If we tell you a company has just seen profits up by a quarter year-on-year and turnover climbed 12 per cent, you might be forgiven for thinking said organisation operates in the booming oil sector or life peerage consulting services – areas where stellar growth is not unusual. If we reveal that the company in question works in construction, a sector in the UK economy that has not always enjoyed anything like double-digit growth, surprise may be in order.
Balfour Beatty – a firm that in March announced full order books on £7.6 billion turnover – hates surprises. Even with such knockout numbers its group CIO Ajey Sharma merely notes: “No, construction isn’t buoyant, but we do seem to be in pretty good health.”
No kidding. Still, the company is a leader in a sector notorious for its conservatism, especially in IT. “To understand construction you have to realise this is a very low-margin industry where there is a constant focus on getting return on investment,” says Sharma.
Sharma – previously a consultant with Andersen prior to its Accenture transformation in 2001 – has been leading a project to achieve just that: more ROI for the company through better use of information systems. He acknowledges that work has had to be put in to get there.
Dealing with risk
“US companies in our field tend to invest more and prefer working with ‘tier one’ IT suppliers but in this country for historical reasons we have seen more use of very small, niche players, especially in software,” he says. “That introduces risk, as this class of players can’t afford the R&D commitments or offer the longevity of bigger companies. We realised that three years ago and have been working to change our situation.”
Specifically Sharma, who reports directly to the company’s CEO, has authorised a consolidation of legacy systems onto one main ERP platform, the Oracle eBusiness Suite.
"If there’s anything we’ve learnt it’s that you need to put your best people on a project like this to make it work, even if they are the ones most valuable to the business right now"
Ajey Sharma, CIO Balfour Beatty
The company, which features in this year’s MIS 100, has invested £32 million in the move. This is driven by a desire for greater use of electronic procurement and electronic invoicing, linking to other systems including the clients’ own business software suites.
Single way forward
“We are made up of a lot of different operating companies,” he told CIO UK.
“In the past that’s meant lots of different systems that didn’t really communicate. Now we are trying to leverage that investment and look for ways information systems at the total group level can help drive the business forward.
“We are moving to a single implementation of an ERP image, and while it is too early to be specific about ROI – there are three years to go before full deployment – we are convinced there will be significant benefit to us.”
This will accrue via some flexibility on the company’s side, he adds.
“If there’s anything we’ve learnt it’s that you need to put your best people on a project like this to make it work, even if they are the ones most valuable to the business right now, which can be hard.”