How can a project-based structure align innovation goals and resources?

1 What is a project-based structure?

A project-based structure is a type of organizational structure where work is divided into temporary projects that have specific objectives, deadlines, and budgets. Each project has a dedicated team of people from different functions, disciplines, and backgrounds who collaborate to deliver the project outcomes. The project team is led by a project manager who reports to a senior executive or a steering committee. The project team members may have dual reporting lines: one to the project manager and one to their functional manager.

2 Why use a project-based structure for innovation?

A project-based structure can foster innovation by providing a number of benefits, such as allowing for more autonomy, creativity, and experimentation among team members. This enables faster and more flexible responses to changing market conditions, customer needs, and technological opportunities. Additionally, it facilitates cross-functional and interdisciplinary collaboration and learning, as project team members can draw upon their diverse skills, knowledge, and perspectives. Furthermore, it aligns the allocation of resources and incentives with innovation goals and priorities, as project teams can access the necessary funding, equipment, and support to execute their projects. Ultimately, they are rewarded based on their performance and results.

3 What are the challenges of a project-based structure for innovation?

A project-based structure can also present some challenges for innovation. Coordination and communication difficulties may arise among project teams and between project teams and the rest of the organization, as they may have different cultures, languages, and norms. Additionally, managing multiple and interrelated projects can become complex and uncertain due to competing demands, conflicting goals, and resource constraints. Furthermore, role ambiguity and role conflict may occur among project team members if expectations and responsibilities from their project managers and functional managers are unclear or inconsistent. This type of structure can also cause stress and burnout among project team members due to high workloads, tight deadlines, and frequent changes.