Presentation on theme: "Management organization"— Presentation transcript:
1 Management organization Definition : Management structure establishes the relationship between the project participants together with defining their duties, responsibilities and lines of authority and lines of communication.
2 Organization Structure Types Of Organization Structure:FunctionalDivisionalMatrix
3 The DiagramRepresenting the connections between the various departments within an organizationProvides information about the various tasks performed within an organization and the formal lines of authority between them.
4 The Basic Dimensions of Organizations Hierarchy of Authority: a configuration of the reporting relationships withinorganizations (i.e., who reports to whom)Tall organizations - have many levels in the hierarchyFlat organizations - have few levels in the hierarchy
5 The Basic Dimensions of Organizations Division of Labor : process of dividing the many tasks in an organization into specialized jobsThe more tasks are divided into separate jobs, the more those jobs are specialized
6 The Basic Dimensions of Organizations Span of Control : the number of subordinates in an organization who are required to report to each managerWide span - many subordinates report to a manager- typical of flat organizationsNarrow span - few subordinates report to a manager- typical of tall organizations
7 The Basic Dimensions of Organizations ChiefExecutiveTall hierarchyRelatively narrowspan of control
8 The Basic Dimensions of Organizations ChiefExecutiveFlat hierarchyRelatively widespan of control
9 Functional Organizational Structure Also called Traditional organization structure.Based on the sub-division of disciplines into separate departments together with vertical hierarchyvertical lines of authorityObjective is to emphasize technical excellence.
14 Advantages of Functional Organization SimpleLines of communication within department are well establishedClearly defined responsibility and authority for work within the departments
15 Disadvantages of Functional Organization No Single point of responsibility as project scope moves from one department to another department leading to coordination chaosIt offers excellent facility within its own department ; but for a multi-disciplined projects which calls for interaction with other department then the system may be lacking
16 Disadvantages of Functional Organization Lengthen the lines of communication and slow down the response timeFormal line of communication is through the functional managersCompetition & conflict between functional departmentsDepartment work may take priority over project work
17 Suitability The functional organization is the primary client The project is small
18 Divisional Organizational Structure Positions are grouped according to similarity of products, services, or markets. There are three types of divisional structure.Product StructureGeographic StructureCustomer Structure
19 Product Organizational Structure Product structure groups employees together based upon specific products produced by the company. An example of this would be a company that produces three distinct products, "product a", "product b", and "product c". This company would have a separate division for each product.
20 Product structure characteristics Similar to the functional organization structure except all the departments are dedicated to the product/projectThe Project Manager has high level of authority to manage and control the project resourcesSelf contained unit within own technical staff and administration
21 Vice President Research & Development Product StructureVice PresidentSales and MarketingVice President Research & DevelopmentVice President Materials ManagementCEOVice President FinanceCannedSoupsDivisionPDMFrozenVegetableEntreesBakedGoods4 -214-19
24 Advantages of Product/Project structure Relatively simple means of working on a project. Conflicting responsibilities are minimized.Accountability is clearly placed in one personPM has full authority over projectSimplified coordination across functionsHigh level of commitment to project schedule, technical and cost goals
25 Advantages of Product/Project Structure Strong orientation to customer requirementsRapid reaction time due to ability to make swift decisionsaccurate performance measurement25
26 Disadvantages of a product/Project structure Lack of “big picture” companywide orientationDuplication of effort increases organizational costsDifficult to share individuals/expertise across projectsTendency to retain personnel longer than neededUncertainty about job after the project
27 Suitability Large projects Long-term projects “Crash” projects – emergency responseProjects that change into permanent functional organizations
29 Matrix StructuresThe matrix organizational structure is one in which functional and staff personnel are assigned to both a basic functional area and to product managerThe matrix form is intended to make the best use of talented people within a firm by combining the advantages of functional specialization and product-project specialization
30 Matrix StructuresThis structure is one where there is a combination of functional and divisional structure at the same timeTwo ‘chains of command’, one vertical and one horizontal
31 Objective is to implement a consistent process that delivers reliable analysis. 2
34 Matrix StructuresA matrix is a highly flexible form that is readily adaptable to changing circumstances.Matrix structures rely heavily on committee and team authority.Some companies use the matrix organization as a temporary measure to complete a specific project. The end of the project usually means the end of the matrix
35 Suitability Moderate priority, moderate size projects Projects where efficiency is paramount needWhen project activities closely correlate with those inside the functional organizationObjective is to implement a consistent process that delivers reliable analysis.2
36 Matrix Structure Disadvantages Role conflict, ambiguity decentralized decision makingstrong project coordinationflexible use of human resourcesefficient use of support systemsDisadvantagesRole conflict, ambiguitypotential confusion over authority & responsibilityincreased potential for interpersonal conflicts
37 The Matrix Structure Strengths (cont.) Description More flexibility Efficient allocation of specialistsEconomies of scaleWeaknessesConfusion createdStress placed on workersIncreased ambiguityUnclear reporting relationshipsPower strugglesRole conflictsUnclear expectationsDescriptionCombines two forms of departmentalizationfunctionalproductBreaks unit of commandDual chain of commandStrengthsFacilitates coordinationComplex and independent activitiesBetter communication
38 Choosing a structure Size of project Strategic importance Novelty, need for innovationNeed for integration (# depts. involved)Environmental complexity (# of external interfaces)Budget, time constraintsStability of resource requirementsSmall project focused entirely on the functional departmentLarge project involving many different departments.Objective is to implement a consistent process that delivers reliable analysis.2
39 CONCLUSION focus is on in-depth application of a technology Functional Formfocus is on in-depth application of a technologyMost of the talent/expertise resides in one functional areaSelection of metrics and VEPs measured.3
40 CONCLUSION Product Form firm engages in a large number of similar projects (construction)one-time, highly specific unique tasks that is not appropriate for a single functional area ( product development: marketing, design engineering,manufacturing engineering, quality engineering)
41 CONCLUSION Matrix Form integration of inputs from several functional areasinvolves reasonably sophisticated technologyEmployees effectively have two bossesConflicts with the principle of ‘unity of command’technical specialists are not required full-time