AIT signs an agreement with Korea Research Council

On 12 December 2013, AIT just signs an agreement with Korea Research Council.

For detail, please see the news:
http://www.ait.asia/news-and-events/2013/news/ait-signs-agreement-with-korea-research-council-of-fundamental-science-and-technology/view

Regards
Hadikusumo

Merry Christmas and Happy New Year

Integrated Project Management Assessment for Development Property Project at Capital Fund In Vietnam

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MPM Articles in Dantri online newspaper

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Chương trình Thạc sĩ Quản lý dự án Xây dựng AIT: 5 năm một chặng đường

Khai giảng chương trình Thạc sĩ Quản dự án Xây dựng (MPM)

AIT tuyển sinh chương trình Thạc sĩ Quản lý dự án Xây dựng

Học Thạc sĩ cùng các nhà Quản lý dự án xây dựng hàng đầu khu vực

A Critical Appraisal of Briefing Client in Construction Process

Vietnam is a one of emerging markets following the UK Trade and Investment (2010) report. Accordingly, Vietnam is a country which is a market-leading selection by international investors especially the construction industry which attracting impressively by the possibility of its profitability. Therefore, the development of strategies for international construction demands in Vietnam is very essential to meet the client’s objectives in terms of function, quality, value, time, and cost and certainly.

The lacking of skilled person to meet the requirement of construction project in Vietnam is a big problem and lead to late delivery and over budget. Whilst briefing always has been a key element of any project. Often, requirements and demands from client are not collected adequately to provide solutions and result is inappropriate. Briefing is a communication process combined with record system to publish a set of documents to the design team; it is a process of developing a deep understanding about the client needs. It is a continuous interaction and involvement of the client and professional teams are important in this process. Through good briefing and grasping what the real needs are, client and professional consultants can work more effective and productive on project and make decisions confidently.

NGUYEN CHAU DIEU AN made a case study which objectives were to:

1. review the concepts, definitions of client and client briefing in construction in order to understand the client’s expectation through the client’s briefing process.

2. review the methods for strategic client briefing and other relevant literature on client briefing.

3. present the problems of briefing in a specific project in Vietnam and its solutions.

4. propose a framework of briefing for next project.

Conclusions

Briefing has long been recognized as an important and essential part in the international construction process. It has a substantial contribution to the success of a project. However, briefing has not been acknowledged in the formal way by client and consultant in Vietnam construction industry. Client and consultants are not aware of the importance of the briefing process and most of them have not been trained in factors related to the client’s brief.

The literature study shows the essential activities and interactive relationships involving the client organization and the design team as they progress through each phase of the project. It provides the value information to achieve assessments and objectives of the project.

The aim of this study was to explore a construction client’s process for project briefing and to improve understanding of strategic briefing and briefing methods for both client and consultant in meeting the client’s expectation. The study showed the problems that architect is stuck by not admitting what a paramount briefing and clarifies elements which play important roles in a success of project.

1. To know the client’s objective through the briefing process

In order to achieve this objective, the literature has been reviewed on the concepts of the briefing process, the definitions of a client, client’s expectations and the client briefing process within the construction. The investigation tried to understand the expectation of clients through the client’s briefing process.

2. To apply techniques of briefing process for architect

To explore different methodologies and tools that can be used to establish client’s demand and expectation on construction project such as questionnaire development, need analysis, briefing content, communication.

3. To understand the administrative and official process impacting on the briefing process

In order to achieve this objective, involvement of client, stockholders, end user, and consultant during the process is very essential. Managing changes of requirement, recording verbal communication, and making decision are factors in briefing administration which impacts success or failure of the project.

Besides the objectives above, this research also provided the methods to the briefing process to get requirements from client such as empowering client, managing project, parties’ involvement, team building and using computer system, communication skill, and record system.

Although there are still problems in Vietnam construction industry, this study has been achieved by the conclusion that the construction industry in Vietnam will be focused on a briefing process especially in application methods of briefing, training and acknowledgement a brief properly to get efficiency, profitability of a project.  

Recommendation to improve briefing process in Vietnam construction industry

1. Perceive role of briefing

Need to train all parties involved in a project aware of how important the briefing is, the role of briefing in a project and contribution of briefing to the success of a project. Through a better briefing, an architect can get what the real client wants and client’s expectation. Even client, they will be able to make decisions related to investment with great confidence.

2. Understand briefing process

Briefing process is an interactive process between the client and professional teams and briefing happens continuously during the construction process. Briefing process needs many techniques, tools to get requirements and demands from client such as team building, getting information, analyzing, managing changes of requirement, recording, and communicating.

3. Apply different techniques in construction

Find out various techniques to apply in a briefing process such as using computer system to improve communication between client and professional team (Science & Engineering Research Council) includes general approach, questionnaire development, data analysis, system contents.

Abstract

Client briefing plays a crucial role in success of a construction project. A successful briefing can achieve the target time, cost and quality for a project and make decision on project confidently. Although there are many attempts to approach client’s requirement and needs for a project, it is still not collected adequately to make appropriate solutions in design. In Vietnam, client briefing is not considered an important process and architects usually focus on design without paying any attention what their client really wants.  

The objective of this research are to provide a basic knowledge of briefing process which is not consider as a integral process in construction process in Vietnam, present research, analysis of problems of briefing in a project and recommend a briefing framework in order to avoid client’s frequent changes and control information collected systematically.

This Project Report has taken a general view of Briefing Process in theory and analyzing a case study that applied in Vienam to find out reasons of failure, lack of briefing techniques. The report points out that a framework of briefing need to be established for identification what a client really wand and clarification of client’s demands.  

MPM Gathering Day 2013

MPM Gathering Day 2013

08 Dec 2013

Lan Anh club, Ho Chi Minh city

MPM Gathering Day 2013 in HCMC on 08 December 2013 successfully organized by MPM Alumni club with over 80 participants who are MPM/CEIM alumni, MPM students, AITAA-VN representatives from Ho Chi Minh ciy, Can Tho and Vung Tau.

They had chance to gather together and review the unforgettable memories of the studying time at AIT during activities of Gathering day such as tennis cup and gala party. 

The tennis cup for men's doubles only were interested in over 30 registered players and its result is as following:

- Champion: 

• Dr. Hadikusumo, MPM/CEIM Coordinator
• Mr. Le Quang Dung, MPM3 Can Tho student

- 1st runner up:

• Mr. Nguyen Phan Hoa Binh, MPM3A HCMC Alumnus
• Mr. Dau Hong Quan, MPM7 HCMC student

- 2nd runner up: for 2 men's double

• Mr. Luu Hoang Nam, MPM7 HCMC student
• Mr. Engwan, MPM faculty

 and 

• Mr. Nguyen Duc Trong, MPM3A HCMC Alumnus
• Mr. Phan Tuong Liem, MPM2 Vung Tau Alumnus

Everybody felt very excited with karaoke songs from single or group alumni and student "singer". Ten lucky persons won 10 lucky prizes during Gala party. Lucky prizes came from MPM program and sponsors. 

We highly appreciate our sponsors for this event and their contributions for MPM activities for a long time. 

- Mr. Do Huu Phuoc, MPM3B HCMC

- Mr. Hoang Thanh Ha, MPM6 HCMC and QTC company

- MPM6 HCMC class

- Ms. Mai Do Thuy Dung, MPM1 HCMC

- Ms. Lu Ngoc Anh, MPM6 HCMC

- Mr. Nguyen Van Nhan, MPM3A HCMC

- Mr. Nguyen Chanh Phuong, MPM3A HCMC

- Mr. Chau Anh Tuan and Mr. Vo Thanh Phong, MPM4B HCMC

- Mr. Thuyet, AITAA-VN, SOM 01-03

- MPM Program

- Dr. Hadikusumo and Mr. Engwan

On behalf of MPM Alumni club, we would like to say thank you to all MPM faculty, alumni, current students who made the success of MPM Gathering Day 2013. We would hope all of members of MPM family will connect closely, maintain our network and meet together again in Gathering Day next year.

Ready for FINAL ROUND

Semi-final round - men's doubles

Semi-final round - men's doubles

2nd runner-up for tennis cup

1st runner-up for tennis cup

Champion - Dr. Hadikusumo and Mr. Le Quang Dung

Group photo of MPM Gathering Day

2nd prize of lucky draw

"Group singer" of MPM7 current students

Effectiveness of Feasibility Study Analysis in Apartment Building Project

In the context of declining global economy, Vietnam’s real estate/market and construction potential is one the reasons why foreign investors remain attracted in the country. The construction projects present a unique situation where each project is different with different situation and parties. One  of  the  important  stages  involve  in  a construction  project  is  the  preparation  of  the  feasibility  study. Feasibility Study is being conducted during the formulation phase of Project Cycle. It verifies whether the proposed project is well founded, and is likely to meet the needs of its intended target groups/ beneficiaries. The study should design the project in full operational detail, taking account of all policy, and technical, economic, financial, institutional, management, environmental, socio-cultural, and gender-related aspects.

According to the characteristics of construction industry, it has high uncertainty, so many risks will occur during Project Feasibility Study. This problem might influence to the decision making of the project and to its profit. To those assumption, the main construction factors should have been anticipated and calculate it into the feasibility analysis so that avoiding risks will become additional advantage for the investor.

TRUONG NGOC DUNG made a case study which objectives were to:

1. conduct an exploratory study on the factors and process used in financial feasibility study

2. develop a framework for an effective financial feasibility for Apartment Building Project

3. conduct a case study to validate the effectiveness of the framework

This issue is more significant to some of the construction investors facing serious problems with budget control, as an effective budget control is critical for investing in large projects.

Conclusions

The case in this report described a practical implementation in the Feasibility Study stages of Apartment Building Project of Vietnam in general and Ho Chi Minh City in particular which obviously revealed the factors which can seriously affect the success of the project. Actually, Vietnam at present has enormous efforts to overcome policy and reduce the cumbersome procedures in investment, but investors still face a lot of problems (Financial Feasibility Study) which occurs in term of project implementation.

So based on this study, how to implement the effective feasibility study such as the factors and processes used in this stage were understood. There are expenses, sources of fund and revenues; and methods of estimation. Moreover NPV method, B/C ratio method and IRR method were the methods of evaluation used, in addition, to establish a useful framework for Apartment Building Project.

In conclusion, the report may not only offer the effective method to make Feasibility Study in the first stages of project implementation, but also clear description of the major factors that may affect the efficiency budget that most projects in Vietnam are all experiencing. The problem of cost overrun, bankrupt and project costs incurred were up compared to initial estimates.

Recommendations for further study

This research has concentrated on finance in estimated cost, revenue and how to analyze the project financial. However, other influence factors such as local politics, public relationship and strategy of the owners did not mention.

Feasibility Study should be done not only once, but it must always check at different stages such as design stage, construction stage and after operation and transfer stage for the main purpose of improving the later project.

In addition, Sensitivity Analysis to recognize the priority factors after calculating the financial factors for the Apartment Building project should also be considered, so that these factors can be managed.

Abstract

The Real Estate investment is one of the most dynamic, risky and challenging businesses because of their implementing time is very long with huge investment capital and various participating components. Furthermore, this field has poor skills for making Feasibility Study, with many major projects failing to finish on time and cost targets.

Feasibility Study of construction project used to get the alternatives of optimal land use that give the highest profits. Feasibility study analysis also gives information about value of investment and the benefits that investors will get. Define return of investment can be seen from feasibility study. Commonly, Net Present Value (NPV), Internal Rate of Return (IRR) and Benefit/Cost (B/C) are the values that used by investor to consider this project is feasible or not.

The purpose of this study to identify effectiveness methods, main major estimated factors that will be occurs in this stage. To effectively making the financial feasibility study in construction project, it is necessary for oriented path to identify important factors, then provide a suitable tool to measure their effects in each stage of Financial Feasibility Study life cycle and suggest the effective solution methods as minimized/maximized, shared, or accepted.

AIT Seminar: Strategic Infrastructure Development of South East Asia

Seminar
STRATEGIC INFRASTRUCTURE DEVELOPMENT OF SOUTH EAST ASIA

On 11 Dec 2013, MPM program organized the seminar " Strategic Infrastructure Development of South East Asia", presented by Dr. Chotchai Charoenngam, Associate Professor, Construction Engineering and Infrastructure Management, School of Engineering and Technology, Asian Institute of Technology, Thailand.

South East Asian is considered of one of the fastest growing region in the world. The demand of infrastructure development has been rising much faster than the supply, especially entering AEC in 2015. Strategic infrastructure needs to be developed to capture economic growth. Types of strategic infrastructure and its contribution to national socio-economic development were presented during the seminar. 

Environmental Impacts Assessment in Nam Ly Bridge – Ho Chi Minh City, Viet Nam

The people’s demands have been increasing rapidly while the resources are limited. To satisfy the increasing demands, people search for every opportunity to develop the economy. Because of that, investing in infrastructure construction is a need to develop economic regions, which is a progress in the development of the society.

When human brings in financial to change the patterns of use of land, water and other natural resources, they will receive back profit from economic development, but will also change the other elements of the environment. The question is how to reduce these changes, but still aiming for economic growth.

TRINH THI THU HA made a research which objectives were to:

1. study environmental impacts assessment methods

2. compare of the Vietnam’s policies and ADB’s policies in EIA

3. study environmental impacts assessment of construction project in Vietnam

Conclusion

EIA is one of a number of policy tools that are used to evaluate project proposals. It is also a relatively recent development when compared to use of economic appraisal methods in Vietnam.

For most construction projects in Vietnam that will invest funds from many different capitals, they are required to comply with laws and regulations to implement the project. EIA must be researched in Preparation stage and presented in the Appraisal stage.

The contents of the EIA is usually consists of nine parts: Introduction; Description of the Project; Description of the Environment; Alternatives; Anticipated Environmental Impacts and Mitigation Measures; Economic Assessment; Environmental Management Plan; Public Involvement and Disclosure; and Conclusions.

The EMP described how the mitigation and other measures enhance the benefits of environmental protection that will be implemented. It explains how the measures will be managed, who will implement them, and when and where they will be implemented. During project implementation, the clients must implement properly the approved content of the EIA, to ensure that negative impacts on have been mitigated and environment, community has been protected for the sustainable development objectives.

There are differences between Vietnamese policies and the sponsors’ policies for EIA in Vietnam such as ODA projects, World Bank and Asian Development Bank which also have regulations and guidelines that established EIA applies to projects funded. Possible policies and activities required of them in different way, but the process is relatively the same for the building and approving the EIA. In Vietnam, in addition to the applicable policies of the sponsors for the project, the EIA also have to establish compliance with current policies of the government of Vietnam.

However, if there are differences between the policies of Vietnam and the donor's policies, they must apply the policies of the donors, which is required in the loan terms.

Recommendation

1. Adjustment or harmonization of policies and laws in the implementation of EIA, without gaps to the policies of the donors (ADB, World Bank, etc.).
2. The Government should establish training programs for students of the EIA and raise awareness and capacity about the protection and management for environmental leaders, department managers and community.
3. Establish public databases and share the parameters of environmental quality for other projects in Vietnam.
4. There should be public participation during the implementation of EIA. The project must be publicly reviewed and evaluated by the public.
5. Full finance for the EIA study.

Abstract

The demand of people increase rapidly while the resources are limited. To satisfy the increasing demands, people search for every opportunity to develop the economy. Because of that, investing for construction of infrastructure is a need to develop economic regions, is a progress in the development of the society.

When human bring in financial to change the patterns of use of land, water and other natural resources, they will receive back profit from economy development, but will also change the other elements of the environment like natural condition and social.

Reducing the burden of environmental impacts is necessary if development is to become sustainable. Environment Impact Assessment (EIA) has become of ever increasing importance as a tool for development decision-making.

Environmental impact assessment, as a national instrument, shall be undertaken for proposed activities that are likely to have a significant adverse impact on the environment and are subject to a decision of a competent national authority.

In practice, EIA is applied primarily to prevent or minimize the adverse effects of major development proposals.

Organizational Project Management Structure in a Real Estate Developing Company

Project management structure is a new issue in Vietnam. There are more and more real estate development companies in Vietnam in which many of them process great potential for the project management team. But the concept of project management structure is one thing that not all companies are aware off. In fact, there are still confusions in choosing the model for organizational project management structure such as:

1. Unclear tasks

2. Communication, teamwork, leadership…

3. Objectives not properly defined or agreed

4. Insufficient planning and coordination of resources

Nguyen Duc Trong made a case study to identify and find out the ideal project management structure for a developing company. In order to accomplish this, the objectives of his research were to:

1. study the literature of Organization Project Management Structure in construction project

2. analyze a Case Study in application of Organization Project Management Structure in Viet Nam

Conclusion

Organizational structure can get in the way of, or help support, the overall success of projects. To a certain extent, we can change the organizational structure. In fact, we can change the organization chart frequently, and some companies do just like that. Culture, on the other hand, cannot easily change. It can take years for a large organization to develop a culture of excellence (although it doesn't take nearly as long to fall back into mediocrity).

Some organizational structures can definitely impair the ability to deliver projects. First are those organizations whose project teams are doing support work. If the project organization does support as well, it usually means that support issues will pop up and take the focus away from the project. A lot of multitasking and thrashing takes place as we move from support work to project work to support work. It is usually very difficult to prepare good estimates and meet the scheduling commitments. We may be forced into this structure if our staff is small. Sometimes, we have 15 people who work on support, projects, and enhancements. However, we do not have enough people to specialize in either support or project work. This makes it difficult to meet all of our project commitments. Instead, we have to do a good job of managing expectations.

The organizational structure may also impede the ability to share resources. For instance, if our project team needs a resource with a specific expertise, we may not be able to easily share that person with another functional area. Some of this is also related to our culture. We have to consider whether a different organizational structure would help. If it would, we may have an organization problem. If it wouldn't help, our culture is probably not supportive of resource sharing.

The organizational structure can also help or hinder the success rate. The structure can determine how well we focus on projects and how easy it is to share resources between organizations.

Recommendation

1. Consider the system of Project Management structure. Develop individual assessment form for functional manager, project manager. By involving functional management in project initiation activities-recognizing that functional managers often have the best insight into the skills and limitations of staff members-we made the process of assigning resources to roles more collaboratively. We also instituted a formal requisition process for internal resources. Project managers were added to the performance development process training classes and required to provide periodic performance-related information to functional managers. At the same time, functional managers now shared individual goals and objectives with project managers, seeking to align project assignments with objectives.

2. Build up the enterprise culture and create the transparent competition among departments. Have good authority system and empowerment so that all the department leaders can have the conditions to give out the right decisions.

3. Have clear annual plan and transfer this plan to every department, and every individual. Check, monitor and access this plan monthly or quarterly to create fair in bonus sharing.

4. Re-define Roles and Responsibilities: establish a policy statement and matrix document that clearly identified the project manager and functional manager roles and responsibilities.

5. Establish a Communications Plan: developed a comprehensive program communications plan identifying who reports what to whom, and when. Acknowledge the information needs of the functional management team by including them in the communications plan. Project websites could be established to facilitate communications.

Abstract

A project organization is a structure that facilitates the coordination and implementation of project activities. Its main reason is to create an environment that fosters interactions among the team members with a minimum amount of disruptions, overlaps and conflict. One of the important decisions of project management is the form of organizational structure that will be used for the project. Each project has its unique characteristics and the design of an organizational structure should consider the organizational environment, the project characteristics in which it will operate, and the level of authority the project manager is given. A project structure can take on various forms with each form having its own advantages and disadvantages. One of the main objectives of the structure is to reduce uncertainty and confusion that typically occurs at the project initiation phase. The structure defines the relationships among members of the project management and the relationships with the external environment. The structure defines the authority by means of a graphical illustration called an organization chart. 

Risk Factors in Vietnam Power Plant Projects

In the past, risk management has been an important tool to control safety-related risks. However, we see the shift away from the traditional compliance and insurance-motivated risk management to one that is closely linked to business performance and long-term society commitment.

In order to minimize the interfaces and risks between the separated contractor and the project company during executing an oil and gas project, the oil and gas companies normally prefer to award and sign an EPC contract with the EPC contractor. However, this project delivery method will take a lot of time to make clarification, explanation and get the mutually agreement on the contract clauses between the contractor and the project company. The following problems are normally involved with the EPC contract clauses:

1. Take time to make the clarification and finalization before contract signing;

2. Wrong understanding and interpreting of stipulated clauses in the contract;

3. Conflict between contractor and the project company during project execution

An EPC contract is generally applied for developing the oil and gas project, in case of problems or disputes happen during the project execution, then these problems and disputes shall be resolved in accordance with stipulated clauses in the signed contract, therefore, Nguyen Duc Thanh made a case study which aimed to focus on the following issues related to EPC contract:

1. To study the contract of EPC project and contractual risks

2. To study contractual problems occurring in a project.

3. To propose a recommendation for improvement

Conclusion

The research study summary and concern the risks we often meet when executing EPC oil and gas project in Vietnam. It also mentions and suggests effective solutions that can be performed to avoid or overcome the obstacles in contractor management.

The literature review sections introduce and cover the form, phases and activities for general EPC project. It is also listed advantages or disadvantages and challenges when we apply EPC model to manage project, especially managing Vietnam EPC project. The advantages under investor’s point of view of EPC contract model in respect of following:

1. Reduction in project management works for an investment owner;

2. Reduction in risks of difference between design and construction;

3. Costs for an EPC package are easier to estimate and control because it is lump sum contract.

This chapter has also raised reason which case EPC should be applied in Vietnam:

1, Project with multiple options of construction methods;

2. Projects in which whose design and equipment production cannot be separated

3. And in case a project has urgent progression.

In two case studies mentioned in previous chapter, through collecting related document and attending as one of duty to solve these problems, risk in Vietnam appeared in oil and gas projects normally come from what parties haven’t defined or stipulated in contracts. Moreover, maybe some contractor want to expand profit as well as possible, they change some conditions they can, except some case is compulsory for pushing project schedule.

According to studies and data statistic, client needs to play as interface when many contractors participate in project. It requests a professional team to monitor, assess and can hold point whole activity of contractors. Schedule is always updated and mobilization plan of employee and equipments must comply with master schedule.

Through the review of literature on EPC model and risk in EPC contract, it’s proposed that solutions of effective EPC risk management needed such as “the problems often appear in execution stage of project and we meet difficulty in avoiding them. However, we can ignore or minimize problem through understanding and clarify term, scope of work in contract. In additional, these problems that can be predict or determine happen in the next phases but can’t solve at this time, we need to stipulate them in contract about solutions to control, monitor or solve”.

In conclusion, for each of EPC project, risks accompany by them are not the same. The risks depend on whole EPC project such as: scope of work, material specifications, equipment style and requirements of client. Therefore, risks management application for the kinds of EPC projects will be different little or more. So, application should be considered via EPC project style.

Suggestion of further researchers

In order to fully understand the EPC risk management in Oil and Gas project, which can be applied in some kinds of project, especially international oil and gas project, further researchers can be suggested on the following fields:

1. Develop risk research in another phase of projects: design, construction, commissioning

2. Based on result of research, proposing solution to risk management.

Abstract

Oil and gas projects are established intensely to satisfy the energy demand on the world. In an EPC contracts help provide ‘turnkey ‘systems for companies. This is where a single point of contract is given which includes the design work, engineering procurement, installation works, commissioning, start up, supply chain materials, testing activities. Due to this single point of responsibility, almost all the risk is transferred from the owner to the contractor. In this contract, there are guaranteed completion dates, performance, clear division of obligations and liabilities. EPC projects which are also known as turnkey project service face many challenges to stay in the competitive within the industry business environment despite of the efforts made towards compressing activities by phase overlapping, in order to reduce time scale and to obtain better EPC projects. These project challenges lead to cost overrun and schedule delay. Understanding the function of EPC Project Risk Management is important to protect interest of both parties and to engage tools and techniques to allocate risks between the owners and contractors.

Most projects are bound to be affected risks such as construction risks, operational risks, financial and economic risks, legal risks etc. All these risks are interrelated and have a chain effect in overall start-up and commissioning. Common delays and cost overruns can have severe effects and causes as a primary effect on construction risks. Therefore it is important in a project when structuring EPC contract. EPC contract comes many new risks that are often severe due to the complex nature and high cost frequently associated with this type of project involved

By finding out and analyzing the problems happening in Nhon Trach power Project  and Ca Mau Project, through collecting data and assessing status of project in each phase, the research study aim to identify and analyze problems that often occurring as well as resolutions and try to suggest solutions which are effective to solve the problems.

Solutions to manage Risk in EPC project was developed as a result of the research case study which is helpful for Vietnam oil and gas projects wishing to overcome obstacles by avoiding or minimizing these risk.