Simhadri Super Thermal Power Project (B)

Abstract

This case follows case (A) which discusses NTPC’s response to the Simhadri project that created a record of sorts in timely implementation of large projects and within a tight budget NTPC’s record of 39 months for a green-field project in India. That has taken project implementation in India to international standards. Much was at stake for NTPC. And the response of NTPC was coordinated and focused to enable it to set up the plant very quickly. Funding and project strategy, risk allocations, features contract for construction, land acquisition, mobilization of resources, technical innovations are discussed. Advance Planning, paying attention to external factors including the risks in land acquisition, planning for contingencies, strict monitoring, working with fewer packages, extensive use of IT, using incentive compatible contracts, monitoring and supervision with a motivation to solve problems, getting the government and stakeholders’ interests aligned were important to the success of the project. Rather than the result of charismatic leadership it was systems, processes, planning and incentive compabilities that drove NTPC to achieve results. High operational efficiency was achieved. As such the initiatives and strategies of NTPC can be usefully emulated by organizations having to implement projects. NTPC’s success provides a way out of the notorious delays and cost overruns that characterize public sector project implementation in India.