Cethar to implement transparency measures for higher sales

April 17th, 2009 - 3:37 pm ICT by IANS  

By Venkatachari Jagannathan
Chennai, April 17 (IANS) For K. Subburaj, chairman of the Rs.725-crore boiler manufacturer Cethar Vessels, the economic slowdown has taught two important lessons - put everything on the client’s table, and not dip into his own resources till pending dues are cleared.

And so, Cethar will provide online access to its clients to the project evaluation review technique (PERT) chart - first developed by management consultants Booz Allen Hamilton in 1958 for the US Navy - that will analyse the tasks involved in setting up a project, the time needed to complete it, and critical during the current downturn, the customer’s payment schedule and task-wise dues.

“Ours will be the first company in the industry to provide online access to the PERT chart to customers to check for themselves the project status,” Subburaj told IANS.

The programme system developed in-house will also show the number of workers to be deployed for each activity.

The software programme also has a feature that can calculate the “business loss” or opportunity cost that Cethar incurs on delayed payment. This will enable the company to demand payment for the work on schedule so it can deploy its own resources executing contracts where payment is not an issue.

“We don’t want to make the mistake of using our funds to complete an order when there is a delay in payments by clients,” Subburaj said.

“It’s certainly a novel idea as far as India is concerned,” said M. Amjad Shariff, joint managing director of the Rs.646-crore Shriram EPC, a city-based engineering, procurement and construction company.

“Overseas companies do this. It enables clients to know the status of their project and reasons for delay if any,” Shariff told IANS.

First to be provided with the PERT facility will be Aryan Coal Benefications that plans to source two 135 MW boilers from Cethar.

With this initiative, the Tiruchirapalli-based Cethar also hopes to counter charges that it lacked project management skills.

“We couldn’t have installed several industrial boilers in the country had we lacked such skills,” Subburaj remarked.

He, however, conceded that the slowdown would likely impact fresh orders this fiscal too despite the increase in the number of enquiries.

“Not long ago, say in fiscal-2007, we were confident of booking orders worth Rs.1,700 crore in industrial boilers.” Against this, Cethar booked orders valued at Rs.1,000 crore last financial year.

On building a capacity of 8,000 MW, far in excess of the company’s short-term needs, Subburaj said: “We shouldn’t lose out an opportunity for want of capacity. The excess capacity enables us to make pressure parts for other boiler makers like Bharat Heavy Electricals.”

This fiscal, he said, Cethar was looking at 135 MW and 350 MW CFBC boilers. “This will prove our ability to make 500 MW boilers for power utilities.”

Cethar also plans to graduate to making super-critical boilers for power utilities, and has signed a letter of intent for building a 160 MW super critical boiler with a company he declined to name.

“Ultimately, a customer wants price advantage and I don’t see any reason why Cethar Vessels can’t compete.”

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