This document discusses the poor project management of Leatty's construction project in Shanghai, China. The project was delayed by 16% over budget and 2 months behind schedule due to several factors. These included design changes by the architects, supply chain issues that increased material costs and delayed deliveries, difficulties accessing the construction site due to road work, and weather challenges. Additionally, poor communication between the multinational team from different countries exacerbated delays. To get the project back on track, a new project manager implemented solutions like internet training to improve information sharing, adjusting meeting times for different time zones, and enhancing risk management and contingency planning.

1. Leatty Shanghai – An example of poor project management in construction
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MINISTRY OF EDUCATION AND TRAINING
UNIVERSITY OF PEDAGOGY OF HO CHI MINH CITY
DEPARTMENT OF ENGLISH
SUBJECT OF READING BE6

LEATTY SHANGHAI
AN EXAMPLE OF POOR PROJECT MANAGEMENT
IN CONSTRUCTION
SUPERVISOR: Mr. Vu Quoc Anh Truong Son
CLASS : 3TMA
MEMBERS : Dang Phi Hai
Le Vuong Nhat Nghi
Nguyen Chau Phu
Nguyen Thi Hong Tham
Nguyen Minh Thu
Dao Anh Tuan
Nguyen Do Hoang Tu
Nguyen Huynh Tuong Vi
HCMUP May, 2014

2. Leatty Shanghai – An example of poor project management in construction
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3. Leatty Shanghai – An example of poor project management in construction
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LEATTY SHANGHAI
An example of poor project management in construction
While a business is a continuous and long-term operation, a project, on the
other hand, is a temporary and short-term venture aiming at a specific product or
service. In order to make a project successful, a complete process consisting of
planning, executing, monitoring, and evaluating is needed. We call it “the project
management” – the driving force behind any venture to keep everything under
control. Effective project management can push a project forward to reach its
objectives. On the contrary, poor project management will slow down productivity,
hold back creativity, or even kill a project entirely. Let’s take Leatty’s construction
project in Shanghai as an example.
Leatty, who is a major property developer involved in several projects in
China, has embraced its latest project in terms of the construction of new generation
buildings in Shanghai. This project is designed to include a three-phase housing
development, as well as a shopping and
leisure center. The team is multinational, with
the developer coming from Canada, the
architects from Germany and the
multinational team of structural engineers and
contractors from Shanghai. The completion of
the first phase was due 12 months after the
start date. Although this project is claimed to
be using the most cutting-edge technologies in the world, it has been facing a lot of
delays in its construction site owing to many factors. The squad is now nine months
into the work and conservative estimates suggest that the project is already 16
percent over budget and two months behind schedule. A new project manager has
been called to rescue the troubled project to come up with some effective solutions
to put it back on track.
The construction site using the latest
technologies in the world

4. Leatty Shanghai – An example of poor project management in construction
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First of all, the factors causing postponements are derived from the inside of
the project. In the formative stage of development, the architects decided to
redesign the plan and changed the project schedule. It took over three weeks for the
architects’ revised plan to reach the contractor. These design changes also delayed
the delivery of structural steel because the foundations could not be ready on time.
Furthermore, the price of steel has increased because “demand exceeds supply” in
the steel market. Along with storage issue, this resulted in suspense in steel delivery
and cost exceeding. This is not the way that matches the planning process with the
executing stage effectively. Moreover, government road building work caused many
difficulties for the large construction
materials to enter the building place. This
held up the start of the excavation since
larger equipment could not reach the site
until late December while the start date
was November 1st in the schedule.
Another delay was caused by the building
contractor who was responsible for the
foundation work, but it turned out that he was unable to comply with the new start
date. In the economic crisis, the contractors fared ill with financial issues. In
addition, they had to execute the unfinished projects, so the shortage of manpower
and equipment was another reason for delays. Last but not least, the weather
conditions were harsh and it was a huge obstacle to work around the clock under the
heat wave of summer months in China which could be up to 35oC. These serious
matters have fetched out that the old project manager was not such a good visionary
leader that can put everything under control.
Besides, there were problems with relationships between the client and the
various contractors and consultants. In specific, Germany and Chinese people, who
always focused on preserving a very high quality, preferred to work with paper-
Leatty Shanghai project in China

5. Leatty Shanghai – An example of poor project management in construction
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based system rather than Internet-based one. In fact, the telecommunication system
was not helping but causing duplicating and missing work. No face-to-face
information exchange and different time zones also made it more difficult to
exchange information and solve matters. Not to mention that there is no common
goal among the team members, together with the unrealistic and aggressive
schedules which took part in creating misunderstanding and friction. There is no
denying that poor communication among the multinational crew has led to the
postponement of this project.
To tackle this critical problem, some realistic solutions have been drawn out.
It is suggested that the project manager should initiate a training course to help the
team be more familiar with the internet-
based application in order to improve the
information exchange among the
workforce; hence, the project is likely to
be smoother and more productive. In
addition, the meeting time is a matter of
concern to the multinational team, so
teleconferences will be held at 8:00 in
Toronto, 14:00 in Berlin and 20:00 in Shanghai. There should also be a quarterly
face-to-face meeting with a few representatives of each party. They should
encourage the engineers with their recent achievement and create a team-building
program to let everyone get to know each other, which will be good for the squad’s
morale. Moreover, the information exchange with the government has to be
enhanced to decrease risks of suspense at the point of road works.
Obviously, there is a tight link between project management and budget.
Instead of relying on a single supplier, it is advisable that the project manager
should consult more subcontractors or suppliers to increase competition and keep
costs as low as possible, and renegotiate contracts with the main suppliers for Leatty
which may include fees for delays as well. Besides, it is suggested that
The differences in time zones make it hard
to conduct teleconferences.

6. Leatty Shanghai – An example of poor project management in construction
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the project crew should be established to give regular updates about Leatty and
provide a forecast for some risks of postponements to avoid costs. Dividing the
working hours into smaller shifts or building a climate dome to avoid heat is not a
bad idea to keep the work on track within the budget.
On the whole, Leatty’s construction project in Shanghai is a typical example
of a poor project management. The project was delayed due to a lot of factors,
especially the poor communication among the multinational team. Correspondingly,
some internet training courses need setting up and the meeting time has to be
changed in order to exchange information much more easily among the crew. In
terms of the second and the third phase of the construction project, the new project
squad will place great emphasis on the matters that caused delays to the
construction of the building. This seems to become an essential element
contributing to the success of Leatty Shanghai. In addition, the manager should find
some standby suppliers in case of the rapid rise in material costs. It can be clearly
seen that these changes may occur quickly, and are likely to take unpredictable
forms and appear in unforeseen ways. This is an important issue which needs to be
taken into careful consideration in managing projects. Otherwise, the company will
take the bull by the horns and struggle in finding the path to success.