Functional organizational structure project manager authority

The functional organizational structure is a particular type of organization in which a company can decide to organize itself. The structure of an organization determines how employees, teams, and work responsibilities are organized in order to meet final needs and goals. In a functional organizational structure, the employees are divided into departments characterized by the similarity of the tasks and the projects are carried out within the individual departmental units. A functional organizational structure is composed by project team members allocated according to the different functional units of an organization. Each unit is managed by a functional manager who reports to the strategic direction of the organization.

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Content:

• Organizational Structures: How do they impact the project?
• Organizational structures and project management
• What is a balanced matrix organization?
• 8 Common Types of Organizational Structures in Project Management
• Which Type of Organizational Structure Gives the Least Amount of Authority to Project Managers?
• 2.2. Structures

Organizational Structures: How do they impact the project?

Organizational structure refers to the way a company or organization is setup. It is usually defined using a hierarchy chart that shows how groups or functions report within the organization. For Project Managers, a company's organizational structure type will affect how resources are allocated to the project and will be a factor in how much influence the Project Manager will have within the organization.

Three Types of Project Management Structures: An organizational structure could be described as the official line of authority and control within an organization. Project management structures tell us how reporting relationships work in a particular organization. Depending on the environment the organization finds itself operating in, the goals they set for themselves and the nature of work being done, you would find that organizations are structured in 3 ways:.

Functional Organizational Structure In a functional organizational structure, you would find the components of a hierarchy system where authority-driven decisions on budget, schedule, and equipment rest on the shoulders of the functional manager who possesses a significant level of expertise in the same field.

That is to say that the project manager, in this type of organization has little to no authority here; in some functional organizations, that position does not even exist. What would you find, however, is that the work is broken down into departments such as the human resource department, sales department, finance, public relations, administration, etc. In simple terms, it can be likened to that of a more traditional company where staff is presided over by a supervisor, based on their functions within the organization and communication is most often done through the department heads to senior management.

What is fascinating about this type of organizational structure is that employees appear to be more skilled in their respective departments, thereby leading to greater work efficiency.

Everyone knows who to hold accountable if something were to go wrong as responsibilities are predetermined. On the downside, the work may prove monotonous over time, which could result in less enthusiasm and reduced loyalty to the organization. In addition to that, you would also find that cross-departmental communication becomes poor and the high level of bureaucracy could affect decision-making negatively.

In a functional organization, every employee is positioned within only one function and has one manager they report to, the Functional Manager. The Functional Manager assigns and manages the employees work and handles administrative tasks such as employee compensation. Project Based Organizational Structure The projectized organizational structure is the complete opposite of the functional organizational structure even though the organization may still group staff according to their work functions.

In this case, the project management team structure is organized in such a way that the project manager has project authority. You would find him at the top of the hierarchical structure, calling all the shots; with employees playing supporting roles for the project. At the end of the project, the project team members are released and resources directed towards more relevant areas.

Communication becomes easier and more effective and project team members gain more experience working on different types of projects as the need for them arises. A major disadvantage to this type of organizational structure, however, would be that employees could see themselves being under a lot of pressure most of the time, especially if they happen to work on multiple projects at the same time.

The key challenge with a matrix organization is that every employee has two or more managers they report to, their Functional Manager and the Project Manager. If they are working on multiple projects, they may have even more managers to report to. The matrix organizational structure can be found lying somewhere between the functional organizational structure and the projectized organizational structure depending on what type of matrix structure is being run.

For instance, the strong matrix organizational structure has some similarities with that of a projectized organizational structure in the sense that the project manager is responsible for a project. If the organization is running a weak matrix structure, then the project authority would fall to the hands of a functional manager — as it is in a functional organization.

Interestingly enough, in a balanced matrix organization, both the project manager and the functional manager shares equal authority for the project. If an organization finds itself working in a dynamic environment, then this might be the right structure to run with it and it promotes greater efficiency, helping the organization respond to customer demands or changes in the marketplace, faster.

This is easily achieved because while the project manager exhibits project authority in a horizontal manner, the functional manager does so in a vertical, flowing downwards. For example, the project manager could be responsible for handling project schedule or budget while the functional manager would be responsible for outlining and distributing responsibilities, overseeing the performance of the equipment, etc.

A weak matrix organizational structure maintains many of the features of the functional organizational structure. The role of the Project Manager is more that of a Project Coordinator. Their ability to make or enforce decisions is low and most of the authority remains with the Functional Manager.

A balanced matrix organizational structure recognizes the need for a Project Manager. However, the Project Manager does not have full authority over the project, project staff or project budget. A strong matrix organizational structure has many of the features of the projectized organizational structure. They have full-time Project Managers and project administrative staff.

Project Managers have considerable authority over the project in this organzational structure. Two of the key project aspects affected by organizational structure types are Project Manager Authority and Resource Availability. As you move across the spectrum from Functional to Matrix to Project-Based organizational structure types, the organization will move from favoring ongoing operations to favoring projects.

On the left side of the spectrum are Functional Organizational Structures. As a Project Manager, you will have limited positional authority in these type of organizations. You will need to rely on expert authority and referent authority to get project tasks completed. Because of this, you will need to develop your influencing and negotiating skills if you want to be successful.

From a Resource Availability perspective, you will be dependent on the Functional Managers in your organization to provide you with resources. In these cases, the project resources will report indirectly to you. On the right side of the spectrum are Project-Based Organizations.

As a Project Manager, you will have more positional authority the further right your project sits on the spectrum. This doesn't mean you can just command others, but you will have more formal authority for getting project tasks completed.

From a Resource Availability perspective, you will also have greater control over your project resources since they will be more likely to directly report to you and not to a functional manager. Understanding what type of organizational structure is used by your company will help you determine how you should manage your project. Login Sign-Up. Blogs Organization Structure of Project Management. Organization Structure of Project Management Sep 12, Introduction to Organizational Structure of Project Management Organizational structure refers to the way a company or organization is setup.

Examples of functions within a company are: Advertising Engineering Human Resources Manufacturing In a functional organization, every employee is positioned within only one function and has one manager they report to, the Functional Manager. Matrix Organizational Structure Matrix organizations blend features of project-based and functional organizational structures.

There are three types of matrix organizations: Weak Matrix Balanced Matrix Strong Matrix The matrix organizational structure can be found lying somewhere between the functional organizational structure and the projectized organizational structure depending on what type of matrix structure is being run.

Weak Matrix: A weak matrix organizational structure maintains many of the features of the functional organizational structure. Balance Matrix: A balanced matrix organizational structure recognizes the need for a Project Manager. Strong Matrix: A strong matrix organizational structure has many of the features of the projectized organizational structure.

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Organizational structures and project management

Matrix management organizations are difficult to manage properly. One of the difficulties in matrix management is balancing the level of authority between the functional manager and the project manager. If the project manager has too much authority, too many of the people in the functional organization will be taken from that organization and assigned improperly to the projects. If the functional manager has too much authority, the organization essentially stays a functional organization and never becomes a matrix management organization. If the functional manager is able to dominate the project manager, the organization will remain much as it was when it was a functional organization.

What is a balanced matrix organization?

Fahad Usmani, PMP. August 15, Companies that produce the same goods consistently and have routine operations use a functional organizational structure because its rigid structure provides predictable stability. An organization can adapt to any structure it requires. If the business mainly handles projects, it will choose a projectized structure. Whereas an organization dealing with operations will stick with a functional structure. Your working style accommodates your organizational structure, as it defines your role and responsibilities and shapes the work culture. This culture includes the work environment, reporting system, hierarchy, etc. Every organizational structure has a different system.

8 Common Types of Organizational Structures in Project Management

In discussing organizational structure the following principles are important:. Authority — Is the right to make decisions, issue orders and allocate resources to achieve desired outcomes. This power is granted to individuals possibly by the position so that they can make full decisions. Reliability — Is the degree to which the project team member can be dependent on to ensure the success of the project with a sound and consistent effort.

Which Type of Organizational Structure Gives the Least Amount of Authority to Project Managers?

There is no single organizational approach to projects. Each project is organized to accomplish the work effectively and efficiently. Several factors influence the organizational approach to execute a project. In developing the project organizational structure, the project manager considers the span of control The number of people reporting to a manager. The span of control represents the number of people reporting to a manager. For example, the project manager does not want all the engineers on a project reporting to the engineering manager and assigns senior engineers to report to the engineering manager with other engineers reporting to the senior engineers.

2.2. Structures

Organization types are a framework that determines the hierarchy of people, function, and workflow—along with the reporting system in an organization. Every organization should have a defined organization structure in order to work efficiently and achieve its business goals. Some say that without a defined organization type and structure that helps support its objectives, that organization will not succeed. As a project manager , this will help you identify the stakeholders and other team. Skilled project managers typically prefer a projectized organization to others. Are you looking to take your project management career to the next level? Are you a professional who is aspiring to be a project manager?

Project organization structure is used to complete a project or task. The project manager has people from several functional departments such as production, finance, marketing and so on. Specialists are drawn to perform their respective roles in the total project. The project organization structure is derived not from some principles but from the job requirements.

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There are three broad structures by which an organization can be organized: functional, matrix, and projectized. These structures represent a continuum, from structures where the project manager has very little authority functional to those where project managers have very broad power projectized See Figure There have been many studies about the impact that organizational structure has on project success, and it is not uncommon for corporations to change their organizational structure in order to increase their relative success in executing projects on time and within budget. This type of change takes great effort and may take a long period of time to fully implement. Instead of changing their entire structure, an organization may elect to create a dedicated project team in order to carry out a critical project without reorganizing the entire enterprise. This way, they can get many of the same benefits of the projectized organization without reorganizing the enterprise.

The Project Management Organization Structure is an enterprise environmental factor that plays an important role in determining the way, in which the organization and Project Manager perform. Project organizational structure is helpful to know and understand the organizational structure and the culture of the entity in which the project management is working. Although uniqueness abounds in business cultures, a project management structure is designed by using one of three ways: Functional, Projectized or Matrix. Organizations have their own styles and cultures that influence how project work is performed.