Multi Projects Inc. is a well-established consulting firm with 400 employees. The firm operates in a matrix organizational structure where project managers are appointed as the company acquires new projects. Multi Projects has a good reputation. Due to the company’s growth, things have been hectic with employees trying to keep up with the work load. The company performs a range of consulting services, including market research, manufacturing system design and executive recruiting. Their customers are medium to large businesses, banks manufacturers and government agencies. 30% of their business is from previous clients. The company specialises in small to medium projects and they target growing companies for their future business.
Multi Projects just got a call from Growin Corporation, which wants to go forward with a project that Multi Projects proposed nearly six months ago. Jeff Armstrong has been assigned as project manager for the Growin Corporation project and desperately wants to have Tyler Bonilla who has an excellent reputation assigned to his project; however, Tyler is working full-time on a project run by Julie Capriolo for Goodold Company.
This case study highlights the several problems within Multi Project Inc. and it presents an assessment of the problems and points out the reasons which led to the challenges the company is facing. Multi Projects Incorporated is growing its customer base and maintaining an effort to achieve maximum project effectiveness, yet the project delivery efficiency is lagging behind in both learning and growth, and internal processes. Through the balanced scorecard a path and flow for achieving the strategy and the mission of Multi Projects Inc. can be achieved. This consists of determining the rules, principles and instruments that will ensure the bureaucratic functioning of both project and organisational activities in the internal processes of the company. Areas of focus for the investigation are identified in the case evaluation, while detail for each aspect was derived from both the internal and external organisational pressures that Multi Projects Inc. is facing. The recommended alternative for Multi Projects Inc. will ensure the full utilisation of the matrix structure which will improve internal processes, communication, organisational behaviour and succession planning which will ensure that the firm maintains its good reputation, acquire new business while sustaining its current client base.
3.Internal environmental analysis
•Gido & Clements (2012) states that the matrix structure provides a core of functional expertise that is available to all projects. In Multi Projects Inc. there is great dependence on one Systems Engineer namely Tyler Bonilla. The firm’s resources are inefficiently utilized. •The matrix organizational structures provides for the effective use of company resources, however there is a “need for balance of power” and therefore referral to the operating guidelines is crucial (Gido & Clements 2012). In Multi Projects Inc., there seem to be no guideline established to ensure proper balance of power between the project managers and functional managers in that Jeff (a project manager) went and “recruited” his own team member without negotiations with the functional manager (Jennifer).
•The matrix organization provides opportunities for people in the functional components to pursue career development through assignment to various types of projects. As they broaden their experience, individuals become more valuable for future assignments and enhance their eligibility for higher-level positions within the company (Gido & Clements 2012). Tyler was bored with working on the Goodold projects and felt that he was not learning anything new and prefers a new challenge. •It is critical to specify to whom the team member reports and for what responsibilities or tasks. Therefore it is important that the project management responsibilities and the functional management responsibilities be delineated in a matrix organization. Tyler Bonilla informed the Project Manager (Jeff) instead of his functional manager (Jennifer) that he was bored on the Goodold projects and needed a new challenge. This is a functional issue and it’s not project related.
•A core competence gives value to customers, makes the company’s products different from those of competitors, and can be used in creating new products. Strategically, this means that companies should commit to excellence and leadership in competencies, and strengthen those before they commit to winning market share for specific products (Bateman & Snell 2007). In Multi Projects because of the growth, things have been quite hectic with employees trying to keep up with work, keep old clients satisfied and bend over and backward to accommodate new clients. Multi Projects has been hiring new employees. The huge dependence on Tyler is an indication that the company does not have sufficient highly skilled system engineers.
•The organisation has a matrix structure
•Well-established firm with various clients
•The organisation is growing
•400 employee base
•A number of experienced employees
•Dependence on a few expert employees
•Lack of balance of power between functional & project managers
•Lack of employee growth (Tylor stuck in the same type of projects)
•Shortage of high skilled system engineers
•The firm performs a range of services – it’s too diverse yet its core competencies are lacking
•Ineffective use of the matrix structure
•Lack of processes and procedures for project management
•There is no prioritisation of projects
•Lack of team culture
•Lack of leadership in the PM office
•Learning and knowledge transfer
•Competitors – other consulting services firms
•New market entries
4.Assumptions and Constraints
•The case study makes no mention of a PMO vice president or Portfolio/Program manager. It is assumed that this position does not exist in Multi Projects. According to Clements & Gido (2012: 409) such a unit plays an important role in the matrix organisational structure. •Operating guidelines are not in place at Multi Projects Inc. Gido & Clements (2012:411) states that a company that uses a matrix organisational structure must establish operating guidelines to assure a proper balance of power between project managers and functional managers. If there is an imbalance of power, such conflicts may not be resolved in a manner that will be in the best interests of either the customer or the company (Gido & Clements 2012:411).
This is evident in that a conflict arose as to which project Tyler Bonilla should be allocated to when the firm acquired the Growin project. Jeff Armstrong, who is ambitious to make a name for him, put his interests first and the company’s or clients’ interests were not put forth.
•There are three types of matrix structures (Burke 2003:290) and it is assumed that Multi Projects Inc. has a balanced matrix structure where the project manager through a project office would negotiate with the functional departments for resources to implement the project (Burke 2003:294).
•Projects are not prioritised accordingly.
•Also there seems to be no formal communication lines between various stakeholders in the organization.
•Multi Projects Inc. must maintain its good reputation and business with the existing clients and also be able to acquire new projects from new clients to expand its client base and business.
The setup of managing projects and a project business as a whole is referred and conceptualized by the term Project Portfolio Management. PPM focuses on the management of the project environment, aligning projects to business objectives. It refers to the dynamic management process of portfolio related to strategic planning, portfolio evaluation and selection; resource allocation and monitoring, as they are integrated to organizational management context (Dietrich 2002).
The most common challenges of the matrix organisational form are misaligned goals, unclear roles and responsibilities, ambiguous authority and Silo-focused employees.
In the Multi Projects Inc. case study, it is evident that there are competing or conflicting objectives between matrix dimensions; inadequate processes to align goals and detect possible misalignments; lack of synchronization, coordination and poor timing of work plans and objectives and insufficient communication and consultation between matrix dimensions. This causes confusion over roles and responsibilities, a lot of tensions among employees and personal conflicts between leaders hinder collaboration between units.
It is not clear whether there is a structure in Multi Projects Inc. to determine and clarify the placement of power and authority. Leaders in Multi
Projects Inc. are unaccustomed to sharing decision rights and this causes delays in the decision making processes.
Multi Projects Inc. has to manage the following principal organizational elements: Strategy; Structure; Processes; Rewards and People. These principal elements will help determine systems cutting vertically and horizontally across the organizational structure; determine the placement of power and authority in the organization and help with the management of HR to produce talent and skills necessary for the organization.
6. Alternatives Analysis
6.1.1 Alternative 1
The full implementation of the matrix balanced structure by drawing up organisational guidelines and process that supports this structure and the ccreation of a project management office. Kerzner (1998:118) states that when operating under a matrix management approach, it is obviously extremely important that the authority and responsibility of each manager be clearly defined understood and accepted by both functional and program people. These relationships need to be spelled out in writing. It is essential that in the various operating policies, the specific authority of the program direction, and the authority of the functional executive be defined in terms of operational direction. The full implementation will require the following to ensure success of the structure: Training in matrix operations
Training in how to maintain open communications
Training in problem solving
The creation of a PMO had advantages that would simultaneously solve a number of the systemic problems inherent in the Multi Projects Inc. organizational structure. This would of course require a strategic transformation project to be initiated but the long term benefits of the change are significant and are illustrated in the report. We also recommend that Multi Projects Inc. should introduce a team building strategy to resolve a number of team dynamic issues that are prevalent. Advantages:
-Balance of power between the project managers and functional managers
-Good communication amongst the stakeholders
Prioritization of organizational and client’s needs
Dual reporting relationships
Need for balance of power
Implement an autonomous projects organisational structure
In the autonomous project organisation each project operates as its own somewhat independent entity. All resources needed to accomplish each project are assigned full time to work on that project. A full-time project manager has complete project and administrative authority over the project team (Clements & Gido 2012:403). This type of structure would resolve the conflict identified in Multi Projects Inc. where two project managers required the same systems engineer to be assigned to their projects, each project manager will have a systems engineer solely dedicated to their project without having to fight for the same resource. Advantages:
Each project operates as its own entity with its owns resources assigned full time
The project manager has complete project and administrative authority over the project team
This type of structure limits conflict between project managers and functional managers
Rapid reaction time is provided
The costs to maintain are high as there is duplication of functions
Lack of career continuity and opportunities for project personnel
It does not foster a learning culture as there is no interaction between functional personnel 6.1.3Alternative 3
Leave the status quo.
No financial implication associated with changes
The organisation will carry on operating as, no need for change management
Potential to lose on growth as the current systems cannot keep up with the demand
Current existing problems will prevail
The moral of the employees will be impacted on badly; they can’t keep on bending backward
6.2 Alternative selection criteria
The basis of organisational performance and improvement elements were considered namely the structural, operations and behavioural strategies (Cranefield study guide pg. 73) in evaluating the alternatives. Criteria:Alternative 1Alternative 2Alternative 3
Structural strategy-The matrix structure allows for efficient utilisation of resources. – The matrix structure provides a core of functional expertise. – It allows for learning from one another.
– Allows for balance of power between project managers & functional managers
– The autonomous ensures control over resources
– Rapid response to clients- In the current arrangement the is conflict, poor communication, no prioritisation of projects, no balance of power between project managers and functional managers, employees are bending backward Operations strategy
-Clear roles and responsibilities between functions -Collaboration between departments
– Client and organisational focus-Project entity based
-Client focusedFunctional/project focused
Behavioural strategy-Training on open communication amongst the stakeholders & problem solving.
– The structure will facilitate team work/positive team culture -Silo based mentality-Self-interest/personal gains
– Lack of mutual
-Lack of team culture
Alternative 1 is recommended as a project structure for Multi Project Inc. Structural strategy:
A balanced matrix will solve the problem of highly depending on one system engineer (Tyler). This is the type of matrix structure, where the project manager would negotiate with the functional departments for resources to implement the project. Implementing a project management office is the ideal solution for building and maintaining the project management practice as a capable function of the organization. A successful project management office can improve the productivity of the project teams. In addition to that, it can make the organization a more matured and capable entity. Operational strategy:
Align company resources with the organizational objectives.
Introduce team building activities, to strengthen trust and collaboration. This will improve communication; ensure shared understanding and alignment of project objectives. Exceed customer’s expectations by completing the project within the stated deadline, budget and quality. Behavioural strategy:
Address conflict symptoms and behaviour promptly and openly. Make use of communication channels, both formal (such as the goals, policies and procedures of an organization) and informal. 8. Conclusion
The above case study on Multi Projects Inc. confirms that functional and project Managers face different challenges in a matrix organization. There is ambiguous authority and silo-focused employees. We cited misaligned goals as a challenge and identified that a PMO office has to be established for maintaining the project management practice as a capable function of the organization. In this case study, we describe the principles of successful management in a multi-project environment. The study emphasizes the importance of aligning projects with strategy, sharing information and managing complex interactions between project and functional structures, clarifying roles and responsibilities, and horizontal and vertical communication. Skills development and transfer in the organization for employees is also a crucial aspect to focus on so that dependence on expertise is not only on one or a few people but broader.
I.Challenges and Strategies of matrix organisations a survey by Thomas Sy, College of Business Administration, California State University II.Challenges and Strategies of Matrix Organizations: Top-Level and Mid-Level Managers’ Perspectives Thomas Sy, College of Business Administration, California State University, Long Beach; Laura Sue D’Annunzio, A.T Kearney Inc. III.Dietrich P., 2002, Project portfolio management-The case of a public organization, Master’s Thesis, Helsinki University of Technology, 108p. IV.Effective Project Management by James P Clements & Jack Gido 5th Edition 2012 V.http://www.di.ufpe.br/~gmp/docs/papers/Successful%20management%20in%20multi-project%20environment.pdf VI.Management: Leading & Collaborating in a Competitive World by Thomas S Bateman & Scott A Snell 7th Edition 2007 VII.Project Management by Rory Burke 4th Edition 2003
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