Factors that influence the project Organisation structure
- Technological changes. Technological revolution may lead to complexity, varieties of new products, development of new processes, new data, new labour competences, new tools, new ideas etc and all these factors must be harmonized to ensure conformity, compatibility and compliance with the ever-changing technologies in the market.
- Simplicity or complexity of the project. Resources required to implement a project depend very much depend on how simple or complex a project is. A project organizational structure therefore must be developed in such a way that the unique needs of the client are addressed adequately, effectively and cost effectively.
- Nature of the product to be rolled out by the project. A project rolling out tangible goods or services or works requires different and appropriate organizational structures if good and satisfactory results are be achieved. Expected profitability or value for money plays very crucial role in structuring the organization.
- Market competition. The organization has to be structured in a way that will give it a competitive edge over the competitors in the market as only fittest can survive in such a market.
- Value of the project. The total project cost or value of money invested in the project gives a proper guide on the most appropriate structure the project should adopt.
- Staff technical competences. Develop an organizational structure that the available staff in the organization can conveniently, efficiently and effectively manage.
- Whether the organization is mechanistic or organic. The need for centralization or decentralization of authority, making rules and procedures or fewer tasks, formalized communication or internal communication etc. will to a great extent influence the most appropriate structure to be adapted by an entity.
- Differentiation – integration dimension. The need for specialized technical competences and division of labour plays a big role in deciding the appropriate structure an organization may adopt.
- The size of the organization. The size of labour force on full time basis determines the right structure an entity may adopt. Larger organizations tend to more formal, have more rules, more regulations, increased job specialization, complex decisions to be made etc. while smaller organizations tend to be more informal, have fewer rules and less need for specialized technical competences. All these variables play very important role in determining an organizational structure that will fit best a particular entity.
- The lifecycle stage of an organization. The stage at which an organization is very much influences the right organizational structure. An organization at birth, youth, midlife and maturity stages will have different organizational structures at each different stage of lifecycle as the organization evolves from one stage to another.
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