After reading this article you will learn about:- 1. Concept of Project Organisation 2. Need for Project Organisation 3. Advantages 4. Limitations.

Concept of Project Organisation:

When an already existing organisation finds it difficult to cope up with the new situations, it decides to launch a project organisation. In order to accomplish the project goals, a separate division is created for each project.

Project organisation is created when the project is big in size and subject to high standards of performance. A project organisation is solely responsive to the planning, design, development, production, evaluation, and support of a single system or product.

A project organisation is time limited, directly oriented to the life cycle of that system, and the commitment of the varied skills and resources required is purely for the purpose of accomplish­ing system tasks. A project team is created consisting of specialists from different departments of the existing organisation. The specialist of each department gets the services and support of its members as and when required.


The activities of the project team are co-ordinated by the Project Manager. The project team which consists of the best talent is meant to achieve a specific and complex undertaking within time, cost and/or quality parameters.

In brief, the project structure is a vehicle for bringing specialised people together in flexible groups for as long as a particular need exists, but no longer. The project structure reduces the inflexibility and inefficiency of traditional organisation structures in which permanent departments tend to remain even after they have outlived their utility.

Need for Project Organisation:

Running enterprises go for project organisation if:

(1) The project is a onetime task with well-defined specifications and the firm wants to continue to concentrate on its regular activities.


(2) The project presents a unique or unfamiliar challenge.

(3) Successful completion of the project is critical for the enterprise/organisation.

(4) The project is to be completed within the given time limit.

Simplified Pure Project Organization

Advantages of Project Organisation:

(i) It does not interfere with the existing organisation.


(ii) It provides concentrated attention that a complex project demands.

(iii) It allows maximum use of specialists available in the enterprise.

Limitations of Project Organisation:

(i) Project manager has to deal with persons of varied nature and interest.


(ii) Every one working in the existing organisation is attracted to the projects.

(iii) Since work differs from project to project, experience gained in one project may not be relevant to other projects.

(iv) Project work being temporary, there is quite uncertainty and insecurity of job for specialists hired from outside.

(v) Decision-making is very difficult because there are unusual pressures from specialists from diverse fields.


(vi) There may be conflicts among the specialists.