Larsen & Toubro
Careers at Larsen & Toubro
Mission
Larsen & Toubro’s mission is to be India’s preferred provider of equipment, services, and turnkey solutions for fossil fuel-based power plants and a leading contributor to the nation's power generation capacity.
Business segments
Larsen & Toubro is a diversified conglomerate with business interests in technology, engineering, construction, manufacturing, and financial services.
The company operates six reportable business segments: Infrastructure, Power, Metallurgical & Material Handling, Heavy Engineering, Electrical & Automation, and Others.
History
In 1934 Søren Kristian Toubro, a civil engineer at Danish firm F. L. Smidth & Co., traveled to India to oversee the construction of some factories. In 1938 his old schoolmate Henning Holck-Larsen, a chemical engineer at the same firm, arrived in the country. The two sensed that India had great potential for industrial growth. So that year, they launched Larsen & Toubro, or L&T.
L&T initially acted as a representative of dairy equipment manufacturers in Denmark, bringing their goods to India. However, the commencement of World War II in 1939 led to a restriction in Danish imports, so they were forced to open another line of business. They decided to provide equipment servicing, but eventually began manufacturing dairy equipment themselves.
The ongoing war created a need for the repairing of ships. L&T‘s experience fixing equipment made it confident taking on that task, so it founded a new firm called Hilda Ltd. for that purpose. It also began to fabricate ships. When German engineers were interned in India due to British suspicion, they were tasked with building a plant, giving L&T an opportunity to offer installation services.
In 1944 the men launched Engineering Construction & Contracts (ECC), yet another firm. After WWII, it needed money to buy war-surplus equipment, so it incorporated L&T as Larsen & Toubro Private Ltd. to raise equity capital. In 1950, the firm went public. Over the next several decades, L&T absorbed its various companies to become a multinational provider of diversified services.
Business model of Larsen & Toubro
Customer Segments
L&T has a niche market business model, with a specialized customer segment. The company targets its offerings at firms that operate in the industrial sector.
Value Proposition
L&T offers two primary value propositions: accessibility and brand/status.
The company creates accessibility by offering a wide variety of options. It is a multinational, diversified conglomerate, operating in numerous product/service categories including technology, engineering, construction, manufacturing, and financial services.
The company has established a strong brand due to its success. It is one of the five biggest fabrication companies in the world, with more than 130 subsidiaries and 15 associate firms. It bills itself as India’s largest engineering and construction company and one of its largest multinational firms. It has a sizable global footprint, maintaining offices and customers in over 30 countries, and manufacturing facilities in nine countries including India. It generated $16 billion in annual revenues in its most recent fiscal year. Lastly, it has won many honors, including the following:
- Recognition of L&T Technology Services as “Company of the Year” by IACC (2016)
- The Golden Peacock Award for Risk Management by the Institute of Directors (2015)
- The Economic Times India Manufacturing Excellence Award (2014)
- The Frost & Sullivan Excellence in Engineering Services Award (2014)
- A “Special Recognition Award“ for Most Attractive Employer in infrastructure by Randstad (2014)
Channels
L&T’s main channel is its business development team. The company promotes its offerings through its website, social media pages, advertising, and participation in conferences.
Customer Relationships
L&T’s customer relationship is primarily of a personal assistance nature. The company provides comprehensive training to customers as well as extensive phone and e-mail support.
Key Activities
L&T’s business model entails designing, developing, and manufacturing its products, as well as offering services to customers.
Key Partners
L&T maintains technology alliances (e.g., joint ventures) with various firms to provide best-in-class services for its customers. The firms represent various sectors, including Power, Construction, and Hydrocarbon. Specific partners are GULF Interstate Engineering, Chiyoda Corporation of Japan, Mitsubishi Hitachi Power Systems (MHPS), Sargent & Lundy, and Valdel.
Key Resources
L&T’s main resources are its human resources, who include the engineering employees that design, develop, and manufacture its offerings and the customer service staff members who provide support.
It maintains important physical resources in the form of manufacturing facilities in nine countries, as well as the following technology hubs that conduct process design and simulation, mechanical design, analysis of computational fluid dynamics, failure analysis and troubleshooting:
- Engineering Design & Research Centers (ERDC) in Chennai & Kolkata
- Hydrocarbon Research & Development Center in Mumbai
- Upstream Technology Center in Mumbai
- L&T Hydrocarbon Engineering Centers in Faridabad, Mumbai, Vadodara, Bengaluru, and Chennai
Cost Structure
L&T has a value-driven structure, aiming to provide a premium proposition through significant personal service and frequent product enhancements.
Its biggest cost driver is cost of goods, a variable expense. Other major drivers are in the areas of sales/marketing and administration, both fixed costs.
Revenue Streams
L&T has two revenue streams: revenues from the sales of its manufactured goods and revenues from contracts established for the provision of services.
