6th Edition PMBOK® Guide–Organizational Structures (2)


I am starting a project of going through the 6th Edition of the PMBOK® Guide and blogging about its contents.    The 6th Edition was released on September 22nd by the Project Management Institute, and the second chapter is a general introduction to the framework in which project management exists.

There are many types of entities which can influence a project:

  • Risks–events which can influence a project (covered by Risk Management)
  • Shareholders–people who can influence a project (covered by Shareholder Management)
  • Environmental Enterprise Factors (EEFs)–conditions not under control of the project team that can be either internal and/or external to the organization
  • Organizational Process Assets (OPAs)–company policies and/or knowledge bases accumulated from previous projects

The final type or entity that can influence a project is the form of the organizational structure.   In the chart on page 47 of the Guide, there are 10 different types of organizational structure listed, each of which can influence the following on a project:

  • project manager’s authority
  • project manager’s role
  • availability of resources
  • management of the project budget
  • administrative staff on the project (the project management team)

Although the table is certainly thorough, it’s a bit overwhelming in the amount of information it presents, so let’s go through the choice of organizational structure based on three different variables:

  • Operations vs. projects (functional, strong matrix, balanced matrix, weak matrix, project-oriented, PMO, composite)
  • Complexity (simple, multi-divisional, virtual)
  • Framework (hybrid)

I’m doing three posts, each covering one of these variables.  In this post, I am covering the second variable, that of the complexity of the project.

Organic or Simple

This is a simple project, done by a small team of people working side-by-side.  The person who “owns” the project, the project sponsor, is the one who controls the budget.

Multi-divisional

In this project, the scope is larger and therefore it involves people from different parts of the same organization, although they are usually still co-located, meaning working in the same building.    In this case it is the functional manager who is the one who probably manages the project budget.

Virtual

This is a larger project done by an organization that has several different branches, and the meetings are not in person, but virtual meetings to accommodate the fact that the team members are scattered throughout the organization that is itself in different locations.   The budgets authority will usually be shared by functional managers in the various branches.

The biggest change with this variable is not with the project authority, as the complexity of the communications involved.   This is especially true if some of the locations of the company branches are overseas; then cultural awareness must be one of the other skills that the project manager must learn in order to lead an effective team.

The next post deals with the final variable of the organizational structure, that of a company that prefers traditional, agile, or hybrid project management frameworks.

 

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6th Edition PMBOK® Guide–Organizational Structures (1)


I am starting a project of going through the 6th Edition of the PMBOK® Guide and blogging about its contents.    The 6th Edition was released on September 22nd by the Project Management Institute, and the second chapter is a general introduction to the framework in which project management exists.

There are many types of entities which can influence a project:

  • Risks–events which can influence a project (covered by Risk Management)
  • Shareholders–people who can influence a project (covered by Shareholder Management)
  • Environmental Enterprise Factors (EEFs)–conditions not under control of the project team that can be either internal and/or external to the organization
  • Organizational Process Assets (OPAs)–company policies and/or knowledge bases accumulated from previous projects

The final type or entity that can influence a project is the form of the organizational structure.   In the chart on page 47 of the Guide, there are 10 different types of organizational structure listed, each of which can influence the following on a project:

 

  • project manager’s authority
  • project manager’s role
  • availability of resources
  • management of the project budget
  • administrative staff on the project (the project management team)

Although the table is certainly thorough, it’s a bit overwhelming in the amount of information it presents, so let’s go through the choice of organizational structure based on three different variables:

  • Operations vs. projects (functional, strong matrix, balanced matrix, weak matrix, project-oriented, PMO, composite)
  • Complexity (simple, multi-divisional, virtual)
  • Framework (hybrid)

I’m doing three posts, each covering one of these variables.  In this post, I am covering the variable of operations vs. projects.

Functional organizations

Let’s say a company is doing operations, the regular activities it engages in order to stay in business.   Typically, these activities will be divided into functions, such as accounting, human resources, sales, etc.   If this company wants to do a project, then it needs to take people away from their regular operations work have the people work on the project on a part-time basis.    If the project requires people from various departments, those functional managers will have to give their permission, since it will take people from their regular work during part of each business day for the duration of the project.   In this case, the person who coordinates the project can’t even be said to be a project manager, but rather a project coordinator or expediter.   The resources in terms of money and people for the project will all have to come from functional managers, who essentially all most or all of the authority over a project.   A project coordinator has some limited authority, a project expediter has no decision-making power, and is essentially carrying out the directives given to him or her by the functional manager running the project.

Project-oriented organizations

Let’s go to the opposite extreme and have a company that does mostly projects, called a project-oriented organization.   In this case, the project manager is assigned people who are dedicated to that project and work on it full time.   That manager controls the people and the resources needed to get the project done.

Matrix organizations

In between the two extremes of functional, where there is no project manager per se, to the project-oriented, where there is a project manager and that person is given full authority on the project, there are the matrix organizations which are have a project manager, but with somewhat less than total authority.

A weak matrix organization has a project manager, but the authority rests with the functional manager.   A strong matrix organization has a project manager, who has a moderate to high amount of authority.   A balanced matrix organization would essentially have mixed authority shared by the functional and project manager.   For example, authority over the project budget would normally rest with the project manager, but the availability of the human resources taken from the various departments would rest with the functional manager of those departments.

Composite organizations

This is a company that is large enough that is can use a functional organizational structure for some projects, and a matrix or even a project-oriented organizational structure for other projects.

So the amount of authority a project manager has increases in the following types of organizational structure:

functional → weak matrix → balanced matrix → strong matrix → project-oriented

And a composite organization would mixed the different organizational structure listed above.   In a conversation between Andy Crowe and two other PMPs from his Velociteach corporation, they discussed what type of organizational structure was their favorite to work at as a project manager, and they answered a strong matrix organization.

You would have thought they would have answered a “project-oriented” organizational structure, but here’s the reason why they chose the way they did.   In a strong matrix organization, the authority over the project was almost totally within the purview of the project manager.   However, one of the functions the functional manager served was to handle the human resource related matters related to the project, i.e., monitoring the team sheets of the team members from their department, and taking care of requests for time off, vacations, etc.    In a project-oriented environment, there were no functional managers to speak of, so a project manager had to take on those HR functions as well.   The two PMPs admitted that was NOT a favorite activity of theirs, and so they preferred the strong matrix organizational structure where they didn’t have to worry about any of that, and could concentrate totally on project-oriented activities.

The next variable is the complexity of a project, and this will be the subject of the next post.

6th Edition PMBOK® Guide–Organizational Governnance Frameworks


I am starting a project of going through the 6th Edition of the PMBOK® Guide and blogging about its contents.    The 6th Edition was released on September 22nd by the Project Management Institute, and the second chapter is a general introduction to the framework in which project management exists, starting with section 2.1 Project Influences.

Looking back on the first chapter, it contained the foundational elements of project management, showing in many cases the internal structure of a project.   The second chapter concentrates more on the exterior of a project, to the environments in which projects operate.  These environments can influence a project either favorably or negatively, and that is why a project manager needs to be aware of them.

In the past two posts, I discussed the two categories of project influences:

  • Environmental Enterprise Factors (EEFs)–conditions not under control of the project team that influence the project; these can be internal and/or external to the organization
  • Operational Process Assets (OPAs)–processes, policies, procedures, and knowledge bases that are specific to the organization

There is another form of influence on a project, and that is the governance framework of an organization.   Is an organization focused on operations, on projects, or something in between?    The type of organizational structure will influence many things on a project, such as

  • project manager’s authority
  • project manager’s role
  • availability of resources
  • management of the project budget
  • administrative staff on the project (the project management team)

I think the Table on p. 47 of the various types of organizational structure is a bit confusing, so I’m going to go through the types of organizational structure type in a series of posts to make sure the person studying for the test understands the strengths and weaknesses of each type, at least from the standpoint of a project manager.

In the next posts, I will discuss functional (focused on operations), project-oriented (focused on projects), matrix (focused somewhere in between operations and projects), and some other additional types (hybrid, composite).

6th Edition PMBOK® Guide–Operational Process Assets


I am starting a project of going through the 6th Edition of the PMBOK® Guide and blogging about its contents.    The 6th Edition was released on September 22nd by the Project Management Institute, and the second chapter is a general introduction to the framework in which project management exists, starting with section 2.1 Project Influences.

Looking back on the first chapter, it contained the foundational elements of project management, showing in many cases the internal structure of a project.   The second chapter concentrates more on the exterior of a project, to the environments in which projects operate.  These environments can influence a project either favorably or negatively, and that is why a project manager needs to be aware of them.

Figure 2.1 on page 37 show the two categories of project influencers:

  • Enterprise environmental factors–these are conditions which are not under control of the project team, that influence, constrain, or direct the project.  They can be either internal to the organization (such as organization culture) or external to the organization (such as legal restrictions).
  • Organizational process assets–these are the business practices or knowledge bases  specific to an organization which can influence the management of the project.  Examples include processes, policies and procedures.

This post will go into more detail into operational process assets.  Operational process assets are the plans, processes, policies. procedures, and knowledge bases specific to an organization.

In an earlier post on the concept of tailoring, the idea was discussed where the PMBOK® Guide was likened to a hardware store that has tools and materials to serve all types of customers, from the casual DIY homeowner to a corporation that builds skyscrapers.    The tools the customer needs will vary based on the type of project that is needed to be done.

In a similar way, the PMBOK® Guide contains all of the project management tools you could possibly use on a project, but the organization must then choose from that giant toolbox those tools that are useful to that organization.   It is that collection of processes, in addition to business policies and procedures, that make up one category of Operational Process Assets or OPAs.   The other category of OPAs would be organizational knowledge bases, especially those pertaining to previous projects done by the organization.    Although the first category are not updated as part of the project work, the knowledge bases are updated as a result of the compiling of lessons learned during the project.

This is why operational process assets are often generic inputs to many processes, whereas operational process assets updates are often outputs of those very processes.

Examples of OPAs in either category of a) processes, policies, and procedures and b) organizational knowledge bases are contained on pages 40 and 41 of the Guide.

The next post starts a review of the next section 2.4 on Organizational Systems.

6th Edition PMBOK® Guide–Enterprise Environmental Factors


I am starting a project of going through the 6th Edition of the PMBOK® Guide and blogging about its contents.    The 6th Edition was released on September 22nd by the Project Management Institute, and the second chapter is a general introduction to the framework in which project management exists, starting with section 2.1 Project Influences.

Looking back on the first chapter, it contained the foundational elements of project management, showing in many cases the internal structure of a project.   The second chapter concentrates more on the exterior of a project, to the environments in which projects operate.  These environments can influence a project either favorably or negatively, and that is why a project manager needs to be aware of them.

Figure 2.1 on page 37 show the two categories of project influencers:

  • Enterprise environmental factors–these are conditions which are not under control of the project team, that influence, constrain, or direct the project.  They can be either internal to the organization (such as organization culture) or external to the organization (such as legal restrictions).
  • Organizational process assets–these are the business practices or knowledge bases  specific to an organization which can influence the management of the project.  Examples include processes, policies and procedures.

This post will go into more detail into enterprise environmental factors.

There are certain categories of events or people that can influence a project.   Events that can influence a project are called risks, and there is a whole knowledge area devoted to identifying them, classifying them, and preparing risk responses to them.    People that can influence a project are called stakeholders, and there is a whole knowledge area devoted to identifying them, creating a strategy for engaging them and then carrying it out.

Enterprise environmental factors are more nebulous than either risks or people; they are conditions which can influence a project.   As such, they are out of control of the project team in a way that risks and shareholders are not, because they can at least be influenced.    It is important for project managers to be aware of the environmental enterprise factors or EEFs that may affect their project.   On a practical note for those studying for the PMP® exam, EEFs are what I call a “generic” input into project management processes, meaning that they are inputs to a great number of those processes.   Why?  Because that process will be influenced or shaped by one or more of those EEFs.

Okay, now what are some of the EEFs?   They are outside of the control of the project team, but they may be either internal to the organization or external to it.

Here are some of the internal EEFs.

  • Organizational culture–the values, code of ethics, and leadership style of management
  • Information technology software–this includes scheduling tools such as Microsoft Project or Primavera.
  • Infrastructure–information technology hardware and telecommunications channels.

There are additional ones listed on page 38 of the Guide, but this gives you an idea of what kind of EEFs are internal to an organization.   NOTE:   Please remember that the software you use on a project is considered an environmental factor or EEF and NOT an organizational process asset or OPA.   This is a mistake that many make on the exam.

What are some of the external EEFs?

  • Social and cultural influences–the culture of a country you are doing business with will influence how you interact with the team members, stakeholders, or customers from that country (see Erin Meyer’s book The Culture Map for a rich resource that goes into this topic in depth)
  • Legal restrictions–national, state and/or local laws and regulations
  • Physical environment–weather and working conditions

There are other examples on p. 39, but you can see from the above list that some EEFs such as legal restrictions will  more directly affect specific projects that deal with the products or services that are covered by those laws and regulations.   Others such as the physical environment will more generally affect the project, not to mention the operations of a particular organization.

The other category of project influences are organizational process assets or OPAs.   They are the processes, policies, and procedures of an organization, as well as their knowledge bases.   They will be the subject of the next post.

6th Edition PMBOK® Guide–Project Influences


I am starting a project of going through the 6th Edition of the PMBOK® Guide and blogging about its contents.    The 6th Edition was released on September 22nd by the Project Management Institute, and the second chapter is a general introduction to the framework in which project management exists, starting with section 2.1 Project Influences.

Looking back on the first chapter, it contained the foundational elements of project management, showing in many cases the internal structure of a project.   The second chapter concentrates more on the exterior of a project, to the environments in which projects operate.  These environments can influence a project either favorably or negatively, and that is why a project manager needs to be aware of them.

Figure 2.1 on page 37 show the two categories of project influencers:

  • Enterprise environmental factors–these are conditions which are not under control of the project team, that influence, constrain, or direct the project.  They can be either internal to the organization (such as organization culture) or external to the organization (such as legal restrictions).
  • Organizational process assets–these are the business practices or knowledge bases  specific to an organization which can influence the management of the project.  Examples include processes, policies and procedures.

From a practical standpoint for someone who is studying for the Project Management Professional (PMP®) exam, you should know that environmental environmental factors are often abbreviated as EEFs and organization process assets are often abbreviated as OPAs.   Because they influence how a project is done, they are “generic” inputs to many of the project management processes you will need to learn.

The next two posts go into some detail about the various kinds of EEFs and OPAs.

6th Edition PMBOK® Guide–Project Success Criteria


On reviewing the 6th Edition PMBOK® Guide–I’m taking on the last section of the first chapter, namely, the section on project success criteria.

Stakeholders may differ on makes a project successful, so it is important to state the project objectives that are clear and measurable.

They may link up to the business need fulfilled by the project or to the organizational strategy.   The more they do so, the higher chance the project has to succeed.