CHAPTER 1 INTRODUCTION

1.1

OVERVIEW OF THE INDUSTRY

Steel is the backbone of all industrial and commercial activities. Realizing this, computers planners have been formulating and updating annual plans for production of iron and steel .it is in this context that a number of steel plans were set up, are still being set up and the production capacities of the existing ones being expended. Bokaro Steel lant !BS " was the fourth in the row to be set up in public sector. #onsidering the huge investment in this venture, it was considered worthwhile to stud$ its economic aspects including the benefits that have since accrued out of these. %hile S&'( and )ata Steel were the main producers, the latter being the onl$ private pla$er. 'n 1**+, the 'ndian steel 'ndustr$ had a production capacit$ of ,- .). 1**, saw the onset of liberalization and the 'ndian econom$ was opened to the world. 'ndian steel sector also witnessed the entr$ of several domestic private pla$ers and large private investments flowed into the sector to add fresh capacities. %ith a current capacit$ of -/ .) the 'ndian Steel 'ndustr$ is toda$ the 0th largest producer of steel in the world. )oda$, 'ndia produces international standard steel of almost all grades1varieties and has been a net exporter for the past few $ears, underlining the growing acceptabilit$ of its products in the global market. Steel is a highl$ capital intensive industr$ and c$clical in nature. 'ts growth is intertwined with the growth of the econom$ at large, and in particular the steel consuming industries such as manufacturing, housing and infrastructure. Steel, given its backward and forward linkages, has a large multiplier effect. %ith capital investments of over Rs 1++, +++ crores, the 'ndian steel industr$ currentl$ provides direct1indirect emplo$ment to over , million people. &s 'ndia moves ahead in the new millennium, the steel industr$ will pla$ a critical role in transforming 'ndia into an economic superpower.

IRON AND STEEL INDUSTRY: AN OVERVIEW

'n the world as a whole, iron and steel industr$ has witnessed rapid growth during last 1++ $ears. 'n 102+the world steel production was merel$ 1+ million tones !mt" which increased threefold to ,0 mt in 1*++ and over sevenfold to 2-mt in 1*,+.)herafter in the next 3+ $ears, the production increased about tenfold 212 mt in 1*0+4 highest production ,

of 252mt was achieved in 1*2*.6ue to recession, the demand of steel went down after 1*2*, particularl$ in technologicall$ advanced countries. )hough it has been steadil$ increasing since 1*0-, the production of steel has been regulated to suit the demand levels. )he last decade saw the 'ndian steel industr$ integrating with the global econom$ and evolving considerabl$ to adopt world7class production technolog$ to produce high 8ualit$ steel. )he total investment in the 'ndian steel since 1**+ is over Rs 1*,+++ crores mostl$ in plant e8uipments, which have been installed after 1**+. )he steel industr$ also went through a turbulent phase between 1**2 and ,++1 when there was a downturn in the global steel industr$. )he progress of the industr$ in terms of capacit$ additions, production, consumption, exports and profitabilit$ plateaued off during this phase. But the industr$ weathered the storm onl$ to recover in ,++, and is beginning to get back on its feet given the strong domestic economic growth and revival of demand in global markets. 'n the world toda$ new technologies continue to be ushered in to achieve further conversation of materials and energ$ to meet the diversified demand of better steel 8ualities, to exercise better process control, to preserve the environment, to remain competitive in costs and, in short, to cater to the challenging conditions of the world in progress. &part from the spirit of innovation and mankinds constant endeavor to excel challenges offered b$ the changes in situations motivate the human efforts towards the technolog$ development. & look at the world steel production shows as if it has reached its zenith. &lthough the picture ma$ be so for the developed countries. %hile the consumption of the steel is stagnating in most of the developed countries, it is not the same for developing countries. %hile the consumption of steel is stagnating in most of developed countries, there has been continuing growth in steel consumption in developing countries. )he per capita consumption of steel b$ the steel countries range between -/+ kg and 2++ kg4 but, on the other hand, the developing countries, with the exception of a few, consume less than /+ kg per head !&s in 1**+s". 't is, therefore, anticipated that with the passage of time, the

steel consumption of the developing countries will increase to facilitate much needed industrial and economical development of these countries.

ANALYSIS OF STEEL ACROSS THE GLOBE

)he declining price trend after an unprecedented rise in 91 of ,++/ has taken sheen off the global steel market. :owever, there is a widespread perception that in the post 9, of the current $ear the global price are bound to go up. ;nl$ this time the rise would be flattened and not abnormal. )he domestic demand in <urope is steel low with industries production showing a downward trend forcing the ma=or steel producer to call back the price hike announced earlier. )he postponement of purchase b$ the bu$ers is likel$ to result in running down the current inventories. 6ata released recentl$ indicate that <> has imported a total of ,,.0 million tones including semis4 which have gone up b$ 0 percent in ,++5.)he import of #R coil and coated coils were also higher than last $ear <> exports totaled ,5/ million tones in ,++5. &rea rod in ?an7.ar ,++/ !million tones" <> !,/" ;ther <urope #'S B &merica S &merica &frica .iddle <ast &sia1;ceaniaC #hina %orld C<xcluding china Table 1 52.*3 3.0,2.3, -,.5, 11.,1 5.-5 -./0 //.53 22.2* ,32.,1 rod in ?an7.ar ,++5 !million tones" 50.13.*5 ,2.32 -,.-, 11.10 -.*1 -.,2 /5.// 3,.0, ,/+.2* 7+.71.3 7+., +.+.1+.0 *.5 1.2 ,-.0 3./ @ Arowth

300 250 200 150 100 50 0 production in =an7march ,++/!million tones"

EU 25 other europe cis north america south america africa middle east asia"oceania china world

production in =an7march ,++5!million tones"

<> ,/ other europe cis north america south america africa middle east asia1oceania china world

% growth -0.3 -1.6 -0.2 0.3 0.3 10.8 .! 1.# 23.8 6.5

Table 2

-+ ,/ ,+ 1/ 1+.0 1+ / + 7+.7/ 71.3 7+., +.+.@ growth *.5 3./ 1.2 ,-.0 <> ,/ other europe cis north america south america africa middle east asia1oceania china world

Dlat price have fallen in Borth &merican market b$ E2+70+ per ton in the last two month. )he current :R coil price b$ >S mills is pegged at E31/ fob1t with #R price at E3*/ per ton. #ompared to flat producer the long product market is relativel$ stable and there is no decline in the price of structural more due to fall in import volumes. #hina has also remove a 1- percent rebate on steel billet and slab exporter with effect from 1st &pril ,++/ to enhance domestic availabilit$ this has led to price fall in &pril. )he export rebate on bars and rods has been reduced from 1- to 1+ percent from 1st .a$. 'ndian long product market is largel$ influenced b$ global price of semis. )he #'S price of billets is currentl$ running at E-2+gob1t4 which is nearl$ at the same level as in .arch. )here are reports that Russian steel producer are expending a ma=or chunk of the e8uit$ participation in mills in other countries as a long term trading ventures. #rude steel production figure for ,++/ released b$ :'S exhibits a growth of 3./ percent in the first three month over the corresponding period in previous $ear. #hina remains the leading steel producer with growth touching ,5 percent.

1.2

PROFILE OF THE ORGANIZATION

;ne of the leading steel producer of in the world and the largest steel maker of the countr$. S&'( occupies a prime place in the industrial scenario of 'ndia. S&'(, is 'ndias largest and one of the %orlds leading steel producer with a turnover of around Rs.13/++ crores. 9ualit$ steel products from S&S'(, have carved a niche for themselves in the global steel market. )he compan$ aims at making its global presence felt through export, =oint ventures and alliance with internationall$ reputed steel markets. 'n a fast changing product market scenario, S&'( has lunched a new strateg$ for achieving a turnaround, which includes financial restructuring and business restructuring to focus on core business of making carbon steel and withdrawing from non7core and non7viable activities. .aking emplo$ees focus on market re8uirement, ensuring greater involvement of plans in marketing initiative, achieving cost leadership through rigorous cost cutting drive and rationalizing manpower to bring down the total number of emplo$ees to competitive levels are some other facets of the strateg$.

'n the new millennium, there is a strong focus on S&'(s business activities for customer satisfaction, adopting an approach for increased s$nerg$ between production capabilities and market needs and ensuring suppl$ of customized products with shorter lead times. 2

S&'( has been progressivel$ investing in technological up gradation of its plants and facilities for supporting costs reduction, improving product 8ualit$ and $ields, and for environmental protection. 'n the new millennium, the accent of S&'( has been to accelerated the process of change, adapt to emerging competitive business environment and excel as a business organization both within and outside 'ndia.

VISION OF SAIL
)o be a respected world #lass #orporation and the leader in 'ndian steel business in 8ualit$, productivit$, profitabilit$ and customer satisfaction.

MISSION OF SAIL
%e build lasting relationships with customers based on trust and mutual benefit. %e uphold highest ethical standards in conduct of our business. %e create and nurture a culture that supports flexibilit$, learning and is proactive to change. %e chart a challenging career for emplo$ees with opportunities for advancement and rewards. %e value the opportunit$ and responsibilit$ to make a meaningful difference in peoples lives.

BO ARO STEEL PLANT AT A GLANCE

DEVLOPMENT OF BO ARO STEEL PLANT
'n September 1*// the Aovt. of 'ndia decided to develop the Bokaro site for a steel plant. &ccordingl$, an initial provision of Rs. -.2/ cr. %as made and :industan Steel (imited !:S(" was asked to take up the preliminar$ work. :S( appointed ..B.6astur F#o., the consultants, for carr$ing out the feasibilit$ stud$. )he feasibilit$ report, submitted in

6ecember 1*/*, recommended establishment of a , million7tone plant, which was accepted. ..B.6astur F #o. was then commissioned to prepare a 6etailed ro=ect Report !6 R" in .a$ 1*3,. )he 6 R envisaged 1./ mt. lants in stage 1st and 5 mt. lants in stage ,nd. &gain, on the basis of 6 R, :industan Steel %orks #onstruction (imited were appointed as civil contractors to undertake the site work. 'n order to arrange external started finance, negotiations Aovernment of 'ndia with government of >S&. &ccordingl$, it was agreed in ?anuar$ 1*3, that techno7 surve$ economic

would be made b$ >S Aovt. &genc$ for 'nternational 6evelopment !>S &'6". )he report, submitted in 6ecember 1*3, b$ >S Steel #orporation, who was appointed b$ >S& to conduct the surve$, envisaged a 1.57mt steel plant, increasing its capacit$ to 5 mt over of 1+ $ears. :owever, there was sharp resistance in &ugust 1*3- for providing assistance to state aided pro=ect in 'ndia and that ended the scope for &merican finance. & global 8uest for financial aid b$ an$ other countr$ was started which ultimatel$ culminated in the >SSR agreeing to finance the pro=ect. &n agreement was signed with the Soviets on ,/ ?anuar$ 1*3/ for rendering financial assistance and technical collaboration for establishment of Bokaro Steel lant. 'n pursuance to this agreement G1o )iazpromexport, .oscow, prepared a 6 R for the diverse aspect of works at Bokaro between 1*3/ and 1*3*. Bokaro Steel lant was originall$ incorporated as a limited compan$ in ?an. 1*35. But, after the information of Sail in 1*2-,m it become the wholl$ owned subsidiar$ of S&'( in terms of public Sectors 'ron and Steel companies !Restricting and .iscellaneous rovisions &ct, 1*20". )he lant was conceived as the countr$s first S%&6<S:' steel plant with build with maximum indigenization going into the going into the e8uipments, .aterials and Hnow *

how. )hus, this pro=ect has been a radiant shift from the earlier dependence on foreign sources for know7how and consultanc$, design, and e8uipment, supervision, erection, etc. to almost a full measure of self7reliance. 'ts first of 1.2 million ton ingot steel commenced on ,nd ;ctober. 1*2, with the commissioning of the third blast furnace. <xcept for minor units in cold Rolling mills, all units of 5 million7tons stages have alread$ been commissioned as on date. )he lant is designed to produce flat products like :ot Rolled coils, :ot Rolled lates, :ot Rolled Sheets, #old Rolled coils, #old Rolled Sheets, Aalvanized ! lain F #orrugated" Sheets and )in .ill Black lates (inked with ma=or raw materials sources, the suppl$ of 'ron ;re and fluxes is ensured from the captive mines of S&'( situated at Hiriburu, .eghataburu, Bhawanathpur and Huteshwar. Some more leasehold for limestone1dolomite is being developed for meeting the future re8uirements. %ashed coal supplied from different washeries at 6ugdha, Hathara, and Aiddi, <)#. and raw coals obtained from =haria coalfield. )hus, most of the coal re8uirements are met from nearb$ sources making Bokaro a coal7based steel plant.

ANNUAL RAW MATETIAL CONSUMPTION OF BO ARO STEEL PLANT

Raw material (ump 'ron ;re 'ron ;re fines (imestone for sinter plant (imestone for lime F dolomite shop .anganese ;re 6olomite for lime F dolomite shop 9uartizite #oking #oal Derro &llo$s Bauxite 9uartzite sand for foundries .audling cla$s .uddling for thermal power plant Table 2 #onsumption in 1./.) stage 1,5+ ,*-+ 110/ 5515+ /2 *+ --55 15.0 12 1,.5 /.0 ,-1 )housand tones 5.+ .) stage ,135 /-*1*+3 1+32 ,/3 1-* 15+ //2-5.0 5+ ,* * -2,

1+

PRICING POLICY
Bokaro Steel lant is one of the largest integrated steel plants in &sia. BS( mainl$

produces :ot rolled sheets, cold rolled sheets, galvanized sheets, corrugated sheets etc. but in the production of these items, man$ valuable b$ products are generated. 'n order to maximize sale revenue and cut down the cost of main products, these b$ products are sold, but these b$ products being of high market value need special efforts and procedure for selling. :ere the marketing department of BS( pla$s a ma=or role. )hese b$ products generated in the process of converting coal to coke though of ver$ high market value cannot compete with similar petroleum products in term of 8ualit$. &s a b$ product selling compan$ cannot become a market leader in those products when there is the presence of large units selling similar products as their main product so BS( cannot become market leader. BS( is not market leader in the field so its prices mainl$ depend upon the prices set b$ market leaders. BS( follows the prices set b$ the market leaders though there is other factors also which pla$ a vital part in price determination. )hese factors are 6ispatches of last three months. !a" 6emand !b" Stock in hand Besides these factors the market forces decide the price and marketing department meet those prices. )he main ob=ective of the pricing polic$ of BS( is maximization of sales revenue. )he ob=ective is fulfilled b$ either increasing the prices when the demand is high or decreasing the prices when demand is low or giving some turn over discount on its products. )he pricing committee takes all decisions relating to pricing policies.

DISCOUNT POLICY
Aenerall$ no discount is offered but in some cases when bulk sale and 8uick disposal is given preference then discount is offered. #urrentl$ onl$ on ammonium sulphate discount

11

is offered. )hese discounts are termed as )urn over discount !);6". ;n ammonium sulphate the discount is as follows 1+++ to 1/++ metric tone I Rs. ,++ per metric ton. J1/++ metric ton I Rs. -/+ per metric ton )he revenue maximization team reviews the decision related to pricing policies periodicall$. Revenue .aximization team meets once in a month and decides upon the various pricing criteria of different products of respective steel plants. 't pla$s a ma=or role in price fixation of different products.

CURRENT SCENARIO
)he 'ndian steel industr$ also went through an extremel$ turbulent phase in the backdrop of a global economic slowdown revealing that the industr$ was now globall$ linked and was impacted b$ developments in international markets. &s per the Binth lan !1**27 ,++," steel production targets the industr$ had started investing in fresh capacit$. %hile the installed capacit$ of the industr$ went up to -/ .), a slowdown in almost all industrial segments of the 'ndian <conom$ and depressed global demand resulted in mismatch between installed capacit$ and demand. )his led to a crash in steel prices, which meant ever7decreasing price realization for all ma=or steel producers. &ll ma=or producers barring )ata Steel went into red and in 1***7,+++ 8uestions were being asked whether the steel industr$ would surivive. Dig 1. shows that the profitabilit$ of the 'ndian Steel 'ndustr$ had eroded considerabl$ during this phase. Dig. , shows the Return on Bet %orth of 'ndian steel companies during this tough phase.

1,

1.!

PROBLEMS OF THE COMPANY

't has to create credibilit$ in the public. 't has to compete with the wide range of products that its competitors offer. 't has to decide on the strategies to be adopted which will help to counter competition. 't has to increase its no. of offices and also enhance its network of agents so that it can compete with other companies. 't has to focus on providing effective training to its emplo$ees so that the customer base can be increased and moreover customer satisfaction can be ensured.

1."

C#$%e&'&#() A*al+)')

Ta&a S&eel )ata Steel !earlier known as )ata 'ron F Steel #ompan$ or )isco" represents the countr$s single largest, integrated steel plant in the private sector. )he compan$ has a wide product portfolio, which includes flat and long steel, tubes, bearings, ferro7allo$s and minerals as well as cargo handling services. %hile in terms of size, )ata Steel ranks -5th in the world4 it was ranked first !for the second time" among ,- world class steel companies b$ %orld Steel 6$namics in ?une ,++/. Recent overseas ac8uisitions are )ata Steel bu$ing &nglo76utch firm #orus for over 1, billion dollars %ith its plant located in ?amshedpur !?harkhand" and captive iron ore mines and collieries in the vicinit$, )ata Steel en=o$s a distinct competitive advantage. )he main plant at ?amshedpur manufactures / .) & of flat and long products, while its recentl$ ac8uired Singapore7based compan$, BatSteel &sia, manufactures , .) & of steel across Singapore, #hina, hilippines, .ala$sia and Gietnam. #orporate #atal$st 'ndia & report on 'ndian 'ron and Steel 'ndustr$ S&eel A,&-#('&+ #. I*/'a L'$'&e/ 0SAIL1

1-

Steel &uthorit$ of 'ndia (imited !S&'(" is a leading ublic Sector >ndertaking ! S>" in which the Aovernment of 'ndia owns about 03 per cent of e8uit$. 't is a full$ integrated iron and steel maker, producing both basic and special steels for domestic construction, engineering, power, railwa$, automotive and defence industries and for sale in export markets. 't is ranked amongst the top ten public sector companies in 'ndia in terms of turnover. )he$ manufactures and sells a broad range of steel products, including hot and cold rolled sheets and coils, galvanised sheets, electrical sheets, structurals, railwa$ products, plates, bars and rods, stainless steel and other allo$ steels. S&'( have five integrated plants and three special steel plants, located principall$ in the eastern and central regions of 'ndia and situated close to domestic sources of raw materials, including the #ompan$s iron ore, limestone and dolomite mines. )he compan$ has the distinction of being 'ndias largest producer of iron ore and of having the countr$s second largest mines network. )his gives them a competitive edge in terms of captive availabilit$ of iron ore, limestone, and dolomite which are inputs for steel making. B-,)-a* P#2e( 3 S&eel L&/ Bhushan ower F Steel (td., an 'S; *++, certified compan$, is a merged entit$ of Bhushan 'ndustries (td., Bhushan .etallics (td. and 6ecor Steel (td. Bhushan Steel has a turnover of more than >S6 /5+ .illion and is a leading manufacturer of Dlat, Round and value added products in Steel. Bhushan have 7 %orld class and state of art plants at #handigarh, 6erabassi, Holkata and ;rissa in 'ndia. & completel$ integrated plant is commissioned under hase ' in ;rissa and hase '' is all set for take off. 'n ;rissa plant, technolog$ and e8uipments are procured from world7renowned #ompanies like (uirgi from Aerman$, &BB (td., S.S 6emag, Siemens etc. 't is selling its Galue added range of products in Secondar$ Steel through a large distribution network in 'ndia !comprising more than ,/ sales offices" and &broad. 15

4'*/al S&eel 3 P#2e( L'$'&e/ 04SPL1 ?indal Steel and ower !?S (", part of the >SE5 billion ?indal ;rganisation, has business interests in steel production, power generation, mining iron ore, coal and diamond exploration1mining. )he current turnover of the compan$ is over Rs. -+ billion and on a path of catal$zing economic development of the countr$ through its contribution to the infrastructure sector. ?S ( with its obsession for excellence, is increasing its portfolio of value7added products, bringing the worlds best to 'ndia and making an international mark. ?oint roduction #apabilities expanded to serve the infrastnicture sector, catal$sing lant #ommittee" at Raigarh in the state of #hhattisgarh, 'ndia. )he facilities economic, development and growth. ?S ( has the integrated steel plant !as approved b$ include worlds largest coal7based Sponge 'ron lant with a capacit$ of 1.-2 million ) & using ten indigenousl$ developed rotar$ kilns. )he compan$ has achieved complete backward #orporate #atal$st 'ndia & report on 'ndian 'ron and Steel 'ndustr$

integration with its captive iron F coal mines making it one of the lowest7cost producers of sponge iron )he steel making capacit$ has been expanded from 5++,+++) & to 1.1/ million ) &. ?S ( toda$ is the largest private sector investor in #hhattisgarh with a total investment of Rs.1++ billion. ?S ( has recentl$ signed an .o> with the State Aovernment of ;rissa to set up a , million tonne steel plant with an investment of Rs.1-./ billion which would be expanded to 3 million tonne and another .o> has been signed with the State Aovernment of ?harkhand to set up a / million steel plant with an investment of Rs.1,+ billion.

1/

ESSAR S&eel <ssar Steel (imited !the K#ompan$L" is the flagship #ompan$ of the <ssar Aroup and looks after the Aroups interest in the steel business. )he #ompan$ was incorporated in ?une 1*23 under the name of <ssar #onstruction (imited and was engaged primaril$ in core sector activities, including marine construction, pipeline la$ing, dredging and other port7related activities. 'n 1*05, the #ompan$ ventured further into other core sectors mainl$ the field of exploration and development, drilling onshore and offshore oil and gas wells for 'ndian 1*02. 'n &ugust 1*02, the #ompan$s name was changed to <ssar Au=arat (imited, to reflect its highl$ diversified business interest. 'n 1*00, the #ompan$ made an initial public offer for its shares, which are now listed on Bomba$ Stock <xchange, Bational Stock <xchange of 'ndia and , other 'ndian Stock <xchanges. )he #ompan$ diversified into the steel business in late 1*0+s with the purchase of an :B' manufacturing plant in <mden, Aerman$, which was dismantled and relocated to :azira, on the west coast of 'ndia. ublic Sector oil exploration companies. 'n view of this the #ompan$s name was then changed to <ssar ;ffshore and <xploration (imited in .a$

1.5

SWOT ANALYSIS
)he S%;) anal$sis of the compan$ refers to the strengths F weaknesses inherent

in the organization F the opportunities F threats faced b$ them from the environment, internal as well as external. )his anal$sis is the foundation stone of the strategic planning process as well as short7term plans needed to attain the strategic ob=ective of the organization. )he anal$sis has been done in order to have a better understanding of the organization. )he information given b$ the organization has been used to carr$ out the

13

anal$sis. )he strengths, weaknesses, opportunities F threats identified are enumerated as followsM A1 S&(e*6&-: ;ne of the largest and lowest cost producers of coal based sponge iron in the countr$. )otal backward integration ensuring stead$ stream of profits #aptive mining of iron ore and coal with coal washer$ facilit$ #aptive power generation B1 'dentif$ing pro=ects and business opportunities. <xpertise in pro=ect implementation at low capital cost and within the schedule time. (owest cost producer of sponge iron !coal based in the countr$". :uge reserve of iron ore and coal in mines. )he worlds longest rail developed in the factor$ brightens compan$s future outlook. Wea7*e)): C1 6omestic consumption of steel dependent on infrastructure spending b$ A;'. O%%#(&,*'&+: Dorward integration into value7added beams will drive future growth. &ssociation with BHH to create huge export potential for Rails. State of #hhattisgarh encourages the setting up of new power pro=ects. )he Aovernments polic$ to privatize the power trading leaves new opportunities opened for the compan$. Reduced availabilit$ of steel scrap !substitute for the sponge iron" will increase demand for the sponge iron. )he increasing price of steel in the market will maximize the profitabilit$ of the compan$ further. roducts, Rails F >niversal

12

D1

T-(ea&): Sponge iron prices movements are dependent on international scrap prices, which fluctuate widel$. )he main competitors like S&'(, )'S#;, .'))&( S)<<(, ?S ( etc. of BS'(.

E1

C-alle*6e): )he gap between demand and suppl$ of steel is increasing. increased production. )he

challenge before the compan$ is to fulfill the customer needs through

10

CHAPTER 2 RESEARCH OB4ECTIVE AND METHODOLOGY

1*

2.1

SIGNIFICANCE
)he first F foremost step in an$ research work is to identif$ the problems or

ob=ectives on which the researcher has to work on. &n$ Research has its own importance in an$ business organization . research shows the real fact about product as well as organization. )he

Research is a

s$stematic and scientific investigation of an$ idea either precise or abstract from a continuous basis for learning , it could be either explorator$ or descriptive. &ccording to above definition research is a s$stematic and scientific investigation through which an$ organization tr$ to find out its strength and weakness as well as opportunit$ and threat. &s we know in the present era the business activities have become more complex and complicated due to modern technolog$, globalization and liberalization and in other hand toda$ customer are highl$ conscious about products and brand . 'n recent time customers are not blind follower of a product. )he$ are giving high priorit$ to all feature like price, 8ualit$, innovative features etc. But after all this features brand becomes the inevitable parts of an$ product because it gives the complete identification of product so it is also the one most important part. .$ research work is highl$ focused on this issue, which is important for me as well as the organization. 6uring research work ' learnt retailers opinion about product and services . ' learnt which factors affect the retailer to sale an individual product, this research gives me insight to understand the retailers problem as well their area of interest, in this ' got the great experience about the market Dor compan$ point of view ' tried to find the serious drawback, which is highl$, affected the sale of chocolates. ' tried to find market share of S&'( which is itself important .' tried to find the sale figure of S&'( in term of rupees, due ,+

to some hurdle ' dont claim m$

research work is 1++@ accurate because so man$

factors was uncontrolled during the pro=ect .' tried to finish m$ research with 1++@ accurac$ which is best available in market .

2.2

MANAGERIAL USEFULNESS OF THE STUDY

)he research is a s$stematic investigation of an$ idea. )he research is widel$ used

in the business world for anal$zing F evaluation business polic$ as well as the anal$zing F evaluates competitors activit$ and polic$. )he research is itself valuable. )he research gives fact and figure, which is useful in planning. &s it is obvious an$ business activit$ is based on to the 5 s of marketing viz. price, product, promotion, place all these s have its own importance and all are inter7 related with each other but most importantl$ all the factor are independent in the nature. 'n an$ organization all factors are carefull$ formulated to gain a success in the market. 't is ver$ important for business anal$st to evaluate the modern trend and market position. 'n the other hand it is vital for business operation to know the need and desire of customer. &ll the necessar$ information is received from market b$ research work. )he stud$ reveals man$ facts that have come up during m$ pro=ect and these facts can either be used as opportunities in exploring and expanding the business as well as can be used as safeguards against threats b$ the competitions. )o prepare an effective marketing strateg$ a compan$ must stud$ it s competitors as well as its actual and potential retailer. & compan$ should maintain good relation with their distributors and retailers keeping in view competitive orientation in toda$s global market. #ompan$ should neither put much emphasis on competitors positioning nor should it solel$ concentrate on its own products and polic$. Rather it should find midwa$ between these two extremes and adopt flexible polic$. #ompanies should manage a good balance of declares retailer, consumer F competitors monitoring . )he information will prove beneficial in taking proactive action for combating competition .the standing of the compan$ and its competitors in the mind off the retailer in a vital factor in deciding the success of business the stud$ also aims at finding out the

,1

market share in term of their sale, product penetration demand etc which is ad=usted b$ retailer. )his information is good guide to management as it brings out the strength of the competition their product penetration, product demand their promotion polic$, which gives an overview where the compan$ needs to improve. )his stud$ basicall$ aimed at providing the management desired vital information about the market situation.

2.!

OB4ECTIVES OF THE STUDY

Steel 'ndustries pla$ a vital role in maximization of national income in ever$ countr$ like 'ndia. )he ob=ective of the pro=ect is to evaluate the contribution and performance of steel industries in 'ndia. )his evaluation is also concerned with the competitiveness of 'ndian steel industries in foreign market. )hese evaluations are based on the kind of efforts that the 'ndian steel industries are making and generating desired results for maximum performance. )he following are the ob=ectives of m$ present stud$M7 )o stud$ the role of 'ndian Steel 'ndustr$ in the contribution to Bational 'ncome. )o evaluate the present marketing strateg$ and ke$ attributes help to enhance the efficienc$ of Steel 'ndustr$. )o know the export capacit$ of 'ndian steel industr$ to enhance national income.

2."

SCOPE OF THE STUDY

)here are some of the following scopes of stud$M7 )his stud$ can be applied to find out an effective role of steel industries related to other economic sectors in 'ndia. Drom the present stud$ we can know the market share of different Steel firms and accordingl$ formulated strateg$ to enhance it.

,,

)he present stud$ can be extended to assess the present marketing condition of different Steel lants.

)he stud$ can be used to design a proper product, price, place F promotional strateg$ for the b$7products of different Steel lants.

2.5 RESEARCH METHODOLOGY

)he author has carried out a research which is both 8ualitative and 8uantitative in its support. )he 8ualitative approach applies to both, descriptive and inductive forms of research. %hile as in case of 8uantitative approach, an extensive use has been made of the literature available to carr$ out a detail research on the nature of the problem. )he author has chosen S&'( F )&)& Steel as the target companies in particular. & combination of both primar$ and secondar$ resources have been used to achieve the aims and ob=ectives of this report P('$a(+ /a&a 8#lle8&'#* $e&-#/) Sa$%le )'9e: Sa$%le a(ea: Sa$%le ,*'&: 1++ B#R 6elhi officials and emplo$ees of S&'( F )ata steel

.et-#/ #. 8#lle8&'#* #. /a&a: 9uestionnaire method as well as interview method was emplo$ed to extract best results from the target respondents

Se8#*/a(+ Re)ea(8)he secondar$ sources of data consists of books for an academic perspective, industr$ =ournals, magazines for competitive strateg$, annual reports, government publications and views of other authors. Some of the secondar$ sources of information include

,-

 Books 'nternet links ?ournals

A*al+)')
)he results of the 8uestionnaire were anal$zed using graphs and charts and a trend on the internal working of the organization were marked out. )his allowed reaching conclusions on the issue as to whether the internal operations of the organization are conducive for growth or not. )he results of the interviews would allow us to go in7depth into the marketing policies of the organization and would allow us to link it to the future competitive position. Both 8uantitative and 8ualitative data anal$sis shall be done b$ using appropriate means which complies with both academic and professional standards.

,5

2.:

LIMITATIONS 3 DIFFICULTIES

'n completing the stud$ the investigator encountered number of difficulties. 'n such a short span of time it is ver$ difficult to stud$ the whole personnel functions or a1c of the organization. )he impact of the marketing programme on organization is a continuous process. 't is impossible to stud$ the whole procedure within such a short span &part from this there were lots of other problems encountered during the research work. )he officials were ver$ hesitant and reluctant to give interviews and answers to 8uestions of investigators.

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CHAPTER ! CONCEPTUAL DISCUSSION

,3

'n this chapter the author has discussed and criticall$ anal$zed the literature related to competitive dimensions F advantages which are crucial in modern economic environment. )he effective marketing strategies of S&'( to attain competitive advantage have also been discussed here. )echno7economic parameters, cost effectiveness, human resource management issues, Research F 6evelopment, environment management, public relations, cost competitiveness, 8ualit$ competitiveness, all these issues in regard to steel sector in 'ndia have been discussed in length. )his section also discusses the policies of marketing and strategic planning as well as the demand for steel and its relevance to national econom$.

COMPETITIVE DIMENSIONS 3 ADVANTAGES ARE CRUCIAL IN MODERN ECONOMIC ENVIRONMENT

Aiven the choices that customers face toda$, how do the$ decide which product or service to bu$N 6ifferent customers are attracted b$ different attributes. Some customers are primaril$ interested in the cost of a product or service, and correspondingl$ some companies attempt to position themselves to offer the lowest price. )he ma=or competitive dimensions that form the competitive position of a compan$ include the following. C#)& ; <Ma7e '& 8-ea%= %ithin ever$ industr$, there is usuall$ a segment of the market that bu$s solel$ on the basis of low cost. )o successfull$ compete in this niche, a firm must be the low cost producer, but even doing this does not alwa$s guarantee profitabilit$ and success. P(#/,8& >,al'&+ a*/ (el'ab'l'&+ ; <Ma7e '& 6##/=. 9ualit$ can be divided into two categoriesM product 8ualit$ and process 8ualit$. )he level of 8ualit$ in a products design will var$ with the market segment at which it is aimed. ;bviousl$, a childs first two wheeled bic$cle is of significantl$ different 8ualit$ than the bic$cle of a world class c$clist. )he goal in establishing the proper level of product 8ualit$ is to focus on the re8uirements of the customer. ;ver7designed products with too much 8ualit$ will be viewed as prohibitivel$ expensive. >nder7designed products, on the other hand, will lose

,2

customers to products that cost a little more but are perceived b$ the customers as offering greater value. rocess 8ualit$ is critical because it relates directl$ to the reliabilit$ of the product. Regardless of whether the product is a childs first two wheeler or a bic$cle for an international c$clist, customers want products without defects. )hus, the goal of process 8ualit$ is to produce error free products. Del'?e(+ )%ee/@<Ma7e '& .a)&.= 'n some markets, a compan$s abilit$ to deliver$ more 8uickl$ than its competitors ma$ be critical. Seeing a need for speed$, reliable overnight deliver$, D<6<O became a E1/ billion compan$ and the worlds large expedited deliver$ service. Del'?e(+ (el'ab'l'&+@<Del'?e( '& 2-e* %(#$')e/.= )his dimension relates to the abilit$ of the firm to suppl$ the product or service on or before a promised deliver$ due date. Dor an automobile manufacturer it is ver$ important that their supplier of tires provide the needed 8uantit$ and t$pes for each da$s car production. C#%'*6 2'&- 8-a*6e) '* /e$a*/ ; <C-a*6e '&) ?#l,$e.= 'n man$ markets, a compan$s abilit$ to respond to increases and a decrease in demand is an important factor in its abilit$ to compete. 't is well known that a compan$ with increasing demand can do little wrong. %hen demand is strong and increasing, costs are continuousl$ reduced due to economics of scale, and investments in new technologies can be easil$ =ustified. But scaling back when demand decreases ma$ re8uire man$ difficult decisions relating to la$ing off emplo$ees and related reductions in assets. )he abilit$ to effectivel$ deal with d$namic market demand over the loan term is an essential element of operations strategies. FleA'b'l'&+ a*/ *e2 %(#/,8& '*&(#/,8&'#* )%ee/@<C-a*6e '&=. Dlexibilit$, from a strategic perspective refers to the abilit$ of a compan$ to offer a wide variet$ of products to its customers. &n important element of this abilit$ to offer different products is the time re8uired for a compan$ to develop a new product and to convert its processes to offer the new product.

,0

&ccording to a report published in )imes of 'ndia !,++2" S&'( had received Pexcellent rating for achieving targets set in the .;> with the Aovernment for the $ear ,++/7+3. #onsidering the sustained growth demonstrated b$ the compan$ during ,++37+2, a similar rating is expected this $ear as well. 6uring ,++/7+3, while maintaining capacit$ utilisation at 1+5@, the compan$ focused on the production of finished steel, lower energ$ consumption and reduction in coke rate, increased production through the continuous cast !##" route and improved the product mix during ,++37+2.

E..e8&'?e )&(a&e6'e) #. SAIL &# a&&a'* 8#$%e&'&'?e a/?a*&a6e

6espite the market remained buo$ant, the rising steel production worldwide put tremendous pressure on availabilit$ of essential inputs like coking coal. 6espite facing a severe coking coal crisis during the first half of ,++37+2, however, the S&'( plants achieved all7time best performance b$ optimising operations and la$ing a thrust on value addition in downstream units such as production of finished steel, plates, rails, structural steel, etc., total finished steel production went up b$ 5 lakh tones to a record level of *.,0 million tonnes !.)", a growth of /@ over the previous $ear. )he proportion of finished steel production in total steel went up to 05@ during ,++37+2 from a level of 0+@ achieved in ,++/7+3. )he S&'( plants showed marginal increase in production of crude steel as well as saleable steel I ,1,+++ tonnes and 5,+++ tonnes respectivel$. )he four main integrated steel plants of S&'( produced a record 2./- .) of steel through the concast route during the $ear. )his was 5@ higher than the ## production of the previous $ear. &s a result, the proportion of B;D7## production went up to 35@ of total crude steel production. 'n fact, ,++37+2 save best7ever average capacit$ utilisation of continuous casting facilities at 1,/@. roduction of value7added items like plates, bars F rounds and railwa$ products recorded growth. late production at ,.1, .) was the highest ever, with a growth of 1/@ Bhilai steel plant also produced 035,++ tonnes of rails, the highest so far and 2@ more than the production in ,++/7+3. )he first consignment of 3/7meter long rails welded into 1-+7meter panels was dispatched b$ BS to the 'ndian Railwa$s during the $ear. roduction of wheels Faxels b$ 6urgapur Steel lant at ,*,+++ tonnes was the highest ever and -0@ more than that of ,++/7+3.

,*

)he long product plants also produced the highest7ever volume of /.5 lakh tonnes of bar F rounds during the $ear recording a growth of 0@. & total of 3 lakh tonnes of structurals were produced b$ S&'( in ,++37+2, -@ higher than the previous $ear and the highest so far. )he three special steel plants of S&'( at 6urgapuri, Salem and Bhadravati together produced -.2* lakh tonnes of saleable steel, the highest ever and ,2@ more than their achievement of ,++/7+3, contributing substantiall$ to the compan$s cumulative production performance. )he total iron ore re8uirement of the S&'( plants was met from captive sources. )he compan$s mines produced 1*.0- .) of iron ore, the highest ever, during the $ear. )he mines of Raw .aterials 6ivision in the eastern part of the countr$ together produced nearl$ 1- .) of iron ore, showing a growth of around 1.,@ over the previous $ear and setting a record. %hile all the R.6 mines registered best7ever $earl$ output, Barusa 'ron .ine deserves special mention for showing highest growth of 15./@ with a production volume of 1,-51,+++ tonnes. )he special thrust laid b$ R.6 during ,++37+2 on 8ualit$ enhancement measures and cost reduction resulted in better productivit$ and effective mitigation of the compan$s variable input costs. &mong the various steps taken b$ R.6 to enhance efficienc$ were better mine planning, development of mines in new areas, improved processing facilities, and replacement of old heav$ earthmoving machiner$ with new e8uipment. &doption of various cost cutting measures led to substantial savings. 6uring ,++37+2, S&'( became the first industrial enterprise in the countr$ to wheel surplus power from one of its captive units to another through the national grid. Aeneration of power b$ the captive power units at /,/ .% was also the highest ever, showing a growth of 3@ over ,++/7+3

Te8-*#Be8#*#$'8 %a(a$e&e()
T-e .#ll#2'*6 a(e &-e &e8-*#Be8#*#$'8 %a(a$e&e():B C#7e (a&e: (owest ever rate of /-3 kg1tonne of hot metal was achieved during the $ear, an improvement of 1@ over ,++/7+3. Re.(a8&#(+ 8#*),$%&'#*: &t 13.2 kg1tonne of crude steel, was lowest ever, *@ lower than the consumption in ,++/7+3, due to significant increase in B;D lining and ladle life at all the plants. -+

E*e(6+ 8#*),$%&'#*: )he S&'( plants together consumed onl$ 2.,0 giga calories per tonne of crude steel on an average, which was ,@ lower than the previous $ear, in spite of the increase in production of value7added steel which consumes higher energ$.

C#)& E..e8&'?e*e))
<conomic )imes states that the thrust on improving efficienc$ of cost management launched b$ S&'( during the downturn in the steel sector continued during the $ear ,++/. Bew schemes were identified and existing schemes reviewed and revised to offset the impact of the sharp rise in input prices, particularl$ in the case of coking coal, Derro allo$s, etc., during the $ear, resulting in savings of about Rs. 1-+ crore. S&'(s cost management endeavours once again received recognition at the national level. )he 'nstitute of #ost F %orks &ccountants of 'ndia ad=udged S&'( as being the second best compan$ in the public sector in 'ndia during ,++/ in this parameter and presented the compan$ its Bational &ward for <xcellence in #ost .anagement. S&'( had received the winners troph$ last $ear for excellence in cost reduction during ,++5.

Ma(7e&'*6 M,)8le
)he consumption of finished steel in the countr$ is estimated to have crossed the -- .) mark during ,++37+2 a growth of about 3@ over the previous $ear. 'n line with the increased level of consumption, S&'( established a new domestic sales record of 1+..), an increase of 0@ over the achievement of the previous $ear. )o ensure higher availabilit$ of steel in the domestic market, S&'( consciousl$ contained exports at a minimum level during the $ear. )he compan$ shipped onl$ about 5 lakh tonnes of steel during the $ear against 11 lakh tonnes in ,++-7+5. S&'( sold a total volume of 0.3 .) of finished steel during ,++37+2 recording a growth of 0@. )he ma=or product categories in which sales growth took place were plates !-,@", :R coils !0@", ).) !-+@", wheels F axles !--@" and heav$ structurals !,+@". Supplies of rails to the 'ndian Railwa$s increased b$ /@ over the previous $ear to 2.- lakh tonnes, including long rails up to a length of 20 meters.

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& thrust was given on suppl$ing steel on priorit$ to user segments of national importance such as government, S>s !public sector undertakings" and state small scale industr$ corporations !SS'#s". &s a result, there was a ,/@ increase in supplies of S&'( steel to the government sector and 3/@ to SS'#s. &long with 5+@ higher supplies to pro=ects, S&'( was able to hike supplies to consumers b$ 12@ during the $ear on an overall basis. 6uring the $ear, all the branches, stock$ards and offices of #.; were linked to a centralised database. )his helped in online availabilit$ of data, consistent data integrit$ and seamless information flow across all applications, leading to increased efficienc$ in serving customers.

H,$a* Re)#,(8e Ma*a6e$e*&

&round 5,2++ emplo$ees separated from the compan$ during DQ +2, around 1,55+ voluntaril$. S&'(s total manpower at the end of the $ear thus stood at around 1,2,+++, showing a reduction of about 50,+++ since 1**0. )he compan$s labour productivit$ grew b$ 5@ to 15, tones1man1$ear in ,++37+2. )o e8uip emplo$ees with higher technical skills, S&'( has signed an agreement with )ata7#orus1>H and #&'1&ustria for provision of specialised training. Sharing of prosperit$ with emplo$ees was a ma=or management thrust during ,++37+2. &mong the initiatives taken in this regard were pa$ment of wage1salar$ arrears for the period 1.1.1**2 I -1.1,.,+++, restoration of earned leave encashment, enhancement in conve$ance expenses, mining allowance, reimbursement of night shift expenses, enhanced incentive pa$ments, etc. & rolling troph$ was introduced to encourage management excellence amongst $oung managers of the compan$. & team from Bhilai Steel lant lifted the inaugural #hairmans )roph$ for Qoung .anagers for the $ear ,++5 from amongst 1-+ contesting teams across the organisation. )en S&'( emplo$ees were selected b$ the .inistr$ of (abour for the nations highest awards recognising exceptional achievements of workmen for the $ear ,++2. )hree BS Shrem Shri title later this $ear. emplo$ees will receive the Shram Gir shile 2 emplo$ees !/ from BS and , from G'S(" will receive the

-,

Re)ea(8- 3 De?el#%$e*&
)he development measures at S&'( pro=ects at S&'( focus on process improvement, cost competitiveness, product 8ualit$, product development and basic research for improvement in techno7economic parameters to increase capacit$ utilisation. .a=or initiatives aimed at cost competitiveness includedM 'mprovement in lining life of converter to ,,+++ heats in S.S7'' at RS including steel ladles at RS F BS b$ technological initiatives Ra')'*6 %(#/,8&'?'&+ #. DSP S'*&e( Pla*& &# 1.!: &#**e)C$C-( 0%ea7 1.: &#**e)1 'ncrease in BD productivit$ at RS b$ process changes in furnace working from

peripheral working, reversal off B() matrix and other changes in charging s$stem. )echnological initiatives like hot charging of wheels, modification of ingot design, etc., helped in record production of wheels F excles at 6S Reduction in :S. roll spalling at BS( .easures to obtain increased campaign length and reduced roll consumption at BS(. 'nstallation of automation of hot saws in BS s Rail F Structural .ill

P(#/,8& /e?el#%$e*& e..#(&) b+ RDCIS '*8l,/e/ &-e .#ll#2'*6: S&'(7:')<B 3*+ &R grade plates at BS Spring steel at 6S :igh strength cold rolled steel !:S#R7-/" at BS(. Steel noise barriers for roads1highwa$s 6.R7,5* for 'ndian Bav$ warships

E*?'(#*$e*& Ma*a6e$e*&
&ccording to &nnual Report of S&'( published in .arch ,++2, S&'( is committed to providing a health$ environment in and around its steel plants. ;ver , lakh trees planted

--

in ,++37+2 added further substance to the compan$s efforts in this direction. &round 1million trees have been planted so far b$ S&'( at different plant1unit1mine locations. )he S&'( plants1units maintained their thrust on controlling pollution during the $ear. Some of them even received awards for excellence in pollution control measures. )he$ areM Aold award in metal sector for outstanding achievement in environment management for ,++-7+5 b$ Areentech Doundation1Bew 6elhi to BS and RS 'ndira Aandhi .emorial Bational &ward7,++5 for <xcellent BS and RS 'ndira Aandhi .emorial Bational &ward for <xcellent <nvironment and <cological 'mplementation Aold &ward b$ 'AS to Barsua 'ron .ine. ollution #ontrol

'mplementation Aold &ward b$ 'nternational Areenland Societ$ !'AS"1:$derabad to

P,bl'8 Rela&'#*)
&ccording to &nnual Report of S&'( published in .arch ,++2, to reinforce emplo$ee morale, internal communication activities were further strengthened. & planned approach $ielded excellent results, with appreciative feedback from emplo$ees at all levels on the initiatives taken and themes selected to motivate, inform and instill pride in the workforce. %ide and focused communication through both print and electronic media strengthened the image of the organisation amongst the compan$s stakeholders and general public. Revival of the television ad campaign )heres a little bit of S&'( in ever$bod$s life in the later part of the $ear, re7inforced the compan$s image as the industr$ leader in viewers minds due to its excellent recall value. ;ther campaigns such as the one highlighting S&'(s turnaround as the most impressive in 'ndian industr$, Steel Areen and Steel in Beed, S&'( in 6eed were well received b$ the target audiences. & radio =ingle in :indi, Safet$pin se fl$over..., also generated popular response.

C#)& 8#$%e&'&'?e*e))

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&ccording to &nnual Report of S&'( published in .arch ,++2, the following cost reduction measures are adopted in S&'( to gain competitive advantageM7 !a" Reduction in fixed cost through volume growth, reduction in manpower cost and financial charges4 !b" Reduction in variable cost through technological interventions like elimination of ingot steel route, 1++@ Basic ;x$gen Durnace and #ontinuous #asting, coke rate reduction via #6'1auxiliar$ fuel in=ection, and higher levels of process control computerization1automation, leading to enhancement of operating efficienc$4 and !c" B$ business process improvements such as streamlining of supplies of ke$ inputs of steel making through higher utilisation of e7commerce, centralized procurement for select items, etc.

D,al'&+ 8#$%e&'&'?e*e)):
S&'( also emphasize on technolog$ F input 8ualit$ improvement across value chain4 thrust on special 8ualit$ steel and new products4 improvement in process consistenc$ and metal treatment4 advanced online testing and 8ualit$ control facilities4 standardization1automation1process control F '). #orporate lan7,+1, has considered the market growth pro=ections assuming overall steel consumption at about 0@ per annum. :owever, the growth trends and macro7economic indicators could lead to higher growth potential. )herefore, depending on the market growth, strategies of competitors, global economic scenario, government policies and resource availabilit$, S&'(s plans ma$ be revised from time to time, and further growth in terms of volume, products, etc., ma$ be aimed through Areenfield investments, ac8uisitions1mergers etc. )he current plan provides the broad direction for S&'( to move forward and would be reviewed periodicall$.

Ma(7e&'*6 S&(a&e6'e) O. SAIL

Sinha !,++2" categoricall$ states the clinical marketing strategies adopted b$ S&'(, according to Sinha !,++2", the Steel being an industrial commodit$ it is ver$ necessar$ to

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maintain customer relationship for profitabilit$ and smooth running of compan$. S&'( adopts following practices for customer satisfaction. rocedure 1 process adapted to access current 1 future expectation of customers. 't induces market research visiting customer premises attending to customer complaints. #.; has .arket .anagement Aroup where specialists monitor changing demand pattern and development in each .arket segment is carried on. 't has posted market development officers at various locations that are its e$es and ears for monitoring current and future expectation of its customer. )he Business7planning department is exclusivel$ meant to stud$ customerRs changing demand scenario and assess current and future expectation. )o understand customer needs seminars and workshops are also organized b$

S&'(. Building #ustomer Relationship S&'( has adopted the philosoph$ of recognizing segment of the market and identif$ing ke$ customer in segment and giving them preferential treatment. #.; sales executives have been trained to use direct selling as tool for building long lasting relationship with the customers. <as$ access to customers to seek assistance makes proposals send comments and compliments.

Ma(7e& De?el#%$e*&
S&'( has valued customers group in identif$ing their specific needs specific to that group thus segmenting and developing market segment for our products. .a=or product modifications are done as per their specific needs of the .arket segment thereb$ creating product differentiation packages.

4IT Del'?e(+

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?') 6eliver$ means =ust in time deliver$. S&'( is able to make deliver$ =ust in time because it works in pre7planned manner4 it takes order onl$ after consulting the production units. So that the products car be delivered in right time.

P(#/,8&'#* A88#(/'*6 T# Ma(7e& Nee/)

S&'( is alwa$s in touch in market and tries to produce according to market needs. S&'( tries to produce 8ualit$ products 1 new products which full fill the need of market.

P#l'8'e) O. Ma(7e&'*6 A*/ S&(a&e6'8 Pla**'*6

S&'( has responsible function in the working of marketing department. &ll the risk$ developments, taking out solution to crippled situations, this section carries out product pricing and related activities, some of the programmes, policies and procedures are as follows M7

P#)'&'#*'*6 &-e %(#/,8& a ?al,e ba)e/ %la8e '* 8,)&#$e( $'*/.

Dinalize annual sales plan and 8uantit$, monthl$, weekl$, and dail$ rolling programme of Rolling mills in consultation with #.; and mills. )his plan is based on the sales forecast receive from ? > S (1 'ron and steel controller. ;ptimizing the product7mix b$ proper utilization of available stocks. Receiving <n8uiries and complaints, cancellation of orders etc. #oordinating the works of mills and traffic department so as to maximize dispatches. #o7ordinations with #.; from stages of en8uir$, for exports, 6evelopment of new 8ualities of steel. eriodical market surve$s of products to anal$ze the market position. 'mplementation of suggestions received from the customers feed bock. <nsure customer satisfaction b$ meeting customers regularl$4 provide redressal to their problems and fulfillment of demand. development of new rofiles, sections, modification of product scheduling till the orders are completed.

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GROWTH OF STEEL INDUSTRY IN INDIA

)he 'ndian steel industr$s onward =ourne$ in the recent time has been caused of great pride to all of us. )he last four7$ear have seen the deregulated 'ndian steel industr$ performing at its peak level in almost all spheres. Steel production went up b$ 0 percent to reach a level of -- million tones in,++,7+- from -1 million tons recorded a $ear before. )he domestic demand for steel also registered a growth rate of 3 percent and grew from ,2 million toes in ,++17+, to ,* million tons in ,++,7+-. )he most spectacular achievement has, however, been recorded in export performance. <xport of finished steel from 'ndia increased b$ a whopping -2 percent from ,.2 million tons in ,++17+, to -.2 million tons in ,++,7+-. 'n addition, significant improvement was noted in the exports of semi7finished steel, stainless steel and pig iron. &ll these favorable trends have been reflected in the improved profitabilit$ of the ma=or steel markets in both the public and private sectors. )he biggest success stor$ has been that of )'S#;, which has recorded an increase of -*1 percent in its profit during this fiscal compared to the previous $ear. <SS&Rs balance sheet has been in the black after a long time, while other ma=or steel markers nave reduced their losses significantl$. )he fact that such an improvement has come at the time of intense global competition and worrisome proliferation of non7tariff barriers in the development world, speaks volumes about the resilience, the innovativeness and, above all, the competitive spirit of the 'ndian exporters of steel. )he dexterit$, with which the 'ndian exporters diversified their destination markets, modified the composition of their export basket to suit the changing global demand profile, affected sizable reduction in production in production costs and adoption of state7of7the art technologies provides ample testimon$ to the maturit$ of this industr$. Drom highl$ protected inward7looking industr$ of the pre7liberalization $ears it has matures into a modern and globall$ integrated industr$ in an astonishingl$ short span of time. )he evolution of steel industr$ can be divided into three distinct phases. )he first phase commenced with pioneering efforts of the late?amset=i Busserwan=i )ata who laid the foundation of modern steel industr$ in 'ndia b$ establishing a steel plant at ?amshedpur -0

!)ata 'ron and Steel #o." in 1*+3 in the face of sever odds. 6espite initial difficulties, the compan$ underwent continuous expansion achieving 0@ average annual growth rate of capacit$ during first -+ $ears. 'n 1*10, the 'ndian iron and steel compan$ !''S#;" was founded b$ British interests in Bengal. &t first ''S#; restricted it self to the manufacture of big iron primaril$ for export to Areat Britain. 'n1*,3, )he steel corporation of Bengal was formed which under took the construction of a steel mill ad=acent to their blast furnaces. &nother small plant at Bhadravati in .$sore was founded in 1*10 to produce charcoal pig iron. 'n the mid thirties it added facilities to manufacture steel. 'n the context of development, which was taking place in the rest of the world, their efforts could be considered creditable. &t the end of Second %orld %ar, 'ndia had a capacit$ if 1./ million tones, 1 percent of the worlds production )he second phase began immediatel$ after independence. it was clear that if economic independence was to be achieved after political independence and low standard of living of masses was to be raised, a much more accelerated industrial growth was essential. Dor providing the infrastructure base, even in the Dirst Dive Qear lan, new steel plants were planned. 't was decided to set up simultaneousl$ three steel plants. &n agreement was signed on , Debruar$ 1*// with the Aovernment of >SSR for assistance in establishing one million tones steel plant at Bhiali. Aerman$ agreed to assist in setting up a million tones steel at Rourkela and Britain offered to help in founding a million tones plant at 6urgapur. :owever, efforts to obtain assistance from the >S& to set up a plant in Bihar did not $ield results. &bout the same time it was decided to expend )'S#; and ''S#; to a capacit$ of , million tones, 1 million tones respectivel$. )hus the Second Dive Qear lan saw the most striking progress in steel industr$. 6uring this period different units in the steel plants were progressivel$ commissioned increasing the installed capacit$ from about 1./ to 3 million tones. 'n the )hird Dive Qear plan, capacit$ of - public sector steel plants were further increased I Rourkela from 1 to 1.0 million tones, Bhilai from 1 to 1.,/ million tones and 6urgapur from 1 to 1.1.3 million tones I thus giving a six fold boost to the capacit$ existing at the time of independence. )he third phase began with the decision to set up the fourth public sector steel plant at Bokaro. Right from the beginning Bokaro was conceived as 'ndias first steel plant with

-*

indigenous e8uipment, material and technological know7how. )he government of >SSR offered technical and financial assistance and the inter governmental agreement signed on ,/th ?anuar$ 1*3/ envisaged that Bokaro will have maximum 'ndian efforts. resentl$, with the expansion of existing steel plant, particularl$ Bhilai upto 5 mt. expansion and Bokaro upto 5.2 mt expansion. )here are , million ingot tones of mild steel plants, each at Gi=a$nagar in .$sore and Giskhapatnam in &ndhra radesh and an allo$ steel plant at Salem in )amilnadu with a capacit$ of two hundred thousand tones of finished steel. Dacilities have been provided for ultimate expansion of Bhilai Steel lant to 2./ million tones and Bokaro Steel expansion of other steel plant. 'ndia had to depend largel$ on foreign countries in regard to technolog$, e8uipment and consultanc$ service for its steel programme in fifties and sixties. 'n order to reduce this dependence, large capacit$ steel plant e8uipment7manufacturing unit was set up in :eav$ <ngineering #orporation in Ranchi. )his was supported b$ other industries in public sector like Bharat :eav$ <lectrical (imited !B:<(", .ining and &llied .achiner$ #orporation (td. !.&.#", Bharat :eav$ lants and Gends (td.!B: G(", 'nstrumental (imited !'(", :industan .achine )ools !:.)", Aarden Reach Shipbuilders and <ngineers (td. !ARS<", ?essops, Braithwaite and man$ other leading industries in public and private sector )o ensure proper expertise for construction of steel plant the :industan Steel %orks #onstruction (td. !:S#(" was set up. 'n the field of consultanc$ service .etallurgical F <ngineering #onsultant !'ndia" (imited !.<#;B" and .. B. 6astur F #ompan$ !6asturco" were developed. <fforts were also made to standardize ma=or items of e8uipment thus providing the advantage of repeat manufacture b$ using the same design, documentation, engineering, thereb$ ensuring earl$ deliveries and lower costs. )he standardization of steel plant and e8uipment, however, did not mean freezing the technological levels as development in operational scales4 sound maintenance and improvement in the preparation of inputs pla$ vital roles. 't was therefore, necessar$ to freeze the design at a certain stage of development and then improve on them. )he lant to 1+ million tones, besides plans for

5+

?apanese steel industr$, which has made great stride, had also worked on this pattern in its earlier stages. )he 'ndian steel industr$ has thus developed from a small capacit$ of 1.- million tones of ingot steel in 1*25 to 15.3 millions in 1*0070*. #ertain chance in strateg$ of development is called for in order to regain the 8uantum to growth without which the economic development would suffer.

51

CHAPTER " DATA ANALYSIS AND INTERPRETATION

5,

DATA ANALYSIS
PARTB1 DUESTIONNAIRE ANALYSIS SAIL OFFICIALS
!1 for ver$ poor, / for ver$ strong" D1. W-'8- 8#$%a*+ /# +#, &-'*7 ') &-e $a'* 8#$%e&'&#( #. +#,( 8#$%a*+E )&)& Steel ?indal Steel <ssar Steel

5 ".5 " !.5 ! 2.5 2 1.5 1 F.5 F TATA STEEL 4INDAL STEEL ESSAR STEEL SAIL " ! 2 5 TATA STEEL 4INDAL STEEL ESSAR STEEL SAIL

F'6. 1

5-

D2.

H#2 2#,l/ +#, (a&e +#,( 8#$%a*'e)G 8#$%e&'&'?e*e)) '* (ela&'#* &# &-e '*/,)&(+E (ess #ompetitive .oderatel$ #ompetitive Ger$ #ompetitive

5 ".5 " !.5 ! 2.5 2 1.5 1 F.5 F Le)) 8#$%e&'&'?e M#/e(a&el+ C#$%e&'&'?e Ve(+ C#$%e&'&'?e 5 5 TATA STEEL SAIL Le)) 8#$%e&'&'?e M#/e(a&el+ C#$%e&'&'?e Ve(+ C#$%e&'&'?e

F'6. 2

55

D!.

D# +#, &-'*7 be'*6 a %,bl'8 )e8&#( 8#$%a*+ ') a -,(/le .#( &-e 6(#2&- #. &-e 8#$%a*+E Qes Bo

2+@ 3+@ /+@ 5+@ -+@ ,+@ 1+@ +@

$es no

$es no

S&'( -+@ 2+@

F'6. !

5/

D".

I* +#,( #%'*'#* ') +#,( 8#$%a*+ (ea/+ &# eA%a*/ #?e()ea) l'7e #&-e( I*/'a* )&eel 8#$%a*'e)E Qes Bo
*+@ 0+@ 2+@ 3+@ /+@ 5+@ -+@ ,+@ 1+@ +@
$es no ) &) & S) <<( *+@ 1+@ S&'( 0/@ 1/@

$es no

F'6. "

53

D5.

W-a& a..e8& /# &-e 6#?e(*$e*& %#l'8'e) -a?e #* &-e 8#$%a*+E ositive

Begative

0+@ 2+@ 3+@ /+@ 5+@ -+@ ,+@ 1+@ +@

posit ive negative ) &) & S) <<( 3/@ -/@ S&'( 0+@ ,+@

positive negative

F'6. 5

52

D:.

W-a& a..e8& 2'll &-e #%e*'*6 ,% #. &-e I*/'a* )&eel )e8&#( 2'll -a?e #* &-e .,&,(e #. +#,( 8#$%a*+E ositive

Begative

0+@ 2+@ 3+@ /+@ 5+@ -+@ ,+@ 1+@ +@

posit ive negat ive ) &) & S) <<( 2+@ -+@ S&'( 2/@ ,/@

positive negative

F'6. :

50

DH.

I* +#,( #%'*'#*I 2-'8- )&+le #. lea/e()-'% /#e) +#,( 8#$%a*+ -a?eE &utocratic .oderate 6emocratic
5+@ -/@ -+@ ,/@ ,+@ 1/@ 1+@ /@ +@
&ut ocratic .oderat e 6emocrat ic ) &) & S) <<( -+@ 5+@ -+@ S&'( 5+@ ,+@ 5+@

&utocratic .oderate 6emocratic

F'6. H

5*

DJ.

H#2 a(e &-e a&$#)%-e(e a*/ &-e e*?'(#*$e*& a& 2#(7E Ger$ )ensed )ensed .oderate Relaxed Ger$ Relaxed

5+@ -/@ -+@ ,/@ ,+@ 1/@ 1+@ /@ +@

ver$ t ensed t ensed moderat e relaxed ver$ relaxed ) &) & S) <<( -+@ 5+@ ,+@ /@ /@ S&'( -/@ -/@ 1/@ 1+@ /@

ver$ tensed tensed moderate relaxed ver$ relaxed

F'6. J

/+

DK.

H#2 2#,l/ +#, (a&e &-e &,(*#?e( (a&e '* +#,( #(6a*'9a&'#*E Ger$ :igh :igh .edium (ow Ger$ (ow

5+@ -/@ -+@ ,/@ ,+@ 1/@ 1+@ /@ +@

ver$ high high medium low ver$ low ) &) & S) <<( -+@ ,/@ ,+@ 1/@ 1+@ S&'( ,/@ ,+@ 5+@ /@ 1+@

ver$ high high medium low ver$ low

F'6. K

/1

D1F. D#e) &-e 8#$%a*+ #..e( +#, #%%#(&,*'&'e) .#( 6(#2&- a*/ a/?a*8e$e*& #. +#,( 8a(ee(E Qes Bo

0+@ 2+@ 3+@ /+@ 5+@ -+@ ,+@ 1+@ +@

$es no ) &) & S) <<( 2/@ ,/@ S&'( 2+@ -+@

$es no

F'6. 1F

/,

D11. A88#(/'*6 &# +#, -#2 ') &-e 8,l&,(e #. &-e #(6a*'9a&'#*N #onducive for growth :inders Arowth

2+@ 3+@ /+@ 5+@ -+@ ,+@ 1+@ +@

conducive for growt h hinders growt h ) &) & S) <<( 3/@ -/@ S&'( 2+@ -+@

conducive for growth hinders growth

F'6. 11

/-

D12. W-a& /#e) +#,( 8#$%a*+ &-'*7 ab#,& '&) 8,)&#$e()E #ustomer is king #ustomer is 'mportant #ustomers are =ust #ustomers

2+@ 3+@ /+@ 5+@ -+@ ,+@ 1+@ +@

consumer is king consumer is import ant consumers are =ust import ant ) &) & S) <<( 3+@ -/@ /@ S&'( 2+@ ,0@ ,@

consumer is king consumer is important consumers are =ust important

F'6. 12

/5

D1!. D#e) +#,( 8#$%a*+ (e2a(/ +#, .#( +#,( %e(.#($a*8eE Ye) N# S#$e&'$e)

0+@ 2+@ 3+@ /+@ 5+@ -+@ ,+@ 1+@ +@

$es no ) &) & S) <<( 2/@ ,/@ S&'( 2+@ -+@

$es no

F'6. 1!

//

D1". D#e) +#,( 8#$%a*+ -a?e a 8lea( a*/ /e.'*e/ .,&,(e 6#alE

*+@ 0+@ 2+@ 3+@ /+@ 5+@ -+@ ,+@ 1+@ +@

$es no ) &) & S) <<( 0+@ ,+@ S&'( 0/@ 1/@

$es no

F'6. 1"

/3

D15. H#2 8lea( a(e a,&-#('&+ a*/ (e)%#*)'b'l'&+ (ela&'#*)-'%) /e.'*e/ '* +#,( #(6a*'9a&'#*E

5/@ 5+@ -/@ -+@ ,/@ ,+@ 1/@ 1+@ /@ +@

ver$ clear ver$ unclear cant sa$ ) &) & S) <<( 5+@ -+@ -+@ S&'( 5/@ 1/@ 5+@

ver$ clear ver$ unclear cant sa$

F'6. 15

/2

D1:. D# +#, #2* &-e )-a(e) #. +#,( 8#$%a*+E Qes Bo

0+@ 2+@ 3+@ /+@ 5+@ -+@ ,+@ 1+@ +@

$es no ) &) & S) <<( 2/@ ,/@ S&'( 2+@ -+@

$es no

F'6. 1:

/0

D1H. I. +e)I &-e* a(e +#, -a%%+ 2'&- &-e /'?'/e*/ %a+#,&)E 1 , 5 /

*+@ 0+@ 2+@ 3+@ /+@ 5+@ -+@ ,+@ 1+@ +@

$es no ) &) & S) <<( 0/@ 1/@ S&'( *+@ 1+@

$es no

F'6. 1H

/*

D1J. I* +#,( #%'*'#* -#2 -a) bee* &-e %e(.#($a*8e #. +#,( 8#$%a*'e) )&#87 '* &-e (e8e*& %a)&E 1
-/@ -+@ ,/@ ,+@ 1/@ 1+@ /@ +@
good ver$ good sat isfact or$ outst anding ) &) & S) <<( ,+@ -+@ -/@ 1/@ S&'( ,/@ -+@ ,+@ ,/@

good ver$ good satisfactor$ outstanding

F'6. 1J

3+

D1K. W#,l/ +#, '*?e)& $#*e+ '* +#,( #2* 8#$%a*'e) )&#87E Qes Bo
2+@ 3+@ /+@ 5+@ -+@ ,+@ 1+@ +@
$es no

$es no

) &) & S) <<( 3+@ 5+@

S&'( 3/@ -/@

F'6. 1K

31

D2F. T-e .,&,(e ') ?e(+ 8#$%e&'&'?eL /# +#, &-'*7 +#,( #(6a*'9a&'#* ') (ea/+ &# .a8e &-e 8#$%e&'&'#*E 1
2+@ 3+@ /+@ 5+@ -+@ ,+@ 1+@ +@
$es no

$es no

) &) & S) <<( 3+@ 5+@

S&'( 3/@ -/@

F'6. 2F

3,

PARTB2 DUESTIONNAIRE ANALYSIS CUSTOMERS

D1. D# +#, a6(ee &-a& &-e )&eel '*/,)&(+ '* I*/'a ') 2'&*e))'*6 a* '*/,)&('al a*/ $a(7e& b##$E Qes 77777777777777777777777777777777777777777777777777 2/ per cent Bo 7777777777777777777777777777777777777777777777777777 1, per cent 6o not know1 #an not sa$ 77777777777777777777777777 1- per cent

0+@ 2+@ 3+@ /+@ 5+@ -+@ ,+@ 1+@ +@

Qes

Bo

6o not know1 #an not sa$

F'6. 21

I*&e(%(e&a&'#*:
)he above response reflects that the rolling steel industr$ in 'ndia is presentl$ witnessing an industrial and a market boom.

3-

D2.

W-a& .a8&#() 8#*&('b,&e &-e $#)& &# &-e b##$ '* &-') )e6$e*& #. $a(7e&E Arowth in infrastructure pro=ects 7777777777777777777777 ,3 per cent (iberalization of the econom$ 77777777777777777777777777 /+ per cent Special polic$ measures of the government 77777777777 1, per cent ;ther factors 77777777777777777777777777777777777777777777777 +/ per cent 6o not know1 #an not sa$ 77777777777777777777777777777777 +2 per cent

/+@ 5/@ 5+@ -/@ -+@ ,/@ ,+@ 1/@ 1+@ /@ +@ Arowth in infrastructure pro=ects (iberalisation of the econom$ Special polic$ measures of the government ;ther factors 6o not know1 #an not sa$

F'6. 22

I*&e(%(e&a&'#*:
)he liberalisation of the econom$ is the ke$ to the boom. 'n 'ndia demand is being driven up b$ mammoth infrastructure pro=ects, like the construction of dams, ports, power plants, railwa$s and motorwa$s.

35

D!.

W-a& ') &-e a2a(e*e)) #. SAIL '* )&eel $a(7e&E Aood 777777777777777777777777777777777777 -3 per cent ;.H. 77777777777777777777777777777777777777 52 per cent oor 77777777777777777777777777777777777777 11 per cent

6o not know1 #an not sa$ 777777777777777 +/ per cent

/+@ 5/@ 5+@ -/@ -+@ ,/@ ,+@ 1/@ 1+@ /@ +@

Aood

;.H

oor

6o not know1 #an not sa$

F'6. 2!

I*&e(%(e&a&'#*:
)he awareness level in the market about the S&'( products is 8uite good.

3/

D".

H#2 /# +#, )ee &-e eA%#(& $a(7e& #. SAIL '* &-e 2#(l/ )&eel $a(7e&E #ompetitive in the world market 7777777777777777777777777 -, per cent 's in a survival state 7777777777777777777777777777777777777777 ,- per cent 'nsignificant in the world market 777777777777777777777777777 1, per cent 6o not know1 #an not sa$ 7777777777777777777777777777777777 -- per cent

-/@ -+@ ,/@ ,+@ 1/@ 1+@ /@ +@ #ompetitive in the world market 'nsignificant in the world market 's in a survival state 6o not know1 #an not sa$

F'6. 2"

I*&e(%(e&a&'#*:
)he export market of S&'( !'ndia", if we go b$ the views of the respondents, has a significant presence in the world export market.

33

D5.

D# +#, a6(ee &-a& '*8(ea)e '* SAILG) eA%#(& 2a) #*e #. &-e $a'* (ea)#*) .#( &-e (e8e*& eA%a*)'#* '* 6l#bal #. )&eel $a(7e&E Qes 77777777777777777777777777777777777777777777 32 per cent Bo 77777777777777777777777777777777777777777777777 1+ per cent 6o not know1 #an not sa$ 77777777777777777777 ,- per cent

2+@ 3+@ /+@ 5+@ -+@ ,+@ 1+@ +@

Qes

Bo

6o not know1 #an not sa$

F'6. 25

I*&e(%(e&a&'#*:
)he industrial expansion of S&'( in terms of production and market is more or less driven b$ the export drive of the market in general and the industr$ in particular.

32

D:.

W-'8- a(e &-e $aM#( eA%#(& $a(7e&) #. +#,( 8#$%a*+E )he compan$ exports more than 5+ percent of its production to countries like #hina, .iddle7<ast, <urope and the >.S. etc. )he export growth is driven b$ in house development of low Bickel P? series rolling steel. )he compan$ has also a strong presence in certain overseas markets for its thin cold rolled strips and coils for a variet$ of scientific and industrial usage.

30

DH.

D# +#, a6(ee &-a& &-e I*/'a* S&eel $a(7e& ') 6(#2'*6 a& a .a)& %a8e a*/ &-e(eb+ a&&(a8&) .#(e'6* '*?e)&#() a*/ $a(7e& lea/e()E Qes 7777777777777777777777777777777777777777777777777 03 per cent Bo 777777777777777777777777777777777777777777777777777 +3 per cent 6o not know1 #an not sa$ 77777777777777777777777 +0 per cent

*+@ 0+@ 2+@ 3+@ /+@ 5+@ -+@ ,+@ 1+@ +@

Qes

Bo

6o not know1 #an not sa$

F'6. 2:

I*&e(%(e&a&'#*:
)he fast growing 'ndian rolling steel market provided good market opportunities for rolling steelmakers, and attracted man$ domestic and foreign investors attention. 't is a fact that the 'ndian rolling steel industr$ is being developed ver$ fast in recent $ears.

3*

DJ.

W-a& a(e &-e $a(7e&'*6 )&(a&e6'e) a/#%&e/ b+ SAIL '* b#&- &-e /#$e)&'8 a*/ '*&e(*a&'#*al $a(7e&E roduct <xpansion 777777777777777777777777777777 5/ per cent -+ per cent

Strengthening the export strateg$ 77777777777777

)o create demand for our products 77777777777777 1, per cent ;ther measures 777777777777777777777777777777777777777+, per cent 6o not know1 #an not sa$ 77777777777777777777777777 +1 per cent

5/@ 5+@ -/@ -+@ ,/@ ,+@ 1/@ 1+@ /@ +@

roduct <xpansion )o create demand for our products 6o not know1 #an not sa$

Strengthening the export strateg$ ;ther measures

F'6. 2H

I*&e(%(e&a&'#*:
)he Steel makers are resorting to product expansion for strengthening their domestic and overseas market. Besides the above stated measure, the companies are also working in the direction of building a competitive marketing strateg$ and creating domestic demand for their products.

2+

DK.

W-a& a(e &-e '$%e/'$e*&) &# '$%(#?e &-e eA%#(& %#&e*&'al #. SAILE Structural impediments 7777777777777777777777777777777777 53 per cent )ariff related issues 7777777777777777777777777777777777777777 12 per cent >nstructured market 7777777777777777777777777777777777777 ,+ per cent ;ther factors 7777777777777777777777777777777777777777777777 1+ per cent 6o not know1 can not sa$ 77777777777777777777777777777777 +2 per cent

/+@ 5+@ -+@ ,+@ 1+@ +@

Structural impediments >nstructured market 6o not know1 can not sa$ F'6. 2J

)ariff related issues ;ther factors

I*&e(%(e&a&'#*:
'ndia is a large and growing consumer of steel products, making it a net importer. 'ndia is struggling to fix a m$riad of structural and performance problems that threaten its rolling steel industr$M industr$ fragmentation, poor product 8ualit$, low labor productivit$, an overl$ narrow product range !concentrated at the low, value7added end of the market", growing domestic demand and suppl$ imbalances and obsolete plant and e8uipment. )he industr$ remains grossl$ inefficient, technologicall$ backward and unable to meet ade8uatel$ the ever7changing needs of the market.

21

D1F. H#2 /# +#, )ee &-e .,&,(e #. SAIL '* I*/'aE Bright future ahead 777777777777777777777777777777 ,- per cent #ompetitive 777777777777777777777777777777777777777 /+ per cent Duture is not good 777777777777777777777777777777777 +/ per cent 6o not know1 can not sa$ 7777777777777777777777777 ,, per cent

/+@ 5/@ 5+@ -/@ -+@ ,/@ ,+@ 1/@ 1+@ /@ +@ Bright future ahead Duture is not good F'6. 2K #ompetitive 6o not know1 can not sa$

I*&e(%(e&a&'#*:
6espite an increase in production costs, S&'( has been successful in improving its operating profit per ton on an absolute basis, due to consistent improvement in product7 mix.

2,

CHAPTER 5 FINDINGS AND RECOMMENDATIONS

2-

E?al,a&'#* #. Ma(7e&'*6 S&(a&e6+ #. SAIL

.arketing is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create and exchange that satisf$ individual and organizational ob=ective. )he marketing concept re8uires that customer satisfaction rather than profit maximization is the goal of the organization. 'n other words, the organization should be consumer oriented and should tr$ to understand consumers re8uirement and satisf$ them 8uickl$ and efficientl$, in wa$ that are beneficial to both organization and the consumer. )his means that an$ research organization should tr$ to obtain information on consumer need and gather marketing intelligence to help and satisf$ these needs efficientl$. .arketing research is a critical part of such a marketing intelligence s$stem, it helps to improve management decision making b$ providing relevant, accurate and timel$ information. <ver$ decision poses uni8ue needs for information and relevant strategies can be developed based on the information gathered through marketing research. ;ne of the ma=or tasks in researching a market is to estimate its a current decisions hang on these estimates whether the market demand upon in future to =ustif$ the market entr$. ;nce a compan$ enters a market segment in order to allocate it resources effectivel$. )hus we can see that demand estimate is essential in carr$ing out three important functionsM 7 &nal$sis of market opportunities lanning of marketing efforts

#ontrol of marketing performance & market is a set of all actual and potential bu$er of a product. )he actual or, available market is a set of bu$er who has interest and access to a particular market offer. 'f the organization is not satisfied with its current sales or has some expansion plans, it could tr$ to attract a large percentage of people from its served market b$ promoting the

25

product to available market. >ntimel$ it could tr$ to expend the potential market b$ launching the campaign to convert uninterested bu$er into interested bu$er. BY PRODUCT: 'n the steel industries we heated the coke we get some gas and tar product such as &mmonia, )ar, Benzene etc. )hese products are unwanted but we cant leave them vain. Because the$ are profitable as well as harmful for the environment and industries. So we go through the certain process and made some valuable product. EAa$%le: B %hen Bokaro heat the coke we get ammonia gas, we mix it in the sulfuric acid and made ammonia sulphate that use as a fertilizer with brand name R&?&. SECONDARY PRODUCT: 'n the process of making core pro=ect some defective come out. Because of some of break down and some mechanical default. %e also get some scrap in the process of making cutting sheets. )hese secondar$ products are process from the beginning or sold through the auction and lot sale. Dor a nation that is economicall$ strong, free of the problems of underdevelopment and pla$s a meaningful role in the world as befits a nation of over one billion people, the groundwork would have to begin right now. )he 'ndian Steel 'ndustr$ will be re8uired and is willing to pla$ a critical role in achieving this target. T-e .'*/'*6) .(#$ ab#?e /a&a a*/ '*&e(%(e&a&'#*) &-e(e#. a(e a) .#ll#2): %ith abundant iron ore resources and well7established base for steel production in the countr$, steel is poised for growth in the coming decades in 'ndia. wa$ steel industr$ is contributing much in national income at a high pace. Steel will continue to have a stronghold in traditional sectors such as construction, housing, ground transportation, special steels will be increasingl$ used in hi7tech engineering industries such as power generation, petrochemicals, fertilizers etc. &s the ke$ attributes discussed above are ver$ much in favor of steel industr$. 'n budget ,++57+/, the customer dut$ on non7allo$ steel was reduced steel from 1/@ to 1+@ and on allo$ steel from ,+@ to 1/@. Durther, custom dut$ on several raw materials roduction has increased from 12 .) in 1**+ to -3 .) in ,++- and 33 .) is targeted for ,+11. 'n this

2/

used b$ the steel sector like non7coking coal, met coke and nickel has been reduced to /@ and on coking coal to zero. So government is also coming forward to make 'ndian steel industr$ a global hub. .arketing is one of the most d$namic fields in an$ business along with finance, production and operations, :uman resource management and s$stems. 'ts orientation needs to be handled carefull$ as it is onl$ through integration of marketing with other fields that makes an organization successful or face the odds. 'ndian steel industr$ is also concentrating on its marketing activities.

POLICY IMPLICATION
)here are some steps need to be taken to help the 'ndian Steel 'ndustr$ achieve its potential which is as followsM Steel is $et to touch the lives of millions of people in 'ndia. er capita consumption of steel in 'ndia is onl$ ,* kg and has to go a long wa$ to reach consumption levels of around 5++ kg in developed countries like >S& and world average of 15+ kg. )here is a need to continue the current thrust on infrastructure related activities and extend them to rural 'ndia. Rural 'ndian toda$ presents a challenge for development of the countr$ and the opportunit$ to increase usage of steel in these areas through pro=ects such as rural housing etc. #urrent shortage of inputs has pushed up the costs for the steel industr$. Aovernment should ensure that 8ualit$ raw material such iron7ore and coke are available to the industr$. %ith .inistr$ of Steel targeting an output of 1++ .) of steel b$ ,+,+ there is an urgent need to develop raw material resources for inputs like iron7ore and coal within or outside the countr$. #ountries like ?apan have alread$ taken similar steps to safeguard their industries. &de8uate enabling infrastructure such as power, ports, roads, rail transport is pre7 re8uisite for the 'ndian steel industr$ to remain competitive.

23

Aovernment should not regulate prices and free market forces should prevail. 'ntervention b$ the Aovernment is onl$ a short7term solution to the issue of steel prices in the countr$. ;nce left alone, market d$namics will automaticall$ ensure price corrections and determine the optimum price of steel. )he 'ndian steel 'ndustr$ is amongst the least protected in the world. %hile developed countries have put numerous tariff and non7tariff barriers on steel exports from the countr$, the domestic industr$ is exposed to cheaper imports from competing nations. &s in case of other important industries, the Aovernment should give reasonable levels of protection to the domestic steel industr$, which is =ust starting to get back on its feet. 'ndustr$ should be allowed to have a fair return on investment and contribute to the overall health of the 'ndian manufacturing segment. )he steel industr$ has invested a capital of over Rs *+, +++ crores. #R'S'( in a recent stud$ has concluded that given the large exposure that banks and financial institutions have to the steel industr$, a health$ steel sector is in the interest of the econom$. Steel industr$ still continues to be unattractive for investors. )oda$, 'ndian producers emplo$ world7class standards of technolog$. Steel from 'ndian finds growing acceptabilit$ in international markets. But despite this 'ndias share in world trade steel is a miniscule ,@. Aiven the capabilities of the 'ndian steel industr$ there is tremendous scope to increase this share further. %hile the steel industr$ will continue servicing the domestic demand there is a lot of untapped export potential with the industr$.

22

INDIAN 2F2F: A VISION FOR THE NEW MILLENNIUM

S%e still have a number of persons in our countr$ in S&'(, )'S#; and other big and small steel plants who have the capabilities. )he$ have the will to excel and transform the countr$, given a long term vision.S

S%e should be read$ to compete in outside marketsT..'f our steel industr$ gears up in about - to 5 $ears, 'ndian steel can be both in 'ndian and foreign markets. ;ur vision should be towards this.S 7 B$ & ? &dbul Halam and QS Ra=an

20

SUGGESTIONS
S,66e)&'#*) T# E*-a*8e E..'8'e*8+ O. S&eel I*/,)&(+ '* I*/'a
)here is a need to continue the current thrust on infrastructure related activities and extend them to rural 'ndia. Rural 'ndian toda$ presents a challenge for development of the countr$ and the opportunit$ to increase usage of steel in these areas through pro=ects such as rural housing etc. #urrent shortage of inputs has pushed up the costs for the steel industr$. Aovernment should ensure that 8ualit$ raw material such iron7ore and coke are available to the industr$. %ith .inistr$ of Steel targeting an output of 1++ .) of steel b$ ,+,+ there is an urgent need to develop raw material resources for inputs like iron7ore and coal within or outside the countr$. #ountries like ?apan have alread$ taken similar steps to safeguard their industries. &de8uate enabling infrastructure such as power, ports, roads, rail transport is pre7 re8uisite for the 'ndian steel industr$ to remain competitive. Aovernment should not regulate prices and free market forces should prevail. 'ntervention b$ the Aovernment is onl$ a short7term solution to the issue of steel prices in the countr$. ;nce left alone, market d$namics will automaticall$ ensure price corrections and determine the optimum price of steel. )he 'ndian steel 'ndustr$ is amongst the least protected in the world. %hile developed countries have put numerous tariff and non7tariff barriers on steel exports from the countr$, the domestic industr$ is exposed to cheaper imports from competing nations. &s in case of other important industries, the Aovernment should give reasonable levels of protection to the domestic steel industr$, which is =ust starting to get back on its feet. 'ndustr$ should be allowed to have a fair return on investment and contribute to the overall health of the 'ndian manufacturing segment. )he steel industr$ has invested a capital of over Rs *+, +++ crores. #R'S'( in a recent stud$ has concluded that given the large exposure that banks and financial institutions have to the steel industr$, a health$

2*

steel sector is in the interest of the econom$. Steel industr$ still continues to be unattractive for investors. )oda$, 'ndian producers emplo$ world7class standards of technolog$. Steel from 'ndian finds growing acceptabilit$ in international markets. But despite this 'ndias share in world trade steel is a miniscule ,@. Aiven the capabilities of the 'ndian steel industr$ there is tremendous scope to increase this share further. %hile the steel industr$ will continue servicing the domestic demand there is a lot of untapped export potential with the industr$.

0+

APPENDIN

01

APPENDIN
PARTB1 DUESTIONNAIRE SAIL OFFICIALS
!1 for ver$ poor, / for ver$ strong" D1. W-'8- 8#$%a*+ /# +#, &-'*7 ') &-e $a'* 8#$%e&'&#( #. +#,( 8#$%a*+E )&)& Steel ?indal Steel <ssar Steel D2. H#2 2#,l/ +#, (a&e +#,( 8#$%a*'e)G 8#$%e&'&'?e*e)) '* (ela&'#* &# &-e '*/,)&(+E (ess #ompetitive .oderatel$ #ompetitive Ger$ #ompetitive D!. D# +#, &-'*7 be'*6 a %,bl'8 )e8&#( 8#$%a*+ ') a -,(/le .#( &-e 6(#2&- #. &-e 8#$%a*+E Qes Bo D". I* +#,( #%'*'#* ') +#,( 8#$%a*+ (ea/+ &# eA%a*/ #?e()ea) l'7e #&-e( I*/'a* )&eel 8#$%a*'e)E Qes Bo D5. W-a& a..e8& /# &-e 6#?e(*$e*& %#l'8'e) -a?e #* &-e 8#$%a*+E ositive

Begative D:. W-a& a..e8& 2'll &-e #%e*'*6 ,% #. &-e I*/'a* )&eel )e8&#( 2'll -a?e #* &-e .,&,(e #. +#,( 8#$%a*+E ositive

Begative

0,

DH.

I* +#,( #%'*'#*I 2-'8- )&+le #. lea/e()-'% /#e) +#,( 8#$%a*+ -a?eE &utocratic .oderate 6emocratic

DJ.

H#2 a(e &-e a&$#)%-e(e a*/ &-e e*?'(#*$e*& a& 2#(7E Ger$ )ensed )ensed .oderate Relaxed

DK.

H#2 2#,l/ +#, (a&e &-e &,(*#?e( (a&e '* +#,( #(6a*'9a&'#*E Ger$ :igh :igh .edium (ow

D1F. D#e) &-e 8#$%a*+ #..e( +#, #%%#(&,*'&'e) .#( 6(#2&- a*/ a/?a*8e$e*& #. +#,( 8a(ee(E Qes Bo #onducive for growth :inders Arowth #ustomer is king #ustomer is 'mportant #ustomers are =ust #ustomers

D11. A88#(/'*6 &# +#, -#2 ') &-e 8,l&,(e #. &-e #(6a*'9a&'#*N

D12. W-a& /#e) +#,( 8#$%a*+ &-'*7 ab#,& '&) 8,)&#$e()E

D1!. D#e) +#,( 8#$%a*+ (e2a(/ +#, .#( +#,( %e(.#($a*8eE Ye) N# S#$e&'$e)

0-

D1". D#e) +#,( 8#$%a*+ -a?e a 8lea( a*/ /e.'*e/ .,&,(e 6#alE D15. H#2 8lea( a(e a,&-#('&+ a*/ (e)%#*)'b'l'&+ (ela&'#*)-'%) /e.'*e/ '* +#,( #(6a*'9a&'#*E D1:. D# +#, #2* &-e )-a(e) #. +#,( 8#$%a*+E Qes Bo D1H. I. +e)I &-e* a(e +#, -a%%+ 2'&- &-e /'?'/e*/ %a+#,&)E 1 , 5 / D1J. I* +#,( #%'*'#* -#2 -a) bee* &-e %e(.#($a*8e #. +#,( 8#$%a*'e) )&#87 '* &-e (e8e*& %a)&E 1 Qes Bo D2F. T-e .,&,(e ') ?e(+ 8#$%e&'&'?eL /# +#, &-'*7 +#,( #(6a*'9a&'#* ') (ea/+ &# .a8e &-e 8#$%e&'&'#*E 1 , 5 / , 5 / D1K. W#,l/ +#, '*?e)& $#*e+ '* +#,( #2* 8#$%a*'e) )&#87E

05

PARTB2 DUESTIONNAIRE CUSTOMERS

D1. D# +#, a6(ee &-a& &-e )&eel '*/,)&(+ '* I*/'a ') 2'&*e))'*6 a* '*/,)&('al a*/ $a(7e& b##$E Qes 77777777777777777777777777777777777777777777777777 2/ per cent Bo 7777777777777777777777777777777777777777777777777777 1, per cent 6o not know1 #an not sa$ 77777777777777777777777777 1- per cent D2. W-a& .a8&#() 8#*&('b,&e &-e $#)& &# &-e b##$ '* &-') )e6$e*& #. $a(7e&E Arowth in infrastructure pro=ects 7777777777777777777777 ,3 per cent (iberalisation of the econom$ 77777777777777777777777777 /+ per cent Special polic$ measures of the government 77777777777 1, per cent ;ther factors 77777777777777777777777777777777777777777777777 +/ per cent 6o not know1 #an not sa$ 77777777777777777777777777777777 +2 per cent D!. W-a& ') &-e a2a(e*e)) #. SAIL '* )&eel $a(7e&E Aood 777777777777777777777777777777777777 -3 per cent ;.H. 77777777777777777777777777777777777777 52 per cent oor 77777777777777777777777777777777777777 11 per cent

6o not know1 #an not sa$ 777777777777777 +/ per cent D". H#2 /# +#, )ee &-e eA%#(& $a(7e& #. SAIL '* &-e 2#(l/ )&eel $a(7e&E #ompetitive in the world market 7777777777777777777777777 -, per cent 's in a survival state 7777777777777777777777777777777777777777 ,- per cent 'nsignificant in the world market 777777777777777777777777777 1, per cent 6o not know1 #an not sa$ 7777777777777777777777777777777777 -- per cent

0/

D5.

D# +#, a6(ee &-a& '*8(ea)e '* SAILG) eA%#(& 2a) #*e #. &-e $a'* (ea)#*) .#( &-e (e8e*& eA%a*)'#* '* 6l#bal #. )&eel $a(7e&E Qes 77777777777777777777777777777777777777777777 32 per cent Bo 77777777777777777777777777777777777777777777777 1+ per cent 6o not know1 #an not sa$ 77777777777777777777 ,- per cent

D:. DH.

W-'8- a(e &-e $aM#( eA%#(& $a(7e&) #. +#,( 8#$%a*+E D# +#, a6(ee &-a& &-e I*/'a* S&eel $a(7e& ') 6(#2'*6 a& a .a)& %a8e a*/ &-e(eb+ a&&(a8&) .#(e'6* '*?e)&#() a*/ $a(7e& lea/e()E Qes 7777777777777777777777777777777777777777777777777 03 per cent Bo 777777777777777777777777777777777777777777777777777 +3 per cent 6o not know1 #an not sa$ 77777777777777777777777 +0 per cent

DJ.

W-a& a(e &-e $a(7e&'*6 )&(a&e6'e) a/#%&e/ b+ SAIL '* b#&- &-e /#$e)&'8 a*/ '*&e(*a&'#*al $a(7e&E roduct <xpansion 777777777777777777777777777777 5/ per cent -+ per cent

Strengthening the export strateg$ 77777777777777

)o create demand for our products 77777777777777 1, per cent ;ther measures 777777777777777777777777777777777777777+, per cent 6o not know1 #an not sa$ 77777777777777777777777777 +1 per cent DK. W-a& a(e &-e '$%e/'$e*&) &# '$%(#?e &-e eA%#(& %#&e*&'al #. SAILE Structural impediments 7777777777777777777777777777777777 53 per cent )ariff related issues 7777777777777777777777777777777777777777 12 per cent >nstructured market 7777777777777777777777777777777777777 ,+ per cent ;ther factors 7777777777777777777777777777777777777777777777 1+ per cent 6o not know1 can not sa$ 77777777777777777777777777777777 +2 per cent D1F. H#2 /# +#, )ee &-e .,&,(e #. SAIL '* I*/'aE Bright future ahead 777777777777777777777777777777 ,- per cent 03

 #ompetitive 777777777777777777777777777777777777777 /+ per cent Duture is not good 777777777777777777777777777777777 +/ per cent 6o not know1 can not sa$ 7777777777777777777777777 ,, per cent

02

BIBLIOGRAPHY

00

BIBLIOGRAPHY
1. Breale$ R, .$ers S, !,++-". K rinciples of #orporate DinanceL, Seventh <dition, Bew 6elhi, )ata .cAraw7:ill. ,. ?ohnson A, Scholes H, %hittington R. !,++/". K<xploring #orporate Strateg$ )ext and #asesL. 2)h <dition, :arlow <ngland. D) rentice :all. -. .ehta, SR, Business %orld, ,++2, volume7,, issue7iv 5. Shroff, esi, ,++/,'ndia )oda$, issue dated 1/th ?une ,++/ /. 3. andhe . H, ,++2, Business )oda$, issue dated 1st &ugust ,++2 orter, < ., !1*0/" K#ompetitive &dvantage, #reating and Sustaining Superior erformance.L >S&, the Dree ress. 2. %harton !1**2" K%harton on 6$namic #ompetitive Strateg$L Bew Qork, ?ohn %ile$ F Sons, 'nc 0. '#D&' ress, ?ournal on 'ndustr$, Deb +3, Golume7, *. 6as SB, Business F <conom$, ?an +3, Golume71 1+. :indu, Surve$ ;f 'ndustr$, ,++3

0*