*Project organisation* and the organisations it suits

Meaning of project organisation

A project organisation is a structure built around finishing one large project, or a small number of large projects. For each project a team of specialists is put together, and that team stands apart from, and independent of, the functional departments. It is one of the contemporary organisational formats, as distinct from the traditional line and line-and-staff forms. G. R. Terry regarded it as the preferred arrangement whenever a well-defined project has to be handled, or a task is larger than anything the organisation normally deals with.

How a project organisation works

• A project manager in charge. Specialists and workers drawn from different functional departments are placed under the leadership, control and coordination of a project manager, who may also seek advice from experts inside and outside the organisation.
• Authority moves with the people. While the project lasts, the functional managers give up their authority over the staff lent to it, in favour of the project manager. Each project manager carries full responsibility and authority for the resources the project needs, and there is a single line of command.
• Built beside the existing structure. The project structure is set up without disturbing the firm's functional structure; a general manager may oversee several independent projects, each with its own teams for production, engineering, accounting and so on.
• Temporary or standing. The size of the team differs from project to project. For a one-time project the set-up is temporary: it is wound up when the work ends and the staff go back to their departments. In many firms, however, it is a permanent feature, and members simply move on to the next project.

Types of organisation for which it is suitable

Project organisation suits a firm when the work has these features:

1. A fixed deadline. The assignment must be completed within a given time frame.
2. Heavy capital outlay. Completing the project needs a very large investment.
3. A one-time, well-specified job. The project is a single assignment with clear specifications, and the firm wants its regular business to carry on undisturbed.
4. Technical work needing precision. The project is technical and has to be executed with the utmost accuracy.

It is therefore used in ship building, construction, aerospace, aircraft manufacturing and satellite launching, where performance standards are high and specialists must work closely side by side. It suits an organisation running a limited number of projects; for many projects at once, the study text treats the matrix structure as the suitable form. An engineering firm building a metro rail corridor in Pune to a contract deadline, or a shipbuilder delivering one patrol vessel to a fixed schedule, would set up a project team of civil, mechanical, finance and procurement staff under one project head, and release them when the work is handed over.

Points to watch

The study text also notes difficulties: staff may fear losing their jobs when a project ends, which makes them anxious about their careers; the project manager's job is hard where responsibilities, communication lines and performance standards are not clearly defined; specialists from many fields bring different approaches and interests, which creates uncertainty; and separate teams may duplicate each other's efforts, which can hurt overall efficiency.

Conclusion

A project organisation places a dedicated, self-contained team under one manager to deliver a defined result. It is the right choice for large, technical, costly and time-bound work, provided the firm handles its people carefully when each project closes.