Project organization
A project organization structure is of a recent origin, having been conceived after World War 2. It is a set up with the object of overcoming the major weaknesses of the functional organization, namely, absence of unity of command, delay in the decision making, and lack of coordination. A project organization is composed of a core of functional departments; through its main units are specific programmes or projects. The organization is designed with the specific objectives in view and there is also a provision is disbanding it after the programme or project has to be established. A project organization somewhat resembles the matrix organization through there is a matrix difference between the two. A project organization is suitable in the case of accomplishment of a small number of large projects while the matrix organization is advisable in case of a large number of small projects have to be accomplished.
Suitability of the project organization:
1. It is one time task and is definable in terms of a single, specific goal.
2. It is infrequent, unique, and unfamiliar to the present organization. Unfamiliarity usually leads to a disagreement as to how the activity should be managed.
3. It is complex and calls for a high degree of interdependence among the tasks.
4. There is a high degree of stake in the successful completion of the project. The time factor is critical because if the project is not completed within the stipulated time, the organization may lose heavily because of fine provision due to delay.
Advantages of the project organization:
1. Project organization allows maximum use of specializes knowledge, which is available to all projects on the equal basis. Knowledge and skills can be transferred from the one project to another project.
2. It enables the organization to adapt to the environmental demands particularly when environmental factors are fast changing.
3. It provides more flexibility for the utilization of resources in the organization by allocating them to the projects where these are needed.
Disadvantages or problems in the project organization:
1. Project organization creates feelings of insecurity and uncertainty among people in the organization. It has an ad hoc arrangement with the limited life. Therefore, a question comes in mind what will happen after the project is over.
2. People are not able to identify themselves with any particular department in the organization because they do not have particular department in the organization because they do not have permanent tenure with any project. Thus, there is less loyalty of people with the organization.
3. There is lack of clarify among the members but there is a role in the organization. For example, project relationships are not based on the principals of clarify of authority and responsibility and fixed amount of authority. Thus, only those persons can work better who have high level of tolerance for ambiguity.
4. Often project manager faces numerous problems because he has to carry responsibility without authority. Therefore, he has to rely on his personal qualities rather than on his official authority. Therefore, if organizational claims are not very congenial there is high chance of his failure.