Organization Structure Key to Project Management Success

By Londy Bracale, CTU Adjunct Faculty

According to an Anderson Economic Group study, an average of 1.2 million project management positions will need filling annually through 20161. Despite these predictions, project management is still an emerging discipline – one that many organizations have yet to fully embrace.

Research by the Project Management Institute (PMI) suggests the organizational practice adds both tangible and intangible value. It is believed to foster an environment that enhances innovation, supports corporate objectives, drives competitive advantage, attracts employees and improves human resources and organizational structure. Further, PMI suggests that despite how mature an organization is, businesses suffer when emphasis and investment in project management is reduced. As is the case at businesses that have resisted the discipline, this translates into projects that lack attention to detail, fall short on delivery, run over budget, and, overall, fail to meet requirements.

Organizational structure plays a significant role in the acceptance of project management and how successfully it is deployed. Consider three structures common to American businesses and how their experience with the discipline typically unfolds:

Traditional hierarchy. The "siloed" structures that characterize the majority of large enterprises are being criticized as barriers to teamwork, efficiency and innovation – all reasons why project management often underperforms in this environment. In this scenario, projects have little influence in decision-making; so the project management practice needs to be sold to management to gain potential benefits.

Matrix. In this structure, authority is divided by function and by project; with each employee answering to two immediate supervisors: a functional supervisor and a project supervisor. Because of this dual influence in decision-making, it is difficult to gain a solid commitment and challenges emerge from sharing resources. Once committed, however, the project manager maintains control over the project and resources.

Project-driven. In this setup, the organization has full control over the project, and committed participants work directly for the project manager. This increases morale and flexibility, and results in projects that are detail-oriented, and meet expectations and budgets. One downside is the tendency to retain personnel on a project beyond their allotted time. Plus, specialists still require top-level coordination.

In recent years, project management has evolved from being a management philosophy to an enterprise-wide system practiced in all functional units – serving a key business purpose. As a result, the role has taken off and created a demand for specialized education. Now, effective project management is considered essential for organizations that intend to thrive in a quickly-changing world. It’s only a matter of time until the laggards catch up.

Share your thoughts and questions with our PMI-certified faculty on Twitter @CTUBusiness, or leave a comment below.

Londy Bracale is an adjunct instructor at Colorado Technical University. He also works in the private sector as a federal business development manager with a Fortune 500 corporation. He holds his BS in marketing and his MS in management with an emphasis on project management.

1 Project Management Institute, Career Employment Outlook, available at: http://www.pmi.org/professional-development/career-employment-outlook.aspx (accessed: June 26, 2012).

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