Value Driven Design Logo

2.08 - Organisation Structure

Features of Traditional Functional Management

  • No overall ownership of the project as an integrated set of activities or work packages
  • Fragmentation of activities into specialist groupings
  • Long lead-times due to activities taking place as work moves between departments

Features of Project Management

  • Ownership of the project by a dedicated multi-discipline team
  • Integration of supporting functions, for example, Product Engineering and Manufacturing Systems Engineering
  • Short-times due to parallel and interactive work on all activities

A combination of Project and Functional management is required to suit the project mix in a particular Business or Product Unit with clear ownership of the projects and the associated work packages – particularly where work-packages are sub-contracted internally or externally.

Project Scale Categorisation





Narrowly focussed projects lying within specialist functions

Functional Manager or subordinate


Crosses a few functions only

Lead function that owns & manages it.


Big new projects requiring a mix of all functional skills,

e. g. product introduction or Business change project

Project Manager in Matrix style

Organization to Support Project Management

Organization to Support Project Management

Important Elements

  • The Head of Projects has a nucleus of permanent staff of Project Managers, Technical Managers and Engineers who can be rotated between projects, depending on the size of organisation.
  • Additional people are allocated from the support functions by the Resource Allocations Committee.
  • A budget is required for each project set against each stage of project attainment. See section 6.00 for New Product Introduction (NPI) process.
  • Each large project has its own:
    • Commercial / Finance Administrator
    • Planning Manager, with functional link to Company Programme (or Timing) Manager*
    • Clerical Staff
    • Engineering Change Board
    • Quality and Reliability team

A programme manager is required in a large organisation to:

  • Audit progress of all significant projects.
  • Operate a problem and risk escalation procedure.
  • Maintain a clear view across all projects for a particular customer.
  • Ensure consistent application of best practice.
  • Assist with initial project planning and resourcing at project initiation and start-up to ensure uniform application of best practice.

Key Requisites for the successful introduction of Project Management

  • Training of core manager groups for each project team
  • The project Manager must own the budget – functional heads therefore have to “sell” their resources to him in order to support their departments via work package contracts.
  • Divide projects into “Runner, Repeater and Stranger” categories and make functional heads the owner for the first two.
  • Operate job rotation, that is, now and again make a functional head the Project Manager for a big new “Stranger” type project.
  • Re-integrate some of the specialist fragmented functions into broader based functional units and provide multi-skill experience and training. They protect standards and are responsible for specialist training.

Warning! - There is a HIGH RISK of FAILURE if any of these items are missed.

Further Reading