OPERATION MANAGEMENT REPORT
Posted: January 5th, 2023
OPERATION MANAGEMENT REPORT
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Executive Summary
Sohar International Bank (SOAG) is an Omani bank that is repositioning itself to be a world-leader in banking services. To this end, the banking firm wants to build a new headquarters in Muscat, Oman that will consolidate the management activities undertaken in three other head offices. It is expected that the new building will change the skyline of the capital city and demonstrate the latest in building technology that encompasses the application of the 4D planning framework comprising lean construction principles, building information modeling (BIM), and computer aided design technology to deliver an environmentally-friendly and aesthetically-pleasing iconic building suitable for a company with global operations. This operational management report discuses the project context and objectives, project team, project stages and project plan, which are supported by a project schedule, a work breakdown structure, an activity list, a network diagram, a budget, and a risk register.
Table of Contents
Contents Page
Section A: Project Context and Objectives. 5
Appendix A: Project Timeline. 13
Appendix D: Network Diagram and CPA.. 14
Appendix F: Risk Log/Risk Register 15
Operation Management Report
Introduction
Sohar International Bank (SOAG) is an Omani banking institution that was founded in 2007 and offers banking services to corporate and retail clients in the country and the Middle East region. The organization has experienced steady growth since its inception under the leadership of Mohammed Ardhi as the chairperson and Ahmed Musalmi as its chief executive officer (CEO). As of 2019, the firm generated $271.28 million in revenue and $89.48 million in profit using its 883 employees (Sohar International 2020). In 2018, the new management of the firm launched a five-year strategic plan aimed at repositioning the bank as a world-leading service company, which will be propelled by five pillars; experience, personality, principles, promise, and purpose (Sohar International 2019). It also launched a new corporate logo of two semicircles to signify perpetuity, dynamism, and elegance. Part of its strategic plan is to increase the velocity and value of its services using digital technology that integrated telecommunications with banking services to enhance the quality of services to its customers (Albawaba 2019).
The proposed project seeks to advance Sohar International Bank strategic plan improving operational processes while leveraging the latest architectural technology to deliver an energy-efficient and environmentally-friendly building that will serve as the headquarter of its global operations. This global head office will combine the three head offices that the company uses in it expanded banking services. This operational management report is structured in four sections; the first outlines the project context and objective, the second describes the project team, the third explains the project stages, and the fourth discusses the project plan.
Section A: Project Context and Objectives
Large buildings place a large financial burden to the firms that own them because of the costs of running and maintaining them. In the Middle East region, buildings are heavy consumers of electricity because of the air-conditioning required to make them comfortable to the people inside them despite the high temperatures outside (Schaufelberger & Holm 2017). They are also an environmental burden because the electricity they require is generated using generators that consume petroleum fuels, which pollute the atmospheres by emitting greenhouse gasses. Therefore, the demand for smart buildings that have fuel economy and are environmentally-friendly is increasing in the contemporary business environment where social responsibility has become premium to firms to be guaranteed a social license to operate (Heravi, Coffey, & Trigunarsyah 2015). The public and governments are persuading corporate entities to be more environmentally and socially-responsible in their daily operations. It is upon this backdrop that this project is proposed.
The proposed project is the building of a new headquarters for Sohar International Bank from where the firm will run its global operations. The proposed new smart building will consolidate the three head offices into one and employ the latest digital technologies to not only enhance service delivery to customers but also save energy and enhance its environmental friendliness. The building will have a shape that captures the wind to use it as part of the ventilation system to cool the interior air. It will also be made of materials that make it has a lower carbon footprint by allowing light to get in while facilitating the reduction of the carbon content in the atmosphere inside the building produced by the exhalation of people therein (Ogunde et al. 2015). In this regard, the building will have a façade of translucent glass to capitalize on natural light and areas with green plants to absorb carbon dioxide and release oxygen (Mhuireach, et al. 2020). Moreover, the building will be fitted with artificial intelligence, robotics, and telecommunications technologies to deliver an environment supporting the internet-of-things connectivity, including the automated conduct of building maintenance such as cleaning, remote monitoring of the temperature of the building and adjusting the heating, ventilation, and air-conditioning (HVAC) system accordingly to maintain a comfortable working ambience (Basnayake et al. 2015).
Section B: Project Team
This project will be executed by a team lead by the project manager. The project team in this case, will consist of the client, architect, engineers, consultant, main contractor, and subcontractors, thus representing the major stakeholders of the new headquarters building (Heravi, Coffey, & Trigunarsyah 2015). Sohar International Bank is the client in the proposed project who will prescribe the functional and aesthetic needs that need to be achieved and avails the fund for the execution of the entire contraction, thus commissioning the project. The consultant is a specialist professional that defines which standards should be achieved by the project including its sustainability, safety against fire, earthquakes, monsoons, noise and air pollution, which influence the performance of a modern building. The architect will prepare the design of the building according to the proposals of the client and will strive to ensure that the building regulations in the industry and country are achieved using the advice from the specialist consultant (Schaufelberger & Holm 2017). The engineer will prepare the civil, electrical, and mechanical design aspects of the building, which will be superimposed on the architectural design. The designs presented must adhere to the industry and national standards that ensure that the structure functions and performs as expected. The main contractor will oversee the implementation of the project by executing the architectural and engineering plans alongside incorporating the advice from the specialist construction consultant (Schaufelberger & Holm 2017). The contractor will also enlist subcontractors to perform specific tasks in the project, like laying out the electrical, HVAC, and plumbing systems, and the civil works including landscaping. The main contractor will ensure that the subcontractors adhere to the work breakdown structure (WBS) prepared by the project manager in consultation with the project team (Heravi, Coffey, & Trigunarsyah 2015).
Section C: Project Stages
This project is more of a modernization project that seeks to facilitate the delivery of banking services from an operational management perspective. The proposed new building is expected to improve the operations of Sohar International Bank at the management level by offering an office space that brings the entire senior management under one roof while ensuring that the running and maintenance of the building is efficient and cost-effective. In this regard, the project will proceed through four stages of activities, as outlined in the 4D project framework (Fadeyi 2017). The four stages outlined in this change project methodology include, definition, designing, development, and delivery.
Definition
During this stage, the short and long-term business objectives of Sohar International Bank, as the project sponsor, are identified and tied to the outcomes of the head-office construction project. This stage will benefit from the information generated by the initiation and discovery processes, which will have identified the organizational needs that need to be met and the organizational problem that needs to be resolved by the construction project (Walker 2015). In this regard, Sohar International Bank intends to improve the efficiency of management operations of its global banking activities to help position it as a world-leading banking service company, which is one of the outcomes of its new five-year strategic plan. The project scope will be defined in this stage as part of the project planning process. Also, the project team will be constituted and a project plan will be mooted to ensure that the construction project is aligned to the requirements of the project sponsor (Schaufelberger & Holm 2017).
Design
During this phase, the project will be designed to ensure that it meets its intended outcomes within the time and resource budgets that have been present at the definition phase. The design process involves the application of the confident estimates in financial cost, time, and quality of the deliverable at each construction project milestone (Walker 2015). First, a communication system will be established to ensure that all stakeholders and the project team share information and are kept updated on the project progress. The communication system will facilitate the seamless attainment of the milestones within the proposed timeframe, without scope creep and budget and time overruns (Schaufelberger & Holm 2017). Secondly, the architecture of the proposed solution, which details the functional specifications and quality criteria for the construction project, will be designed. Besides, the project documentation system will designed at this stage (Schaufelberger & Holm 2017). The documents needed to the successful implementation of the construction project include the project charter, project, quality, and commitment plans, the project brief and timeline updates, and the governance documents, including the service level contracts with the contractor and subcontractors, risk register, issue log, change requests and site meeting minutes (Walker 2015). The design is in such a way that the building will contain three major offices and at least twenty other auxiliary offices that perform different duties aimed at achieving the same objective. The building will be U-shaped to achieve better flexibility for line-balancing (Walker 2015). The headquarters will be a two floors building to accommodate all the offices, and will adopt the features of western culture in its construction.
Development
In this phase, the project team identifies all the construction activities and develops a work breakdown structure that places these activities sequentially within the prescribed timeframes, while assigning responsibilities to the members of the project team (Walker 2015). The activities are listed in Appendix C, while the work breakdown structure and the project schedule are provided in Appendices B and A, respectively.
Delivery
During this phase, the actual construction of the head office building will be undertaken according to the schedule provided in the project schedule and work breakdown structure (Walker 2015). Moreover, the budget outlined in Appendix E will be expended and finances disbursed to the project team, and especially the main contractor to ensure that construction continues on course without interruptions.
Section D: Project Plan Discussion
Project planning is a rigorous undertaking that involves the entire project team and the key stakeholders. The planning process commences with the kickoff meeting at which the project stakeholders and project team meet and the project owner introduces the project following the signing of contracts, constitution of the project team, and identification and engagement of the project manager and main contractor (Ahmed, Hosni, & El Yamany 2018). Working relationships are established, a communication system is agreed upon, and the project schedule is launched and discussed in detail during the planning process. At this point, the 4D planning methods will be employed, which will leverage building information modeling (BIM), lean construction practices, and computer aided design technology that will help visualize all the project activities in a temporal sequence (Brioso 2015; Butkovic, Heesom, & and Oloke 2019; Sheikhkhoshkar et al. 2019). In addition, the planning process will include the development and discussion of the risk register in which project risks will be identified and prioritized based on their occurrence likelihood and impact on the entire project. This is to ensure that the construction project is completed successfully within the finance and time budget to avoid overruns, as detailed in Appendix F (Abd El-Karim, Mosa El Nawawy, & Abdel-Alim 2017).
Also, the planning process will also involve the development, familiarization with, and discussion about the project schedule, the activity list, and the work breakdown structure, as outlined in Appendices A, C, and B, respectively (Walker 2015). In the same vein, the project governance processes will be discussed during the planning stage to ensure that the highest quality standards of the project deliverables are achieved at the projected milestones and that the project is delivered within the scope outlined in the project charter (Derakhshan, Turner, & Mancini 2019).
Conclusion
The new headquarters project for Sohar International Bank is a huge building construction project undertaking that is complex, and therefore will require an estimated budget of $150 million. This building is intended to change the skyline of Muscat in Oman because it will be a landmark feature of the city and country. it will not only have a unique design that captures the culture of Oman and integrates it with the latest technology in building construction, operations, and maintenance, including artificial intelligence, internet-of-things, and digital technologies to ensure that it achieves the highest standards of energy efficiency, low carbon footprint, and overall environmental friendliness. Because it will leverage the latest advancements in green energies, including the optimized use of solar and wind power to replace the petroleum fuel-powered energy needs such as ventilation and lighting, the new headquarters is expected to propel the banking firm to a leadership position in the global banking sector, which is part of the firm’s five-year strategic plan. The project plan detailed in this report outlines the project management process that will ensure that the new building is delivered within 2 ½ years at a cost of $150 million.
Reference List
Abd El-Karim, MSBA, Mosa El Nawawy, OA & Abdel-Alim, AM 2017, ‘Identification and assessment of risk factors affecting construction projects,’ HBRC Journal, vol. 13, no. 2, pp.202-216.
Ahmed, EFED, Hosni, HE & El Yamany, A 2018, ‘Factors affecting construction planning,’ Journal of Al-Azhar University Engineering Sector, vol. 13, no.46, pp.14-19.
Albawaba 2019, ‘Sohar International celebrates 12 years of banking and beyond,’ Available from: < https://www.albawaba.com/business/pr/sohar-international-celebrates-12-years-banking-and-beyond-1278788>. [15 December 2020].
Basnayake, BADJCK, Amarasinghe, YWR, Attalage, RA, Udayanga, TDI & Jayasekara, AGBP 2015, ‘Artificial intelligence based smart building automation controller for energy efficiency improvements in existing buildings,’ International Journal of Advanced Automation Science and Technology, vol. 40, no. 40, pp. 150-156.
Brioso, X 2015, ‘Integrating ISO 21500 guidance on project management, lean construction and PMBOK,’ Procedia Engineering, vol. 123, pp.76-84.
Butkovic, B, Heesom, D & Oloke, D 2019, ‘The need for multi-LOD 4D simulations in construction projects,’ Journal of Information Technology in Construction, vol. 24, pp. 256-272.
Derakhshan, R, Turner, R & Mancini, M 2019, ‘Project governance and stakeholders: a literature review,’ International Journal of Project Management, vol. 37, no. 1, pp.98-116.
Fadeyi, MO 2017, ‘The role of building information modeling (BIM) in delivering the sustainable building value,’ International Journal of Sustainable Built Environment, vol. 6, no. 2, pp.711-722.
Heravi, A, Coffey, V & Trigunarsyah, B 2015, ‘Evaluating the level of stakeholder involvement during the project planning processes of building projects,’ International Journal of Project Management, vol. 33, no. 5, pp.985-997.
Mhuireach, GÁ, Brown, GZ, Kline, J, Manandhar, D, Moriyama, M, Northcutt, D, Rivera, I & Van Den Wymelenberg, K 2020, ‘Lessons learned from implementing night ventilation of mass in a next-generation smart building,’ Energy and Buildings, vol. 207, pp.109-547.
Ogunde, A, Olaolu, O, Afolabi, AO, Owolabi, J & Ojelabi, RA 2017, ‘Challenges confronting construction project management system for sustainable construction in developing countries: Professionals perspectives (a case study of Nigeria),’ Journal of Building Performance, vol. 8, no. 1, pp.1-11.
Schaufelberger, JE & Holm, 2017, Management of construction projects: a constructor’s perspective, Taylor & Francis, Routledge.
Sheikhkhoshkar, M, Rahimian, FP, Kaveh, MH, Hosseini, MR & Edwards, DJ 2019, ‘Automated planning of concrete joint layouts with 4D-BIM,’ Automation in Construction, vol. 107, pp.102-943.
Sohar International 2019, ‘With solid foundation and a clear vision, Sohar International celebrates 12 years of banking and beyond,’ Available from: <https://soharinternational.com/newsroom/2019/april/with-a-solid-foundation-and-a-clear-vision-sohar-international-celebrates-12-years-of-banking-and-beyond/>. [15 December 2020].
Sohar International 2020, ‘About us’, Available from: <https://soharinternational.com/about-us/>. [14 December 2020].
Walker, A 2015, Project management in construction, John Wiley & Sons, Hoboken.
Appendices
Appendix A: Project Timeline
| Activity | Time (weeks) | Year/Quarter | |||||||||
| 2021 | 2022 | 2023 | |||||||||
| 1 | 2 | 3 | 4 | 1 | 2 | 3 | 4 | 1 | 3 | ||
| Preconstruction | |||||||||||
| Commissioning project | 1 | ||||||||||
| Constituting project team | 2 | ||||||||||
| Project plan | 4 | ||||||||||
| Soil analysis | 12 | ||||||||||
| Architectural design | 16 | ||||||||||
| Construction | |||||||||||
| Excavation | 30 | ||||||||||
| Driving piles | 12 | ||||||||||
| Concrete works | 64 | ||||||||||
| Steel works | 48 | ||||||||||
| Electrical installations | 48 | ||||||||||
| Plumbing | 32 | ||||||||||
| Interior works | 48 | ||||||||||
| landscaping | 48 | ||||||||||
| Close-out | |||||||||||
| Hand over/ Sign off/ Commissioning | 1/3 | ||||||||||
| Scope analysis | 1/2 | ||||||||||
| Lesson learned documentation | 1 | ||||||||||
| Celebration | 1/7 |
Appendix B: WBS
Appendix C: Activity List
| No | Name | Dependency | Subcontractor |
| 1 | Subsurface analysis | 0 | Soil analyst |
| 2 | Excavation | 1 | Civil engineer |
| 3 | Drive piles | 2 | Civil engineer |
| 4 | Earthworks | 2 | Civil engineer |
| 5 | Concrete works | 3 | Mechanical engineer |
| 6 | Steel works | 3 | Mechanical engineer |
| 7 | Electrical | 4,5 | Electrical engineer |
| 8 | Plumbing | 4,5 | Plumber |
| 9 | Interior | 7,8 | Interior designer |
| 10 | Landscaping | 7,8 | Landscaper |
Appendix D: Network Diagram and CPA
Appendix E: Budget
The project is estimated to cost $150 million
| No | Item | Unit price ($) | Cost ($) |
| 1 | Hire consultant | 1.25% of budget | 1,875,000 |
| 2 | Hire architect | 2% of budget | 3,000,000 |
| 3 | Hire project manager | 2.25% of budget | 3,375,000 |
| 4 | Higher main contractor | 12% of budget | 18,000,000 |
| 5 | Subcontractors | ||
| 5a | Civil works | 29,425,000 | |
| 5b | Mechanical works | 25,450,000 | |
| 5c | Electrical works | 33,550,000 | |
| 5d | Interior (fixtures & furnishings) | 2.5% of budget | 3,750,000 |
| 5e | Landscaping works | 8,500,000 | |
| 5f | Smart technology (internet-of-things) | 10% of budget | 15,000,000 |
| 6 | Meetings | 2,000,000 | |
| 7 | Communication/documentation/internet | 1,950,000 | |
| 8 | Foreign currency fluctuations | 0.5% of budget | 750,000 |
| 9 | Legal fees | 1% of budget | 1,500,000 |
| 10 | Cost of opening and marketing event | 1% of budget | 1,500,000 |
| 11 | Contingencies (budget overrun) | 1% of budget | 1,500,000 |
| Total | 151,500,000 |
Appendix F: Risk Log/Risk Register
| Risk description | Likelihood | Impact | Total | Rank |
| Changing market conditions | Very High [5] | Very High [5] | 25 | 1 |
| Scope creep | Medium [3] | Low [2] | 6 | 5 |
| Budget overrun | Very High [5] | Medium [3] | 15 | 2 |
| Time overrun | High [4] | Medium [3] | 12 | 4 |
| Natural calamities (sandstorms, monsoon, earthquake) | Medium [3] | Very High [5] | 15 | 2 |
| Site accidents | Low [2] | Medium [3] | 6 | 5 |
Key:
Very high [5]
High [4]
Medium [3]
Low [2]
Very low [1]
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