Ineffective project scheduling and time control in sun viet jsc

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


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


CONTENTS
1. Problem identification ..............................................................................................6
1.1.

Company background ........................................................................................6

1.2.

Symptom and evidence ......................................................................................7

1.3.

Qualitative research ...........................................................................................9

1.4.

Initial causes-effect map ..................................................................................10

1.5.

Updated causes-effect map ..............................................................................14

1.6.

Potential central problem .................................................................................17

2. Problem justification ..............................................................................................19
2.1.

Problem definition ...........................................................................................19

2.2.

Problem existence ............................................................................................21

2.3.

Problem consequences .....................................................................................22

3. Causes validation ....................................................................................................24
3.1.

List of real causes ............................................................................................24

3.2.

Final causes-effect map ...................................................................................27

3.3.

Causes evaluation ............................................................................................28

4. Alternative solution ................................................................................................29
5. Action plan .............................................................................................................33
6. Supporting information ..........................................................................................37

6.1.

Interview guide (first interview) ......................................................................37

6.2.

Summary of finding from qualitative research (first interview) .....................38

6.3.

Group of causes and variable base on result of interview (first interview) .....47

6.4.

Analysis the number of time overrun projects in 2017 by factors ..................48

6.5.

Result of SVTECH’s control system measurement ........................................48

6.6.

Transcript of problem discussion (third interview) .........................................50

6.7.

Result of causes evaluation .............................................................................53

REFERENCES ............................................................................................................55

Page 3 of 56


List of figures
Figure 1. Initial Causes-effect map (source: in-depth interview) .................................10
Figure 2. Updated causes-effect map (source: in-depth interview and the above
literatures) .....................................................................................................................14
Figure 3. 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) ........................................7
Table 2. Relationship between factors and variables in causes-effect maps (interview
and above literatures) ....................................................................................................15
Table 3. Result of adding interview (source: second interview) .................................16
Table 4. Y (time) of project in 2017 (source: SVTECH’s data) ...................................21
Table 5. Y (time) in three year 2015-2017 (source: SVTECH’s data) .........................22
Table 6. Percentage of over time cost to revenue in 2015-2017 (source: SVTECH’s data)
.......................................................................................................................................24
Table 7. Group of causes (source: literature review) ....................................................25
Table 8. Summarizing of causes evaluation..................................................................28
Table 9. Summary of finding in first in-depth interview (source: first in-depth interview)
.......................................................................................................................................39
Table 10. Group of causes and variable (source: first in-depth interview) ...................47
Table 11. Number of time overrun project summarized by main factors (source:
SVTECH’s data) ...........................................................................................................48
Table 12. Time in plan and actual time to finish project in 2017 (source: SVTECH’s
data) ...............................................................................................................................48

Page 4 of 56

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


1. Problem identification
1.1. 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

+ 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.

1.2. 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)
Department Target
KPI
Percentage of projects completed on Project
>80%
management
time

Result
75%

Evaluating
Not achieved

Page 7 of 56


Percentage of contracts delivered on
time
Percentage of human response
Percentage of human responded on
time

-

LogisticPurchase
HR
HR

>80%

72%

Not achieved

100%

83%

Not achieved

>70%

68%

Not achieved

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

1.3. 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 LogisticPurchase 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 6.3.

-

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


1.4. Initial causes-effect map

Figure 1. Initial Causes-effect map (source: in-depth interview)
Page 10 of 56


-

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 LogisticPurchase 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.
Deploying project need an enormous number of products and equipment, and
they was usually provided by many different suppliers from many different areas
on the world. Therefore, Logistic-Purchase department could receive hundreds
of order for one project. Additionally, these orders was separate by different time
and different contract. While doing A huge number of paper work and too much
steps to complete, Logistic-Purchase department also make many report and
updated schedule of product importing to sale every days so their work was
interrupted lead to low productivity. This problem is defined as main problem
with cause to late product delivery and lead to time overrun project.
Page 11 of 56


-

Secondly, incident in project such as products and system are incompatible, error
in system or software, etc. is also causes of time overrun project. Incident usually
happen with project provide new technologies, and this case was always
understand by customers. However, incidents also caused by delivering wrong
products which was usually lead to time overrun project and was usually

complain from customers. There are some causes lead to delivering wrong
product: Sales misunderstood customer’s requirement, which caused by Sales
have not understood products. Besides, project provide new technologies usually
use new products also a challenge for sales and Purchase- Logistic department
and import wrong product also happen sometimes. Finally, complicated
document and workflow also lead to delivery wrong product because there are
too much document have to check but there was not effective tool to support.

-

Thirdly, urgent time requirement from Sales department was one of causes lead
to time overrun project. Sales usually send requirement in urgent case to engineer
and Logistic-Purchase department to satisfy customer. Deadline to complete
project is to urgent so Technology department could not arrange enough engineer
and Logistic-Purchase department also could not import product on time. There
are standardizations about response time for purchasing and supporting from
engineer, but sometimes, Sales tried to persuade Technology department and
Logistic-Purchase department to admit their requirements because they are
pressure by KPIs of revenue so they have to accept urgent requirement from
customers. Another reason is urgent requirement come from large and important
customers, if companies do not accept their requirements, companies will lose
them and future profit. On the other hand, some sale senior could negotiate with
customer about schedule very well but it’s harder for inexperience sales.
Therefore, some Sales whose weak negotiating skill is the main problem cause
to urgent time requirement and lead to late product delivery and time overrun
project.

-

Finally, time overrun project is also caused by schedule changing from customer,

which come from customer’s internal problem so they did not complete
infrastructure and delay project start day or they did not pay deposit on time, was
Page 12 of 56


could not controlled and it also did not cause to drawback to company. Therefore,
research will not focus on this causes.
-

By analyzing information from interview and discussion with respondents, there
are four potential problems lead to time overrun project:
+ Complicated document and workflow
+ Sales had weak negotiating skill
+ Project provide new technologies
+ Customer delay project.

Page 13 of 56


1.5. Updated causes-effect map

Figure 2. Updated causes-effect map (source: in-depth interview and the above literatures)
Page 14 of 56


-

There is almost none study about delay in technology deploying project, but there
are huge number of studies about causes of delay in construction industry. On
the other hand, the process of deploying technology project and construction

project is similar, which include three stages: planning or design, implementing
or building and management (1) and SVTECH’s project also involve to
infrastructure construction. Therefore, the literature about delay in construction
project could be referenced for delay in technology projects to solve SVTECH’s
problem involve to time overrun projects.

-

There are many causes lead to time overrun project and they are different
between industries and countries (2), (3), (4). In Ghana, five critical factors lead
to time overrun construction project are: delay in government approvals/permits,
delay in preparation and approval in variation orders, client induced additional
work beyond the original scope, changed engineering conditions from the
contract document and decreased labor productivity due to extreme climatic
conditions (5). While, in Malaysia, main causes of time overrun project defined
was: from contractors; the contractor delay, causes from client, bad consultant,
and environment effects (3). Renuka et al. (2) has studied and summarized the
factors of delay project and dived them into 10 categories: manpower related,
material related, scheduling & control related, environment related, change
order, client related, consultant related, contract related, financial related,
external factors. These factors will be discussed in problem definition section.

-

In above factors, manpower, material, scheduling and control, client related
factors was appeared in initial causes-effect maps. They are illustrated by
variables:

Table 2. Relationship between factors and variables in causes-effect maps (interview
and above literatures)

Factors

Variable

manpower

work overload

material

late product delivery

scheduling and control

complicated documented and workflow

client related

customer delay
Page 15 of 56


-

An adding interview has been performed with Logistic-Purchase manager and
Sale and Project Management manager to define if these factors were existence
in SVTECH or not. Two managers was asked two questions for each factors
environment, consultant, contract, financial and external related:
+ Did SVTECH’s project delay because of X factor?
+ If X factors has caused to time overrun project, how frequently did it happen?

-

The result of interview is summarized in below table:

Table 3. Result of adding interview (source: second interview)
Logistic-Purchase
manager
environment - Have not happened

Sale and Project
Management manager
- Have not happened

Factors

related

- SVTECH’s project not be effected by environment.

Area

where

deployed

technology is not effected by
environment condition.

consultant

Have not been occurred

Not related to SVTECH

- Have not happened

- Rarely happened

related
contract
related
financial

- Did not happened in 2017
Have never happened

Have never happened

related
external

- Used to be happened once - Happened sometimes

factors

in July 2018

- Change law

- Change law lead to delay - Change technology
products

importing

and

project

-

After adding interview, only external factors were define that involve to
SVTECH’s time overrun project. Two external factors lead to delay project are
change law and change technology. Change technology has been presented by
project provided new technology variable in causes-effect map, so one new

Page 16 of 56


variable was added to causes-effect maps is change law. Law change required
company to register certificate for new some kind of imported products so it lead
to time of preparing product certificate longer and cause to late product delivery.
-

Besides, ineffective scheduling and control project variable also adding to make
clear the reason of late delivery which caused by complicated document and
workflow and lead to time overrun project (1), (6), (7).

-

On the other hand, Chitongo (8) found that client project time schedule control
could cause to time overrun project because client require meeting and report
lead to low productivity of project. This point was proved by contract with X
company which is one of SVTECH’s fastidious customers, who always strict on
time of project and always set some penalties in contract to force suppliers
comply with time. Therefore, “to many report” variable is added to causes-effect
maps which lead to complicated document and workflow.

-

Totally, there was 3 variables was added to updated causes-effect maps. They
was based on literature and has been confirmed by two managers are:
+ Change law
+ Ineffective scheduling and control
+ Client project time schedule control

1.6. Potential central problem
-

After updating causes-effect maps with literature and reconfirmed by 2
managers, there are 3 new variables is added, but only change law and ineffective
scheduling and control are potential problems. Besides, complicated document
and workflow was adjust to be causes. Therefore, there are total 5 potential
problems which lead to time overrun project was defined:
+ Ineffective scheduling and control
+ Sales had weak negotiating skill
+ Project provide new technologies
+ Customer delay project
+ Change law

-

As discussion in the phase of creating initial causes-effect maps, project delay
by customer requirement do not lead to lost for company because they accept for
Page 17 of 56


delay project. On the other hands, SVTECH cannot control customer’s internal
activities, if SVTECH try to push customer to complete project on schedule,
SVTECH may be lost customer. Therefore, it is infeasible and unnecessary to
control this causes.
-

Base on second data about time overrun project in 2017 (see data at section 6.4),
project provide new technologies and change law are rarely happen. There are
only 3 projects which was delayed because of incident when deploying new
technology project and there is only 1 project was delayed because of change law
in the present of 3 years). Besides, these two factors are both external factors
which could not to control so SVTECH have built a risk management plan to
reduce lost in case of change law or provide new technology. For example, when
providing new technology, sales have to ask engineer for time of project before
negotiating with customer. Moreover, engineer have to list risks may be
happened when providing new technology and create at least 2 contingency
plans. In processing phase of project, QA Department will monitors the cost,
resource and schedule and remind project members about deadline. On the other
hands, SVTECH added change law to contract as a force majeure clause from
incident of late delivery causes by change law in July 2018. Provide new
technologies and change law are being controlled, the effectiveness of the
controlled method will be considered at the end of December 2018 before
creating new plan to control. Therefore, this paper will not focus on these two

problems.

-

The lack of skill of Sales team has been recognize in the 2017 Year-end review
meeting and a training plan has been build. The training plan is not only focus
on Sale team but expand to all members in company to improve the employee’s
skills and build up company’s competence from human resource. This causes are
being correcting so this paper will not focus on it.

-

In the interview with Purchase-Logistic manger and Sale and Project
Management manager, both two managers claimed that late delivery is the main
causes of time overrun project and complicated document and workflow is
potential problem which lead to late delivery (see section 6.2. Summary of
Page 18 of 56


finding in first in-depth interview). Truly, about 67% of time overrun projects in
2017 cause by complicated document and workflow (see section 6.4). Currently,
there is not any effective solution to solving this problem. Purchase-Logistic,
Sale and Project Management Department have suggested to eliminate some
reports and delete some step in their working process. However, shortening the
working process make Board of Directors hard to monitor and control result of
work and create more risk for organization because workflow are not record to
review and evaluate. By these disadvantage, the suggestion was not approved, so
the report and work flow is not changed. By referring from (2) (3) (4),
complicated document and workflow is result of ineffective scheduling and
control. Time, cost, and quality is correlated, an effective scheduling and control

will control these factors to ensure achieved project’s objective. Therefore, if
SVTECH can improve the effectiveness of project scheduling and control
method, they can reduce not only number of time overrun project but also reduce
cost while ensure quality of project. Consequences, this paper will focus on
finding the solution to increase the effectiveness of scheduling and control
method at SVTECH.
2. Problem justification
2.1. Problem definition
-

Scheduling and control, which also be called time control system, is one of three
perspective of control system. Control system is responsible for project
management team, they have to monitor process, measure project‘s cost, time
and quality frequently, then report, evaluate actual and planed cost/time (9) and
apply corrective actions to ensure the project complete on time, achieve the
budget and quality requirement (10).

-

The effectiveness of control system is based on difference between actual and
plan because the accuracy of planning effect to result of project (10). The control
system is used to measure cost, time and quality, so in order to evaluate the
effectiveness of control system, different between actual and plan of cost, time
and quality should be measured (9). There is a formula which is used widely to
calculate the effectiveness of control system (1), (2), (6), (9):
Page 19 of 56


𝑌 (𝑡𝑖𝑚𝑒) =
𝑌 (𝑐𝑜𝑠𝑡) =

𝑌 (𝑞𝑢𝑎𝑙𝑖𝑡𝑦) =
-

|𝑎𝑐𝑡𝑢𝑎𝑙 𝑡𝑖𝑚𝑒 − 𝑝𝑙𝑎𝑛𝑛𝑖𝑛𝑔 𝑡𝑖𝑚𝑒|
𝑝𝑙𝑎𝑛𝑛𝑖𝑛𝑔 𝑡𝑖𝑚𝑒

|𝑎𝑐𝑡𝑢𝑎𝑙 𝑐𝑜𝑠𝑡 − 𝑝𝑙𝑎𝑛𝑛𝑖𝑛𝑔 𝑏𝑢𝑑𝑔𝑒𝑡|
𝑝𝑙𝑎𝑛𝑛𝑖𝑛𝑔 𝑏𝑢𝑑𝑔𝑒𝑡

|𝑎𝑐𝑡𝑢𝑎𝑙 𝑙𝑒𝑣𝑒𝑙 𝑜𝑓 𝑞𝑢𝑎𝑙𝑖𝑡𝑦 − 𝑟𝑒𝑞𝑢𝑖𝑟𝑒𝑚𝑒𝑛𝑡 𝑞𝑢𝑎𝑙𝑖𝑡𝑦|
𝑟𝑒𝑞𝑢𝑖𝑟𝑒𝑚𝑒𝑛𝑡 𝑞𝑢𝑎𝑙𝑖𝑡𝑦

The value of Y (time), Y (cost), Y (quality) is nearer 0, the control system is
better. Which Y value is higher, the control system is more ineffective at that
perspective. However, the acceptance of Y value is different between different
industries and areas (10). For example, acceptance of Y (time) in construction
industry in Western area will be lower than Asian area because Asian country is
fluctuated by government law (3) and change of mind from clients (8). On the
other hand, acceptance of Y (cost) in construction industry will be higher than
technology industry because material of construction industry fluctuated
frequently. Therefore, there is not any standard rate to evaluate the effectiveness
of control system, it depend on characteristic of industry and area.

-

Above formula is used to evaluate the effectiveness of control system of each
project. In order to evaluate the effectiveness of control system of a company in
a period, average of Y value and the standard deviation of Y in a period should
be calculated and compared to organization’s standardization (10), (11).

-

There is not any statistical data about acceptance or average of Y value in
technology industry in Vietnam. However, by implementing risk management
system, SVTECH has estimated and set the standardization of Y (time) is 5%
and standardization of Y (cost) is 3%. It is hard to measure the level of quality in
technology project, so SVTECH do not set the standardization for Y (quality),
the quality of project will be evaluate base on customer’s requirement. This paper
only focus on measuring the effectiveness of time control system because the
main objective of this paper is solve the time overrun project in SVTECH, cost
and quality control system is out of this paper scope. Besides, it’s hard to collect
data and evaluate the effectiveness of cost and quality control system because
data about project cost is confidential information which only Financial
Department and Board of Directors have permission to access, while measuring
Page 20 of 56


quality control system need technical basement knowledge and take time to build
and test measurement method. Because above limited permission and resource,
this paper will only focus on time control system.
2.2. Problem existence
-

In order to evaluate the effectiveness of time control system of SVTECH, data
about planning time and actual time to finish project has been collected from
Project Management Department (section 6.5). These project’s Y (time) has been
analyzed and indicated in follow table.
Table 4. Y (time) of project in 2017 (source: SVTECH’s data)
Y (time)

-

Number of projects

Accumulation Percentage

0%

74

68%

Upper 0%-3%

11

78%

Upper 3%-10%

12

89%

Upper 10%-20%

6

94%

Upper 20%

6

100%

Total

109

Average of Y (time)

3.6%

Standard deviation

8.38%

Table 4 revealed that only 68% of project has the same planed time and actual
time to finish. In comparison to SVTECH’s standardization of Y (time), there
are only 78% of project has achieved objective while 22% of project had Y (time)
over 3%.

-

On the other hand, the average of Y (time) is 3.6%, which is 0.6% higher than
company’s standardization. Besides, the standard deviation of Y (time) is 8.38%,
which is twofold the average of Y (time). This number reveals that the control
system is not stable caused by the ability to control time is weak and cannot
control project time.

-

Table 5 illustrates Y (time) of project at SVTECH in the period of 3 years from
2015 to 2017. Below table indicates the trend of increase of Y (time) every year,
Page 21 of 56


but it rose slightly from 1.9% in 2015 to 2.1% in 2016 and they are below the
standardization of Y (time). In 2017, the value of Y (time) increased significantly
to 3.6%, which is 0.8% higher than 2016.
Table 5. Y (time) in three year 2015-2017 (source: SVTECH’s data)
2015

2016

2017

3%

3%

3%

2.6.%

2.8%

3.6%

103 days

121 days

466 days

Expected Y (time)
Actual Average of
Y (time)
Total delayed days

-

Data in the period of 2015-2017 in table 5 also demonstrates that total number of
delayed days also rose annually. It increased nearly 20% from 103 days in 2015
to 121 days in 2016 then rocketed to 466 days in 2017. The number of delays
days in 2017 is approximately fourfold in 2016 and over double the total number
of delayed days in 2 year 2015 and 2016.These number reveals that company’s
control system are ineffective in time control.

-

After collecting data from project management team, an interview with project
management manager was deployed to confirm about the existence of problem.
The interview was only deployed with project management manager because the
problem is project control system, which involve directly to project management
team, so other team or department will not have trustable information. Besides,
time of research is limited and project management manager will have enough
information from other team members so he was chosen to be interviewed. The
content of interview transcript was showed in section 6.6.

-

In third interview, project management manager agreed that control system is
ineffective working and they lead to time overrun project. His team has been cut
down bonus last year because KPIs was not achieved. Therefore, project control
system is confirmed that is working effectively and should be controlled.

2.3. Problem consequences
-

Infective project control system lead to time overrun project and force company
to liquidated damages penalty from customer (8). When liquidated damages
Page 22 of 56


penalty happen, project cost was increase because of amount of money will spend
for penalty. Besides cost, company also lose the trust of customer, which make
customer make more rule to boost the time such as requirement of more report,
meeting (8). In more serious case, customer will cancel the business relationship
with company and choose another partner (10). This is huge lost for any company
when they lose customer for competitors.
-

On the other perspective, project control system is responsible for connecting
departments in company (8), (10), (11), so if project control system work
ineffectively, information communicating in company will be effected. As the
result, the internal conflict also happened because unclear information and
responsibly (10). As consequences, company resource such as human resource
and finance is wasted or use inefficiently.

-

Summarizing, there are 4 main consequences of ineffective project control
system is defined through above studies:
+ Financial affect: increase cost and lose profit
+ Development affect: decrease customer’s satisfaction or lose customer
+ Company culture affect: create conflict between departments
+ Operating affect: waste resource or use resource inefficiently.

-

In above four consequences, financial and development affect are occurred and
proved in section 1.2 and first interview. In contract with customer X, there
wasn’t any liquidated damages penalty was happen but the cost of project
increase 10% because of paying for overtime working. This was also one of ten
biggest projects in 2017, so the profit of company was decrease sharply in
comparison to planning. On the other case, customer Y’s complain is proved for
above second consequence. They also intent to find new partner if we are
overtime in next project which deployed in 2018. There are also other customer’s
complain and increase of project cost for 29 time overrun project, X and Y
customers was 2 typical case because they are two of company’s strategy
customers.

-

The conflict between departments has not been happened at SVTECH but
ineffective time control system leaded to waste resource and use resource
Page 23 of 56

inefficiently. The evidence was the increase of over time cost in below table. The
percentage rose 1% from 1.5% to 2.5% in 2017. The reason caused by ineffective
time control system, engineer had to work over time to catch the deadline while
they were free on previous days.

Table 6. Percentage of overtime cost to revenue in 2015-2017 (source:
SVTECH’s data)

Percentage of overtime cost to revenue

2015

2016

2017

1.5%

1.5%

2.5%

3. Causes validation
3.1. List of real causes
-

Time control system is critical factor effect to life cycle of the project (2), so it
is key factor to achieve project objectives (12). In order to evaluate the
effectiveness of time control system, two aspects should be considered are the

capability for assigning personnel and the deviation occurs in projects scope (2).
If firm is not willing to pay for highly skilled staff, project could be delay because
of following reason (2): lack of management personnel, lack of training
personnel, improper estimating skills. On the other hands, change of project
scope effect to Scheduling and control through following factors (2): change
orders and reworks, lack of conceptual stage, management support to model,
operation, monitoring of projects, change of contractors and subcontractors,
preparation of scheduling networks, revisions by client.

-

In another study, (7) researched about the factor effect to delay of project and
they defined that ineffective scheduling and control, which is one of the most
important factor effect on time plan of project, is caused by 4 reason: lacking
experience of project management team, lacking detail of plan, don’t updating
plan frequently, change requirement of clients.

-

On the other perspective, (8) considered the effect of project management team
behavior on the project control system. Because project management team is
center department, who communicate to connect related departments and
customer, so their behavior and communication will lead to result of project.
Page 24 of 56


Focus on information communication, (10) suggest that inefficient information
record and analysis lead to lack of or delay access to information about project
progress and this is main reason for ineffective control system.
-

(9) summarized the causes lead to ineffective control system are knowledge, skill
and experience of project management team, statistical measurement method,
risk identify ability. Another factor was added by (12): poor communication, lack
of effective leadership and project team behaviors.

-

Summarizing from above studies, there are three groups of causes lead to
ineffective time control system was listed in below table:
Table 7. Group of causes (source: literature review)
Group of causes

Detail of causes

1. Qualification of 1.1 Lack of control system knowledge
project management 1.2 Weak skill to negotiate with customer and control
team

time of suppliers.
1.3 Lack of experience to solve the changing in
project and incurred problems
1.4. Weakness at risk identify and control

2. Project document

2.1. Not define clearly project scope, responsibility of
project members.
2.2. Not accuracy and detail time plan
2.3. Don’t record project progress and update project

plan frequently

3. Inefficient control 3.1.
method

Ineffective

information

measurement

and

analysis
3.2. Ineffective information communication

-

In order to define which above causes impact on time control system at
SVTECH, the interview was deployed with project management manager (see
transcripts at section 6.6). The causes he recognized involve to lack of control
system knowledge, weak skill to negotiate with customer and control time of
suppliers and ineffective information communication. From interview’s clue, he
Page 25 of 56