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Functional Organization (Figure 18.14, page 662) –– Advantages:
(a) Enables the development of a better technical capability. Specialists can be grouped to
share knowledge. Experience from one project can be readily transferred to other
projects through personnel exchange. Cross–training is relatively easy.
(b) The organizations can respond quicker to a specific requirement through the careful
assignment (or reassignment) of personnel. There are a larger number of personnel in
the organization with the required skills in a given area. The manager has a greater
degree of flexibility in the utilization of personnel and a broader human–power base
with which to work. Greater technical control can be maintained.
(c) Budgeting and cost control is easier due to the centralization of areas of expertise.
Common tasks for different projects can be integrated, and it is easier not only to
estimate costs but to monitor and control costs.
(d) The channels of communication are well established, the reporting structure is vertical,
and there is no question as to who is the “boss.”
Functional Organization –– Disadvantages:
(a) It is difficult to maintain a strong identity with a specific project. No single individual
is responsible for the total project or the integration of its activities. It is hard to
pinpoint specific project responsibilities.
(b) Concepts and techniques tend to be functionally–oriented with little regard to project
requirements. The “tailoring” of technical requirements to a particular project is
discouraged.
(c) There is little customer orientation or focal point. Response to specific customer needs
is slow. Decisions are made on the basis of the strongest functional area of activity.
(d) Because of the group orientation relative to a specific area of expertise, there is less
personal motivation to excel and to be innovative concerning the generation of new
ideas.
Project Organization (Figure 18.15, page 663) –– Advantages:
(a) The lines of authority and responsibility for a given project are clearly defined. Project
participants work directly for the project manager, communication channels within the
project are strong, and there is no question as to priorities. A good and strong project
orientation is provided.