ENGINEERING MANAGEMENT

The Organization

Raymerose Daque
Kinneth Mae Maghanoy
Eduard Animo

THE ORGANIZATION
An organization may be considered group of people with defined
relationship to each other.
By an organization, one may also be referring to a collection of human
and material resources, which are gathered together for a stated
aim.
At a more general level, an organization may also refer to a structure
defining the division of work and interaction between individuals,
groups and resources.

THE ORGANIZATION
ELEMENTS:
A collection of people in formal and informal groupings.
Individuals who have defined tasks and responsibilities, some of
which may consist of specialization.
The manner in which these tasks interact and relate to each other is
defined.
The tasks all lead to achievement of a common aim.

TRADITIONAL VIEW OF AN
ORGANIZATION
HIERARCHICAL

Command
and
control

Information

TRADITIONAL VIEW OF AN
ORGANIZATION
FLATTENED

Information

Command
and
control

THE ORGANIZATION
These changes have been driven by:
The emphasis in organizations on the attainment of results rather on
the process used in achieving them.
The emphasis on horizontal activities within the organization in
order to gain influence and information, rather than vertical activity.
Many more opportunities for action and exerting influence within an
organization.
The realization that external contacts are becoming an important
factor in being able to wield internal influence and power.
Rapidly disappearing formal control mechanisms between
managers and subordinates.
No clear career progression paths within the organization, but many
more opportunities for advancement.

ORGANIZATIONAL DYNAMICS
The Management

create conditions for the organization

to learn and develop.

Staff

take actions based on their past

experience and memory, repeating
actions that were known to have
worked in previous similar situations.

However, situations change, and staff must be willing to experiment,

learning from new experiences. For effective learning, the manager
must create an open, questioning environment, very different from the
structures of the past, where staff obeyed orders either out of fear or
blind loyalty.

ORGANIZATION STRUCTURES
Defining a structure
An organization structure is the way the organization allocates
its resources towards meeting its strategic aims. It is commonly
defined by organization charts.

ORGANIZATION STRUCTURES
Groupings for common organizational structures:
ORGANIZATION
STRUCTURES

GROUPING

LINE
STAFF
PROJECT-BASED
FUNCTIONAL
FLEXIBLE

HIERARCHICAL

MATRIX

MATRIX

INFORMAL

INFORMAL

Hierarchical Organizational
Structure

Hierarchical organizational structures are

probably the most common and often
considered to be essential for control of
large organizations. ( Jaques, 1990)

Definition of Terms
Span of Control. The number of people that report back
to one manager in a hierarchy.
Chain of command. The order in which authority and
power is delegated from top management to every
employee at every level of the organization.
eg; Military forces are an example of straight chain of
command.
Authority. The rights inherent in the managerial position
to tell people what to do and expect them to do it.
Unity of Command. The concept that a person should
have one boss and should report only to him.

Types of Hierarchical Organizational Structure

Line
Staff or Functional Authority
Line-and-Staff
Geographic
Functional
Project

Line Organizational
Structure

There are only line

departments- departments
directly involved in
accomplishing the primary
goal of the organization.
In a line organization, top
management has complete
control, and the chain of
command is clear and
simple.

Staff or Functional
Authority
Organizational
Structure

The staff personnel

who are specialists
in some fields are
given functional
authority ( the
right of staff
specialists to issue
orders in their own
names in
designated areas).

The principle of unity of command

is violated when functional
authority exists.
Some staff specialists may exert
direct authority over the line
personnel, rather than exert advice
authority.

Line-and-Staff
Organizational
Structure

Has a direct, vertical

relationships between
different levels and
also specialists
responsible for
advising and
assisting line
managers.
Most large
organizations belong
to this type of
organizational
structure.

In general, functional
authority of staff is
replaced by staff
responsibility so that the
principle of unity is not
violated.

Geographic
Organizational
Structure

Geographic
organizational
structure is used
for organizations
that have offices
or businesses
units in different
geographic
locations.

Geographic organizational structure is used

mainly in industries like retail and hotel chains,
transportation and other large national and
international organizations. Manufacturing
organizations with several plants in different
geographical locations may choose to operate
using a geographic structure.

Functional
Organizational
Structure

In a functional
structure, positions
are grouped based on
the type of work they
do and the skills
required to complete
that work.
Organizations
employing this kind of
structure divide
themselves into
functional areas like
marketing,
engineering, and
accounting.

Project
Organizational
Structure

Organizations arrange
their activities into
programs or portfolios,
and implement them
through the projects.
The project manager
has full-time team
members working
under him.

Amatrix organizational structureis a company structure in

which the reporting relationships are set up as a grid, or matrix,
rather than in the traditional hierarchy. In other words, employees
have dual reporting relationships - generally to both a functional
manager and a project manager.
Matrix management is suitable for use in situations needing
multiple simultaneous management capabilities (Bartlett and
Ghoshal, 1990).

Figure 1 A Simple management scheme

Responsibilities of Project and

Functional manager within a
Matrix Organization

Project responsibility
Provide day-to-day guidance on work to be done
Determine all priorities related to work.
Ensure funding levels available for work including special tools
Ensure conflicts between functions resolved
Plan project and ensure project objectives are being met
Provide customer interface
Monitor project progress including resource usage and spend

Functional responsibility
Provide personnel of correct skills for job to be done.
Determine methods to be used in carrying out task, including
tools.
Look after pay and rations of staff including personal
achievement.
Ensure technical know how transferred between projects.
Monitor progress of functional contributors and help with
technical problems.

Functional manager is responsible for;

Looking after the personal needs of the individual engineer

Ensuring that high quality standards are followed on the project
and;
There is a home for the engineer to go to at the termination of
the project

Project
organization

Project organization
(%)

100

50

Matrix
organization

Functional
organization

50

Functional control
(%)

10
0

Figure 2 The relationship between project, functional and matrix organization

The matrix organization has several aims:

To allow projects to be formulated, grow and deliver products to the

costumer, including post-sales support, with minimum time and
expense.
To provide staff leveling.
Overall staffing level

Project 1

Figure 3 Staff levelling

Project 2

Project 3

Project
4

 To provide a project focus on all the work being.

To provide a focus on the costumer.
To provide a view across all the various functional areas in
order to determine the impact of developments or changes in
one area on another.
To provide platform for faster decision making, especially in
relation to the impact on the costumer.
To allow the project to concentrate on delivering the product to
the costumer, by moving some of the day-to-day issues to the
functional organization.

Advantages to be gained for the engineer working in a matrix

organization;
Experience is gained of working in a function and in a project
The engineer can learn from the various managers.
Appraisals and promotions are based on the input from two
managers, so they are more likely to be related to merit rather than
the whim of individual managers.
It is easier for the engineer to move between jobs.

THE INFORMAL ORGANIZATION

Formal Organizational Structure
DIRECTOR

MANAGER A

MANAGER B

MANAGER C

MANAGER D

THE INFORMAL ORGANIZATION

Informal Organizational Structure
DIRECTOR

MANAGER A

MANAGER B

MANAGER C

MANAGER D

PRESSURES FOR ORGANIZATIONAL

CHANGE
Takeover

Markets

New investment

Leavers

Customers

Promotions

Technology

Competition

New recruits
Career moves
Economics

Legislation

Suppliers

BARRIERS TO CHANGE

The inertia within the organization, caused by the norms that have
been operating over several years. Norms are shared values within
the organization and they prevent its employees from accepting that
a different set of values, resulting from the change may be better.

Employees feel threatened by the change. Managers may also feel

that the change will result in loss of control over some of their staff
and a reduction in their status.

Employees may feel that they are no longer in control of their own
career paths.

BARRIERS TO CHANGE

There could be uncertainty about future roles. Employees may feel

that they would no longer have a meaningful job in the new
organization.

Employees who are put into a new role by the change may feel that
they would not be able to cope.

Past experience within the organization often determines future

behaviour.