What is Organization Breakdown Structure (OBS) in Construction?

What is Organization Breakdown Structure (OBS) in Construction?
Organization Breakdown Structure(OBS) is a structure or hierarchical model of all the distinct roles within an organization, explaining their specific responsibilities and accountability. OBS is a frequently used tool employed to manage the prescribed work structure established within the scope of a construction project.

The construction industry constitutes a range of complex projects and activities that demand adequate expertise and distinctly explained responsibilities. Every element or entity in a construction project has its particular function, so implementing an OBS is necessary to allocate roles and responsibilities. The roles and responsibilities of each entity are defined based on the fundamental objectives of the project, revolving around the business targets.‍

What is an OBS Structure?
An OBS structure represents the process employed for organizational arrangements and how these arrangements would assist in reporting problems related to the construction project. It is an organizational structure based on the responsibilities of different stakeholders in the project.

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Generally, a construction project is a complex operation that involves various segments consisting of different activities. The breakdown and segmentation of the entire construction project are known as Work Breakdown Structure(WBS). The activities assigned in these segments are known as work packages.

OBS has a deep connection with WBS because OBS determines the entity responsible for completing a particular segment in a WBS. This connected process receives assistance from the Responsibility Assignment Matrix(RAM) methodology and assists in defining the scope of the project.

The OBS structure entirely depends on the project objectives, taking into account, the facility provided to the subcontractors, and architectural and technical staff. This structure is prepared every single time by a project manager and comprises alterations according to the project’s complexity, scope and size.

What is the Responsibility Assignment Matrix(RAM) technique?
The RAM technique assigns specific activities or work packages to different project members in a complex construction project. RAM displays the correlations and interactions between the project activities that need to be completed to achieve the project activities and the project members. Each project member has a specific set of skills and expertise. They are assigned different tasks depending on their working potential and field of expertise.

There are other similar versions of RAM such as RACI(Responsible, Accountable, Consultative, Information) and RASCI(Responsible, Accountable, Sign Off, Consultative, Information). Sometimes, the RAM methodology includes cost and is more commonly known as monetized RAM.

How to prepare an effective OBS?
An effective OBS ensures that the roles and responsibilities of individual employees regarding the scope, stakeholders and objectives of the construction project are clearly defined. An effective OBS increases savings, warrants and maintains quality standards and assists in finishing the project on time.

Here are the steps that you must follow to prepare an effective OBS:

1. Firstly, the scope statement of the construction project is defined. An environment is established to manage the project. The management environment helps in providing a convenient set-up for fulfilling the project objectives.

2. Every stakeholder who can influence the project in any possible way is recognized because they can play a vital role in establishing connections between the OBS and WBS.

3. After the project scope statement is defined and the project objectives are displayed, all the project requirements must be documented. The requirements act as the basis for establishing the work packages. All the necessary activities that have to be executed, are identified. These activities are the basis for the work breakdown structure.

4. After preparing the WBS, separate project members are given responsibilities depending on the RAM process.

5. Atlast, WBS is unified with the OBS to create the RAM.

Advantages of OBS
Here are the advantages of the OBS procedure:

1. OBS assists in dealing with several construction project management processes that have to be performed under several restrictions due to various project aspects such as scope, cost and timeline. OBS helps in systemizing human resources effectively and efficiently. It helps in identifying work requirements.

2. Scheduling activities becomes very easy for the management team after the OBS has been established. Any information related to resource allocation is present in the OBS structure. The efforts are also estimated and subsequently reduce the time required for scheduling.

3. After the connection between OBS and WBS is defined, the project scope is visualized more easily. Thus, the project scope is drafted with assistance from OBS and WBS.

4. Construction projects are always prone to hazards and uncertainties. So, the OBS can be implemented to establish accountability for specific risks.

5. OBS highlights the link through which separate project members communicate and collaborate. It subsequently improves communication and enhances the project execution and management process.

6. OBS ensures completion of every project milestone without leaving any deliverables late on schedule or forgotten.

Construction Management with OBS
Organizational breakdown structure helps to manage construction projects more effectively due to its clear framework that displays the roles and responsibilities of every entity. Construction projects are usually complex and it is hard to manage every aspect simultaneously and identify the project members based on their activities.

When every member in a project is aware of their roles and responsibilities, they can work more efficiently. Many safety and risk management methods prescribe the use of OBS to establish and implement efficient construction strategies.

OBS also helps in segregating other structures included in the project that can be used throughout the project duration. Other structures that are broken down based on OBS are resource breakdown structure, cost breakdown structure, risk breakdown structure and feature breakdown structure.

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