What is a potential drawback of a projectized organizational structure?

A projectized organizational structure is designed to facilitate a strong focus on projects, where project managers have full authority. However, a potential drawback of this structure is that it can lead to higher costs due to duplication of resources and efforts. In a projectized environment, individuals may be assigned to a specific project team rather than being integrated within a functional department. As a result, the same functional roles might be replicated across multiple project teams, which can lead to inefficiencies and increased overhead.

For instance, if multiple projects require similar skill sets or resources, each project might recruit its own team, resulting in redundancy. This duplication not only drives up costs but can also lead to inconsistencies in performance and quality since different teams may approach similar tasks differently without centralized oversight.

This contrasts with functional structures, where resources are shared across various projects, promoting efficiency and potentially reducing costs. Hence, the cost implications of having distinct teams for various projects make this a significant consideration when evaluating projectized organizational structures.