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Project Management

Professional

02
Project Management Framework
02 Project Management Framework:
Learning Objectives

By the end of this module, you will be able to:


Understand the organizational framework in which
projects and project management operate.
The topics that will be covered are:
Organizations and their influences on the project management
Enterprise Environmental Factors
Project Stakeholders

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Organization Influence

Since Projects are typically part of an organization that is larger than the
Project, the Project is influenced by a number of aspects of the larger
organizational structure:

Organizational Process Assets


include any or all process related assets, from any or all of the organizations involved
in the Project that can be used to influence the Projects success

Organizational Cultures and Styles


Political, economic, demographic, educational, ethical, ethnic, religious, etc.

Organizational Structure
The structure of the performing organization often constrains the availability of
resources.

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Organization Process
Assets

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Organizational Influences

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Organizational Structure

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Functional Organization

Departments & Department Heads are organized by the functional areas


within the company. Each department is headed by a Functional Manager
This structure is typically used in businesses that primarily sell and
produce standard products. For example, a company that manufactures
and sells video recorders.

Project
Projectmanagers
managersin
inthis
thisorganization
organizationhave
haveno
nopower/control.
power/control.

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Behavioural Differences:
Functional vs. Project Manager

Functional Manager Project Manager

Report up to a single chain Multiple reporting


of command relationships
Hold great deal of authority Have very little real authority
by virture of their titles
Often provide no input into
Provide formal input into employee perfromance
employee performance reviewes
reviews
Are not always on the
Are always on the management compensation
management compensation ladder
ladder
Their position is temporaray
Their position is permanent
Are sometimes paid at a
Are paid at a hiegher level lower level than their
than their subortinates subortinates

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Functional Organization:
Characteristics
Each functional group concentrates on performing its own activities
in support of the companys business mission.
A company with a functional structure may periodically undertake
projects, but these are typically in-house projects rather than
projects for external customers.
A strict chain of command might exist, and the corporate culture
might dictate that you follow it.
Roughly translated:
Dont talk to the big boss without first talking to your boss who talks to
their boss who talks to the big boss

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Project Organization

Projectized organizations are nearly the opposite of functional organizations.


The focus of this type of organization is the project itself. The idea behind a
projectized organization is to develop loyalty to the project, not to a functional
manager.
Companies with this organization are in the projects business; they do not
produce standard products

Functional
Functionalmanagers
managersin
inthis
thisorganization
organizationhave
haveno
nopower/control
power/control

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Project Organization:
Characteristics
A full-time project manager has complete project and administrative
authority over the project team.
Project organization structures are found primarily in companies that
are involved in very large projects, i.e., high (multimillion) dollar value
and long (several years) duration.
Project organization structures are prevalent in the construction and
aerospace industries. They are also used in the non business environment,
such as for volunteer-managed projects.

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Project Organization:
Advantages/Disadvantages
Advantages:
The project team has full control over the resources, including authority
over how the work gets done and by whom.
The project organization is highly responsive to the customer.
Is well positioned to be highly responsive to the project objective and
customer needs because each project team is strictly dedicated to only
one project.
Disadvantages:
Cost-inefficient because of underutilization of resources.
When things are slow, individuals have a tendency to stretch out their work
to fill up the time available
Potential for duplication of activities on several concurrent projects.
There is a low level of knowledge transfer among projects.
Individuals are dedicated to working on one project.
At the end of a project, people may be laid off if there is not a new project
to which they can be assigned leading to team members experiencing Page high12
Matrix Organization
CEO

VP Projects VP Engineering VP Manufacturing VP Marketing

Project Manager1

Project Manager 2

The idea is that the best of both organizational structures can be realized by
combining them into one. The project objectives are fulfilled and good project
management techniques are utilized while still maintaining a hierarchical
structure in the organization.
It provides the project and customer focus of the project structure, but it
retains the functional expertise of the functional structure.

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Matrix Organization:
Characteristics
Employees in a matrix organization report to one functional manager
and to at least one project manager.
Its possible that employees could report to multiple project
managers if they are working on multiple projects at one time.

In
Inaanutshell,
nutshell,functional
functionalmanagers
managersassign
assignemployees
employeesto toprojects,
projects,while
whileproject
project
managers
managersassign
assigntasks
tasksassociated
associatedwith
withthe
theproject
projectininaamatrix
matrixorganization.
organization.

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Matrix Organization:
Balance of Power
A lot of communication and negotiation takes place
between the project manager and the functional manager
This calls for a balance of power between the two, or one will
dominate the other.
There are Three types of matrix organizations that are
formed as result of the power basis between the project
manager and the functional manager:
Strong matrix
Weak matrix
Balanced Matrix

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Strong Matrix Organization

In a strong matrix organization, the balance of power rests with


the project manager.
They have the ability to strong-arm the functional managers into giving
up their best resources for projects.
Sometimes, more resources than necessary are assembled for the
project, and then project managers negotiate these resources
among themselves, cutting out the functional manager altogether

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Weak Matrix Organization

On the other end of the spectrum is the weak matrix


As you would suspect, the functional managers have all the power in this
structure. Project managers are really project coordinators or expeditors
with part-time responsibilities on projects.
Project managers have little to no authority, just as in the functional
organization. On the other hand, the functional managers have a lot of
authority and make all the work assignments.
The project manager simply expedites the project.
Project Expeditor acts primarily as a staff assistant and communications
coordinator. He/she cannot make or enforce decisions, i.e. has no power

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Weak Matrix Organization
CEO

Proj. Coordinator

VP Engineering VP Marketing VP Finance

Staff Staff Staff

Sometimes when there are too many local projects and becomes increasingly
difficult to exe to them, the CEO may use the services of a project manager in
the role of a Project Coordinator.
The Project Coordinator has some power to make decisions, some authority,
and reports to a higher-level manager, possibly the CEO
The Project Coordinator has power over the individual project managers

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Balanced Matrix Organization

A balanced matrix organization is in between the weak matrix and


the strong matrix.
The power is balanced between project managers and functional
managers.
Each manager has responsibility for their parts of the project or
organization, and employees get assigned to projects based on the
needs of the project, not the strength or weakness of the
managers position.

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Comparing Organizational
Structures
Functional Weak Matrix Balance Strong Project
Matrix Matrix
Project Project Project
Managers coordinator, coordinator, Project Manager Project Manager Project Manager
Title: project leader project leader, or
project expeditor

Project Split between Split between


Managers project and project and Projects and Projects and Projects and
Focus: functional functional project work project work project work
responsibilities responsibilities

Project No authority or Minimal authority Balance of Significant Total authority


Managers power and power authority and authority and and power
Power: power power

Project Part-time on Part-time on Full-time on Full-time on Full-time on


Managers projects projects projects projects projects
Time:

Organization Most like Blend of weak Most like a


Style: Functional functional and strong projectized Projectized
matrix organization

Who Controls Functional Functional Shared Project Manager Project Manager


the Budget: Manager Manager

Project Functional Manager of Manager of


Manager Functional Functional Manager but project project
Reports To: Manager Manager shares managers managers
responsibility

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Project Office

Project Office (PO), Project management Office (PMO),


Enterprise Project Management Office (EPMO), etc., is a
formal structure within an organization.
Roles:
Provides the policies, methodologies and templates for managing
projects
Provides support and guidance to project managers on how to
manage projects, training etc.,
Provides project managers for different projects and been
responsible for the results of the projects.
Ingredients for success:
The role of the PMO must be clearly defined
Commitment of senior management is required
PMO will not improve the project performance without also using
proper management processes and techniques.

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Enterprise
Environmental Factors

Page 22
Enterprise Environmental Factors

Refer to both internal and external environmental factors that surround or


influence a Projects success.

23
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Project Stakeholders

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Project Stakeholders:
Discussion
Stakeholder Definition
People that are involved in the project or affected by the project
activities in a negative or positive way. They may also exert influence
over the project and its results.
Stakeholders include:
project manager the person that manages the project
project sponsor the person that provides the financial resources (funding)
project team persons that will be completing work tasks on n the project
support staff persons that support the administration of the project
customers - the person or organization that will use the product of the
project
Users - the end users that will use the product of the project
Others - suppliers, sellers, owners
Adversaries to the project
Points to remember:
Stakeholders can be outside of performing organization
Society, citizens

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Project Stakeholders: Discussion

What if there is a difference/conflict among the


requirements of the various stakeholders? How the
project manager should seek to obtain closure? How
should the closure should be resolved?

In
Inconflict
conflictsituations,
situations, resolve
resolveconflict
conflictininfavor
favorof
ofthe
the
CUSTOMER!
CUSTOMER!

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Question and Answers

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