CONSTRUCTION PROJECT

ORGANIZATION
CONSTRUCTION COMPANY
A construction company can be defined as a group of people
sharing specialized knowledge to design, estimate, bid,
purchase and obtain resources to complete a construction
project.
COMMON FUNCTIONS OF
CONSTRUCTION COMPANY
General administration
Managing contracts and personnel
Estimating
Design
Engineering
Purchasing
Accounting
Management of Field construction
 ORGANIZATION
arrangement of the persons in any business so that
they act as one body and work together towards a
common goal.
 THE EFFICIENT FUNCTIONING OF THE
ORGANIZATION IS POSSIBLE WHEN:
Competent and right types of persons are selected and placed in the
right place.
Every member of the organisation who knows the goal of organization
Every member of the organization knows his duties and responsibilities in
achieving the common goal.
Every member is delegated authority and power adequate enough to
enable him to take the decisions for discharge of his responsibilities.
There is proper coordination among different members, departments.
 CHARACTERISTICS OF GOOD
ORGANIZATION
t must have an organizational goal
It must have setup of persons incharge of different branches in
organization
It must specify the functions and activities of every individual of the
organization
Duties, ower and responsibilities of each individual should be clearly
defined.
There should be higher up authority to direct and co-ordinate activities
of different individuals, branches of the organization.
 CHARACTERISTICS OF GOOD
ORGANIZATION
t must have an organizational goal
It must have setup of persons incharge of different branches in
organization
It must specify the functions and activities of every individual of the
organization
Duties, ower and responsibilities of each individual should be clearly
defined.
There should be higher up authority to direct and co-ordinate activities
of different individuals, branches of the organization.
 FUNCTIONS OF ORGANIZATION

Long term planning

To prepare structure of organization
To maintain good relations with the government
To prepare wage policy
Coordination of various departments and their control
To monitor various activities and progress
To ful-fill management aims and development of management
To establish good relations between workers and the management
 PRINCIPLE OF ORGANIZATION
Unity of command
Span of management
Delegation of authority
Unity of job assignment
Division of work
Job definition
Contact
Ultimate authority and responsibility
Continuity of activity
Flexibility and stability
Motivation and professional growth
 UNITY OF COMMAND
Under this principle, each employee knows clearly to whom he is
answerable and whoa re answerable to him
 SPAN OF MANAGEMENT
The span of the management is the small number of workers which a
manager has to supervise.
The number of subordinates that a supervisor can control depends
upon-
Capacity of individual to work
Nature of work
Place of work
Definite and clear responsibilities
The ratio between supervisor and subordinates may vary from 1:4 to 1:5
at higher level management and 1:15 to 1:20 at lower level
management.
 DELEGATION OF AUTHORITY
With the allocation of duties and responsibilities, necessary authority
must also be given to the individual so as to enable him to perform his
duties.
In order to have effective control it is necessary to fix responsibilities of
all concerned by the higher management
Whenever a person is assigned any task, he should be given sufficient
powers to achieve his task, thus the authority and responsibility both go
together.
 UNITY OF JOB ASSIGNMENT
Functions of similar jobs in different departments should be closely
related within the structure of organization.
Functions assigned to each position should be adjustable and they
should require reasonably equal demands of skill
While assigning the job, following points should be kept in mind.
Assignments for an individual should be few in number and
similar
Assignments of same nature in different departments must be of
same skill so that workers may be interchanged
An individual should be assigned only one job at a time
 DIVISION OF WORK
The work should be divided into small parts and suitable job should be
assigned to suitable person
 SEPARATION OF WORK
The job of inspection and control should be assigned to those persons
who are not associated with that work.
There should be an arrangement in the organization to identify mistakes
and to suggest remedial measures.
 JOB DEFINITION
The work amongst the workers should be allotted very carefully on the
basis of their skill experience and ability to do that work.
For work purpose department must have following information for
identifying the job
Name of the job
Code number of the job
Grade of the job
Particular shifts
Jobs relationships
Name of department and the section in which the job is to be
performed
 CONTACT
The organization should allow complete coordination of each branch of
work
The performance of each worker of every unit should be economically
related to all units keeping in view the policies of the organization.
 ULTIMATE AUTHORITY AND
RESPONSIBILITY
For all the acts of subordinates, higher officials are responsible.
When a superintendent assign some job to their subordinate and
subordinate commits some mistake, for that mistake the superintendent
is held responsible.
 CONTINUITY OF ACTIVITY
The structure of organization should be dynamic
It should not only confine the activities in achieving their goals but also
continue such activities in future.
It should establish a link between the past and the future
 FLEXIBILITY AND STABILITY
The organization should be flexible to allow some changes and
expansions etc. where ever necessary and it should be capable of
adjusting its urgent demands.
A good organization should be capable ot control wastage of labor,
money and material
 MOTIVATION AND PROFESSIONAL
GROWTH
The structure of organization should be such that their employees gets
sufficient opportunities for their growth.
It should encourage the employees for their best performance
The employees should get satisfaction in their job
STRUCTURE OF CONSTRUCTION
ORGANIZATION
The organizational structure indicates the arrangement of different
departments and the division of labour
It refers to the organization and administrative patterns.
It is about how to use one of the basic resources, people and how to
facilitate overcoming of the communication barriers at organizational
interfaces.
 TYPES OF STRUCTURE OF
CONSTRUCTION ORGANIZATION
Depending upon the manner in which the authority and responsibilities
in an organization are distributed, the structure of construction
organization at corporate level can be divided into two categories
Line or military organization
Line and staff organization
 LINE OR MILITARY ORGANIZATION

This type of organization is based upon earlier military formation

As in army, commander in chief has full control over the entire army of
the country through his major generals and area commanders and so
on.
Exactly the same pattern is followed in line organization
ADVANTAGES OF LINE ORGANIZATION

It is simple to work and easy to understand by the employees

It permits quick decisions
It is most effective and economical
It provides strong discipline
 DISADVANTAGES OF LINE
ORGANIZATION
As the top executive hast o perform many duties, the progress of work
may suffer as he is left little time to look after the progress of the work.
The organization is rigid and inflexible
Top executive and key men are overloaded
 LINE AND STAFF ORGANIZATION

The line organisation is not suitable for large and complex enterprise
undertaking large construction works and heavy projects, where key
men need advice from expert specialist in different fields
These specialist who constitute the staff in the organization are experts
with long experience
 ADVANTAGES OF LINE AND STAFF
ORGANIZATION
Advice of expert specialist is available
The project can be executed with better quality product
It gives increased economy and efficiency though extra expenditure
has to be incurred on staff experts.
 DISADVANTAGE OF LINE AND STAFF
ORGANIZATION
The staff may be ineffective for lack of authority to carry out its functions
Possibilities of conflict between line persons and staff are there as the
responsibilities and authority are not well defined
 ORGANIZATION FOR
PROJECT MANAGEMENT
In a construction company the organization at project level and at
corporate level is not the same
The primary function of a construction company is to execute
construction projects
The function is performed by companies following different
organizational structures at project level.
 PROJECT MANAGEMENT STRUCTURE

Functional organizational (classical)

Matrix organization
Pure project or product organization
 FUNCTIONAL ORGANIZATIONAL
(CLASSICAL)
The basis of a functional organization is specialization
In such an organisation work is carried out in a functional basis and
each function is carried out by specialist
According to F.W. Taylor, the ideal situation in such an organization
would be when each person performs a specified function only.
 FUNCTIONAL ORGANIZATIONAL
(CLASSICAL)
The basis of a functional organization is specialization
In such an organisation work is carried out in a functional basis and
each function is carried out by specialist
According to F.W. Taylor, the ideal situation in such an organization
would be when each person performs a specified function only.
 ADVANTAGES OF FUNCTIONAL
ORGANIZATIONAL
In this type of organization expert advise is available through specialists
The entire work is divided in the basis of functional specialization
Quality of work is enhanced due to specialization
 DISADVANTAGES OF FUNCTIONAL
ORGANIZATION
There is no clear cut line of authority
Coordination is difficult
It is difficult to fix responsibility
Overhead costs are increased due to a number of specialists
 MATRIX ORGANIZATIONAL
In this type of organization strong and god points of line and staff
organization are retained
It divides the power into functional and project responsibilities
In this type of organization the conflicts between the line personnel and
staff personnel are minimized, by opening up lines of communication at
all levels through the assignment of dual reporting responsibility to the
subordinate managers
 ADVANTAGE OF MATRIX
ORGANIZATIONAL
This type of organization removes some of the weakness of line and staff
organization
This pattern is best suited in case the project authority and functional
authority is well defined and clearly divided.
The structure facilitates quick response to changes, conflicts and project
needs
 DISADVANTAGE OF MATRIX
ORGANIZATIONAL
Overall management and administrative cost will be higher
It is difficult to precisely define the accountability of the functional and
project managers
Initially more effort and time is needed to define policies, procedure,
responsibilities and authority relationships
 PURE PROJECT/ PRODUCT
ORGANIZATION
Pure project can be formed to support a steady flow of ongoing
projects
In this type of organization, employees are grouped by project
The majority of the organization's resources is directed towards
successful completion of projects.
 ADVANTAGES OF PURE PROJECT

The project manager has complete control over the project

The lines of communication are strong and open
The system is highly flexible and capable of rapid reaction times
The project is the only real concern of the project employees, It brings
together all the administrative, technical and support personnel
needed to bring a project from the early stages of development to
operational use.
 DISADVANTAGES OF PURE PROJECT

There could be a duplication of efforts

The administrative duties of a project manager may be demanding
and the job could be quite stressful
It is difficult to find a project manager having both general
management expertise and diverse functional expertise
 MANAGEMENT LEVELS
Management level can be defines as a position in management that is
differentiable in terms of power, authority, responsibility and
accountability over resources required to achieve defined objectives
Five Management Levels
Director level
President level
Construction management level
Project management level
Functional management level
 DIRECTORT LEVEL
The different functions at this level are
Setting plans
Formulatiing objectives
Deciding among different courses of action
Company’s financial status
Competitive information
Environmental information
 PRESIDENT LEVEL
The primary functions at this level are acquiring business and
formulating the company’s immediate objective, in line with the board’s
plans and strategies.
This level requires a much more detailed information regarding
competition, environment and financial status.
CONSTRUCTION MANAGEMENT LEVEL
The main functions at this level are obtaining and monitoring work for
the company at the district/divisional level.
This level requires summary formats of the three basic types of
information. I.e. environmental, competetive and internal
 PROJECT MANAGEMENT LEVEL
The main functions of this level are-
Managing the day to day operations of all aspects of a project
Watching closely the development of the project as a group
This level also requires summary formats of the three basic types of
information, i.e/ environmental, competetive and internal.
 PROJECT MANAGER
Present day construction projects are becoming more complex and
constantly as compared to previous times
This complex nature places a heavy demand on the management skill
of those involved in every phase of the management skill of those
involved in every phase of the management of construction work.
 RESPONSIBLITIES OF CONSTRUCTION
MANAGER
Developing bid proposal
Establishing project organization and staffing
Provide overall leadership to the project team
Profit generation and new business development
Schedules and budgets
Assissting in determining technical and man power requirements
Cooridincating and integrating of sub system tasks
 TRAITS OF A PROJECT MANAGER
Adaptability
This refers to propensity to be flexible where necessary and avoid
rigid patterns of thinking and to adapt to the requirement of the
project, the needs of the sponsors, its environment and people
working on it, He should be adapt to change
Inventiveness
This refers to an ability to discover innovations, strategies and
solutions either from within one self or through interaction with other
members of the project team and to identify ways of working with
disparate resources to achieve the project objectives.
TRAITS OF A PROJECT CO-ORDINATOR
A project coordinator is a person who is responsible for coordination
among personnel of different departments and various stakeholders of
a project.
A typical large multidisciplinary project needs coordination among the
personnel of different departments such as civil, mechanical, electrical,
pland and machinery, accounts, materials, design, quality control,
safety, HRD etc.
 CAUSES OF PROJECT FAILURE
For successful completion of a project, four basis resources (4-M)
required are:
Manpower
Money
Materials
Machinery
The following are the causes of failure of a project:
Improper planning of a project
Defect in the survey carried out before implementation of a project
Excessive increase in the project cost
Sudden increase in materials and labor rates in the market
Defective structural design
Poor quality of construction at site
Use of inferior quality of construction materials
Lack of technical skill of supervisors/engineers
Inexperienced contractor
Insufficient finance with the contractor
Insufficient plants, equipments, and manpower
Poor relations among owner, engineer, and labors
Lack of coordination between various departments like
administrative, engineering, account, material store etc.
Inadequate water, electricity and approach road
Change in government policies/laws
THANK YOU