Vasanth Kumar says cheapest bid wins the deal
Vasanth Kumar is leaving the construction sector and is going to pursue a private venture in hospitality
Arabian MEP’s soon to be ex-chief executive officer, shares a couple of insights with CWQ as he moves to greener pastures.
As Vasanth Kumar leaves the construction industry and exists his key role of CEO Arabian MEP, he shares that one of the reasons for his departure is the stress of the construction industry in Qatar.
While his departure from the sector may appear sudden, Kumar explains that the exit process from Qatar’s construction arena has been under way for the past year as he has slowly eased himself out of his key position as CEO of Arabian MEP Contracting.
He explains that his vacancy will not be filled by any one person, while assuring that the company will continue uninterrupted as the executive rearranges itself around the opening: “Construction is always a team with a good leader and no-one, including me, is indispensable. I have always believed in empowering people” he says.
He says that he is now in a space where he is able to focus on other interests knowing that the company’s succession team is secure and fully competent on his departure.
“I have many things to do, I will probably be even busier – but without stress!” He explains that the construction sector has become highly stressful and the results no longer match the effort put in: “The challenges and obstacles in this present environment no longer lead to favourable results, only stress is assured,” he states.
“The players no longer trust each other in the region – it’s a dirty game, it’s a brutal game where everyone including the client loses, as decisions are based on the cheapest bid,” he says.
Kumar continues: “to get a deal just match the lowest bid, or even go below… how is this possible? This impacts on time, cost and scope/quality of work. There is no trust anymore as everyone tries to undercut the other. There is a lot of back-stabbing and 9/10 have lost money, including contractors, while suppliers might make an initial profit – but the question is, are they paid at the end of the day? They are not happy, they are also bleeding.”
He asks again: “Who is making money, the supplier, client, contractor or main contractor?”
Kumar says that the present environment is a “Breeding ground for claims, which in turn means arbitrations and ultimately a delay in payments.”
The industry needs a change of mind-set, the executive says, with more transparency and trust between the players.
Looking ahead, Kumar says that presently the market is not good for growth: “The best you can do is sustain,” he says. To mitigate the risks, the company will downsize on workload but not on people, he adds. “While it is blessed to have a good pipeline of projects for the next two years, Arabian MEP will be more selective, choosing projects on which it can deliver the results without delay and within budget. By then its hopes the market will rebound and in the interim it’s a breathing time, a time to consolidate.”
Kumar is going to pursue a (relatively stress-free) private enterprise in the hospitality sector.
He has a modest Indian vegetarian cuisine restaurant called Aryaas Restaurant, which has grown into six outlets employing 120 people, gaining recognition in Doha, winning the ‘Best vegetarian cuisine’ award, voted for by patrons.
He is presently investigating establishing two further outlets with his eye set on the region, having just returned from Abu Dhabi, with invitations to open outlets in Europe.