1 University of Economics and Finance University of Economics and Finance Feasibility Study – The critical success factor in project management Lê Quốc Thành - Engineer, BA, MA PhD Student in CFVG 2 Lý lịch giảng viên Lý lịch giảng viên + Học vấn : • PhD Student in CFVG - 2010 • Thạc sỹ kinh tế phát triển Việt Nam –Hà Lan (ĐH KTHCM & Viện ISS Hà Lan - www.iss.nl) năm 2003. • Cử nhân Kinh tế - ĐH Ngoại thương – 1999. • Đào tạo Quản lý chuyên ngành Hàng Hải tại Nhật Bản 1996, và ĐH Chalmer –Goteborg - Thụy điển 1997. • Kỹ sư hàng hải – ĐH Hàng hải - 1994. + Kinh nghiệm làm việc : • 1994-1998: Cục hàng hải Việt Nam, Ban quản lý DA đường thuỷ -Bộ GTVT. • 1999-2000 : Chuyên viên kinh doanh – Tập đoàn Sumitomo • 2003 - đến nay : Phó phòng Dự án Hạ Tầng - Tập đoàn Mitsui Nhật Bản tại Việt Nam. 3 Lý lịch giảng viên (Tt.) Lý lịch giảng viên (Tt.) + Các dự án đã & đang tham gia : - Nghiên cứu Tiền khả thi Dự án Phục hồi vận tải ven biển Việt Nam 1994-1996 ( JICA - Nhật Bản). - Dự án 2 tuyến đường thuỷ phía Nam 1995-2002 (World Bank, 80mil USD). - Dự án Thuỷ điện Đại Ninh – Lâm Đồng (300 Mil USD, 2004) - Dự án khí Cà Mau (đường ống khí 240 Mil USD, 2005). - Dự án lắp đặt thiết bị điều khiển phần RFCC ( 2,8 Mil USD, Nhà máy lọc dầu Dung Quất, 2007). - Nghiên cứu khả thi dự án đường sắt Bình Thuận Tây Nguyên, 2008 (TEDI-PCI). - Dự án Mua bán-Sáp nhập Cảng khu vực Thị Vải-Cái Mép ( M&A), 30 mil USD ( 2008-2009). - Trưởng điều phối Nghiên cứu tiền khả thi Dự án Cảng trung chuyển Than ( 100,000 DWT, 2009). - Country Coordinator, Long An Desalination Water Plant (Mitsui-GS) - Country Coordinator, LNG Regasification Plant ( PVN and others) 4 Một số nguyên tắc nghiên cứu Một số nguyên tắc nghiên cứu trên lớp trên lớp • Không chỉ là lớp học : mà là lớp Thảo Luận. • Có ý kiến – Nêu ra ngay. Có ý tưởng - Viết ra ngay. • Khuyến khích tranh luận  Có kết luận. • Kết luận chưa hẳn là kết quả cuối cùng, mà có thể là một bước tiến tới kết quả mong muốn. • Chúng ta sẽ học được của Nhau Nhiều qua thảo luận. What is matter? What we are going to do? How? What is the next step? 5 Main Content Main Content I. Basic concepts of project and project management II. Project life cycle in reality. III. What is Feasibility Study? IV. Outline of Feasibility Study. How to develop a Feasibility Study? V. Case Study of Feasibility Study VI. Free Discussion : Q & A 6 I. Basic concepts of project I. Basic concepts of project management management 1. Non-profit project : • Run by NGO or International Organizations for purposes of charity, international relationship or politics • Focus in the field of agriculture (technology transfer), education, public health improvement, fighting poverty, social study or culture, etc. 2. Investment project : • Mainly invested by private sectors and public sector (state-owned companies) • Financial purpose is the most important criteria to invest 7 Investment project can be divided Investment project can be divided (1) Non-facility project (non-physical project): Merger and Acquisition project, Biz Improvement Project, Enterprise restructuring project, etc  No equipment is installed ( Paper work only) (2) Facility project (Physical project): - Most important projects in economy. - Requires large capital, manpower, equipment and construction works. - Take several years for preparation and implementation - Project life is 20, 30 years or more - Play most important role in economic growth of country 8 Facility project Facility project • All projects that we could see by our EYE is facility project • Road, railway, bridge, high building, power plant, factory, new car model design : facility project. • Can be divided : (1) infrastructure & basic industry projects that its product ( or result) will mainly be input for other industries : electricity plant, water supply, (2) Consumer project that supply products to people, households. 9 Infrastructure project Infrastructure project • The fields : Oil and Gas sector, Power, Transportation, steel, chemical, construction materials, water supply, etc. • Provide the basic need for economy • Strong country need Perfect Infrastructure • In 2009, VN would spend around 39% of GDP for facility project. • Dungquat Refinery : would be 3 bil USD. • Benthanh-Suoitien metro line : 1.2 bil USD 10 II. Project life cycle in reality. II. Project life cycle in reality. • Generally, project life can be (1) concept (2) development, (3)implementation , (4) termination and hand-over for operation • In reality of Vietnam, project can be divided into 4 groups (Decree 12/2009) (1) National Project such as Assembly House, investment decision made by National assembly (2) Group A : decided by Prime Minister (3) Group B : usually decided by Minister or Chairman of Province or CEO of National Economic Group such as PetroVietnam, EVN, Vinacomin, VNPT, etc. (4) Group C : usually decided by medium enterprises • Each kind of project have different stages in development and implementation. [...]... experienced in similar or nearby project before • Well knowledge and good senses in Human Resource Management And the soft skills should be obtained: • Organizing , problem solving, conflict management • Communication skill and leadership • Presentation skill 19 V Case Study • International project invested by foreign investor in Vietnam : The water supply project near HCM City • Project Information... questions • Topic questions : - Feasibility Study and others 21 Suggestion of reading documents • For those who pursue professional career in project management : www.pmi.org, PMBOK 4th Edition • For those who pursue professional career in project finance : accounting, project management in general, financial risk, contract management, project finance lehaiduong68@gmail.com www.vietproject.org “Chúc Học viên... manage? 14 III Outline of F/S (Cont.) • Business administration model : production management, marketing and sale management, maintenance  operation management  operational cost of project in operational phase • Other issues : copy right, social issues, trade name, ( if any)  cost to manage these issues? • Training requirements/cost to make sure the operation • Risk factor  risk management  risk... spend 95% of total project cost  It means that F/S is very important 12 Other name of F/S • Preliminary Feasibility Study (Pre-F/S)  Detailed Feasibility Study ( F/S) • Business Plan : for short term • F/S is for long term including engineering design • F/S includes Project Execution Plan 13 III Outline of F/S • Cover sheet • Content • Executive Summary : general description of project/ its products... How to proceed the F/S by ourselves • We do by ourselves when : - The project is small or medium scale - Not complicated engineering requirement • What should we do first ? - Selection of Project Manager and leave all the rest to him - Project manager will select and manage the project team including many kind of experts : legal, market, technical, finance, sale, operation, etc 18 Who is project manager?... study in preparation period of investment • Hitachi confirm that 75% of total cost of their project is decided in design period ( Design is one phase in F/S) • Mazda confirmed that 50% of product quality is decided by design • Until the time of F/S completion, project owner just spent around 5% of total project cost • If F/S confirm that the project is feasible, project owner may invest and they shall... for investment Implementation of investment Investment license Operation Payment Hand-over Supervision Bidding Contracts signing Tender Documents 2 Years FEED Total Cost Estimate F/S Consultant FS Pre FS Concept Report Master Plan Operation Contractors PMC Consultant 2 Years 2-4 Years Project life cycle in Reality 11 III What is the Feasibility Study • F/S is final study of project  most important study. .. III Outline of F/S (Cont.) • - Financial analysis : Projected balance sheet Income statement Projected cash flow NPV, IRR, B/C, PP, etc How to arrange the finance for project Financial risk and how to manage Conclusion and suggestion 16 IV How to proceed the F/S + Pre-Condition to proceed F/S : • We should have business idea Or • We are requested to follow an business idea + We have two main ways to... employ the professional consultant to proceed F/S and we need one or two good experts to carry out double check (2) We have good experts as project team and proceed the F/S by ourselves • - Who is good consultant ? Operated in many years or had many consultant contracts Professional in consultant ( mainly doing consultant work) Having good experts in various fields : market analysis, engineer, financial... F/S • Project Introduction : Detailed description about project, legal framework for project, project owners, etc • Description of products or Services : - Demand analysis of products - Which segment (quality) and which price could be accepted at such quality - Current and future competitors • Technology and services to launch the products into market : - Technology flow chart to manufacture the products . Economics and Finance University of Economics and Finance Feasibility Study – The critical success factor in project management Lê Quốc Thành - Engineer, BA,. What is the Feasibility Study III. What is the Feasibility Study • F/S is final study of project  most important study in preparation period of investment. • Hitachi