1 UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business Tran Minh Tam LACK OF COORDINATION AT HBC’S CONTRACT DEPARTMENT MASTER OF BUSINESS (HONOURS) Ho Chi Minh City – Year 2019 2[.]
UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business Tran Minh Tam LACK OF COORDINATION AT HBC’S CONTRACT DEPARTMENT MASTER OF BUSINESS (HONOURS) Ho Chi Minh City – Year 2019 UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business Tran Minh Tam LACK OF COORDINATION AT HBC’S CONTRACT DEPARTMENT MASTER OF BUSINESS (HONOURS) SUPERVISOR: Professor Doan Anh Tuan Ho Chi Minh City – Year 2019 LACK OF COORDINATION AT HBC’S CONTRACT DEPARTMENT Table of Contents Executive Summary Company Overview 1.1 Hoa Binh Construction Group J.S.C 1.2 Contract Department Symptoms High and increasing Days sales outstanding Problem identification 10 3.1 Potential problems 10 3.1.1 Inefficient project coordination at Site and in back office 10 3.1.2 Lack of long-time working employees 12 3.1.3 Lack of coordination within the department 12 3.2 Validating problems 15 3.2.1 Problem Validating 1: Inefficient project coordination at Site and in back office 15 3.2.2 Problem Validating 2: Lack of long-time working employees 17 3.2.3 Problem Validating 3: Lack of coordination within the department 18 3.3 The important and consequences of the problem 20 Cause validations 23 4.1 Potential causes 25 4.1.1 Work Overload 25 4.1.2 Poor Communication 25 4.1.3 Lack of work-interaction 26 4.2 Causes Validation 26 4.2.1 Validating the first cause: Work Overload 26 4.2.2 Validating the second cause: Poor communication 30 4.2.3 Validating the third cause: Lack of work-interaction within the department 31 Alternative solutions 34 Solution – Provide orientation and internal knowledge sharing class 34 Solution – Setting goal and specific tasks for employees in HBC E-learning System 37 Action plan 40 Supporting information 40 7.1 Interviewees‟ Demographic 40 7.2 Interview Guide 40 References 43 Appendices 47 Appendix 1: Definition of theoretical frameworks 47 Appendix 2: Form of proposal 48 Appendix 3: Bidding results in 2019 of HBC (1st and 2nd quarter only) 52 Appendix 4: Days sales outstanding of HBC, CTD and PHC 57 Appendix 5: Transcript summary 58 LIST OF ABBREVIATIONS HBC Hoa Binh Construction Group Joint Stock Company DSO Days sales outstanding EPC Engineering, Procurement, Construction CTD Coteccons Construction Joint Stock Company PHC Phuc Hung Holdings., JSC UEH University of Economics Ho Chi Minh City UOL University of Law Ho Chi Minh City QS Quality Surveyor AR Account Receivable LIST OF TABLES Table 1: Data of net sales, average account receivable, account receivable turnover ratio and day sales outstanding from January, 2015 to December, 2018 in HBC Table 2: Data of due dated value of 10 on-going biggest projects from 2015 to 2019 in HBC 11 Table 3: Data of personnel in Contract Department in 2019 in HBC 12 Table 4: Data of payment in Sunshine City Saigon Project in HBC 15 Table - The assignment of the Main-contract execution of the Contract Department during the 2019 period – quarter 1, 29 Table - The assignment of the Subcontract execution of the Contract Department during the 2019 period (with ONG = Ongoing, STO = Stop, COM = Completed) 29 Table Estimated costs of two alternative solutions 40 Table - Action plan of two selected solutions from June 2019 to January 2020 39 Table - Interviewees’ Demographic 40 TABLE OF FIGURES Figure 1: A part of HBC organizational structure Figure 2: Contract Department ‘s organizational structure Figure 3: Data of day sales outstanding from January, 2015 to December, 2018 in HBC, CTD and PHC Figure 4: Contract Executive job’s description in executing Main Contract in HBC 19 Figure - The display of HBC E-learning system (http://www.el.hbcr.vn) 38 LIST OF DIAGRAMS Diagram 1: Initial cause-effect map of Contract Department in HBC 14 Diagram 2: Updated cause-effect map of Contract Department in HBC 24 Diagram 3: Final cause-effect map of Contract Department in HBC 33 Executive Summary Over the last couple of years, the development of Hoa Binh Construction Group J.S.C has been significantly recognized in the construction industry However, during the difficult times ahead that construction companies are about to encounter, constantly increasing in account receivable has been recorded as a cautious signal in financial report of the company This paper is about to give a full picture of how a typical construction company struggling to find the solutions to solve the mentioned symptom By first, the researcher gives a short portrait of the company Then, by some intensive working, the author identified an apparently seen symptom before using some techniques data including qualitative research such as focus group to establish three potential problems, follow then by reviewing literature and further conducted an in-depth interview in confirming the main problem and its important and consequences The research also gives further look at the potential causes and once again validating them to find the main cause and sub-causes in order to give the rightful solutions for an agency to improve Throughout the research, readers may find there are still some connection and contrast in and between the literature found and the answer received from the interviewees, as well as the difference in perception of people from the executive level, to the deputy manager level and to the director level The paper also pointed out some limit of the focus group technique to get the clearer picture at the symptoms and potential problems of the company Furthermore, the solution is given to enhance the effort of cure the department problem first, before having affection to the symptoms of the company Company Overview 1.1 Hoa Binh Construction Group J.S.C Having just celebrated their 30th anniversary in operating in 2017, Hoa Binh Construction Group J.S.C (HBC) – one of the pioneers in the construction industry, has gained itself a valuable image in the market HBC has been constantly awarded billions contract over the years, especially as the role of the General contractor (EPC), Main contractor and Design and Build Contractor The mission of the company was once to become the leading construction company in Vietnam, however, the company has been expanding their mission to become one of the competent contractor in the world, beginning in Canada, Australia and Myanmar The company started his first sign when allowing the Hyundai Elevator to buy stocks and get the first control of the company, the private placement of shares to foreign partners will be completed in the second quarter of 2019 The overall of 2018 saw the company revue increase times over the year of 2015 and the profit is even more impressive in figures, increase as almost times over the year of 2015 Source: HBC‟s website (www.hbcr.vn) Figure 1: A part of HBC organizational structure 1.2 Contract Department As the contractor, it could be clearly seen that companies has to compete to get the jobs among the other competitors When things going the right way, that means when the HBC is awarded the contract, there has to be a department who takes the responsibility of review, negotiate and draft the contract for signing That being said, such people shall own knowledge in a mixed between the construction field and the legal one The Contract Department was established with the aim to (i) Review, negotiate and draft the Main Contract with Owners/ Developers, (ii) Check the approved budget with the approved Subcontractors before review, negotiate and draft subcontract with Subcontractors, (iii) to coordinate with other departments in the company system to complete the general mission of HBC Figure 2: Contract Department „s organizational structure It can be seen in the Figure that Contract Department is one of the four Departments located in the Supply Division The Contract Department is led by Mr Nguyen Le Tan - the Director of the Supply Division and Mrs Nguyen Thi Hoan Deputy Contract Manager During the operation over the last few years, some symptoms of the company has been recorded Therefore, this thesis will indicate those symptoms and investigate whether there is an existence in those symptoms and the role of the Contract Department In other words, the purpose is to analyze the link between the causes, effects and symptoms Symptoms High and increasing Days sales outstanding For construction companies the monthly bills or draws to the Owners of the construction projects constitute an account receivable until the bill is paid (1) It is inevitably seen from the financial reports for over the last 04 years that the receivables of HBC gradually increases According to Bryk (2), in case the company needs to get cash to meet its obligations with other parties since Owners/Developers are paying late, it could bring up many financing charges Incurring overdue account receivable still has a cost Instead of having free cash-flow to put resources into development opportunities, purchase new machinery or establish new items, your money is tied up on balance sheet Keeping the account receivables too high may have seriously affected on the cash flow of the company, and therefore the company has to delay the payments to any suppliers or vendors as the case maybe The Account Receivable Turnover Ratio and days sales outstanding of HBC at the average of 2018 is 1.79 and 203.49 respectively, it means that the company collects the receivables about 1.79 times a year or once every 203 days In other words, when HBC makes a credit sale, it will take the company 203 days to collect the cash from that sale Item Net sales (1) Average Account Receivable (2) 2015 2016 2017 2018 5,078,027,249,288 10,766,205,824,099 16,037,264,026,609 18,201,392,136,460 4,212,399,847,452 5,493,455,146,390 7,982,600,863,350 10,147,610,601,259 From a macroeconomic point of view, García‐ Teruel (13) states that level of account receivable is affected by the economic situation Credit collections depend on the industry (14), and effects of negative macroeconomic shocks (15) In a worsening economic and market conditions, some Owner/Developers cannot pay the payment on time, causing the company increases their receivable However, data showing that the Sunshine City (Owner of the project above) has consistently awarded HBC many news contract in 2019 When we taking a further look into some details in Appendix we could see that Sunshine City awarded HBC in the first quarter of 2019 over 800 billion VND contract in north of Vietnam, and over 300 billion contract in the south of Vietnam One of the signs that an organization lacks coordination is delay When there is a lack of coordination between management, labor, production and sales, delays will result causing the organization to become ineffective When delays become part of the operations of the organization, customer relations will suffer for the organization Delays create unreliability and will alienate customers from the organization By controlling and properly managing work in progress, the organization can work to prevent delays and resulting coordination problems Another sign of a lack of coordination within an organization is redundancy With redundancy, an organization will spend double the effort, material and time to produce the same item twice Redundancy typically results from a lack of coordination between various departments within the organization By implementing control measures to reduce redundancies, an organization can work toward improving overall coordination within the organization Organizations must effectively utilize information to function at an optimal level When this information is not readily available as needed within the organization, the lack of information can create a cascading effect that will damage the organization Lack of coordination creates gaps in the acquisition and distribution of information This in turn makes the organization's available resources ineffective and causes it to miss opportunities By implementing an accountability system for the 22 information, the organization can improve coordination and minimize lost information When an organization does not support coordinated efforts, innovation and progress can become stagnant within it This can make the organization obsolete and unable to compete against other organizations in the same industry that have adopted a coordinated effort to adapting new methods of producing and managing the organization Inflexibility also freezes many protocols that could have potentially become productive This happens because there is not enough coordination to gauge the effectiveness of the new protocol In conclusion, from an internal point of view, the Lack of coordination within the Department after going through focus group, literature and in-depth interview with Mr Tan, all showing that this is the problem the author is looking for Cause validations In line with the previous analysis and based on literature reviews, some potential causes of the central problem are identified in the diagram which is the updated cause- effect map of the department as below: 23 Diagram 2: Updated cause-effect map of Contract Department in HBC 24 4.1 Potential causes 4.1.1 Work Overload According to Qaiser et al (16) his journal proved that work over-load, negative affectivity, work-family conflict and family-work conflict has a positive association with emotional exhaustion though co-worker support helps to moderate the relationship between Indeed, having to a lot of work to prevent people from interaction with each other, therefore leading to increase in stress, turnover intentions, and lower job satisfaction (17) Also proved in his work, Farooqi et al (18) said that the relationship of work overload on job satisfaction and relationship of job satisfaction on employee performance, employee engagement which is most important thing of any organization The working overload may come from the lack of interaction between the people in the department as communication tactics allow management teams to coordinate successfully without becoming overloaded and successful coordination and freedom from overload independency influence team performance (19) 4.1.2 Poor Communication Correspondence among colleagues could enhance collaboration in the working environment because of it removes some uncertainty in the relationship and misunderstanding among the co-workers (20) It is inevitably that communication is recognized as an essential key to an effective and solid workplace that generates the employee satisfaction, engagement and enhance organizational performance In other words, with communication, employees will be more cooperative and motivated if they are given adequate opportunities (21) What can be understood in common that communication consists of sharing and using information while lacking of correspondence results from insufficient information, 25 managers‟ use of proper communication practices should offer an effective means to increase cooperation and reduce employee vagueness (22) 4.1.3 Lack of work-interaction According to Heaphy et al (23), employees‟ bodies are influenced by ordinary interactions and, in so doing, encourages a stronger tie between human physiology and organizational research, social interactions has a positive affection on human and hierarchical settings influence worker motivation and physiological creativity Advancing every day positive work–home interaction and day by day positive home–work interaction activities have helped employees in dealing with their numerous of roles and obligations, which features the significance of analyzing the positive impacts that work and home could have on one another (24) In his interdisciplinary research, Schmidt (25) said that interactions between administrators from one viewpoint, and the data sources accessible in the control room are the methods the administrators working in pairs to monitor the overall process and/or the other‟s activity Interactions sure does can help to monitor the other‟s activity 4.2 Causes Validation The validating step is conducted to identify which cause has the real effect on the main problem that the reader has mentioned before By first the writer doing some literature review and interviewed the level of members in the department, before went to the Contract Director to confirm such finding 4.2.1 Validating the first cause: Work Overload As it mentioned before and also has the same idea, Ali et al (18) said that stress in the workplace owing to various problems such as work overload, conduct of coworkers becomes detrimental not to himself but to the organization This stress can be reduced by giving training, orientation, proper pay package equal employee opportunities (26) 26 Respectively, the writer went straight to the office to find if there are actually signs of being – work overload by the employees By confirming the cause, the writer has done some observation techniques to have the prior picture By observation, he could see that the company has the working time to end at 04:30pm, and he find it interestingly that almost everyone in the department leaves the room at such time There is rarely working overtime or overnight This may be a subjective finding as it could be explained for the high efficiency and high performance that leads to unnecessary additional working Also confirm the doubt, Kuschel, (27) said that there is a strong relationship between the concept and measurement of working time and workload: work overload and working long hours seem to be two faces of the same coin Therefore, realized that further interview is needed, the interview has conducted the second group interview within the following date with the participant of all members in the Contract Department except for the Director of course The purpose of the meeting is to make a further looking to which cause has been the central cause leading to the problem, by examining all of the three above-mentioned potential causes Most of them, except for the newbies, admitted that there work-load is heavy and even though they are not used to working overtime, they have to work really and extra hard during the working time Mr Van Anh expressed that she felt sick and emotional exhaustion all of the time, as the consequences of working overload Her expression is same as a research conducted in India that said people have work overload they can be shown with these signs like over sleepy, they become ill, not interested in anything as a result intellectual calibre will suffer (28) Ms Hoan disagrees with the discussion, telling that there are three ways to know if the people is overloaded by the job: The Main contract they are handling are too much The Sub-contract they are handling are too much The Main and sub-contract they are handling are too much To confirm this, Haksever et al (29) said that the level of information overload is at its highest in situations where the contractors interact with the consultants and architect in 27 the design stage, and with subcontractors in the construction/completion stage That being said, the construction stage has the highest probability of information overload, followed by the design stage (30) Most of HBC‟s contract are construction contract, over 90% of bid winning is for construction contract, the remaining is for Design & Build Contract As deputy manager, Ms Hoan takes control of assigning the job and control their performance and make any corrections if needed However, as we mentioned before, in spite of being the one of the powerful people the department, most of them not ask for her approval during their job execution That is how she assigns the job: Assign someone a new Tender documents to follow during the pre-bidding stage and such people go on the executing in the Contract negotiation and management stage After receiving the proposal for Subcontract of people in the Site for e.g in the Appendix 02, she assigns to the people who, may or may not, manages of the Main Contract of such Subcontract to execute the job Such manage work shall include drafting the Subcontract, discuss and negotiation of people in Site and Subcontractors/ Suppliers to final the Contract, prepare for signing and scanning the Contract before sending via email to such related people which has the authority to view and execute such contract Assign to one people a Main Contract management and the Subcontract of such or different Main Contract The following table shows how the Main Assignment is divided to people of the Departments (details of such value and more information shall be seen in Appendix 03) STT Quarter Name Assignees I Cityland Z751 Hoan I Sol Villa Tung I Hai Quan Shopping Mall Van Anh I Vinh Long Shopping Mall Hoan 28 II Celadon City Van Anh I,II Vincity Grand Park (4 packges) Tran II Nitori Ba Ria Van Anh I,II Sunshine City Saigon (Everrich 3) packages Hoan II Tay Ninh hanging cap Ngoc Table - The assignment of the Main-contract execution of the Contract Department during the 2019 period – quarter 1, The following tables shows how the Subcontract Assignment is divided to people of the Departments HOAN VAN ANH QUYEN TRAN NGỌC TUNG TỔNG ONG STO COM TOTAL 13 0 13 213 53 375 218 746 0 10 50 35 26 156 263 61 412 245 912 Table - The assignment of the Subcontract execution of the Contract Department during the 2019 period (with ONG = Ongoing, STO = Stop, COM = Completed) Such assignments are made by Ms Hoan and carbon copy (c.c) to the Director for acknowledgement The table clearly shows that the work load of members in the Department is quite stable and average, the people who more in the Main Contract usually less in the Subcontract, therefore, the work-load is seen to be balanced between people in the department Also, thanks to the elaborated ISO System and the power gifted for her, Ms Hoan shall have the authority to review all of the working time of all people in the department, she confirms that there are lack of overtime working also Such 29 reference shall be seen as this is not the main cause of the problem leading to the lack of coordination problem 4.2.2 Validating the second cause: Poor communication Most problems that occur within the construction industry are linked to be caused by poor communication (31) Also agreed with that idea, poor communication which is described as an unsuccessful interaction between the project participants is common problem in the construction industry (32) This lack of interaction may form between people working on Site construction with back office According to Hussain et al (33), managers and organizations working in the construction industry are needed to know the causes and effect of lack communication and to take necessary activities in their projects to enhance the communication process To validate this cause, Ms Hoan has expressed her thought towards the situation, by telling that their feeling towards each other is good, there is no hate or dislike among them However, due to their strong personality, the communication and the solidarity are not very strong There are still some vacations within the Department every year and a lot of party has been created during the working time or after work and their communication through the journey or commitment to the party is also fine Even though this is a very sensitive cause to validate, by observation, the writer still observes people in the Department involving in different and private groups of social media group, like Ms Liên involving in a group of different department (Material Department which sitting next to ours), Ms Quyen, Ms Tran and Ms Ngoc involving in a private group or Ms Hoan and Mr Tung are going very well together in both on-work and off-work activities, while Ms Van Anh not want to join or involve or get close to the others Such different groups among the department may cause incoherent relationship, but overall, they all actually having fun together as Ms Hoan said The interview of Mr Tan was short, but what could be summary about his thought makes the writer feeling surprisingly, Mr Tan was asked about the poor communication among them and his answer was quoted that “It‟s not poor, they are still communicating with each other very well, but when it comes to the work, 30 there were still something missing and lacking in and between them, but it is not poor communication” 4.2.3 Validating the third cause: Lack of work-interaction within the department For a construction company, management of Main Contract and Subcontract are different by nature By value and by its importance, management of Main Contract requires a much deeper and more experience level of the executors while for the Subcontract, difficult only come from the side of handling and negotiating with suppliers and subcontractors Lack of work interaction may not cause from the way of people interacting but the others, it may depend on the jobs assignment and by nature of the Work For people like Ms Tran, Ms Hoan, Ms Van Anh, they rarely did the Subcontractor Works, but for people like Mr Tung, Ms Quyen, Ms Ngoc – who has less experience than the former, did not involve in much of the Main Contract Works Therefore, as time goes by, people keep doing perfectly their job, it has nothing wrong, but the lack of work-interactions happens and unintentionally leads to the lack of coordination among these people, even though people sitting together and having good communication between By having a deeper interview with Ms Hoan and Mr Tan, the results indicate that this is an obvious cause of the finding In their expression, they admitted that it has nothing wrong with the job assignment, but when people like Ms Van Anh, Ms Tran received the assignment for a new Main Contract, they rarely go to the other ideas or opinion as reference and not go through Ms Hoan – who is the deputy managers and much younger than them, but has much more experience than them and they also not look up and get what has been changes to the Subcontract procedure (34) said that age differences between leaders and supporters can also influence leadership efficiency It is a clear signal to a younger leader that an elderly fan is not synchronized with the implicit career schedules of the organization Such a perception of "being backward" will cause older adherents to react negatively and reduce the perceptions of their own younger leader (35) 31 For other young and lack of experience newcomer, they have to the Subcontracts time over time and does not have chance to execute the Main Contractor at all, for e.g Ms Quyen has to 420 subcontracts alone during the 2018 period, which completely limited her from approaching the knowledge about the Main Contract execution procedure, and furthermore, leading her to quit the company at the end of May 2019 Both the deputy manager and the director still struggle to find solutions which can balance people in the department which encourage them to interact together, leading to share of knowledge, information and experience Such solutions in the past is initiated by assigning mixed between them, but the assignees from the date of assignment, continue what they have to before, doing it all alone without any reference of much of interaction with people who has done something similarly or such type of contracts before, that leads to the unfavorable clauses it may had during the contract negotiation stage On the other hands, due to long time working with suppliers or subcontractors, Ms Quyen may find it difficulty when working with such suppliers or subcontractors again if Ms Van Anh or Ms.Tran gives a consent to any clauses or conditions in the Subcontract which Ms Quyen has contrary idea against Based on the summarized information from the interviews and the above validations, lack of work-interaction within the department can be identified as the main causes of cooperative problem among employees in the department Therefore, the solutions that the writer is about to propose to solve this only main cause is shown or the part below In short, according to all previous analysis, the final cause-effect map will be shown as below 32 Diagram 3: Final cause-effect map of Contract Department in HBC 33 Alternative solutions Based on some intensive literature review and interview with the members of the Departments, here are some suggested solutions that may have been analyzed to find the real solution These two solutions are made only to solve the lack of the work interaction cause, not taking into account of both poor communication and work-overload problem Solution – Provide orientation and internal knowledge sharing class This idea is to provide a careful and adequate orientation program for both new and experienced members the Department Tải FULL (78 trang): https://bit.ly/3ph4uo5 Dự phòng: fb.com/TaiHo123doc.net For newcomers, they have to get used to the Subcontract first, there shall be specimen for different types of contract including labor and material supply contract, design contract, construction contract and so on There shall be a data base file that encompasses available information about every kind and character and name of each Subcontractor, which commercial clauses have been successfully negotiated against such Subcontractor and which ones the company has to put up with This file shall be available to all of the member within the department to enter and contribute, also to gather information during their draft and negotiate the Subcontract The benefit of this action not only to give the newbie the overall picture of what they are going to or execute during their probation time, but also to ensure the experience and current executives have the accurate reference on what they are doing Newcomers become productive earlier if they comprehend their work strongly based on fundamental understanding (36) Main Contract and Subcontract are different types of Contract, but it has a lot of things in common First, Subcontract derives from Main Contract, without Main Contract, the Subcontract is not needed Secondly, all of the commercial clauses are stipulated in the Main Contract shall be applied on a back-to-back basis to all the commercial clauses in the Subcontract, save for some Contract that has small value or could not be applied due to some specific reason, especially that the Subcontractors always feel unfair when applied such on The orientation is intended to have all of the people in the Contract Department 34 could directly and straightforwardly enter, gather and refer to information to the Main Contract which they need, instead of now, the people who the Subcontract has to find it on numerous paper version to find the Main Contract, or need to ask for the scanned version of people working in the Site who taking charge of such project to get the Main Contract scanning file It is ridiculously that people in the Contract Department could not find the Main Contract themselves Questions were raised but the answers were the same all the time, due to its confidential It‟s confidential, for sure, but there are ways to avoid the expose of confidential information, such as scanning the whole version of the Main Contract except the price pages or always make available of all terms and conditions of the Main Contract for people who is taking charge of such Subcontract The first and second quarter of 2019 saw Ms Hoan has organized 03 of the internal knowledge sharing classes, with the class usually occurs in the Saturday with the following contents: Tải FULL (78 trang): https://bit.ly/3ph4uo5 Dự phòng: fb.com/TaiHo123doc.net Changes in FIDIC Redbook 1999, 2017 Introduce and discuss about FIDIC Yellow Book 1999 (D&B Contract) Introduce and discuss about Insurance in Construction Contract Such class has been spontaneously organized by Ms Hoan, and almost everyone replied that such class has given them superior knowledge For newcomers, this maybe too much, but it could be note as they would have worked in the later stage of their career, for the current ones, this could be a chance to reinforce their knowledge and experience and also spend time for some queries, debates and discussions among the participants Such internal classes shall be developed and organized by other veterans in the departments such as Mr Tan, Ms Van Anh, Ms Tran, about those related topics that has been always subject to raise: Changes in FIDIC Yellow Book 2017 Introduce and discuss about Bank Guarantee in Construction Contract Introduce and discuss about Bill of Quantity in Construction Contract Introduce and discuss about Variations in Construction Contract 35 Introduce and discuss about Payment/Retention in Construction Contract Introduce and discuss about Damages/Indemntity/Liablitiy in Construction Contract Such as shall be organized in a periodical time within a month, and such instructors shall be available to receive some rewards or bonus within such a month Rewards is every important and can be described as “an award given to an employee on their achievement and contribution towards their companies” (37) According to Korir et al (38), Organizations have a poor or non-reward management structure leading to lower organizational performance, discourage the obligations, motivations and innovations of staffs to work with others to fulfill their common goals In particular, a fair distribution system signals for o staff that the management emphasizes on staff assessment (39) Through reward system, employees‟ motivation is improved, urges members to work and decrease the labor turnover rate Consequently, it could be said that if employees are well-treated and make the most of their present work, the results would be better Then again, if the firm does not have any plans to implement reward for such contributed employees, who is willing to share their time and experience toward the youngsters, it will result in the failure of inspiring employees and retaining talented staffs, causing lack of cooperation among remaining employees Accordingly, some benefits and costs of this solution could be described as below: • Benefits: + To improve the performance of new and current employees + To enhance communication between the members of the departments + Be able to recognize and reward the talented people + To ensure the consistent all of types of Contract from the Main Contract to the Subcontract, therefore avoid unfavorable Contract Clause which has adverse effect on the Company + To enhance the ability to retain stellar employees + To the data-base for the Department for reference 36 6680353 ... the organization, the lack of information can create a cascading effect that will damage the organization Lack of coordination creates gaps in the acquisition and distribution of information This...UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business Tran Minh Tam LACK OF COORDINATION AT HBC’S CONTRACT DEPARTMENT MASTER OF BUSINESS (HONOURS) SUPERVISOR: Professor... the organization can work to prevent delays and resulting coordination problems Another sign of a lack of coordination within an organization is redundancy With redundancy, an organization will