Advantages and Disadvantages of Divisional Organizational Management Structures
| Dignity | Flaws |
| 1. A greater degree of independence of management personnel increases the degree of their responsibility for production. 2. A wider range of knowledge of management personnel. Good conditions for training senior managers. 3. Closer connection of production with consumers, accelerated response to changes in the external environment. 4. Improving the coordination of work in departments due to subordination to one person. 5. The emergence of units competitive advantages small firms. | 1. There may be duplication of activities. This happens due to weak communication between departments. 2. Insufficient communication between specialists from different departments. 3. Weak ties with the parent company, as a result of which it often cannot control the activities of its divisional units. The losses from this can be very large. |
Organic organizational structures management. They are characterized by the absence of bureaucratic regulation of the activities of management bodies, the absence of a detailed division of labor by type of work, the blurring of management levels and a small number of them, the flexibility of the management structure, the decentralization of decision-making, and the individual responsibility of each employee for the overall performance.
The types of organic management structures include design, matrix, program-target, problem-target, structures based on a group approach (command, problem-group, brigade), network structures.
Design structures- these are structures for managing complex activities, which, due to their critical importance for the organization, require continuous coordinating and integrating impact with severe restrictions on costs, timing and quality of work. Such structures are temporary, created to solve a specific complex task (project development and implementation). The most qualified employees are gathered in one team different specialties... It is supposed to provide centralized management of the entire course of work on the project. The advantages and disadvantages of the design structure are presented in Table 1.8.
Table 1.8
| Dignity | Flaws |
| 1. Integration different types activities of the company in order to obtain high quality results for a specific project. 2. A complex approach to the implementation of the project, the solution of the problem. 3. Concentration of all efforts on solving one problem, on the implementation of one specific project. 4. Greater flexibility in design structures. 5. Intensification of the activities of project managers and executors as a result of the formation of project teams. 6. Strengthening the personal responsibility of a particular leader both for the project as a whole and for its elements. | 1. In the presence of several organizational projects or programs, project structures lead to the fragmentation of resources and significantly complicate the maintenance and development of the production, scientific and technical potential of the company as a whole. 2. The project manager is required not only to manage all stages life cycle project, but also taking into account the place of the project in the network of projects of the given company. 3. Formation of project teams, which are not sustainable entities, deprives employees of the awareness of their place in the company. 4. When using the project structure, difficulties arise with the prospective use of specialists in a given company. 5. There is a partial duplication of functions. |
Matrix structure recognized as one of the most complex structures of adaptive management. It was originally developed in the space industry, applied in the electronics industry and in the areas high tech. The matrix structure emerged as a response to the need for rapid technological change while making the most of a highly skilled workforce. It is a modern effective type of organizational management structure, built on the principle of double subordination of performers, on the one hand, to the immediate head of the functional service, which provides personnel and technical assistance, on the other, to the project manager ( target program), which is empowered with the necessary authority to implement the management process in accordance with planned timing, resources and quality (Figure 1.6). The project manager interacts with two groups of subordinates: with permanent members of the project team and with other employees functional departments who obey him temporarily and on a limited range of issues. He of the project is responsible for the integration of all activities for a given project, for the project strategy and for the results of the work. Financial resources are transferred to his disposal.
Organization managementRice. 1.6. Product-oriented matrix structure
Moving to a matrix structure usually spans part of the organization, with success depending on how well project managers have professional qualities managers. The creation of a structure is advisable when there is a need to master a number of new complex products in a short time. It is mainly used in knowledge-intensive industries. The advantages and disadvantages of the matrix structure are shown in Table 1.9.
The model of the organization of the activity of an enterprise or institution largely determines the type of organizational structure of management in a given enterprise. There are several basic options that are used in most organizations, either in combination with each other, or in different versions adapted to the culture of the organization and the requirements of the project.
The structure of an enterprise affects the structure of project management, which are implemented on its basis. The main organizational structures include: functional, matrix, project.
Functional structure
The classical functional organization (Fig. 4.1) is a hierarchy in which one superior leader is clearly defined for each of its members.
At the same time, the personnel are grouped by specialties: production, design developments, accounting, sales, marketing. The functional structure is focused on enterprises for which the main type of activity is production, i.e. aims to create a standard product or service. He formulates an answer, which then travels back through the hierarchy. Thus, the process takes a lot of time and requires the efforts of the more people, the more levels of the hierarchy need to be overcome. That is, one of the most significant drawbacks of a purely functional structure is the difficult interaction between functional units.
Project structure
Initially, this organizational form was considered as a temporary structural formation and was applied within the framework of existing functional structures. However, over time, a special organizational mechanism developed, which made it possible to single out this the new kind organizational structure. In the project structure, certain functions (for example, accounting, marketing, strategic planning etc.) are transferred to the highest level of control. The corresponding functional units are also preserved, but their role is changing significantly. Now their purpose is to provide projects with the necessary services. All other tasks are solved at the level of individual project management.
Project structure (especially when implementing major projects) is actually a branch of a company within an enterprise with its own functional divisions or is a separate enterprise created specifically for the project. The members of the project team are fully focused on the results of the project and its leader. This structure is most effective when there is big projects with a life cycle of more than 2 years (Fig. 4.2).
The project structure is focused on enterprises for which the main type of activity is represented by project activity, i.e. aimed at creating a new, atypical product or service. The project structure (especially in the implementation of large projects) is actually a branch of the company within the enterprise with its own functional divisions, or it is a separate enterprise created specifically for the project. The members of the project team are fully focused on the results of the project and its leader.
Both of these structures have their own advantages and disadvantages, therefore, in practice, each of them in its pure form is rarely used. It is caused by and objective reasons, since there are no enterprises in which production or design activities are present in a refined form. Usually some combination of them is used: for example, a project-oriented structure is superimposed on the functional structure, as a result of which an organizational matrix or matrix structure appears.
Matrix structure
The matrix structure is a combination of functional and design approaches. There are several types of matrix structures. The difference between them lies in the relationship between functional and design management principles. Depending on the predominance of the functional or design component of the enterprise, matrix structures are divided into simplified, balanced and reinforced.
A simplified matrix structure is closest to a functional organization, a strengthened one - to a project-oriented one. Balanced takes an intermediate position.
The project manager can get as many people from the functional departments as he needs to carry out work in this period... After the completion of the work, the participants return to their departments and, which is important, there is no need to look for work.
The interaction of project managers with functional units occurs horizontally. These horizontal connections are superimposed on the vertical leadership-subordination relationship and form the interaction matrix.
The main disadvantage of the matrix structure is the violation of the principle of one-man management in the organization. Project team members sometimes struggle to decide who they report to in the first place - their line manager or project manager. The duality of the position of the participants and the dual power often give rise to conflicts within the firm on such important issues as the allocation of specialists and the allocation of resources.
A typical consequence of this lack of matrix structures is the allocation of resources to project activities on the residual principle: the actual priority of functional activities at such enterprises is higher than the priority. project activities.
To minimize these negative properties of the matrix structure, special methods and technologies are used. On the other hand, when forming a project team, the project manager must have a good knowledge of the organizational structure of the enterprise carrying out the project. He must navigate functional distribution staffing table enterprises, functional distribution between departments, the ratio of subordination and subordination of the enterprise's human resources available to form the project team.
Simplified matrix structure
In this version of the organization (Fig. 4.3), all the features of the functional system are preserved. In this case, the role of the project manager is assigned to one of the employees and is reduced only to dispatching functions. Power is concentrated in the hands of functional managers.
Balanced matrix structure
In this approach, a project manager is appointed from among the employees of one of the functional departments. Remaining in his department, this person spends almost all of his time only on project management. At the same time, he is delegated some powers to manage the personnel involved in the project from other departments.
Reinforced matrix structure
The project managers department is added to the existing functional units. The employees of this department are exclusively engaged in the management of the projects entrusted to them and have no other functional responsibilities... Moreover, the project manager has significant powers in the allocation of resources.
In different organizational structures, the workload of personnel in project activities varies significantly. In general, all structures have their own advantages and disadvantages (Table 4.4), therefore, in practice, each of the above structures in their pure form is rarely used. Some of their combinations are more common, which makes it possible to smooth out the shortcomings characteristic of each of the components. For example, to complete a critical project in a functional company, it is quite possible to create a separate team. This team can carry all the features of a project-oriented approach, including the secondment of full-time specialists from functional units, giving the project manager full authority, including financial authority within the project budget. Such a project may have its own management and reporting procedures that differ from those of the company as a whole. In addition, in some cases, a separate subdivision can be formed to provide one or several projects with a number of services - the project support service. In the English language literature, the term Project Support Office is used to refer to it. This department provides services such as scheduling time and resources, monitoring progress, distributing / collecting any other project information, etc.
Table 12.1 - Advantages and Disadvantages of Different Organizational Structures
Other organizational structures
Let us briefly consider some of them, which are not built on the principle of the ratio of the shares of the design and production components in the activities of the enterprise.
A process-oriented organizational structure is formed with a focus on the main business process of the enterprise. The use of such structures can significantly increase the efficiency of personnel and the enterprise as a whole.
Networked organizational structure - a group of enterprising people come together to conclude complex deals by signing contracts with industrial companies, transport agencies, trade and intermediary firms, enterprises retail that are networked.
Even accounting and payroll can be done on a contract basis. All the functions of a traditional company begin to be performed at any time on a contract basis - a sequential chain of supply orders and the development of relationships with other firms. Employees have no subordinates - they have a set of contracts. Network structure advantages: minimal overhead costs; just replace suppliers; there are no problems with motivating employees; the possibilities of the project are rather limited by the imagination of the personnel of the network companies, and not by technical or production facilities.
Restrictions: suppliers can sell products in the same market or work with competitors; the supplier may at any time lose their production capabilities; the quality and other aspects of the product cannot be directly controlled; there is no research base of its own - there is no opportunity to create new types of products.
The divisional structure, as a rule, is applied at large diversified industrial enterprises and / or with a significant territorial remoteness of the company's divisions from the headquarters and from each other. In this case, a division can also mean a branch (department) joint stock company, and subsidiary, and / or a strategic business unit, and a "profit center" and a "cost center". Divisions in large companies a certain independence is granted - they are transferred to the staff functions and the corresponding powers, they are assigned responsibility for the development, production and marketing of products. They get the right to manage both the costs of carrying out their main activities, and a part of the income / profit. The divisional structure includes, in various combinations, project management elements from the three basic types of organizational structures discussed above.
This structure is built on the principle that takes into account the orientation towards a specific project, which means purposeful changes in the system - for example, the creation and production of a new product, the use of new technologies, the construction of facilities. In this case, the activity of an enterprise is considered as a set of projects, each of which has a fixed beginning and end. That is, it is a temporary structure (Fig. 9).
For each project, labor, financial and material resources are allocated, which are managed by the project manager. Each project has its own structure and project management, including the definition of its goals, the formation of the structure and planning of work, organization of work, coordination of the actions of performers. The project manager is vested with project authority and is fully accountable for the team's performance and the efficient use of allocated resources.
After the project is completed, its structure is disbanded, its components, including employees, are transferred to new project or leave, therefore, it is advisable to form such structures for the implementation of projects designed for a long period - at least one or two years.
Rice. 9 - Design OSU
Advantages of a design OSU:
· Flexibility, simple and economical structure;
· The number of personnel management apparatus has been reduced in comparison with the hierarchical structure;
· Has the potential for multidisciplinary activities;
· high degree moral and material interest of the personnel working on the project.
Disadvantages of the design OSU:
High requirements for qualifications, personal and business qualities project manager - he must not only manage all stages of the project life cycle, but also take into account his place in the company's project network;
· Splitting of resources between projects;
· Complex interaction of a large number of company projects;
· Separation of employees of functional departments from colleagues (degradation of knowledge);
· Duplication of work of services already existing in the company (can be eliminated through combination of jobs).
Matrix (or design-matrix) OSU based on the principles of consolidating dual subordination. This management structure is the most complex of all available in practice. The matrix structure can be viewed as a modification of the design structure.
The fundamental difference lies in the approach to the formation of the group, the nature of its interaction with the divisions of the organization.
Technology of transition to a matrix approach in organization management:
1. Creation of temporary target groups by product, project or territory, formed from representatives of different parts of the organization. Despite the fact that the representatives of the target groups formally remain with the department and / or unit that recommended them, at the same time, they should report directly to the leader of the target group.
2. Determination of the status of permanent divisions in the organization for specially created groups. Despite this status, representatives of target groups represent the interests of the departments and services that sent them. The personnel of the departments involved in the work on the project continues to work in parallel on solving the problems of their department.
3. Appointment of a formal leader responsible for the integration of all work in the group. This leader coordinates business relationship with the heads of the functional and product parts of his work.
In these structures vertically shows the management of structural divisions of the organization, horizontally - management of individual programs and projects (for example, when organizing research and development), for the implementation of which specialists and resources from various departments of the organization are temporarily involved.
The matrix structure provides for more information and decisions taken than in previous organizational systems.
A distinctive feature of the matrix approach is the formal presence of an employee simultaneously with two bosses with equal rights. This system of double subordination is based on a combination of two principles - functional and product.
Functional(or technical, horizontal) part of the matrix is responsible for providing work with specifications, technical guidance, qualified personnel and its development.
Grocery(or administrative, vertical) part of the matrix is responsible for planning work, managing and evaluating results, performing work operations, achieving goals.
The combination of the two aims to maintain a balance between technical (how well the work is done) and administrative (how much work is done and how much it cost) goals. The effective interweaving of vertical (administrative part) and horizontal (technical part) connections and communications provides the required balance.
Each relationship matrix includes three types of organizational roles:
§ a chief executive who maintains a balance in the dual reporting system;
§ heads of functional and product divisions, “dividing” the subordinate in the matrix cell among themselves;
§ managers of matrix cells, reporting equally to both the functional and the product manager.
Specialists in functional departments are assigned on a formal basis to a specific product and therefore must report to two managers.
Effectively maintaining these roles at the proper level places very high demands on staff in all respects.
Matrix structure advantages:
· Release of top management from solving operational problems;
· Increasing the efficiency of the use of personnel;
· Flexibility of the organizational structure, the possibility of rapid restructuring and increasing the competitiveness of the enterprise;
· Increasing competence in decision-making at various levels.
Disadvantages of using matrix structures:
· Dualism of management;
The possibility of occurrence conflict situations in temporary groups;
· Additional time spent on various kinds of coordination between management.
The main goal of creating the organizational structure of the PM is to coordinate the interaction between the project participants in terms of tasks, processes and responsibilities. The organizational structure is the most important mechanism for project management, the basis for the formation and implementation of the PM team.
The organizational structure of project management reflects the composition of the elements of the management system and the relationship between them. As such elements are official and structural units, between which there are either vertical (administrative-functional) links that provide administrative decision-making processes, or horizontal (technological) links, which are responsible for the processes of performing work.
According to the RMVOK, the following structures are distinguished:
1.Linear-functional- project management is carried out by the curator through the functional heads of the departments involved in the project.
Advantages:
Stimulates professional specialization;
Improves coordination and resource utilization in functional areas;
Promotes improved manufacturability of performing operations by function.
Flaws:
Stimulates functional isolation;
Increases the number of cross-functional conflicts;
Decreased communication efficiency;
Functional manufacturability is not conducive to solving complex problems.
2.Project Is a temporary structure created for the development and implementation of a project. Its meaning lies in the formation of a project team from different specialists. The team should include persons who are the functional leaders of the project, responsible for him in each of the functional areas.
Advantages:
The project has a holistic, horizontal, targeted focus;
Direct subordination of employees to the project manager, reducing communication links from employees to the project manager and from him to senior management;
Unity in making decisions and giving back to teams;
Simplicity and flexibility in project management.
Flaws:
Duplication of functional areas and reduced resource efficiency;
Reduced manufacturability in functional areas;
Inconsistency in the implementation of organizational procedures and operating principles.
3.Matrix- reflects anchoring in organizational structure the company has two directions of management: vertical (by functional divisions) and horizontal (by individual projects with the involvement of employees from other departments). Depending on the powers of the project manager, a distinction is made between weak and strong matrices. In the case of a weak matrix, management of team members is carried out not directly, but through functional leaders. Occurs when a design organization carries out many small but non-routine projects. A strong matrix requires a project manager empowered to directly issue orders and require accountability from the functional units that are part of the project management team. The use of matrix structures makes high demands on the level of managerial knowledge and skills, since it is extremely difficult to manage.
Advantages:
The project and its objectives are at the center of attention;
Effective use resources for the needs of several projects;
The ability to flexibly "customize" the organizational structure: from a weak matrix to a strong one.
Flaws:
Possibility of conflicts between design and functional structures;
The need to coordinate the activities of several projects;
The problem of the distribution of powers between project managers and heads of functional departments.
4.Mixed (hybrid)- combines the above structures, characterizing
is called flexibility, quick response to changes. Used for the implementation of an internal stand-alone project or for the gradual "growing" of the project.
Organizational chart reflects the influence of the system of interaction of project participants on the project management system. Experts distinguish the following organizational structure schemes: "dedicated" organizational structure; "Project management"; “Overall project management”; "Dual" organizational structure; "Complex" organizational structures.
A "dedicated" organizational structure, or adhocratic (from the Latin ad hoc "on occasion") is created exclusively for one project within the parent organization (general contractor, customer and investor in one person), after which it is liquidated. “Spin-off” means the creation of an independent enterprise, controlled only at the highest level, or a structural unit within the parent organization. Functional or design structures are appropriate for this scheme.
“Project Management” is a permanent project structure within an organization that regularly implements one or several projects. For this scheme, matrix structures are appropriate.
"Universal project management" is formed in the conditions when the activities of the parent organization entirely consist of project management activities, they constitute a single whole, while the resources are shared and shared. For this scheme, matrix and design structures are appropriate.
A "dual" organizational structure for project management occurs when two equal organizations participate in a project and form a joint project management committee. It is applicable in cases where:
The customer of the project and the general contractor are equally important in making decisions on project management;
There are two equal investors or project initiators who are actively involved in the implementation of the project.
For a closer integration of the activities of 2 project participants, you can use both matrix and project structures or mixed structures.
"Complex" organizational structures are formed in the case of participation in the project of more than two organizations, implemented by different, but significant functions in this project. They have the following varieties:
Project management is implemented by the customer, while the organizational structure of the project is formed by the customer, as a rule, functional;
Project management is carried out by the general contractor, to whom the customer transfers the project management functions, retaining the function of monitoring results and creating, as a rule, a matrix organizational structure for project management;
Project management is carried out by a specialized management company, which is entrusted by the customer with project management functions. The management company implements management, does not perform any work on the project, transferring them to the general contractor, who can involve in the implementation individual works subcontractors. For this scheme, it is advisable to use a matrix or project management structure for the project.
The design-target structure arises when all the activities of the organization are concentrated on the implementation of a specific project (or program as a set of projects), the achievement of a specific goal. At the same time, all other structural formations are either absent or are of auxiliary importance - staff and service units, committees, etc.
Project structures usually have a clear boundary with the "parent" organization and interact with it at the highest level, or operate independently of the structures of the project participants.
Divisional structures
Various divisional structures that organize activities not according to the principle of the functional division of labor, but concentrate in the direction of achieving certain goals in a geographic region, in a separate market sector, or differentiate their internal activities towards a specific type of customer or creation and / or promotion certain types goods. At the same time, they push back functional principle organizations are relegated to the background and do not turn into a matrix structure.
In addition to the above "clean" organizational structures, some application in project management is found in the so-called. "Mixed" or "hybrid" structures. They combine different types of substructures.
Functional and design organizational structures can coexist with others. Such an organizational structure is possible in the case of an internal autonomous project. Some firms use it to gradually "grow" a project. At the time of initiation, the project is a small group of specialists united in a team. As the project matures, departments and employees are added to its organizational structure. Further, as the project "dies", the remaining unused subdivisions and individual employees are removed from it.
The effectiveness of the use of a particular organizational structure depends on the content of the project as follows. A project is a set of goals, objectives and results.
Its content does not always require exclusively horizontal integration. Very often it has a functional structure: for example, if the result of a project is the creation of more than one object, but a large number (batch, series) of the same type of goods or services. Although for such a production it is preferable to use a functional form of organization, in view of the cyclical nature of the emergence and collapse of such industries, each of them is precisely the projects for the creation and development of new types of goods.
