Owner’s Project Life Cycle Approach

In recent years, VRC has invested big amount capital for expanding rubber plantations and upgrading rubber processing facilities both domestic and outside the country. VRC has been carrying many rubber plantation projects in Cambodia, Laos and has been negotiating with Myanmar government. For VRC, the concept and practice of owner’s project life cycle have been used in rubber plantation projects. Nevertheless, VRC has not built a type of project life cycle appropriating with its specific characteristics; therefore, some projects meet with serious difficulties during performance. Although Cambodia projects are now just in middle of project life cycle but many problems happened like the costs balloon out of control, the scope expands beyond reason, the project slips behind schedule, and the deliverables do not possess expected value in Cambodia projects.

According to internal audit and the report of situation of the project management in construction of VRC in the period of 2007-2010, it shows many problems happening with VRC’s oversea rubber projects, especially cost and schedule. The problems, according to reports that VRC’s projects encounter as follows:

-          Cost overrunning or over budget;

-          Projects are prone to delay;

-          Project quality uncontrolled;

-          Project scope creep.

Also according to this report, VRC recognize the bad results in Cambodia are created by many reasons; however, poor management of the project life cycle is one of the reasons brings about serious consequences including the followings:

-          No establishing a framework of project life cycle;

-          Project proposals and business cases and project selecting process in the first phase were carried out incautiously have impacted to all remain phases of the project life cycle;

-          Some projects do not have a strong project management team;

-   Inadequate delegation from VRC’s head quarter and the project organization is not properly;

-          Lack of managerial skills and competencies as well as the internal capacities of the owner

VRC consider that the result of poor management of the project life cycle is one of the causes impact to the projects negatively. They are the critical problems which VRC and other related parties to Cambodia projects need to consider cautiously.

Do Huu Phuoc made a case study to study Vietnam Rubber Company’s project life cycle approach, analyze situation and develop a framework of project life cycle of a rubber plantation project and guideline to possibly ensure the projects deliver on time, on budget and to the level of quality expected.

Conclusion for VRC’s project life cycle approach

There is no single best approach in organizing project management throughout a project's life cycle. All organizational approaches have advantages and disadvantages, depending on the knowledge of the owner in project management as well as the type, size and location of the project. It is important for VRC to be aware of the approach which is most appropriate and beneficial for a particular project. In making choices, VRC should be concerned with the life cycle costs of planted rubber trees, constructed facilities rather than simply the initial costs.

Saving small amounts of money during construction may not be worthwhile if the result is much larger operating costs or not meeting the functional requirements for the new facility satisfactorily or the objective is not align with the scope. Thus, generally a project or particularly a rubber plantation project wants to finish successfully it must be very concerned all the phase of the project life cycle.

Recommendations

With so many ongoing projects like situation at present, VRC may encounter difficult for all projects to get adequate support, or even the attention of top managements. The particularly common problems when trying to manage multiple projects concurrently may be:

a.    There is no time for summary experience lessons so the mistakes from a project can repeat to all projects.

b.   Delays in one project may drag other projects delay because of common resource needs or technological dependencies;

c.  The inefficient use of corporate resources results in hills and valleys of resource utilization;

d.   There are unwholesome competitions between project teams to get support, or the attention of top managements;

VRC should consider a temporary stopping with the current projects to review all the problems happening. The lessons learn from projects should be analyzed, critiqued and documented for later use by the future projects and any other projects will be performed by VRC in Cambodia or other countries in the future. 

This study has concentrated on owner’s approach in managing project life cycle to an agriculture project. However, there are many aspects relating to the project management. Further studies should be carried out to find out the approach of owner for agriculture project management.

Abstract

 Project life cycle is an approach that links the phases, which can lead to significant results required for completing a project. As the owner has the most authority in enforcing the implementation of constructability, the owners' awareness of the benefit of the project life cycle is the most important. Project owners must be aware that the decisions that are made in the stages of projects are difficult and costly to change once construction begins.

Owners should recognize that there is no single best approach in organizing project management throughout a project's life cycle. All organizational approaches have advantages and disadvantages, depending on the knowledge of the owner in project management as well as the type, size and location of the project. It is important for the owner to be aware of the approach which is most appropriate and beneficial for a particular project. In making choices, owners should be concerned with the life cycle costs of constructed facilities rather than simply the initial construction costs. Saving small amounts of money during construction may not be worthwhile if the result is much larger operating costs or not meeting the functional requirements for the new facility satisfactorily.

However, the traditional approach to project life cycle limits their option for involving in the phases of the project. The general lifecycle model that an organization use will probably be similar to one that has been used dozens or hundreds of times at other organizations. There is no reason to reinvent everything for your own project. It just takes longer and contains more inherent risk. The better approach is to utilize a standard set of lifecycle processes, techniques and templates which to be used in the same industry.