to be stored idle in
individual projects to be ready “when necessary”
Project technical staff might become outdated
with technical advancement, lack of a breadth of
knowledge as they are away from functional dept.
Technical procedure not strictly followed
Mental issues: rivalries among projects, anxiety
for life after projects finished
2.3 Matrix organization
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Advantages
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The PM has total authority, single boss
The staff are also responsible to one boss only
Communications are streamlined, decision
making is quicker, better responses to changes or
Project identity is promoted
Better commitment and motivation
Structure is easily understood, better working
atmosphere in general
Problems are solved with a holistic approach
2.3 Matrix organization
Disadvantages
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An IT outsourcing company organizes project as
nucleus of operation
A research lab that has various projects on some
breakthrough products
2.2 Pure project organization
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2.2 Pure project organization
Matrix = Pure + Functional
Different levels of matrix exist
The roles of PMs: when and what tasks to be
finished
The roles of functional managers: who to
send and how tasks to be finished
For instance:
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The project to design, produce and introduce a
new homepage of the university
President
Manufacturing
Marketing
HR
Finance
Project 1 - Mfg
Project 1 – Mar.
Project 1 – HR
Project 1 – Fin
Project 2 - Mfg
Project 2 – Mar.
Project 2 – HR
Project 2 – Fin
Project 3 - Mfg
Project 3 – Mar.
Project 3 – HR
Project 3 – Fin
2.3 Matrix organization
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Advantages
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Better identity, better focus, better commitment
Flexibility prevails, resources shared, waste and
duplication reduced
Less anxiety when projects end as staff still
belong to functional departments
Administrative and technical procedures tend to
be followed more strictly
Loads tend to be more balanced or optimized
among projects, problems holistically addressed
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2.3 Matrix organization
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Variations of matrix org.
Disadvantages
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Conflict between project manager and functional
manager: who is in charge? (WHO?) PMs tend to
have strong negotiating skills to succeed
In times of success, who is the creditor? in times
of difficulties, who is the culprit?
Conflicts among project managers as they
compete to secure resources for one’s own
project
Staff have to work under two bosses
Weak matrix (functional matrix)
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Variations of matrix org.
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Balanced matrix
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Variations of matrix org.
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When a functional group is to serve several
similar projects
A person is assigned to oversee the project and
interact on an equal basis with functional
managers. This person and the functional
managers jointly direct workflow segments and
approve technical and operational decisions.
Organization structure influences
on projects
A person is formally designated to oversee the
project across different functional areas. This
person has limited authority over functional
people involved and serve primarily to plan and
coordinate the project.
The functional managers retain primary
responsibility for their specific segments of the
project.
Share capacity rather than dedicated expert
Strong matrix (project matrix)
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A person is assigned to oversee the project and is
responsible for the completion of the project. The
functional managers involvement is limited to
assigning personnel as needed and providing
advisory expertise.
3. Selecting an appropriate
project organization form
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Situation determined
Each form has pros and cons
No one form is best for all projects, or even
best for one project throughout its entire life
cycle.
Source: PMI
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3. Selecting an appropriate
project organization form
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What to consider:
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The nature of the project
 Importance
 Size, budget, time constraints
 Innovation involved
Options from organizational point of view
 Resources available, stability of supplies, potential
problems…
Attitudes of management
 Experience
 Freedom given to PM
Then, decide
3. Selecting an appropriate
project organization form
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Examples:
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A construction company won a tender and to build
a theatre
A supermarket to use new shelves and change
the arrangement of the floor
A bank to implement a customer relationship
management system
3. Selecting an appropriate
project organization form
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Common sense:
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4.1 Project Management Office
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Role:
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4.1 Project Management Office
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Tasks
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Which form is appropriate?
Establish processes
Develop management system
Help with administrative details
Conducting review, audit
Report progress
Serve as a place for PMs to exchange
Facilitator for project management tasks
Not project implementation
Responsibilities
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Functional project: Technology driven, building,
equipment, large capital investment
Pure project: Many similar projects (construction),
control required, specific, unique (to market a new
product)
Matrix: when??
Improve efficiency of project implementation
Promote good practices
Data and information streamlines
Communication with stakeholders about progress
4.2 Project Team
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The PM and his key members
Typical key members of a project may
include:
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Project engineer
Manufacturing engineer
Field manager
Contract administrator
Project controller
Support service manager
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Quiz
4.2 Project Team
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Issues in managing project team
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Perfectionism
Motivating the team
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Participatory approach
Empowerment
Delegation
Conflict resolution
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