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"Understanding Marketing Strategies and Marketing Mix of SAIL IISCO, Burnpur" - Research Project during Summer Internship.
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1
UNDERSTANDING MARKETING STRATEGIES
AND MARKETING MIX
USED IN
SAIL-IISCO STEEL PLANT, BURNPUR
A report submitted towards the partial fulfillment of the requirements
of the two years
Full-time Post Graduate Diploma in Management.
Submitted by: UJJAL BANERJEE
Post Graduate Diploma in Management (Marketing)
Roll No: 2K91/M/62
Session: 2009-2011
ASIA-PACIFIC INSTITUTE OF MANAGEMENT
3 & 4, Institutional Area, Jasola, New Delhi-110025
2
3
4
STUDENT’S DECLARATION
I here by declare that the
Summer Internship Project Report titled
“Understanding Marketing Strategy and Marketing Mix of SAIL-ISP”
conducted at
ISP, Burnpur
Under the guidance of
Mr. M.K.A. Khan, DGM (Marketing)
From 12.04.10 to 05.06.10
Is my original work and the same has not been submitted for the
Award of any other Degree/ diploma/ fellowship or other similar titles
or prizes.
Place: Asansol Name: Ujjal Banerjee
Date: Roll : 2K91/M/62
5
ACKNOWLEDGEMENT
I am very thankful to my Institute Asia-Pacific Institute of
Management, New Delhi for having prescribed an Internship and a Project as a
part of the two year Post Graduate Diploma in Management (AICTE approved)
full time course.
I would also like to convey my sincere gratitude to “SAIL-ISP,
Burnpur” and all the people there for having given me the opportunity to be a
part of their esteemed organization. I also thank all the other people who helped
make me to this project possible.
I would specially like to thank my Project Guide Mr. M.K.A. Khan
(DGM-Marketing) of SAIL-ISP, and my faculty guide of my institute, Dr.
Mamta Kumari for their valuable guidance, time and patience, without whom,
this project would not have been a success. I would also like to thank AGM
(HRD) Mr.A.K.Mondal, Training Officer Mr. S. Roychowdhury & AGM of
(Sales & Order) Mr. A.K.Das of “ISP, Burnpur”, for giving me the chance in
this project & for their valuable suggestions and insights.
And I would also like to thank Mr. D.K. Banerjee, (Director) of Asia-
pacific Institute of Management, New Delhi for continuous guidance and support.
And finally, I am thankful to all my friends, my family and all the staff members of
“ISP, Burnpur”, for cooperating with me at every stage of the project. They acted
as a continuous source of inspiration and motivated me throughout the duration of
the project by helping me a lot in completing this project.
Thank you everybody.
Ujjal Banerjee
2K91/M/62
6
Executive Summary
SAIL, Steel Authority of India Ltd., a Maharatna Company is a Public Sector
Unit is a real Steel Giant in India. It has five integrated steel plants within it, among
which one is the IISCO Steel Plant, at Burnpur.
IISCO Steel Plant was amalgamated with SAIL in February, 2006. The plant is
set to undergo-modernization-cum capacity expansion through which its hot metal
production capacity will be raised to 2.5MT by 2011-12.
The modernization programme is going on with full pace and is likely to
commence from 2012 after which its production capacity will be double with lesser
number of man power.
In ISP-SAIL, I was assigned the task to find out the different marketing
strategies which is being used in this company and also the marketing mix of ISP-SAIL.
In this report there is the whole marketing procedure which is being followed.
All the prime steel products are being marketed directly by Central Marketing
Organization, and the Secondary and by-products are being marketed by the respective
plants producing it.
I was given the role of observer by ISP Burnpur. My role was to collect
information about the strategies used by ISP to market its secondary products and also
to understand the Marketing Mix of ISP Burnpur, as a Management Trainee.
From this project, I have got an amazing live experience. As I am a fresh
Graduate, so I do not have any type of experience in a corporate work field. So, when I
went to different types of departments in ISP for asking about their way of conducting
their process, I was enjoying. I was quite surprised because of their friendly behavior.
Moreover during my plant visit programme, I was really thrilled to see the different
methodologies that are used to produce the material which is a necessary product in
every bodies life and also for a growing nation, i:e STEEL.
I am also really greatful to work with many officers in the Marketing
department, where I got my first practical knowledge in the field of marketing. I was
really excited to apply my theoretical knowledge in practicality.
7
In the report, I have prepared two questionnaire formats, one for the executive
staff members and the other for the potential customers of ISP-SAIL. All the details of
interpretation have being discussed in the report.
The actual results came out after preparation of the questionnaires and really it
helped in sketching out a full detailed picture of the whole programme going in the
company.
8
Table of Contents
Serial No. Subject Topic No. Page No.
1. Brief history of SAIL-IISCO Steel Plant 1 10
2. General Overview of SAIL-ISP 2 11
3. Functional Departments
Facilities at ISP-SAIL
Other Facilities
Other Supporting Units
3
3A
3B
3C
13
14
23
23
4. Expansion Programme
Production Plan
New Technology used
4
4A
4B
25
26
27
5. Marketing Mix of SAIL-ISP 5 33
6. Marketing Setup of ISP-SAIL
Before & After Merger
Organizational Structure
Marketing of Secondary Products
Sales Procedure
Marketing Process
Central Marketing Organization
Procedure of Order Procurement
Distribution Network
Handling Customer Complaints
6
6A
6B
6C
6D
6E
6F
6G
6H
6I
40
41
42
43
43
44
47
49
50
52
7. Discussion on Training
Contribution
Research design & Methodology
Data Collection Methods
Question for Understanding
Marketing Strategies
Analysis of data from
questionnaire prepared for customers
Summary Findings
7
7A
7B
7C
7D
7E
7F
53
54
55
56
58
62
67
9
8. Limitations 8A 68
9. Observations 8B 68
10. Suggestion 8C 69
11. Conclusion 9 70
12. Bibliography 10 71
13. Appendix 11 72
10
1. IISCO STEEL PLANT-A BRIEF HISTORY
The origin of IISCO can be traced to 1874 when James Erskin founded the
Bengal Iron Works and set up a plant at Kulti (West Bengal) to produce pig
iron. Operations started with the help of two Blast-Furnaces.
In the year 1890 the third blast furnace came up and Martin and Company was
appointed as Managing Agent.
Kulti set its fourth blast furnace and the managing agents established IISCO at
Hirapur (Burnpur)-West Bengal in the year 1918.
BIW merged with IISCO in 1936.
In 1939 steel production at Burnpur started with a capacity of 2.5 ton of steel
ingot.
By the mid 1960‟s the plant under the chairmanship of Industrialist Sir Biren
Mukherjee was producing 1 million ton a year.
Government of India took charge of the company on July 4 1972.
In March 1979-it became a wholly owned subsidiary of SAIL.
IISCO continued to incur losses in spite of financial and other supports from
SAIL and the Govt. due to its high cost of operation, obsolete technology and
ageing equipments.
Referred to BIFR on June 22, 1994.
Installed First Twin hearth Furnace in 1999 to reduce cost of production of
liquid steel
Rehabilitation proposal submitted to BIFR in 2002 led to closure of Kulti
Works
On 20.11.03, total investment of Rs. 341 cr was sanctioned to sustain
production.
On June 16, 2005 union Cabinet approved the proposal for merger of IISCO
with SAIL.
IISCO amalgamated with its parent company on February 16, 2006 and thus
became the fifth integrated steel plant under this PSU Steel giant “SAIL” and
renamed as “IISCO Steel Plant (ISP)”.
11
2. SAIL-IISCO STEEL PLANT, Burnpur
A general Overview of the entire plant:
IISCO STEEL PLANT (ISP) is an integrated steel plant in Burnpur. It has the
capacity to produce 4.26 lakhs of saleable steel and 2.54 lakhs tones of pig iron
annually. Earlier INDIAN IRON AND STEEL COMPANY (IISCO) was a
100% subsidiary of STEEL AUTHORITY OF INDIA LIMITED (SAIL) - has
been amalgamated with the parent company with effect from16th February
2006.
ISP produces a large number of steel structurals and special sections as well as
pig iron. It is this plant which pioneered the production of center – special Z-
section used in the fabrication of wagon and Z-type sheet pilling section used in
construction of barrages, bridge foundations and other projects and colliery arch
section used for roof support in collieries. The plant has also developed “slit
rolling” for small diameter rounds (10mm and 12mm), which are in high
demand in the domestic market.
The plant is set to undergo –modernization - cum capacity expansion through
which its hot metal production capacity will be raised to 2.5MT by 2011-12.
ISP is accredited with ISO – 9001: 2000 QMS for its Heavy Structural Mill and
Merchant and Rod Mill. It has also been awarded ISO 14001: 2004 EMS for its
entire Rolling Mill Complex.
ISP is situated at Burnpur near Asansol in the Burdwan district of West Bengal.
The Coke Ovens in ISP will be declared IMS and will be accredited 9001 (for
quality control), 14001 (for environmental control) and 18001 (for safety and
control).
The modernization work is going on with full pace and is likely to commence
from 2012, where production will be around twice that is being produced and
with a lesser number of manpower.
12
IISCO’s Vision Statement:
To be a prosperous and respected world class corporation and the
leader in Indian Steel Business in terms of Quality, Productivity and Customer
Satisfaction, Cost and Delivery of products and services.
Quality Policy:
IISCO is a quality company committed to build and sustain itself
as an organization which is customer oriented, innovative and where excellence is
achieved in every function through continual improvement.
It is a company, committed to quality products and services for total customer
satisfaction and achieves market leadership through continual improvement of
processes and systems by active involvement of all employees.
The broad guiding principles of IISCO, Burnpur are as follows:
Build up customer confidence through meeting the requirements of the
customers.
Quality is achieved by involvement and commitment of every individual of
the organization.
Quality is built into the process by installing a quality management system
with defined objectives which are reviewed for continuing suitability.
13
3. FUNTIONAL DEPARTMENTS OF THE ORGANIZATION
The organization has five major parts in its department. They are as follows-
Finance Department: The main & important function of this department is to
control & monitor all the financial transaction of an organization.
Marketing & Sales Department: The important function of this department is to
handle all kinds of marketing & sales related matters regarding the product of an
organization.
Human Resource Department: The major function of this department is to
select, recruit, transfer of staffs & handle all types of problems regarding staffs
in the organization.
Information Technology & Systems: The main function of this department is to
handle all types of problems in an organization technically & systematically.
Logistics & Legal Department: The main & important function of this
department is to protect the company or organization from illegal activities, &
obviously provide suggestions that how to solve problems in a legal & proper
way.etc.
Other Functional Areas
There are quite a number of other functional areas, which play a very vital role
to meet the various needs of the plant as well as its employees. They are as here under: -
Personal Department
Material Management Department
Medical Organization
Education Department
Town Administration
Purchase
Public Relation Department
Production Planning & Control Department
14
These departments cater to the various needs of the plant personnel such as
salary, finance, personnel grievance, education, hygienic sanitary condition, good living
environment, selling the product & purchasing from outside parties, production
planning, training of manpower etc.
3A. Facilities/Infrastructure at SAIL-ISP, Burnpur
Coke Oven Plant:
The main functions of Coke Ovens are:
To produce Coke from Coal.
To supply coke to blast furnace.
To meet energy requirements of various departments of ISP by supplying coke
oven gas.
To recover valuable coal chemicals.
The main raw materials which are used are:
Coal, which is procured from the different places.
The different types of coal and procurement areas are as follows:
Primary Cooking Coal- from Chasnalla, Moonidih, Kakani, Bojudih, etc.
Medium Cooking Coal- from Bokaro west, Kedla, Swang, Kargali, Begunia,
Mohuda, Kathara.
Blendable Cooking Coal- from Chinakuri and Ramnagar Depots.
Imported Cooking Coal- from Broken Hill, South Australia through Haldia,
Paradwip and Vizag ports.
Coke ovens consist of the following sections:
Coal handling Plant
Batteries (2 nos.), 10 no. battery in being re-modified.
Heating Section
Coke handling Plant
By-product Plant
Refractory sections
15
Process:
Coal is received by trucks and wagons and then stored separately sources wise
in Stockyard.
It is then reclaimed from yard and is then processed in the coal preparation unit,
finally sent to the batteries through coal charging car (capacity of 20 tonnes of
coal at one time).
Here high temperature carbonization is done, i:e heating in the absence of air.
During this method, volatile matters are removed leaving behind residual mass,
Coke.
This coke is pushed out of ovens through Pusher car, quenched by water and
sorted out for different fractions in the Coke handling plant.
Coke oven gas is then passed through different recovery processes in the by-
product plant to get Coal chemicals.
Output:
Primary Output:
Hard Coke (25-80 mm)
Nut Coke (20-40 mm)
Pearl Coke (12-25 mm)
Fines Coke (0.12 mm)
Coke oven gas (used as an important
fuel in boilers, SMS, reheating
furnaces, Rolling Mills, etc.)
Secondary Output:
Coal tar
Dehydrated Tar
Ammonium Sulphate (used in
Fertilizer industry)
Naphthalene
Benzene products
16
Blast Furnace:
The main Functions of Blast Furnace are:
To produce Hot Metal (Iron) and PIG Iron from all the raw materials.
To produce Slag used in Cement factory.
The main raw materials which are taken as input are:
Iron Ore from Gua, Manoharpur, Bolani, and Barsua iron ore mines.
Limestone from Kuteshwar, Bhawanathpur, RSMNL depots.
Dolomite from Bisra, Tulsimar, Bhiringee, Srirum, Jigmi, etc.
Link Dolomil Slag from SAIL fraternity plants DSP and BSL.
Coke from Coke Handling Plant inside the plant.
Equipment:
Blast Furnace consists of four furnaces, out of which two are running now of
production capacity 600 tons/day and 1200 tons/day. It also consists of Blast Furnace
Stoves, Cast House, Ore handling Plant, Ladle House, Slag Bank and Gas cleaning
plant.
Process:
Blast Furnace is the most important part of iron section.
All the materials are put inside the blast furnace through the stripper cars in
COOCC charging sequence.
Hot air is injected into the furnace which reduces the iron ore into Molten Iron
at around (800-1300)*C and settles down at the bottom being heavier and the
Slag which is formed by reduction of the raw materials settle at the top of the
hot metal.
After that first the Slag is collected and then the hot metal is collected by two
different notches.
The whole process is controlled by software „PLC‟ (Process Logic Control).
Through this software, different instructions are given for the charging process.
17
Output:
Pictures of Blast Furnace:
Primary Products Produced:
PIG Iron
Melted Iron
By-Products Produced:
Silicon and Calcium Oxide,
known as SLAG used in
cement factory.
Aluminum Trioxide
Blast Furnace gas.
18
Steel Melting Shop:
The main function of Steel Melting Shop is:
To convert PIG Iron coming from Blast Furnace to molten Steel by
segregating the unwanted materials.
The main raw materials which are required are:
Melted Iron
Dolomite
Coke Breeze
Ferro Alloy
Limestone
Scrap
Oxygen
Manganese ore
Equipment:
Steel Melting Shop consists of two Twin Hearth Furnaces, one Mixer, casting
area, ladles, Ingots mould, etc.
Process:
Molten Hot metal from Blast Furnace is sent to the twin hearth Furnace
(comprising of two hearths, one left and one right; all under one roof.)
To heat a maximum of 1680*C is needed. When any one of the Hearth is full, a
certain amount f gas is let through specific outlets known as, „gates‟.
Each hearth comprises of specific pipes called „lungs‟. These lungs have two
pipes, one carries oxygen and the other contains water which helps to maintain
the normal temperature of the lung pipes and prevents them from bursting.
The pure form of steel is collected in „Thimbles‟. Then it is poured into the Ingot
Mould which after solidification moves to the rolling mills.
The scrap form is collected in ladles. The slag produced is of two types, one is
used in making Cement, and the other is of no use but contains minerals (mainly
Iron), which is sorted out and sold in the market.
Blast Furnace at ISP, Burnpur
19
Output:
Primary products consist of Steel Ingots. Around 220 MT of Steel is produced
in a single working day.
Secondary products consist of Slag used in cement industry.
Pictures of Steel Melting Shop (SMS)
20
Rolling Mills:
The steel produced in the plants as discussed earlier would be of no use if it is
not given a final shape by making it a final finished product. Therefore, Rolling Mils is
the ultimate plant where the ingot is given a final shape.
It comprises of different sectors, which are as follows:
Soaking Pits (32 nos.)
Blooming Mill (0.9 Mtpa)
Billet Mill (0.25 Mtpa)
Heavy Structure Mill (0.25 Mtpa)
Light Structure Mill (0.12 Mtpa)
Merchant Mill (0.15 Mtpa)
Blooming and Billet Mill:
Input material: Steel Ingots produced in Steel Melting Shop.
Output Material: Blooms, Slabs, and Bloom Blanks, Billets.
Use of this Mill: the products generated in this Mill, forms the inputs of Heavy
Structure, Light Structure and Merchant Mill.
Process: The steel ingots are first soaked in soaking pits for attaining a rollable
temperature. After that these ingots are rolled in between two rollers under high
pressure where the ingots get converted into long blooms.
Pictures:
21
Heavy Structure Mill:
Input Material: Blooms and Bloom blanks.
Output Material: The range of products comprises of Joists, Channels, Angles,
Heavy Rails and special sections like Z-bar, Z-Pilling, Colliery Arch, etc.
Pictures:
Light Structure Mill:
It is also known as Morgan Mill, as it was set by Morgan and Company.
Input Material: Billets and Blooms.
Output material:
Rounds, used in Re-rolling Mills as axes, spindles.
30 lb Rail, a unique section used in Colliery for rolling trolleys.
Process:
The processesing includes various stands like roughing, intermediate and
finishing, cooling and straightening. The standard length is 10 metres and above.
Pictures
22
Merchant Mill:
Input Material: Billets imported from DSP and from Billet Mill
Output material: Plain Rods (of size 16mm to 40mm) and TMT rods (of size 16mm
to 32mm).
Process:
In the Merchant Mill, the billets which are received are generally 100sq.m. and
of 8.8-9 m in length. The cold billets are made usable through a reheating furnace.
There are 10 burners in the furnace. The various stages are housing, roughing,
intermediate and finishing.
Pictures:
23
3B. Other Facilities:
Pollution Control:
All environmental parameters like SPM, SOX, NOX, water testing are regularly
undertaken to meet the Pollution Control Board norms. The department is equipped with
latest testing facilities.
Computer Services:
Computerized Integrated Maintenance and Materials Management System
(IMMMS) based on CA-Open Ingres RDBMS under HP-UX. A Sun Solaris network running
Oracle RDBMS in Finance department. Email and internet facilities.
Education:
ISP runs 3 Higher Secondary, 1 Secondary and 4 Primary schools providing
subsidized education to more than 7000 students. Besides, 1 co-educational English
medium CBSE school with 2000+ students is supported by the company.
Health Care:
A 500-bedded Central Hospital with facilities like modern OT, ICU, ICCU, Dialysis
unit, Dental, isolation ward, blood bank, physiotherapy. Besides, there are Clinics in all
townships and Occupational Health Centre in the plants.
3C. Other Supporting Units:
In addition to production units the plant has a score of supporting units, which
cater to the need of technical service of production departments. The various supporting
units in SAIL-ISP are as follows: -
Refectories
Heavy Maintenance Shop
Electric Repair Shop
Captive Plant
24
Plant Designing & Drawing Department
Loco Repair Shop
Wagon Repair Shop
Traffic
Telecom
Industrial Engineering Department
Instrumentation & Research & Control Laboratory
These departments help the plant run smoothly with rendering the services
whenever needed. These departments work in conjunction with the works department
for overall favourable growth in productivity of the plant. These departments provide
auxiliary services and materials to production department of the plant for efficient
functioning, without disrupting the smooth operation.
25
Expansion Programme of
SAIL-ISP, Burnpur
26
4. Expansion Programme
4A. Production Plan under Expansion Scheme {Mtpa}
Product
From Existing
Stream
From New
Stream
Total
Hot Metal
0.21
2.70
2.91
Crude Steel
-
2.50
2.50
Saleable Steel:
-Heavy Structurals
-Light Structurals
-Wire Rods
-TMT & Rounds
-Billets for Sale
TOTAL
0.15
0.10
-
0.18
-
0.43
0.60
-
0.50
0.75
0.09
1.94
0.75
0.10
0.50
0.93
0.09
2.37
PIG Iron
0.18
0.13
0.31
Representing the above data graphically:
27
4B. New Technologies
Base blending of Raw Materials
Tall Coke Oven Battery with
Coke Dry Cooling Plant
Computerized Combustion Control System
Selective Crushing Facility
All Pollution Control Measures
Sinter Plant for 80% Sinter Charge
Blast Furnace of large volume with top pressure recovery turbine
Torpedo Ladles to transfer Hot Metal of BOF
BOF for Steel making
Concast with Billet & Beam Blank casters
Universal Heavy Section Mill with Tandem Reversing Rolling
Wire Rod & Bar Mill with high speed finishing blocks
Main Technological Units
1. Coke Oven Battery with Gross production of 0.78 Mtpa
2. Sinter Plant (2 Nos.) with gross production of 3.8 Mtpa
3. New Blast Furnace with a Huge Volume of 4060 cu.m. which will produce Hot
Metal at a capacity of 2.6 Mtpa
4. Steel Melting Shop
3 Nos. BOF- Each of capacity 150 tomme
Liquid Steel production around 2.6 Mtpa
5. Continuous Casting which compromises of Billet caster of production capacity
of 1.67 Mtpa and a Beam Blank caster with production capacity of 0.8 Mtpa.
6. Rolling Mills, which comprises of a Universal Heavy Section Mill of capacity
0.6 Mtpa and a Wire Rod & Bar Mill of capacity of 1.25 Mtpa.
28
Proposed Modernization /Expansion Plan of ISP
SAIL Board accorded stage-I approval on 28.07.2006
MECON appointed as Consultant
Open/Global Tender Enquiry for 22 nos. major packages issued from
August‟2006
Based on the prices firmed-up, proposal was up for consideration of SAIL
Board
As per directive of SAIL Board on 05.09.2007-
LOA placed for 16 nos. packages
Contract signed for 16 nos.
6 nos. package re-tendered with required re-packaging.
Approved updated cost (net of CENVAT)- Rs. 14,443.20 crore
Environmental clearance for the project obtained from MoEF on 07.08.2007.
29
Expansion of SAIL-IISCO STEEL PLANT
SL.No.
Name of Package
& Package No.
Name of the Party
Effective
date of
Contract
Comple
tion
Time
In
Months
Completion
date
Total
Evaluate
Cost (Rs.
In Cr.)
1.
Coke Oven
Battery(02)
Giprokoks,
Ukraine(Leader)
McNally Bharat Engg,
India
Bhilai engg. Corpn,
India
13.10.07
29.5
27.03.10
537.53
2.
By-Product
Plant(05)
McNAlly Bharat, India 12.10.07 29 11.03.10 231.31
3. Sinter Plant(06) L&T, India & Outotec
Germany
13.10.07 29.5 28.03.10 704.19
4. Blast Furnace(07) POSCO, South Korea 16.10.07 30 15.04.10 1493.50
5. Coal
Pulverization and
Injection
System(08)
CISRI, China,
Shapoorji Pallonji,
India
13.10.07 24 12.10.09 78.79
6. Pig Casting
Machine(09)
METCO, India 09.10.07 24 08.10.09 48.26
7. Hot Metal
Handling
System(10)
Dailan Huarui, China
and Simplex Engg.
14.10.07 24 13.10.09 71.91
8. Continuous
casting
System(12A)
Siemens VAI, Austria
& India
11.10.07 30 10.04.10 447.93
9. Universal Section
Mill(14)
SMS MeerGmbH,
Germany Siemens Ltd.
India
13.10.07 24 12.10.09 696.49
10. Reheating
Furnaces(15)
Bricmont Inc, USA &
Gillanders Arbuthnot,
India
11.10.07 24 10.10.09 167.65
11. Wire Rod & Bar
Mill(16)
Danielli &C, Italy &
Shriram EPC, India
13.10.07 26 12.12.09 698.97
12. Oxygen Plant(17) Linde Germany, BOC
India
12.10.07 27 11.01.10 377.99
13. Top Pressure Beijing Sino-Steel, 13.10.07 24 12.10.09 41.73
30
Recovery
Turbine(18)
China and MICCO
India
14. Power & Blowing
Station(19)
BHEL India 12.10.07 26 11.12.09 672.66
15. Main Receiving
Station(21)
ABB Ltd, India 09.10.07 24 08.10.09 63.03
16. BOD Plant(27) UPL Envt. Engg, India 12.10.07 28 11.02.10 8.26
17. Ore Handling
Plant(01-A)
McNally Bharat, India 06.03.08 26 05.05.10 534.55
18. Coke Handling
Plant & Pipe
Conveyers(01-B)
L&T, India 07.03.08 26 06.05.10 505.54
19. Base Mix
Handling
Plant(01-C)
L&T, India 07.03.08 26 06.05.10 457.50
20.1 Wagon Tripplers
& SAC(01-D Gr-
I)
Elecon Engg., India 07.03.08 26 06.05.10 26.39
20.2
Stackers &
Bucket Wheel(01-
D Gr-II)
Elecon Engg, India
07.03.08
26
06.05.10
77.72
20.3 Barrel Reclaimers
& Transfer
Cars(01-D Gr-III)
Elecon Engg., India 07.03.08 26 06.05.10 60.88
21. Basic Oxygen
Furnace(11B)
SMS DEMAG
Germany
19.03.08 29 18.10.10 1120.08
22. Lime & Dolomite
Plant(13A)
Cimprogetti, Italy F.L.
Smidth, India
18.04.08 24 23.04.10 105.82
23. Civil Work for
BOF, CCP and
L&D Plant(48A-
1)
Shapoorji Pallonji,
India
24.05.08 24 31.10.10 199.63
24. Structural Work
for above(48A-2)
Nagarjuna
Construction, India
22.05.08 22 29.01.11 278.91
25. Civil Works for
Rolling Mills &
Reheating
Furnace (48B-1)
Shapoorji Pallonji,
India
24.05.08 22 21.04.10 184.60
26. Structural work Nagarjuna 22.05.08 20 02.05.10 192.88
31
for Rolling Mills
& Reheating
Furnace (48B-2)
Construction, India
27. Hot Metal
Desulphurisation
(11A)
Kuttner GmbH, India 04.06.08 24 03.06.10 37.26
28. Secondary
Refining
System(11C)
SMS India, SMS
Mevak, USA
23.05.08 28 22.09.10 215.19
29. EOT Cranes(11-
01A)
Anupam JSC , Russia 04.06.08 24 03.06.10 186.30
30. Coke Dry Cooling
Plant (03B)
Giprocks, Ukraine
Bhilai Engg, India
16.07.08 24 15.07.10 307.37
31. Add. Civil Works
for
BOF,CCp,LDCP
& Rolling Mills
L &T, India 14.03.09 12 13.03.10 211.67
32. Add.Strctural
Works for BOF,
CCP, & LDCP
Simplex Infrastructure 11.08.09 11 10.07.10 115.66
TOTAL 11183.64
Therefore it is very clear that after the plant is fully expanded and run with its
full capacity, the production and despatch figures in the upcoming years will be in a
high tide which will definitely increase the market turnover ratio over previous years.
Moreover, it will gradually turn out to be an “integrated Steel Plant” where all
the products produced will be of high quality and all the by products and scraps will be
fully recycled inside the plant, hence decreasing the volume of wastage to a large
extent. In other words, waste product of one plant will be raw material of the other
plant.
32
Marketing Mix of SAIL
and
IISCO Steel Plant, Burnpur
33
5. Marketing Mix of ISP-SAIL
Product Mix in altogether of ISP, Burnpur
IISCO produces a wide range of steel products which also include some special
sections. While Steel products of varying specifications are available one need not to go
elsewhere to get castings and spun pipes of high quality. Then there are products like
Pig iron, coal chemicals, coal, iron ore, coke fractions, slag and scrap and also
secondary products or by-products.
First of all Blooms, Billets and Slabs are produced from the Steel ingots in
different Structural Mills.
Then different structurals are made all of different sections, such as:
Equal Angles
Unequal Angles
Beams
Rounds
Cold twisted Deformed Bars
Channels
Rails
SAIL-TMT Bars
SAIL-ISP, Burnpur at present is the sole producer of the following Prime Steel
Special Sections:
‘Z’ Section bar
‘Z’ Section Pilling
Colliery Arch
Joists
Orders of Prime Steel Sections are accepted in IS-2062 Grade A or B, IS-961,
IS-8500 and SAILMA Quality. Materials are also supplied in Micro Alloy quality and
to works tested specification by mutual agreement with the customers. Structurals are
also available with addition of Copper. Particulars of Sizes, specifications and other
details can be furnished at the time of accepting orders.
Pig Iron: Foundry Pig Iron for general purpose are available for steel making is
available in SAIL grade 1 and 2, with respect to low manganese content.
34
Moreover there are a huge number of Secondary products starting from Coke
Production to finished Steel Production in different units.
The different types of Secondary and By-products are as follows:
Light Solvent Naptha
Benzene
Toluene
Whizzed Naptha
Coal Tar
Benzol
Ammonium Sulphate
Steel Crop ends
Skull and Scrap
AREAS OF APPLICATION OF IISCO PRODUCTS
IISCO products have a very well spread market. A high demand for these
products is seen because of the quality of its products and IISCO‟s commitment
towards its customers. The demand of the products is observed in the following areas
of work.
Construction of Bridges
Construction of Roadways
Construction of Ships
Construction of Railway wagons and Railway platforms, Pillars and
Posts
Construction of Industrial plants, building flats
35
USAGE OF SECONDARY AND BY- PRODUCTS OF ISP
Secondary Products Uses
Light Solvent Naphtha It is usually used in Paint and Varnishes
Benzene Used as DDT; used as raw materials for various
drugs and for discovering rubber; used in Resin
intermediates; used to prepare Benzene Hex
chloride which is a pesticide.
Whizzed Naphtha Generally used to manufacture white naphthalene
balls.
Coal Tar
Used in tar distillation products; also used as
electrodes to be used in Aluminum industries.
Benzol Used as a solvent in dye and paint industries.
Ammonium Sulphate Brand
Name “Raja”
Used as an excellent fertilizer.
Toluene Used as a thinner in the dye and paint industry.
Crop ends Sent to the Steel Melting Shop for further
processing and making steel.
Slag
Used as a raw material in the Cement industry.
Cobbles (Heavy Rail Spoils)
Either sold away to the outside parties or they are
again sent to the Steel Melting Shop for further
processing and making steel.
SAIL-ISP uses Colour Codation Methodology for segregating their products
according to their quality. The basic Colour Codes are:
RED (For Defective material)
WHITE (For Off Grade material)
GREEN (For Prime Products of A and B grade, which are to be
marketed by Central Marketing Organisation).
36
Pricing Strategy used by SAIL
Since marketing of Prime Steel Products are marketed by Central Marketing
Organisation (CMO), it has its own strategies to fix the price of the products.
It has its Marketing Research team who generally focuses on the world wide
Steel dynamics to follow the trends in the industry in a sequential pattern. Then it
prepares a report and sends it to the four different wings of CMO, namely
Technical Wing (which deals with the customers not technically
satisfied)
Commercial Wing (which deals with the problems of deviation of the
product from the assured quality)
Product Deviation Wing (new product development wing)
Pricing Committee. (which deals with setting the price of the prime
products.)
The pricing committee is headed by the Director of Commercial, SAIL-Delhi
along with two Executive Directors of Long Products and Flat Products
respectively. Then there are Four Regional Managers who are generally General
Managers. Then the Base price is fixed after considering railway freight, excise,
handling and stockyard expenses, which helps to earn good revenue. Liberty is
given to each and every branch managers for putting forward their options and
everything in the process is audited.
Pricing of the Secondary and By-Products are set by the respective plant
producing these items and has its own pricing committee.
Place
Being a “Maharatna” Company, SAIL has a very huge distribution network
along the whole country.
It has Five integrated Steel Plants, which are:
Bhilai Steel Plant
Bokaro Steel Plant
Durgapur Steel Plant
Rourkella Steel Plant
IISCO Steel Plant
37
It also has a Special Steel Plant known as ,”Alloy Steel Plant” in Durgapur.
Subsidiary units under SAIL in Maharashtra Elektrosmelt Ltd, which is the largest
Manganese, based Ferro Alloy Producer.
Other unit of SAIL is the SAIL Consultancy Division (SAILCON), which is a
single window in SAIL catering to clients across the world, providing design,
engineering, technical, management, and training consultancy and service available
from various Sail plants and units.
Promotion
SAIL still lags behind when it comes to promotional activities. It does not follow
dynamic ways of promotion. There is Public Relation department, which takes care of
promotional activities. They take help of leaflets, hoardings, handouts.
Sail Hoardings and posters are now seen in all the walls of trains and highways, buses.
Campaigns are being scheduled in rural areas to attract the rural customers to use these
products for their small requirement. Online add is also being used.
People
SAIL generally has a market all over the country and is with dealings with many
huge construction and other organizations. But now it is trying to capture the rural
market also. The rural people usually have very little use and according to a survey, the
rural consumption of Steel is only 2 kg o an average. For this purpose SAIL has started
a programme to install around 1800-2000 shops all over the rural districts of India,
where the rural man can come and have their daily requirement as per their choice.
IISCO Steel Plant also has a number of rural customers for its by-products and
secondary products. The customers are:
Adhunik Company (Kolkata)
Swarnamangalam Company (Durgapur)
Steel Centre (Punjab)
Banik Punching Works
Meera Traders
Burnpur Iron Foundry
Ma Lilori
38
Production Performance
Here is a tabular presentation of production(Tonnes) in SAIL-ISP over a
span of Five years:
Period Hot Metal
Production
Pig Iron
Production
Ingot Steel
Production
Saleable Steel
Production
2005-06 7,79,560 2,12,928 4,33,522 3,13,796
2006-07 7,75,266 1,68,394 4,69,323 4,03,196
2007-08 6,39,800 93,352 4,58,221 4,11,970
2008-09 5,97,729 97,766 4,16,556 4,02,390
2009-10 5,02,133 36,583 4,00,029 4,13,939
39
Product Mix Summary of Saleable Steel over a period of Five years:
Products 2005-06 2006-07 2007-08 2008-09 2009-10
Semis (Blooming & Billet Mill) 65,817 88,033 96,877 83,738 84,601
Bars & Rods (Merchant Mill) 83,818 1,21,466 1,33,229 1,33,285 1,38,344
Heavy Rails (H. S. Mill) 8634 5791 2430 1569 185
Light Rails (L. S. Mill) 6486 6405 2964 2598 3309
Structurals (HS, LS,& M. Mill) 1,27,119 1.,60,446 1,56,058 1,63,513 1,75,246
Special Sections (H.S. Mill) 21,922 21,055 20,412 17,688 12,254
Total Saleable Steel
3,13,796
4,03,196
4,11,970
4,02,390
4,13,939
Despatch Summary of Saleable Steel for a period of Five years:
Products 2005-06 2006-07 2007-08 2008-09 2009-10
Semis 66,616 88,087 91,620 73,935 86,492
Structurals including Hy.rails
& Sp. Sections
1,47,353 1,80,230 179,779 1,72,460 1,88,367
Bars & Rods 80,473 1,21,306 1,33,524 1,31,990 1,39,790
Light rails 6,261 6,192 2,899 1,129 2,189
Total Steel Dispatch
3,00,703
3,95,815
4,07,822
3,79,514
4,28,967
Comparing Graphically Steel Production with Dispatch:
40
Marketing Set up
at
SAIL-IISCO Steel Plant,
Burnpur
41
6. Marketing Set up of SAIL- IISCO Steel Plant
6A. “Before Merger with SAIL”
IISCO had merged with SAIL on 16/02/2006 and has started its operation as ISP
from 01/04/2006 onwards. Before its merger, IISCO had its own marketing set up.
It had its country wise marketing network with headquarters at Kolkata and
branch offices all over India. IISCO had CSO (Central Sales Organisation) at Kolkata
and branch sales offices at the respective places:
Bangalore
Bhubaneshwar
Chandigarh
Ludhiana
Mumbai
Burnpur
Kolkata
Chennai
Hyderabad
New Delhi
The CSO was responsible for co-ordinating between the branches, planning, and
production and for organizing dispatches.
The marketing policy was directed towards maximizing the NSR (Net Sales
Realization) and to generate revenue for the organisation.
“After merger with SAIL”
After the merger of IISCO with SAIL, things have changed drastically. Now the
entire marketing activities for the primary products of ISP are dealt by CMO (Central
Marketing Organisation). The body of CSO has been dissolved. The earlier branch
offices of IISCO have merged with SAIL. Now marketing activities of ISP is only
restricted secondary products and scrap items inside the plant.
Not only ISP, but all other integrated steel plants under SAIL follow the same
marketing pattern. Thus the competition between the sister plants does not occur in this
process and hence they perform their individual duties which results in proper
functioning and growth of this PSU giant “Steel Authority of India Ltd.”
42
6B. Organizational Structure of ISP Marketing (dealing with
Secondary and Scrap items)
General Manager
(Marketing)
Assistant General
Manager
(Sales and Order) Mr. A.K. Das
Assistant General
Manager
(Sales) Mr. N.K. Kameswar
Junior Manager
(Marketing)
Deputy General
Manager (Marketing) Mr. M.K.A. Khan
Deputy General
Manager (Marketing)
Junior Manager
(Sales and Order) Mr. S. Sukhla
Junior Manager
(Sales) Mr. S. Ghosal
Junior
Manager
(Marketing)
Non-Executive Staff
(Marketing Department)
Operates at SAIL-IISCO
Burnpur
Operates at
Kolkata office
43
6C. Marketing of Secondary products of SAIL-ISP at Burnpur
Like other steel plants under SAIL, Prime Products which are produced in
IISCO Steel Plant is marketed by Central Marketing Organization (CMO) at Kolkata.
And the marketing activities of IISCO Steel Plant restrict itself only with marketing of
Secondary Products.
It is obvious that the secondary products or scrap items cannot be avoided in a
steel plant. ISP is also not an exception to this. Various secondary products and scrap,
rejected items are generated at different stages while finished products are produced
from its raw materials. Secondary products have a separate market segment or
customers. Marketing department of ISP is entrusted to market the secondary product
such as, „Defective steel, by-products like ammonium sulphate, Benzol products, coal
chemicals, coke fractions, etc.‟ and converting them into cash. Therefore at present the
marketing activities for secondary, by-products and scrap items is the sole responsibility
of the Branch Sales office of ISP, located at Kolkata with the name of “IISCO House”.
This organisation takes care of secondary products and carries out e-auctions to sale off
the secondary products.
Here is a list of some of the products which are marketed by ISP-SAIL, Burnpur.
PIG Iron
Granulated Slag
Blast Furnace Coke
Nut Coke
Coal Tar
Ammonium Sulphate
Benzol Products including Benzene, LS Naphtha, Toluene, Motor spirit, etc
6D. Sales Procedure:
The very first step of sales procedure is to fix the price of the product. Pricing
is the most vital aspect of marketing. Pricing policy can make or break a company. If
price is too less, company can earn less than optimal revenue and if the price is too
high, then the company may not earn desired profit.
As we all know that coal chemicals and steel scrap items are the core product
of ISP-SAIL, but for its marketing department, these are the only products to market as
44
the core product or prime saleable steel products are marketed by its marketing hub
„CMO‟.
At present, ISP is the market leader of products like Z-bar, Z-Pilling, Colliery
Arch, Benzene , Toluene, LS Naphtha.
Standing Pricing Committee:
This committee takes the decision to fix the new price list of various items to
be sold in the market. Committee meets at least once a month generally more often in a
month. It is also necessary for the following committee to meet more often because the
price of some products is volatile (i:e Naphthalene). Sometimes, huge imports bring the
price down very quickly and a higher price can be uncompetitive. So regularly price
reviewing is very necessary.
The committee consists of the following members:
GM (Chairman)
GM (Marketing)
DGM (Marketing & Finance)
AGM (Sales & Order)
DGM (Store Member)
Then the products are held for auctioning with the help of “METAL JUNCTION”, a
50:50 joint venture unit by SAIL and TISCO for holding the auction programmes.
6E. The whole marketing process in detail by the marketing
department
The steps which are followed are given below:
The products which are mainly into the auctioning process are the mill scraps,
rejected, unused, left over materials which is accumulated by the Materials
Recovery Department and sent an indant to marketing department for the selling
of those products mentioning all the details of location of the material, its
capacity, etc.
After getting the indant, i:e the list of saleable products, Metal Junction
prepares a tender quotation (setting a price list) and puts it on its site for its
bidders for online bidding on a particular date.
A reserve price is fixed for the same products by setting up a joint committee.
45
First of all the interested bidders have to pay an EMD (Earnest Money
Deposit) which is 5% of the material value for participating in the bidding
process.
A requisite amount of training is given to the respective bidders so that they
can ensure a fair auctioning process.
The bidding process starts on the mentioned date, when all the bidders make
their bid and after the bidding process is over, the highest bidder (H1) is taken
into account.
Now the highest bidding price is matched with the reserve price
If it is more, then it goes for approval process by another
committee comprising of different sets of hierarchical
personals for having a transparent touch and finally
recommended by the GM to finalise the approval process.
If the bid price is less than the reserve price, then re-auction is
done.
After the approval process, offer is made to the bidder making the highest bid
for making the payment within 4 days from the date of offer. After 4 days 3
days grace period is allowed to make payment, only under the circumstances
that have to pay a fine of Rs. 10 per day per tonne.
The payment has to be made through demand draft to the cash section, which
sends it to the SBI Burnpur Branch for checking the auctioning of the drafts.
After checking, they issue the money receipt.
Following, the issuing of delivery order is made (approximately within 2 days
from the date of making payment.) and along with the terms and conditions the
customers along with the lifters will have to follow throughout.
After issuing of the delivery order, the lifter has to issue 3 copies of signed
authorisation letter from the customers according to which the next procedures
are taken forth.
Generally delivery order is not extended, but any DO extension, whenever
required, prior permission is required from GM (Marketing).
Now, once the delivery orders are issued, the job of the marketing department
is to now chase the lifters for completion of the delivery in time.
Against the total DO quantity, 1% extra excess loading is allowed.
46
After loading the trucks, permission from marketing department is required to
convince 60MT weighbridge.
After that, if there is some extra loading, the payment has to be made
accordingly.
After completion of delivery process, customers generally apply to marketing
department for refund of their earnest money deposit (which is generally 5% of
the material value)
For getting their refund, the customers have to submit their original
documents: like Delivery Order, Money Receipt and also a document should be
prepared showing date wise delivery of materials taken by the customers.
After verifying all the documents, the marketing department advices the
accounting department along with the documents submitted by the customers for
refunding the required amount of money.
Hence, all the process from auctioning, bidding and completion of delivery
process comes to an end.
47
6F. Central Marketing Organization (CMO)
CMO serves as the Central Marketing Hub of SAIL where marketing functions
for the various products (especially Prime products) is carried out. To ensure quality
and prompt dispatch of products, CMO keeps in touch with the producing units as well
as with the transport and shipping sectors.
The formation of “Central marketing Organization” was very fruitful as it
prevented the generation of internal competition among the various plants within SAIL.
There could also have been region wise discrepancy, i:e distribution of SAIL products
would not have been proper in certain parts of the country could have been deprived.
SAIL like other companies does not depend on dealers and agents. It has its
own distribution channel. CMO has under its belt 42 branches and Stockyard to deal
with the products. Each steel plant under SAIL has got a SRM (Sales Resident
Manager) who acts as an interface between the plants and marketing of the prime
products.
The head quarters of CMO are at Kolkata and under this Head quarter, there
are 4 regions:
Northern
Southern
Eastern
Western
The different Stockyards of the eastern region are at :
Durgapur
Dankuni
Bokaro
Rourkela
Bhubaneshwar
Guwahati
There is also a Transport and Shipping Department (TDS) which looks after the
transport and shipping of products.
The products are mainly dispatched through 3 docks:
Haldia
Paradwip
Vizag
48
There is also a division known as “Internal Trade Division” (ITD) looks after the export
of products.
The domestic market of SAIL‟s product has two wings:
Long Products
Flat Products
Competitors for „Long Products‟ are RINL and TISCO; and competitors for „Flat
Products‟ are ESAR.
Almost everywhere plant under SAIL manufactures some unique products
such as:
Durgapur Steel Plant – Wheel and Axle
Bhilai Steel Plant – Long Rails
IISCO Steel Plant – Z‟ Pilling and Z‟ Bar.
The above mentioned products have a monopoly market which helps CMO in
various ways to target the different customer segment and thus also have a large
customer target base.
ISP-Sail also is the sole producer of many specialty products such as Z-Pilling
and Z-Bar, and therefore due to its monopolistic nature, SAIL enjoys a competitive
edge over other private or public sectors.
Annual Production Plan:
At the beginning of each year, a Annual Production plan is prepared by CMO
and is according to the capacity is divided among various plants.
Each plant along with the production specification is provided a delivery
schedule within which the products have to be delivered.
The Annual Production Plan is planned at CMO by the Product Manager. In
CMO, a product manager who receives order from all 4 regions, heads each products,
scrutinizes and then modifies the demand, which is finally sent to the plant through
respective Sales Resident Manager.
49
Pricing Policy:
The pricing part is dealt by CMO- it is based on the market conditions and the
cost of production. After considering railway freight, excise, handling and stockyard
expenses; a base price or a listed price is fixed, which helps to earn good revenue.
The process of market generation, informing the respective plants, production
according to the requirement and finally dispatching the finished product involves the
following steps:
6G. The procedure which it mainly follows:
Order Procurement from Branches
Movement Plan
Sales Resident Manager
CMO (Head Quarter at Kolkata)
Regional Office
Product Manager
(For each type of Prime Product)
Production Planning and Control Department
Respective Plant
Stockyard
Dispatch of
materials
50
6H. Distribution Network:
Delivery Order issued from Kolkata sales Office as per Plans
Handed over to Purchaser
Copy of D.O. sent to
Company Department
Copy of D.O. sent to
Purchaser
Verification of
Signature
Purchaser authorizes
transporter
Issue slip to CISF for loading truck
Weighment of Empty Vehicle
Loading vehicle with required material
Weighment of Loaded Truck
Weighment of Loaded Truck
Preparation of Dispatch Particulars
Order Department Finance Department
(Issue of Performa Invoice)
51
6I. Customer Satisfaction
To achieve consistent customer satisfaction, the following steps would be
helpful to SAIL-ISP.:
Consistent Quality
Committed Delivery
Customized Product Mix
Contemporary Product
Competitive Price
Complaint Settlement
Culture of customer service
52
6I. Process Map for Handling Customer Complaints:
Input
Registration
Analysis
Communication
Review for
corrective
action
1. Monthly
quality
complaint
summary
report from
CMO
2. Filled in
Performa for
lodging
quality
complaints
of CMO
3. Others
Registration of
Complaints
Data base
generation
Updating status
Analysis of
product
defects
Dispatch to
concerned
HOD‟s in the
following
manner:
1. Defect
wise analysis
2. Monthly
wise quality
complaint
survey
3. Filled in
quality
complaint
survey
4. Filled in
Performa
from CMO
Review by
respective
HOD‟s
initiating
corrective
and
preventive
actions.
Review of Effectiveness
Review of head of RCL on
the taken complaints
Feedback to concerned
HOD‟s
53
Discussion
On
Training
54
7. DISCUSSION ON TRAINING
STUDENT‟S WORK PROFILE (ROLE AND RESPONSIBILITIES)
Role: I was given the role of observer by ISP Burnpur. My role was to collect
information about the strategies used by ISP to market its secondary products
and also to understand the Marketing Mix of ISP Burnpur, as a Management
Trainee.
Responsibilities: During the period of this project my company (ISP) has given
me so many responsibilities. They are as follows-
Survey,
Collection of data by preparing questionnaires,
Analysis of the situation and Marketing procedures
Reporting to the officer
DESCRIPTION OF LIVE EXPERIENCE
From this project, I have got an amazing live experience. As I am a fresh
Graduate, so I do not have any type of experience in a corporate work field. So, when I
went to different types of departments in ISP for asking about their way of conducting
their process, I was enjoying. I was quite surprised because of their friendly behavior.
Moreover during my plant visit programme, I was really thrilled to see the different
methodologies that are used to produce the material which is a necessary product in
every bodies life and also for a growing nation, i:e STEEL.
I am also really greatful to work with many officers in the Marketing
department, where I got my first practical knowledge in the field of marketing. I was
really excited to apply my theoretical knowledge in practicality.
7A. STUDENT’S CONTRIBUTION TO ORGANIZATION
Gathering the product knowledge of SAIL for its knowledge bank.
Collect the data of actual monthly production and sale of ISP products
and byproducts in every trading.
Help to promote the catalog of ISP as a small part of sales promotion.
Find out the problems that the dealer are facing while selling the ISP
product.
55
Find out the consumer response for the ISP product by asking the dealers
of the relevant product.
Presenting a detailed report on marketing strategies and marketing mix
in ISP-SAIL.
STUDY OF SELECTED RESEARCH PROBLEM
STATEMENT OF RESEARCH PROBLEM
The objective was to find out the marketing mix of ISP-SAIL, and to find out
the marketing procedures followed in marketing of secondary products within ISP-
SAIL.
STATEMENT OF RESEARCH OBJECTIVES
Primary objective
The main objective of field survey during the project was to find out the market
mix of ISP-SAIL.
Find out the different methods by which the marketing of secondary
products are carried out.
The main objective of research was to identify the strategy which is
being used in ISP-SAIL.
Secondary objective
While purchasing the ISP-SAIL products which parameter is most
important for the consumer?
To make a comparative data analytical report for the production and
dispatch of various steel products within ISP-SAIL.
To enhance the knowledge of Iron and Steel products market.
To enhance the knowledge about the marketing set up of a Public Sector.
7B. RESEARCH DESIGN & METHODOLOGY
Research Methodology:
Research methodology is considered as the nerve of the project. Without a
proper well-organized research plan, it is impossible to complete the project and reach
to any conclusion. The project was based on the survey plan. The main objective of
56
survey was to collect appropriate data, which work as a base for drawing conclusion
and getting result.
Therefore, research methodology is the way to systematically solve the research
problem. Research methodology not only talks of the methods but also logic behind the
methods used in the context of a research study and it explains why a particular method
has been used in the preference of the other methods
Research design:
Research design is important primarily because of the increased complexity in
the market as well as marketing approaches available to the researchers. In fact, it is the
key to the evolution of successful marketing strategies and programmers. It is an
important tool to study buyer‟s behavior, consumption pattern, brand loyalty, and focus
market changes. A research design specifies the methods and procedures for conducting
a particular study. According to Kerlinger, “Research Design is a plan, conceptual
structure, and strategy of investigation conceived as to obtain answers to research
questions and to control variance.
Types of research used:
Primary Research - Here the data is collected directly from the respondents
using various data collecting techniques. In this method although the rate of
getting responses and feedback is slower, then also it is much more accurate as
direct conversation with the population is being conducted here.
Secondary Research – It is being done generally with the data already existing
which is been collected by some other person or organization.
7C. Data collection methods:
Primary data:
For primary data collection, I have used different data collecting methods such
as conducting survey interviews, distributing questionnaires, direct observation, and
telephonic interviews with mainly executive officers, dealers, employers, etc.
Secondary Data:
57
It is being collected from different Journals at ISP-SAIL, financial data from
Finance Department, Production and Dispatch data from PPC department at ISP-SAIL,
Burnpur.
Data analysis and interpretation:
Questionnaires (Two sets of it.)
Bar chart
Preparation of report:
The report was based on the analysis and presented with the findings and
suggestions. The sample of the questionnaires is attached with the report itself.
Sampling Methodology:
Details of the sampling methodology, I have made 2 sets of questionnaires, one
for the Executive and Non-Executive staff at ISP-SAIL; and the other for the persons
who are a potential customer with the organization.
Sample unit
Professionals, Business man, Employees and finally customers.
No. of questions in questionnaires for Ex. and
Non-Excutive staff members are :
No. of questions in questionnaires for customer:
No. of question related to ISP-SAIL product:
No. of people met during the research:
No. of respondents during the research:
40
10
03
150
100
58
7D. Questionnaire for Understanding Marketing Strategies
at IISCO Steel Plant- SAIL
Market:
1. What is the market opportunity? What is the market size? Market size with
respect to geography and to industry.
2. How can the market be segmented into logical customer groupings?
3. What are the industry trends that are fueling our success? And what are the
trends that are inhibiting our success?
4. According to you, what is the economic climate now and how will it be in the
upcoming two years?
5. How the economic climate does affect our business?
6. Is the market or our business is affected by seasons and climate? If so, then
how?
Target audience:
1. What marketing segments are we targeting? What segments we are not
targeting?
2. What is our customers‟ primary reason or intention to buy our products?
3. Why would someone prefer our products and offerings versus that offers by the
competitors?
4. Are there any issues or concerns that the target audience might have regarding
this type of product or offering?
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Competition:
1. What categories of competition threaten our success? Prioritize the categories?
2. Which are the companies which poses greatest threat to us? And how do they
differentiate themselves?
3. What tactical elements do they use to that threaten our success?
4. Which competitors have the largest market share within our target market
segments?
5. What are the barriers which we are creating for ourselves to entry into the
market place?
Offering:
1. What need is our offering or product designed to fill? Identify the need for each
target audience?
2. What features and associated benefits does our offering provide?
3. How do we deliver the offerings identified above?
4. Of all these features, which one is of that extra value that differentiates us from
our competitors?
5. What improvements can we make to our offering to better meet customer needs?
6. What new offerings would our customers most like us to develop?
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Sales and Buying Process:
1. What is the process for selling our products? Do we use any of the following
processes?
>Direct Personal Sale
>Direct Online Sale
>Indirect through channels
2. Who is involved, both from our company and from our sales channel partners,
in each step of the sales process?
3. What criteria are used in selecting a vendor or a customer?
4. How do our customers buy our type of products?
5. What purchase process steps do we follow with our customers? Does the
process vary with respect to different vendors? If yes, then how?
Pricing:
1. What are the main criteria which are followed in setting the price of the
products?
2. What is the current price structure? Including discounts, rebates and so on. Do
our customers understand it?
3. Which of the competitors is considered the Price Leader? What is their offering?
4. What can be done to reduce costs without affecting any quality?
5. What is the perceived value of our offering as compared to the price?
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6. What service(s) do we currently include in the price of our product?
7. What industry trends are going to drive prices down? And what are the trends
which are going to drive prices up?
Media:
1. What are the primary forms of communication your competition use to promote
and communicate to your target audience?
2. Is a product catalogue used to promote products and services?
3. What other forms of media have you used in the past to promote products and
services and what has been the success/response rate experienced?
4. Do you currently market over the Internet or have marketing links with other
sites?
5. Do you attend trade shows or other industry events to promote your business?
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7E. ANALYSIS OF DATA from the questionnaire prepared for
the customers along with the graphical representation of the
answers.
Q1. Use of Iron and steel in your life -----------
Extremely Important
Very Important
Somewhat important
Not very Important
Not at all Important.
Q2. Business with ISP -----------
Extremely Important
Very Important
Somewhat important
Not very Important
Not at all Important
.
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Q3. Product quality of ISP-SAIL -----------
Excellent
Very good
Good
Fair
Poor
Q4. Process of buying products of ISP-SAIL -----------
Excellent
Very good
Good
Fair
Poor
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Q5. Price of the products are same as market price -----------
Strongly disagree
Disagree
Neither agree nor Disagree
Agree
Strongly Agree
Q6. ISP-SAIL satisfy your needs and demands ------
Strongly disagree
Disagree
Neither agree nor Disagree
Agree
Strongly Agree
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Q7. ISP-SAIL gives better service than other steel plant ---
Strongly disagree
Disagree
Neither agree nor Disagree
Agree
Strongly Agree
Q8. You will continue buying products of ISP-SAIL for next five years ----
Strongly Disagree
Disagree
Neither agree nor Disagree
Agree
Strongly Agree
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Q9. What is your opinion about ISP-SAIL?
Q10.What is the first word that comes to your mind when you hear the
following?
Steel Industry
IISCO. Steel Plant
Inferences
30% of customer gives importance to price. So it shows that Indian
consumers are very price sensitive. They give more importance to price over the
brand.
26% give importance to brand. So price and Brand matter a lots for the
costumers. And they are also want best brand in best price.
19% to product feature Service 16% and durability 9% Service is also a
big factor for the customer they are less interested in the durability.
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7F. SUMMARY OF FINDINGS
Dealer survey Findings
By calculating the display share we found that in most of store ISP-SAIL
has 50% display share almost all categories.
By the actual monthly sale of particular store we came to know the
capacity of the store and how much product can they sale.
It helps us to know that weather dealer is capable of being a direct dealer
of ISP-SAIL or not and it also helps to find out the new dealer who are capable
of being the dealer of ISP-SAIL.
We also came to know while visiting the shops that there was big
problem of after sale service.
Many dealers were facing the problem of after sale service because there
is no follow up calls from ISP-SAIL.
There is high growth of sale in market due to booming in new
technology and better service.
Word of mouth plays a vital role in awareness among customer. This is
one factor, which can play a good role in promotion of products as well as
demonstration given by the shopkeeper also plays a vital role for customer.
CUSTOMER SURVEY FINDINGS
Secondary products play an important role in the customers mind and
create awareness among the customers. The secondary support includes
Demonstration, Exhibition & Even Sponsors.
Customers want to buy from the showrooms or from co. showrooms. For
them service is important .Beside convenience and other factors service is key
factor.
Also majority of customers do not want any financing scheme for
purchasing the Iron and Steel.
There was heavy rush on weekends.
Customers are also now very choosy in buying the product and it is
important for the company to make loyal customer of their brand.
The product is well aware and it is on top of mind of customer.
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Most of the times many of the customers are not aware of the bidding
system they have to follow.
Some of the customers are not satisfied with the service they get from
the organization afterwards.
8A. Limitations
ISP-SAIL is a huge organisation and so it was not possible to cover the entire
organisation.
Time factor for the staff is a big problem.
To get certain official and technical data is a real problem as they are highly
confidential.
The marketing policies of ISP-SAIL change from time to time and from product
to product.
The product range of ISP is numerous and so it is not possible to cover each and
every product.
Lack of proper guidance during specific situations.
8B. Observations
The following observations were made from the graphical representation as well
as the responses of the customers:
Quality of Steel is inconsistent.
At times test certificates do not justify quality of the material.
Consumers prefer lowering of prices.
For structural materials, prompt response is expected, attention to small
customers just like big customers or others.
Maintenance of fast delivery schedule
Improvement in post sale services.
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8C. Suggestions
Modernization of the plant should be completed in less than a year.
More integration with the clients is needed
Stability of prices
Should be more prompt to response against any requirement and settlement of
accounts
Each individual from top management to worker should be made aware of cost
control, faster production and maintaining quality.
ISP should produce lower sized TMT bars in sizes 8, 10, 12 mm as per
requirement by the customers.
Improvement in customer relationship management
Continued monitoring of the market
Customer service to be given prior importance
Committed delivery thrust on quality
Complaints should be attained properly
Regular customer contact/interaction should be taking place
Planned production of Benzol to suit market.
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9. CONCLUSION
After the formation of the present UPA Government, initiatives were taken by
Shri Ram Vilas Paswan, the Hon‟ble Minister for Chemicals & Fertilizers and Steel for
merger of IISCO with SAIL. On June 16, 2005, the Union Cabinet cleared the decks for
the merger, authorizing Ministry of Steel to initiate the official procedures. IISCO has
been merged with SAIL on Feb 16, 2006 and is renamed as IISCO Steel Plant, the fifth
integrated Steel Plant under SAIL after RSP (Rourkela), BSP (Bhilai), BSL (Bokaro)
and DSP (Durgapur).
Now timely completion of each project will depend on IISCO‟s ability in the
next few years to mobilize the resources and ensure that these are used to create
planned capacity in the system. Ultimately successful implementation of the
modernization and expansion will determine whether or not IISCO Steel Plant becomes
a new centre of gravity for Indian Steel. But clearly, it is advantage steel and it is for
employees to demonstrate that they can rise to the challenge and fulfill their aspirations.
If just three years back somebody had said that one day IISCO would become the
engine of growth for economic recovery of this region, he would have been regarded as
either wildly optimistic or clinically insane. Today, howsoever unbelievable it may
seem, it is heading towards just that.
In its new avatar, IISCO Steel Plant is now on the cusp of growing at a
precipitous pace. From the ubiquitous roadside hoarding proclaiming “Marching
Ahead” to the new contracts being signed every month, calling IISCO Steel Plant‟s
modernization and expansion as the biggest reality shoe ever would not be far off the
mark.
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10. BIBLIOGRAPHY
www.sail.co.in
www.wikipedia.com/iisco_home/org
Business world magazine
www.scribd.com/ppt/steel-production
Business today Magazine
SAIL-ISP monthly magazine, “Faithfully”
Economics times News paper
Times of India Newspaper
„CMO news‟- A House Magazine of Central Marketing Organization of
SAIL
All the major Departments of IISCO Steel Plant, Burnpur
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11. APPENDIX
Questionnaires for the Potential Customers of SAIL-ISP:
Q1. Use of Iron and steel in your life -----------
Extremely Important
Very Important
Somewhat important
Not very Important
Not at all Important.
Q2. Business with ISP -----------
Extremely Important
Very Important
Somewhat important
Not very Important
Not at all Important
Q3. Product quality of ISP-SAIL -----------
Excellent
Very good
Good
Fair
Poor
Q4. Process of buying products of ISP-SAIL -----------
Excellent
Very good
Good
Fair
Poor
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Q5. Price of the products are same as market price -----------
Strongly disagree
Disagree
Neither agree nor Disagree
Agree
Strongly Agree
Q6. ISP-SAIL satisfy your needs and demands ------
Strongly disagree
Disagree
Neither agree nor Disagree
Agree
Strongly Agree
Q7. ISP-SAIL gives better service than other steel plant ---
Strongly disagree
Disagree
Neither agree nor Disagree
Agree
Strongly Agree
Q8. You will continue buying products of ISP-SAIL for next five years ----
Strongly Disagree
Disagree
Neither agree nor Disagree
Agree
Strongly Agree
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Q9. What is your opinion about ISP-SAIL?
Q10.What is the first word that comes to your mind when you hear the
following?
Steel Industry
IISCO Steel Plant