Project Management: Designing Effective Organisational Structures in Construction

Editorial Reviews. From the Back Cover. Organisation structure can make or break the project Project Management: Designing Effective Organisational Structures in Construction - Kindle edition by David Richard Moore. Download it once.
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Weber's model is an idealised design, a concept of theory, which was believed by Weber to be the most effective design for companies in early 20th century.


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However bureaucracies were much criticised by sociologists and philosophers, including Karl Marx, for example. They suggested that bureaucracies are used primarily to control people and have strict rules, which stifle the enthusiasm and initiative of the employees. Bureaucracies have been used for many years in many companies with many modifications to Weber's idealised model. This has produced a pragmatic evaluation of the bureaucracy concept and many scholars and management consultants , including the famous Peter Drucker and others, observed it closely and proposed modifications to the Weber's model.

Warren Bennis summarised some of the bureaucracy deficiencies as follows [5]:. During many years of using the more traditional bureaucratic models in companies some modifications to the ideal model have been developed and observed. The most distinctive characteristics are centralisation versus decentralisation and tall versus flat structures.

There are three alternatives for how a structure can be decentralised: It is generally considered that decentralisation is better than centralisation. Decentralised structures increase people's autonomy. With more autonomy comes more intellectual development and the possibility of people's own realisation, bringing with it more satisfaction. Globalisation also brings opportunities for companies to spread into other markets and build their subsidiaries in different countries, which leads to an increase in decentralisation.

The terms ' flat ' and 'tall' concern the scope of control in the company. Whereas the classical principle of span of control is concerned with the number of subordinates one superior can effectively manage, the concept of flat and tall is more concerned with the vertical structural arrangement for the entire organisation [73].

Whereas the traditional bureaucratic structure is very tall, the modern view of organisational theory tends to prefer flat structures. In fact both of have their advantages and disadvantages. Tall structures offer better control for managers of lower levels. Managers are responsible for fewer people which makes it possible to maintain stronger relations with them. The flat structure has better response to commands coming from the top because the route is shorter fewer levels and there is less potential for information becoming biased on its way.

Flat structures also better allow individual initiative and self-control. Amongst the criticism of the Weber's traditional approach to organisation theory include arguments that 'Weber really did not intend for it to be an ideal type of structure. Instead, he was merely using bureaucracy as an example of structural form taken by the political strategy of rational-legal domination' [].

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As the market has progressed and evolved during the last century a new phenomenon has risen — competitiveness. With more companies in the market producing and offering substitute or exactly the same products , companies needed to start redesigning their structures to become more effective. Four organisational theories evolved, which constitute modern organisation theory. The information processing view focuses on the company as a system, which receives, gathers, processes and produces information.

Construction organisation design - Designing Buildings Wiki

Because there are many other similar systems outside interacting together other companies and the environment the organisation must deal with some degree of uncertainty. The uncertainty is defined by Jay Galbraith as 'the difference between the amount of information required to perform the task and the amount of information already possessed by the organisation' [35]. Companies need to respond to change coming from outside and adapt to survive. Tushman and Nadler [] suggest that 'Given the various sources of uncertainty, a basic function of the organisation's structure is to create the most appropriate configuration of work units as well as the linkages between these units to facilitate the effective collection, processing, and distribution of information.

Tushman and Nadler formulate the following propositions about an information processing theory:. Because of the increasing competitiveness of companies in the market, managers started to look for new, better organisational structures. In the last fifteen years of the 20th century some widely recognised organisational structures have developed and been successfully applied:. The modern trend in business is to supply services rather than just goods. The specialisation of companies means that they are focused on their core business and for support services they need complementary services from appropriate partners.

The complete service one-stop-shop includes a large number of activities for the supplier. A 'complete service ' could be treated as project management. The company needs to manage the whole business cycle from communicating with the customer and specifying what they need, through making or developing a product , to delivering and maintaining it.

Moreover, the company can have many simultaneous projects producing different types of outputs, in contrast with the classical company structure where the company produces only centrally specified types of outputs. In this form of company it is not possible to centrally plan what each unit will do because each project needs something different. To aid this business strategy the project design structure has appeared.

Note that both projects are using the same units departments of the company, but for different purposes. This is typical, but for specific purposes there is a modification of this typical project structure. The other thing that is needed if the company wants to adopt a project design structure is different styles of management. Change happens all the time, everywhere. This requires dynamic activities to successfully manage the whole structure.

The managers must become reoriented to the management of human resources rather than strict, functional rules. Good relations between each of the project groups are crucial for achieving effectiveness. The project structure is a concept of management and not only a form of structural organisation. A matrix structure is one of the most applied organisational structures. A matrix structure is a combination of functional and project organisational forms. In a matrix organisation, each project manager reports directly to the general manager in large companies there could be more levels.

Since each project represents a potential profit centre, the power and authority used by the project manager comes directly from the general manager. The project manager has the total responsibility and accountability for the success of the project. Each functional unit is headed by a functional manager whose prime responsibility is to ensure that a unified technical base is maintained and that all available information can be exchanged for each project. The main difference in the matrix structure is that the same unit is used by many projects.

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It is up to project managers who will do what and when. Observation of companies utilising matrix structures shows that '[ Horizontal organisations consist of teams which are organised around business processes rather than functional departmentalism.

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The teams are responsible for the results they generate. They are measured and people are rewarded according to team results, not individual performance. This approach leads to a better focus on the task rather than individual specialisations. In order to be a successful horizontal structure , all employees need to be fully informed and trained. Communication between and inside the team is crucial. People should be provided with full data, not just some parts, and in conjunction with this information an ability to interpret it to produce better decisions.

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Project Management: Designing Effective Organisational Structures in Construction

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