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304 CHAPTER 8 • PRoduCT And sERviCE dEvEloPmEnT And oRgAnisATion
organisational structure. Both these criteria need to be incorporated in the organisa-
tional structure that is built to support a development project.

Project-based organisation structures
The total process of developing concepts through to market will almost certainly
involve personnel from several different areas of the organisation. Most functions will
have some part to play in making the decisions that will shape a final design. Yet, any
development project will also have an existence of its own. It will have a project name,
an individual manager or group of staff who are championing the project, a budget
and, hopefully, a clear strategic purpose in the organisation. The organisational ques-
tion is which of these two ideas – the various organisational functions that contribute
to development, or the development project itself – should dominate the way in which
the development activity is managed? The matrix form of organisation is a compromise
between two (or more) approaches to clustering resources. It is an ideal model to exam-
ine the debates over an appropriate organisational form for development projects. Here
the two conflicting approaches are the functional (specialist) dominated structure and
the project (or programme) dominated structure.
In a purely functional organisation all staff associated with the design project are
based unambiguously in their functional groups. There is no project-based group at
all. They may be working full time on the project but all communication and liaison
is carried out through their functional manager. The project exists only because of
agreement between these functional managers. At the other extreme, all the individual
members of staff from each function who are involved in the project could be moved
out of their functions and perhaps even physically relocated to a ‘task force’ dedicated
solely to the project. A project manager, who probably holds the entire budget allocated
to the design project, could lead the task force. Not all members of the task force neces-
sarily have to stay in the team throughout the development period, but a substantial
core might see the project through from start to finish. Some members of a design
team may even be from other companies. In between these two extremes there are vari-
ous types of ‘matrix’ organisation, with varying emphasis on these two aspects of the
organisation (see Figure 8.13). And, although there are, in practice, an infinite number
of structures, five stereotypical positions on the continuum are often discussed:
● Functional organisation – The project is divided into segments and assigned to relevant
functional areas and/or groups within functional areas. Functional and senior man-
agement coordinate the project.
● Functional matrix (or lightweight project manager) – A person is formally designated
to oversee the project across different functional areas. This person has limited
authority over functional people involved and serves primarily to plan and coor-
dinate the project. The functional managers retain primary responsibility for their
specific segments of the project.
● Balanced matrix – A person is assigned to oversee the project and interacts on an equal
basis with functional managers. This person and the functional managers jointly
direct workflow segments and approve technical and operational decisions.
● Project matrix (or heavyweight project manager) – A manager is assigned to oversee
the project and is responsible for the completion of the project. Functional manag-
ers’ involvement is limited to assigning personnel as needed and providing advisory
expertise.

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