Leading Projects in an Organizational Context PDF

Leading Projects in an Organizational Context BUSN 10276 Week 2 Sandra Napoleone  Today Brief review of last week Organizational structures The three traditional types of organizational structure...

Leading Projects in an Organizational Context BUSN 10276 Week 2 Sandra Napoleone  Today Brief review of last week Organizational structures The three traditional types of organizational structures and their advantages and disadvantages Describe horizontal and network structures and their advantages and disadvantages 2  Week # 1 How business has changed and evolved? Modern business, traditional business. What an organizational structure is? Why it’s important for PM’s to know about organizational structures. What the differences were with modern, traditional business is. Why businesses will engage in delivering projects. What business progress means to projects. 3  Organizational Structure Mechanistic structures A mechanistic structure is a vertical, organic structure where a central body is responsible for assigning tasks. This body has all the power and creates and oversees departments and employees with dedicated roles. The essence of employing this system is to ensure maximum productivity in any organization. Common among universities, government agencies, and the healthcare sector. Organic organizational structure A flexible workplace with a horizontal mode of communication. Horizontal or flat methods of communication mean that employees share their responsibilities in groups and teams and interact with different departments, managers and colleagues to complete work successfully. Organic organizations encourage more adaptable workspaces and communication between all levels of a company to promote a welcoming, changing environment that values the opinions of all employees. Source - Indeed  Organizational Structure Simply put a mechanistic organization, communication is relayed from the top-down, decision-making is centralized, there is a strict reporting hierarchy, and everything must be done according to the established rules and procedures. An organic organization, on the other hand, is more flexible and open to change.  Mechanistic Vs Organic Mechanistic (Vertical) Organic (Flat) Specialized Tasks Common Rigidly Defined Tasks Broadly Defined Centralized Authority Decentralized Vertical Communication Horizontal Rigid Departmentalization Unit Cross-Functional Teams Clean Chain of Command Hierarchy Cross-Hierarchical Teams Narrow Span of Control Wide High Formalization Low  Functional Structure Marketing Manufacturing Accounting  Functional Structure Advantages Disadvantages Develop functional Integration and expertise coordination can Commitment to the be challenging function and its standards Slower decision of performance making Promotes standardization Information sharing Facilitates centralized and collaboration can activities – payment be problematic processing, policies  Functional Structure Attributes Smaller organizations Product or services are singular or smaller Smaller number of markets Cycle time for delivery can be long  Divisional Structure Product Product Division 1 Division 2 Marketing Manufacturing Accounting Marketing Manufacturing Accounting  Divisional Structure Advantages Disadvantages Focus leads to Duplication of effort and improvements resources Customer satisfaction Lost economies of scale Responsiveness to Decreased opportunity market and for technical environment specialization Coordination across Standardization is functions harder Decentralized decision Coordination and making collaboration problems Divisional Structure Attributes Company size generally larger Products or service offerings are larger, several versus singular Markets, rapidly changing and unpredictable Cycle time depends can be longer and shorter Technology, nonroutine and depends on several functional areas Strategy is generally adaptive, customer service focused  Matrix Structure Marketing Manufacturing Accounting Product Division 1 Product Division 2  Matrix Structures Defined Matrix structures have a dual focus, usually products and functions. It is an attempt to profit from the advantages of both functional and product structures. Common in large companies like GM, Cooperators, Apple, Google etc. industries like insurance, pharmaceutical, and financial services NOTE – in this type of structure having both a product leader and a functional leader can cause confusion and conflict (think competing for the same resources)  Matrix Structure Advantages Disadvantages Collaboration across Can be confusing to the areas, departments team members Reduced costs Decision making can be Better resource slower, can be more utilization people involved in the Increased productivity process Standardization Inconsistencies across product(divisions_ Competing priorities Standardization  Matrix Structure Attributes Pressure to share scarce resources across product lines Environmental pressure for two or more critical outputs Environment is both complex and uncertain Competing delivery priorities  Horizontal Structure - defined Horizontal corporations are flat structures with minimal layers of management and self-managing multidisciplinary teams organized around core processes  Horizontal Structure Nurse Coordinators Team Team Team Patient Flow Nurse Coordinators Team Team Team Patient Flow Horizontal Structure Attributes Short product life and development cycles Customer satisfaction is a goal Environment can be uncertain, fast changing  Network organization A business structure where employees create small, independent multidisciplinary teams focused on achieving a common objective. This organization model doesn't depend on the standard top-to-the-bottom supervisory system. Instead, executive employees, managers, or team leaders create specific groups to handle tasks and issues as they arise without direct supervision. The teams in this organizational model collaborate to achieve a major organizational goal using an iterative approach.  Network Organization Designers Producers Brokers Suppliers Marketers & Distributors Network Structure Attributes Need to concentrate on core function and can subcontract the rest Can’t afford large start-up costs(full team complement) Fast-paced changing industries, environment is uncertain  Network Organization Good ideas welcomed regardless of their source Cross-functional customer service teams Delegated authority, shared information Team focus, idea generators  Informal Structures The informal structure refers to the natural formations that come easily as people, teams work together Informal leadership and communication patterns that evolve in an organization and run parallel to the formal structure  What Influences Organizational Structure(design) Corporate culture Leadership, People and their shared values Strategy Size of Organization Environment (market) Technology  Environmental characteristics and recommended designs Environmental Rate of Low Uncertainty Moderate Uncertainty Formal, centralized mechanistic Formal, centralized mechanistic Stable structure with few departments structure with many depts. and Change integration roles Moderate Uncertainty High Uncertainty Decentralized, organic structure Decentralized, organic structure; Unstable with participation and teamwork; participation and teamwork; few departments; boundary numerous departments and spanning roles boundary spanners Simple Complex Environmental Complexity  Organizational Design Some things to note High power cultures tend to be structures with centralized decision making. High need(desire) for control There can and will be differences across industries and countries. Organizational structures generally remain the same with nuances, changing a structure requires a great deal of change but can be extremely important for the company to remain current and in business  Summary A definition of organizational structures The difference between Mechanistic and Organic structures Functional structure, Divisional structure, Matrix structure Horizontal structure Network structure Informal structure Environmental characteristics and recommended organizational designs 32