Project organization is suitable for enterprises that carry out multiple projects at the same time but do not produce standard products. Common in some companies involved in large-scale projects, such as construction, aerospace and so on.
Examples of project enterprises: design institutes, contractors, supervision companies, project management companies, consulting companies, highly dispersed manufacturers, etc.
Examples of internal departments of enterprises: new product R&D institutions, IT departments and infrastructure departments. Examples of government or other institutions: municipal development institutions, national defense and military project development institutions, research institutions, etc.
In a project-based organization, every project runs like a micro-company. All the resources needed to achieve each project goal are fully allocated to this project, which is dedicated to this project. Companies that adopt project-based organizations do not produce standard products, but their business is projects. Full-time project managers have complete project power and management power over project teams (in functional organizations, project managers can have project power, but functional managers still retain management and technical power over staff assigned to projects). Because each project team is strictly committed to a project, the project organization is established to respond to the project objectives and customer needs quickly and effectively. No matter from a single project or the whole company, project-based organizations are inefficient in cost. Each project must provide salaries for team members who specialize in their work, even if their work is easy at some stages of the project. In a project-oriented organization, in order to maximize the use of project resources and ensure the smooth completion of the project within the budget, detailed and accurate planning and effective control systems are needed.