Delhi, India

MARKET WATCH

Delhi has long been a hub for trade routes in India, facilitating the distribution of the city's textiles and other products from its manufacturing sector.

But reflecting an overall shift in India, call centers and business process outsourcing (BPO) now rank as one of the fastest growing sectors in Delhi. According to India's software trade group Nasscom, the country's IT and BPO industry grew by 33 percent in the 2008 fiscal year, reaching $64 billion in aggregate revenue.

Delhi's gross state domestic product rose 16 percent during the past year, from INR 1.02 trillion in the 2005-2006 fiscal year to INR 1.18 trillion in 2006-2007. Per-capita income during the same period increased nearly 14 percent to INR 66,728.

Yet in the midst of this growth, Delhi's economy faces some significant challenges. Along with the rest of India, Delhi has had to contend with double-digit inflation this year.

India's IT-business process outsourcing sector grew 33 percent

Delhi wears both the positive and negative sides of fast economic growth like a reversible jacket.

The capital of India is a tech-rich symbol of economic promise, home to an IT-savvy population that has helped transform the city into an outsourcing haven for myriad multinational firms in recent years. But the fast-growing metropolis of 17 million also faces its fair share of challenges, including fallout from the global economic crisis and a troubled national infrastructure that Prime Minister Manmohan Singh estimates will cost at least $350 billion to repair.

To survive—and thrive—in this dynamic fray, project leaders will need to be armed with a keen knowledge of global project management standards as well as an ability to deftly navigate smaller budgets, shrinking talent pools and tighter deadlines.

In short, they'll need to perform like Elattuvalapil Sreedharan, Ph.D.

ON TRACK

Dr. Sreedharan has developed a reputation as something of a rock star in the local project management community. In a country where government projects often run chronically behind, he is known for his ability to bring in mega-projects ahead of schedule. As managing director of the Delhi Metro Rail Corp. (DMRC) Ltd., he led his team to close the first phase of the country's $2.3 billion train project nearly three years early.

He says it comes down to accountability.

“One of the biggest impediments to the timely completion of infrastructure projects in India today, I feel, is a lack of focus and accountability,” says Dr. Sreedharan. “Timely completion is not given the importance it deserves and projects frequently overshoot their targets, but the administrators are not held responsible.”

The Ministry of Statistics and Programme Implementation says 36 percent of government projects were behind schedule in 2007, down from 60 percent in March of 1994, the Hindustan Times reported in May.

But the cost of those holdups still equals the amount it would cost to feed half of India's population below the poverty line for four months.

Dr. Sreedharan says DMRC took a different approach to the metro project.

“The organization's mission and culture include clearly defined objectives and a vision, which was to complete the project on time and within the cost without causing inconvenience to the public,” he explains.

To ensure the support of the community, the project team has hosted more than 100 public meetings, where local residents' concerns were voiced and addressed.

And that commitment extends into the supply chain, too.

“It is also important to recognize that consultants, suppliers and contractors are very much a part of the team and deserve much of the credit for making a project succeed,” Dr. Sreedharan says. “Contractors should be treated as partners and supported with timely decisions and prompt payment.”

Transparency and meritocracy are key ingredients in Dr. Sreedharan's tonic to keep the rail project on track.

“An open, straightforward approach helps in building confidence about the organization among the outside publics,” he says. “All tenders are decided through a laid-down policy for pre-qualification and open competitive bidding.”

That means no agents or other third parties participate in the bidding process.

“Even major tenders are decided very fast, sometimes in 18 to 19 days,” says Dr. Sreedharan. “The tenders are decided purely on the basis of merit and no influence of any kind is allowed in the decision of the DMRC in settling these tenders. Therefore, to maintain transparency in all projects, it is essential to lay down the criteria for settling tenders clearly in advance. An organization should also ensure that these tenders [are] decided [on] very quickly to avoid falling prey to pressure.”

METRO MIRACLE WORKER

In India, it's not unusual for large projects to fall behind schedule, but that hasn't been the case for the $2.3 billion Delhi Metro. The first phase of the project—which covered 65 kilometers (40 miles)—finished nearly three years ahead of schedule. It was enough for Business Week to declare Elattuvalapil Sreedharan, Ph.D., the man leading the project, a “miracle worker.”

Covering more than 245 kilometers (152 miles), the project is scheduled to roll out in four phases, with the last one slated for completion in 2020. So how does Dr. Sreedharan at Delhi Metro Rail Corp. (DMRC) keep this project on track?

“Delhi Metro has tight deadlines for phase two, which is to be completed by Commonwealth Games [in 2010],” he says. “The DMRC is aiming to complete 128 kilometers [80 miles] in only three and a half years, which would be a major achievement.”

The project leveraged meticulous advance planning to minimize any changes that could slow progress. And Dr. Sreedharan relies on an almost relentless emphasis on communication.

“The contractors are updated about the plans through frequent meetings, seminars and workshops,” he says. “Frequent visits to the construction sites and guidance by the senior officers also help them.”

Street plays, exhibitions and leaflets are just a few ways the DMRC keeps the public informed about project plans and progress. One of the most important communication tools in building support are the community interaction programs (CIPs), which are open forums during which local residents discuss aspects of metro construction that may affect them. The meetings also allow representatives from resident advocacy associations, non-governmental organizations and other local groups to share suggestions, questions and grievances regarding the metro.

“These … are generally related to the metro alignment route, effects on the environment like noise and air pollution due to construction activities, cutting of trees, location, and renaming of the station,” says Dr. Sreedharan. “Most of [them] are resolved on the spot, while necessary action and remedial measure is taken on the rest.”

So far, the Delhi Metro team has organized approximately 100 CIPs throughout the region. For Dr. Sreedharan, they represent a valuable investment of time and resources. “These forums generally help in achieving support from the community and goodwill for the company.”

And at the end of the day, Dr. Sreedharan hopes the metro will help boost the local economy.

“It is a well-known fact that mobility is an important requirement for the economic growth of any urban area. Economic activities flourish in areas where accessibility is good and mobility fast,” he says. “Thus, urban transport infrastructure facilities and services are among the most important factors for the development of the urban economy.”

But that's only the beginning for project leaders tackling the mega-projects so vital to the city's economic future.

THE GOOD AND BAD

The good news for Delhi is that it's the economic backbone of India, Asia's third-largest economy and a global beacon for companies looking to outsource projects on the cheap.

The bad news is that taking the fast track to globalization and expansion has exposed the city and country to fallout from international economic turmoil. Indian business confidence ending in the September quarter sank to its lowest point in five years as the rate of inflation passed 12 percent, according to the country's National Council of Applied Economic Research.

The concern stretches into even the booming construction and IT sectors.

Kushagr Ansal, director at New Delhi-based Ansal Housing & Construction Ltd., recently told The Wall Street Journal that projects not yet marketed are being tabled or, in some cases, sold.

And Nasscom, the country's software industry trade group, reports it expects IT revenue to grow at 20 percent to 25 percent during the next few years. That's nothing to complain about these days, but it's only about half of the growth rate experienced by Indian tech companies in recent years. In July, the group's president, Som Mittal, told The Wall Street Journal, “The first round of growth is always easier. The next 10 years is going to be different.”

As India comes into its own, salary pressures are weighing on even the major outsourcing firms. In late April, IT giant Infosys Technologies Ltd. said in its U.S. Securities and Exchange Commission filing: “Wages in India are increasing at a faster rate than in the United States, which could result in increased costs for companies seeking to employ technology professionals in India, particularly project managers and other mid-level professionals.”

AS GOOD AS GOLD

Decrepit roadways are slowing down India's turbo shift to an economic superpower. So now the country is addressing its infrastructure issues through several mega-projects, including its most ambitious, the Golden Quadrilateral (GQ). Announced in 1998, the 3,633-mile (5,847-kilometer) expressway links Delhi, Mumbai, Chennai and Kolkata. The government hopes the project will give India's economy a boost by facilitating transportation between flourishing cities and struggling villages. Slated for completion in 2015, the $71 billion project is being rolled out in seven phases.

Roads have long been a widespread problem in India. “Our roads don't have a few potholes—our potholes have a few roads,” quipped then-Prime Minister Atal B. Vajpayee in the mid-1990s. And unfortunately, things haven't changed all that much since then. The nation has about 3.3 million kilometers (2.1 million miles) of roads that handle about 85 percent of passenger traffic and 70 percent of freight.

The new project has hit some roadblocks of its own, though. By the middle of 2007, the GQ was already more than two years behind schedule, according to the Economist Intelligence Unit. Much of that delay was attributed to land-acquisition problems. And in December 2007, the Indian Express reported that some 8,362 hectares (20,663 acres) needed for the project hadn't been acquired yet.

And that hasn't been the biggest pothole. Part of the GQ project entails converting roads from two lanes to four. In August, the Hindustan Times reported that of the 7,498 kilometers (4,659 miles) in the project's first phase, 443 kilometers (275 miles) had not yet been completed.

It is important to recognize that consultants, suppliers and contractors are very much a part of the team and deserve much of the credit for making a project succeed.

—Elattuvalapil Sreedharan

Delhi and the rest of the country are also facing serious competition from Latin American rivals looking to stake their claim in the outsourcing arena.

A HIGHER STANDARD

The shifting project landscape is forcing Delhi project leaders to navigate multiple minefields—talent shortages, compressed deadlines and lower budgets.

At Delhi-based project management and IT services consultancy iProzone Technology Solutions Ltd., Sushil Saxena, PMP, CEO and president, says the greatest challenge is managing project scope and client expectations.

“The initial scope and the estimation given by the salesperson is only 60 percent correct,” he says. “Due to this, the project manager has to struggle with the delivery time and quality.”

To mitigate those pressures, iProzone Solutions subdivides project scopes into smaller chunks and obtains client acceptance for each milestone after delivery.

With more than 20 years in his field, Mr. Saxena has seen some recent shifts in project managers' roles as IT becomes a larger component of projects.

“Now, the market expectation is not just for a project manager—the need is for a project manager cum technical manager,” he says, adding that the shift impacts training.

As Delhi's project leaders take on more complex projects, the need for project management knowledge and certification is gaining momentum in the corporate crowd.

“In recent years … many organizations have started taking the project management discipline seriously,” says Manisha Nigam, program manager at Freescale Semiconductor based in Noida, just outside of Delhi.

And those companies want the best and brightest. These days, the Project Management Professional (PMP^®) credential is often a requirement in current job openings.

“[There is] a lot of competition, and the biggest challenge today is to reduce the time to market,” she says. “In these scenarios, [project managers] need to have very good communication, risk management and forecasting skills, and also the ability to manage diverse teams to work towards achieving project goals.”

A 20-year veteran of India's tech sector, Manoj Gupta sees a growing awareness of the structured approach of project management. There's also an increasing desire among companies to follow global standards when working on cross-border projects.

“Some organizations have started setting up project management offices to standardize the practices, besides making a central body responsible for sharing best practices and monitoring their implementation across the organization,” says Mr. Gupta, founder of IT and project management firm Pariyojana Consulting in Delhi and executive board member of the PMI North India Chapter.

LET THE GAMES BEGIN

RENDERING OF NEW DELHI AIRPORT TERMINAL

Delhi is slated to host the Commonwealth Games in 2010, and that means a slew of visitors—and new projects.

One of the largest athletic events in the world, the competition drew about 4,500 athletes and 763,515 attendees when it was held in Melbourne, Australia in 2006.

And now, Delhi is gearing up.

The Delhi Development Authority is building a $230.7 million Games Village for athletes that will cover roughly 64 hectares (158 acres) along the east bank of the River Yamuna.

New viewing and training facilities are also on the project agenda—about INR 2,300 million worth of them, according to The Economic Times. For example, the Jawaharlal Nehru Stadium will seat 58,000 spectators for opening and closing ceremonies. Kicked off in August 2007, the project is scheduled to close January 2010.

By September, the Principal Commissioner of 2010 Commonwealth Games, Veena Ish, had begun meeting daily with her support staff in an effort to monitor progress and meet a December 2009 deadline set for many of the projects, according to The Pioneer.

The city is also undergoing some major infrastructure upgrades to accommodate the anticipated throngs of visitors.

In July, the government approved construction of a five-kilometer (three-mile) elevated road connecting the main stadium with the Games Village. With an estimated budget of INR 5 billion, the road is scheduled for completion just a few months shy of the event itself in October.

The Indira Gandhi International Airport (IGI) has a new approximately four-kilometer (nearly three-mile) runway, billed as the longest in the country. It opened to commercial operations in September but experienced a few setbacks during the first week, including faulty runway lighting and problems with the instrument-landing system, according to The Times of India. After working on the glitches, IGI commenced full 24-hour operations of the runway at the end of October.

A new airport terminal is still in progress and Parsons Brinckerhoff International Inc., the terminal's project management consultant, faces an extraordinarily tight deadline. Work on the airport began in February 2007 and needs to be completed by March 2010. To help with that race against the clock, more than 20,000 workers are living on site, according to The Economic Times.

Planning for the project reportedly took six months—about half of the typical planning time for comparable projects.

“The reason why we will be able to complete our work in the stipulated time is because all our work is happening simultaneously,” I Prabhakar Rao, CEO, airport development, told the paper. “We started construction even as planning was under way and tried to take forward all our work together. We have been able to stick to our original plans with very minor changes.”

The trends suggest future projects in Delhi will be captained by project managers up to the steep learning curve posed by the city's pending project management needs.

Dr. Sreedharan, for one, is optimistic about the next generation of project managers in Delhi and across India.

“There are many qualities in today's professionals that are admirable, especially their competitiveness, tenacity and zeal to succeed,” he says. “I believe that there are three basic qualities for a successful life: punctuality, integrity and good morals, and professional competence. The future of India will be in good hands if these qualities are assiduously nurtured by the youth of our nation.” PM