The Digital Play
SN SUBRAHMANYAN shares how L&T has adopted state-of-the-art technologies to transform its own operations across a variety of digital platforms.
Although the name Larsen & Toubro (L&T) conjures up images of glorious landmarks and awe-inspiring brick and mortar structures, engineering and technology have been integral to L&T’s DNA, reflected in the gradual but definite enhancement of the company’s technology footprint. LTI, the Group’s IT services company, has grown steadily over the past two decades while L&T Technology Services (LTTS), which specialises in engineering and related services, has been making its presence felt for over 15 years.
In 2014-15, the world witnessed a tectonic shift towards digital technologies that helped create new processes, new business models and entirely new businesses.
SN SUBRAHMANYAN shares how L&T has adopted state-of-the-art technologies to transform its own operations across a variety of digital platforms. Although the name Larsen & Toubro (L&T) conjures up images of glorious landmarks and awe-inspiring brick and mortar structures, engineering and technology have been integral to L&T’s DNA, reflected in the gradual but definite enhancement of the company’s technology footprint. LTI, the Group’s IT services company, has grown steadily over the past two decades while L&T Technology Services (LTTS), which specialises in engineering and related services, has been making its presence felt for over 15 years. In 2014-15, the world witnessed a tectonic shift towards digital technologies that helped create new processes, new business models and entirely new businesses. Effortlessly adopting these state-of-the-art technologies, L&T has transformed its own operations across a variety of digital platforms. Digital transformation L&T’s digital transformation began in early 2016 within its construction business, first with the creation of a new digital group from scratch. Growing exponentially, in less than three years, every possible technology like Internet of Things (IoT), Cloud, mobility, drones, building information modelling (BIM), augmented reality (AR), virtual reality (VR), analytics, AI, and ML scanning have been tapped and put into production. At present, over 50 of these digital solutions are in production and widely used by thousands of L&T’s operating staff at hundreds of project sites. Over 11,000 construction equipment are connected, providing real-time visibility into operations that enable improvements in productivity and better utilisation, better maintenance and uptime and superior fuel efficiency, resulting in quicker project execution and cost saving. Mobile apps have digitalised every process relating to safety, quality, activity completion and materials tracking, streaming real-time information from sites to monitoring offices. Geospatial technologies like drones, LiDAR, 3D scanning, photogrammetry and the like have rendered gathering of geographic information quicker, accurate and more economical, and engineering and estimation more accurate and competitive. Having started in construction, L&T’s digital transformation has spread to all other businesses too, with manufacturing factories connected, implementing Industry 4.0 solutions, and adapting solutions from construction for improving workmen safety and productivity, material tracking, equipment monitoring and project progress monitoring. L&T’s success proves that digital transformation is possible at scale and speed, that it yields tremendous benefits, transforming how people work, enabling them to take data-driven decisions. Having covered the internal bases, L&T has launched a systematic and multi-pronged approach to tap external business opportunities in the digital space with the Group’s IT service companies beginning to develop digital solutions for their clients. To tap the huge potential in the areas of big data, analytics, machine learning and AI, L&T has made a series of acquisitions over the past few years affording quick access to develop some of the cutting-edge technologies, solutions and skills required. These acquisitions have been quickly integrated into the solution offerings of LTI and LTTS for their clients to beef up their presence and revenues in the digital space for better and faster growth. LTI’s investments Perhaps the most significant of L&T’s acquisitions in recent times has been that of Mindtree, a company with expertise to deliver digital transformation and technology services right from ideation to execution. Mindtree merged smoothly into L&T’s portfolio and, together with other IT service companies, is providing a slew of capabilities and offerings. L&T’s clutch of IT companies have become a force to reckon with across several industry verticals. At the same time, with the world seeking more intelligent and smart solutions, L&T’s Smart World & Communication business with expertise in city surveillance and security, communications and smart cities has started to make a name for itself by helping governments and city police forces in many ways hitherto unthought of. This business unit today houses enormous capability and talent in networking, security, surveillance, video analytics and developing integrated command-and-control centres, and uses AI for many of its solutions. Sensing a huge opportunity, L&T has created L&T-NxT to monetise and market its digital solutions to industry verticals in and adjacent to its areas of core domain expertise. Simultaneously, L&T-NxT is refining its solutions, adding to its capabilities and resources, and preparing to hit Indian and overseas markets not just with IT services but tested and proven digital solutions as well. Future-ready ventures The digital revolution is sweeping across several other industry verticals outside of L&T’s core competence like education and supply chains. To leverage the potential in those realms, L&T has formed Edutech and Sufin, two ventures being grown ground up to become valuable digital properties for L&T going forward. Edutech: With a strong pedigree in skilling and learning and development, L&T is poised to expand its skilling initiatives targeting a larger audience, especially the youth, to offer an integrated platform spanning skilling to recruitment, leveraging L&T’s inherent expertise and strengths in core engineering, manufacturing, technology and its pioneering efforts in digitalisation. Edutech will focus on three areas of opportunity: employability assessment and recruitment; reinforced learning and reskilling; and vocational skills training. Sufin: This is a financial supply platform to establish L&T’s presence in the e-commerce marketplace. Leveraging its strong brand salience and leadership, L&T is well-placed to enter this space on the strength of its relationships with suppliers, SMEs and the ecosystem at large, drawing on the strength of group company L&T Financial Services. Innovation Fund: This aims to invest in attractive start-ups operating in industries and domains that are congruent to L&T’s businesses with a purpose to augment and differentiate L&T’s core business lines, develop capability at the individual business vertical level to enhance technical capability and commercial access with investments and collaborations with start-ups to establish a venture capital capability within L&T by building an internal team with the expertise to evaluate, invest and manage portfolios. L&T is moving towards an attractive, balanced portfolio. At its core, the Group will continue to build things that make India proud, set new benchmarks in project execution and benefit from digital technologies for enhanced operational efficiencies. About the author: SN Subrahmanyan is CEO & Managing Director of Larsen & Toubro (L&T) and serves on the board of directors of this multi-billion dollar conglomerate. Under his leadership, L&T has transformed itself into a company that executes a wide range of mega projects at speed and scale and, in the process, builds the tallest, largest, longest, smartest, and most complex. He is also Vice-Chairman on the boards of LTI, L&T Technology Services & Mindtree and Chairman, L&T Metro Rail (Hyderabad) Ltd.