• Project Management in project-driven organizations is mature and respected. On the other hand, in non-project-driven organizations, Project Management is still in its infancy, and is often looked at with skepticism.
• Project-driven organizations make the lion’s share of their income through projects, non-project-driven organizations mainly make their income through production.
• The Project Manager is responsible of the profitability and loss in project-driven organizations. In non-project-driven organizations, the responsibility for profitability and loss is ambiguous.
• Project-driven organizations adopt either fully projectized or matrix organizational structures. Non-project-driven organizations usually adopt a functional organizational structure.
• Project-driven organizations have flexible career paths, where one can ascend quickly to higher positions. Non-project-driven organizations have traditional career paths, where moving upwards in the company ladder is very difficult. Quite often, one has to wait for his manager to get fired/resign/retire/die to ascend the company’s ladder and assume a better position.

Examples of industries where project-driven organizations are predominant include:

• Construction
• Aerospace
• Research

Examples of industries where non-project-driven organizations are predominant include:

• Manufacturing
• Services
• Farming
• Natural resources

IT (Information Technology) organizations (that fall under the services industry) are considered to be hybrid, where parts of such organizations are considered to be project-driven (such as the development of a new software), while other parts are considered to be non-project-driven (for example supporting applications).

Advantages

• Employees do not report to multiple managers. Each employee will report to his direct functional manager. This will reduce communication channels.
• Employees tend to learn from each other since those with the same specialty (or set of skills) are grouped together.

Disadvantages

• No one “manages” a certain project, a project is managed by multiple functional managers, this can lead to the following:
  • The client is not able to know what the status of the project really is, as no one can give him the whole picture. Each functional manager is able to report on his part of the project.
  • Conflicts between functional managers can have drastic effects on the progress of a project.
• Employees tend to spend a significant percentage of their time with nothing to do, sometimes literally begging for work.

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