Wednesday, September 29, 2010

Project Name: Hospital Shah Alam
Project Cost:RM482.6 Juta
Main Contractor:Sunshine Fleet Sdn Bhd >> (RM482million)
Sub Contractor: GM Healthcare Sdn BhdIsyoda (M) Sdn Bhd (451million)
Period: Start: 2007
-First Schedule:14 August 2010
-Second Rescheduled:14 November 2010
-Third Rescheduled:25-6-2011


Jabatan Kerja Raya (JKR) has terminated the services of Sunshine Fleet Sdn Bhd as main contractor in construction projects Shah Alam Hospital. Contract termination letter dated 3rd September was signed by the chief director of JKR, Datuk Seri Judin Abdul Karim.
JKR used clause 54 (condition of contract) to fired main contractor, Sunshine Fleet because failed to complete the project in accordance with the agreed period. Clause that is something normal in JKR, it gives the department the righ to terminate the contract if the work is out as scheduled.

Initially the projects run smoothly based on report by JKR, until June 15, 2010 progress on site. Projects run smoothly, and close to the original schedule of 25.3% compared to 25.4%, in where the delay was recorded only in three days. (Dewan Rakyat Parlimen Kedua Belas Penggal Ketiga Mesyuarat Kedua). However the problem was first detected when period of project complete has been extent for 233 days until 14 November 2011 with the reasons, factors beyond the control such as soaring price of construction material. Then followed by scale report dated on 2nd September 2010, the project must finish at least 33.1% but the projects only finish about 27%. From report on 15th June to 2nd September the actual progress is only 1.7% but the actual progress that contractor must achieve is about 7.7%. So the project delays about 6%.

Why all this happen, to know the answer we must back to the basic of Triple Constraint, cost, time and scope. At the first phase of problem when the contractor apply the extended time for completion jobs. As a result when we extent the time it will cause more cost on labor and will more face problem in market price for construction material because we are longer in this situation. More time we need to finish a project, is more risk for us to involve in situation where the market price for construction material is higher. Then to overcome the problem of soaring price of construction material, contractor can sealed an agreement to supplier or do an initial purchase.

As a conclusion, triple constraint (cost, time & scope) is very important to make sure the project runs successful. We can’t compromise at any one of this constraint because it will cause a failure in the project.


Prepared By: Mohd Iswan B Ismail
Prepared For: Subject Project Management.

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