The document discusses different types of project organizations and their advantages and disadvantages. It describes matrix organization as the most common type where employees report to both a functional manager and project manager. This structure has advantages like resource coordination and allowing employees to develop diverse skills. However, it also has disadvantages like divided loyalties between functional and project managers and potential power imbalances. A pure project organization separates the project completely from the parent organization but lacks technology transfer between functions.

1. Chapter-03
PROJECT SCHEDULING
OutlineSyllabus
Project as part of Organization - Pure Project Organization – Matrix
Organization - Mixed Organization system -Human Factor and Project Team.
3.01 TYPES OF PROJECT ORGANIZATION
A company does not have to choose one method of project organization -- the type chosen may
vary according to the scope of the project and the available resources.
1. Matrix: A matrix organizational structure is a company structure in which the reporting
relationships are set up as a grid, or matrix, rather than in the traditional hierarchy. In other
words, employees have dual reporting relationships - generally to both a functional manager
and a product manager. A matrix arrangement is the most common type of project
organization. The team is comprised of members from different areas of the company
selected based on demonstrated experience in their field. A project manager is charged with
ensuring the group completes the assignment on time, that it does not go over-budget and
meets company standards. Matrix project organization can be a good choice as team members
are experts in their field, but can be a challenge as employees may have conflicting job-
related priorities, which can delay project completion.
2. Self-Directed: A self-directed team has the freedom to make its own decisions on how a
project will be completed. At the beginning of the project, team members receive a goal and
are allowed to determine the best way to achieve it. There is typically no one person in
charge, but one team member usually evolves into a leadership role as the project progresses.
Team members are responsible for recruiting any additional employees they believe would be
a valuable asset to the group and providing feedback on their work.
3. Project-Based: In a project-based team, functional departments are formed within the project
team itself. For example, the project team would have its own marketing, IT and finance
teams, instead of sharing resources with the rest of the department. This type of organization
is typically only used in very large, long-term projects. It can be advantageous, because all
employees are solely dedication to the project, instead of having to split time between other
job-related priorities. It can also an unfavorable idea, because a company may end up with
duplicate resources. For example, if a company has a marketing, IT and finance team solely
dedicated to a project, it will also need to hire another group of people to perform these
functions to meet the remaining business needs.

2. Project Management74
4. Problem Solving: When a company has a problem that can’t be solved through traditional
methods, a it can create a problem-solving team. This type of project team brings
representatives from different areas of the company together to find a solution. Members are
tasked with solving the problem in an efficient manner while working to meet the needs of all
functional areas of the company.
5. Functional: In functional project organization, teams are comprised of workers from the
same functional areas. All the resources needed to complete the project come from one single
department. If a large project requires work from multiple departments, the work is
completed independently by each department. This can make project completion more
efficient, as team members are used to working with one another and are often dedicated
solely to working on the project. It can also cause challenges if help is needed from workers
outside the department, as team members may not know who to contact for specific
information. Functional teams are most effective with routine projects that require little
variation.
3.02 ADVANTAGES OF MATRIX ORGANIZATIONALSYSTEM
In a matrix structure, each employee answers to two immediate supervisors: a functional
supervisor and a project supervisor. The functional supervisor is charged with overseeing
employees in a functional area such as marketing or engineering. Project supervisors manage a
specific and often impermanent project. They absorb employees from various functional areas to
complete their project teams. This kind of organizational structure has several advantages.
1. Resource Coordination: The matrix structure allows supervisors to focus on their areas of
expertise. Functional supervisors focus on hiring, training and managing employees in their
field, while project supervisors can focus on achieving the goals of their specific projects or
products.
2. Specialization: Placing employees in functional areas allows them to specialize in a
particular field. Instead of being good at a variety of tasks, specialized employees can excel at
tasks in their field of focus.
What is meanby matrix organization? BBA (Professional) 2008
Explainin briefdifferentformof project organization. BBA (Prof.) 2011, 2012
What typesof groups may be formedin a projectsetting? BBA (Professional) 2007

3. Chapter3: Project Scheduling 75
3. Breadth of Skill: When isolated in a functional area, employees may have more difficulty
benefiting from the skills and experiences of those in other areas. In a matrix structure,
employees have constant contact with members of other functional areas via their
membership in project teams. Through the project team, employees have the opportunity to
develop a wider set of skills than they would in a purely functional structure.
4. Communication: Since employees have constant contact with members of different
functional areas, the matrix structure allows for information and resources to travel more
fluidly between those functional areas. The collaboration between functional areas allows a
project team to better handle complex challenges and objectives.
5. Flexibility: The matrix structure allows for human resources to be shared flexibly across
different projects or products. Functional areas maintain a stock of talented employees to
meet projects' requirements.
For these reasons matrix organizational structure or system is applicable in Bangladesh for
effective project implementation.
What are the advantages of matrix organization? BBA (Professional) 2008
Which form of organizational system is applicable in Bangladesh for effective
project implementation? BBA (Professional) 2012
3.03 DISADVANTAGES OF MATRIX ORGANIZATION
The matrix structure typically combines the divisional and functional structures, retaining the
advantages of each. Creating this hybrid produces some disadvantages, however.
1. Formation: Companies forming a matrix typically begin with a vertical hierarchy of
permanent departments led by managers from above. The departments contribute one or more
employees to different divisional projects, each project reaching across departments to create
a horizontal team focused on a particular product, customer or region. The combination of
vertically oriented departments and horizontally oriented divisional projects forms a grid.
This matrix makes every employee responsible for both divisional and departmental goals.
These combined responsibilities generates the disadvantages of the matrix organizational
structure.
2. Divided Loyalties: Divisional project managers have staff authority over all project-related
matters, giving these leaders power over employees committed to the project. These
employees remain accountable to their functional managers. The dual chain of command can
easily put employees in an untenable situation when functional and divisional bosses have
different ideas on such things as work style, priorities and procedures. Employees with
divided loyalties might begin to feel pressure to choose one boss over another, skewing the
power dynamic at the workplace
3. Balance of Power: Problems with power imbalances may not only develop because of
employees, but also from the company culture as a whole. Upper management must ensure
that project authority and functional authority are balanced, with each given equal

4. Project Management76
consideration and resources. The imbalance otherwise undercuts the effectiveness of
managers and the matrix structure as a whole.
4. Horizontal Versus Vertical: Problems arise in the matrix structure when divisional missions
are at odds with functional goals, plans and priorities. When horizontal and vertical priorities
diverge, functional and divisional managers may begin to compete for resources and power.
This includes competition for subordinate support. Managers working within the matrix
structure must coordinate and synchronize their plans to avoid conflicts.
5. Meeting Time: Given the potential for conflict caused by the dual command structure, the
matrix demands ample meeting time. This should be scheduled as a regular part of doing
business, a preventative measure that keeps the organization running smoothly. Additionally,
companies adopting the structure must realize going in that the success of such meetings and
the organization itself are dependent on the interpersonal, communication and conflict
resolution skills of employees and management. Companies might need to invest in training
to that end.
3.04 HUMAN ASPECT OF PROJECT MANAGEMENT
For the successful execution of a project, a satisfactory human relation is must without such a
system other systems of project management do not work well. To achieve satisfactory human
relations in (he project setting, the project manager must successfully handle problems and
challenges related to:
1. Authority
2. Orientation
3. Motivation
4. Group functioning
1. Authority: In project management, the project manager whose activities cut across
functional lines of command lacks the desired formal authority. While the manager has
formal control emanating from contracts and agreements, as far as outside agencies involved
in project work are concerned, in his own organization he has to contacted with split
authority, and dual subordination. His effective authority would stem from his ability to
develop rapport with the project personnel, his skill in professional reputation and stature, his
skill in communication and persuasion.
2. Organization: Most of the managers, working for a project are engineers or technologist
when an engineer assumes managerial responsibility, he faces some different type of
problems, which he is supposed to:
- Perform the task of planning, organizing, directing and controlling the resources of the firm
in the world of uncertainty.
- Adopt a more creative approach to solve non programmed and unstructured problems.
What are the disadvantages of matrix organization? BBA (Professional) 2008

5. Chapter3: Project Scheduling 77
- Attach greater importance to efficient utilization of resources and resolution of human
relation problem. Thus, for achieving the task he must himself be an accomplished engineer
turned manager.
3. Motivation: The project manager works within the boundaries of a socio technical system.
The principal behavioral factor, which he can influence, is the motivation of the project
personnel. In order to succeed in motivating project personnel, the project manager must be a
perceptive observer of human beings must have the ability to appreciate the variable needs of
human being, must have a skill in several styles of management suitable to different
situations.
4. Group Functioning; For building an effective group the company must presume a genuinely
participative style of management. With the managerial philosophy the project manager can
facilitate the development of mutual trust and acceptance, open communication, co-operation
and project attitude. In this task the needs leadership capabilities, sensitivity to human nature,
perceptiveness, concern for welfare of others, maturity and impartial approach. Actually this
is difficult and challenging task.
3.05 MATRIX VS. PURE ORGANIZATION
Difference between Matrix Organization and Pure Organization are given below.
Basis Matrix Organization Pure Organization
1. Definition A matrix organizational structure is a
company structure in which the
reporting relationships are set up as a
grid, or matrix, rather than in the
traditional hierarchy.
A pure project organization is a model
of a business where project managers
have total control over the project they
oversee. Central control at the
managerial level must be weak for this
to occur.
2. Characteristic The essential characteristic of this
approach is that it set up as a grid, or
matrix, rather than in the traditional
hierarchy.
The essential characteristic of this
approach is that the project is separated
from the home organization.
3. Nature The matrix organization is balanced
between functional type of the project
management organization and pure
project management organization.
The pure project management
organization is pure in nature.
4. Technology
transfer
New technology transfer is found here
due to strong functional divisions.
Lack of new technology transfer is
found here due to weakened functional
divisions.
5. Authority The project manager has not full
authority over the project.
The project manager has full authority
over the project.
6. Responsibility The project manager is not responsible
for compilation of the project.
The project manager is responsible for
compilation of the project.
7. Lines of Lines of communication are expanded. Lines of communication are shortened.
What are the human aspects ofproject management?BBA (Professional) 2009, 2010

6. Project Management78
communication
8. Organizational
goals
Organizational goals and policies are
not ignored.
Organizational goals and policies are
ignored.
9. Functional area Team members have separate
functional area.
Team members have no functional area.
10. Duplication Duplication of resources is minimized. Duplication of resources is not
minimized.
11. Structure Complex in structure. Simple in structure.
3.06 TYPES OF CONFLICTS PROJECT MANAGER FACED
 Meeting schedule and cost goals without compromising performance appears to be a
technical problem for the project manager.
 Another problem is motivating project team members to accomplish the work of the
project.
 Another behavioral problem for the project manager is interpersonal conflict. The
problem is so pervasive, that conflict between project team members and between team
member and outsiders (including the client) seems to be the natural state of existence for
projects.
3.09 WHY TRADITIONAL ‘FUNCTIONAL’ ORGANIZATION IS
NOT CONSIDERED SUITABLE
 The traditional ‘Functional’ organization is not suitable for implementation of projects in
general because:
 No Single individual is directly responsible for total project. No formal authority.
 It does not provide project-oriented emphasis necessary to accomplish project tasks.
 Needs excessive lead-time for approval of decisions due to complex co-ordination.
 Decisions normally favour strongest functional group.
 There is no customer focus.
 Slow response to customer needs.
 Difficult to pinpoint responsibility.
 Individual motivation and innovation are on low scale.
 A ‘Pure Project’ organization is a separate division developed within the company with
independent authority and responsibility for project. Such organization is suitable for
companies embarking on major diversification / expansion projects generally at sites away
from the parent organization.
 A ‘Matrix Project’ organization combines the attributes of Functional & Pune Project
Organizations. While retaining the basic functional structure, it identifies independent
What are the difference between matrix organization and pure organization?
BBA (Professional) 2010
What types of conflicts a project manager faced?

7. Chapter3: Project Scheduling 79
authority and responsibility for a project with a project manager. Such structure is found
generally suitable for organizations engaged in project implementation for the clients as their
main business. Construction contractors, EPC companies etc. are some examples.
Why the traditional ‘Functional’ organization is not considered suitable for
implementation of projects in general? Name the other organization structures
developed stating the types of projects these are found to be more effective.