Project Organizational Structure of Highway Contractors

The transport project has specific characteristic, thus, project organization structure in the highway construction is more specific than any other projects. At present, almost transport projects have many problems in quality, delay, over budget, environmental impact, traffic safety, etc. Some of the major causations come from the project organizational structure. Project cannot run smoothly and efficiently in case its structure is not effective. In fact, there are some common problems relating to project organizational chart as follows:

·  The project organization structure is not flexible enough for project staff some employees did not meet the assigned requirements.

·   Role and accountability were not clear and detailed enough. In many cases, the staff members are ambiguous about what issue they needed to solve by themselves and had accountability for their decision making. Besides, some decisions were not made in timely manner. These affected so much to the efficiency and effectiveness of the project.

·   Sometimes, the coordination within the company department; or the communication between the company and the project management office (PMO) on site are not close and smooth. It takes risk of interruption and brought the potential risks for the project.

·    There are some traffic accidents happened on the construction site because the PMO only focused on the construction safety, and did not pay attention to the traffic safety. When the traffic accidents happened, a lot of legal issues arise and affected so much to the company as well as project.

·   The reward system and training program are not given importance. This limits the staff motivation and competence enhancement.

Understanding the organization issues and finding out the appropriate solutions are the best ways for enhancing the project's success and the employee's competence as well as contributing to the sustainable development of the company.

Mr. Pham Hai Chien made a case study on National Highway No.51 Project aimed to: (i) study organization and project structure for a highway construction project; and (ii) Make recommendations for improvement of weaknesses, problems and obstacles.

Conclusions

By focusing in in-depth analysis of the organizational structure of the contractors, who undertook to deliver the 13^th and 14^th packages of the national highway No.51 project, ​​the report demonstrated the importance of organizational structure to the project performances. Simultaneously, the report clarified the key factors affecting the project structure and the specific solutions that managers need to keep in mind when designing an organizational structure as follows:

1. Roles and accountabilities.

The report indicated that the role and responsibility are the fundamentals in organization structure. The organizational structure can only work perfectly based on the roles and accountabilities which are clarified in detailed, comprehensive and clear. If not, many conflicts might happen during the operation of the organization and project. Thus, the goals and objectives of the company and project cannot be achieved.

2. Coordination and cooperation.

Coordination among departments and between the staff members always matters, which the company must concerned about. There are many factors affecting the coordination and cooperation, and one of the factors is the organizational structure. Each organizational structure has its own strengths and advantages. Therefore, depending on the characteristics of each project, the organizational structure needs to be designed and set up in order for the departments and individuals to coordinate and cooperate most effectively. The report demonstrated why the matrix structure is a typical example that is often

3. Project governance.

Beside a good project structure, the project governance is also very important to ensure the success of the project. The report pointed out that transparency, clear structure, clear role and accountabilities are the important factors in the project governance. Additionally, it is necessary to apply four key principles of project governance to ensure that project governance is more effective and efficient.

4. Problems and obstacles occurring within the structure.

Based on the weaknesses of the project structure, the report analysed in-depth the core problem occurred. These are typical problems which the traffic projects often encounter. Beside some solutions are supported by the theoretical framework, some other solutions come from the experience of the PMO. The traffic contractors can apply these experiences to manage the future project more successfully.

5. Lessons learnt from the strength and weakness.

There are many other lessons learned during the construction process, but this report only focuses on the basic lessons relating to organizational structure has been and will happen in the key traffic projects such as the national highway No.51.

Recommendations

The construction companies need to pay special attention and must consider the following recommendations when designing an organizational structure of own business in order to achieve the agreed strategic objectives.

1. Set up the good structure according to the right policy and strategy.

When the economy falls into a spiral of crisis, the companies often tend to change the business strategies in order to adapt with the crisis and to overcome difficulties by restructuring the organizational structure following the new business strategy. This is because the structure is the skeleton of an organization or a project. In case that is a good project structure but does not match the right policy and strategy of the company, the structure cannot run smoothly. In contrast, a good structure in accordance with a failure business strategy of the enterprise does not still ensure the project success. Two factors always interact and complement each other as a precondition for the success of the project.

Set up the project structure based on characteristic of each project with careful consideration. The previous project structure is only a consultation, not a final choice. After that, analyzing in-depth, incessantly monitoring and revising the project structure to ensure that it always follows the current policy and strategy of the company.

2. Appoint the right person to the right position.

People are the heart of all issues. Until now, the personnel activities are never easy for any enterprises. While choosing a good staff is too difficult, appointing them to the right position for maximizing his ability is never simple.

Based on a good recruitment process, the advanced training programs, the clear, detailed and comprehensive personnel policies, transparency, and the effective enforcement of the personnel policies, the firms will hold a huge advantage in the operational activities and the project delivery.

3. Set up and enforce effectively and efficiently the project governance.

i. Jean-Daniel Gerber (2004) stated that “Good governance doesn’t fall from the sky; it must be learned, practiced and enforced”.

ii. A successful project needs the effective project governance. There are many perspectives, approaches, and structures in the project governance. Base on the organizational structure and policies of the company, the firms should set up an appropriate project governance structure, then apply and enforce them effectively to achieve the required objectives.

4. Attach special importance to the traffic safety.

i. Vietnam is one of the countries with the higher rate of traffic accidents in recent years due to severely degraded transportation infrastructure, while the awareness of the traffic participant is still poor. Moreover, the contractors of the traffic project usually do not pay attention to traffic safety for vehicles circulated on the project. Therefore, most of the traffic projects often occur some serious common traffic jams and traffic accidents. Many contractors have been sanctioned, even prosecuted criminal.

ii. Setting up a good safety team; establishing a detailed and comprehensive project safety plan; and enforcing efficiently the safety plan are the best solution that the traffic contractor needs to follow in order to achieve more the project’s success and avoid the legal issue because of the traffic accidents.

5. Doing right at the beginning makes a good ending.

i. In the field of management, doing right at the beginning, doing right from the smallest things are the key to success, however it is not easy to take. For instance, in all stages of project implementation, or in case the important issues need to be executed immediately, the commencement meeting is extremely important. The opinions and reviews in this meeting are as a basis for doing right at the start, minimize the potential risks during the implementation in the future. The final reported meeting is also essential to assess the results of implementation and draw experience for the upcoming projects.

ii. Trying to do right at the commencement, trying to do right from the smallest are the best way for the companies and the project managers towards the fully satisfactory results.

Finally, there are no any theoretical frameworks, or solutions to be accurate in all cases of the organizational structure. However, the analysis and recommendations in this report that are fundamental approach for any construction companies can be applied in a flexible manner through the specific characteristics of the business, or the projects. Understanding this approach, the firms will be easier and more successful in designing their own organizational structure.

His thesis abstract is copied and pasted.

Abstract

Vietnam has maintained an impressive growth in infrastructure and its services since the early 1990s, especially in transport network development. After becoming a member of the World Trade Organization, the Vietnamese firms face to not only their domestic competitors but also the foreign companies. One of the most critical factors decreased the competitive competency of Vietnamese firms came from organization structure and design. This final report focused on the project organization structure of the highway contractor. According to the organization theory from literature review, this report analyzed how the organization theory is applied in the real project of Vietnam national highway No.51 as well as addressed the problems and obstacles occurring throughout the project. Some lessons learnt from project and recommendations are discussed in order to help the project managers to improve their project management competency in term of the organizational structure.