Question

Question 1

Organizational structure impact greatly on the management of projects:

a. Given that a project is to be undertaken by either the Ministry of Agriculture (a highly functional organization) or the Hunger Project (a projectized organization) with the aid of diagrams, critically assess the potential impact the organizational   structures could have on the management of the project in the respective organizations

b. Using a diagram to illustrate that organizational structure is a continuum, critically analyze the effectiveness of a matrix organizational structure for monitoring and control of a project within a Matrix Organization

Question 2

a. Produce a risk register template showing all the essential headings and evaluate the significance of the Earned Monetary Value and the Risk Response Owner in the overall scheme of developing Risk Management Plan

b. A company is in the process of inventing an unmanned vehicle for the defense industry. There is serious disagreement on whether the company should move straight into commercial production or they should first build a prototype. The available data indicates that building the prototype will cost the company $400,000 with a failure rate of 5% and an impact of $10,000. If the prototype succeeds there will be no impact. However, the data for not building the prototype and moving straight into commercial production shows a failure rate (probability of failure) of 95% with an impact of $4,000,000.

Using expected monetary Value (EMV) and a Decision Tree as a project manager:  

1. Construct a Decision Tree for the above case
2. Critically analyze the options available and advice on the best option based on the data provided

Answer 1

Question-1

a. There are basically three types of organization structures namely functional, projectized and matrix structures.

In a functional organization, every function will have a manager and information flow happens within every individual team only. Communication in and out of functional departments will happen through the functional managers and there will not be any flow of information between team members of different functional departments.

Ministry of Agriculture has this type of organization structure and there are several benefits and drawbacks for this type of organizational structure. The ministry of Agriculture will be a very large organization and hence this type of structure will help gain control over the team members. This is a very hierarchy-oriented structure in which every team member reporting to their respective managers. Another benefit for this type of structure is that there can be subject experts working together and they will be immune to the noises of other functions. People will be able to concentrate on their work.

While there several are advantages, there are disadvantages also like if you need information from other team members, you will have to follow a proper communication channel. Potential for conflict between members of different team is high because every team member will be loyal to their functional managers only. This type of structure will need more control to maintain as communication between members of different teams shall be avoided.

In projectized organizations, there will be several project managers who will be looking after projects. In this structure, the project manager will have supreme power and all information will be channelled to the project manager. There will be communication between different team members as well. Below shown is a representation of this type of organization.

This type of structure will channel all team members focus towards a common goal and loyalty conflicts will be low. While this is a better structure than functional structure, projects are generally temporary endeavours and hence after the completion of the project, team members will not have a place to work in, they will have to find other jobs.

Hunger Project will have the above stated benefits when they manage their projects when compared to organizations with functional structures. This type of structure will help managers schedule the work. As all team members are working towards common goals, progress measurement, tracking and expediting of projects are possible, which are not possible in functional organizations.

b. Matrix Organizations are organizations that have both the qualities of functional as well as projectized organizations. A typical arrangement of this type of structure is shown below.

As shown above, in Matrix organisations, every team member will report to their functional managers as well as the project managers. The communication between team and functional managers are vertical and between project managers and team members are horizontal. In this type of structure, team members will have multiple bosses.

This type of structure will combine benefits of both the organizational structures. As project managers and functional managers can share power and resources, there will be better control over projects. Information in the organization will be shared among team members and even if some member leaves the organization, the organization will be least impacted compared to other structures. These types of organizations are complicated and may need additional resources and money to operate.

Question-1

a. Risk Register Template is a tool for analysing potential risks related to projects. A template is given below for reference.

RISK	RISK LEVEL Level of risk occurred (small,medium,high etc.)	IMPACT (Effect of risk towards stakeholders)	RISK RESPONSE (Response towards risk occurred)	RELATED PARTIES Parties that affected due to the risk occurred)

Expected Monetary Value (EMV) is a technique used in risk management and it is a part of the perform quantitative risk analysis process. This is a mathematical technique and it will help assess the impact of risks on projects.

While developing a risk register, EMV technique is used to assess the impact and probability of risks from occurring. Risk owner will be the person who will be in charge of risks and he will have to evaluate the potential of risks from occurring, monitoring it continuously and finding creative ways to avoid, mitigate or transfer risks so that its impact on projects are minimized or avoided.

The EMV calculations include basic mathematical equations for analysing risks. (EMV = Probability x Impact).

b.

Decision tree is a project management tool that will help analyse situations so that informed decisions can be made. Decision tree for the question is as constructed below.

The options that are available are to make a prototype or to not make a prototype. The Earned Monetary Value for both options from the above decision tree are $500 and $ 200,000, respectively. It will be best to go with making the prototype as there is a for the company to lose $ 200,000 if they proceed without making the prototype. Even if the prototype fails, it will risk them $500 only.

The best option in this situation to make a prototype before going for actual production.