Goa Institute of Management

Sanquelim, Goa

M/s Talent Construction and Engineers

Organizational Behaviour Case Study

Submitted by
Group 8 Section C
RuhshaadDaroga (2010163)
Sandeep Kumar Varma Datla (2010164)
Santanu Kundu (2010165)
SaurabhSachdev (2010166)
ShashiBhushanDwivedi (2010167)
ShinamKhatri (2010168)
 TALENT CONSTRUCTION AND ENGINEERS

Abstract

M/s Talent Construction and Engineers is a partnership firm started by Mr.Upendra Kumar
Singh and his partner Mr. Dinesh Kumar Kushwaha. The firm is in the construction
business. Five years into business and the firm has already emerged as one of the fastest
growing construction companies in western India. However, the situation was very different
five years ago. Like all entrepreneurs, at the start of the venture, Mr. Singh and his partner
had to overcome many difficulties. This case deals about the difficulties they faced and how
their determination and self-belief made their venture successful. It also talks about how
positive leadership and trust are essential for an organization and how these factors helped
them to steer through difficult times during recession.

Upendra Kumar Singh was a Civil Engineer from Patna, Bihar. He was working in a private
construction firm and was performing well. He undertook various construction projects in
his tenure at that company. After a while, it became monotonous and the work did not give
him the required satisfaction. Then he decided to enter the world of entrepreneurship. Like
many entrepreneurs, it wasn’t a cake walk for him. Like any other middle class Indian
family, his family was sceptical about the prospect of starting a new construction company.
He however found support in the form of Dinesh Kumar Kushwaha, his friend from his
previous company. Dinesh had the experience of estimation and billing for construction
projects. This support from Dinesh sowed the seeds for a new partnership and it led to the
birth of ‘Talent Construction and Engineers’ with Upendra Kumar Singh and Dinesh Kumar
Kushwaha as managing partners. The company was founded in 2004 in Jamnagar, Gujarat
which now has the world’s largest crude oil refinery in terms of output.

Conditions at the time of Inception

January 26th, 2001 was the 52nd Republic Day of India. But the whole of India woke up to the
shocking news of an earth quake of magnitude between 7.6 and 8.1 on the Richter scale. The
quake killed around 20,000 people, injured another 167,000 and destroyed nearly 400,000
homes in Gujarat. There was wide spread devastation in Jamnagar, where the oil refinery of
Reliance Industries Limited, started in 1999 was situated. There was a lot of scope for
construction projects in Jamnagar and surrounding areas as part of the rebuilding process
after the earth quake. The boom in the software industry also led to increased demand for
office space and residential complexes. By 2004, Indian real estate sector entered a boom
cycle and many real estate companies like DLF, Unitech, OMAXE started lot of housing
projects and SEZs in various metros and Tier II cities like Ahmedabad, Hyderabad, Cochin,
Jaipur, etc. This was an opportunity for Talent Construction and Engineers to enter this
sector and be a part of the booming economy.
Initial Years and Progress

Upendra Kumar and Dinesh Kumar started the venture with a meagre capital amount of
thirty lakhs. Since the capital was not huge, they initially had to rely on small scale projects
like small housing complexes, shops, etc. They generated profits with these projects and that
helped them to bid for larger projects on the basis of their capital. Talent Construction and
Engineers being a small company, finding the required work force, skilled labour and
funding were the biggest challenges. Their networking with friends and colleagues from
their previous experiences and goodwill helped them get the required workforce. They were
able to source funds from banks, family and friends. In 2005, they got a major breakthrough
when they got shortlisted for the construction of a sector in RIL Jamnagar Township. It was
a 180 crore, 2 years project with a mandate to build 108 housing complexes and also the
landscaping of the area. This was their first big break and they wanted to make full use of it
by gaining experience and bidding for further such projects.

The RIL Township project was one of the flagship projects of the company. It had
demanding schedules and tough deadlines. Regular visits and meticulous inspection by
various top executives of Reliance Group including the group chairman, Mr. Mukesh
Ambani and his wife Mrs. Nita Ambani constantly kept them on their toes. The project was
very rewarding in terms of experience and gave them the much needed confidence and
platform to execute bigger projects.

As a direct consequence of implementing the RIL Township project, they could bag another
large project from the Essar Group in Jamnagar in late 2006. This time they had to do the
equipment foundation for power plants and oil refineries of the ESSAR Group and also
build an office for the Essar Group. The power plant was one of the major projects for the
ESSAR Group at that time. The picture looked rosy when the Essar project kicked off but
then it got into troubled waters.

During the Recession

The later part of 2007 and the succeeding year saw the emergence of the US subprime crisis
which changed the complete economic scenario of the world. All the interest rate sensitive
sectors took a beating as the liquidity got sucked up. This also badly affected the
construction and housing industry in the US and had ripple effects all over the world. The
Indian economy, though relatively resilient, had to face liquidity crunch. Many corporates
had to put on hold, or even scrap some projects and expansion plans due to lack of funds.
The housing prices went down by about 20 to 30 per cent in Tier I cities and about 50 to 70
per cent in the Tier II cities. Talent Construction and Engineers was no exception to this and
they faced the heat too. Essar had put on hold its Jamnagar project, the biggest project for
the company at that time and this pushed Talent Construction and Engineers into deep
trouble.

Working Conditions
Construction industry is one of the most physically and mentally demanding sector. The
workers have to live in very insanitary conditions where even the minimum requirements
for a healthy living are not met. The workers have to work whole day amidst extreme
temperatures, often sleep in make shift shelters which may not suffice to shield them from
the shivering cold or the rain. Moreover, many of them live many miles away from their
families and friends. This creates a lot of mental agony and makes them home sick. In such
testing conditions, a leader’s involvement plays a key role in motivating the workers and
drawing the best out of his team.

Mr. Singh, having worked in the construction industry for a considerable time understood
this fact and was present with his workers whenever they needed him. He has spent
sleepless nights in the chilling cold of Gujarat and has also shared the burns of the scorching
sun with his workers. His involvement automatically made the workers give their best
effort. This also made him available to the workers all the time to help them solve their
problems, be it their personal problems or be it a work related issue. The workers became
loyal to him and were always willing to put in extra effort to complete the assigned task.

Culture

The culture of the firm was very informal. The workforce belonged to diverse backgrounds,
from different parts of the country, from different religions. The workers had the freedom to
approach the employer anytime and share their problems. This really helped the team to
form a cohesive unit. The team worked as a family where everybody shared each other’s joy
and sorrow. The employer gave them enough training to maintain the standards of their
work and regular reviews were done to keep a track on the development and learning that
took place in the firm.

Coping with Recession

Recession had its impact on companies in the form of reduction in business which led to
unemployment. The business of Talent Construction and Engineers reduced because of the
stalling of various projects. The operating revenue and margins reduced by 30 to 50 per cent.
To cope with this situation, the company undertook smaller projects to keep the momentum
going and to meet the expenses.

Unlike many other companies in this sector which resorted to large scale downsizing, Talent
Construction and Engineers did not lay off its workers. Instead, they ensured that wages
were always paid on time to their workers even in this difficult hour.

“We always make it a point to pay our workers their wages on time. We can survive few days without
getting our salaries but they cannot. Too much remains at stake for them”, says Mr Upendra
Kumar.

This created enormous goodwill and trust among the employees in the organisation. This set
up a collaborative environment and the firm, along with its employees faced the recession
blues together. The crisis brought them together and every employee began to treat the firm
as his own and the overall motivation of the team grew. There was bigger sense of
responsibility among the employees which led them to put in extra efforts and meet strict
deadlines and helped them to operate efficiently in an environment offering lower margins.
The partners maintained the personal touch with their workers even though their workers
belonged to the unorganised sector where generally the employer-employee relation is
absent. Mr. Upendra Kumar Singh always used to stand for his workers before their clients
thus portraying trust and belief on his employees. This positive leadership and trust fostered
among the employees were the main pillars of this company that enabled it to stand tall
during the recession.