Hindustan Construction Company (HCC) : Catalyst for Leadership

With the construction sector seeing a revival in recent years owing to

investments, HCC realized that they needed to upgrade their project controlling

systems for visibility into the current projects.

With rapid growth came the challenge of managing it. The information

management was unorganized making access to information and informed

decision-making a herculean task. The margins too were increasingly thinning due

to increasing price of raw materials and increasing price cuts from competition.

A new business model was the need of the hour that would help in diversifying

and improving profitability and growth rate.

Challenges Ahead



Says Satish Pendse, CIO, HCC, "Being an eighty-year-old company, existing

processes were not always in line with modern management practices, and we

realized the need for a change management exercise to effect the proposed

changes."

HCC wanted the implementation to be spread across its various locations,

including remote locations in Kashmir. However, the company was clear on what

they expected from their IT systemit had to support operations across remote

locations and fulfill the demands of a growing business.

The solution was to help HCC gain competitive advantage by adopting the best

practices. HCC needed a solution that will help it closely monitor projects and

help in faster and sharper decision-making. Equipment and tools management was

one parameter HCC seriously evaluated while choosing the solution.

Rolling Out



After zeroing in on the broad objectives of the system, HCC began the

process of selecting the right solution from a global brand that could fit well

with the requirements of the infrastructure industry.

Considering that SAP had a solution that could help in equipment and tools

management, HCC opted for it. Further, SAP ERP had powerful tools available for

efficient costing and execution of projects. The solution was localized for

India, enabling HCC to meet the statutory norms defined by the government. Even

the payroll system was customized for India. The scope of implementation covered

a wide range of business functions.

For rolling out the implementation, IBM was chosen. Apart from ERP, SAP was

also chosen for engineering construction and operations. The initiative, called

Sankalp, had management support and despite the logistical complexity of the

project, the implementation was completed ahead of schedule, ie in seven months.

This was an incredible achievement, given the magnitude and complexity of the

task. "Project sites like those in Jammu & Kashmir are testing grounds for the

companys IT initiative. Moving large equipment typical of the construction

industry to such inaccessible areas can be daunting. The SAP implementation

helped our project managers to anticipate such situations more easily and source

their requirements well in advance," says Pendse.

While the business processes in finance and HR have been streamlined, on the

other hand, project management at sites has increased. Post the implementation

of SAP ERP, HCC today has better control on equipments and tools at project

sites, thereby, increasing capacity utilization and cost optimization.

Cost implications across the sites have become clearer improving control over

projects as information is seamlessly available for decision. There is improved

transparency of available stock as demand can now be better forecast by

analyzing usage trends with the solution.

Stuti Das



stutid@cybermedia.co.in