‘Software-as-service is best bet for infra industry’

Software rentals through subscription payment model are fast catching up among infrastructure companies for timely completion of projects with IT assistance.

Many companies are adopting this business model for cost reduction, said K Varghese Daniel, founder director and CEO of Kochi-based Wrench Solutions.

With huge debts, many companies are unable to undertake new projects and are struggling to complete existing ones. Given the situation, IT is proving to be infrastructure industry’s best bet for survival as well as growth, Daniel said.

“We are entering a new era of construction project management. Gone are the days when project management software meant CAD and MSOffice and MSProject. Today, there is software designed specifically for the full cycle of engineering, procurement and construction, which is as comprehensive as ERP, much more affordable and faster to roll out,” he said.

Wrench, he said, recently introduced a subscription payment model, which allows customers to use its software-as-a-service (SaaS). The market slowdown has forced companies to shift focus from Capex to Opex to reduce cost. SaaS enables customers to simply stop using the system if the project is discontinued.

In infrastructure industry, Daniel said, enterprise IT is seen as a large investment, forcing companies to hold back several project proposals. The subscription payment model not only brings efficiency but also avoids penalties associated with late delivery, litigation etc.

Wrench’s switchover to SaaS model signals an encouraging trend in the IT market, as it allows companies a risk-free way to leverage IT benefits even during cost-cutting phases, he added.

According to Daniel, Essar group is the first company to sign up for subscription payment model and Tata group has also shown interest, among others.

Funded by the Government of India Technology Development Board, Wrench was established in 2006 in the Cochin SEZ as a software solution provider to the construction industry. The products are being used across various verticals in 13 countries.

The company is looking at a business revenue of ₹25 crore, which is 100 per cent growth from the previous fiscal. It has six fully owned global subsidiaries and local offices across metros.