It’s the defining business trend of our time - Digitalization. Given how organizations world over have been scrambling to put together strategies to embrace digitalization in some shape or form, it is only fair that we accept it as such. Today, nearly everything that a business does, regardless of its size or industry, stands to be affected by it. Together Cloud Computing, IoT, Embedded Devices, Sensorization, Augmented Reality, Wearables, AI & Machine Learning, and Big Data Analytics are fast revolutionizing entire value chains and reshaping operations in a way few could have imagined until very recently. Digitalization also stands to recast customer and stakeholder expectations and set new grounds for how effectively businesses deliver on their promises to both.
L&T which has long prided itself as a technology-driven enterprise identified digitalization as one of its key vehicles for future growth early, much before it became fashionable for C-Suite types to toss around the idea at strategy meets and business gatherings. L&T CEO & MD Mr. S.N. Subrahmanyan has been advocating harnessing digital technologies to drive growth and create sustainable competitive advantage since even before he took over the Company reins. Viewing it as a potential differentiator, he encouraged L&T Construction businesses to employ geolocation and digital mapping, cutting-edge design software, sensors & IoT platforms, advanced analytics, collaboration tools and mobility solutions to execute projects better. Believing it to be a driver of significant cost savings and operational efficiency, Mr. Subrahmanyan contends that digitalization can transform not just Construction but all the constituent businesses of L&T, and lead to a quantum leap in the performance of the entire Group.
L&T’s digitalization journey began sometime in early 2016. As the Company set about charting a fresh course for itself through Lakshya 2021, its five-year strategic plan, businesses from L&T Construction began identifying technologies which could be used to digitalize different aspects of their operations. Given L&T’s presence across sectors seemingly far riper for digitalization viz., engineering, manufacturing, power, it was somewhat incongruous that the Group’s largest business should test the digital waters first. This is not to say that the idea of digitalizing L&T Construction wasn’t a valid one. Far from it, it simply means that other businesses where digital technologies could’ve been piloted more readily, could have taken the lead. But such was the strength of Mr. Subrahmanyan’s conviction that L&T Construction trod the digital path before everyone else.
Encouraged by this belief, different businesses within L&T Construction developed clear strategies and identified operational areas which could be augmented digitally using available tools. The effort resulted in thousands of equipment across project sites getting fitted with sensors which in turn were integrated with cloud platforms and analytics engines, introduction of GPS-based Plant & Machinery (P&M) monitoring, use of building information modelling (BIM) software for project design, and mobile-based solutions for tracking work progress, and a host of other solutions that offered a real-time view of on-going activities leading to greater operational efficiencies and a step change in productivity.
As part of the digitalization agenda, L&T Construction’s Transportation Infrastructure (TI) business vertical deployed a range of digital solutions for enhanced visibility and decision making. As per Mr. Sudip Mazumder, JGM and Deputy Head - Digital, it has deployed AssetInsight, an IoT Big Data Analytics Hub which can analyze every connected P&M item and worker at a site to offer insights on asset utilization and productivity on a near-hourly basis. “We can generate insights on how the Motor Graders or Pavers are utilized over a 24-hour cycle, how much of their movement is productive and otherwise, which are the best performing machines and how do two same category machines compare etc. Such information allows us to take constructive action in time helping us save substantially on cost of operations.”
TI, along with other businesses has also implemented an analytics engine ‘Alchemy’ which processes an impressive 3.2 GB data per day to identify patterns and generate actionable intelligence. Through a solution called Procube, managers can plan and track daily progress at remote sites with just a few touches on their mobile screen. Besides, supply chain solutions, such as Boulder-2-Concrete (B2C), have been deployed to track different types of materials (Aggregates, Tools & Tackles etc.) at sites to prevent possible wastages.
Mazumder informs that some solutions are embedded with Voice Bots to make it more practical for users. There’s even an AI-powered chatbot QT in Highway Engineering, which, users access on Facebook@Workplace, to provide on-site highway engineers with quick answers to their queries on Indian Road Congress and other regulatory guidelines and provisions. EHS function, in TI and other businesses, has turned many of its processes paperless through mobile app. Not to mention Virtual Reality based safety immersive training which is becoming increasingly prevalent across its project sites.
MMH Solves Logistics Riddle through DigitalizationMr. Saikat Sengupta, Sr. Manager (Mech), Metallurgical and Material Handling (MMH) SBG can barely contain his excitement when talking about Digitalization. Calling it the best gift for the future of the construction industry, he predicts that in the next 15-20 years, digitalization could halve its current dependency on labor. He submits MMH’s innovative solution for the sourcing of logistics partners as evidence. For the longest time, sourcing reliable and cost-effective logistics partners in time had remained a challenge for the MMH business vertical. Given the unorganized nature of the logistics industry, sourcing managers at MMH would have to contend with issues such as negotiation delays, delayed pickups, late deliveries, sub-standard services, errant drivers, and a general lack of visibility in the logistical operations. To address the situation, the digital team at MMH along with the CPC team automated sourcing of logistics service providers through the use of digital technology and brought in much needed efficiency in the process.By deploying SuperProcure, a cloud-based workflow software platform, the team was able to digitize the process and put in place a reverse-auctioning system to get quotes from multiple vendors and transporters. The customized solution ensures that except for floating of enquiry and printing of comparative bids (to get internal approvals) everything else, including negotiation is completely automated. The solution, deployed earlier this year, has resulted in greater transparency and higher compliance rate from the service providers and reduced the sourcing time by almost 80%; the cycle time from floating the enquiry to finalization has been reduced to 1-2 days from 7-10 days. Besides this the SBG has deployed a number of project specific initiatives catering to very specific needs, like smart materials tracking, smart procurement system, JCR analysis, and implementations that monitor staff level productivity and responsibilities.
Over at the Heavy Civil Infrastructure, digital solutions are being employed to not just augment processes but also to tackle the growing complexities of scale and project size. Mr. R. Nakkiran, Head Corporate Centre, says that in the current age of extremes, projects have become so complex in nature that building them using the traditional methods of the past is just not feasible. “New design tools and techniques like BIM, 3D mapping, 3D printing, drones, and mobile app based platforms for safety, quality, asset inspection etc. are becoming an inseparable part of modern construction,” he says.
Alluding to the Medigadda Barrage Project, located in Telengana’s Karimnagar district across the river Godavari, he details how a Concrete Management System developed internally helped streamline concreting activities for the prestigious project. Since the project required extensive usage of concrete, the digital team implemented the system to plan, monitor, and control concreting and its allied activities on site. The project involved construction of a 1,625m long barrage with 85 vents, radial gates with rope drum hoist arrangements, 2,592m of guide bunds on either side of the barrage plus other appurtenant structures. Aided by the concrete management system, the Medigadda project commenced in March 2017, is being monitored digitally by the project team and is on track for early completion, informs Nakkiran.
Creating Virtual WorldsAfter a project walk-through at ‘Srishti’ in Chennai or ‘Drishti’ in Mumbai, L&T’s 3D design studios, those who charge construction firms of not being technologically savvy are sure to think twice before labeling the sector as a laggard in terms of tech adoption. Using VR and 3D modelling, the facilities enable things like virtual prototyping, design reviews & analysis of virtual models, and walk-throughs for customers to give them a real-world feel of the actual project before execution. For projects like the Hyderabad Metro and the upcoming Statue of Unity in Gujarat, design engineers and project teams have made considerable use of the said facilities. Plans are afoot now to developing means by which 3D models in VR can also be viewed outside of such studios, at construction sites using wearables. Additionally, Augmented Reality (AR) which blends the virtual and the real worlds to offer a digitalized and highly interactive version of the reality, is also being evaluated for application across businesses.
The Buildings & Factories business vertical known for executing airports, commercial buildings, hospitals, shopping malls, factory structures etc. has reduced project cycle times by embracing technology and mechanised execution. Recognized as the Most Digitized business of L&T Construction for 2017 B&F has deployed a number of digital initiatives. Offering a quick glance into some, Mr. Praveen Rao, Head – Digital Development & Analytics, rattles off a long list that includes using Procube for daily progress monitoring at project sites, connecting more than 80% of its strategic assets to cloud, automation of batching plants, mobile based asset inspection, using geospatial survey for project planning, and a mobile based app for connecting workmen across its major project sites. By automating and connecting batching plants at its project sites the digital team at B&F offers users the ability to monitor the health and the efficiency of each plant on a real-time basis. They have access to information such as fuel consumption, consumption of material, even data as to which mixers work better which in turn allows site engineers to take appropriate action in a timely manner.
Further, it has implemented a novel RF-based tracking solution which can trace elements throughout their lifecycle, right from the manufacturing stage through to its positioning in a finished structure. The solution has been used in Statue of Unity and a few government projects in Andhra Pradesh. The business has also deployed a mobile app to capture and track quality issues at its project sites. A high-impact deployment, Mr. Rao claims that the app has been helping project teams identify quality issues early and prevent instances of major rework.
Digital Safety Net for Workmen Having identified safety as one of the core thrust areas of organizational excellence, businesses across L&T have been working overtime to foster a culture of safety and are turning to digital technology to improve employee safety standards. With a large of chunk of this involving education and safety awareness, technologies like virtual reality (VR) are being put to use. At several locations, VR-based safety training modules have been developed to familiarize workmen with the risks of working in hazardous environments. These simulated environments give workmen a real-world feel and educate them more effectively about the DOs and DON’Ts of safety in specific surroundings and correct procedures to follow in cases of emergency. Additionally, with the help of technologies like RFID, BLE, and LORA measures are being evaluated and deployed to monitor and track movement of workmen at project sites to ensure untoward incidents from happening. Such deployments are also making it easier for managers and safety professionals to monitor and control activities more accurately from a safety standpoint. Further incident reporting is also being automated through the use of mobile apps leading to shorter reaction times for better safety management.
One of the more exciting projects the digital team has embarked on recently involves making use of augmented reality (AR) by using smart glasses at project sites and using virtual reality (VR) gear for training workmen on safety.
While it may have been L&T’s construction businesses which took the lead on Digitalizaion, it did not take too long for the idea to catch on elsewhere, in other parts of the Company. There is ample evidence to suggest that the Group’s non-construction businesses are marching ahead with digital transformation albeit at varying paces, and enjoying a fair degree of success.
L&T Hydrocarbon Engineering deems Digitalization essential for its future growth and has covered a fair bit of ground in the short time that it embarked on its digitalization journey. Mr. Rakesh Dhanda, Head - Digital, believes that as LTHE continues to expand globally, adoption of digital solutions in the EPC value chain will help it improve collaboration, effective execution of projects in complex environments, enable faster and accurate decision-making.
LTHE’s flagship initiative in its Digital journey involves implementation of an Integrated Project Management System (IPMS) that would provide real-time visibility across the end-to-end project management value chain with multi-dimensional visual modeling.
Further, the LTHE digital team has deployed QR code and mobility-based piping spools and structural steels assemblies tracking system which improves material status and location visibility through digital tracking. Besides this, GPS-based equipment tracking allows project teams to access Material Handing Equipment’s information such as real-time location and distance travelled to optimize the utilization of plant & machinery at construction sites.
The business has also implemented a cloud-based solution for e-Auctioning, that enhances its supply chain performance and has plans to further extend it to e-Procurement that would bring efficiency in procurement and effective controls in delivery schedules, cost and quality. A unique smart glasses-based solution is also currently in use for a real-time view of construction site for survey, inspection, reviewing work progress and providing technical support from remote locations. Modern digital applications such as AI & IoT for real-time tracking for people and assets, drone based site surveys, VR/AR apps for construction & commissioning, market and bidding solutions, RPA in Finance, Chatbots in support and services functions are being explored for future.
L&T Heavy Engineering’s current expectations from digitalization initiatives revolve around productivity and quality improvements. Binoy Shaw, Head – Manufacturing Technology, sees digitalization as the main source of value-addition on both these counts. Talking about some of the ways in which the business is employing digitalization, the digital team brings up automating the welding processes using “smart machines” which allow for greater degree of control and real-time monitoring of activities on the shop-floor. Smart welding stations have also freed up human resources and led to improvement in operator efficiency.
Similarly, by using advanced metrology during fabrication, visible improvements have been made on counts of measurement accuracy, speed, and reliability. Engineering processes are also being enhanced through the use of drawing automation tools and an innovative engineering hours booking system has enabled a clearer view of the activity and is said to create additional engineering capacity.
Challenges for DigitalizationThe practitioners of digitalization believe change management to be their biggest challenge. To them the task of transforming the organizational culture and engagement of employees through the digital journey is often the trickiest aspect of their job. For, digitalization not only affects the organizational “pace” – something that not everyone is readily willing to accept – but also threatens to affect hierarchies and silos in a way that many would find difficult to adjust to. Another area of concern is lack of expertise, both in-house as well on the outside for adequately supporting digitalization projects. To this end, it’s required that organisations work at developing a digitally literate workforce and impart skills needed for a digital transformation. Last but not the least, those in the discipline believe that organisations need to develop a distinct “digital outlook” and not see digitalization through the ‘technology’ lens. Digitalization is about changing processes, methods, behaviour, practices and dealing with resistance and barriers that often arise from psychological ends.
Sanjay Chakraborty, Head – IT & Digital sees a natural fit for digitalisation at his business - L&T Defence. “This is a business where robotics, process automation, systems development, advance communication and model based engineering is a way of life,” he says. Singling out digitalization as a key tool for operational visibility and weeding out inefficiencies and profit leakages, Chakraborty notes three vectors in which L&T Defence plans to move forward in its digital transformation journey viz., Digitisation (Manual to Digital, Automation of Workflows), I4.0 Technology & Analytics Interventions, and Model-based Engineering through Digital Manufacturing.
The business has identified Connected Customer as a major theme for itself whereby it is enhancing product and services by using Artificial Intelligence (AI) and Mixed Reality (MR) based applications. Through digitization and automation of processes, specifically Digital Asset Management, Fullkit Management, Laser Metrology, Production Flow Tracking, it is attempting to reshape existing operations and give it a more “Connected” orientation. By deploying IoT in the machine shop it is also hoping to increase Overall Equipment Effectiveness (OEE) at the factory level. Further it plans to build a platform for connecting Business Partners, conduct online inspection, carry out GPS tracking, and perform things like spend analytics as part of building a Connected Supply Chain.
It’s clear from these examples that there is a concerted effort underway across L&T to transform it for a digital world. That businesses, using digital tools, are reconfiguring key operational areas to bring in additional visibility and enhanced productivity. And while they may not have in their digital maturity curve graduated to a level whereby they can affect entire business models or significantly alter the end-customer experience through digital means, the building blocks of a digital transformation are being put in place, one by one.
A digital L&T cometh!
Mr. Anantha Sayana, VP & Head - Digital, L&T Construction, believes that to effect digitalization in a true sense, practitioners need to have a distinctly digital attitude. He speaks to News & Views about the digital state of affairs at L&T.
Q: In terms of L&T’s overall readiness – the collective preparedness of its businesses across the Group – how well placed do you think we are on the digital front?
A: We are well on our way and more than two years into that journey. Digitalization was identified as a major thrust area in our Lakshya 2021 plan and we are on the job. We began our Digitalization programme with the Construction business in early 2016 and over the last two years, have made good progress.
We have developed our strategy, identified areas for digitalization largely focusing on our core operations at project sites, evaluated technology options, selected partners, developed solutions and our implementations have reached hundreds of project sites and touched thousands of users and equipment.
With respect to the other businesses, Digital Leaders have been appointed and niche solutions in each business are at various stages of development and implementation. A pan-L&T Digital Council has been formed with representation from all the businesses to enable synergy and learnings from each other.
Q: Which one of our businesses are especially primed for digitalization according to you?
A: Globally you will find that the most successful stories of Digital are in sectors like retail, travel, hospitality, banking, insurance, telecom and so on. However, when we started looking at these new digital technologies with respect to construction, we realized that the opportunity was immense and we could actually do digital in literally every aspect of our operations in construction. So construction is huge for digital and we are already seeing success and are all set to do more.
There is big opportunity for our businesses in manufacturing. Key businesses like Defence, Construction Machinery, Valves, Power, Hydrocarbon have a large manufacturing footprint and we could do much for these businesses. A few initiatives have been started across these and deployments are currently on at various stages of implementation.
There is a large opportunity also in our products business. We could make all our products “smarter” by implementing IoT in everything that we make. This will give us an edge in the market and enable us to combine services and analytics along with our products to even evolve a changed business model and disrupt the market.
Q: You’ve led L&T Construction’s digitalization drive for some time now and have tasted success doing it, can you share some of your key learnings from your experience so far?
A: I think we did a few things right and it has stood us well. The Digital team needs to be distinct from the IT team and have a distinct “digital attitude” – be very customer centric, be on top of all new technology trends, focus on speedy and agile delivery, take risks, partner with small startups etc. Building this team has been one of the reasons for our success. At Digital we have a fantastic team that is a wonderful mix of internal and lateral talent, lots of young people, all enthusiastic and passionate about Digital. Across all the construction businesses, we have smart young Digital Officers and Digital Champions who work diligently to bring it all to fruition.
Change management is another very important factor. We are very fortunate that our MD & CEO Mr. S.N. Subrahmanyan is extremely passionate about Digital and is a very active, vocal, and visible sponsor. He has been espousing the cause of digital at every forum and every interaction that he has. The message from him has been very clear - that we need to Digitalize and that it is the future.
The other learning is that we need to design applications with better, more user-friendly UI for greater usability and adoption. We need to use innovative means to reach our users to tell them about the business benefits of using digital applications and to take actions for realizing the benefits. We are focusing on this in a big way right now.
Q: For businesses testing the digital waters for the first time, what would you say are some of the major pitfalls that they need to avoid?
A: Digital is not about doing a few small pilot projects or proof of concepts with technology. Digital solutions have to touch our core in a large and pervasive way. Therefore we need to be bold and big and reach for a very large program. Digital solutions need to scale and cover all areas of operations and need to be implemented at scale. We need to do all our design keeping this in mind.
Another thing is that we need to act with speed. Digital cannot take too long to show results. Solutions need to be made to reach the users fast and their benefits have to be seen.
Q: Given the hype around digitalization and the big payoffs being ascribed to it, do you think that there is a danger of organizations setting their expectations too high?
A: Yes, expectations from Digital can be at times too high, given the hype that has been created. One has to realise that the Digital Transformation is a process that involves not just a technology implementation but also its absorption by the business, the users, the customers and all the stakeholders in the value chain; therefore it will take time.
But it is good to set milestones, push for speed and coverage, and aim for a certain level of gain through benefit realization. Digital is not being pursued for fascination with technology, it should result in tangible benefits for the business, some in the short term and some in the long term.
Q: Tell us more about your role as the convener of the Digital Council and how it’s likely to aid digitalization efforts across the Group?
A: I have been guiding the digitalization efforts of many of the businesses at L&T informally even before the formation of the Digital Council. The council is a formal arrangement that brings representatives from different businesses to come together, share and learn. As the convener I not only bring them together but also provide guidance, inspiration and support for the digitalization efforts at their respective businesses.