The construction revolution: Prem Shanker

Ramco Industries CEO Prem Shanker has a dream. Although India is the fastest-growing economy in the world today, there are 63.7 million urban and rural households without adequate housing. India is facing a national housing crisis and Prem believes that Ramco Industries can help.

Based in Chennai with 12 plants across South Asia, Ramco Industries forms part of the US$1 billion Ramco Group, and is one of the region’s leading manufacturers of building materials, including green drywall, fibre cement boards, ceiling and non-asbestos roofing products.

The company is also considered one of the best-performing producers of fibre cement sheets, and pioneered the innovative Ramco Hilux Calcium Silicate Board, a versatile building interior product.

With more than 11 years at the helm, Prem has seen significant changes in the company and the industry during this time. "When I joined, Ramco was primarily a fibre cement roofing business, with roofing contributing 95% to the company’s revenue," remembers Prem. "We leveraged this by establishing three more roofing plants in India and Sri Lanka and increased roofing sheet volumes."

A strategic decision was made by the company at this point to diversify into other businesses. Dry construction components became a new product line and included the building whiz kid calcium silicate board, an asbestos-free versatile multi-purpose building board.

"We built a new plant in Rajasthan to focus on this and upgraded two lines in a plant in Chennai," Prem says. "We now have three lines completely dedicated to dry construction product manufacturing.

"Last year was our highest earning year ever thanks to expansion in the existing business and diversification into the new lines. In fact, today roofing contributes approximately 70% of the business with increased revenue now coming from our new products."

One of the key factors for the growing success of the business has been the company’s innovative approach to automating the production cycle and process chain. "We have a unique electronic workflow process that is mobile enabled," Prem states.

"All 14 of the company’s operating lines across almost every major state in India and Sri Lanka are now digitised. Workflow digitisation is the company’s backbone and is what differentiates us in the market. At every stage in the manufacturing, accounting and sales processes there is an extensive electronic workflow with integrated data analytics.

"This embedded analytics is a huge differentiator for us," he adds. "At any relevant data point during a purchase order, it’s possible to check the details and status of it online via mobile phone. Behind the electronic workflow is a backend of data and metrics that can be tracked to improve our processes.

"Building products are basically commodities with little differentiation between manufacturers," suggests Prem. "Ramco’s innovative electronic processes make us stand out. It’s not the product that’s different but rather the way we make it, sell it, and how we work together that makes the difference."

"It’s not the product that’s different but rather the way we make it, sell it and how we work together that makes the difference."

With its supply chain management, the unique electronic backend creates a point of difference for Ramco Industries’ strategic supplier relationships. "With our electronic interface we remove the operational hurdles that a vendor would normally face," Prem remarks.

"We’ve embedded our vendors into our electronic data chain – they can see our quality and R&D expectations and address them immediately. This helps improve their performance and strengthens our relationships."

The strength of the supplier partnerships goes both ways, with Ramco Industries enjoying advantages as well. "We’re loyal, we sign long-term fulfilment agreements and at least half the time, we’ll receive the lowest prices in the market. But more importantly, our suppliers will work with us on our product development or quality requirements," he adds. "We work together to improve the items being purchased."

Ramco Smartbuild Tech Services is a further innovation by the company offering 360-degree support and turnkey services for drywall construction. This includes design, material consultancy, project execution for the dry construction components of a building and site quality assurance.

Altair, Colombo’s tallest and most iconic residential tower, features Ramco Smartbuild dry construction products on all interiors, walls, partitioning and ceilings throughout.

Flatpack homes, movable homes, modular homes, kit homes – all go by a number of different names, but the premise is the same – as is the direction that Prem wants Ramco Industries to head.

"We want to be the manufacturer that creates factory-engineered buildings and building components," says Prem. "Assembly line construction is such an advantage in rural areas where there may be limited skills, raw materials and often a difficult terrain to build on. It’s very difficult to construct everything onsite.

"If our buildings are 80% completed by the time they leave the factory, this reduces how much needs to be done on site, which makes the construction process easier and faster," he adds. "We feel this construction method and opportunity has significant potential.

"Eventually, we’ll ship a house in a crate with a screwdriver and 20 days later, it’s built," laughs Prem. "While this is where the company is heading, it will never be as simple as this because product quality is paramount, as is the infrastructure to support it.

"Eventually, we’ll ship a house in a crate with a screwdriver and 20 days later, it’s built."

"Changing mindsets is also a challenge in India, Sri Lanka and Nepal, where many believe traditionally constructed housing with solid brick walls is the only solution. We need to help them understand the performance benefits of engineered building materials.

"Although many engineering concepts still need to be translated into factory-manufacturable processes and a vast range of engineered building components are required, factory-engineered homes could be an answer to India’s housing shortage.

"If we’re able to address even a fraction of the problem with quality, energy-efficient, factory-engineered dwellings, this fits with Ramco’s philosophy of social responsibility and community care."

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