Organization Structures training

1. Next Organization Structures training A description of the different types of organization structures and how they impact the role of a PM and RM. © 2009 IT Project & Portfolio Office I The University of Utah

2. Functional Organization Organization Structures • Projectized Organization • Matrix Organization The way an organization or department is structured often constrains the availability of resources and determines what level of authority a project manager has on a project. Variations and combinations abound among these three structures. This presentation reviews the three basic organizational structures and how each structure effects the role of a Functional Manager and Project Manager. Click on the menu selection to the right to begin.

3. Menu Previous Next Functional Organization

4. Menu Previous Next Functional Organization A hierarchy where each employee has one clear superior is called a Functional Organization. Staff members are grouped by function, specialty, or expertise. The project scope of these organizations are usually limited to the boundaries of the function it is organized by. Each function is managed independently and has a limited span of control. As an example, the organization might have IT, HR, Finance and Marketing departments, and so on. IT does not run Marketing’s projects and is concerned with its own projects. If it were necessary to get input from Marketing on a project, IT members would follow the chain of command. An IT manager would speak with a Marketing manager and get the needed information and pass it down to the project team.

5. Menu Previous Next Functional Organization In a Functional Organization a Project Manager has little to no authority over resources availability and acts more as a project coordinator. Projects in a Functional Organization are undertaken by two approaches: Divided: Where a department will work on their portion of the project and hand it off to the next department to complete its part, and so on. Cross Functional: Where members of different departments work together at the same time on various aspects of the project. Project Team Members will more than likely remain loyal to their Functional Managers. The dotted lines on the graphic represent where the Project Manager coordinates projects and the gray boxes represent staff engaged in project activities.

6. Menu Previous Next Functional Organization Project Manager’s Authority 1 Resource Availability 2 Control of Budget 3 The Project Manager has little or no authority in a functional organization due to the following: Staff members report directly to Functional Managers A strict chain of command exists Corporate culture dictates that you follow the functional hierarchy The availability of resources is determined by the Functional Manager allowing little to no influence from Project Managers. Competition for resources is fierce. Functional Managers control the budget to a project. The Functional Manager is responsible for resources performance reviews, and their career opportunities lie within the functional department- not within the project team.

7. Menu Previous Next Function Junction You have been assigned as project manager in implementing a new cash register system for the University Bookstore. As part of the team you will require programmers, financial analysts, testers and business analysts from the IT and Finance departments. Both functional managers have approved your requested resources for the project. Directly after your kickoff meeting the functional manager from Finance notifies you that her resource is being pulled from your project in order to work on the new tax law project that Dan is heading up. You are frustrated and contend that an agreement has already been reached between the two of you. As you discuss this with each other you realize that she has the ultimate authority over her resources time.

8. PROJECTIZED ORGANIZATION Menu Previous Next

9. Menu Previous Next Projectized Organization In a Projectized Organization most of the organizational resources are involved in project work rather than operations. Projectized organizations often have organizational units called departments, and these groups either report directly to the project manager or provide support services to projects. Teams consist of staff members from a variety of disciplines and specialties. These teams are formed and often collocated; physically working in the same place.

10. Menu Previous Next Projectized Organization In a Functional Organization Project Managers are responsible for making project decisions and acquiring and assigning resources. They have the authority to assign resources from other areas within the organization or hire from outside. Project teams have the potential of dissolving upon completing of a specific project. Project Managers have ultimate authority over the project in this structure and report directly to an executive level. The dotted lines on the graphic represent where the Project Manager coordinates projects and the gray boxes represent staff engaged in project activities.

11. Menu Previous Next Projectized Organization Project Manager’s Authority 1 Resource Availability 2 Control of Budget 3 The Project Manager has ultimate authority due to the following: The focus of the organization is the project All resources are focused on projects Loyalties are formed to the project not functional manager The availability of resources is determined by the Project Manager allowing little to no influence from Functional Managers. Resources who are only needed at specific times within a project may find themselves idle other times. Project Managers control the budget to a project.

12. Menu Previous Next Have Skills…Will Work for Project Alex is a training specialist within your organization. He is working with your project team in implementing a new student registration system. Usually, Alex is one of your highest project performers but as of late you have received several complaints from project team members regarding Alex’s lack of workload. You begin to see adverse effects on your teams moral. You approach Alex and he states, “Well, I really don’t know what you want me to do right now. The project schedule doesn’t include the training part until 6 months out once Design, Build and Test phases are complete. I would be glad to do something but what?” You recognize that under a projectized organization you run the risk of having inefficiencies when it comes to resource utilization. You develop a plan with Alex where he can assist the testing team during his down time.

13. MATRIX ORGANIZATION Menu Previous Next

14. Menu Previous Next Matrix Organization There are three types of Matrix Organizations: Weak Matrix Balanced Matrix Strong Matrix Click on the tabs to the right to learn about each one. Weak Matrix Balanced Matrix Strong Matrix

15. Menu Previous Weak Matrix Organization Weak Matrix Organizations share many of the same characteristics of a Functional Organization where the Project Manager has limited authority and is more of a coordinator or expediter than that of a manager. The dotted lines on the graphic represent where the Project Manager coordinates projects and the gray boxes represent staff engaged in project activities.

16. Menu Previous Balanced Matrix Organization The Balanced Matrix Organization recognizes the need for a Project Manager. While it does not provide the Project Manager with full authority over the project and project funding. There is a balance of power between the Project and Functional Managers. Each manager has responsibility for their parts of the project or organization, and employees get assigned to projects based on the needs of the project, not the strength or weakness of the manager’s position. The dotted lines on the graphic represent where the Project Manager coordinates projects and the gray boxes represent staff engaged in project activities.

17. Menu Previous Stong Matrix Organization Strong Matrix Organizations share many of the same characteristics of a Projectized Organization where the Project Manager has considerable independence and authority compared to the Functional Manager. The dotted lines on the graphic represent where the Project Manager coordinates projects and the gray boxes represent staff engaged in project activities.

18. Menu Previous Next Functional Manager Authority Project Manager Authority The closer an organization aligns itself to either a Functional or Projectized Organization Structure determines which manager type has more authority.

19. GO Organizational structure ID View the graphic of the organizational structure and select which structure the graphic represents.

20. Menu View the graphic of the organizational structure and select which structure the graphic represents. Matrix Functional Projectized

21. GO Great Job!

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23. Menu View the graphic of the organizational structure and select which structure the graphic represents. Matrix Functional Projectized

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26. Menu View the graphic of the organizational structure and select which structure the graphic represents. Matrix Functional Projectized

27. In this session you learned about the three different types of organization structures (Functional, Projectized and Matrix) and how they impact the role of a Project Manager. • This concludes the module. Great Job!

28. GO TRY AGAIN