The modern workplace’s evolving organizational structures reflect the dynamic nature of the IT sector. Projectized organizational structures are gaining popularity due to their emphasis on result-oriented workspaces and adaptability to changing environments. This article explores the characteristics, advantages, and disadvantages of projectized organizations, drawing insights from various sources, including LinkedIn, PM Study Circle, and QuickStart.
Key Facts
- Characteristics of a Projectized Organizational Structure:
- Dynamic and adaptive nature
- Project managers have full authority over project resources, budget, and work assignments
- Full-time team members under the control of project managers
- Collocation of team members for better performance until project completion
- Disbanding of the team and release of resources after project completion
- Advantages of a Projectized Organizational Structure:
- Clear line of authority and faster decision-making
- Effective communication within the team due to a single reporting system
- Quick decision-making by project managers leading to faster project completion
- Improved communication and cooperation within the team, fostering learning and versatility
- Disadvantages of a Projectized Organizational Structure:
- Potential for project managers to become arrogant due to absolute authority
- Stressful work environment due to tight schedules and deadlines
- Sense of insecurity among team members regarding job stability after project completion
- Higher cost of hiring employees and equipment for shorter periods
- Potential impact on the quality of project deliverables due to team members’ lack of specialization
Characteristics of a Projectized Organizational Structure
Projectized organizations are characterized by their dynamic and adaptive nature, which allows them to thrive in rapidly changing environments. Project managers hold full authority over project resources, budgets, and work assignments, enabling them to make quick decisions and ensure project success. Full-time team members under the control of project managers work collaboratively until project completion, often collocated to enhance communication and performance. Upon project completion, the team disbands, and resources are released, allowing for the efficient allocation of resources to new projects.
Advantages of a Projectized Organizational Structure
Projectized organizations offer several advantages that contribute to their effectiveness. The clear line of authority and faster decision-making processes streamline communication and expedite project completion. Effective communication within the team is facilitated by a single reporting system, fostering a sense of accountability and responsibility. Project managers’ ability to make quick decisions enables them to address challenges promptly, leading to faster project completion. Moreover, the sense of urgency within the team promotes improved communication, cooperation, and a willingness to learn and adapt, resulting in increased versatility among team members.
Disadvantages of a Projectized Organizational Structure
Despite their advantages, projectized organizations also face certain challenges. The concentration of authority in the hands of project managers can lead to arrogance and potential conflicts within the team. The demanding nature of projects, with tight schedules and deadlines, can create a stressful work environment. Team members may experience a sense of insecurity regarding their job stability after project completion, which can affect their loyalty to the organization. Additionally, the cost of hiring employees and equipment for shorter periods can be higher compared to traditional organizational structures. Furthermore, the lack of specialization among team members due to their involvement in diverse projects may impact the quality of project deliverables.
Conclusion
Projectized organizational structures have gained prominence in the modern workplace due to their adaptability, clear lines of authority, and emphasis on result-oriented workspaces. While they offer advantages such as faster decision-making, effective communication, and team versatility, they also present challenges related to potential arrogance among project managers, job insecurity, and higher costs associated with short-term hiring. Organizations considering the adoption of a projectized structure should carefully evaluate these factors to determine its suitability for their specific needs and goals.
References
- Ali, R. (2019, September 12). A Projectized Organizational Structure is the trend to be followed? I DO! LinkedIn. https://www.linkedin.com/pulse/projectized-organizational-structure-trend-followed-i-rameez-ali
- Usmani, F. (2022, August 15). What is a Projectized Organization Structure? PM Study Circle. https://pmstudycircle.com/what-is-a-projectized-organization-structure/
- Sajid, A. (2018, March 2). Everything You Need to Know About Projectized Organizations. QuickStart. https://www.quickstart.com/business-productivity/everything-you-need-to-know-about-projectized-organizations/
FAQs
What is a projectized organizational structure?
A projectized organizational structure is one in which activities are managed through projects. Project managers have full authority over project resources, budgets, and work assignments. Teams are typically collocated and disbanded upon project completion.
What are the advantages of a projectized organizational structure?
Advantages of a projectized organizational structure include clear lines of authority, faster decision-making, effective communication within the team, quick decision-making by project managers, and improved communication and cooperation within the team.
What are the disadvantages of a projectized organizational structure?
Disadvantages of a projectized organizational structure include the potential for project managers to become arrogant, a stressful work environment due to tight schedules and deadlines, a sense of insecurity among team members regarding job stability after project completion, higher costs associated with hiring employees and equipment for shorter periods, and potential impact on the quality of project deliverables due to team members’ lack of specialization.
What types of organizations are suited for a projectized organizational structure?
Projectized organizational structures are well-suited for organizations that operate on a project basis, such as construction companies, IT consulting firms, and event planning companies. They are also suitable for organizations that need to be adaptable and responsive to changing market conditions.
How does a projectized organizational structure differ from a functional organizational structure?
In a functional organizational structure, employees are grouped by their functional area, such as marketing, finance, or operations. In a projectized organizational structure, employees are assigned to projects and report to the project manager.
What are some best practices for managing a projectized organization?
Best practices for managing a projectized organization include defining clear project goals and objectives, establishing a strong project management methodology, empowering project managers, fostering a collaborative work environment, and providing ongoing training and support to project managers and team members.
What are some common challenges faced by projectized organizations?
Common challenges faced by projectized organizations include managing multiple projects simultaneously, dealing with resource constraints, coordinating work across different teams, and ensuring that projects are completed on time and within budget.
What are the key skills that project managers in projectized organizations need?
Key skills that project managers in projectized organizations need include leadership, communication, problem-solving, decision-making, and risk management skills. They also need to be proficient in project management methodologies and tools.