| Benefits of ERP in India for a Construction Company | | | | process based on some criteria. |
| Construction industry in India has traditional had quite | | | | - Reduced inventory levels: Better visibility into |
| unstructured approach to business for various | | | | material lead time can reduce inventory levels for the |
| reasons. Main reason for that has been the | | | | organization. Better planning helps forecast material |
| accounting practices partially driven by the laws of | | | | demand thus allowing business to purchase material |
| the land. That scenario is changing now and more and | | | | close to consumption time. ERP allows implementation |
| more construction houses are looking at structuring | | | | of minimum reorder level process that helps address |
| their business practices to gain better market share. | | | | issue of material scarcity which at times was used by |
| There are many other reasons why construction | | | | organization to carry bloated inventories. |
| houses in India are now looking at Enterprise | | | | - Better equipment utilization: An integrated tool |
| management tools to fuel business growth. | | | | allows better utilization of construction equipment. It |
| This article discusses some benefits one can expect | | | | documents requests coming in from various sites and |
| as part of implementing ERP for a construction | | | | allows management to really get most out of the |
| business: | | | | available equipment. |
| - Waste Reduction: ERP implementation allows | | | | - Easier project monitoring: Documented project |
| generation of information that always MUST help | | | | planning allows for easier project monitoring as well. |
| reduce waste. 5% waste of cement and 3% steel | | | | One can easily monitor projects and identify key |
| waste has been accepted by the industry. Since ERP | | | | dependencies. Risk and issue management becomes |
| allows material reconcilation process to be fully | | | | lot simple due to increased visibility of information |
| automated, organizations can easily reduce this waste | | | | related to project. |
| by using various easy to implement tools and | | | | - Scalability of operations: Due to "formalization" of |
| processes. Businesses, due to large amount of data | | | | processes, organizations can scale up easier. Higher |
| involved but small value associated, does not focus | | | | % of cost can be turned into variable cost. In order |
| on material across the board. ERP allows information | | | | to scale up, one just needs to ensure that the tool |
| to be processed quickly and for a large data set | | | | supported process is followed which reduces |
| which facilitates business review of low value material | | | | "onboarding" time for new resources. Processes can |
| as well. | | | | be evolved once they are followed on a regular basis |
| - Better Project Planning: In order to get ready to | | | | and exceptions tend to limited. |
| implement ERP, the organization will be forced to look | | | | - Improved quality of work: Traditionally in India, for |
| at creating playbooks to mobilize projects. An integral | | | | construction houses, quality was not of much |
| part of this process is project planning. Traditional | | | | important. With the growth in industry and size of |
| issues with project planning or lack thereof have | | | | projects becoming increasing large, quality can not be |
| been many but lack of recorded information around | | | | compromised. Repeatable processes, recorded data, |
| what constitutes "mobilization", in my opinion, was | | | | collated information allows organizations to measure |
| primary. ERP allows the information to be collated and | | | | key indicators to improve quality across the business. |
| thus it can be translated into a repeatable business | | | | |