Unproductive project management process in ITC HCM

LIST OF FIGURES Figure 2: General workflow for a typical research project and personnel assignment 8 Figure 3: Recruitment/Departure of employees in ITC-HCM since 2010 10 Figure 5: Pos

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-

NGUYEN THANH TUNG

UNPRODUCTIVE PROJECT MANAGEMENT PROCESS IN ITC-HCM

MASTER OF BUSINESS ADMINISTRATION

Ho Chi Minh City – Year 2018

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-

NGUYEN THANH TUNG

UNPRODUCTIVE PROJECT MANAGEMENT PROCESS IN ITC-HCM

MASTER OF BUSINESS ADMINISTRATION

SUPERVISOR: PhD TRAN HA MINH QUAN

Ho Chi Minh City – Year 2018

LIST OF FIGURES

Figure 2: General workflow for a typical research project and personnel

assignment

8

Figure 3: Recruitment/Departure of employees in ITC-HCM since 2010 10

Figure 5: Possible causes leading to turnover actions acquired from interview

with Admin head officer

12

Figure 6: Summary of causes leading to turnover actions acquired from

interviews with departing engineers

13

Figure 7: Summary of potential causes of dissatisfaction acquired from

interviews with current employees

Figure 15: Main tasks with time schedule for adapting ProjectManager platform 29

LIST OF TABLES

Table 3: Budget for consultancy services to construct a clear work process for

project management in ITC-HCM

31

Table 4: Interview guide with Mr Bac NT, Admin head officer who is in charge

of HR activities

33

Table 7: Summary of findings of interviews with departing engineers 39

Table 9: Summary of findings of interviews with current employees 45

Table 11: Summary of findings of interviews with senior project leader 53 Table 12: Questionnaire for quantitative research to evaluate the importance of each determinant

54

ACKNOWLEDGEMENT

First of all, I would like to express my warmest thanks to my supervisor Dr Tran Ha Minh Quan for his patience, encouragement, and professionalism His clear guidance and candid evaluation for my thesis have helped me complete all qualitative and quantitative researches on time with satisfactory results as well as led me to finish

my Master thesis

I also would like to thank all lecturers in International School of Business (ISB) for courses and subjects that they had taught me and my classmates The knowledge that I gained from the courses has widened my knowledge as well as provided me with valuable experience in practical businesses

Additionally, I would like to thank all members in thesis defense committees, for their insightful comments and evaluation I also want to thank all ITC-HCM

employees and officers who had cooperated with me during data gathering, interviews and surveys

Last but not the least, I would like to thank all my classmates in MBUS 7

program for their cooperation, support, discussion and unforgettable moments that I have been with them in the last two years

EXECUTIVE SUMMARY

Employee turnover places a lot of difficulties towards organizations in terms of new recruitment, training, organization, costs and so on Voluntary turnover behaviors can be initiated by low job satisfaction, especially in state-own organizations ITC-HCM

is one of state-owned organizations located in Ho Chi Minh city and facing abnormally high turnover rate among skilled engineers To investigate the situation as well as the main causes for engineer turnover, a number of in-depth interviews were conducted with departing employees and relevant co-workers The results of these interviews reveal the main causes for their departure, which involves leadership style, project management, work environment, compensation and benefits, work morale To have broad views of the turnover situation in state-owned petroleum firms, a number of previous academic theories have been applied to make a cause-effect diagram for the turnover issue By evaluating and verifying each cause, researcher could locate the core problems leading

to the high turnover rate Though the reasons for employees are diverse and varied from employees to employees, for the company, the most critical problems of the state-owned company is “Unproductive project management process” which involves loose management, unclear task assignments and too much reporting system The suggentio for improvement are 1) to apply project management technology for the company, which also enables team communication and progress tracking, and 2) to hire consultancy service to help construct more productive work process with clear measures and key performance indicators Action plan and budget are proposed accordingly The suggestions from researcher are expected to improve the company’s performance in order to help reduce the turnover intention accordingly

I COMPANY INTRODUCTION

1.1 General information about ITC-HCM

Integrated Technical Center (ITC) is a subsidiary of PetroVietnam Exploration and Production Corporation (PVEP) The company was established in September 2010 and works as main research unit for PVEP to supervise and optimize oil & gas activities for most oil fields on Vietnamese continental shelf ITC consists of 02 offices: head office in Ho Chi Minh city and representative office in Ha Noi city The research will focus into the Ho Chi Minh head office, which is named as ITC-HCM

Since the mother company PVEP is fully owned by the Vietnamese government, ITC-HCM, as its subsidiary, is also considered a state-owned enterprise (SOE)

1.2 Company organization

Before 2017, ITC-HCM had a total number of 41 personnel However, since

mid-2017, 5 engineers departed from company, making the total number of current personnel

36 The company consists of 02 main departments: Technical and General Administration The board of directors includes 01 director and 02 vice directors, each in-charge of one department The organization of ITC-HCM, until September 2018, is illustrated in Figure 1:

Figure 1: Organization chart of ITC-HCM

 Technical department:

The Technical department includes 3 sectors: Exploration, Reservoir and Production Each sector is supervised by head officer and vice officers This is the main revenue-earning department for company, which focuses into researching and optimizing oil & gas activities as well as conducting outsourcing researches The department includes 19 skilled engineers with oil-gas engineering background Most of engineers are over 30 years old with more than 5 years working for ITC-HCM

 General Administration department:

The General Administration department only supports for technical departments and board of directors with paperwork, accounting, reception activities and so on There are 03 sectors within this department: Admin, Accounting and Commerce Admin sector

is in charge of logistics, paperwork, reception as well as other human resource activities Commerce sector is in charge of preparing contracts and account management while Accounting sector is in charge of typical accounting activities The accounting sector is supervised directly by a vice director

In ITC-HCM, there are Union Division, Women Association and Ho Chi Minh Communist Youth Union like other SOEs These organizations help to increase the engagement of employees and to protect the rights of employees

1.3 Business activities

As a research subsidiary of PVEP, ITC-HCM is in charge of supervising oil and gas activities of assigned oil-fields on Vietnamese shelf, such as block 01-02, block 02/97, block 42, and so on Each engineer in Technical Departments is assigned to supervise specific activities in certain field(s) and annually reports to supervisors and directors about the status of those activities

Exploration engineers are in charge of Geology & Geophysics activities, such as exploring new hydrocarbon prospects, interpreting time & depth horizons of those prospects, identifying sedimentary paleo-environments The results from Exploration engineers will become input data for static and dynamic models of Reservoir engineers

Reservoir engineers use the input data provided from Exploration engineers to generate structural models (or static models) and dynamic models in order to calculate

potential hydrocarbon volume of certain oil- fields and forecast the future production volume of existing fields

Production engineers use the forecasted models from Reservoir engineers to propose detailed plans for field development and/or cost optimization for existing field operations

 Project outsourcing

Besides main function as research unit for PVEP, ITC-HCM also works as research outsourcer for other oil-producing operators in Vietnam such as Cuu Long JOC, Bien Dong POC, Hoang Long - Hoan Vu JOC, etc The typical workflow of a research project is illustrated in Figure 2

Figure 2: General workflow for a typical research project and personnel assignment

In this industry, ITC-HCM does not have many competing opponents In fact, there are two other companies with similar functions, Vietnam Petroleum Institute (VPI) and NIPI However, VPI is located in Ha Noi while NIPI in Vung Tau; both companies only conduct service projects for local companies Therefore, the competition from VPI and NIPI against ITC-HCM is considered relatively low and ITC-HCM is the only oil - gas research unit in Ho Chi Minh City

 Revenues

ITC-HCM receives yearly financial funding from mother company PVEP as well

as revenues from outsourcing research contracts The financial data of company is not officially announced but from interview with Admin officer of the company, total combined revenues of company from 2015 to 2017 (2018 data is not yet available) are shown in following Table 1:

Table 1: Combined revenues of ITC-HCM from 2015 to 2017

Year 2015 2016 2017 Revenue

Figure 3: Recruitment/Departure of employees in ITC-HCM since 2010

All of 5 departing employees were highly skilled engineers who used to work for Technical Department, which included 02 exploration engineers, 02 reservoir engineers and 01 production engineers Demographically, 5 engineers, 04 males and 01 female, were from 30-40 years old, married and had 1-2 children They all lived in Ho Chi Minh City and near ITC-HCM’s head office in Phu My Hung, District 7

In terms of experience and skills, all of departing engineers were experienced and skilled technical engineers with more than 5 professional years working for the company; some had more than 10 years of experience in oil & gas industry Moreover,

02 of them used to be project leaders, who led team of 2-3 members These employees were key members of their technical teams and played important role in company’s projects Furthermore, all of 5 departing employees were voluntary to terminate their Indefinite Duration Contracts with the company

The departure of those engineers had placed a lot of difficulties to the company The difficulties were emphasized by Mr Bac NT, the Admin head officer who is also in charge of HR activities of the company According to the interview results with Mr Bac

NT, 04 main difficulties had been revealed as shown in Figure 4

Figure 4: Consequences of the business symptoms

- Difficulty to find replacement: in Vietnamese oil & gas industry, the training of

a skilled engineers is very difficult according to the interview results Therefore, as the skilled employees left ITC-HCM, the board of directors got difficult to find replacements Moreover, voluntary employee turnover directly involves cost of hiring and training new employees, cost of lost time until new employees achieve full productivity and cost of unused production capacity during the period of adjustment of new employees (as proposed by Buzeti1) According to Discenza and Gardner, as cited

in Fitch et al2, the financial costs of replacing leaving employees have been roughly estimated at “two to five times their monthly salaries”

- Overwhelming task assignment: As it takes long time to find new replacement, the workload of departing employees were transferred to current employees According

to Hauck3, “the stress construct itself has been positively related to high levels of workload” As a result, depending of the amount of transferred workload, the employees will suffer from varying levels of job stress caused by task overwhelm

- Lower other employees’ morale: Price4 proposed that increased turnover would lower employee satisfaction and, in turn, increased more turnover Larwood5 found that overall job satisfaction also negatively correlated with intention to leave, while Bluedorn6 concluded that there was “a significant positive relationship between leaving intentions and actual leaving behavior” Therefore, the lowered employees’ morale (or

satisfaction) is a critical issue that need to be considered by the director if they want to retain their talented employees

- Changes in overall operational planning: the disruption in human resources will eventually change the operation of the company as well as planning for next period because the board of directors will have to adjust their planning on revenues, budgets and other activities

Moreover, according to the interview with Mr Bac NT (see Table 5), the turnover rate among the engineer segment of the ITC-HCM was about 21%, which was much higher than that in the mother company (which was about 15%) The abnormally high turnover rate, especially within the skilled engineers, had made the ITC-HCM’s board of directors start to investigate the reasons why those engineers left and whether the symptoms would get worse The aims of this study are:

 to investigate the causes leading to employee turnover actions

 to propose the solutions to help retain current employees

2.2 Interview with Admin head officer

The purpose of interview with Admin head officer, who is also in charge of HR activities of the company, is to investigate the causes for turnover situation within ITC-HCM from the perspective of HR person However, the interview with the officer did not reveal the causes for the engineers’ departure because the former engineers did not share with him honestly The given reasons were “serious individual issues”, which were vague and unconvincing The Admin officer also assumed that the departing engineers were not satisfied with the company’ monetary benefits due to lowered revenues (as shown in Table 1) Moreover, the interview gave researcher some benchmarking information as well as relevant recruitment information The possible findings for causes

of turnover action acquired from the interview is proposed as below:

Figure 5: Possible causes leading to turnover actions acquired from interview with

Admin head officer

2.3 Interview with departing engineers

The interview with 2 available former engineers first revealed their reasons to leave, which could be interpreted as following factors: leadership style, project management process, work morale, income, knowledge sharing and relationship with co-workers When researcher proceeded to ask more question related to other possible factors, it showed that both of they were not satisfied with many aspects of the ITC-HCM, which could have raised their intention to leave and eventually led to actual turnover action The findings are combined and summarized in the following diagram:

Figure 6: Summary of causes leading to turnover actions acquired from interviews

with departing engineers After having gathered all information from depth-interviews, there found 5 main groups of causes leading to turnover action of former engineers: 1) Compensation and benefits, 2) Leadership style, 3) Work morale, 4) Work environment, 5) Project management process All of those causes led to the dissatisfaction at work towards

former engineers, leading to their intention to leave and eventually voluntary turnover actions as they found suitable alternative opportunity

2.4 Interview with current working employees

The purpose of these interviews are to verify whether the groups of causes found from interviews with former engineers still exist and affect the current working employees in the company In this phase, the interviews are expanded to both technical engineers and non-technical employees The findings of the interviews are summarized

in the following diagram:

Figure 7: Summary of potential causes of dissatisfaction acquired from interviews

with current employees

From the interviews with current employees, more causes leading to dissatisfaction have been revealed The interviewees showed dissatisfactory feeling towards many aspects in the 5 groups: 1) Decreased compensation and benefits, 2) Leadership style, 3) Lowered work morale, 4) Work environment, 5) Unproductive project management process However, most of them currently do not have intention to leave immediately since they find good trade-offs such as salary, work-life benefits or job security The interviews also show the possible intention to leave from the technical department members while the non-technical members do not However, as they are not satisfied with the company, it is probable that they could leave the company as they have more attractive opportunities

2.5 Initial cause-effect diagram

The initial cause-effect diagram is combined from the findings acquired from all depth interviews Some items are grouped and clarified as shown in Figure 8:

Figure 8: General initial cause-effect diagram for turnover situation in ITC-HCM

III PROBLEM IDENTIFICATION

The initial cause-effect diagram for turnover situation in ITC-HCM is simplified with key determinants:

Figure 9: Simplified initial cause-effect diagram for turnover situation in ITC-HCM

According to Hall and Price7, turnover is “the movement of members across the boundary of organization” There are typically two types of turnover occurred within organization: voluntary turnover -an employee's decision to terminate the employment relationship- and involuntary turnover -an employer's decision to terminate the employment relationship, as described by Shaw et al8 It seemed that “voluntary turnover would be explained by different determinants than involuntary turnover” and

“the attention was concentrated on the members voluntarily leaving the organization”,

as proposed by Price9 The models used to explain for voluntary turnover action vary from Met-expectations model10, Turnover process model11, Job embeddedness model12, Unfolding model of voluntary turnover13, Concept of job satisfaction14

In the context of ITC-HCM, the concept of job satisfaction is more preferable to understand the hidden reasons leading to turnover action and to propose solutions for better employee retention In fact, not only leaving engineers but current working employees show various levels of dissatisfaction to many aspects within the company Therefore, by lowering the dissatisfaction towards employees, it is believed that employees are more likely to stay, as suggested by Selznick et al15 From the interviews

with former and current employees, 05 groups of determinants accounted for the job dissatisfaction and possible turnover action have been defined: Decreased compensation and benefits, Bureaucratic leadership style, Lowered work morale, Toxic work environment and Unproductive project management process From literature research,

6 more determinants are added to the cause-effect diagram to broaden the possible causes leading to employee turnover within state-owned petroleum companies The additional determinants are listed as below:

- Job security16

- Flexible work-family arrangement16 & 17

- Lack of training and development17 & 18

- Performance appraisal and feedback19

- Lack of professional advancement opportunity16, 17 & 19

- Lack of organizational commitment20

3.1 Updated cause-effect diagram

The cause-effect diagram is updated with key determinants The “Alternative opportunity search” is considered an external factor and removed from the diagram

Figure 10: Updated cause-effect diagram with key determinants

 Inappropriate performance and feedback system

According to Poon21, performance appraisal represents “a central function of human resource management” However, the author also points out “there is some evidence that managers deliberately distort subordinates’ performance ratings for political reasons”22, cited in 21 As received performance appraisal ratings are not based on performance factors, employees are likely to experience reduced job satisfaction and tend to “view work place politics as undesirable” As a result, they may “withdraw from the organization as a mean of avoiding political activities”, leading to voluntary employee turnover Igbal19 also mentioned that dishonest and evasive performance

reviews might damage “the self-esteem of the employees” Especially in Saudi Arabia’s collective culture, which are quite similar to Vietnam, “the pay-for-performance system that recognized individuals is undermined” and is viewed as “unfriendly and hostile” by employees Poon21 concludes that “manipulations of performance ratings arising from personal bias and punishment motives have negative effects on job satisfaction and turnover intention” In ITC-HCM, there is no HR department with specific HR activities within the organization; the performance appraisal system is adapted from mother company

 Lack of professional advancement opportunity

Kim17 explains that “lack of promotion opportunities had a significant effect on the decreasing job satisfaction of the federal, white-collar workforce” The author also proposes that “fair opportunity for advancement and promotion will lower turnover intentions to the employees” Igbal19, from his research in Saudi culture, also provides that lack of advancement (or promotion) opportunity “is one of the prime reasons why employees leave organizations” When employees observe limited opportunities for professional or personal advancement in their current jobs, they “prefer

to join other companies which may provide good career growth and good pay packages” Unfair promotion policies perceived by employees may negatively impact their organizational commitment, according to (19) In ITC-HCM, the promotion opportunity might be limited unless employees join the Communist Party The Party will nominate its members for managerial position within the organization and the members have to strictly follow the party’s guidelines and policies

 Lack of job security

Meltz23 defines job security broadly as “an individual remains employed with the same organization with no diminution of seniority, pay, pension rights, etc.” Similarly, Triandis and Herzberg24 defines job security as “the extent to which an organization provides stable employment for employees” Yousef25, from his researches in UAE organizations, proposes that “there is a significant positive correlation, although not very strong, between satisfaction with job security and organizational commitment” Author (16) also provides that for an employee who is the primary earner in a family with children, job security will be highly valued Therefore, the benefits of long public sector

tenure in terms of wages, job security, and pension rights is negatively associated with turnover and decreases turnover intention In ITC-HCM, most employees, including engineers and non-engineers, have signed Indefinite Duration Contract with the company, which guarantee a stable, long tenure job for employees Also, the company pays full Social Insurance for employees to guarantee for future pension

 Inflexible work-family arrangement

Moynihan and Landuyt26, as cited in (16), proposes that “work-family policies offered by public sector organizations are generally more generous than those found in the private sector which could be an incentive not to leave the public sector”, especially for women employees Durst27, as cited in (17), finds that “approximately 52 percent of local, state, and federal agencies surveyed agreed or strongly agreed that family-friendly programs decreased turnover” Many researches also reports that family-friendly program promote job satisfaction, loyalty among employees and enhance employee retention, as mentioned in (17)

 Lack of training and development

Continuous training of the workforce is necessary to ensure that employees are updating their skills Stovel and Bontis28 suggests that training will “increase the employee loyalty, as many employees recognize that company is working to help them their career goals” According to the author, employee training can be conducted through either “on-the-job or off-the-job training practices” On-the-job training “allows employees to work within the firm, while learning about their job and the company” Off-the-job training can include “technology-driven e-learning programs, formal classroom training, and external training conducted by suppliers or formal educational institution” However, according to the interview results with Mr Bac NT (see Table 5), the training and development is not prioritized in ITC-HCM because there are no HR department or specialist in the company All training and development programs are provided from the mother company If one person would like to be trained or funded for their higher education, they have to ask for permission from ITC-HCM’s directors Then the company will send a form to mother company’s HR department for acceptance The process is time-consuming and the employees are not keen on asking for supports of training from the company Instead, they tend to do on-the-job training However, due

to the lack of employee cooperation, as many employees do not want to share their knowledge, it is difficult for effective on-the-job training, especially for junior employees

 Decreased compensation and benefits:

Since the oil recession in year 2014-2015, the company had to encounter sharp decrease in revenues (see Table 1) As a result, in order to balance the financial budget, the company had to change the pre-existing compensation and benefit policy allowed for employees Even though the wages have been unchanged due to the government’s policy, the decrease in work benefits have significantly affected the total financial income of every employee For example, the bonuses and health insurance plan was decreased, travel and fitness support was removed According to 2007 Job Satisfaction29

report by Society for Human Resource Management (SHRM), compensation and benefits were ranked among top five aspects towards employee satisfaction As the compensation and benefits decreased, the employees in ITC-HCM somehow lost their satisfaction with pay, thus leading to turnover intention

 Bureaucratic leadership style:

Dimarco and Norton, as cited in Nguyen30, described bureaucratic structure as “a detailed list of rules, policies and regulations” and concluded that “a low bureaucratic environment would be an ideal place to increase employee satisfaction” Rainey et al31

pointed that the bureaucratic business environment was “influenced by external factors such as laws, rules and oversight activities that the government imposed on the public sector to maintain their control power” Additionally, Hickson et al32 stated that “there were sign of uneven and political decision-making in public organizations” ITC-HCM,

as a state-owned organization, shows similar characteristics as described by the authors

In this organization, the board of directors are dependent on rules, policies and regulations to manage the employees They are less likely to apply new changes unless there are new policies accepted by the mother company Also, the leaders show low-task leadership as they are less competitive in modern market The highly bureaucratic environment like ITC-HCM will result in high employee dissatisfaction eventually

 Unproductive project management process:

In public sectors, since they are highly focused into formal system, they failed to easily adapt new technology and personnel, and to allow for the growth and development of mature personalities as stated by Bennis33 According to Kamoche34, public organizations are unable to change working practices to fulfill the current demand for efficiency due to weak management, loose monitoring, soft budget constraints and limited organizational flexibility In ITC-HCM, the loose management with outsourcing projects leads to lack of task clarity as well as work confusion The consequences include the number of meetings with little clear results between employees with managers The managers keep asking redundant questions many time due to lack of understanding of the current projects As a results, managers ask for many weekly reports as a proof that they are supervising the project carefully However, the reports are too time-consuming and waste a lot of working time of the employee

 Toxic work environment:

Harder35 proposes that an organization “can be considered toxic if it is ineffective

as well as destructive to employees” In his study, he proposed 3 categories of elements

of workplace toxicity: organizational principles, work conditions and intra-office relationship conflicts In ITC-HCM, the intra-office relationship conflicts are quite clear

as there existed a number of unfriendly conversation and arguments among employees Moreover, many senior employees show rude behaviors and obscene words towards other co-worker Sometimes, when they get drunk, they have sexual-harassment-like behaviors towards female employees Moreover, information transparency within the organization is poor as many employees are not willing to share their knowledge and findings with junior ones, making project execution more difficult According to Hsu36, lack of information transparency can lead to “confusion, misinformation and distrust within organizations” To better manage the projects, clear task confusion, knowledge development, and so on, the board of directors in ITC-HCM should promote information transparency

 Lowered work morale:

Guba37 suggests that “high satisfaction must precede high morale in time if the extra energy required for high morale is to be available”, which means low satisfaction does not correspond to high morale In ITC-HCM, the leadership, environment,

management, and compensation and benefit policy, and so on do not satisfy employees, which eventually leads to low work morale The employees feel unproductive at workplace and find less opportunity to develop their skills and careers Studies conducted by many researchers, as cited in Michael et al38, support the hypothesis that turnover is preceded by turnover intention, which are preceded by satisfaction In the Mobley et al39’s model, the job satisfaction gets low, the turnover intention is generated and the action to leave will take place after having perceived alternative employment The departure of employees is consequences of long process initiated by job satisfaction Therefore, in order to retain employees, the board of directors should consider available satisfaction elements and try to improve them

 Low organizational commitment

Organizational commitment is defined as “individuals' belief and trust in organizational goals and values, and affections toward the organization”, mentioned in Ting40 The author proposes that “individuals are likely to become psychologically attached to the organization before they develop affectionate attitudes toward their jobs, and employees often develop job satisfaction consistent with the level of organizational commitment” The author (20) proposes the relationship between commitment and turnover intention in UAE oil industry Meanwhile, the mother company PVEP is a leading company in Vietnam’s oil and gas industry for many years In year of 2017, the company contributed about $6.14 billion to GDP of Vietnam, according to (41) The mother company is in charge of supervising all oil& gas exploration and production activities on Vietnamese continental shelf Therefore, for petroleum engineers, PVEP is great place for working in Vietnam Moreover, due to the company’s security policy (see Table 5), the employees, who are leaving the company, are not allowed to work for any domestic competitors This means they have to commit to the company unless they tend to move to different industry

3.2 Cause justification and problem of interest

To verify the existence of all determinants in updated cause-effect map as well

as their importance, a survey was carried out for 15 working employees in ITC-HCM, consisting of engineers and non-engineers (see Table 11) The results of the survey (see Figure 17) showed that respondents showed most “Disagree” responses toward work

management, leadership style, compensation and benefits These 03 determinants received from 87% to 100% of “Disagree” responses, meaning that employees are most dissatisfied with these determinants In terms of work morale and work environment, the number of “Disagree” responses exceeded 60% of total responses as well Most

“Agree” responses belonged to the job security, commitment and family-friendly policies Respondents show most “Neutral” responses towards training, advancement opportunity and performance appraisal

From the quantitative findings, it can be concluded that the most serious issues

in ITC-HCM for employee turnover are 1)Unproductive project management process, 2) Bureaucratic leadership style and 3)Decreased compensation and benefits However, after having considered each issue, the researcher finds out that it’s not possible to adjust the leadership style as well as the compensation and benefits of the organization The director is the head of the organization and the leading decision-maker, his personalities

or leadership style may not be adjusted in short period of time On the other hand, the compensation and benefit policy of ITC-HCM relies heavily on the mother company and its business situation During the period of oil recession since year 2014, the revenue

of ITC-HCM, as well as the mother company, is not possible to improve quickly The benefits, as a result, is difficult to be adjusted solely by the managers Therefore, the research will focus into solving the most critical issue “Unproductive project management process”

3.3 Importance of interested problem

By improving productivity of project management, the company can utilize its human and time resources, as well as bring high quality to the project results As a result, the firm’s performance will be improved in terms of revenues and brand Melián-González et al42 points out that a number of researches found “a significant relationship between aggregated employee satisfaction and performance at the business-unit level” The author proposes that employees in well-performed organizations often share a positive outlook; they have norms of collaboration and are more engaged and motivated

to “work toward organizational goals” Campion et al43 suggests that employee cooperation, or collaboration, can be promoted by effective workgroup process as well

As the employees are satisfied and motivated, the work morale, which is positively

linked to satisfaction, is enhanced accordingly Angle44 suggests that “there is a strong relationship between organizational commitment and organizational effectiveness” Although the researchers could not strongly prove the effect of firm performance with employee collaboration, commitment, there is an evident relationship between those factors

The advantages which could be brought by productive project management are illustrated in following diagram:

Figure 11: Possible advantages from Productive project management

With the “Unproductive project management process” chosen as interested issue, the updated cause-effect diagram with focus into Unproductive project management process is shown in following figure:

Figure 12: Updated cause-effect diagram with focus into interested issue

3.4 Cause validation for focused problem

The causes for Unproductive project management process is validated by interviewing a senior project leader who is working in ITC-HCM He confirmed that these causes existed and explained for each causes:

 Lack of task clarity: The assignment is conveyed by word-of-mouth or emails with unclear objectives and requirements It does not allow feedbacks from members as they need help from leader for encountered issues Members have to wait for leader’s response to clarify and there are a lot of complaints for late or no responses

 Loose management: The leader do not regularly monitor the performance as well

as the progress directly with members They only use members’ reports to update progress without understanding actual progress or difficulties of the projects and do not provide troubleshooting immediately when members get difficulties Therefore, the project quality is not guaranteed in time schedule and quality In fact, 11 of total 16 projects in 2017 were behind deadline and suffered from clients’ complaints

 Inappropriate report system: the report template is made in MS Excel and members have to manually type in and submit to leaders However, the template is too long with many excel formulas but do not reflect the actual status of project The time spent on making one report could take a whole working day for submission

To clarify the unproductivity of in project management of ITC-HCM, a typical project, named Alpha for confidential reason, has been analyzed The S-curve diagram showing the planned and actual progress (in percentage) versus time for the project has been constructed as shown in Figure 13:

Figure 13: S-curve diagram for Alpha project

The project started smoothly as the both progress curve matched with each other But the actual progress gradually declined and the gap between planned and actual progress expanded with time The maximum of difference reached almost 30% after half

of proposed time frame As a result, the time was delayed by 20-25% of the planned

time frame This delay is explained by the project leader as the “lack of productive working time” due to many lack of task clarity, loose management and too many reports

The productive working time is calculated by the following formula:

Productive working time = Actual working time contributed for project

8∗number of working dayThe productive working time observed for Alpha project was calculated to be about 50-60% The lowest value dropped to 50% during the execution period (from week 2 to week 17) and was explained by the lack of time for reports, technical meetings

to clear task assignments and confusions Even though there are no benchmarking from competitors, the number of productive working time reaching 60% is critically low, causing delay of project and increase of spent resources

For work group effectiveness, Cummings45 emphasized on the knowledge sharing through functional assignments and reporting system Moreover, Gladtstein46

proposed effective work group process by promoting goal and role clarity, open communication and supportiveness For the issues in project management process in ITC-HCM, the researcher realize there lacks an effective management tool that enables knowledge and information sharing from members to members and members to leaders The project conducted in ITC-HCM is a process done by 2-3 teams (see Figure 2) The data and information transparency is very important to ensure smooth execution of a project By allowing good knowledge and information sharing, the leaders will manage the project quality and time schedule better and quickly adjust when trouble occurs Also, as the knowledge of the project is well understood by members and leaders, the members will concentrate more on their functional task rather than reporting to leaders and leader can keep track of the progress easier Moreover, when information is clear and easily transmitted, each team can easily inherit from doing of previous team, making the work transfer easier

The final cause-effect diagram is proposed as follows:

Figure 14: Final cause-effect diagram

IV PROPOSED SOLUTIONS AND ACTION PLAN

4.1 Proposed solutions

Nowadays, with the help of technology, project management gets easier by

adapting modern management systems There are several well-known system such as SAP (Systems, Applications & Products in Data Processing), Microsoft Dynamics AX

or Infor CloudSuite For the size of ITC-HCM and the project characteristics,

researcher suggests to adapt the ProjectManager platform, which is illustrated on its website https://www.projectmanager.com/

The advantages of the platform includes:

 Planning: creates interactive Gantt charts online with detailed task assignments and clear time schedule for each member, allows online tasks update and document

uploads

 Task management: easily manages task list, updates and shares tasks with other members, instantly alerts with emails or phone notification

 Collaboration: quick update for resource allocation, allows team chat and

private chat for easy communication, easy document sharing within the system

 Team management: keeps track of each member’s progress, quickly updates

work progress status and responds, allows real-time communication by providing

immediate directions and feedbacks; fast troubleshoots and resource re-allocation

 Time tracking: quickly keeps track of time and progress online with detailed

timesheet assigned, easily approves/rejects task updates

 Reports: instant customized reports with multiple visual charts, notification to team and each member for their reports and adjustments