Process analysis and imrpovement at dat hop co ltd

Notes: Please refer to Appendix | for detailed processes Technical department: General process; Verifying process; Repairing equipment process; Guarantee of equipment process; Calling

HO CHI MINH CITY OPEN UNIVERSITY UNIVERSITE LIBRE DE BRUXELLES

SOLVAY BRUSSELS SCHOOL OF ECONOMICS & MANAGEMENT MBQPM5

BIEN, TRAN VAN

PROCESS ANALYSIS AND IMPROVEMENT AT DAT HOP CO LTD

MASTER FINAL PROJECT MASTER IN BUSINESS QUALITY AND PERFORMANCE MANAGEMENT

Tutor: Jacques Martin

Ho Chi Minh City (2016)

Table of Contents

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Chapter 1: Identifying they key DUSINESS PrOCESSES .sccssesseesnessessneerecsneesnesseesesnsenneeseesnes 16

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Chapter 2: Managing processes systematically

1 Fulfill the key process in ID card:

2 Flowchart:

PART 2: MEASURING AND IMPROVING PROCESS

Chapter 1: Setting improvement targetS ii

1 Work out the Balanced Scorecard (BSC): series

3 Empowering process-owners to Set targets: ccsessessssssssssessesseetssecsesseeeaeneessensseseeseen AD

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5 Collect data from internal and external CUStOMETS: ssseecsseesneersseersnesssnecenessneeenneeenaee 51

Chapter 2: Using innovation and creativity to improve process@s - - ‹ -‹.92

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FMECA analysis and action plan:

Feature metrics and dashboard:

Adopting self-managed teams:

4 Evaluating performance and reporting:

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APPENDIGES 5, scervecorcensessnoscooreosscsservatycoovesetsovvassondeosecsvessnstsed ounseegsensttosstavstconsssssvessasseustonsse@stso

Appendix Ï: DAT HOP ORGANIZATION CHART -.52-ecticcerrerrreerrrerrr 8

Appendix II: EXISTING PROCESSES

Appendix Ill: PROCESS ID CARD

Appendix IV: OWN PATTERNS AND INDUSTRY INNOVATION ANALYSIS

Appendix V: INNOVATION STRATEGY FORM .ssssssssssssessssssessessssessnsssssessnnessnssessessssessseese

Appendix Vi: FMECA FORM csssssssesssssesnscssssnsesssssecssessscsnscnessnessussnsesssenscsssenseanesseesseesseeseesee LDQ

Rental Department Technical Department Environmental Consultancy Department Accounting Department

Information Technology Department Department of Natural Resource and Environment

Figure 01: Dat Hop Co Ltd’s picture at Vung Tau beach

2 Organization structure:

- Dat Hop Co Ltd’s organization structure includes Director, Advisory board and

09 functional Departments such as Marketing, Import and Export/Purchasing, Sales, Rental, Environment Consultancy, Technical, Accounting, Information and Technology, and Administrative At the present we have total 35 employees

10

DAT HOP COLTD’s ORGANIZATION STRUCTURE

DIRECTOR

ADVISOR BOARD

Staffs Staffs Staffs Staffs Staffs Staffs Staffs Staffs Staffs

Figure,02: Dat Hop Co Ltd’s organization structure

Core business:

Dat Hop Co Ltd includes core services such as importing and exporting/purchasing, retailing/sales, rental, calibration services for measuring equipment, and environmental consultancy services (including of bio-chemical products) especially

Indeed, we have been importing measuring equipment's and its software from over the world for sea and land surveying field We have focused on quality of product So, we have had partner/supplier from the United State, United Kingdom, German, Switzerland, Taiwan, Japan, and China After importing/purchasing equipment from oversea we retail them for the whole market of Viet Nam but included of Cambodia and Lao

We understood that services after sales are very importance to satisfy customer needs and concurrently build up our reputation So, at the beginning

we have focused on calibration services for both our sold equipment’s and equipment’s sold by other companies

Actually the budget for each project is always different since the size of those projects is different So, we have developed rental services for almost kind of equipment we imported for sales

Besides that we also understood that the need of Environmental Consulting services from Projects or Clients we are working for So, we have not only provided our Customer surveying equipment’s, but also offered them Environmental Consulting services (establishing of Environmental Assessment Impact (EIA) report and wastes treatment consulting)

a)

Figure 03: Dat Hop Co Ltd’s core services

Resources:

Dat Hop Co Ltd has gathered up teams of active and fervour employees who were educated and trained by famous Universities in Viet Nam such as University of Economic Ho Chi Minh City, Ho Chi Minh City University of Technology, University of Transport and Communication, etc Now we are one

of leading company providing land and sea surveying equipment in Viet Nam

We strong believe that bringing the trustful services to Customer

Up to 2030 Dat Hop Co Ltd will become leading in the field of providing solutions and land surveying and sea surveying’s equipment's, environment consulting in Viet Nam

Mission:

Revenue VND 400 billion per year in 2030;

Becoming exclusive representative distributor of at least one of three leading brand name (Leica);

Leading on providing surveying equipment’s and technology solutions for land and sea surveying field;

Controlling/taking up Southern Viet Nam market and opening the market on the whole Viet Nam and South-East Asian area

Strategic goals:

Growth revenue 20% per year;

Continuing innovation and always pioneer in applying innovative processes of management, human resource, and services;

Customer satisfaction and two- way engagement;

Workforce satisfaction and two- way engagement;

Corporate social responsibility

Strategy map:

Then, | will develop Dat Hop Co Ltd’s strategy map based on Balanced Scorecards (BSC)’s perspectives BSC model basically includes four perspectives such as Customer, Financial, Internal business processes, and Learning and growth

| believe that this strategy map is the vehicle by which | ensure that our scorecards have balanced Strategy map also allows me to see how perspectives of this model are linked and work toward achieving our strategic objectives

Presentation of subject:

The thesis will identify existing processes of Dat Hop Co Ltd The processes are included of from each department Then they will be analysed to find out key processes and critical points accordingly Continuously, recommendations are proposed to improve existing processes and enhance company competition ability and business productivity

Interest of subject:

The thesis will bring our Director visual picture of processes belong departments We understand clearly about our position in compared with our competitors and we will know exact our strength need to be motivated and weak points need to be supported and improved

Furthermore, the thesis will bring company a general innovative plan in order

to adapt with changes are rapidly development in the real world

Objectives:

Ensuring improved processes will support our business carried out smoothly and perfectly The processes will contribute to reach our strategic goals (20% revenue growth per year, .), mission, vision They will contribute to build up friendly environmental working and bring the best services to Customer

14

Of-course the report will also including of Preface, Acknowledgement, List of abbreviation, Introduction, Conclusion, References and Appendices

Notes: Please refer to Appendix | for detailed processes

Technical department:

General process;

Verifying process;

Repairing equipment process;

Guarantee of equipment process;

Calling customer process;

Solving complains process;

Notes: Please refer to Appendix | for detailed processes

Environment consultancy department:

Submitting Documentation process to DONRE (Natural Resource and Environment Division);

Implementation process of monitoring environment report;

Implementation process of detailed subject report;

Implementation process of Environment !mpact Assessment (EIA) report; Implementation process of Simple environmental assurance subject;

Implementation process of Environmental assurance plan report;

Implementation process of Registration book of own waste outlet

Notes: Please refer to Appendix | for detailed processes

* Chemical and Biological products team:

Selling process via telephone;

Selling process at Company;

Customer searching process;

Calling customer process;

Delivering and acceptance of product process

Notes: Please refer to Appendix | for detailed processes

Accounting department:

Export good for selling process;

Export good for rental, repairing, or borrowing process;

Advance and advance payment process (Advance process; Advance payment process);

Collecting and spending cash process (Collecting cash process; Spending cash process);

Banking depositing and withdraw process (Deposit cash into Bank account process; Withdrawn cash from Bank account process);

Storing process of imported products and local purchased products;

Follow-up bad debt process;

Follow-up liabilities of debt process;

Purchasing fixed asset process;

Process of preparing Value Added Tax (VAT) report;

International payment and Liquidation of custom declaration process (International payment process (Advanced payment process; Net payment process); Liquidation of custom declaration process)

PART 1: MANAGING PROCESS

Chapter 1: Identifying they key business processes

1 Key processes:

1.1 Company processes:

Each department has own processes to ensure their works is carried out smoothly and effectively It is included but not limited to as the following:

Sales department (Hydrographic products):

Customer searching process;

Selling process;

Calling customer process;

Delivering and acceptance of product process;

Customer care and solving complains process;

Borrowing and give back equipment process;

Receiving, warranty and repairing equipment process

Notes:-Please refer to Appendix | for detailed processes

Sales department (Surveying equipment):

Customer searching process;

Selling process;

Calling customer process;

Delivering and acceptance of product process;

Complains process

Notes: Please refer to Appendix | for detailed processes

Import and export/Purchasing department:

Importing product process;

Local purchasing process;

Customs declaration and receiving the good process;

Asking for import permission process;

Return the good back process;

Checking documentation process

Notes: Please refer to Appendix | for detailed processes

Rental department:

Preparing rental papers process

Customer searching process;

Customer evaluation process;

Customer care process

Rental process (Process of delivering equipment at Dat Hop Co Ltd’s office;

“Process of receiving equipment back from.customer);

Calling customer process A ol

THU WHER,

Notes: Please refer to Appendix | for detail processes

1.2 Key processes:

Following details processes, | suppose that there are 10 key processes which

belong to sales, purchasing, rental, and accounting department In specific as

the following:

(1) Customer searching process;

(2) Selling process;

(3) Importing product process;

(4) Customs declaration and receiving the good process;

(5) Customer care and solving complains process;

(6) Repairing equipment process;

(7) Submitting Documentation process to DONRE (Natural Resource and

Environment Division);

(8) International payment process;

(9) Follow-up bad debt process;

(10) Follow-up liabilities of debt process

2 Mapping processes:

[ Biological pro

[ Surveying pro | Environment | Rental | Rental

Eny, service [Environment] | Environment

Information/Skils

Marketing

and Planning Risk management

Figure 05: Dat Hop Co Ltd’s process map

Chapter 2: Managing processes systematically

1 Fulfill the key process in ID card:

1.1 Customer searching process:

CUSTOMER SEARCHING PROCESS

Input

Figure 4-2: Dat Hop Co Ltd’s selling process

1.3 Importing product process:

19

(satisfaction)

importing product process

1.4 Customs declaration process and receiving the good process:

Customs declaration and receiving the good process

Declaration Checkng, Pekup

1.5 Customer care and solving complains process:

Customercare and solving complains process

Repairing equipment process

(failures)

(from supplier)

4.9 Follow-up bad debt process:

1 technical, environment) Searching

2 |Chief/Sales person Classifying

T

Ỷ

2.3 Importing product process:

Depts (sales, technical,

2.4 Custom declaration process and receiving the good process:

26

2.5 Customer care and solving complains process:

Dept (sales, rental,

1 |technical, environment) + Customer list

2.6 Repairing equipment process:

2.8 International payment process:

2.7 Submitting Documentation process to DONRE (Natural Resource and

Environment Division):

‡

8 Environment depfs Print and

9 Customer/Environment Signed by Cutomer

dept's staff and re-submit

2.9 Follow-up bad debt process:

41 |Accounting dept Observation book

2.10 Follow-up liabilities of debt process:

PART 2: MEASURING AND IMPROVING PROCESS

Chapter 1: Setting improvement targets

Work out the Balanced Scorecard (BSC):

Following strategy map then | would transfer Dat Hop Co Ltd’s strategic goals into planning throughout establishing company BSC

Objectives:

Financial objectives are put into four groups as follows:

+ Expanding opportunities to increasing revenue;

+ Reinforcing and increasing Customer's added-value;

+ Increasing efficiency of work of whole company;

+ Improving expenses structure

+ For “reinforcing and increasing Customer’s added-value” objective: it is measured through out selling more than one product per one existing Customer

+ For increasing efficiency of work of whole company” objective: it is measured through out (i) increasing 20% company working efficiency by target management and KPI, (ii) reward employee on gained revenue; + For “improving expenses structure” objective: it is measured throughout (i) reducing input cost/base cost of product imported from oversea (more competitive input cost), (ii) reducing worse debt, (iii) reducing operation costs throughout carrying out process, procedure correctly and minimizing redundant and wrong tasks, (iv) well controlling storage: quick cycle, reducing stock, (v) controlling proper expenses to saving costs

0) Increasing Y increasing > 20% + Set up KPI

revenue

Improving | Vreducing - | si | evaluation

—_ | deb Yreducing , vNew worse process; M

operation debt < 0.5% per | V Sales

storage; (Director and v Salesperson

¥ Controlling Checking › is trained

proper expenses to 1/month

Table 01: Financial Scorecard Perspectives

Customer objectives are put into four groups as follows:

+ Optimal pricing of product and service;

+ Providing the best customer care and guarantee services;

+ Providing integrated bundles of solutions

on market demand, (2) offering good price for close customer and accumulating score for customer type A, (3) offering lower price for

customer accept advanced payment, (4) incentive policy on price for education sector);

+ For “Providing the best customer care and guarantee services” objective: it

is measured throughout (i) establishing service policies for customer who owns project frequently; (ii) exceeding customer expectation in consulting, technical support, and fixing technical errors of products; (iii) commitment to time delivery of product;

+ For “Providing integrated bundles of solutions” objective: it is measured throughout (i) enhancing sales ability; (ii) motivating launching program of product, service, periodic training on year; (ii) observing the project throughout classifying project and setting up “follow-up” process details and periodically; (iii) providing complete solutions included equipment, software, and accessories

c) Targets:

+ Atleast 2 more suppliers for new products a year;

+ Lower 10 customer complaints caused by sales, repairing, verifying and guarantee services;

+ 100% contract is provided by integrated bundles of solutions

d) Initiatives:

initiatives as the following:

+ Setting up KPI evaluation system;

+ Building and standardization internal business processes of sales, importing, accounting, technical;

+ Setting up CRM/Excel database + automation + closed feedback loop;

+ Salesperson is trained

e) Summary of Customer Scorecard Perspectives:

Scorecard

policy

¥ Providing service policies incentive policy evaluation

c)

qd)

Targets:

Following financial objectives, its targets are identified as follows:

+ 20% growth revenue per year (for next year our revenue target is VND 40 billion in which first quarter should be upper VND 8 billion; second quarter should be upper VND 10 billion; third quarter should be upper VND 10 billion; and fourth quarter should be upper VND 12 billion);

+ Atleast 30% existing customer being purchase other products and services; + Increasing 20% productivity of the whole company;

+ Reducing improper costs by checking 1/month

Initiatives:

Then, Financial objectives and its targets will be reached by setting up initiatives as the following:

+ Setting up KPI evaluation system;

+ Building and standardization internal business processes of sales, importing, accounting, technical;

e) Summary of Financial Scorecard Perspectives:

Financial Objectives Measurement | Targets Initiatives

Customer on Facebook marketing

ng 6ñ customer in process;

Glistomer and natural is trained

recourse from

South-western area;

¥30 “big”

Customers/year

Reinforcing ¥ Selling more | > 60 customers/ | v Set up KPI

v Salesperson

is trained

guarantee frequently; v Late delivery < 12 standardization services v exceeding times/year

customer expectation in consulting, technical support, and fixing technical errors of

products;

¥ Commitment

to time delivery

of product

+ ¥ enhancing v¥ 100% salesperson v Set up KPI

bundles of v motivating training courses system;

classifying ¥ 100%

project and setting up

“follow-up”

Table 02: Customer Scorecard Perspectives

1.3 Internal Business Process perspectives

Internal business process objectives are put into four groups as follows:

+ The customer management;

+ For “The operations” objective: it is measured throughout (i) purchasing process; (ii) storage management process; (iii) management process to operational costs and management costs;

+ For “The innovation” objective: it is measured throughout (i) searching new products process; (ii) launching new products process (launching or relaunching product);

+ For “The complying process against state regulations” objective: it is measured throughout (i) enhancing corporate socio-responsibility process Targets:

Following internal business process objectives, its targets are identified as follows:

+ Maximum 03 days for custom declaration procedures;

+ Maximum 10 days for shipping period by air (from date of confirmation by manufacturer to date of the goods arrived Dat Hop Co Ltd storage);

+ Maximum 20 days for shipping period by sea (for Asian area from date of confirmation by manufacturer to date of the goods arrived Dat Hop Co Ltd storage);

+ Maximum 50 days for shipping period by sea (for European and US area from date of confirmation by manufacturer to date of the goods arrived Dat Hop Co Ltd storage);

+ At least 03 launching or relaunching new product programs/year and at least 150 attendance/program;

+ Atleast 01 community or charitable program

e) Summary of Internal business process Scorecard Perspectives:

Setting up KPI evaluation system;

Establishing marketing department;

Internal process standardization;

Setting up CRM/Excel database + automation + closed feedback loop;

management process: build up | (implementing and system;

brand name, then evaluating); v Salesperson showroom, the ¥ 08 meetings/year is trained;

*⁄approaching implementing database +

customer/project | v 12 customers or closed belong public agents/year; feedback loop sector; v New process/sales

¥ selecting and | dept approved by approaching Director in first process to quarter;

potential ¥ 100% calling to customer customer before actively; schedule date

¥ Customer care service after sales process;

(v) setting up keeping customer process

vThe ¥ purchasing ¥03 days for custom | ¥ Set up KPI

management shipping period by ¥ Internal

v¥ Management ¥ 20 days for standardization

+ For “Developing information resource” objective: it is measured throughout (i) setting up information management system and customer care (CRM); (ii) using applications of Stack and Trello;

+ For “Building up company culture sustainably” objective: it is measured throughout (i) sharing culture of acknowledgement and skills; (ii) enhancing self-awareness spirit, responsibility against corporate, and union and inter- relationship spirit between divisions; (iii) corporate culture: Honest, Professional, Innovative, Dedicated, Responsible

c) Targets:

- Following learning and growth objectives, its targets are identified as follows:

+ Company organizes at least 01 sales training per week;

+ Company will send chief of department (included sales, technical) for oversea training at least 01 time a year;

+ Key staffs will be attended at least leadership or management training course a year;

+ Installing and guiding CRM, Stack, or Trello software for use successfully;

+ 100 % person shares their acknowledgement or skills at least 01 time per month (in turn);

+ Organizing at least 02 activities team per quarter as scheduled by labour union;

+ 100% staffs attend company’s culture meeting to discuss about “Honest, Professional, Innovative, Dedicated, Responsible”

d) Initiatives:

- Then, learning and growth objectives and its targets will be reached by setting

up initiatives as the following:

+ Setting up KPI evaluation system;

Sorborate specialized ability; | v.01 oversea system;

la Vv skills of training/chief of ¥ Training

leadership, dept (sales, program

management, technical);

works allocation ¥01 leadership or

applications of Stack and Trello

and creating management motivation to training

person/year

¥ setting up v Installing and ¥ CRM license;

Mà veloping information guiding for use ¥ Stack and Trello

system and customer care

spirit between union/quarterly;

¥ corporate attend company’s culture: Honest, culture meeting

Professional, Innovative, Dedicated,

¥ Communication

Table 04: Learning and Growth Scorecard Perspectives

2 The key process quality objectives and related targets and metrics:

2.1 Customer searching process:

a) Company objectives:

- Dept of Sales, Rental, Technical, and Environment should gain 20% growth of new customer per year

b) Process goals:

- Increasing number of potential customer to ensure 20% growth per year;

- Transforming potential customer to customer;

- Recording outstanding, weak points to improve our services

process to shipping period by operational costs | sea (Asian area);

management shipping period by costs sea (European area);

v¥ Weekly report

VThe ¥ searching new | V New process v Set up KPI

process; ¥03 launching or re- | system;

¥ launching new | launching ¥ Establishing

(launching or attendances/program

relaunching product) VThe v Enhancing - v01 programlyear vSet up KPI complying corporate SOCiO- (for community or evaluation

against state regulations

Table 03: Internal Business Process Scorecard Perspectives

1.4 Learning and Growth perspective

a)

b)

Learning and growth scorecard is fourth perspective of Kaplan and Norton’s Balanced Scorecard model Establishing of this scorecard will enhance Dat Hop Co Ltd’s employee productivity to ensuring the long-term growth of company

Objectives:

Learning and growth objectives are put into four groups as follows:

+ Developing skills of corporate human;

+ Developing information resource;

+ Building up company culture sustainably

e)

Targets:

100% Customer is to take care regularly

>20% New customer per year

Metrics:

Number Customer/Total calling for Customer;

Number new customer/Total Customer

The key process ID card:

Refer to Appendix III: PROCESS ID CARD

Provide customer qualified goods and on time delivery as commitment,

Saving time for customer, sales department and others;

Provide customer services exceed their expectation

Targets:

>98% conformity of good is delivered;

>95% delivering the good on time;

<2% complaint by customer

Metrics:

Number conformity of good/total delivered good;

Number delivery on time/total number of delivery;

Number complaints/total number customer is buying goods

The key process ID card:

Refer to Appendix II: PROCESS ID CARD

2.3 Importing product process:

Import qualified products with proper price;

Ensuring delivery schedule requested by Sales Depts;

Optimal costs such as product cost, transportation cost, customs fee, storage fee

e)

Targets:

100% conformity of good is imported

>95% importing the good on time

Metrics:

Number conformity of good/total imported good

Number importing on time/total number of importing

The key process ID card:

Refer to Appendix Ill: PROCESS ID CARD

2.4 Custom declaration process and receiving the good process:

The good arrived warehouse on time;

Optimal storage of good at customs warehouse

Targets:

>95% order arrives company warehouse on time

<5% stored goods at customs warehouse

Metrics:

Number order arrives on time/total order

Number stored order/total order

The key process ID card:

Refer to Appendix III: PROCESS ID CARD

2.5 Customer care and solving complains process:

a) Company objectives:

All Customers are to take care regularly and their concerning are figured out timely

Process goals:

Customers are to take care regularly;

Getting Customer's feedback on quality of products and services;

Solving Customer's concerning and problems as soon as possible

Targets:

100% customer is to take care regularly

>95% got feed backs from customer

>90% complaint is solved

e) The key process ID card:

2.8 International payment process:

a) Company objectives:

- No overdue payment

b) Process goals:

- Ensuring correct payment;

- Avoiding overdue payment;

- Maintaining good relationship with manufacturers

- Number conformity of good/total delivered good;

- Number correct payment/total payment

e) The key process ID card:

- Refer to Appendix III: PROCESS ID CARD

2.9 Follow-up bad debt process:

a) Company objectives:

- Maintaining bad debt below 3% of total debt

b) Process goals:

- Control! bad debt below limited threshold;

- Improve cash flow;

c) Targets:

- 95% bad debt is recovered

d) Metrics:

- Amount of recovered bad debt/total bad debt

e) The key process ID card:

- Refer to Appendix III: PROCESS ID CARD

2.10 Follow-up liabilities of debt process:

a) Company objectives: