The first two steps of any successful project are setting clear goals and objectives and securing a commitment from all key stakeholders. The lack of commitment and goals at the start of a project can lead to confusion and even conflict within the team. The project hierarchy is one of the best project management styles to use to avoid these issues. This methodology requires project managers to classify key players, objectives, and tasks at the beginning of the project. Keep reading to learn more about what project hierarchy is and how it works.
What is project hierarchy?
Project hierarchy is a process of arranging project tasks and groups by their importance. Project managers visualize and document this process with a flowchart model with the most important tasks or groups at the top of the chart and the least important ones at the bottom. When project managers use the project hierarchy, they analyze all crucial elements of the project at the beginning of the process.
The project hierarchy ranks all key players by levels of importance within the project. The most common level of the hierarchy of management includes:
- Project owner: The project owner is at the highest level of the project hierarchy model. This is the team member who develops, implements, and oversees the project. Typically, they have the power to select the team, set tasks, and make changes in accordance with project goals and objectives.
- Project sponsors: Project sponsors are the team members providing financial resources for the project. They work directly with the process owner and project managers to discuss project goals and objectives and secure required project resources.
- Project managers: Project managers are lower-level members of the team. They are not responsible for setting the overall project goals and objectives. They do, however, break these larger tasks down into smaller, more manageable steps and oversee the day-to-day progress of the project.
- Team leaders and team members: Team leaders and team members are at the lowest level of the project hierarchy, in that order. They report directly to the project managers.
To understand exactly what the project hierarchy is, it can helpful to know how it works within the project management model.
“Project hierarchy” is a part of our Project Management Glossary — check out the full list of terms and definitions!
How project hierarchy works
For any project to produce successful results, it’s crucial for all levels within the team to have a clear understanding of all goals and objectives. The project hierarchy helps with this process by requiring managers to not only set clear goals and objectives from the start but also break these objectives down into smaller tasks and groups based on levels of importance.
There are three main objective levels, along with a fourth less commonly used but vital one.
Policy objectives are the first level of the project hierarchy. These are the broad goals and objectives set by senior management who can make data-driven decisions. All subsequential objectives must align with these policy objectives to ensure the final success of the project.
The second level of the project hierarchy is the strategic objectives. Middle management team members use the policy objectives to create individual components that work together to complete the goals of the project.
At the third level of the project hierarchy, project objectives break components into more manageable tasks. These objectives are set by team members working at the operational level within the company and relate directly to the project deliverables.
While not always included in the project hierarchy design, input objectives play a valuable role. These objectives are set at the operational level and focus solely on securing the resources required for the project.
When creating a hierarchy of objectives, teams should account for project dependencies. In other words, team members must account for tasks that rely on the completion of other tasks when determining levels of importance.
The project hierarchy model follows a why-how framework. As you look at the hierarchy flowchart, you can notice that the objectives answer ‘why’ questions as you move up the hierarchy model. On the other hand, the flowcharts answer ‘how’ questions as you move down the chart. This why-how relationship is key to using the project hierarchy in the project management process.
The role project hierarchy takes in project management
The primary purpose of project hierarchy is to clarify project goals, objectives, and requirements and to effectively communicate these project components to all team members.
It also defines roles for all team members. There are numerous benefits of using the project hierarchy within the project management process, including:
Sets clear lines of communication
One of the best benefits of a project hierarchy is that it establishes lines of communication for all team members. Right from the start of the project, all key players know exactly who is responsible for various aspects of the project. This level of communication can help to reduce confusion among the team and to ensure all managers and team leaders are working towards the same goals.
Another benefit of a project hierarchy is that everyone knows what their responsibilities are and who they report to, which keeps everyone on task. This methodology gives project owners, project sponsors, and project managers a clear view of the status of the project.
A project hierarchy focuses on deliverables. Since the team breaks each step down by levels of importance and keeps project dependencies in mind, this methodology can minimize unnecessary delays and speed up the final delivery process. Additionally, the fact that main objectives and supplemental objectives are set from the start keeps the team solely focused on meeting end results.
While a project hierarchy can drive faster and more efficient results in some cases, it may not be the right management style for every project. It’s important to understand when it’s appropriate to use project hierarchy and when it’s not.
When you should develop a project hierarchy
The project hierarchy is an ideal project management style to utilize when there are existing management levels in place or if clear management levels are necessary for project success. It’s also best for projects with well-defined specifications from the start. This allows team members to create a project by setting up all required components from the beginning.
On the other hand, this management style may not be ideal for projects that require flexibility. Making changes in the middle of the project can be difficult because any change must work through all levels of the hierarchy chart. Additionally, the project hierarchy methodology can hinder innovation because it minimizes communication between levels.
You can better understand when to use a project hierarchy by seeing an example of how it works.
Examples of project hierarchy
Robert Youker, an experienced project management consultant, provides a well-known example of a project hierarchy. In his example, a company wants to increase industrial production. The team breaks this project down into the required objective levels, including:
- Policy objective: This high-level objective is to increase the company’s industrial production.
- Strategic objective: The strategic objective should be more specific, such as producing a set amount of power (i.e., 50 kilowatts in Youker’s illustration).
- Project objective: Using the ‘why-how’ framework mentioned above, an effective project objective for his example is to build a new power plant. The specifications of this project objectives align with the strategic objective to build a power plant that can produce at least 50 kilowatts of industrial power.
- Input objective: In his example, input objectives, such as labor requirements, land deals, and construction-related contracts, help the team secure the necessary resources.
Before developing a project hierarchy system, it’s important to have the right tools and technologies in place. Our monday.com’s customizable tools help teams stay organized and our work OS platform utilizes advanced technologies, including machine learning and artificial intelligence, to streamline the project management process and deliver efficient results.
Creating a project hierarchy system with monday.comOur monday.com Work OS platform and customizable templates can help make setting up a project hierarchy system quick and easy.
First, our monday.com Organizational Plan Template allows you to create layered objectives for each step of the project hierarchy process. With this customizable template, you can easily assign tasks within various objective layers, identify risks, and track project progress. Our templates also integrate with Excel and other applications to allow for a digital transformation of data.
Secondly, you can also set up multi-level boards that provide functionality at each level of the team. For example, our high-level boards are ideal for project owners and project sponsors. These boards provide an overview of projects in progress so these key players can quickly stay updated at all stages of the development process. Low-level boards, on the other hand, can track project objectives and allow project managers to assign tasks, track budgets and set timelines.
Frequently asked questions
What is a project hierarchy?
A project hierarchy is the process of sorting project objectives, groups, and tasks into various levels of importance. Most project managers use a work flowchart that places the most important components at the top of the chart and the least important ones at the bottom.
How do you create a project hierarchy?
To create a project hierarchy, you can start by separating project objectives into three or four layers based on importance. As you move down the hierarchy, you can break these objectives down into smaller, more manageable tasks. Then, you can assign these tasks to various team members based on levels within the organization, skills, and capabilities.
Create an efficient project management process with a project hierarchy
A project hierarchy can be an efficient project management methodology when clear authoritative levels are in place. With this management style, you can specify levels so that the team knows who is responsible for which aspects of the project and who reports to who. This process can avoid confusion and speed out the project completion process.