Disruptions in Capital Projects which are resolvable - Series 1 : Weather & Labor

Two factors I discuss today, have been discussed and talked about since decades in India, still we do not practically consider the impact of these on our large capital projects. Our in-office teams tend to be over-optimistic when planning. The reason for this overlook is that, we think we are in a technology advanced world of construction and we can easily tide over these two age-old disruptions with technology. Answer is Yes and No.

Fact is, both these issues need to mitigated by working around them and not taking them head-on. As Capital Project Advisors or PMOs, this is a vital part of our strategic advise to our clients.

Weather

Monsoon - Work is disrupted extensively, especially open field work, unless covered during this period. However advanced, our construction technologies maybe, we have to navigate around monsoons to ensure work does not suffer.

For CAPEX projects in India - We encounter two main monsoons.

Southwest Monsoon -

• Disruptions occur between June to September, with peaks in July and August.
• Key states which get affected are Gujarat, Maharashtra, Madhya Pradesh, Rajasthan, Karnataka, Kerala, Andhra, Telangana and Tamil Nadu. States in North and East India have similar disruptions
• Generally, complete loss of days is not more than 10-15 days but, during the overall season of 4 months, productivity loss is substantial.

Northeast Monsoon -

• Disruptions occur from October to December, with peaks in November and December.
• Generally, south India states, experience complete impact of northeast monsoon, especially, Tamil Nadu, Kerala and Andhra.
• Complete loss of days during this season is not more than 10 odd days but is extensive. Based on past few years of experiences, productivity loss is substantial due to rains coupled with strong winds.

Extreme Hot Summers & Cold Winters - During this time, working conditions are not favorable for labor productivity & impact concreting & other similar works which get hampered by extreme temperatures. Time constraints happen during these seasons. Impact is generally over a period of 3-4 Months in total.

Labor

General demographic source spread of labor and workforce in CAPEX projects in India is,

High Skilled Workforce - West & South India - Rajasthan, Maharashtra, Tamil Nadu

Mid & Low-skilled Workforce - North to East India - UP, Bihar, Jharkhand, Odisha

Exception is West Bengal which overlaps on High - Mid - Low Skilled Workforce

Problem related to labor and workforce is their Availability & Productivity during certain periods in India, which affect CAPEX developments.

Availability & Productivity is linked to two factors,

• Agriculture / Crop sowing & harvesting seasons in the states with good agriculture - Workforce rotates from site locations to home locations especially for ones with some agriculture income. This coincides with monsoons.
• Festivals - From August/ September to November - A part of agriculture seasons coincide with festivals hence, this is high disruption time, when mid & low skilled workforce, leaves project sites for home locations

These two factors, contribute to work disruptions from June to December i.e. 7 months, with peak of stalling around August-October i.e. 3 months.

Combined impact & need for practical planning for CAPEX in India

When you overlap these two factors , you would realize that, August and September are the worst effected and productivity and output of work progress is expected to be minimal, where work is in open and labor dependent.

It is very important for project schedulers/ planners, project leaderships, PMOs and Capital Project Strategy advisors to consider the above two factors when planning CAPEX developments in India. Especially large CAPEX which take more than a year to complete.

Considering these disruptions at sites, Industrial capex planning needs to note that,

• On site works will suffer from productivity & output loss, from June to December, if mitigations plans which are practical are not decided in advance
• Preferably, non-site works or in-office works can be planned in these months, so that on-site works start during the dry months. Especially, initial ground activities.