PMP free course - Advantages and disadvantages of different organizational structures.
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PMP free course - Advantages and disadvantages of different organizational structures.

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PMP prep exam free online course- Introduction & the environment in which project operate -
Advantages and disadvantages of different organizational structure.



In the previous article (PMP prep exam free online courseIntroduction &the environment in which project operate - part 4 -organizationstructure) we took the types of organization structures, during this articles we will going to explain the advantages and disadvantages of each organizational structure functional, projectized, and matrix organization respectively. 


- Advantages of functional organization.

* Easier management of specialists.
Because resources specialists in an area report to same manager who knows the domain or area as well.

* Team members report to only one supervisor.
This reduced the conflicts of reported to both project and function manager.

* Similar resources are centralized.

For example, software developers to IT department. This ensure the sustainability of an organization.

* Clearly defined career paths in areas of specialization.

Because the staff belong to the departments specialized in an area and improvement skills, knowledge, and competence in that specialization can be proposed as career path for the resources.
For example, Developer then senior developer then expert developer...etc.

- Disadvantages of functional organization.



* People place more emphasis on their functional specialty to the detriment of the project.

Because the ultimate manager is the function manager. Although, there are assigned to a project they take a direction of their function manager more seriously compare to a project manager. 

* No career path in project management.

The project manager has a little or no authority because staff mainly report to function manager and therefore, project manager is not having that much power or influence on project team.


- Advantages of projectized organization.

* Efficient project organization.

Because all resources of the project are dedicated to the project task and assignments. This dedication automatically increases the focus of the team members for the successes of the project.


* Member of project team is more loyalty to the project.

Because the ultimate manager is project manager. The success of project directly depends on a team member and this increase the loyalty to the project, respectively.


* More effective communications than functional.

Because team members are dedicated for a project and there existing in an organization is sole for the project they are working for. Project teamwork in same location and even in the same room in projectized organization, it is increasing the effective and efficient communication among the project team.


- Disadvantage of projectized organization.

* No home for the project resources when project is finished.


This is the most important disadvantages. Since there are not departments for resources based on the specialties, if there is not be a new project resources are released at the end of the project.


* Lake of professionalism in disciplines.

For example, a software engineer work in a project at the end of the project if he leave the organization because there is no new project, this cause the organization loose professionalism disciplines. 

* Duplication of facilities and job functions.

Tools and resources of a project belong to only one project in projectized organization.
For example, a project need a testing tool to complete the quality assurance activities in a project, if the same tool will be needed for second project in the organization a new tool need to purchase for the new project team since the existing tool sole belong to the first project team. This cause duplication of the same testing tool for the second project and additional cost for the organization effectively.

* Less efficient use of resources.

Since project resources are dedicated to a project even if a resource is not 100% utilize that resource cannot be allocated to another task.

- Advantages of matrix organization.

* Highly visible project objectives.

What needs to be achieved to complete the project successfully are clearly defined and understandable by the project team.

* Improved project manager control over resources.

Because the team members of the project are reporting to the project manager as well and this gives respective authority to the project manager.

* More support from functional areas.

Because resources are grouped based on their specializes and in case of a lake of technical knowledge, resources can consult to senior or managers on the same function domain.

* Maximum utilization of scarce resources.

For example, if the software engineer needs to support a project for only two days, he is can assign to other projects or activities for the remaining days of the week.

* Better coordination.

* Better horizontal and vertical dissemination of information.

Every resource belongs to a function and he has a functional manager, if he assign to a project, he is report to a project manager as well. This structure strengthening the dissemination of information and better coordination of the staff.

* Team members maintain a “home “

So, even if they are released from project they turn back to their department and do department mental work or when a new project is initiated, they can be reassigning to new project.

- Disadvantages of matrix organization.

* Extra administration is required.

Because there will be two managers of a resources, function manager and project manager. Also, will be several resources from different function disciplines in a project. This will bring additional administration for sure.

* More than one boss for project team.

* More complex to monitor and control.

Because there are several disciplines and will be several resources from the several functional departments in the project. This will require management and coordination of different functional managers. Therefore, it is more complex.

* Tougher problems with resources allocation.

The main reason if this is there are a lot of projects need resources from a single function department.
For example, the software project in a company, software engineers’ resources will be requested from the software development department, if it is a lot of projects initiated this will cause resource allocation problems, respectively.

*  Need extensive policies and procedures.

Since there will a lot of function departments and resources, in order to avoid conflicts, these need to be supported with the policies and procedures.
For example, how to request resources for the project, how priorities the projects if they ask the same resources, how to release the project team members, etc. need to document clearly to avoid any misunderstanding between the departments.

* Functional managers may have different priorities than project managers.

* Higher potential for conflict.

For example, a department has own works and a project manager is require a new resource from this department, the function manager not need to assign this resource to the project since he want to complete the department work first. These kinds of conflicts may raise in matrix organization. 
















































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