INTERVIEWED BY JAYASHREE MENDES
You have seen a turnaround last year. What were some of the changes in strategy employed?
We started a strategic project for driving excellence aimed at engaging people in the field with cascaded goals. The ready mix concrete (RMC) organisation structure was changed accordingly to empower people in clusters. We clubbed four to five plants under one cluster and the unit manager was responsible for running the complete business there. As part of the strategy, we focused on operational cost optimisation, distribution excellence, value selling, better customer service, latest R&D and innovations.
What are some of the value added products and services you began offering?
The offerings were based on our market study of customer requirements and the following products were introduced: ACC Supercrete uses concrete grade of M100 which is high performance concrete for high rises.
ACC-Speedcrete is a quick road solution available in two variants UTWT 24 and UTWT 12. UTWT 24 is used to build roads which can be thrown open to traffic within 24 hours and UTWT 12 is used for road repair works where roads can be opened to traffic within 12 hours.
ACC Jet-setcrete is designed to gain high-strength within three days. This variety of concrete has self-levelling features. It is suitable for use in projects which need to be completed within a short span of time. The product can be engineered to gain desired strength at required age.
ACC Lightcrete is a special concrete which is lighter than water and can be used for roof screeding and filling of sunken slabs, thus reducing dead load of structures.
ACC Fibrecrete increases structural integrity mainly tensile strength and also prevents shrinkage cracks.
ACC Flowcrete is a self-compacting concrete which is used in structures wherein congested reinforcement is required.
ACC Permecrete is an environment friendly concrete which is permeable and hence allows seepage of water through it, thus improving ground water table and avoiding water logging.
ACC Finescrete is ready-mix mortar which is delivered in transit mixers at sites for application in brick masonry, wall finishing and laying tiles.
ACC Thermalcrete is designed to provide thermal comfort in the buildings.
A layer of Thermocrete is usually applied over the top layer of the roof slab to prevent external heat or cold from penetrating into the building.
ACC Ecocrete is environment-friendly, high performance, durable concrete designed to build sustainable structures and protect the environment.
What are some of the regulatory changes that will help this industry?
As of now, there is no strict standardisation enforcement for RMC manufacturing in India. Lately QCI (Quality Council of India), a central agency, has started QA certification to regulate the concrete manufacturers/producers in India. This will ensure the quality of concrete produced for various infrastructure and commercial projects across India. This, however, shall be effective only when a formal regulation body is formed. Many local players do not follow the standard concrete manufacturing process and their control systems and commercial practices are as per convenience.
The quality of site mixed concrete is not consistent and is also heavy on logistics and needs lot of resources and space to build. How do you manage?
Exactly! Since site mixed concrete cannot guarantee consistency, we advise all customers and end users to source only RMC from reputed manufacturers. We have fully computerised batching plants to ensure consistent concrete of right grade as desired for the project.
Logistics plays a critical role since RMC must be delivered on time else it will start setting in the mixer itself. We have a dedicated team to plan and schedule orders at every plant and this teams focuses on efficiently optimising the fleet and resources including concrete pumps and manpower.
The aggregate market is highly unpredictable and it is important to have a reliable source that will allow manufacturers to consolidate. Please explain.
Aggregate market is highly unpredictable since the aggregates are generally sourced from unorganised players who cannot guarantee consistency in quality.
Changes in weather and local economic conditions also impact aggregate availability. This impacts the quality of aggregate available to us from various vendors and hence strict quality check is required to ensure that only the best material is used to make RMC.
In my opinion, aggregate industry also needs to be regulated and follow a certification process through a reputed agency like QCI will help.
What are the challenges you face for raw materials or manufacturing?
The main challenges in raw material are to ensure consistent quality and ample supply round the year. The diesel price hike has increased the transportation cost that is difficult to pass on to the customer.
What are some of the operating costs you reduced to achieve the current efficiency?
Besides costs we focused on excellence and started a strategic project for driving excellence aimed at engaging people in the field. Strategic focus was on four main levers: Operations cost optimisation, distribution excellence, better customer service, R&D and innovations. Under cost head we focused on reducing fuel, electricity, water, raw material, break-downs, wastage, etc.
Supply chain plays an important role for concrete. What is the best possible way for manufacturers to reach far-off locations with the produce?
We try to set up the plant as close to the required site as possible. Secondly we use certain chemical mixtures at times to increase the life-span of the concrete while it travels in transit mixers. We try to cut down the delivery time to customer. If the location is too remote and the requirement is huge, we set up the plant at the site itself, if possible.
What are some of the risks associated with the concrete business?
Demand is cyclic and in the current economic situation the demand has become less predictable. Aggregates form major component of raw material and to ensure supply of quality aggregates in the unorganised aggregate industry is another risk. The third risk is that the entry barrier in this business is too low and hence too many players are in this market. This business is not considered glamorous by many people and hence it is not able to attract people with leadership potential.
The cement industry is seeing a consolidation. How will it benefit the industry and customers?
The industry is expected to save some of its logistics and operations costs. The industry will get economies of scale and operate more efficiently by optimising all resources available. The customers will have better quality products and wide range of products to choose from as a result of combined R&D efforts of consolidated companies.