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Organizational Structure in Engineering

A growing engineering firm needs an organizational structure that aligns with its size and business strategy, be it a software, tech development or manufacturing company. Regardless of the scale of a company, the development and execution of its organizational structure is a key part of engineering management.

In an advanced degree program, such as Arkansas State University’s online Master of Engineering Management (MEM), candidates will study the engineering organization structure for businesses of various sizes. The curriculum offers an in-depth look at effective structures and examines the pitfalls of static models.

Organizational Structure Over Time

Engineering management is largely responsible for creating, implementing and updating a company’s organizational structure. This can be a fluid role; startup founders, for instance, often initially direct a company’s product development, business strategy, organization and team management. As companies expand, however, so must the structure of management. Specific roles go to project managers and team leaders to oversee various aspects of the company, such as research and development, product engineering, sales and marketing.

Engineering management roles vary based on a company’s organizational structure; however, management must still support the overall business strategy. Moreover, to maximize efficiency, vertical leaders need to be flexible, so they can evolve as necessary.

Top-Down Stagnation

The basic top-down structural model of a startup company — in which founders and CEOs assume responsibility for all company operations — often remains stagnant even as the company becomes larger and more complex. This can lead to inefficiency and slow growth, as managers will continue to perform roles based on antiquated structures rather than reassigning new duties to those with the qualifications to handle them.

For instance, product developers or design engineers may be poor deadline supervisors, so assigning them these roles in a Top-Down model based on seniority and changing company needs is a poor strategy. These professionals excel in their specific roles, and asking them to work outside their expertise is simply inefficient. A new team leader or project manager can be accountable for staff efficiency, deadlines and performance, freeing specialists to do their jobs.

The Functional Structure

Furthermore, when a company relies on “functional structure” — grouping people with similar skills and knowledge — it assigns managers suited to the needs of those groups. A marketing manager oversees employees who focus solely on marketing. A finance and administration department handles day-to-day financial matters like budgeting, expenses and resources acquisition. A research and development team leader focuses on designing products that align with current and future industry trends to support the company’s development strategy.

An important aspect of this structure in engineering management is that, while all departments are accountable to upper management, each is more effective when given as much autonomy as possible. If a functional manager must run all decision-making through a managerial bureaucracy, overall productivity will suffer.

To whatever extent possible, functional managers should be responsible for decisions that promote the effectiveness of their subordinates. This approach does not eliminate regular, thorough reports to upper management. Instead, the upper levels of engineering management can be most effective if they monitor their departments as units and allow junior managers to concentrate on individual performance. This promotes employee advancement and fosters teamwork.

Improving the Model

Organizational structure in engineering management can be complex. However, there are many functional models for managers to choose from as long as they are flexible enough to restructure their organizations based on growth. Creating varying levels of role-specific management can improve departmental productivity and inter-department communication, as long as upper management does not impose bureaucratic processes that inhibit operations.

An in-depth study of effective organizational structures, such as Arkansas State University’s online Master of Engineering Management (MEM), equips engineering managers with insights and knowledge that they can use to help their companies succeed in competitive engineering industries.

Learn more about the A-State online MEM program.


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