Treasury Today Country Profiles in association with Citi

Larsen & Toubro

Larsen & Toubro, Highly Commended, Judges’ Choice

Harish Barai, Larsen & Toubro

The Knowledge Centre has successfully transformed the risk management function from a compliance requirement to that of a holistic, proactive ‘value-add’ tool. As part of this initiative, over 4,000 updates have been sent in the past year to a direct audience of over 700 people involved in key decision making roles across the firm.

Photo of Harish Barai, Larsen & Toubro.

Ramaswamy Govindan

Vice President, Corporate Finance & Risk Management

Headquartered in Mumbai, Larsen & Toubro Limited is one of the largest and most respected companies in India’s private sector. With over 75 years of a strong, customer focused approach and a continuous quest for world-class quality, L&T has unmatched capabilities across technology, engineering, construction and manufacturing, and maintains a leadership in all its major lines of business.

Judges’ comments:

Although Larsen & Toubro (L&T) submitted this entry for the Best Risk Management Solution category, our judges felt this particular project warranted Highly Commended as a Judges’ Choice.

The challenge:

Ensuring that critical information reaches the right people at the right time is a key challenge in the company. Information is available in various pockets across the company but there was a need for a unified resource base.

This initiative has successfully bridged that gap to create an effective decision-making process. By interacting across businesses, this initiative provides a means to transfer project experiences in order to mitigate future risks. Over time, the depth of research has led to the creation of a repository of analyses and insights which can be used as a guide for future references.

The solution:

As part of the Corporate Finance and Risk Management function in L&T, a ‘Knowledge Centre’ has been set up to provide insights to businesses in order to facilitate decision-making. The endeavour is to offer specific, real-time and forward-looking inputs based on in-depth understanding of the business environment and competitive landscape. The solution targets the senior management including directors, business heads and strategy, finance and risk management teams.

In an organisation like L&T which is present across all continents in over ten business sectors with 65,000 employees and 100+ subsidiaries, the Knowledge Centre acts as a single-point repository that businesses can reach out to get a neutral and holistic perspective. By being a part of Corporate Finance and Risk Management, the Knowledge Centre has access to extensive research through the external network of industry experts.

As Ramaswamy Govindan, Vice President, Corporate Finance & Risk Management, L&T explains “this solution helps streamline the entire universe of research available across sources, filters them and provides specific information to suit the requirements of the business. With a dedicated team of four people to analyse economies, industries and companies, the turnaround time gets reduced drastically thereby eliminating inefficiencies.”

Best practice and innovation:

L&T’s Knowledge Centre initiative is unique as it leverages the enormous amount of information available at the Corporate Finance and Risk Management team through the network with external analysts, financial institutions, credit rating agencies and economists for the benefit of the businesses. The Knowledge Centre has successfully transformed the risk management function from a compliance requirement to that of a holistic, proactive value-added tool. As part of this initiative, over 4,000 updates have been sent in the past year to a direct audience of over 700 people involved in key decision making roles across the firm. An information repository with over 5,000 reports is ready.

“This research can be leveraged for the benefit of business divisions to make informed decisions on a variety of aspects including sector dynamics, country environment, credit options, business partner evaluation, industry best practices and potential inorganic growth through M&A,” notes Govindan.

Key benefits:

  • Productivity gains.

  • Risk removed/mitigated.

  • Enhanced business decision making.

  • Providing unbiased/independent view on businesses.