PRODEVSYS
( PROJECT DEVELOPMENT SYSTEM )
A
CONCEPT NOTE
by
Hemen Parekh
Mumbai
20TH JULY 2004
www.B2BmessageBlaster.com
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Marketing
of Project Development Systems
A
Concept Note
BACKGROUND
G O I
has opened up the economy under its liberalization-program.
This process
is irreversible and will gain momentum in the coming years
A key structural feature of this new
policy, is PRIVATIZATION, in all sectors of the Economy. This will be particularly so in the areas of :
-
Infrastructure Development
Road / Transport / Rail /
Air / Telecom / Power / Ports / Airports / Cross-country pipe lines / Bridges /
Tunnels / Dams / Jetty etc.
-
Property Development
Townships / Mass Housing / Commercial
Complexes / Sports Stadium / Convention Centres / Holiday Resorts etc
-
Industrial Structures
Process Plants / Manufacturing Plants
/ Industrial Estates etc.
Development
of these sectors is vital to rapid growth of economy.
Central/State
Govts. have no funds to spare for these projects. Hence private-sector participation on a
big-scale is inevitable.
Even
foreign parties will be encouraged to enter these areas by forming
joint-ventures with Indian Partners.
Any
Industrial Group wanting to grow rapidly must exploit this opportunity.
This must be done quickly before the field
gets crowded with competition.
Timely
action is the essence.
A
major part of Infrastructure/Property Development Projects consists of :
- System Design
/ Engineering / Technology
- Construction
( leaving out equipment-supply )
It takes many years
to build-up expertise / human assets / plant & machinery assets to become a
major Property Development Company.
This is, therefore
the single – biggest hurdle for anyone wanting to be a key player in this
sector.
It is, therefore, in the light of the foregoing
observations that I have developed a concept called,
P R O D E V S Y S
Project
Development System
|
CONCEPT
|
PRODEVSYS is a concept under which a company interested
to make rapid strides in Project
Development shall develop an EXPERT SYSTEM.
This
system shall, broadly cover following modules :
·
TECHNOLOGY
·
FINANCE
·
MARKETING
·
PROJECT
IDENTIFICATION / EXECUTION
·
LEGAL
MATTERS
·
LAND
ACQUISITION
·
CENTRAL
GOVT. / STATE GOVT. LIAISON
PRODEVSYS
|
PROJECT MANAGEMENT
EXPERTISE SYSTEM
|
 |
|
MARKETING
EXPERTISE
SYSTEM
BRAND –
SELLING
|
|
TECHNOLOGY
ASSIMILA
–
TION
EXPERTISE
SYSTEM
|
|
FINANCING
EXPERTISE
SYSTEM
|
Each
of the above-mentioned departments ( of the company ) will compromise of a few EXPERTS ( and a few supporting staff ).
The
idea is to have a (manpower-wise) lean organisation, heavily dependent on computerized,
networked EXPERT – SYSTEMS and a
very efficient telecom system.
The
central idea behind an EXPERT – SYSTEM based
organisation is that the organisation itself shall not :
- Engage in actual construction
- Develop System-Designs or Construction-Methods, on its own
( i.e. Technology - Development )
But it will have a huge
- Engage in Architectural
designs or Structural designs
- Own / operate assets such as Construction –
Machinery
The
organisations, shall enter into “Project-wise”
technical collaborations or joint –ventures with overseas ( or even
Indian ) companies to execute the Projects
These
companies will be selected on the basis of their perceived “Expertise” in that
particular field of construction.
These
tie ups will be aimed at “tapping” from
abroad ( or from within the country), the most appropriate “Technologies”
needed for the execution of a given project.
The
main MODUS OPERANDS of this Organisation will be :
OUT
- SOURCING / SUB -
CONTRACTING
|
THE THEME
|
The THEME will be :
Do not duplicate
within the organisation, the Skills and the Expertise and the Experience which
other organisations have already built-up over years.
Let us HIRE these Skills
/ Expertise / Experience in the
execution of our projects.
The only skills
that we shall develop " In-house ", are the skills to :
- * Identify the best vendor /
supplier of such skills
- * Frame the “ Scope of work ”
sand “ Terms of Reference ”,
to
enable such outside expert-organisations to submit their
- * Study / analyse /
interpret the offers
- * Negotiate the “ Contracts /
Commercial Terms "
- * Monitor the performance of the contractors
and motivate
And such “ Out – Sourcing” shall not be confined only
the
-
“ Financing ” contracts
-
“ Marketing ” contracts
-
“ System Design ”
contracts
-
“ Detailed Engineering ”
contracts
-
“ Procurement ” contracts
“ " Architectural / Structural / Monitoring ”
contracts
-
( i.e.
Project Management Contracts )
“
Operating ” contracts
( to manage the property after Commissioning )
The EXPERT Organisation will , by itself, not undertake
/ manage any activities
By definition, it will only,
Manage the “ Managers ” of various activities.
It will actually Orchestrate / Coordinate / Synthesize
/
Blend / Amalgamate the efforts of a large number of
SPECIALIST COMPANIES
,
each of which is
“ Expert ” at some specific aspect of the
Project.
So the CORE – COMPETENCE of our company will be to
- “ Manage
” a
– and through them,
their
-
Raising “ Finances ”
-
“ Marketing ” the concept
of the project
-
“ Designing ”
-
" Constructing ” etc.
-
It is only such an
approach that can catapult a company in
the BIG – LEAGUE within a short – span of time and with
minimum of resources.
|
RESOURCES
|
Manpower
I have earlier said that there will be only 6 / 8
departments .
And may be 60/80 persons altogether ( half of whom will
be
Experts in some or other field )
Space
To begin with an office – space of 10,000 sq - ft should suffice
to kick-off the operations
Equipment
These will be largely office- automation equipment such
as
-
Computer Systems
-
Telecom Systems / Modems
-
Audio
/ Video equipment
-
Photocopying
equipment
-
Software
packages.
-
Library
( Books / CDs )
-
Finance
Here again the idea would be to deploy a bare minimum
of
“own” funds.
Fund shall be raised from “ Investors ” as
* Down Payment
* Progress Payments
as each project advances.
.
|
FUNDS
|
The
funds shall be raised by giving-out “ Franchises “,
-
Convention Centres
-
Theatres / Cable TV Services
-
Amusement Parks
-
Exhibition Halls
-
Restaurants / Hotels
-
Transport Systems ( for township )
-
Educational Institutes
-
Telecom Services
-
Shopping Centres
-
Banking Premises
etc.
It is envisaged that the “ Investors ” and the “ Franchises
”
shall be two separate sets of people.
For certain projects, it should be possible to float
widely
held, public – limited companies and raise funds from
-
NRIs
-
Overseas Mutual Funds
-
Public at large
|
ORGANISATION
|
|
PRODEVSYS
EXPERT COMPANY
|
 FUNDS |
|
FRANCHISES
|
|
EXTERNAL EXPERT SERVICE – SUPPLIERS
|
|
NRI
|
|
SYSTEM DESIGN
|
|
MUTUAL FUND
|
|
ENGINEERING
|
|
PUBLIC DEPOSIT
|
|
CONSTRUCTION
|
|
PROJECT MANAGEMENT
|
|
PUBLIC EQUITY
|
 |
|||
 |
|||
|
ADVANCE
FROM INVESTORS
|
|
OPERATING
RUNNING THE PROJECT
|
 |
The PRODEVSYS Company shall primarily focus
on the DEVELOPMENTAL aspect.
As far as “Execution” aspect is concerned,
the emphasis shall be on the
Management of Execution
, rather than the execution itself.
Over a period of time, PRODEVSYS must come
to be recognized as a BRAND which is synonymous with property-development
projects.
It will undertake such projects, not only
on its own but also on behalf of others, who do not have the necessary
expertise to get into this business.
For such individuals or Corporate,
PRODEVSYS will provide a TOTAL TURNKEY solution.
In fact, a time shall and come when
PRODEVSYS can been seen as
“ A Solution in
Search of a Problem ”
Over the last 3 years, we have seen that
hundreds of companies have gone to public and raised thousands of crore of
rupees from the market.
Almost anybody has been able to raise funds
in the market. So apparently there is no dearth of funds.
But whereas any number of companies have
been able to raise funds, very few have been able to put-up their projects in
time, largely due to lack of expertise in
“ Project Planning & Project Management
”
This is where the USP of PRODEVSYS comes
in, viz :
PROJECT PLANNING / PROJECT
MANAGEMENT
But it is not merely another Project –
Consultancy or a Project Design Organisation , undertaking such assignments on
behalf of “Clients” and earning a meager fee , employing hundreds of engineers.
|
COMPARATIVE
SCENARIOS
|
Project
Consultancy Vs Project
Development
-----------------------------------------------------------------------------------
The following tabulation will clearly
bring-out the differences :
|
|
PARAMATER
|
A TYPICAL
ENGINEERING
CONSULTANCY
CO. WORKING FOR OTHERS
|
PRODEVSYS
( DEVELOPING
IT'S OWN PROPERTY)
|
|
1
|
Conceptualising
|
X
|
ü
|
|
2
|
Project
Identification
|
X
|
ü
|
|
3
|
All
Permissions
|
X
|
ü
|
|
4
|
Land
Acquisition
|
X
|
ü
|
|
5
|
Funding
|
X
|
ü
|
|
6
|
Technology
/ Engineering
|
ü
|
To
be sub –
contracted
|
|
7
|
Construction
|
Sometimes own
Mostly given out
|
ü
|
|
8
|
Marketing
|
Tender based
|
Aggressive,
Concept-based Brand Selling
|
|
9
|
Planning
/ Mobilising
|
|
X
|
|
10
|
Procurement
|
Rarely-mostly
done by client
|
To
be sub -
contracted
|
|
11
|
Project
Execution
|
Own team
|
To
be sub –
contracted
|
|
12
|
Implementation
/ Commi –
ssioning
|
By self
|
To
be sub –
contracted
|
|
13
|
Operating
|
X
|
To
be sub –
contracted
|
|
14
|
Franchising
|
Not Applicable
|
ü
|
|
15
|
Equity
base
|
Small
|
Small
|
|
16
|
Asset
base
|
Small
|
Small
|
|
17
|
Manpower
|
Large
|
Small
|
|
18
|
Equipment
|
Nil
|
Nil
|
|
19
|
Working
Capital
|
Nil
|
Large
|
|
20
|
Profit
Margin
|
Low
|
High
|