UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business ------------------------------ NGUYEN ANH KHOA INEFFECTIVE PROJECT SCHEDULING AND TIME CONTROL IN SUN VIET JSC MASTER OF BUSINESS ADMINISTRATION Ho Chi Minh City – Year 2018 Page 1 of 56 TIEU LUAN MOI download : skknchat@gmail.com UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business ------------------------------ NGUYEN ANH KHOA INEFFECTIVE PROJECT SCHEDULING AND TIME CONTROL IN SUN VIET JSC MASTER OF BUSINESS ADMINISTRATION SUPERVISOR: Dr. NGUYEN PHONG NGUYEN Ho Chi Minh City – Year 2018 Page 2 of 56 TIEU LUAN MOI download : skknchat@gmail. Symptom and evidence. Initial causes-effect map.
Updated causes-effect map. Potential central problem. List of real causes. Final causes-effect map.
Summary of finding from qualitative research (first interview). Group of causes and variable base on result of interview (first interview). Analysis the number of time overrun projects in 2017 by factors. Result of SVTECH’s control system measurement.
Transcript of problem discussion (third interview). Result of causes evaluation .55 Page 3 of 56 TIEU LUAN MOI download : skknchat@gmail.com List of figures Figure 1. Initial Causes-effect map (source: in-depth interview). Updated causes-effect map (source: in-depth interview and the above literatures).
Finial causes-effect map (source: in-depth interview and the above literatures) .27 List of table Table 1. KPI of Company in 2017 (source: SVTECH’s data). Relationship between factors and variables in causes-effect maps (interview and above literatures). Result of adding interview (source: second interview).
Percentage of over time cost to revenue in 2015-2017 (source: SVTECH’s data). Group of causes (source: literature review). Summarizing of causes evaluation. Summary of finding in first in-depth interview (source: first in-depth interview).
Group of causes and variable (source: first in-depth interview). Number of time overrun project summarized by main factors (source: SVTECH’s data). Time in plan and actual time to finish project in 2017 (source: SVTECH’s data) .48 Page 4 of 56 TIEU LUAN MOI download : skknchat@gmail.com EXECUTIVE SUMMARY SVTECH had problem in deploying project in 2017. The proportion of time overrun projects and number of delayed day rose significantly.
They leaded to complaints from customers, probability to face with liquidated damages penalty and increase cost because of overtime cost. More seriously, SVTECH could be lost customers for competitors if the time overrun project do not be solved. By making interview, literature review and analyzing the data in 2017, ineffective time control system was found that the central problem caused to the time overrun project. In order to solve this problem, deeper interview and study research was done.
The result of research and interview defined 7 causes of ineffective time control system, which are classified in 3 groups. These causes has been validated and evaluated to define the level of important to company. Based on these causes, alternative solution has been suggested and discussed to find the suitable one for SVTECH. To make clear for the solution, an action plan was made.
This action plan is expected to help SVTECH improve the time control system and decrease the percentage of time overrun projects and number of delayed day. Page 5 of 56 TIEU LUAN MOI download : skknchat@gmail. Company background - Sun Viet Technology Development JSC (SVTECH) was established in 2001 as a distributor of Sun Microsystems, which is one of the biggest technological equipment producers on the world. After 17 years of growth, from 17 employees in 2001 to nearly 200 employees currently, SVTECH has now been acknowledge as one the three leading System Integration companies with large scale and complex projects at both national and regional level.
- There are some significant milestone in 17 years of growth of SVTECH: + In 2001, Head office in Ho Chi Minh City was established + In 2004, be selected as Sun Chanel partner and Hanoi representative office was opened. + In 2006, become partner of Oracle and Celltick. + In 2008, Switched to SV technologies JSC and be selected as partner of Juniper and IBM. In this year, SVTECH also get Honorable Achievement Award for the best storage server provider in South Asia by Sun Micro system, + In 2010, become partner of Hitachi Data System (HDS).
+ In 2012, launched new business categories in Telecom Services and Integration (TSI) and Managed Service Provider (MSP). SVTECH also become partner of Symamtec in 2012. + In 2013, be partner of Vmware + In 2014, be partner of Intel security, Harmonic and achieve Award for the best Technical Vitality Business partner by 2014. + In 2015, achieve Aware for Asean Partner of the year by Juniper, Aware for Top Big Data nad Analytics by IBM and become partner of HPE.
+ In 2016, honored as the best security and risk management by the Asian Banker and become partner of NetApp. - Be partner of the largest technology corporations, SVTECH provide technological services and solutions to optimize the IT system and enhance management system performance. SVTECH’s services and solution can be classified in three main group: Page 6 of 56 TIEU LUAN MOI download : skknchat@gmail.com + System Integrator, included network infrastructure, security, data, business analytics, digital enterprise solution… + Information and Communication Technologies (ICT), include television, IP networking, managed services… + Cloud computing solution. + Besides, to prepare for 4.0 revolution, SVTECH also provides advanced technologies such as Internet of Thing (IoT) solution, Virtualization, Geographic information system (GIS) solution.
- SVTECH provide services and solution to local and abroad organizations. SVTECH customer was divide in to 6 main group: + Telecom corporations include: Mobifone, Vinaphone- VNPT, Viettel. + Government organizations such as Ministry of Finance, Ministry of information technology, EVN, Sawaco, etc. + Financial and Stock Institution was representative by OCB, MB, ACB, BIDV, Vietinbank, Sacombank, Prudential, Viet Capital, FE Credit, ect.
+ Oil and Gas Company include PV oil, PVEP, PV trans. Vietso Petro, Petronas, etc. + Education and health organizations such as Can Tho University, RMIT, National University, Binh Dan Hospita, University of Medicine and Pharmacy Hospital, ect. + Enterprises such as Vinamilk, Vingroup, HTV, SCTV, Big C, Mega Market, etc.
Symptom and evidence - SVTECH built KPI base on Balance Score Card, which includes 4 main categories: Financial, Customer, Process and Learning and growth, to control the performance of company. In 2017, there were 4 KPIs was not achieved objective. They are presented in the below table: Table 1. KPI of Company in 2017 (source: SVTECH’s data) KPI Department Target Result Evaluating Percentage of projects completed on Project >80% 75% Not achieved time management Page 7 of 56 TIEU LUAN MOI download : skknchat@gmail.com Percentage of contracts delivered on Logistic- Not achieved >80% 72% time Purchase Percentage of human response HR 100% 83% Not achieved Percentage of human responded on HR >70% 68% Not achieved time - The KPIs was responsible by HR department was not achieved because of leave maternity in recruitment team.
She came back in March 2018 so the problem has been solved. - Two others unachieved KPIs has relationship and they involve to schedule project control. The result of KPIs show that project schedule was not controlled well, which was effected by late delivery. For instance, project of X company (company name has been changed because of SVTECH’s confidential rules) in March 2018 was postponed for 10 days because of late delivery.
X is a fastidious customer, who always strict on time of project. They always set some penalties in contract to force suppliers comply with time. In order to finish project on time and avoid punishing from X, engineers in technical department had to work overtime. This project has finished on time but cost increased significantly.
- Another case, Y company make an order of storage equipment to replace old system. They have built a plan to postpone working at all branches for system changing but their products was late delivery so they have to cancel plan and set a new plan. They had poor complain about SVTECH’s service because it make their waste a lot of time. They are considering about finding new suppliers instead of SVTECH for next projects.
- These are only 2 typical cases of 27 time overrun projects and late delivery orders in 2018. They lead to cost of project in rise significantly in compare with budget. The amount of cost increase came from paying overtime bonus for engineers, punishing from contract. The time overrun projects and late delivery orders also dissatisfy customer and destroy future opportunity.
Therefore, the time overrun project and late delivery should be analyzed and prevented. This paper will focus on finding the potential problem and root causes which lead to these consequences and offer an alternative solution and action plan to reduce the proportion of time overrun projects to total projects. Page 8 of 56 TIEU LUAN MOI download : skknchat@gmail. Qualitative research - Initially, in order to define the potential problem which lead to the late delivery and time overrun project, a qualitative research has been conducted.
In-depth interview is used to collect depth information about causes of time overrun project and late delivery from the involve people and the interview was taken place in meeting room to ensure the private environment. Because one to one interview method will help respondents felt comfortable and easy to provide accuracy information. - Logistic- Purchase department is main responsibility for this KPIs so Logistic- Purchase Manager was interviewed initially. Besides, Project Management Department is responsible for connecting other departments and Sales Department is responsible to contact with customers, so Project Management and Sales Managers is also need to be interviewed.
The in-depth interview was only taken place with managers because they had enough information about their employees and they could provide the most fulfill and reliable information. Besides, time of research is not enough to interview more people, so this paper consider information from managers is representative for their departments. - In order to get useful information, an interview guide which provide key questions to interview has been prepared (see section 6.1) and the interview has been employed base on this guide. The result of interview was transcript in section 6.2 and summarized by group of causes and variables in section 6.
- After summarizing the interview result, five potential problems, which caused to time overrun project, has been identified. They were indicated by follow initial causes- effect map (Figure 1). Page 9 of 56 TIEU LUAN MOI download : skknchat@gmail. Initial causes-effect map Figure 1.
Initial Causes-effect map (source: in-depth interview) Page 10 of 56 TIEU LUAN MOI download : skknchat@gmail.com - By summary the interview of Logistic-Purchase manager and Project Management and Sales manager, there are four main groups of causes lead to time overrun project: + Late product delivery + Sale require urgent time which lower than standardization of response time + Incident in project + Customer delay project - Firstly, late product delivery is direct causes lead to time overrun project because engineer could not work without products and equipment. More specifically, late product delivery was caused by three issues: + Logistic-Purchase is overload working, they required to recruit new employee to reduce workload but HR department could not find suitable candidate on time because requirements of candidate is high. However, new employee has been recruited when the research took place and late product delivery has not been solved. Therefore, it was not the main problem.
+ Sometimes, projects provide new technologies required new products, which has not been imported before. Therefore, it took time to prepare product certificates. Requirement of new products could not predicted so Logistic- Purchase department cannot require a backup time, so it lead to late product delivery. However, this case was rarely happen and it did not cause to time overrun project because customers always understand for these cases.
+ Finally, late product delivery happened recently because of complicated orders.