View
50
Download
1
Category
Tags:
Preview:
DESCRIPTION
Product and Brand Management
Citation preview
Organisational Structures
Group 1
Vipul Bali Ranadip Pal Dhruv Samel
Makarand Takale
Why Have a Structure?
All businesses have to organise what they do
A clear structure makes it easier to see which part of the business does what
There are many ways to structure a business
Functional (Classical) Organization
ORGANIZATION STRUCTURES
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
This presentation reviews the three basic
organizational structures and how each
structure effects the role of a Functional
Manager and Project Manager.
Projectized Organization
Matrix Organization
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.
FUNCTIONAL(CLASSICAL) / TRADITIONAL ORGANIZATION
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.
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.
The availability of resources is
determined by the Functional
Manager allowing little to no
influence from Project
Managers.
Competition for resources is
fierce.
The Project Manager has little
or no authority in a functional
organization due to the
following:
1. Staff members report
directly to Functional
Managers
2. A strict chain of
command exists
3. Corporate culture
dictates that you follow
the functional hierarchy
Project
Managers
Authority 1 Resource Availability 2
Control of
Budget 3
Functional Organization
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.
PROJECTIZED ORGANIZATION
Projectized Organization
In a Functional Organization Project Managers are
responsible for making project decisions and acquiring and assigning resources.
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.
Project Managers control the
budget to a project.
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.
The Project Manager has
ultimate authority due to the
following:
1. The focus of the
organization is the
project
2. All resources are focused
on projects
3. Loyalties are formed to
the project not functional
manager
Project
Managers
Authority 1 Resource Availability 2
Control of
Budget 3
Projectized Organization
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
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.
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.
Strong 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.
Functional Weak Matrix
Balanced Matrix
Strong Matrix
Projectized
The closer an organization aligns itself to either a Functional or Projectized Organization Structure determines which manager type has more authority.
Pros and Cons of Different Structures
This depends on the business type, size and structure used
Lets look at a functional structure:
Production Marketing Accounts Personnel IT
Board of Directors
Chief Executive
Functional Structure
Advantages
Specialisation each department focuses on its own work
Accountability someone is responsible for the section
Clarity know your and others roles
Disadvantages
Closed communication could lead to lack of focus
Departments can become resistant to change
Coordination may take too long
Gap between top and bottom
An Example of Organisation by Product/Activity
Imaging and Printing Group
Personal Systems Group
Enterprise Systems Group
HP Services HP Financial
Services
Hewlett Packard
Organisation by Product/Activity
Advantages
Clear focus on market segment helps meet customers needs
Positive competition between divisions
Better control as each division can act as separate profit centre
Disadvantages
Duplication of functions (e.g. different sales force for each division)
Negative effects of competition
Lack of central control over each separate division
Matrix Structure
Advantages Individuals can be chosen
according to the needs of the project.
The use of a project team that is dynamic and able to view problems in a different way as specialists have been brought together in a new environment.
Project managers are directly responsible for completing the project within a specific deadline and budget.
Disadvantages A conflict of loyalty between
line managers and project managers over the allocation of resources.
Projects can be difficult to monitor if teams have a lot of independence.
Costs can be increased if more managers (i.e. project managers) are created through the use of project teams.
Summary
Organizational Structure
Functional Organization
Divisional/Product structure
Matrix structure
Application Area Best suited as a producer of standardized
goods and services at large volume and low cost.
An automobile company with a divisional structure might have one division for SUVs, another division for subcompact cars, and another division for sedans.
When typical bureaucracy: top-heavy and hierarchical with multiple levels of command exist . All this makes co. apprehensive to market changes leading to its incapacity to grow and develop further. The failure of this structure became the main reason for the company restructuring into a matrix.
THANK YOU
Recommended