Designing And Implementing It Strategy Information Technology Essay
The purpose of the report was to analyze and study the processes of the Godrej Industries and also understand the role of various factors which have impact on these processes and the overall integration between IT and the processes.
For the fulfillment of this objective we analyzed the Godrej Industries and encapsulated our findings under major themes like
Study of sub processes involved in the overall functioning and operation of Godrej industries..
Initially integrating those sub-processes in order to assimilate the overall major process.
Integrate the all the major processes mentioned above to design the overall integration process.
We also determined the integration factors that would be necessary for the overall integration and the applications and technology necessary to achieve the same.
Outline a brief road map for implementation of the IT Strategy.
Deriving the roles/responsibility matrix and Critical Success Factors to achieve the overall goal.
We were also able to highlight the communication protocol needed and the people enablement strategy that needs to be followed in order to implement the IT Strategy effectively
1. Construction Industry in India
The construction industry is the 2nd largest industry in India after agriculture. Construction being an integral part of a country’s infrastructure and industrial development there has been increasing investment in these sectors. The construction industry in India experienced a 12% year on year growth from 2000-2005 and is expected to grow by 25-30% during 2005-2010. The key drivers of the consistent growth are government investment in infrastructure and real estate demand in the industrial and residential sectors. It includes townships, offices, hospitals, schools, houses and other buildings, highways, roads, ports, railways, airports; power systems; irrigation and agriculture systems; telecommunications etc. Construction has become the basic input for socio-economic development covering such a wide spectrum. The construction industry generates employment for the people and through backward and forward linkages provides a growth impetus to other sectors. It is therefore essential to nurture this vital activity for the healthy growth of the economy. With emphasis on creating physical infrastructure, there is plan for massive investment during the Tenth Plan. The construction industry has to gear itself to meet the challenges and will play a crucial role in this regard. Considerable strengthening is required for the current capacity of the domestic construction industry in order to meet the intended investment targets in time. The construction sector has major linkages with the building material industry since construction material accounts for sizeable share of the construction costs These include cement, steel, bricks, tiles, sand, aggregates, fixtures, fittings, paints and chemicals, timber, mineral products, aluminium, glass, construction equipment, petro-products, and plastics. The construction sector is one of the largest employers in the country. In 1999-2000, it employed 17.62 million workers, 6 million greater than 1993-94. This sector also recorded the highest growth rate in generation of jobs in the last two decades, increasing its share twice in total employment.
1.1 Industry Definition
The construction industry is primarily engaged in the construction of buildings or engineering projects like highways and utility systems which includes new work, additions, modifications, or maintenance and repairs. The construction industry is divided into three major sectors.
Building Construction (both residential and non-residential).
Heavy and civil engineering construction such as land subdivision, utility systems, and highways, streets, and bridges.
Specialty trade establishments primarily engaged in activities to produce a specific component like masonry, painting, and electrical work of a project.
The construction industry sectors can also be classified in a different perspective with respect to the engagements:-
Transportation Infrastructure
Ports & Harbors and Special Projects
Roads, Airports & Runways
Bridges
Buildings & Factories
Institutional & Commercial Buildings
System and mass Housing & Industrial Structures for factories
Hydel & Nuclear Power and Foundation Engineering
Hydropower and Irrigation Projects
Nuclear Power, Space & Defense Projects
Electrical Instrumentation and Communication
Industrial Electrification & Switchyards
Telecommunication
Instrumentation
Industrial Projects & Utilities
Thermal & Non-conventional Power
Hydrocarbon Construction & Pipelines
Minerals & Metal
Bulk Material Handling
Water Supply and Effluent Treatment
Development Projects
Roads
Bridges
Airports
IT Parks
Water Supply Projects
Others
1.2 Trend Analysis
Public-private partnerships
Public-private partnerships are one of the significant modes of infrastructural financing. There have been several initiatives by Indian Government like viability gap funding, Public Private Partnership Appraisal Committee (PPPAC) and India Infrastructure Finance Company Ltd. (IIFCL) in order to promote public private partnerships. Viability Gap Funding is available up to 20% of the total project cost at the stage of project construction normally in the form of a capital grant.
Increasing Demand for Housing
Housing sector is going to witness unprecedented demands in future. With the improvement in economy, a large segment of the population would arise above the poverty line and the demand for construction would increase. The main determinants of the growth in demand for housing are demographic. However other factors like income, price of housing, consumer preferences, cost and availability of credit, price of substitutes, investor preferences, and price of compliments all play a role. The main demographic variables are population size and population growth, larger the population in the economy, the greater the demand for housing.
Widening Demand-Supply Gap
Though the demand for the housing and commercial buildings is very high but the supply side is limited as there is rapid increase in urban population. The various key drivers of this growth are causing the market demand to increase more and more. It has been observed that residential prices have increased by about 15- 20% on average in the last one year. There has also been a high growth in demand supported by rising low interest rates, disposable incomes, and fiscal incentives on both interest and principal payments and increasing urbanization. In 1995 the Estimated Monthly Instalments as a percentage of salary was around 54% as compared to 28 % in 2005. Also the average age of a house buyer has fallen from 42 to 31yrs as per industry estimates,.
India’s booming infrastructure spend
There has been a boom in India’s infrastructure spend as order inflows for construction companies continue to remain robust. Order book of top 8 construction companies was at least twice their annual revenues of 2006-07. There is a rising need for infrastructure sectors to invest in other parts of India apart from some of the metro cities and in areas such as roads, airports, power plants.
Industry Moving Towards Consolidation
Construction industry is gradually traversing to a stage where the major players are well defined. The players like L&T, Jaypee etc are undertaking major engineering and construction projects like Dams, Tunnels, Power plants, Heavy construction etc. This is creating huge demand for limited players. Since the prices of real estate in the urban India are very high companies need to have more capital so as to acquire new lands and develop them. The big players can survive this environment but will be few in numbers with well defined territories of operation. The demand in metro cities is perfectly inelastic, with well defined competition which is going to create huge boom for the operating companies.
100 % FDI in construction industry through automatic route
The Government has allowed 100% foreign direct investment (FDI) in the construction industry through the automatic route. The conditions restricting FDI to a minimum area of 100 acres and 2,000 dwelling units are now being relaxed to 25 acres and 50,000 square meters for construction development projects. This decision ensured that FDI was “construction-centric” rather than “land centric” which it was in the past. Foreign investors could now invest in any area but with the condition that they have to construct at least 50,000 square meters within a timeframe so that they did not hold land for speculative purpose.
Project Export
The Indian construction industry has been very active in the foreign markets, especially in the Gulf during the 1970s and 1980s when Indian companies ventured overseas to meet the demand of construction activities generated by the oil boom. Between 1975 and 1980, Indian companies have handled construction work with value of US $5 billion. There was a fall in this trend by 1980s but the future prospects seem bright.
1.3. Competition
There are around 200 firms in the Indian construction industry corporate sector. Apart from these firms there are about 120000 class-A contractors registered with various government construction bodies. In addition there are thousands of small contractors, which compete for small jobs or work as sub-contractors of prime or other contractors.
Companies like L & T, GMR Infrastructure, HCC, Gammon, Jaypee group, etc. which undertake huge projects.
Companies like IVRCL, Nagarjuna, DLF, Omaxe etc. dealing in flyovers, pipelines, apartments and housing/office spaces.
1.4. Godrej Group
When we talk about the respected business houses in India the Godrej Group would stand high in that list. The Godrej group has ventured into diverse business portfolios which range from engineering products to fast moving consumer goods. The various companies under the Godrej Group are involved in all sorts of business like locks and safes, typewriters, word processors, refrigerators, furniture, machine tools, process equipment, engineering workstations, cosmetics, detergents, edible oils, chemicals and agro products. The company is also famous for its initiation and philosophy of labor reforms.
GODREJ GROUP ESTD: 1897
COMPANY PROFILE: Founded 7th May, 1897, Lalbaug, Mumbai
Founder(s) : Ardeshir Godrej, Pirojsha
Headquarters : Mumbai, New Delhi, Chennai, and Kolkatta
Products: Chemicals & Commodities, ITES, Real Estate, Appliances and FMCG
Employees: 9,700
Website: www.godrej.com
Companies: 10
Sales Turnover: 1.1 billion US $
HISTORY
The company started in 1897 when the group founder Ardeshir Godrej gave up as a lawyer and started manufacturing locks. He was a consistent innovator and strong visionary who had great plans for future of the company. He along with his brother Pirojsha Godrej invented and manufactured new products which laid the foundation of the company. Now the company is one of most trusted brands in India and satisfies the needs of a 400 million customers. The company has also traversed overseas and diversified into a lot of sectors.
1.5 Godrej and Boyce Mfg. Co. Ltd
Godrej & Boyce Mfg. Co. Ltd is one of the holding companies of the Godrej Group which started its operations in 1897 with manufacturing of high quality locks. Since then the company has been growing consistently and now has 15 diverse business divisions which cater to all kinds of consumer needs across every nook and corner of India.
The Company has a network of 38 showrooms which are company owned and more than 2,200 wholesale Dealers, along with 18,000 Retail outlets across the country. The Company also has representative offices in Sharjah (UAE), Nairobi (Kenya), Colombo (Sri Lanka) and Riyadh (Saudi Arabia).
The various divisions are:
Appliances
AV Solutions (Prima)
Construction
Electricals & Electronics
Furniture (Interio)
Lawkim Motors
Locks
Material Handling
Precision Engineering
Precision Systems
Process Equipment
Security Solutions
Storage Solutions
Tooling
Vending (Prima)
2. DESIGNING IT STRATEGY FOR GODREJ CONSTRUCTIONS
2.1 Vision of Godrej and Boyce:
“Godrej in Every Home and Workplace”
2.2 Mission of Godrej and Boyce:
“Enriching Quality of Life Everyday Everywhere”
2.3 Corporate Objectives of Godrej and Boyce:
To delight its customers both in India and abroad.
Strive for excellence by nurturing, developing and empowering its employees and suppliers.
Encourage an open atmosphere, conducive to learning and team work.
To globalize the business rapidly.
2.4 Business Unit level Goals (Godrej Construction):
Improve customer satisfaction level by 30%.
Reduce costs by 25%.
2.5 Business Unit level Strategies of Godrej Construction:
Employ Cost Engineering approach
Enhance customer value proposition
Standardize and streamline supply chain and logistics processes
Standardize occupational safety procedures
2.6 Determining Tactical Unit (Godrej Construction) Level Strategies:
Goal: Cost Reduction by 25%
Approach: Balance Scorecard Approach
FINANCIAL [0.2]
Comprehensive cost analysis and control in procurement
0.50
0.10
Reduce cost overruns
0.30
0.06
Efficient working capital management
0.20
0.04
CUSTOMER [0.3]
Enhance customer value perception through Value Engineering
0.60
0.18
Focus on high quality and reliability
0.20
0.06
Deliver 95% on time completion
0.20
0.06
INTERNAL PROCESS [0.3]
Improve rate of bid wins
0.30
0.09
Standardize Risk Assessment and Method Statement
0.30
0.09
Expedite logistics process and administration
0.20
0.06
Develop integrated Construction Field Management
0.20
0.06
LEARNING & GROWTH [0.2]
Training in OHS Standards (OHSAS 18001) compliance
0.45
0.09
Training in Environmental Standard (ISO 9001/14001) compliance
0.35
0.07
Training of middle management in process standardization
0.20
0.04
Output of Balance Scorecard Approach:
Financial:
Comprehensive cost analysis and control in procurement
Customer:
Enhance customer value perception through Value Engineering
Internal:
Improve rate of bid wins
Standardize Risk Assessment and Method Statement
Learning & Growth:
Training in OHS Standards (OHSAS 18001) compliance
3. DEFINING PROCESS AND SUB PROCESS INTEGRATION
3.1 MACRO VIEW OF PROCESSES INVOLVED: AS – IS PROCESS
A.ENGINEERING PHASE:
This process involves Risk Identification, Quantification, and Assessment & Mitigation through analyzing the inputs, tools & techniques and outputs of each such process in detail and also involves understanding customer requirements & analyzing functional requirements in detail. It also requires you to evaluate different alternatives for project completion and detail document designs, preparation of reports/drawings and client interactions
Please Refer Appendix 1: For Process Flow in Excel Sheet
B.PURCHASING PHASE:
This process involves cost breakdown structure and estimation. TCO analysis & Cost estimation relationships are established. Discounting is done taking inflation into account. This process involves deciding on the criteria for selecting a supplier and the content to be scrutinized in the supplier proposal document. The process starts with a MRP and ends with supplier selection with proper approvals from management
Please Refer Appendix 1: For Process Flow in Excel Sheet
C.IMPLEMENTATION PHASE:
It involves material loading/unloading, inspection, ledger entries, inventory updation, quality checks and updating stock list. This process takes care of all logistics starting from information regarding destination, planning the method of transportation and aggregation, and final delivery to the destination. It also requires to have real time data of all inventory locations and hence to maintain a call center and an integrated channel system
Please Refer Appendix 1: For Process Flow in Excel Sheet
D.HEALTH AND SAFETY PLAN:
This basically represents a plan of implementing a set of safety procedures and also maintaining a log file for health and safety.
Please Refer Appendix 1: For Process Flow in Excel Sheet
3.2 HIERACHICAL/PHASE WISE PROCESS INTEGRATION: TO BE PROCESS
3.2.1 BIDDING PROCESS INTEGRATION
Now in the below bidding we have highlighted the logical flow of bidding process in which the initial knowledge about customers and competitors is required which when the RFQ is floated flows through a series of steps in order to final prepare a proper proposal document with the feasibility study.
Please Refer Appendix 1: For Process Flow in Excel Sheet
ENGINEERING PHASE:
3.2.2 RISK ANALYSIS PROCESS –
Please Refer Appendix 1: For Process Flow in Excel Sheet
3.2.3 VE – CI and Fabrication Design Phase Integration:
The project based approach is very essential for a value engineering process. After identifying the customer requirements we go for functional analysis and it is basically carried out for different department’s processes and construction systems within the organization. In the design area many alternatives are arrived at through brain storming process and idea generation with the involvement of all the other departments. The various alternatives are then compared pair wise with mapping to different processes and machinery equipments. such as whether any formworks, gantries, cranes and other plants suiting for the proposed construction is readily available and if not how the permanent structure design shall be changed to suit the available resources. After having brainstormed the various alternatives keeping the cost-reduction in view, a proposal is conceptualized.
Please Refer Appendix 1: For Process Flow in Excel Sheet
PURCHASING PHASE:
3.2.4 Cost Analysis and Cost Control Sub Process Integration:
Please Refer Appendix 1: For Process Flow in Excel Sheet
3.2.5 Subcontractors and Supplier Selection Process Integration:
Now the basic requirement of any supplier selection process can be given by the following diagram:
Please Refer Appendix 1: For Process Flow in Excel Sheet
The basic integrated sub process flow for the supplier selection is given below: The supplier selection basically starts from the need analysis or MRP generation to purchase requisition creation from where based on the amount of order or requisition that is placed the approval level is decided. Now then it is basically checked whether there is a contract that already exists .If it does then the order is placed to the supplier or else a RFO is floated .Then again the corresponding set of supplier is evaluated and final contract sealed.
Please Refer Appendix 1: For Process Flow in Excel Sheet
IMPLEMENTATION PHASE:
3.2.6 Integration of Method Statements/Interface Liasoning and Construction Field Management Process:
This statement basically should carry the name of the primary contractor and the work that is supposed to be done by him. It should also include the list of procedures like the sequence of works, the methods followed and the commencement date. We would also need to track the personnel and the equipments that are used. Apart from that it should also include the details about onsite risk analysis and the control measures, security that needs to be implemented.
Now the brief about the process if given below in the following process chart:
Please Refer Appendix 1: For Process Flow in Excel Sheet
3.2.7 Integration of Material Handling Process in the Implementation Phase:
Please Refer Appendix 1: For Process Flow in Excel Sheet
Now in this integrated process flow we find that it involves handling of material from the receipt from the suppliers till the delivery to the construction site and back to the store house if it’s needed. Basically on the receipt of the materials it is checked against a standard set of protocols like verification of all the documents and checking the quality and quantity of material received. Also it involves subcontractor material handling from their site to our final site.
3.2.8 Logistics Administration Process:
Please Refer Appendix 1: For Process Flow in Excel Sheet
It is the integration of all the logistics related activity that would be carried out in any construction industry. It involves main players such as the logistics call center which receives the demand or requirement log from the main construction site. It passes on the information regarding the details to the logistics management section which again coordinates with the Logistic control section in order to stock or deliver the requirements either in the central warehouse or in the local ware house which finally delivers it to the construction site or the destination.
3.3 INTEGRATION OF ALL MAJOR PROCESSES:
Please Refer Appendix 1: For Process Flow in Excel Sheet
The above figure basically represents the overall integration process. Here as we see that each process is complimenting each other and also a feedback mechanism has been integrated in order to ensure smooth functioning off all the processes. All the details of the bid acts as an input to the risk analysis process which also takes into consideration the environment and stakeholder tolerances. Then as we see all the processes will be integrated in a step wise and phase manner. The input of detailed design and fabrications will act as an input to the cost and control phase where corresponding strategies would be derived in order to select the suppliers and also it can be applied in the material handling phase. On the implementation front the various suppliers and contractors would be connected to the implementers in the field and there would be free and uninhibited flow of information from the Logistics management to the material handling in order to ensure smooth ordering and transportation. This will ensure smooth from of information and raw materials among different parties involved in this integrated framework.
3.4 PROCESS-APPLICATION-TECHNOLOGY MAP
Process(es)
Application Types
Tool(s)/Vendor(s)/Technology
Risk Analysis
Risk Analysis Construction Software
@Risk, Precision Tree, Top Rank, Evolver, Neural Tools, Stat Tools by Palisade
Primavera Risk Anallysis by Oracle
Fabrication Drawings
Engineering/CAD Construction Software
Building Information Modeling Construction Software
Autocad Architecture, Autocad Civil 3D, Autocad Electrical, Autocad Structural Detailing, Revit Architecture, Revit MEP,
Revit Structure BIM by Autodesk
Cost Analysis & Control
Cost Estimating Construction Software
Job Cost Accounting Construction Software
On Screen Takeoff Construction Software
Jonas Software
Spectrum by Dexter Chaney
Simple Accounting, Peachtree by Sage
The Professional Series by Contractors Software Group
Contract Management
& Administration
Contract Management Software
Primavera Contract Management
by Oracle
Document Management
Document Management System
Construction Document Manager,
Chameleon by Construction Imaging
Procurement,
Logistics & Material Management
Supply Chain Management Software
Manhattan Associates
Red Prairie
Project Scheduling
& Field Management
Scheduling and Resourcing Construction Software
Project Management Construction Software
Field Management Construction Software
Primavera P6 by Oracle
CMiC Project Management by CMiC
Timberline Office, MasterBuilder by Sage
BuilderMT
BuildIT Construction Scheduling by BuildIT
Safety
Safety Construction Software
Construction Safety Supervisor by Construction Safety Software Corp.
Safety Manager by SafetyInfo
Safetysoft
3. 5 FACTORS THAT AFFECT INTEGRATION:
Mostly within organizations IT implementation decisions are made within departments. They choose the technologies and solutions based on their own needs and requirements. There is usually a co-ordination problem when it comes to information and data sharing amongst departments especially if the individual tools and solutions are developed in-house. The applications are developed in different languages, run on different hardware and have different data structures, types and formats. This is what affects the integration of a large number of such stand alone applications in a large organization where there has to be data interchange between many departments for effective & efficient planning and seamless execution of projects.
Some of the factors which affect the integration process can be
Technology Platforms
In a typical construction business, we usually have certain number of projects which are under construction & others who have been handed over but under maintenance contracts. Hence, the different applications which are used in the company (if no ERP is there) work in different technology platforms and integrating them is a challenge. Middleware technologies and EAI can be some of the solutions.
Size of the Company
This is important to consider because as the company and its projects/customers grow managing customer relations becomes difficult. Hence, such a company needs to implement CRM solutions. It is important to consider the interdependencies of a CRM solution with existing applications before embarking on it. For example, a big products company may automate its contact center using different technologies but there is always a dependency between a vendor’s hardware and the software which may not work with existing CRM infrastructure of the company.
Type of data requirements
It is often difficult if some applications need real time data for taking decisions from other applications which are incapable of providing it in time. It is necessary to identify such applications and their organization wide dependencies before choosing which applications to implement. Also, the format of communication between applications is important as it puts more workload if the data an application needs is not provided in the same format. In such a case more tools need to be implemented to change/interchange the data formats which have their own dependencies. This calls for implementing EAI tools in some cases for better integration.
Approval Checkpoints
In an organization it is important to secure your data and hence before anything is implemented it has to be approved at various levels and departments. Construction department plans need to be approved by Finance and Marketing & Sales should know about it. Hence, all these data should have a common platform where it can be shared.
Costs and Benefits
Some applications if implemented would be able to deal with many kinds of integration problems but doing so and maintaining it could be a very costly affair. Hence, this analysis is required to be done before taking any decisions and trade-offs should be carefully evaluated with the existing and forgone benefits for zeroing in on a proper fit.
Data entry points
Number of manual data entry points and automated systems plays an integral part. This is mainly in inventory and logistics management because it affects the timelines of the project. Integration is important between vendors/suppliers IT systems and the warehouses of the construction company so that there is faster information flow regarding inventory movements. This has an impact on costs too and hence the systems should be compatible with those run by the finance department for easy clearances of credits and invoices.
External Pressures
The organization is under constant pressure from different stakeholders like customers, vendors, suppliers, shareholders, government for constant integration and flow of information in real time. Milestones achieved in projects should be communicated to all these stakeholders and hence the systems of the organization should be in sync with those of the stakeholders for real time updates of key goals achieved and real time progress parameters of the projects. E.g. could be call centers, monitoring dashboards etc.
4. IT STRATEGY IMPLEMENTATION:
4.1 Stakeholders Objectives:
Please Refer Appendix 1: For Process Flow in Excel Sheet
4.2 ROAD MAP FOR IMPLEMENTATION – ROLES AND RESPONSIBILITY -REWARDS AND RECOGNITION
We have in this integration tried to focus on a standardized based architecture that would fulfill the current basic requirements but simultaneously provide us with a base so that if we want to implements solutions in the near future we would be able to do that.
Reasons why Integration is very important:
Lack of integration of technology would result in low return on investment.
Now in order to quickly adapt to days organization organizations must be agile and that can be achieved only through a proper integrated road map.
Business leaders are always searching for ways to reduce costs, improve efficiency, and grow the bottom line – all of which must be accomplished with fewer resources.
4.2.1 GENERIC ROADMAP FOR ALL PROCESSES:
Now this approach to implementation basically gives us a logical sequence of steps on how to proceed and implement a process and its integration. Now we start off by identifying needs that would be basically done by the integration implementer using scenario based planning. Then we go on to define the critical system requirements with the specific target in mind. Now based on those specific requirements that are being defined by the process we transform them into technology a driver which pushes us to find out the alternative technologies that are available. Then we would create a technology report with all recommendations. Based on those recommendations we logically start implementing it.
Please Refer Appendix 1: For Process Flow in Excel Sheet
Road Map – Roles and Responsibilities Tabular Representation:
PART -I
Please Refer Appendix 1: For Process Flow in Excel Sheet
Now this phase of the implementation given above represent basically the plan and the priority level in the order in which it will be implemented. Here we have represented Risk analysis as a separate block because it has the highest importance in any implementation process. The corresponding players responsible are given in the right most column.
The most important factor in this sort of representation is the dependencies column that we have introduced which indicates the processes which needs to be implemented first before we could achieve the overall result.
Now again in the part II we are trying to represent the estimated time frame of all the other processes.
PART – II
Please Refer Appendix 1: For Process Flow in Excel Sheet
4.2.2 Critical Success Factor – Goal Based Approach:
These are the few key factors that organisation should focus on to be successful. As a definition it can be referred as “the limited number of areas in which satisfactory results will ensure successful competitive performance for the individual, department, or organization”. Critical success factors are help firm to decide if they have capability to build necessary requirements. Critical Success Factors can be classified on basis of their sources, such as:
Industry CSF’s : resulting from specific industry characteristics
Strategy CSF’s : resulting from the chosen competitive strategy of the business
Environmental CSF’s : resulting from economic or technological changes
Temporal CSF’s : resulting from internal organizational needs and changes
Please Refer Appendix 1: For Process Flow in Excel Sheet
Now we go on to divide the overall factors that would affect an manufacturing organization
Business Management
Organization & planning
Job cost control
Quality Control
Risk Management
Record Keeping
Financial Conditions
Cash Flow
Capital Strength
Profit Margin
Timely payment of bills
Interest rates
Pricing
Cost management technique
Owner manager characteristics
Leadership
Experience
Communication Skills
Trust & Honesty
Education Level
Political connections & contacts
Quality of work
Client Satisfaction
Quality of materials used
Teamwork
Completion of job on time
Qualified consultants
Qualified personnel
Quality of subcontractors
Use of technology
Follow & adopt new technologies
Process identification and use of appropriate technologies
Quality of technical staff
Usage of software application
Website- use of online process for various activities like procurement, handling of invoices so as to reduce paper work
Sales & Marketing
Brand image
Advertisement
Competitive pricing
Fair pricing
Sales offices
Innovative products
E-marketing
Market Selection
Experience in the market
Public needs (purchasing power)
Level of competition
These are the generic critical factors for the construction industry, but for our objective of 25% cost reduction following Critical Success Factors are more relevant. The importance of each factor can be judged from the weights assigned to each factor in the following table. Since our primary goal is reduction of cost, so business management and financial conditions are given more importance than other section of factors
CRITICAL SUCCESS FACTORS
Weights
A. Business Management
0.23
Job cost control
0.6
Quality Control
0.4
B. Financial Conditions
0.25
Timely payment of bills
0.2
Pricing
0.35
Cost management techniques
0.45
C. Quality of work
0.22
Completion of job on time
0.55
Qualified personnel
0.45
D. Sales & Marketing
0.16
Advertisement
0.31
Competitive pricing
0.38
Fair pricing
0.31
E. Use of technology
0.14
Process identification & use of appropriate technologies
0.3
Usage of software application
0.35
Use of online process
0.35
Please Refer Appendix 1: For Process Flow in Excel Sheet
CRITICAL SUCCESS FATORS – INTEGRATED TIME FRAME REPRESENTATION:
Please Refer Appendix 1: For Process Flow in Excel Sheet
4.3 Monitoring and Control Flow Mechanism
Monitoring mechanism refers to the systematic assesment and evaluation of the processes and the overall project. A continuous evaluation would help in tracking the project and taking corrective measures as and when needed.
A.Quality Management and Report Generation:
Please Refer Appendix 1: For Process Flow in Excel Sheet
The quality of all the processes are managed and regulated at the Quality management Centre. It encompassed the entire Process Development including process deisgn, process control, process review, Change management, Testing, Release Management and Process Integration. All the processes are then checked for their confirmance with Quality Standards likeISO 9000 or models such as CMMI. On non compliance, feedbacks are sent to the respective processes. Also various reports like Process Report and Completion Report are generated periodically. Also there is a system for Exception Report handler, wherein the critical success factors for fallouts (failure cases) are forwarded to Top Level Management.
B.Monitoring Mechanism for IT Implementation:
Please Refer Appendix 1: For Process Flow in Excel Sheet
Monitoring is the regular observation and recording of activities taking place in a project. It is a process of routinely gathering relevant information on all business processes and ensuring proper adherence to the project requirements. The current status of each individual process, along with its alignment with the company goal is routinely monitored and compared with its tolerance limit. If tolerance limit of the process is with permissible limit, it is accepted and feedback is sent to the process. If its not acceptable but within changeable limits, feedbacks are sent to take the required corrective actions. And if the tolerance limit is not within acceptable limits, it is rejected.
4.4 COMMUNICATION PROTOCOL
4.5 PEOPLE ENABLEMENT STRATEGY
People enablement basically deals with interaction between people, systems and management. It focuses on enabling the employees with proper knowledge and training so as to make the introduction of the IT Strategy framework smooth and effective. The employees are given training about the different processes and applications. Then depending on the organization structure and capability of the individuals, roles and responsibilities are assigned to the employees. This not only helps in achieving a proper strategic fit of the employees and technology but also in identifying people responsible for various activities. This helps in making the business process smooth in achieving the desired results.
Please Refer Appendix 1: For Process Flow in Excel Sheet
The basic objectives of People Enablement includes ensuring that people have the desired skills, identifying training interventions needed and focusing on matching the pay structure& evaluation structure with the changing needs. The various methods to achieving this would includes Training, Developing Leadership & Management Competencies, Project Management Training, Job Evaluation Review and benchmarking. The people responsible and accountable for the same are the Training officer, Project Managers and head of customer service and organization development as shown in the above diagram.
5. DETERMINING THE RETURN ON INVESTMENT FROM IT STRATEGY IMPLEMENTATION:
The returns from any IT initiative cannot be completely fathomed by just calculating the financial ROI. It needs to be looked at from a much broader aspect. Hence we have used the Business Value Framework to decide the real overall return that is obtained from the IT implementation.
Please Refer Appendix 1: For Process Flow in Excel Sheet
The way we have arrived at a final Business Value and Capability enhancement percentage is as follows-
We have looked at expected value additions under six business value heads (five intellectual and one financial).
For each value addition, we have estimated a percentage of value created and its corresponding weightage under the head.
Using a sum of products of these, we have arrived at a percentage value creation for each business value head.
Finally we have assigned weights to each business value head and computed another sum of products to reach the overall Business Value and Capability enhancement percentage.