Wednesday, September 28, 2011: 02:17:30 PM

TJCD Guest Column

Deploy cloud to build marvels – Satish Pendse of Highbar Technologies

Cloud computing provides real estate and construction companies with access to world-class IT solutions and industry best practices in an investment-friendly model

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Real estate and construction industry in India has become increasingly competitive. Apart from large enterprise segment, there is the SME sector and the project based joint ventures (JVs), which are contributing to the same. Customer expectations have gone up substantially in terms of quality, cycle-time of completion, costs and the like.

In this scenario, IT is acting as a key business enabler by providing competitive advantage through efficiency improvement. With increasing adoption of IT by large enterprises in construction and real estate business, the need for rugged systems and processes enforceable through IT systems is felt by SMEs and JVs as well.
Traditional IT approach
Conventionally world class solutions such as SAP ERP[i] for construction and real estate industry are available ‘on-premise’, that is the companies have to procure hardware, SAP licences and implementation services. Post-implementation, they also need to manage the same for which they need SAP-based manpower. Key business benefits of world-class solutions such as SAP ERP include,
  • End-to-end visibility
  • One set of figures
  • Better controls, alerts, exception reporting
  • Reduced top management intervene required in day-to-day operations
  • Much better project management (costs, time and quality)
  • Reduction in costs (reducing inventory costs, procurement costs, improving equipment productivity and utilisation etc) and wastages
  • Reducing process cycle-time
  • Facilitate rapid business growth
  • Human resources scarcity
  • Governance funding needs
Despite such qualities, this option is not preferred by all the companies associated with real estate and construction sectors. For some companies, predominantly SMEs and JVs, the main concerns with regard to world class IT include,
  • High initial investments for world class IT systems (hardware, software, implementation etc)
  • Skilled IT manpower required to support; the same is expensive as well as difficult to retain; attention gets defocused in that area instead of mainline business issues
  • Internal readiness is low in terms of people and processes maturity in terms of adopting the world class systems. This leads to implementation risks and sustenance risks. The investments at stake are relatively higher, especially for the size of the organisation.
Several companies, therefore, tend to go for quick-fix, low-end IT systems. This may lead to issues and challenges, since such systems may have their own set of constraints in terms of bug-free, sustainable functioning, thereby impacting businesses.
It will be in the best interest of these companies if they can directly go for world-class IT systems and reap the same benefits as their peers from the large enterprise segment. This will now be possible at affordable rates through cloud computing.
Best practices at affordable price
Cloud computing, as a concept, has been existent for quite some time and is getting acceptance across the world in recent times. World class IT solutions such as SAP ERP are now available specifically for infrastructure/real estate/ready mix concrete (RMC) industries on cloud though solutions like Highbar CloudConnect. Such an arrangement provides real estate and construction companies with access to world-class IT solutions and industry best practices in an investment-friendly model.
The key benefits of world class solution such as SAP ERP on cloud can be summarised as follows,
  • Substantial reduction in upfront investments — pay-per-user-per-month
  • Rapid start – templatised
  • Access to global best practices
  • No need for own SAP manpower for ongoing support
  • De-risking
  • Level playing field for SMEs Segment
  • Best suited for JV’s (limited life span)
Real estate and infrastructure SMEs and JVs can now look forward to upgrade business processes to world class levels with the help of cloud computing model. It will also help in quick adoption of world class IT in an investment-friendly manner, without investing in technical teams to manage the system. This will provide a level playing field to SMEs vis-à-vis large enterprises. Thus, with the right IT partner who understands the real estate and construction industry, cloud based solutions will prove to be a boon to these sectors.
Satish Pendse, president of Highbar Technologies, a Mumbai-based leading IT solutions provider for the infrastructure industry. The company is a part of the reputed HCC Group.


[i] Enterprise resource planning

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