PROJECT MANAGEMENT

ASSIGNMENT 1 – MANUFACTURING
SECTOR
According to Cushman & Wakefield report, Malaysia has been ranked as world’s utmost
suitable location for manufacturing expansion and relocation. Several factors were
considered in this report; broadly as costs, risk and conditions, (Business Circle, 2014).
Malaysia scores predominantly well in the costs and risks factors, justifying its position at
the top of the ranking; the country is one of the least expensive locations within the report
index [refer table 1].

With Malaysia moving steadily towards a diversified service-based economy, the next
wave of business and investment opportunities is probable to be in high-value
manufacturing. This area is still largely untapped by local and foreign companies.
Malaysia needs to focus on manufacturing sector to increase its export market valuation,
to make the country’s growth more sustainable.

Since independence in 1957, Malaysia has achieved promising development of its

manufacturing sector and of its overall economy. Initially being highly dependent upon
natural resources, it diversified its natural resources mostly into palm oil production.
While developing some manufacturing industries that are derived from its natural
resource bases; Malaysia also developed into industries unrelated to natural sources.
Noticeably, it developed its electrical and electronics manufacturing with automobile and
steel industry. Nevertheless, it is totally implausible that Malaysia can become a high-
income economy by abandoning the manufacturing sector and radically re-focusing its
economy towards the service sector. For the development of manufacturing sector,
Malaysia needs to develop its current national technological capabilities; with sustainable
investments in machinery, education, training, and R&D supported by better regulatory
policies.

These investments and supporting policies won’t come easy and will take time to bear
fruit. However, Malaysia’s current strategy, based upon the New Economic Model that
clearly recognizes the need to upgrade national productive capabilities, makes one
cautiously hopeful for the country’s future. The promotion of private sector must be
within regulations neither less regulation. The linkages between production and
innovation need to be emphasized. Without productive enterprises, little useful
innovation will happen, so it is important to establish close collaboration between
productive enterprises and research bodies.

SMEs cover almost 90% of the Malaysia’s manufacturing sector and produce various
types of products such as textile and apparel, food and beverages, metals and metals
products and wood and wood products, (Saleh et al, 2006). At the same time, SMEs also
face a couple of domestic and global challenges. One of the challenges is SMEs have a
low level of R&D. This is because they have insufficient engineering and technical skills.
Other than that, SMEs put almost its efforts on supplying for the domestic market and at
the same time they have to compete with products from China and India. From here, it is
obvious that they already set the highest limit for their potential. To overcome these
challenges, SMEs should aim high and they have to be bold and qualify enough to export
their products to overseas. The high level of bureaucracy in government agencies in one
of the challenges for SMEs. There is not enough internal sourcing funds for SMEs and
the SMEs believe the available funds are not effectively delivered. The Malaysian
government should avoid delivering the funds through too many agencies to make sure
the funds is effectively delivered. Other than that, it is suggested that SMEs should try to
implement counter-trade to help them getting financially stable.

Manufacturing sector deemed important for the growth of Malaysian economy.

Manufacturing industries comprises different level and set of expertise to achieve desired
objectives. Since, the collaboration of different departments within manufacturing
business is very crucial. Hence, the objectives achievement seems unable and inefficient.
As SMEs constitute a major part of the manufacturing sector, and in difficulties to sustain
in the industry. The each objective achievement in the business sector should be treated
as a project. When different people meet for the same interest, the probability to achieve
objectives is higher. The project management is the application of processes, methods,
knowledge, skills, and experienced to achieve planned objectives.

The insufficient innovation and planning with in the manufacturing sector leads towards
the undesired results. The interference of project management into the manufacturing
industries, acknowledges planning and allocating limited resources. The Malaysian
manufacturing sector depends upon natural resources, and if allocation of these resources
are unplanned; more chances of being them wasted. This unethical behavior of the
industries may leads to collateral damage of premonitory Malaysian growth.

Project management creates a time frame, and the organization should be bound to it for
its success. The time framing gives a motivation and drive to the team to achieve specific
objectives. When something is bound within a circle, people thrive to achieve more.
Similarly, for instance in a automobile manufacturing plant, the designing and
manufacturing of a new vehicle should be planned and time bounded to persuade team to
achieve in a specific time using resources efficiently and effectively.

The project management helps to divide the complete task into different activities, the
accomplishment of these activities leads towards the success. Some activities within the
project are critical and affect the overall success of the project. These activities need to be
completed on time, to complete the project in time without using extra capital; human
and financial. Considering the automobile manufacturing industry, the assembling of
engine into the chassis before interior and exterior detailing is crucial. If the engine is not
mounted of the frame on its specific time, it will delay all the other predeceasing
activities and might delay the project.

According to Mobey and Parker (2002), to increase the chances of a project succeeding it
is necessary for the organization to have an understanding of what are the critical success
factors, to systematically and quantitatively assess these critical factors, anticipating
possible effects, and then choose appropriate methods of dealing with them. Once
identified, the success of the project can be achieved.

The delays in the project occur when a project team executes a project outside their
comfort zone, stress is placed on both the tools and project team. When a project is larger
than the comfort zone of a company, stresses are placed on the ability to provide
experience and appropriate work processes, and the results are typically cost overruns
and schedule delays. To mitigate this stress, some companies will divide large projects
into smaller projects and execute the smaller projects with separate dedicated staff and
resources. The key to success then becomes the coordination of the small projects to
behave as if they are one large project.

When a company is executing a project that is much smaller than the company norm,
resources are often misused and inappropriate work processes are utilized. The result
often increases the project costs. Some companies with a history of executing large
projects have set up a small project group to execute smaller projects. These groups
establish a different culture, develop appropriate work processes, and use tools designed
to execute smaller projects.

Decisions that influence the outcome of the project, such as a delay to the project
completion date or an increase in the project costs, typically involve the client. Some
clients prefer to make the final decision, with the project manager developing alternative
solutions with a cost-benefit analysis of each of the alternatives. The final decisions taken
by the clients can delay the project from its planned completion date and can leads to cost
overrun. Others prefer to be involved in discussions to better understand the barriers,
developing alternative solutions and making decisions in a team environment.
Understanding the client’s decision-making preference and developing procedures and
processes that support that preference is important to meeting client expectations and
finishing the project on time. For instance, a high-tech industry is developing a
equipment to be used in a manufacturing line. The equipment will enable the production
line to be automated, but in time changes and additional requirements after the project
have been started by the manufacturing industry may delay the project from its specified
course. The importance of top management support by being active stakeholders and the
clarity of goals throughout the project management and implementation stage are found
to be strong factors that must be present to ensure a successful project outcome (Kuen et
al, 2008).

During the life of a project, the project team encounters a large number of small problems
that can cause small delays. A thunderstorm caused the loss of electricity in the office
building, and the bidders’ conference had to be delayed one day; a computer virus shut
down the use of computers, causing the loss of another day; and the airplane flights were
late, so the project reviews were one day late. None of these events caused significant
problems for the project, but together they add up to delays that could affect the end date
of the project. These delays continue to add up, then the project end date will begin to
slip. As the project nears the completion date, the team will work overtime, decisions will
be rushed, and resources will be added to the project to avoid missing the project end
date. This type of end-of- project atmosphere will leave a strong lasting impression with
the client and usually does not produce a satisfied client.

If the project manager delegates too little authority to others to make decisions and take
action, the lack of a timely decision or lack of action will cause delays on the project.
Delegating too much authority to others who do not have the knowledge, skills, or
information will typically cause problems that result in delay or increased cost to the
project. Finding the right balance of delegation is a critical project management skill.

The causes specified can leads towards the shift in the scope of the project and the track
specified in the planning. The delays in the project will incur more cost than the budgeted
and may affect the reputation of the organization. The small problems need to be handled
by the project manager efficiently, as they sums up to bigger losses. The planning of the
project should be intensively thorough and can incur more time. In turn, it will help the
project manager to run the project smoothly. The factors that affect the critical activity of
the project needs to considered before as they affect the duration of the project. If some
non-critical activities affecting the critical activity, that also need to taken into
consideration.

The project management within the manufacturing sector can helps to achieve the desired
objectives within time period. The resources will also be utilized efficiently. The
combining different people to form a team will enable to achieve milestones. The project
management divides the task into different activities, which can be monitored easily.
Hence, if the project is under-supervised or been neglected can lead to cost overrun
through delay in the completion time or wastage of resources. Project Management is
very crucial for manufacturing sector, to sustain in this complex society. The possibility
to achieve near to perfection manufacturing can be possible due to indulgence of project
management. As Malaysia wants to join developed nations’ club till 2020, the project
management implementation should be a part of each sector, especially manufacturing.
APPENDIX

Figure 1: Manufatcuring Index

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Ha-Joon Chang. (2012). The Manufacturing Sector and the Future of Malaysia’s
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