Development strategies for project profit margin improvement in project planning and scheduling

Abstract

The market for industrial projects is extremely competitive; technology, project time duration, and cost play crucial roles in securing the projects from the customers. Improving the project profit margin during the project execution and after the contract is signed is not an easy one, but we all need it. In projects, the project duration, start date, and end date are fixed, and it is obligatory to fulfil the contractual requirements within the agreed project duration. The projects are being executed by project management; project planning and scheduling is one of the supporting processes for project management. The project duration is controlled in this process, and the project scheduling tool provides the guidance to deliver the deliverables on time. The project schedule has been prepared for the work packages, and the deadlines for the deliverables are scheduled. The optimization of project duration is highly essential, and the project planning and scheduling processes and tools should be lean. The shorter project duration during execution increases the project profit margin. The on-time completion of project activities ensures profitability and avoids liquidated damages.

The thesis aims to maximize efficiency and minimize waste to improve the project profit margin in the existing and new projects. Efficiency can be improved by applying efficiency concepts such as flow efficiency, and resource efficiency in the project planning and scheduling processes, tools, and resources. Eliminating waste is achievable by applying lean 8 types of waste in the process, tools, and resources. Improvements in efficiency and waste elimination provide remarkable cost savings during project execution, which in turn lead to improved project profit margins. The lean theoretical frameworks are applied to the existing processes, and improvement opportunities are identified. The primary data for this thesis research is collected from surveys. The secondary data for this thesis research is collected from interviews. The project management professionals from different regions participated in both surveys and interviews, which provided a wide range of inputs and ideas. The development strategies identified to improve the project profit margin are discussed and communicated to the stakeholders. Action to implement the development strategies is planned.

This thesis is done in association with Valmet Technologies Oy, Tampere, Finland.