PROJECT MANAGEMENT AT UJELI NEPAL

A business case in project management

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Ujeli Nepal pvt Ltd was established in 2006 as producer of alternate energy. The company is a
manufacturer of Solar water heater panels and also working on solar electricity panels. The
founder of the company was Mr Nirodh Pandey an electrical engineer from UK .After nearly
nine years of work experience in UK in an alternate energy consulting firm he finally decided to
reside in Nepal and contribute to the utilization of solar energy .

After nearly twelve years of operation he has a management team as follows(in 2018):

Mr Nirodh Pandey , (B.Engg UK) Managing Director

Mr Toran Sharma, MBA Germany CEO

Ms Basu Pandey MBA TU Finance manager

Ms Ritu Goenka, BE MBA(KU) Marketing Manager

Mr Raman Sigdel R & D /Production Manager

The company was established at a time when there was acute power crisis in Nepal. The crisis
has no sign of getting controlled within few years. Mr Pandey the MD strongly feels that it is a
growing market.The growth is due to the rise in housing and the pending power crisis

The company has two product line :solar water heaters and solar DC panels for lighting purpose.

The company has not yet been able to successfully produce and sell the solar panels in Nepal, but
the solar water heaters have picked up.They have made few samples of solar panel but the sales
have not picked up because of multiple technical complains. They are trying to rectify it. But
they are selling imported solar panels from China.Their main source of revenue is solar water
heaters. They use the local materials as much as possible along with the vaccuum tubes ,that are
imported from china They also manufacture the solar driers on order basis from agro processors.

Their corporate strategy is growth by expansion in domestic market and their business strategy is
to remain the low cost producer.

Mr Nirodh Pandey does not believe that gas heaters are the competitors to the solar panel. The
gas geysers are unsafe, difficult to carry, and getting costlier, but solar heaters are very safe and
suitable for family.

The company has achieved an yearly revenue of Rs 3 crore in year 2008 and 3.5 crore in
2009.The company has set the goal of achieving a sales of Nrs 12 crore by 2020.It was a modest
growth target of 10% % per year ,but in 2018 they achieved the sales of only 8 crore rupees and
in 2019 they expect sales of rs 8.2 crores – which was not the satisfactory achievement.

Mr. Nirodh Pandey says “the company wants to maintain the quality, so we cannot set the
aggressive targets, once we develop the right solar panels and right solar heaters our sales will
grow at a faster rate”

The overall solar energy sector is an industry with a slow growth rate, although there is demand
in the market. The slow growth is mainly due to the high cost of the products. Mr Nirodh wants
to establish the company as a low cost producer, so he wants more R&D projects to be running.

The company has two production centers one at Bhairahawa and another at Bhaktapur.The
company has workforce of thirty skilled employees including the senior management team.

Mr Toran , CEO , a graduate from a German University has joined the company in 2007.He
initiated the project based management system in 2007.The employees were involved in several
project activities . He applied project management techniques that he had learned while
implementing the projects

The company is also going to announce some projects for year 2020 as attached in aggregate
project plan.(see attached table at the end of case)

One project is still running now and the team ( comprising of three people)is still working hard
at Bhairahawa to finalize the design of the low cost solar electricity panel.The project has been
extended by three months and the output is still being awaited.The project team has some
dissatisfaction that there is lack of technical support from the head office. As per their practice,
few employees from every department are engaged in some project activities .The project
manager is usually given adequate authority to run the project.

The projects are created, but lacks support and coordination. The overindulgence of employees
in the project activities seem to have hampered their departmental functions ..There is complain
from customers about the customer service. There is complain from the suppliers about delayed
payment.

The organization has not been not free from conflict. At the end of the year 2017 and 2018 the
employees demanded the bonus out of the profit, but the bonus was not distributed.The
employees claim that there was a net profit(after deducting all expense and tax) of Nrs25 lakh
in 2017 and 30 lakh in 2018 .Similarly a net profit of not less than 30 lakh is estimated in 2019,
however the audited figures have not yet come out.Management has given the argument that the
profit has been transferred to reserve for project expenses in coming years.

The employees now seem to be more organized than before The issue of bonus first or the
project first has not been resolved. They have already submitted demand letter for bonus.
Management wonders if the bonus is distributed there will be no budget for projects !
The employees did not seem to be very positive about the project based management system.

One of the supervisor level employee commented “the projects are for the senior employees and
few other selected employees. They earn good income by taking project allowances but what the
projects have delivered to the organization…!Last year also they said they spent Nrs 950,000 in
projects and one project is still running – but what is the benefit to the organization ?Where is
performance evaluation of projects? This company has not been able to sell the reliable solar
panels yet ! Yes it has produced the solar water heater panels which is slightly cheaper in the
market but the technology is not very different!” Many problems have not yet been resolved.

Multiple projects have been completed since 2007, but those who have worked in project do not
know what has been the impact of the project they have completed to the organization.

One of the employees even doubted under clause of anonymity that the findings of the research
projects in the past have been sold to the German firms rather than being used in the
organization!

It seems there is conflict between management and employees. There is conflict among
employees working in project and not working in project. There is rising expectation from
customers that Ujeli will produce some thing cheap and reliable for the local market. CEO Mr
Nirodh Pandey untiringly and repeatedly speaks in front of the media that Ujeli will bring out
the cheapest and best solar panels and heaters, but neither the customers are happy nor
employees. Some where CEO is creating over expectations.

But despite all the conflicts the employees have good friendly relations among themselves. They
celebrate many activities together.

The management team is not unaware of the problems.They have called an interactive session on
4 th Dec 2019 to propose the projects for the coming year(2020) and get the feed back from
employees.They have invited all the employees, and few members from the community forum
located in Bhairahawa..

Questions to be discussed in the case analysis :

Q1. Evaluate the project management approach and the management process adopted by the
company based on your personal evaluation
Q2. Critically evaluate the Project Plan and the ranking made by the management for next year
(see Attachment of proposed 2020)
Q3.How to handle the bonus issue ?Do you support the demand of the employees?
Q4.Suppose you incharge of any one of the projects in Ujeli, what type of problems will you
face during implementation?
Q5. Give some specific suggestions to management.
 AGGREGATE PROJECT PLAN OF UJELI(proposed 2020)

Type of Business: Manufacturing , selling of solar heaters and solar panels

Business Strategies:
Incresae sales with focus on Urban as well as semi urban areas of Nepal
Continuous research on use of local materials
Increase in price to be kept nominal unless very pressed
Current turnover: Around 9 crore rs annual

Ranking in
Name of Type of manpower
SN Start End Project Goal Total Cost terms of
Project involved
Importance

Identification of a new product

Marketing(1),R&D(2),
1 Project NPD 9-Feb 20-May concept for remote area in solar
Finance(1),Expert(1)
heating Rs 150000 High
Marketing(1),R&D(1),
Change of Design of existing Solar
2 Project CD 1-Mar 30-Apr Production(1),Expert(
heater SH-3 to rectify defects
Rs 95000 High 1)
CEO, Marketing
Project Explore export market by Rs (1),R&D(1),Assistant(
3 15-Jun 30-Jun
Trade fair participating in trade fair in Germany 15,00,000 High 1)
Feasibility study for large solar panel Nrs
4 Project FS 20-Jun 20-Oct to be used in rural community water Marketing(1),
500000
distribition by pulling water from well Medium R&D(2),Production (1)

Current Manpower Strength

Marketing Manager -1
Asst Marketing Manager -2
Production Manager -1
Asst Production Manager -2
Finance manager -1
Assistant Finance - 2
R & D -2