Project Based Organizations: Strengths & Weaknesses

Abstract: Background: Today companies operate in a market that increasingly is becoming global, and where technological development is advancing ever faster. Global competition, shorter product life cycles and constant reorganization of business puts increasing demands on companies and projects that are under their control. As a result of this trend more and more organizations in different industries are working on a project basis. Objective: To identify and address the strengths and weaknesses of project based organizations. Boundaries: Three business units within different companies will be analyzed in order to deduct a conclusion to the research question. Method: A qualitative method has been used. The empirical material was analyzed based on theory. Results: A project based organization promotes higher flexibility in comparison to a functional organization. The organizational structure of a project based organization provides employees with interesting tasks and the possibility to work in and learn from cross functional teams. Although this has a negative impact on ones work life balance. A key weakness is the organizational integration, which includes: knowledge management, implementation of strategies and focus beyond projects, resource coordination and human resource management. Proposal for further research: An in-depth study on how project based organizations promote innovation.