Project structure - Sociology of organizations

Project Structure

The development of divisional structures, their transformation into holdings and other modern management structures marked one of the main directions in the reorganization of companies in the late XX century. Another direction was associated with the development and wide use of project structures.

Such structures have always existed in a number of industries, primarily in construction. Their advantages were absolute adaptability. A design structure can be defined as a "structure without a structure". For each project launched by the company, a special unit is created within it; with the completion of the project, the unit is disbanded and a new one is created, created for the new project (Figure 4.5).

The project structure works well when it comes to large-scale and rather unique economic endeavors. Building a house, creating a new technology, servicing a large customer who initiated a special individual order, such economic activities will be adequate to the design structure.

Project Organizational Structure

Fig. 4.5. Project Organizational Structure

With the development of high technology and services, the design structure begins to play an increasingly important role. Individualization of customer orders determines the importance of building similar structures, even in those industries that previously gravitated toward mass production and, accordingly, determined the introduction of other types of structures. In general, the consumer society and the post-industrial society that followed it create in the economy something similar to a biological symbiosis - the mutually beneficial existence of stream production and design organizations. A typical example is large automobile manufacturing plants and small tuning companies.

Rapid development of management and other consulting since the 1980s. also determined the significance of project structures in the modern economy. A consulting, legal or audit firm is by definition a design organization. The work of consultants with individual clients always takes place on a project basis. Individual working groups are created to serve clients, upon completion of work with which they can be reorganized in accordance with new orders. The similarity of orders in this case does not in any way imply a transition to any other structure, since the technology of working with clients implies the consideration of their wishes and individual, often confidential communication. Similarly, the standard construction does not cancel the principled orientation of construction companies on the project structure.

The merits of this structure include:

• Highest adaptability;

• the opportunity to educate the universal employees within the company.

The latter advantage requires some clarification. Constantly reorganizing working groups within the project organization, the leadership creates the conditions for people to master new professions, receive new tasks, and constantly improve themselves. For example, in a large consulting firm that provides management, financial and legal services, a person who originally specialized in one of these areas, constantly communicating with colleagues - both in a formal and informal way - gradually forms his ideas about other areas of activity . Consultant-manager, constantly working with lawyers to serve the same corporate clients, from conversations with them and supervision over their work receives the necessary knowledge on drafting constituent documents and writing internal instructions. The same thing happens with lawyers who begin to understand the technology of building new organizational structures and introducing modern models of employee motivation. Thus, after a certain time in the project organization, people cease to be narrow specialists only on specific business issues. They can, if necessary, replace each other, together discuss the problems that arise.

The lack of design structures alone is a narrow sphere of application. Despite the apparent expansion in recent years of the number of industries where firms with project structures operate, it is impossible to imagine that they generally supersede linear-functional or divisional ones. Repeatability of actions in most industries makes application of the project structure absolutely ineffective. One can not imagine a machine building plant with a project structure or a railway enterprise that would act in relation to each served train as a new project. Therefore, in its pure form, design structures are used in a predetermined number of industries or divisions of companies.

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