A consulting solution for a manufacturing giant which has been facing problems from government ban on imports of steel and local resistance to new projects on lands used by villagers. An integrated gamification strategy based on behavioral analytics and international trade arenas.

1. Team Trinity
Disclaimer : Primary & Secondary research information has been used to validate the solutions in the case. All the recommendations related to the business
problems, as mentioned in the case, has been given by Team Trinity Student research
OutThink Case Study Challenge | 2018
Brook & Calder is contracting firm in Water Supply and distribution segment in India and Is facing difficulties
in its recent project in Rajasthan. We are recommending a digitally disruptive and lean strategy for its
operations. For its procurement we have outlined a comprehensive unified framework for low-cost sourcing
strategy.
Formulating an Integrated Gamification
Strategy for B&C in Mahatma Gandhi
Rural Water Supply Project
IIM Rohtak

2. Executive Summary
Analysis of associated risk & benefits reveals that
regulatory, social and operational risks can be
managed by professional risk management process
and the project is attractive enough to bid for. Also,
being funded by an international agency,
procurement terms, dispute settlements, payment
and tax considerations should be checked carefully
and followed properly.
Analysis of three packages on various parameters
like performance, stability, capability indicates that
if B&C is allowed to Bid for only two packages, it
should go with Bikaner and Nagaur.
Importing from MFN can reduce procurement cost
by a considerable amount. taking support from
other verticals like R&D, It, Control will help in
dealing with the changed scenario just before the
bid.
To fulfill the requirement of In-House O&M
capability, B&C can go for either acquisition or
build it from scratch. Our Analysis suggest that it
should develop O&M capabilities in-house which
will offer customized solution
1
2
3
4
5
6
7
Risk Benefit
Analysis
International
Funding
Considerations
Modifications
Contract
Conditions
Changing
Scenario
Lower ground
level
Withdrawn tax
benefits
Innovations
Possible
Price Signaling
Price Leadership
Overhead margin reduction
Imports under MFN
Package
selection
On- time
completion
In-House O&M
capability
Local Mafia Issue
Procurement
Make In India Constraints
Increased excavation
burden
Collaboration
Modification
Alternative
Material
Import from
MFN
Proposed Decision enforcement plan
Action
Plan
Political Risk insurance
Leverage technology
Import from MFN
Sourcing from SEZ in
Custom duties
exempted states
2

3. Risk/Risk Legal Risk Labor Risk
Operational
Risk
Maintenance
risk
FinancialRisk
Code
s
L1 L2 La1 La2 La3 O1 O2 M1 M2 F1 F2
LegalRisk
L1
L2
-
0.8
0.8
-
0
0
0.2
0.2
0
0
0.2
0
0.2
0
0.2
0.2
0.2
0.2
0
0
0
0
LaborRisk
La1 0 0 - 0.8 0.8 0.6 0.4 0.4 0 0 0
La2 0.2 0.2 0.8 - 0.9 0.4 0.2 0.6 0 0 0
La3 0 0 0.8 0.9 - 0.8 0.2 0.8 0 0 0
Operational
Risk
O1
O2
0.2
0.2
0
0
0.6
0.4
0.4
0.2
0.8
0.2
-
0
0
-
0.8
0.2
0
0
0
0
0
0
Maintenance
risk
M1 0.2 0.2 0.4 0.6 0.8 0.8 0.2 - 0.6 0 0
M2 0.2 0.2 0 0 0 0 0 0.6 - 0.6 0.6
FinancialRisk
F1
F2
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0.6
0.6
-
0.8
0.8
-
Co-relational between various factors & Risk are made to improve shortcomings
L1
Procurement
of NOCs
L2
Land
Approvals
La1
Wages and
Productivity of
theWorkers
La2
Contractual
Laws
La3
Strikes and
Workers’
UnionPower
O1 Safety Risk
O2
Inventory and
SystemRisk
M1
Health
Standards
M2
Tenant Rates
and Laws
F1
Debt and
Interest Rate
Risk
F2
Capitalization
Rate Risk
Specific initiatives to improve risk culture of B&C
Internal Competencies not adapted
to changing external factors
Professional risk management
significantly improve results in
public procurement processes
Existing Proposed
Social
Other
Operational
Opportunities
Opportunity to show operational prowess
(5500 ML RWR)
Will enhance the O&M capabilities
Opportunity to focus on increasing
overhead costs
Will improve the social image of the
company
Will prove to be a competitive advantage
over Hydrogiants
Will make it easier to take other
government projects
The benefits of the package are many, which
exhibit the bright future scope for the company.
The imminent risks can be mitigated with efficient
and prudent management. Hence, we
recommend the company t go ahead with the bid.
3

4. Strategy for combating International Bidding Considerations and Changes
prior to Financial Bid
Concerns for internationally
funded project
Procedure for
product
modification
Obvious change
in appearance of
the building or
facilities
Change of
project
Sites
Change of
major
structure
Strength
of the
building
or
facilities
Change of
dimensions of the
building or
facilities or
change on weight
of the vessels
Change in
quality or
quantity of
major
equipment
Change
that
requires
amendmen
t of verified
contract
Other changes
for which the
funding
agency deems
the reporting
necessary
Type of
Contract
Contract
Price
Size of
contract
Conditions of
contract
Terms of
payment /
Payment Method
Settlement
of Disputes
Force
Majeure
Warrantie
s
Performance
Bond or
Guarantee
Specifications /
Standards
Procurement
Consideratio
ns
Tax
Considerations
Scope of
work
Period of
executio
n
Obligatio
n of
parties
C
O
N
T
R
A
C
T
Changing ScenarioI n c r e a s e d
e x c a v a t i o n
b u r d e n
C h a n g i n g
R e g u l a t o r y
f a c t o r s
Collaborate with other verticals- IT
Automation using technology would
help in reducing the cost
Modifying the terms of contract
Resetting the FSL of RWR and modify
the other terms of contract
Searching for alternative materials
Using other materialsmethods to
employ balanced excavation work
Import from ASEAN nations- MFN
status
Import from Indonesia/Cambodia with
negligible import duties
Search for cheaper domestic
alternatives
MS producers are to be found in
nearby regions to satisfy the project
demandModifying the terms of contract
The effect of changes on cost/
deadlines is to be taken into account in
modified contract
Countries chosen with MFN and Import treaties for
Steel which are exempted from Custom Duties
4

5. B&C’s Cost & Integrated Risk Prediction based package decision framework
Climate change
concerns
-
-
-
-
-
-
Uncertainty
government
policy
Worsening
fiscal terms
Access to reserves:
political constraints
& competition from
other bidders
Competition from
new technologies
Cost containment
Firm risks
Human
Capital
deficitNew
Operational
challenges
Price Volatility
Risk based package selection
framework
Internal
Control
Strategies
 Operational Excellence
 Alliances
 Cost optimizations
 Improved Client Intimacy
 Compliance with Standards
-More Same Less
Selection Criteria Package I Package II Package III
Performance
Stability
Compliance
Capability
Improvement
Conclusion
Project cost is 441 crores
- Covers 2 towns and 200 villages
Project cost is 573 crores
- Covers 3 towns and 312
villages
Project cost is 605 crores
- Covers 7 towns and 413
villages
- Regulatory approvals might take
time to resolve, hence Nagaur and
Bikaner packages are better as
compared to that of Charu
In Charu package, the DI
pipeline quantity may be
increased by 20%
Digitalization a competitive
advantage with company- helps
in stability of packages
Design & Build requirements
show that Nagaur and Bikaner
packages are better
Political influences in Charu might
delay the implementation of
projects
MS pipeline requirement in 3
packages might delay the
implementation
Company would be able to exhibit
their capability in the Nagaur and
Bikaner projects in a better way
Company would look to
minimize its O&M exposure, so
Nagaur & Charu packages are
better as compared to Bikaner
Improve processes with
better and more competitive
products and services as the
end result
Company with its capabilities of
technology adoption and
digitalization would be able to
improve it product and service
offerings In all 3 packages
We think company is better
able to improve in less risky
packages, and in those ones
in which company has a
competitive advantage
Organization's ability to produce
products and deliver services
according to plan
Nagaur- Lowest project
cost; Lesser O&M
exposure;
Bikaner- Technology adoption
rate is
high; Regulatory requirements
is less;
Charu- O&M requirement is
less; DI
pipeline quantity might
increase
We propose the company to go with NAGAUR and BIKANER packages
5

6. Innovations for Bid dominance against Hydrogiants
Strategy for
Deterring
Lowering of
Rivals Bid
Cost
Reduction
Price Cutting
Leveraging
Past Industry
Expertise
Strategy to
manage
Rivalry
Price
Signaling
Price
Leadership
Overhead
margin
reduction
Imports
under MFN
Primary considerations for clearing financial bid rounds
Margin dominated considerations
Overhead cost increases
Custom Duties tariff
impositions
B&C has faced significant challenges in maintaining the cost under bidding when quoting for
the final bids under consideration. This has resulted in the loss of bids in the past bids against
Hydrogiants. We propose a dual integrated strategy of MFN procurement & Internal cost
reductions
5 Pronged strategy for internal cost reduction through PT Architecture
In order to win the
Financial bid , B&C needs
to engage & tap into it’s
dynamic digitalization
capabilities for cheaper
sourcing costs.
In our model, we
propose that B&C
involved obtain and
ongoing company
purchasing restructuring
efforts in order to
mitigate differing site
conditions
DSC Mitigation Strategy for B&C
Bottom-up Cost saving
ideas and continuous
improvements will lead to
incremental savings and
not step- change savings
6

7. B&C’s Integrated Strategy resolution for On-Time delivery in the face of DSC
L o c a l M a f i a
I s s u e s
The main risk involved here is that the area
under project consideration is subjected to
local mafia & political groups corruption
practices which might affect project completion
timeline.
Our recommendation is implement political risk
insurance offerings. Leveraging such contracts
through Central government body in talks with
IFA will help B&C to overcome corruption.
In the long run, it offers scope of leveraging
debt issue for changing project costs too
M a k e i n I n d i a
R e g u l a t i o n
C o n s t r a i n t s
Due to the increase in the Government of
India’s insistence of procuring materials used
for the project from Indian Suppliers in line
with the Make in India program, B&C is facing
significant increase in projected cost
escalation due to the local materials.
Although GST has paved way for significant
improvements in Cross-State taxes, we can
still squeeze extra margins to accommodate
government’s interests.
• Sourcing Materials from SEZ in Custom
duties exempted states
I n c r e a s e d
e x c a v a t i o n
b u r d e n
With the Site condition different from the considered
one when B&C initially opted for the Project significant
additional needs to be worked out.
• Leverage technology from existing verticals
Strategic risk measures affecting project completion timeline
H1
H2
H3
H4
3
2
4
3
H1
H2
H3
H4
B7C’s Risk Impact
Matrix
- Impact of risks on
B&C’s operation
1- Good, 5 - Bad
The impact of risk on B&C’s operations timeline should be mitigated by implementing the following measures
Changing Regulatory factors
& procurement costs
7

8. Ensuring Profitability during Operations & In-house O&M Capabilities buildup
Requirement of O&M in-house Capability
B&C doesn’t have O&M in-house Capability
Requirement Challenge
The following were the activities which B&C must ensure that it has acquired competence on when
quoting for the bid. Operations including Intake, raw water reservoir, water treatment plant, clear
water reservoirs, pump houses and pipeline work.
O&M
facilities
consideration
s for In-
House
development
O & M P R O C E S S M A P F O R B & C Every lean plant-level organization
must be supported by highly
specialized external services. Yet
this, by its very nature, leads to
deteriorating internal know-how.
And it is often difficult to control
the quality and price of
specialized external resources,
who, if not accessible around the
clock, put the availability of the
entire plant at risk.
Therefore, pooling valuable and
highly specialized internal O&M
resources into a central
organization is vital for utilities
with a generation fleet—not only
for sharing resources, but also for
transferring knowledge and
experience across all plants.
I n - H o u s e C a p a b i l i t i e s v e r s u s E c o n o m i e s
o f s c a l e Set the O&M direction. All
successful strategies begin with a
foundation that has room for further
development. Key decisions are
made at this point, including
determining the degree of in-house
capabilities that will be necessary
and gauging the impact O&M has on
company performance
Gain a maintenance-specific view.
Best-in-class maintenance strategies
are always consistent across both the
system and subsystem levels
Develop an outsourcing and make-
or-buy Strategy. This step is the first
examination of the strategic
relevance of O&M processes and the
feasibility of outsourcing, defining the
optimal split between in-house and
external services and capabilities
Thank You For This Wonderful Opportunity! 8