In the last lesson, we examined different types of project organizations and the advantages and disadvantages of each. Now we want to take a look at how we select the project organization for our project. In this lesson, we'll examine how to select the appropriate organization for your project, which factors may govern this choice and how the project type and size might influence this choice. With that in mind, let's get started. The biggest influence on type of project organization you select for your project may be the culture, resources capabilities and typical way of doing business of the organization you work for. All the factors shown here will influence the ability of a project manager to be successful. It will impact the execution approach and guide how the project will proceed. Most projects follow the method that the organization feels most comfortable with, even if few believe another approach is better, you may not have the choice. Most organizations have a preferred organization style they use with virtually all of their projects. If this has proven successful, why change? The only convincing reason to change, is a current project does not fit the pattern of the organizations previous successes. Over the course of this discussion, we will review which factors influence project organization choice and which projects are typically executed and which format, hopefully this will give you some basis to select the project organization style or to recommend the change from your organization standard. What are some of the special factors that may influence your selection of project organization style? Each of these factors could have a major influence on what project organization style is used on a project. For instance, if the organization does not have a lot of resources, then it's not likely to use a project based organization, you can spare the resources from its ongoing operations. If the project is short duration, it may not be worth disrupting the operation for the short time the project is running and so forth. So in the next few minutes we'll examine some of the factors and their impact on the organizations thinking. Functional Based Organizations, what types of projects have been successfully executed in these environments? Where do we typically see these projects approaches used? Functional based organizations work best in small organizations with limited resources, these organizations cannot afford to move people out of their positions to work on a project. These organizations work best with simple small projects, that are very similar to the projects the organization executes on an ongoing basis. These projects are typically low cost, low risk and can be conducted in the normal course of business and are not schedule critical. What are some examples of projects that fit in this category? Standard software updates come in the mind, not the big complicated ones where you do the program, but the ongoing updates and new releases to fix things or optimize performance. Concept studies, these are the studies before the project is authorizer or even fully defined. These are typically done by staff members within their function and prove whether or not the larger project is worth pursuing. Till a project proves economic, it's not usually worth creating a project team. Similarly, project definition studies, which take the concept studies and advance them to the next step are done in a functional organization. These studies start to put some of the project requirements and specifications together to give the concept more definition in anticipation of a project being authorized. Again, until the project is authorized, limited expenditures are the rule. Weak matrix Organization, projects executed in a weak matrix organization tend to be small projects of limited duration. They tend to be relatively simple, with few changes in execution approach or scope relative to projects typically undertaken by the organization. Like the functional based projects, they tend to be low cost and low risk in nature with moderate schedule pressure. Example projects might include maintenance projects. An example might be a minor pump repair, each department manages its portion of the work, but it's all coordinated by one engineer. For instance, first the electrical group might come out and disconnect the pump from the power, the piping group disconnects the pump from the piping, and the mechanical group makes defense of the pump. The process reverses itself then everything's put back together, all under the direction of the unit engineer. Another example is when the organization puts together a task force to recommend changes. Each function nominates a representative, puts together its recommendations, one member of the group coordinates those responses and oversees the process. The final report is usually a group effort also. Concept selection studies, after the concept for the project has been defined and the requirements set forth, the organization may study various options and configurations to determine which ones have the best potential to produce the best results. These configurations studies and options screenings are usually done in a weak matrix organization for small to medium sized projects. Each function screens the options for its section of the project and puts forth a concept or concepts. A single engineer coordinates the effort and pulls together the final review. Finally, a technology strategy development project may also follow a similar approach to the concept selection study or the task force recommendations and use a weak matrix structure. The Balanced Matrix Organization, where is it used? These projects tend to be larger in scope and more complex than those that successfully use the functional or weak matrix organizations. They are small to moderately sized and slightly more complex, requiring more coordination to be successful, typically the organization has some experience with these projects and the cost and schedule pressures is not intense. Examples include relocation operations, the organization is scheduled to move their operations to a new location, therefore it requires some degree of coordination to make sure it comes off in a coordinated fashion, but each function needs to be coordinated and control the move of its people. Reorganization projects across multiple functions. Again, the project needs a central coordinating function to make sure the organizations are compatible and synchronize, yet much of the work needs to be done within the functions. The strong matrix organization, as the projects grow in size and become more complex, the strong matrix organization becomes a better choice. Because the projects still share resources, a strong matrix organization may struggle with schedule and typically are not good at a lot of change. They're good however when these types of projects require strong functional input and we have a moderate amount of risk exposure. Some good examples of strong matrix organization projects include feasibility studies for large projects, where we want to have all the technical input from the functions, with the coordination control of a project based organization. These projects tend to be too large for a part time project manager to keep track of and control, and they need more attention because their size and complexity. The engineering design portion of a construction project can be effectively done using a strong matrix approach, particularly if the construction is being handled by another organization. The project manager identifies staff in each one of the engineering disciplines to execute the design and uses the strong matrix approach to make the engineering more efficient. The approach is particularly good if technology is important and experts required that are not available full time. However, it may not be as good on projects where the schedule is short and a significant amount of changes are expected. New software development can be done in the same manner using similar techniques. The final example is a plant turnaround. This is a short duration event in which the plant is modified or maintained on a crash basis. Typically there is a central group who plans and manages the entire event, then each department or function loans their personnel and oversees their portion of the work. The short duration makes it less efficient to form a task force to complete these tasks, but the short schedule and higher risk require full time management attention. The final organization type we're going to review is the project oriented organization. We typically see this organization used on longer duration larger projects. It is particularly appropriate for high risk projects that are strategically important, where a highly focused team can make all the difference. We see this organization style particularly in project based organizations that execute large complex projects in remote locations, or projects that involve multiple units. Examples include large scale public works such as major highways, bridges and infrastructure such as dams or power lines. These projects require a lot of coordination and may be spread out over a large area. The logistics may be complex. Another example of this type of large scale public project is a NASA space station. It has the added complexity of being very high risk with a lot of coordination. Grassroots refinery design and construction, this is a large new built facility with multiple interconnecting units. These projects are typically schedule and cost driven with complex interfaces within the facility and with existing facilities. The logistics to design purchase and deliver material to support construction is a highly complex, a highly focused and dedicated team can make all the difference. Similarly, major offshore developments fall into this category for many of the same reasons. In summary, as the projects grow in size, duration and complexity, as they become more unique and strategically more important to the organization, as they increase in risk and cost, then the more complex project organizations make sense. As more of these situations occur, the more we should move toward a stronger project manager organization structure. The more we should move from a purely functional approach, to a purely project based approach. None of these guidelines are set in stone. Successful projects of different sizes and complexity have been successfully executing using various methodologies. The best approach to determine a good project organization style for your project is to look to history. If your organization has a successful history applying certain styles to a certain project types, then chances are that is the best approach. The major caution here is to make sure that your project is comparable to those executed in the past and does not have some unique feature, time scale, a risk that may cause you to change. Next, we're going to look at the project management processes.
