The project organization is temporary-it ceases to be on completion of the project. It is conceived during the project conception stage and comes into existence at the start of planning stage. Gradually, it grows and undergoes changes with the various stages of the project life cycle to meet project needs. Towards the end, it runs down and ceases on completion of the project. It’s special attributes include the innovation capacity to overcome problems as they arise. Usually it is staffed with experienced people to respond speedily to changing situations and to speed up decision making.
Thus the guidelines for designing the project organization will include.
  • Organizational groups are designed to generally conform with the project work-breakdown structure.

  • Each group is assigned responsibilities and allocated resources to meet the assigned tasks.

  • The size and structure of the organization changes with the alternation in requirements. However, the core project team continue till the end.

  • Project groups are suitably structured with emphasis on team work and informal relationship.

  • Organization structure is kept flat to avoid bureaucratic tendencies and to reduce channels of communication with the project manager.

  • Where possible, key staff is derived from their respective parent departments in the corporate office and their interfaces and communication links are clearly defined.

  • The heads of line and staff departments are generally grouped into a project management team and the planning chief is assigned responsibility of the coordination function.

The structuring of work-groups into construction task forces and direct support service centers is accomplished by a applying the three classic principles of designing formal organizations. These principle are outline below.

a.     Unity of command

According to this no man can serve two bosses simultaneously that is, a person should receive orders from and be responsible to only one superior.

b.     Scalar principle

This implies that within an organization, the chain of command or hierarchy showing the superior-subordinate relationship should be well defined, that is, it should clearly lay down the channel of authority, decision-making and communication.

c.      Span of control

This principle puts a limit to the number of subordinates (span of control) reporting to a superior. In other words, an executive should be made accountable for the actions of only a limited number of subordinates. The span of control depends upon many factors such as:

1.     Nature of work.

2.     Project characteristics, including execution times.

3.     Moral and competence of the people.

4.     Capability of the leaders at various levels.

5.     Management policy regarding decentralization, information system and the degree of control.

A limited span leads to strict control but it has adverse implications: the senior leaders tend to interfere with the work of their subordinates, thus restricting their initiative. Further, project organization undergoes changes in various phases of the project lie cycle. Unlike  on-going enterprises, there are on standard methods of organizing the project management. Generally, efficient management of project resources is effected by organizing the project management structure similar to the army’s special purpose task-force concept. The leader of this organization is the project manager. Although management principles of forecasting, planning, organizing, staffing, directing, motivating, monitoring, communicating, controlling and decision making, are equally applicable in the traditional functional type management as well as project management, but the risks, uncertainty and complexity make project management a relatively difficult process.