Project organization.

- PROJECT ORGANIZATION:

Project organization is the engine of project management. It coordinates and integrates human and non-human resources of the project. It lays down rules and regulation for the project's operations, activities, and administration of the project, outline the relationship between project participants, establishes relationship, indicate communication lines and channel between project manager with project team and external stakeholders and provides basis for integration and coordination of human and non-human resources in the project.
   The project organization should be action oriented. It should be flexible to facilitate adaptation of changes in responsibilities of team members during various project phases. It should be non-bureaucratic. The project organization is a temporary organization. It lasts till the life of the project. The design of project organization structure depends on the nature, objective, size, technology, complexity and constraints of each project of project organization structure can be
1. Pure functional organization structure
2. Pure project organization structure
3. Matrix organization structure

1. Pure Functional Organization 
Pure functional organization is traditional type of structure where total work of organization is divided into various functional department or units as per requirement for making easy management. The required departments are handled by functional managers. A project is assigned to functional department as a result all the project activities are performed under the control of functional manager in functional department. The project is also headed by concerned department manager and the manager can hire required specialist for project purpose.
   Project board is the highest body of pure functional organization. Qualified, experienced and knowledgeable persons work as higher authorities and project managers remain under them. The project manager has the full responsibility of the project. So, project manager should be qualified, experienced and competent. He should be able to get cooperation and support from high and immediate low level. Department managers remain under the project manager.
Department managers are appointed to run the each department effectively. For example finance manager, technical manager, marketing manager etc. Different contractors also work under the project manager. They have direct contact with project manager whereas indirect contract with department mangers

This type of structure is more appropriate for small project.

Pure Functional Organization


 Advantages of Pure Functional Organization:
• It provides maximum flexibility in use of existing staff.
• It develops expertise and specialization in human resources.
• It makes possible better supervision and control of the project.
• It facilitates the mass production.
• The functional department provides technical and other support for project success.
• Individual experts can be utilized by different projects.




2. Matrix Organisation -
Meaning
Matrix Organisation is a combination of two or more organisation structures. For example, Functional Organisation and Project Organisation. So this is also called mix and unified organization. This type of organization supposed to be very effective in project management.Matrix Organisation was introduced in USA in the early 1960's. It was used to solve management problems in the Aerospace industry.

A matrix organization is a kind of management system, whereby people who have similar skills will be gathered together from different part of company to work on particular assignments. So for instance, all engineers may be working within one particular engineering department, and be under the same management - but these engineers will no doubt be assigned to a number of different projects, and have to report to different project managers during the process of completing the project. Hence, every engineer within the workplace will have to work under a number of different managers in order to get their own particular job done.
For example ,The organisation is divided into different functions, e.g. Purchase, Production, R & D, etc. Each function has a Functional (Departmental) Manager, e.g. Purchase Manager, Production Manager, etc.
The organisation is also divided on the basis of projects e.g. Project A, Project B, etc. Each project has a Project Manager e.g. Project A Manager, Project B Manager, etc.
The employee has to work under two authorities (bosses). The authority of the Functional Manager flows downwards while the authority of the Project Manager flows across (side wards). So, the authority flows downwards and across. Therefore, it is called "Matrix Organisation".
An example of matrix organisation is shown in the following diagram:-


 Features of Matrix Organisation

The characteristics or features of a matrix organisation are:-
1. Hybrid Structure : Matrix organisation is a hybrid structure. This is so, because it is a combination of two or more organisation structures. It combines functional organisation with a project organisation. Therefore, it has the merits and demerits of both these organisation structures.
2. Functional Manager : The Functional Manager has authority over the technical (functional) aspects of the project.

The responsibilities of functional manager are:-
i. He decides how to do the work.
ii. He distributes the project work among his subordinates.
iii. He looks after the operational aspects.

3. Project Manager : The Project manager has authority over the administrative aspects of the project. He has full authority over the financial and physical resources which he can use for completing the project.

The responsibilities of project manager are:-
i. He decides what to do.
ii. He is responsible for scheduling the project work.
iii. He co-ordinates the activities of the different functional members.
iv. He evaluates the project performance.

4. Problem of Unity of Command : In a matrix organisation, there is a problem of the unity of command. This is so, because the subordinates receive orders from two bosses viz., the Project Manager and the Functional Manager. This will result in confusion, disorder, indiscipline, inefficiency, etc. All this will reduce the productivity and profitability of the project.
5. Specialization : In a Matrix organisation, there is a specialization. The project manager concentrates on the administrative aspects of the project while the functional manager concentrates on the technical aspects of the project.
6. Suitability : Matrix organisation is suitable for multi-project organisations. It is mainly used by large construction companies, that construct huge residential and commercial projects in different places at the same time. Each project is looked after (handled) by a project manager. He is supported by many functional managers and employees of the company.

 Advantages of Matrix Organisation

The benefits or merits or advantages of a matrix organisation are:-
1. Sound Decisions : In a Matrix Organisation, all decisions are taken by experts. Therefore, the decision are very good.
2. Development of Skills : It helps the employees to widen their skills. Marketing people can learn about finance, Finance people can learn about marketing, etc.
3. Top Management can concentrate on Strategic Planning : The Top Managers can spend more time on strategic planning. They can delegate all the routine, repetitive and less important work to the project managers.
4. Responds to Changes in Environment : Matrix Organisation responds to the negative changes in the environment. This is because it takes quick decisions.
5. Specialization : In a matrix organisation, there is a specialization. The functional managers concentrate on the technical matters while the Project Manager concentrates on the administrative matters of the project.
6. Optimum Utilization of Resources : In the matrix organisation, many projects are run at the same time. Therefore, it makes optimum use of the human and physical resources. There is no wastage of resources in a matrix organisation.
7. Motivation : In a matrix organisation, the employees work as a team. So, they are motivated to perform better.
8. Higher Efficiency : The Matrix organisation results in a higher efficiency. It gives high returns at lower costs.

 Limitations of Matrix Organisation

The demerits or disadvantages or limitations of a matrix organisation are:-
1. Increase in Work Load : In a matrix organisation, work load is very high. The managers and employees not only have to do their regular work, but also have to manage other additional works like attending numerous meetings, etc.
2. High Operational Cost : In a matrix organisation, the operational cost is very high. This is because it involves a lot of paperwork, reports, meetings, etc.
3. Absence of Unity of Command : In a matrix organisation, there is no unity of command. This is because, each subordinate has two bosses, viz., Functional Manager and Project Manager.
4. Difficulty of Balance : In a matrix organisation, it is not easy to balance the administrative and technical matters. It is also difficult to balance the authority and responsibilities of the project manager and functional manager.
5. Power Struggle : In a matrix organisation, there may be a power struggle between the project manager and the functional manager. Each one looks after his own interest, which causes conflicts.
6. Morale : In a matrix organisation, the morale of the employees is very low. This is because they work on different projects at different times.
7. Complexity : Matrix organisation is very complex and the most difficult type of organisation.
8. Shifting of Responsibility : If the project fails, the project manager may shift the responsibility on the functional manager. That is, he will blame the functional manager for the failure.


Note- A Matrix structure organisation contains teams of people created from various sections of the business. These teams will be created for the purposes of a specific project and will be led by a project manager. Often the team will only exist for the duration of the project and matrix structures are usually deployed to develop new products and services. The advantages of a matrix include
• Individuals can be chosen according to the needs of the project.                            
• The use of a project team which 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.
Whilst the disadvantages include
• A conflict of loyalty between line managers and project managers over the allocation of resources.
• If teams have a lot of independence can be difficult to monitor.
• Costs can be increased if more managers (ie project managers) are created through the use of project teams.

- Project authority:
Authority is the right to make and implement management decisions. It is also the right to influence others and use resources. It is empowerment
  Authority is the right to act, or command others to act, towards the attainment of organizational goals.
 A project manager has total responsibility for the project from inception to completion. This responsibility cannot be discharged without authority. Authority is the key to project management process.
Project authority is the right to :
A: Act: make decisions about resources such as men, materials , money and equipment related to project.
B: Order: command or direct the activities of others in the project.
Authority is delegated by top management to the project . It can be added ,subtracted or withdrawn. The greater the risk in the project , the greater the amount of authority needed.

matrix Responsibility Chart/Linear Responsibility Chart
A project achieves specific objective within constraints of time, cost and quality. In project, there are several participants which are as follows:
General Manager: Executive chief of the organization
Manager of Projects: Chief of project department
Functional Managers: Chiefs of functional departments
Project Manager: Chief of a specific project

The authority and responsibility of the various project participants in the activities and decisions of the project can be:
a) Actual responsibility for getting the job done.
b) General supervision responsibility.
c) Must be consulted.
d) May be consulted.
e) Must be notified.
f) Must approve.

There should the clear authority-responsibility relationships among the project participants so as to remove confusion and conflicts in project. The main mechanism for such purpose is Matrix Responsibility Chart (MRC).

Linear Responsibility Chart is also known as linear chart (LC), Matrix Responsibility Chart (MRC), Responsibility Interface Matrix (RIM), Responsibility and Accountability (RAM). It is the chart of responsibility which identifies the project participants and shows authority and responsibility relationship among the project participants due to their overlapping involvements in project management. The participants may be general manager, manager of projects, project manager and functional managers. It clearly specify the authority and responsibility relationships of project participants to avoid confusion and conflicts. Specially, it is used in matrix organization structure in order to minimize the confusion and conflicts between project manager and functional managers. It explains what and who of project work. It links the project activities or task to the responsible person which ensures effective implementation of project to achieve defined objectives within constraints.

LRC is prepared to find out responsibility center of all key activities in the project and for those purpose, LRC is divided into rows and columns and numbers. The rows of LRC indicate activities, responsibility and authorities. The columns identify the position of the project participants and numbers indicate the degree of authority and responsibility existed between rows and columns of LRC, the numbers can be symbol.

The Matrix Responsibility chart is divided into: (The chart cannot be uploaded here, i will upload its snap in near future.)
a) Rows: They indicate activities, responsibilities, authority.
b) Columns: They identify position of project participants.
c) Numbers: They indicate the degree of authority-responsibility existing between the rows and columns. They can be symbols.

Linear Responsibility Chart
Symbols/ Codes:
1 = Actual responsibility
2 = General responsibility/ General Supervision
3 = Most be consulted
4 = May be consulted
5 = Must be notifies
6 = Must approve

The advantages of Matrix Responsibility Chart or Linear Responsibility Chart are as follows:
a. It describes the role of project participants in project matters. Authority, responsibility and accountability for project activities are delineated among various project participants. Problem-solving becomes easier.
b. Communication is facilitated. It cuts red tape.
c. It is a useful tool for supervising of authority and responsibilities.
d. There is delegation of authority.
e. It postures coordination because it clarifies rules and responsibility, authority and responsibility relationships for project activities among the participates. It reduces confusion and conflict between project manager and functional managers. It helps to monitor responsibility of project participants. It combines organizational structure with work breakdown structure which makes easy to fix responsibility to project participants.

The disadvantages of Matrix Responsibility Chart or Linear Responsibility Chart are as follows:
a. It does not describe about people interactions in the project. It is a mechanical aid.
b. All relationships may be difficult to delineate.
c. Customer-imposed requirements may limit its usefulness.
d. It acts as mechanical tools for fixing responsibility only but not defines the relationship between project participants. It tries to express authority-responsibility relationship in specific terms. But situation and degree of all relationship may be difficult to express. Project is customer oriented and always impose requirement. The requirement may limit the usefulness of LRC,