8/6/2019 Laxmikant Bsp Project
1/91
A
PROJECT REPORT
ON
Marketing and Strategic Planning Of SAIL (BSP) &
Customer Satisfaction Index
BHILAI STEEL PLANT
STEEL AUTHORITY OF INDIA LIMITED
BHILAI STEEL PLANT
SUBMITTED IN PARTIAL FULFILLMENT FOR
IISCS
(2009-2011)
1
8/6/2019 Laxmikant Bsp Project
2/91
GUIDED BY: SUBMITTED BY:
Rahul Arora Vivek Kumar Gupta
STEEL AUTHORITY OF INDIA
LIMITED
BHILAI STEEL PLANT
Certificate This is to certify that the Project Report entitled
Marketing And Strategic Planning Of SAIL
(BSP) & Customer Satisfaction Index in BHILAISTEEL PLANT submitted by Vivek kumar Gupta
for the partial fulfillment of IISCS Indore degree
from University Of Sikkim manipal is abonafide presentation under my guidance and
supervision.
I wish them the best of luck for future.
Guided By
2
8/6/2019 Laxmikant Bsp Project
3/91
RAHUL ARORA
INTERNAL GUIDE, BSP
DECLARATION
I VIVEK KUMAR GUPTA Roll no.520942762 student of
MBA ivth semester of Department of Management
Studies, Indore Indira school of career studies,
Indore (MP) hereby declare that the project report on
MARKETING AND STRATEGIC PLANNING OF SAIL
AT BHILAI STEEL PLANT (BSP), is an original and
authenticated work done by me. I further declare that it
has not been submitted elsewhere by any other person in
3
8/6/2019 Laxmikant Bsp Project
4/91
any of the University for the Award of any degree or
diploma.
VIVEK KUMAR
GUPTA
ACKNOWLEDGMENT
We would like to take the opportunity for expressing our sincere thanks and
gratitude to Mr. Rahul Arora, Dy Mgr (M&SP), for his support and able guidance
4
8/6/2019 Laxmikant Bsp Project
5/91
in giving us a detailed insight on marketing of secondary and by-products in Bhilai
Steel Plant and for imparting knowledge and skills required for the successfulcompletion of the project.
We would also like to thank Mrs.Shusmita Dey (Secondary Product) &
Mr.Rahul Arora (Coal chemicals) for their kind cooperation and giving us the
detailed information about the marketing practices in the organization which were
necessary for the completion of our project.
CONTENTS
CHAPTER -1 6
. Introduction 6
. Organizational Overview 10
5
8/6/2019 Laxmikant Bsp Project
6/91
a) About SAIL 10
b) About BSP 19
CHAPTER -2 29
. Marketing in the organization 29
CHAPTER -3 40
. By-Products 40
. Secondary Products 56
CHAPTER -4 64
. Analysis of C.S.I 64
CHAPTER -5 80
. SWOT Analysis 80
. Conclusion 81
. Biblography83
CHAPTER 16
8/6/2019 Laxmikant Bsp Project
7/91
1. Introduction
During the last few years, measuring consumer satisfaction has acquired a very
important role in organizational studies conducting by the marketing department of
various organizations. Many companies have begun to appreciate consumer
satisfaction as a key variable for gaining a competitive advantage.
The importance of studying and understanding consumer satisfaction is principallybased on the impact of this variable on brand loyalty. In comparison to the
innumerable efforts made to study the satisfaction of end consumers, very little has
been done with respect to the study of the industrial buyers satisfaction. The
business-to-business activity sector presents a series of particular features; for
instance, the purchase decision process is a much more complex and formal than
in the case of end consumer one. No further mention is made to a single person
deciding, but to a buying center including several persons who bear upon the
buying decision process on the other hand, industrial buyers are generally
professional buyers who are technically competent.
Therefore, this project investigates the satisfaction of industrial buyers as well as
the relationships between their perceptions of the product/service quality and their
satisfaction and aims to find out the gaps existent in the current service provided
by the plants.
7
8/6/2019 Laxmikant Bsp Project
8/91
Objective of the Study
The project mainly concentrates on the evaluation of the overall customer
satisfaction level with the services provided by BSP to its secondary and by-
products customers.
The project report also aims at analyzing the existing gaps in the services provided
by the plant to its customers on the basis of judging the satisfaction and
importance level or say expectation level of the customer with that parameter of
the service quality.
On the basis of servqual (service quality) model and the IP map the project aims at
finding out the parameters which need to be concentrated on by the management in
order to improve the satisfaction level of the customers with the overall services
provided by the plant.
8
8/6/2019 Laxmikant Bsp Project
9/91
Research Methodology
a. Sample Selection
The project required gauging the satisfaction level of nearly 200 customers who
are directly involved with BSP for the procurement of secondary products and by
products produced by the plant in the process of generation of the primary
products.
For conducting the survey we selected a list of 25 customers as per our
convenience with a good mix of customers of secondary as well as by-products so
as to reflect the sentiments of the whole sample frame as closely as possible. The
sample of 25 local customers in the Bhilai-Raipur region consisted of 15
secondary product based customers and 10 by-products based customers.
b. Data Collection
A questionnaire was developed as part of a larger effort to study the satisfaction of
the customers with service levels of the plant provided to secondary and by-
products customers. The questionnaire included the eleven specific parameters
identified from the literature which could best reflect the service quality. The
respondents were asked to indicate, on a seven-point itemized rating scale, thelevel of satisfaction of each item in motivating them to have the perception of
being satisfied (1 = highly dissatisfied, 7 = highly dissatisfied ) as well as to
indicate th level of importance of the parameters on seven point likert scale
9
8/6/2019 Laxmikant Bsp Project
10/91
where(1 = low, 7 = high importance level). In addition, they were asked to
indicate, on a five-point scale, how satisfied they were with the overall servicelevels.
The survey required gathering of information about the current perceptions and
expectations of the customers so as to have a good idea about the satisfaction level
of the customers with the services of BSP and also have a good insight into the
parameters that need improvement for improving the services further.
Since all the customers of BSP are linked to BSP through B2B interaction, so for
collection of primary data we choose in-depth interview along with a questionnaire
as the tool for data collection.
For the collection of secondary data we referred the SAIL website and the
information provided by the marketing department along with the data available
with the auctioning site which is in a joint venture with SAIL for the purpose of
auctioning of secondary and by-products.
10
8/6/2019 Laxmikant Bsp Project
11/91
2.Organization Overview
About SAIL
Steel Authority of India Limited (SAIL) is the leading steel-making company in
India. It is a fully integrated iron and steel maker, producing both basic and special
steels for domestic construction, engineering, power, railway, automotive and
defence industries and for sale in export markets.
Ranked amongst the top ten public sector companies in India in terms of turnover,
SAIL manufactures and sells a broad range of steel products, including hot and
cold rolled sheets and coils, galvanized sheets, electrical sheets, structural, railway
products, plates, bars and rods, stainless steel and other alloy steels. SAIL
produces iron and steel at five integrated plants and three special steel plants,
located principally in the eastern and central regions of India and situated close to
domestic sources of raw materials, including the Company's iron ore, limestone
and dolomite mines. The company has the distinction of being Indias largest
11
8/6/2019 Laxmikant Bsp Project
12/91
producer of iron ore and of having the countrys second largest mines network.
This gives SAIL a competitive edge in terms of captive availability of iron ore,limestone, and dolomite which are inputs for steel making. SAIL's wide ranges of
long and flat steel products are much in demand in the domestic as well as the
international market. This vital responsibility is carried out by SAIL's own Central
Marketing Organization (CMO) and the International Trade Division. CMO
encompasses a wide network of 34 branch offices and 54 stockyards located in
major cities and towns throughout India.
SAIL has a well-equipped Research and Development Centre for Iron and Steel
(RDCIS) at Ranchi which helps to produce quality steel and develop new
technologies for the steel industry. Besides, SAIL has its own in-house Centre for
Engineering and Technology (CET), Training Institute (MTI) and Safety
Organization at Ranchi. Our captive mines are under the control of the Raw
Materials Division in Kolkata. The Environment Management Division and
Growth Division of SAIL operate from their headquarters in Kolkata. Almost all
our plants and major units are ISO Certified.
VISION:
To be a respected world-class corporation and the leader in Indian steel business
in quality, productivity, profitability and customer satisfaction.
12
8/6/2019 Laxmikant Bsp Project
13/91
We still have a number of persons in our country in
steel Authority of India Limited (SAIL).. They have thewill to excel and transform the country, given a long term
vision
Dr. A.P.J. ABDUL KALAM
CREDO
We build lasting relationships with customers based on trust and
mutual benefit.
Uphold highest ethical standards in conduct of our business.
We create and nurture a culture that supports flexibility, learning and
is proactive to change.
We chart a challenging career for employees with opportunities for
advancement and rewards.
We value the opportunity and responsibility to make a meaningful
difference in people's lives.
13
8/6/2019 Laxmikant Bsp Project
14/91
MAJOR UNITS
INTEGRATED STEEL PLANTS
Bhilai Steel Plant (BSP) in Chhattisgarh
Durgapur Steel Plant (DSP) in West Bengal
Rourkela Steel Plant (RSP) in Orissa
Bokaro Steel Plant (BSL) in Jharkhand
SPECIAL STEEL PLANTS
Alloy Steels Plants (ASP) in West Bengal
Salem Steel Plant (SSP) in Tamil Nadu
Visvesvaraya Iron and Steel Plant (VISL) in Karnataka
Subsidiaries
Indian Iron and Steel Company (IISCO) in West Bengal
Maharashtra Elektrosmelt Limited (MEL) in Maharashtra
Bhilai Oxygen Limited (BOL) in New Delhi
Background & History
The Precursor
14
8/6/2019 Laxmikant Bsp Project
15/91
SAIL traces its origin to the formative years of an emerging nation - India. After
independence the builders of modern India worked with a vision - to lay theinfrastructure for rapid industrialization of the country. The steel sector was to
propel the economic growth. Hindustan Steel Private Limited was set up on
January 19, 1954. The President of India held the shares of the company on behalf
of the people of India.
Expanding Horizon (1959-1973)
Hindustan Steel (HSL) was initially designed to manage only one plant that was
coming up at Rourkela. For Bhilai and Durgapur Steel Plants, the preliminary
work was done by the Iron and Steel Ministry. From April 1957, the supervision
and control of these two steel plants were also transferred to Hindustan Steel. The
registered office was originally in New Delhi. It moved to Calcutta in July 1956
and ultimately to Ranchi in December 1959.
A new steel company, Bokaro Steel Limited, was incorporated in January 1964 to
construct and operate the steel plant at Bokaro. The 1 MT phases of Bhilai and
Rourkela Steel Plants were completed by the end of December 1961.
The 1 MT phase of Durgapur Steel Plant was completed in January 1962 after
commissioning of the Wheel and Axle plant. The crude steel production of HSL
went up from .158 MT (1959-60) to 1.6 MT. The second phase of Bhilai Steel
Plant was completed in September 1967 after commissioning of the Wire Rod
Mill. The last unit of the 1.8 MT phase of Rourkela - the Tandem Mill - was
commissioned in February 1968, and the 1.6 MT stage of Durgapur Steel Plant
was completed in August 1969 after commissioning of the Furnace in SMS. Thus,
15
8/6/2019 Laxmikant Bsp Project
16/91
with the completion of the 2.5 MT stage at Bhilai, 1.8 MT at Rourkela and 1.6 MT
at Durgapur, the total crude steel production capacity of HSL was raised to 3.7 MTin 1968-69 and subsequently to 4MT in 1972-73.
Holding Company
The Ministry of Steel and Mines drafted a policy statement to evolve a new model
for managing industry. The policy statement was presented to the Parliament on
December 2, 1972. On this basis the concept of creating a holding company to
manage inputs and outputs under one umbrella was mooted. This led to the
formation of Steel Authority of India Ltd. The company, incorporated on January
24, 1973 with an authorized capital of Rs. 2000 crore, was made responsible for
managing five integrated steel plants at Bhilai, Bokaro, Durgapur, Rourkela and
Burnpur, the Alloy Steel Plant and the Salem Steel Plant. In 1978 SAIL was
restructured as an operating company.
SAIL TodaySAIL today is one of the largest industrial entities in India. Its strength has been
the diversified range of quality steel products catering to the domestic, as well as
the export markets and a large pool of technical and professional expertise.
Today, the accent in SAIL is to continuously adapt to the competitive business
environment and excel as a business organization, both within and outside India.
JOINT VENTURESAIL has promoted joint ventures in different areas ranging from power plants to
e-commerce.
16
8/6/2019 Laxmikant Bsp Project
17/91
NTPC SAIL Power Company Pvt. Ltd.
Set up in March 2001; this 50:50 joint venture between SAIL and the NationalThermal Power Corporation (NTPC) operates and manages the Captive Power
Plants-II of the Durgapur and Rourkela Steel Plants which have a combined
capacity of 240 MW.
Bokaro Power Supply Company Pvt. Limited
This 50:50 joint venture between SAIL and the Damodar Valley Corporation
formed in January 2002 is managing the 302-MW power generation and 1880
tonnes per hour steam generation facilities at Bokaro Steel Plant.
Bhilai Electric Supply Company Pvt. Limited
Another SAIL-NTPC joint venture on 50:50 basis formed in March 2002 manages
the 74 MW Power Plant-II of Bhilai Steel Plant which has additional capacity of
producing 150 tonnes of steam per hour.
UEC SAIL Information Technology Limited
This 40:60 joint venture between SAIL and USX Engineers & Consultants, a
subsidiary of the US Steel Corporation, promotes information technology in the
steel sector.
Metaljunction.com Private Limited
a joint venture between SAIL and Tata Steel on 50:50 bases, this company
promotes e-commerce activities in steel and related areas.
SAIL- Bansal Service Center Pvt. Ltd.
SAIL has formed a joint venture with BMW industries Ltd. on 40:60 basis to
promote a service centre at Bokaro with the objective of adding value to steel.
17
8/6/2019 Laxmikant Bsp Project
18/91
North Bengal Dolomite Limited
A joint venture between SAIL and West Bengal Mineral DevelopmentCorporation ltd on 50:50 basis was formed for development of Jayanti Dolomite
Deposit, Jalpaiguri for supply of Dolomite to DSP and other plants.
Romelt -SAIL (India) Ltd.
A joint venture between SAIL, National Mineral Development Corporation
(NMDC) and Russian promoters for marketing Romelt Technology developed by
Russia for reducing of iron bearing materials, which is carried out with carbon in
single stage reactor with the use of oxygen.
Ownership and Management
The Govt. of India owns about 86% of SAIL's equity and retains voting control of
the Company. However, SAIL, by virtue of its "Navratna" status, enjoys
significant operational and financial autonomy.
SAIL - Into the Future
Modernization and Expansion Plan of SAIL Corporate Plan, 2012
Corporate Plan, 2012 (CP12) was formulated in 2004 for 4 integrated steel plants
for increase in Hot Metal production to 20 Mt by 2012. After merger of in IISCO
Feb 06, the Hot Metal production Plan was revised to 22.5 Mt by 2012.
Expansion of Special Steel Plants was also included. Besides capacity
18
8/6/2019 Laxmikant Bsp Project
19/91
enhancement, the plan also addresses the need of SAIL Plants towards eliminating
technological obsolescence, energy savings, enriching product mix, pollutioncontrol, developing mines & collieries to meet higher requirement of key raw
materials, introduce customer centric processes and have matching infrastructure
facilities in the Plant to support higher production volumes. Investment to the tune
of Rs 34,982 crore was envisaged under the Corporate Plan.
Objective of Corporate Plan 2012
100% production of steel through Basic Oxygen Furnace (BOF) route
100% processing of steel through continuous casting
Value addition by reduction of semi finished steel
Auxiliary fuel injection system in all the Blast Furnaces
State-of-art process control computerization / automation
State-of-art online testing and quality control
Energy saving schemes
Secondary refining
Adherence to environment norms
Expansion Plan, 2012
The Corporate Plan, 2012 was reviewed by Honble Minister of Steel in Jul06,
wherein it was decided to take up the Expansion of Integrated Steel Plants and
19
8/6/2019 Laxmikant Bsp Project
20/91
Special Steel Plant in one go basSed on Composite Project Report (CPFR). By that
time Expansion of IISCO Steel Plant and Salem Steel Plant was already approvedin-principle based on the Techno-Economic Feasibility Report (TEFR) of
MECON. For the Expansion of other four integrated Steel Plants, MECON was
assigned the job of Preparation of CPFR in Aug06. The CPFR for the four
integrated steel plants was prepared by MECON. In principle approval has been
accorded by SAIL Board for the expansion plans of IISCO Steel Plant (Jul06),
Salem Steel Plant (Jun06), Bokaro Steel Plant (Dec06), Bhilai Steel Plant
(Apr07), Rourkela Steel Plant (May07) and Durgapur Steel Plant (Jul07).
Item
2006-07
(Actual)
Capacity as per
Expansion Plans 2010
Hot Metal 14.61 26.18
Crude Steel 13.51 24.59
Saleable Steel 12.58 23.13
20
8/6/2019 Laxmikant Bsp Project
21/91
Plant-wise Capacity Envisaged After Expansion (Mtpa)
Plant Hot Metal Crude Steel Saleable Steel
BSP 7.5 7.0 6.53
DSP 3.5 3.0 2.83
RSP 4.5 4.2 3.8
BSL 7.44 7.00 6.53
ISP 2.91 2.5 2.37
SSP - 0.18 0.34
ASP - 0.48 0.43
VISL 0.33 0.23 0.22
Total 26.18 24.59 23.13
About Bhilai Steel Plant
21
8/6/2019 Laxmikant Bsp Project
22/91
Bhilai Steel Plant (BSP) is a unit of the Steel Authority of India Limited
(SAIL).Bhilai Steel Plant is a pulsating giant in the glorious Industrial context of
India. It came into existence on10th June 1957.When concreting of the foundation
of 1st Blast Furnace, but its original story started on 2nd Feb.1955 when the
agreement with USSR Government prove the possibility of dreams come true
.BSP the functionary of SAIL is a symbol of Indo-Soviet Techno economic
collaboration, is one of the first three integrated steel plant set up by the
Government of India to build up a sound base for industrial growth of the country.
The agreement signed on 2nd Feb.1955 for 1MT production capacity, which rose to
than 2.5 MT (1967) and than to 4MT in 1988. Production of Crude Steel per year.
On 4th Feb.1959, our President, Dr.Rajendra Prasad dedicated Bhilai to the Nation,
by inaugurating the Blast Furnace No.1 for production. Bhilai has never looked
back has steadily grow and modernized day by day.
22
8/6/2019 Laxmikant Bsp Project
23/91
Bhilai has all along been giving special attention to the employment to the weaker
section. Bhilai has contributed signification to meet the Iron & Steel requirementof the country.
The Steel Plant has 10 coke ovens batteries and 7 Blast Furnace. The plants get his
requisition of raw material and necessary resources by various adjoining centers.
The Iron ore is met from the captive mines, 100 kms. South from BSP. Limestones
also come from the manual mines of Nandini about 25 kms. To the North of the
plant. The need of Dolomite is fulfilled from the quarries of Hirri in Bilaspur
District. Steel plant requires forms of energy, viz electricity, fuel (solid, liquid &
gaseous), steam oxygen, compressed air, chilled water, air blast etc. At Bhilai
main source of electricity in the C.S.E.B grid from the NTPC Korba Station, about
250 kms away. The steel plant has have their own capacity of generating
electricity of 36 MW and 74 MW by power plant 1 & 2 respectively as the
alternative source of power supply to meet emergency load in cases of
interruption(s).
The water source of the Tandula irrigation system from Sheonath River together
with the Gondli and kharkhara water reservoirs situated about 70 km. south of the
plant. In addition, water works has started on Mahanadi project for meeting the
increased requirement of the plant after expansion. There exist extensive
communication systems at the works, which include Auto Telephone Exchange
dispatched communication system, shop-floor loudspeaker system, gas and firesignaling and blocking system of the plant rail transport facilities etc.Seven times
winner of Prime Ministers Trophy for best Integrated Steel Plant in the country,
23
8/6/2019 Laxmikant Bsp Project
24/91
Bhilai Steel Plant (BSP) is Indias sole producer of Rail and Heavy steel plates and
major producer of structural designs. With an annual production capacity of 3,153MT of saleable steel, the plant also specializes in other products such as wire rods
and Merchant products. All saleable products of Bhilai Steel Plant are under the
ISO umbrella as per BSPs accredit ion with ISO 9001:2000 Quality Management
System Standard. The plants plate Mill, Dalli Mechanised Mines and Rail
Millhave also received ISO:14001 certification for their Environment management
system.
Performance highlights
Resolved, charged up and enthused to take their plant forward on its growth path,
the Bhilai collective unleashed its potential to scale new heights of performance in
2008-09. Not just in volumes or techno-economics of production and development
of new products but also in resource and cost management, knowledge & skill
development of human resources, institutionalisation of Internal Customer
Satisfaction systems, strengthening the Quality Circle movement and building
strong customer-supplier partnerships, spreading the good cheer, all the while, to
more homes and families. Operating above rated capacity in Saleable steel for the
16th successive year and surpassing the 5 MT mark in hot metal & crude steel
production for the third time, Bhilai recorded its best ever production of 5.4MT
Hot Metal, 5.2 MT Crude Steel and 4.5 MT Saleable Steel in 2008-09, registering
growth of 2.3%, 2.6% and 1.4%, respectively over 2007-08.
Remaining focused on reducing costs and generating surplus, the Plant further
improved its techno-economics, reducing its dependence on imported coal, and
24
8/6/2019 Laxmikant Bsp Project
25/91
increased volume of special steel grades with higher NSR to 63.3% from 48.5% in
the last fiscal.The wisdom of successive leaderships to convert crisis toopportunity and carry out process improvements in a structured manner and a
collective determination to stay at the top has ensured that nothing could arrest
Bhilais growth path. The Plant has earned profits continuously for the last two
decades, even during the last recession. Powered by high-level automation and
integration of its business processes, Bhilai is now all set to join an elite club of
leaner and smarter world-class manufacturers. Advancing from incremental to
large-scale modernization, Bhilai has maintained course in its expansion plans,
incurring a CapEx of more than Rs 800 crore in 2008-09.
Main Products Key Segment Key Customers Market Size
(Million T)
Market
Share
RailsRailway Track Indian Railways 0.776 100%
Plates
Heavy M/c.
Boiler & PV
Line-pipe
water
Line Pipe-
Crude & Gas
Construction/Fa
brication
Export Europe,
FE
Thermax Limited
Indian Oil CorporationLtd.
Essar,Ispat, Tata
Bharat Earth Movers
Limited
Nagarjunha Construction
Co.
BPCL
5.598 22%
Bars, Rods &
Structurals
Wire Rods
Electrode Qlty
Wire drawers
Larson & Turbo Ltd.
Gammon India Ltd.
KEC International
27.015 5.3%
25
8/6/2019 Laxmikant Bsp Project
26/91
Construction
TMT bars &
Structurals
Limited
National Thermal Power
Corporation Ltd.
Bharat Heavy Electricals
Ltd.
Competitors
Ispat Industries Ltd.
Alloyds Steel Ltd.
Essar Steel Ltd.
Jindal Steel &Power Ltd.
Jindal Strips Ltd.
Uttam Steel Ltd.
National Steel Industries Ltd.
Bhushan Steel & Strips Ltd.
Products of National Importance
BSP has made immense contribution to the national economy by continuously
upgrading the quality of its products to meet customer requirements. It is the sole
supplier of rails to Indian Railways, and has supplied rails whose total length adds
up to more than 7 times the periphery of the earth. It is popularly said that the
nation moves on Bhilai Rails. In 2006 the first consignment of 260 meter Rails, the
longest rail dispatched by any manufacturer in the world, was sent from Bhilai.
26
8/6/2019 Laxmikant Bsp Project
27/91
BSP has developed the UTS -100 High Strength Vanadium Micro-alloyed rails for
high density, heavy haulage routes.
BSP has also collaborated with the Indian Navy for the development of DMR-
249A (ABA) grade steel for making the first indigenous Aircraft Carrier. The
collaboration with the Navy is expanding and BSP is also making steel for
manufacture of submarines.
As Bhilai products are primarily catering to Infrastructure segment, they are being
used in key applications of infrastructural development for sustaining the growth
of the national economy. It is a matter of pride that BSP is key supplier of quality
steel to many prestigious mega projects of the country. These infrastructure
projects include rail lines, bridges, dams, air / sea ports, refineries, pipelines,
stadiums, hospitals, schools, etc. More importantly many of these projects are bold
intentions of the nation to make a difference in peoples lives. Some of the mega
projects where Bhilai steel is being used are
Mega Infrastructure Projects using Bhilai Steel
Worli Bandra Sea link, 8 lane bridge
340 km J & K Rail link having 64 bridges
Tsunami Rehabilitation Social Infrastructure Project
Barh power Project of NTPC (3x650) MW
Windmills by Suzlon
Lower Subansiri Power Project Assam-Arunanchal border by NHPC
27
8/6/2019 Laxmikant Bsp Project
28/91
Mumbai Airport
Irrigation projects
Mahanadi Railway Bridge by Braithwhile Burn & Jessop Construction
Company
Mejia Thermal Power station by BHEL in West Bengal
Bansagar Canal Project on Sone river
Delhi Metro
Korba Power Plant
Achievements
Bhilai Steel Plant bagged the most prestigious Prime
ministers Trophy Award 2004-05 for becoming the bestamong integrated steel plant. Out of 14 PMs Trophy awardedso far Bhilai Steel Plant has bagged it 7 times.
28
8/6/2019 Laxmikant Bsp Project
29/91
29
8/6/2019 Laxmikant Bsp Project
30/91
5 Employees from Rail & Structural Mill bagged PrimeMinisters Shram Ratna The highest Shram award. Out oftotal 15 awarded so far in the country, 13 awardees are fromBhilai Steel Plant.
11 Employees from Bhilai Steel Plant bagged PMs Shramawards in 2006. A total of 75 BSP Employees awarded withShram Shree, Shram Veer and Shram Bhusan so far.
20 Employees were honored with the Rashtriya Vishwakarmaaward for the year 2006 - a total of 352 BSP employees havebeen awarded since inception.
Bhilai Steel Plant bagged the Green Tech Silver Safety award,2006 instituted by Green Tech Foundation. Bhilai Steel Plant isreceiving this award for last 3 years in different sectors i.e.
Steel sector in 2003-04, Metallurgical sector in 2004-05 &Mining and Metal Sector in 2006.
BSP also bagged the Greentech Environment Excellence GoldAward for 2007 in Metal and Mining Sector.
30
8/6/2019 Laxmikant Bsp Project
31/91
BSP bagged Greentech Platinum award in the year 2008 inMetal and Minning Sector.
Ispat Suraksha Puraskar for the year 2005 & 2007 awarded toBSP by JCSSI.
Bhilai Steel Plant has won Corporate Sustainability prizeinstituted by CII-ITC Centre of Excellence for the year 2006 &2007 in the Independent Unit category for exemplaryperformance in environmental economic and social dimensionsof sustainable development.
Bhilai Steel Plant bagged the prestigious Indira Gandhi
Memorial National Award - 2004 of Excellent Pollution ControlImplementation Gold Award for Excellence inIndian Industries,sponsored by the International Greenland Society, Hyderabad.
Golden Peacock Eco-innovation award 2006 has also beenbagged by Bhilai Steel Plant.
Bhilai Steel Plant bagged Golden Peacock Env. Excellenceaward 2007
BSP bagged Golden Peacock Award for Combating Climatechange - 2008
Bhilai Steel Plant received IIM National Quality Award 2005 inthe category of Integrated Steel Plant.
Golden Peacock Award for the most innovative product wasawarded to Bhilai Steel Plant in the 16th World congress on
Total Quality (WCTQ 2006)
BSP bagged Rajiv Gandhi National Quality Award for 2006 in Bestof all categories.
BSP bagged Golden Peacock National Quality Award 2006 &
2007.
Bhilai Steel Plant was declared winner for HR Excellence Awardby CII, Chhattisgarh.
Golden Peacock Training Award for the year 2006 & 2008.
31
8/6/2019 Laxmikant Bsp Project
32/91
CHAPTER -2Marketing in the Organization
CENTRAL MARKETING ORGANIZATION( CMO)
The ISO: 9001:2000 certified Central Marketing Organization (CMO) is Indias
largest industrial marketing set-up that markets carbon steel Produced by the four
integrated steel plants of SAIL. Headquartered in Kolkata, it transacts business
through its network of 34 Branch Sales Offices spread across the four regions, 25
warehouses equipped with mechanized handling systems, 11 Customer Contact
Offices and 16 Consignment Agents. CMOs domestic marketing effort is
supplemented by its ever-widening network of authorized and rural dealers who
meet the demands of the smallest customers in the remotest corners of the country.
A strong IT support system enables real-time network connectivity within the
entire CMO network. Extensive customer contact, product and segment
specialization, close monitoring of order servicing and feedback analysis through
the Customer Satisfaction Index are established norms at [-MO. The customer-
friendly approach of CMO is backed by practical after- sales services. Through the
process of Key Account Management, CMO provides single window service to
key customer across the country for every business transaction from enquiry to
32
8/6/2019 Laxmikant Bsp Project
33/91
order booking, order tracking to delivery, and even consultancy and after-sales
services.
Central marketing organization is the marketing unit of SAIL. The Central
Marketing Organization (CMO) of SAIL was formed in 1963 when the public
sector steel plants were managed by Hindustan Steel Private Limited. It caters to
the domestic market and is responsible for marketing of all the products
manufactured by all the steel plants of SAIL in a coordinated manner. The CMO
undertakes marketing of materials produced by SAILs plant through a distribution
network of 43 Branch Sales Offices (BSO), stockyards, dockyards, consignment
agents and extension counters spread all over the country. Central Marketing
Organization (CMO) and most of its divisions have their Headquarters at Kolkata
and they reports to the Director headquartered at Delhi. However, departments like
transport and shipping, export and etc. report to exchange to Executive Director
located at Delhi.
Marketing Strategy
a) Ensuring dominant position in the Indian steel market
b) Maintaining continuous global presence (around 10 % by sales value)
c) Building & enhancing Brand Value of SAIL products
d) Further thrust on Key Account Management process
e) Gradual shift towards more of customers sales, as against traders sales
33
8/6/2019 Laxmikant Bsp Project
34/91
f) Trading of steel by sourcing from international sources, to enable packaging
for key customers
g) Popularizing SAIL products in the rural market
h) Maximizing IT enabled customers service and interactions
Major Function
Market research, Demand Assessment, segment prioritization, product planning,
sales and after sales services etc. CMO has a network of sales offices and
stockyards within the country for purpose of distribution of materials outlets. The
other aspects controlled by CMO are planning, customer services, transport and
shipping data information system etc.The distribution of iron & Steel products is
done by the CMO through 45 branches and stockyards located in all important
steel consuming centers in the country. For administration purposes, the branches
are grouped under 6 regions. The distribution through the stockyard is of the order
of 69% and through direct dispatches by the plant 31%. They operate various
schemes of the products is fast and the customer are satisfied.
Other important functions of (CMO):
CMO has got responsibility to sell Pig Iron & Prime Steel Products manufactured
by BSP, DSP, RSP & having its headquarters at Ispat Bhavan, 40, Chowringhee
Road, Kolkata-71.CMO has got 43 branches spread throughout the country with
stockyard, for storing and selling of iron and steel materials produced by the
plants.
34
8/6/2019 Laxmikant Bsp Project
35/91
Each branch is headed by a Branch Manager having other colleagues including
Finance executives to help Branch Manager in day to day operation.
The entire network branches are divided into four regions as given below:
Eastern Region
Western Region
Southern Region
Northern Region
CMO has got transport and shopping determinants to handle the export and import
consignments at different ports. These offices are at following places.
Calcutta
Chennai
Paradip
Haldia
Visakhapatanam
To coordinate about production and dispatches in different steel plants, CMO has
got SRM offices at following places :
Bhilai
35
8/6/2019 Laxmikant Bsp Project
36/91
Durgapur
Roukela
To take care of the exports, CMO has got office at New Delhi,
There is separate fertilizers and chemical division to sell fertilizers and chemicals
produced by the plants.
There are three executives called as product executives for BSP they take care of
separate division in BSP the main divisions being:
Plate Mill
Heavy Structure
Structures
The movement plans are generated by BSO only. The main purpose of the
movement plan is to give the commercial as well as the quality information of any
particular transaction. This information is then sent to the M & SP department of
BSP.
Various Divisions Of CMO
The following are the major divisions of the Central Marketing Organization:
1. Central Planning & Products Division: The main function of the division is to
bring about coordination between the market demand and production of the
steel plants. The four Resident Sales Mangers of the CMO located in four
36
8/6/2019 Laxmikant Bsp Project
37/91
tonnage plants report to this divisions in respect of matters relating to
marketing viz. movement, dispatches etc.
2. Alloy Steel Divisions: This division looks after marketing of alloy and special
steel product manufactured by alloy Steel Plant, Durgapur and also
coordinates sales efforts with Visvesvaraya Iron & Steel Co. Ltd (VISL),
SSP and MEL.
3. Pipes, Electrical Steel Sheets & Tin Plates Division: Headquarters of this set up is
located at Mumbai where majority of the customers for these materials are
situated. These materials have to be marketed under highly competitive
conditions. This division works out marketing strategies such as pricing,
distribution system, storage and delivery facilities etc. This division has a
field set up at each of the regional headquarters.
4. Market Management Group: This group is headed by group market manager.
This group cosistes of market managers. Market managers are responsible
for
market strategy & planning in terms of sales, market share & profitability in
a specific market segment.
5. Salem Steel Products Divisions: This division headquartered at Chennai by
Salem Steel plant. They have field office at each of the regional
headquarters as well as major consumption center.
37
8/6/2019 Laxmikant Bsp Project
38/91
6. Marketing Services Divisions(MSD): This division looks after the management
of this divisions is supported by a computer center where data on marketingoperations throughout the country are processed on a regular basis to bring
out periodical MIS reports. The responsibility of designing & implementing
road movement, handling contract systems etc. is also with them.
7. Commercial Division: This division deals with formulation of polices on
distribution. This division also deals with parliament question on behalf of
Central Marketing Organization.
8. Application Engineering Group: This division deals with application about
selection of best suited raw materials, development of new products
required by the market etc. It also undertakes technical inspection on behalf
of the CMO wherever needed. The A.E. personal are posed at each regional
headquarters.
9. Fertilizers and Chemicals Divisions: This division is headquartered at Kolkata
and looks after distribution of Ammonium Nitrate products by Roukela
Steel Plant and Ammonium sulphate produced by all the steel plants. This
division has got offices at field location where the demand for fertilizers is
substantial.
10.Market Research Group: This division undertakes assessment of demand for
Pig Iron & steel products for long term perspective & advice management
about the market. This division brings out periodic reports covering various
38
8/6/2019 Laxmikant Bsp Project
39/91
aspects of consumption, market condition, competitors activates etc. They
have field representatives for collecting & forwarding market intelligence tothe headquarters.
11.Transport & Shipping Department: The department is headquartered at
Kolkata and has branch offices at major port areas. This division is
responsible for handling imports & exports on behalf of SAIL. These
divisions clear the coals imported of SAIL, at the ports and forward the
same to various steel plants.
12.Finance & Accounts Department:This department renders financial advice to
the line managers as well as CMO headquarters and maintains the accounts
of the Organization covering Home sales, Transport and shipping exports,
internal audit, etc.
13.Computerization Division:This division is headquartered at Delhi and reports
to General Manager, This division is in change of the on going project for
total Computerization of CMO at headquarters field offices and SRM in the
plant location. At present this division is responsible for hardware and
software maintenance also. Software Development Center at Hyderabad is
engaged in developing and updating software required for CMO marketing.
39
8/6/2019 Laxmikant Bsp Project
40/91
14.Legal Cell: This cell deals with all legal matters of CMO like court cases,
arbitration, examination of different documents for giving loans toemployees for house building & renders legal advice on various
transactions. This is headed by GM (Law) who reports to Director
(commercial)
15.International Trade: This department is headquartered at Delhi is Commercial
Directorate and is in charge of the export and import operations of SAIL.
16.Special Project Division: This division is headquartered at Delhi and reports to
Director (commercials). This division deals with modernization of
stockyards giving technical help and assistance to the stockyard in
maintenance of handling equipment etc. This department also deals with
construction of office building of CMO and acquisition / construction of
residential accommodation etc.
BRANCH SALES OFFICE( BSO)
It is a part of CMO various BSO offices are located all over India which performs
the job of marketing of SAIL products throughout the India. It receives the order
from various customers, does market research, analyze competitive position,
demand pattern etc.
40
8/6/2019 Laxmikant Bsp Project
41/91
SALES RESIDENT MANAGER( SRM)
BSO cannot directly contact with the plant for various dispatches & order, So
SRM is basically a coordinator between BSO and plan, each plant has their SRM
offices located near the plant premises for access of the orders.
Pricing Done By BSO
The prices for all products at BSP are done by the government of India. These
prices are fixed and are quite economical for the customers as it is quite low as
compared to the competitors.
Selling Methods
There are two methods for BSP:
1. Tender Pricing
2. E-auction
Types of Customers
There are two types of customers:
1. End user customers: These customers basically use products in factory,
plants for power projects of other purposes like fabrication.
2. Traders:These customers buy products from us and again sell them to the
end users.
41
8/6/2019 Laxmikant Bsp Project
42/91
INTERNATIONAL TRADE DIVISION (ITD)
CMOs International Trade Division (ITD): In New Delhi manages exports of
iron & steel products of Sails four main integrated steel plants and maintains
close liaison with buyers abroad. ITD has successfully established SAILs
reputations as a producer of quality steel products and a consistent supplier across
the five continents. Among the notable destinations are China, Korea, UAE,
Europe (UK, Italy, Spain & Germany), Taiwan, Japan, Thailand and Singapore as
well as neighboring countries like Sri Lanka, Myanmar, Nepal and Bangladesh,
etc. The critical function of ensuring efficient and proper dispatch of export
materials and timely import of raw materials to maintain the pace of production of
the SAIL plants is performed by CMOs Transport & Shipping Division (T & S)
headquartered at Kolkata, T&S has branch offices at Haldia, Paradip and Vizagports.
PRODUCT PROFILE -Bhilai offers a rich and varied product mix to the
domestic and international markets by different ways. They are divided into two
categories, which is:
1. Prime Product
2. Secondary Product
Prime Product
42
8/6/2019 Laxmikant Bsp Project
43/91
Billets/ square (MM) : 50,60,80,85,100,120,150,280,320
Rails (KG/Mtr) : 45,52,60 Crane rails (kp) : 80,100,120
Angle (MM) : 50x50x5/6,65x65x5/6,8/10,75x75x6/8/10,
80x0x6/8/10, 90x90x6/8/10, 50x150x16/20,
200x200x16/20
Secondary Product
Coke fraction
Slab
Cast Iron Scrap
Steel Scrap
Coal chemical
Benzene, Toluene, Pitch, Naphthalene, Flukes, Heavy Creosote Oil, Anthracene
oil, light creosote oil ,hard granulate and liquid pitch, extra hard pitch, road tar,
sodium phenol ate, xylene, fertilizer.
43
8/6/2019 Laxmikant Bsp Project
44/91
CHAPTER -3
4. By-Products
Categories of Coal Chemical Product
44
8/6/2019 Laxmikant Bsp Project
45/91
Coke oven gasBenzolTar Product GasFertilizerBenzene
Toluene
Xylene
Solvent Oil
Pitch
Light crude
& Wash Oil
Light Oil
Naphthalene
DPO
DNO
HB
BF Slag
Crude coal tar
Ammonium
Sulphate
N2
O2Organ
45
8/6/2019 Laxmikant Bsp Project
46/91
USES OF COAL CHEMICALS PRODUCT
1. Benzol
Benzene Nitration Grade
Specification (is 534-1974 g-1)
Co lour -not darken then a freshy prepared
Packing and delivery: railway tank wagons road tanker in loose
Common Uses
Lab school college and various laboratories
Various cyclice compound: aniline nitro benzene nylon-6, phenol, dicloro di
floro hexa benzene (d.d.t.) benzene hea chloride,mono choloro benzene.
Raw material for various drugs and dye-stuff, synthetic rubber, styrene
Nylon intermediates, resin intermediates
46
8/6/2019 Laxmikant Bsp Project
47/91
2. Toluene: Industries Grade
Specification is 536-1967-1
Colour not darken then a freshy prepared
Packing and delivery: railway tank wagons road tankers in loose
Common Uses
Rubber and paint industries as a synthetic enamale
Thinners and varnish
Printing ink making
Organic compound : Benzoic acid, sodium benzonates, benzeyle chlorides,
Solvent, artificial sweatings
Adhesive, synthetic fibers
3. Xylene
Common Use
Rubber and paint industries : as a synthetic enamel
Thinners and varnish
Printing ink
47
8/6/2019 Laxmikant Bsp Project
48/91
Pathetic & hydride
4. Light Solvent (Naphtha)
Common Use
Solvent
Thinners and varnish
Printing ink making
Starting material for dyes
5. Solvent Use
Common Uses
Solvent for resins and paints
Thinners and varnish
6. Still Bottom oil
Common Use
Mixed with other material and is used for various miscellaneous purpose
like
Roof tar felting for after roofing
Rubber paints industries
48
8/6/2019 Laxmikant Bsp Project
49/91
7. Pitch
Packing Pitch is filled in drum
Liquid pitch is filled in tankers
Granulated pitch is filled in bags
Common Use
Used in smelt plant in aluminum industry as a binder material for anode
used in manufacture of electrodes from pitch carbon
8. Hot Pressed Naphthalene
Hot pressed naphthalene is filled in bags. It is analyzed for crystallization
temperature moisture content, colour and ash.
Common Use
Dye intermediates
Insecticides as a preventive for month in the form of naphthalene balls
Dispersing agent tanning agent
H acid
49
8/6/2019 Laxmikant Bsp Project
50/91
Beta naphtha
Sodium napthionate
Alpha napthol
9. Anthracene Oil
Common Use
Anthracene oil is an excellent material as a feedstock for carbon blank and
gives better yield and quality of the finished product.
10. Light Cresote Oil
Common Use
Carbon black feed stock=
11. Heavy Cresote Oil
Common Use
Prevention of wooden sleepers by railways
Carbon black feed stock
12. Sodium Phenolate
50
8/6/2019 Laxmikant Bsp Project
51/91
Common Use
The phenols liberated from the sodium phenolate are virtually free from
neutral oils and pyridine bases and acan be used for synthetic purpose the
quality of phenols is also very good for the production of high quality
phenyl.
13. Dephenolate Oil
Common Use
Naphthalene bearing feed stock
Naphthalene and coal tar oils are separated and used for their specific end
uses.
14. Drained Naphthalene Oil
Common Use
Naphthalene bearing feed stock
Naphthalene and coal tar oils are separated and used for their specific end
uses.
15. Heavy benzol
Common Use
Naphthalene bearing feed stock
51
8/6/2019 Laxmikant Bsp Project
52/91
Naphthalene and coal tar oils are separated and used for their specific end
uses.
16. Ammonium Sulphate
Common Use
As a fertilizer
MARKETING STRATEGIES
Any organization before setting up the marketing strategies must be clear with
some of the main point such as business, mission, external analysis, internal
environment analysis, program formation goal formulation implementation and
feedback.
The marketing strategy for an industrial product is quit different from that of a
consumer product. Therefore, marketing strategy of BSP product is very different.
Certain strategies like advertising door-door survey a product demonstration not
viable.
The main aim is to maximize the recovery of realization. More consideration is
given to:
Potential Customer
Fusible price
Production good survey
52
8/6/2019 Laxmikant Bsp Project
53/91
Thus marketing is a game plan to accomplish the objective of an
organization.
The various marketing strategy used by BSP are
Sifting Focus from Tonnage to Profit: BSP is now laying emphasis on profit rather
than on mass production. It has taken to production of product / goods according
to the customer needs and demand.
1. Cost Control and Cost Reduction:An intensive cost reduction drive yielded a
saving of Rs.900 cores in fiscal 1998-99 over and above the Rs.732 cr.
achieved in the previous year. This was primarily due to improvement in
operational year. This was primarily due to improvement in operational
efficiencies increase in productivity at all SAIL. Plants and vetter purchase
management of critical inputs.
2. Improvement in Techno Economics Better Product Mix, Yield and Quality: BSP
has brought about improvement in techno economics better product mix
yield and quality.
3. Production According to Market Need: Production is done according to the
need an demand of the market.
4. Production of High Value Products: Goods of high value are produced in BSP,
which are in great demand by the market.
5. Better Sales Realization:Goods produced are to be immediately sold for the
smooth functioning of the organization. The marketing department tries to
53
8/6/2019 Laxmikant Bsp Project
54/91
sell most of the goods produces in the stipulated time. The quality and price
of the products are good therefore there is better sales realization.
6. Just in time delivery: BSP is able to make delivery just in time because it
work in pre-planned manner it takes order only after consulting the
production unit. So that products can be delivery in the right time.
7. Better Project Management: Modernization at Bhilai has been integrated with
the business strategy of the composed five projects at cost of approx 153.50
cores was completed during year.
8. Waste Management, Diversification, Joint Venture etc:Besides the introduction
of environmental friendly. Technology is like coal dust injection system in
blast furnace commissioning of centralized dusting system etc for waste
management has been carried out by BSP, BSP is also diversifying in the
areas like cement and power. It has also launched successfully joint venture
in information technology with the USA.
9. Negotiated pricing: BSP has started this strategy of fixing the price by
negotiation with the customers thus giving due attention to them.
10. Direct Dispatches: Direct dispatches from the plants constituted 50% of total
sales with over 3.6 millions tones door-deliver to customer.
11. Appointment of Authorized Dealers: Appointment of authorized dealers to
service the small, far flung & rural demands helped in enlarging the steel
marketing & distribution network.
54
8/6/2019 Laxmikant Bsp Project
55/91
12. Marketing of New Product: Taking advantage of the modern facilities
installed at its plant BSP marketed new product during the year like thinner,gauge, hr coils, 602 kg, rails wit less than 3ppm hydrogen, tuv certified
plants, tmt bars etc.
13. Multiple Production Units: As SAIL has no. of units/ steel industries,
customers can be assured about the delivery. Even if BSP fails to produce
what it has promised to the customer, it can get it from its sister concerned
and deliver it to the customer.
14. Competitive Price: BSP prices are very competitive. It produces quality
product and they are priced worth there value.
15. Product Development: BSP brings about a continuous development in its
product to suit the needs and demand of customer like change in chemistry,
specification, composition etc. it also makes use of new technology for
production.
16. International Standards: BSP follows the standard set up by international
standardization organization likeISO: 9000 quality system etc. thus
following quality management.
17. Customized Product Mix : BSP as better product mix, which is also
customize. Therefore, it can easily produce from out side.
18. Export as a Strategy:The Company has taken to exporting of its products to
create new market and demand for itself. Total export shipments by the
55
8/6/2019 Laxmikant Bsp Project
56/91
SAIL in the year 1998-99 crossed 4.9-lakh tone. Of iron and steel yielding
foreign exchange earnings of Rs. 585 cores.
19. Sales Promotion:The Company offer rebate to its regular customers and the
customer with whom it has mou. But this is not the case always.
20. Market Research:BSP has its own research laboratory. It is modest but well
equipped research and control laboratory developed many new products
during every year.
21. Other measurement: Other measures includes complete package offering to
project authorities and increasing presence in the cold rolling segment, large
dia-pipes segment etc.
22. Marketing of this department is not done by any other department, besides
they have their own marketing department center of coal chemical, this
department is governed by BSP itself. This department makes all the
working like availability of material to the sale of materials. They book
order on daily basis or on yearly basis.
The department is also fies the price for the product and chooses mode of sale. The
committee of BSP decides the prices at the stalling of the year and this price is
called reserve price. The members of the committee are GM, DGM, and AGM.
One member from plant and one member from finance department. Basically the
marketing department of coal-chemicals has four main activities to perform, these
are:
1) Direct Sales
56
8/6/2019 Laxmikant Bsp Project
57/91
2) Product development
3) Coordination between CMO & inside plant4) Market development
i. To check the feasibility
ii. To look after quality control
iii. To keep a track of data
iv. To conduct meeting for likely demands.
SELLING PROCEDURE
Chemical products are through the following modes.
1. Memorandum of understanding
2. Fixed price basis
3. Online auction
1. MEMORANDUM OF UNDERSTANDING:Under this section, an agreement is
signed between party and the regional manager concerned. As per the terms
& condition of the agreement, the customer has to purchase the mentioned
quantity every year. Tin-scheme is applicable for one to four years.
2. FIXED PRICE BASIS: In this type selling price is fixed in advance by the
pricing committee, which are different customer.
3. Planning to fixed the price is done in the starting of financial year but it also
changed according to the market demand like, if the market is high demand
is more so according to price are also high sometime supply of coalchemical is also base on
4. contact with the coal chemicals department and ask for the quantity he
require and as the material availability and price rate. Supply is done. In this
57
8/6/2019 Laxmikant Bsp Project
58/91
selling, preference is given firstly to the government understanding, sister
plant and regular customer of BSP.5. ONLINE AUCTION: along with all the terms and condition also. At the
starting of auction sale start bid is given by metal junction, which is nearly
prevailing price in the market, and afterwards customer who has particular
in auction sale can register them giving high prices through their user ID.
All the indications of price Bavaria ions are shown in the screen of every
customers and the time of auction sale the list of H-1.
Pricing And Promotion
Pricing of coal chemicals is mainly done on 2factors:
(1)Demand &supply
Is this price is decided on the basis of market demand .If the demand is high by
charging the high price they make extra profit.
(2)Price of the competitors
Is pricing is done by pricing committee of B.S.P according to the demand of the
product and the priced fixed by the competitors. Price revision is done once a
month and also according to the fluctuations of the market situation .Thecommittee which decides upon the price , comprises of the people from
58
8/6/2019 Laxmikant Bsp Project
59/91
department of rank not less than A.G.M .Here they are not comprising to sale the
products.
Coal chemicals product promotion is done through the direct customer contact .It
is mainly seller market but sometimes due to shortage in selling, it also becomes a
buyer market .However as per the requirements and sale the positions discounts
and various schemes are offered to the customers . Broachers are used for
ammonium soleplate .It is sold by name RAJA raja is brand name for SAIL
fertilizers.
Distribution Channel And Transportation
Distribution is placed directly from BSP to the customers. For some products it is
sold through traders also although BSP on its part sells the products directly to the
customers, these customers may or may not be the end users of the product.
Transportation is mainly done through road or rail. All the transportation charges
are beard by the customers only. The customers are wholly and solely responsible
loss or damage of the goods once sold.
Once the product is sold, The marketing department sends the detailed information
of the transportation to be used by the customer to lift the materials to the inside
plain. Detailed like truck no. load permitted capacity are sent to the inside
department.
59
8/6/2019 Laxmikant Bsp Project
60/91
Understanding The Customers
B.S.P has advantage of its location especially when it comes to sale of coal-
chemicals product. Raipur a big industrial hub of the chemicals factories.
First of all B.S.P caters the need of its sister concern are as follows:
Rourkela steel plant.
Durgapur steel plant.
If there are any government requirements to government every case gets the
priority. Next is the MOU signed customers followed by the regular customers .If
alter all these B.S.P is still left with the goods they cater the demands of new
customers. The B.S.P gives local customers priority over outside customers.
Customer feedback is taken from time to time through telephones .Customer
satisfaction has increased in past recent years .Many measures have been taken to
realize this increase. Customization in pitch and benzol product has been done.
Various modes of payment are as follows:
Demand draft
Pay order
Bankers cheque
Letter of credit
60
8/6/2019 Laxmikant Bsp Project
61/91
Competitors Of B.S.P In By Product
Tar coal
Vishakhappatanam plant
Nilanchal nigam limited
Tata steel
Benzol
Hindustan petrochemicals
Reliance petrochemicals
Hindustan petrochemicals
Other sister plant of B.S.P
Rourkerla steel plant
Bokaro steel plant
Durgapur steel plant
TISCO
Foreign Competitors:
Foreign competitor sell their products through low price, credit selling and
bulk through sheep. Some factors which affect is low price, product
differentiation & credit selling.
The 7C SAIL that promote to the market as follows:
Consistent quality
61
8/6/2019 Laxmikant Bsp Project
62/91
8/6/2019 Laxmikant Bsp Project
63/91
0
50
100
150
200
250
300
1983
-84
1985
-86
1987
-88
1989
-90
1991
-92
1993
-94
1995
-96
1997
-98
1999
-00
2001
-02
2003
-04
2005
-06
2007
-08
Year
Amtin
Cr.
5.Secondary Products
An Introduction
Secondary section started functioning after the commencing of Bhilai Steel Plant.
The secondary product section of the marketing department is solely responsible
for the selling of secondary products and by products of BSP.
All the defectives/rejected items of this department except the rejected defective
plates sells scrape. The defectives plates are sold by CMO (Central Marketing
Organization) organization since December 2001.
Secondary products are the defectives or rejected materials due to improper mixing
of chemicals components or fail to meet the optimum requirements. Scrap
generated inside plant is also termed as secondary products. The secondary
63
8/6/2019 Laxmikant Bsp Project
64/91
products used here in after will mean ferrous material generated from various
production units which can either suitably be used for re-melting to produce ironand products are offered for sale if rendered surplus in production process for
example. Defective heavy blooms, Defective rails, Rails cutting, Rod cutting,
Scrap etc. The secondary product section of the marketing department is solely
responsible for the selling of secondary products of BSP. All the defective/rejected
items of this department except the rejected defective plates are sold by CMO
(Central marketing Organization).
Necessity Selling Of The Secondary Product
The net scale realization all the secondary products, by products, and products of
BSP is around Rs. 600 Crs. which is much more than from many big industries.
Out of this scrap arising itself brings about Rs. 150-200 Crs. of money every year.
Re-production of main products from these secondary products requires remitting
it against for the required composition of the materials as per desired production.
Profit is the aim of every business, and the re-utilization of these products for the
finished products proves to costlier, the management plans to sell it to the local
markets.
DETAILS OF SCRAP:
64
8/6/2019 Laxmikant Bsp Project
65/91
There are various types of scrap, which is generated from the particular prime
products, Some brief summaries are following here:
I PCM SCRAPE
This is a scrape generated in the pig casting machine and consists of splashing,
PCM runners and fires and is in the right range of upto 1 tone per piece
II BF RUNNER SCRAPE
Generated in the bf cast house in the form of runner jams etc. the maximum weight
per piece is upto 2 tones. This scrape contains amount of slag.
III UNPROCESSED STEEL
Generated in the steel melting shops in slag cups and metal ladles, as the skulls are
quite board in dimensions, some of them are required to be cut into sizes suitable
for loading into trucks. These skulls are sold in the weight ranges.
IV BSIM SCRAP
The consists of semi broken ingot mould and bottom plat scrape and is in weight
range of up to 2 tones per piece.
V COBBLED SCRAP
The cobbled scrap arises from iron rod mill and includes some rejected coils and
binding wires also.
VI REJECTED ROLLS
65
8/6/2019 Laxmikant Bsp Project
66/91
Cost iron rolls, rejected steel rolls.
VII MILL CUTTING
Rail and structural mill cutting, merchant mill cutting plate end shearing, rejected
slabs, slabs cutting miss rolled slabs, wire rod cutting are included in this type of
scrap.
Manufacturing Process
The scrap for the re- rolling is generally received from the BSP railways. These
materials are not directly re-reliable, so first is required to make a re-roll able and a
paper size as per the requirement of the finished products. In the recent years a
number of foundries and re-rolling mills came into existence throughout the
country. The small scale sector need the secondary product as input raw materials
for their production. The company has engaged in educating them the use of
secondary product for different kind of end products for consumption of general
public. This material is then continuously passed from one stand to the other unit of the finished
product.
Collection Of Scrap
I.All scraps identity the metallic scrap generated in the production process
and lying in the shop. The shops collected the scrap with the help of
overhead cranes and stock them for loading into wagons.
66
8/6/2019 Laxmikant Bsp Project
67/91
II.Rejected rails sleepers lying near the railways track inside the plant are
collected at such points from here loading and collection by truck ispossible.
III.Crane facility is provided for loading the scarp into the track whenever
cutting or processing not possible on the spot.
IV.Marketing recovery department is responsible for over all co-ordination of
scrap collection for the entire plant. For this each shop nominate one
executive for ensuring the clearance of scrap from the shop.
V.Head of the marketing customer service department requires. The progress
on scrape collection on weekly basis.
VI.MRD make suitable schedule for collection of scrap and intimates the
date of collection to respective shops.
Processing Of Scrap
I.All the scrap which collection is not sold. Some of the scrap portion is used
for the re-melting purpose, MRD identifies such scrap. It arranges
collection handling and processing of all such scrap at various yards before
sending in required quantity to the steel melting shop, converter shop and
foundry.
II.After such processing, MRD arranges supply of required scrap to
respective consuming shops.
Planning For Sale Of Secondary Product
67
8/6/2019 Laxmikant Bsp Project
68/91
I. Marketing recovery department (MRD) works out the quantum of different
types of scrap available for sale on monthly basis this is determinedascertaining the total scrap stock at the beginning of the month. Scrap
arising during consumption. The remaining quality is considered for sale. A
monthly report on availability of scrap is prepared by MRD and send to
marketing department.
II.Marketing department finalize the plan for actual quality of scrap to be sold
in consultation with MRD. Mode of sale, terms and conditions for sale,
locations and commercial aspects are finalize by marketing department.
III.The pricing committee as approved by managing director fixes the price of
each of the scrap.
IV.Marketing department obtains MDs approved on price fixed by pricing
committee.
Marketing Scenario
Without a perfect market goods can neither be purchases nor can it be sold.
Marketing is one of the major and crucial department pillars of every organization
and it is the case it SAIL.
Customer Satisfaction and Quality Assurance, these are the two motives of
SAIL for achieving their goals and establishing their market SAIL has a wide
network across the country. It is having its CMO for its marketing division. Its
headquarter is situated in Kolkata.
Bhilai steel Plant is one of the most important integrated steel plants of SAIL,
which is earning profits for last 45 years. It has established its position through a
68
8/6/2019 Laxmikant Bsp Project
69/91
better service. BSP has several departments among which marketing division play
a key role. Every plant has its own branch sales officer (BSO) who looks upon theorders of CMO. These orders are then sent to the plant for checking the availability
and production for dispatch. All departments are linked through management
information system (MIS) for CMO to each and every division of plant.
The whole procedure of BSP for marketing is, customer send their enquiries
including their requirement to CMO how looks the orders by order management
system, which further send these requirement to the regional office. Regional
office sends the orders according to different region to the BSO of each region.
After checking of materials against TDC booklets by the BSO and marketing
division of plant it is send to the customers according to the quantitative
demanded, with the same channel through wagons and trucks as the case may be.
The copies of invoice are sent to customers and regional office concerned which is
ultimately deposited in the bank payment in case of credit sale.
Secondary Sales Items
1) Defective heavy blooms
2) Defective rolled slabs from blooms & billet mill
3) Defective billet/billet Cuttings
4) Defective/Rejected Rails
5) Rail Cutting Incl. Crop. End
6) Rod cutting
7) Plate Mill side shearing
8) Plate mill end shearing CAT-I
69
8/6/2019 Laxmikant Bsp Project
70/91
9) Plate mill end shearing CAT-II
10)Defective/rejected CCS slab cutting11)Iron Scrap and Other Items
Selling Of Secondary Products
The secondary products department has taken up the intiative to sell the products
via auction only with effect from July 1st 2005.Earlier along with the auction
method the fixed price method was also in use.
Online Forward Auction
For the auction sale, the customers have to log on to metal junction.com to bid for
the product. There is no time period for the auction until the auction reaches to the
high price. Auction sale is started at a fixed price and this price is fixed by Reserve
Price fixation committee (RPTF). This committee sits one day of the auction to
fixed reserve price. Following are the procedure in online forward auction-
1) The customer can view the instant bid price on the screen throughout the
auction period.
2) Different auction is organized for the two stores.
3) The service of auction is provided by Metal junction.com4) Items are sold in lot.
70
8/6/2019 Laxmikant Bsp Project
71/91
5) Before the auction money is deposited by all the customers participating in
the auction. It is known as earnest money deposit.6) After the auction the sale order is issued.
7) If the customer does not submit the money within the 7 days of sale order the
EMD is not refunded and he is debarred for 3 months for auction.
Sample Selection
The project required gauging the satisfaction level of nearly 200 customers who
are directly involved with BSP for the procurement of secondary products and by
products produced by the plant in the process of generation of the primary
products.
For conducting the survey we selected a list of 25 customers as per our
convenience with a good mix of customers of secondary as well as by-products so
as to reflect the sentiments of the wholesample frame as closely as possible. The
sample of 25 local customers in the Bhilai-Raipur region consisted of 15
secondary product based customers and 10 by-products based customers.
CHAPTER -4
71
8/6/2019 Laxmikant Bsp Project
72/91
ANALYSIS OF CUSTOMER SATISFACTION INDEX
FOR PRIMARY PRODUCTS
The table below shows the average Customer Satisfaction Index
for primary products (LONG Products & FLAT Products) for the last
three financial years 2006-07, 2007-08, and 2008-09.
AVERAGE CUSTOMER SATISFACTION INDEX
YEAR LONG PRODUCTS FLAT PRODUCTSQUALITY
DELIVERY
SERVICE
AVERAGE
QUALITY
DELIVERY
SERVICE
AVERAGE
2006-07
92.69 88.42 93.69 91.60 97.62 83.55 92.58 91.25
2007-08
91.77 87.85 94.89 91.50 98.82 88.22 91.06 92.70
2008-09
93.89 93.82 96.15 94.62 99.44 84.46 95.76 93.22
AVERAGE
92.78 90.03 94.91
98.63 85.41 93.13
From the above table, it can be easily concluded that
satisfaction level of customer for Quality has increased over
a period of three years for the Long as well as Flat Products.
In case of Delivery, the satisfaction level of customers of
Long Products for Delivery has increased but the customers
of Flat products are not satisfied with Delivery process of
SAIL (BSP).
Satisfaction level of customers for Service, in case of bothLong & Flat Products has increased over the period of three
years.
C.S.I. Analysis for Long Products (Graphs)
72
8/6/2019 Laxmikant Bsp Project
73/91
1.Graph for average C.S.I. of Long Products for the
period of three years.
Above Graph shows the continuous improvement in
Customer Satisfaction Index (CSI) for the period of three years.
2. Graph showing the comparison of Satisfaction level of
customers for different parameters like Quality, Delivery and
Service over a period of three years for Long Products.
Above graph shows that the Satisfaction level for Quality,
Delivery and Service has increased over the last three years.
Satisfaction level for Quality and Delivery for the financial
year 2007-08 was lower than that of the previous year i.e.
2006-07.
C.S.I. Analysis for Flat Products (Graphs)
1.Graph for average C.S.I. of Flat Products for the
period of three years.
Above Graph shows the continuous improvement inCustomer Satisfaction Index (CSI) for the period of last three
years.
73
8/6/2019 Laxmikant Bsp Project
74/91
Graph showing the comparison of Satisfaction level of customersfor different parameters like Quality, Delivery and Service over a
period of three years for Flat Products
Above graph shows that the Satisfaction level for Quality
and Service has increased over the last three years.
But the Satisfaction level for Delivery came down
significantly for the year 2008-09.
Satisfaction level for Service in the year 2007-08 was lower
than that of the previous year i.e. 2006-07.
OVERALL CONCLUSION
Satisfaction level for all the three factors Quality, Delivery
and Service for the Long Products are increasing
continuously over the last three years.
While, in case of Flat Products, Satisfaction level for Delivery
decreased significantly.
If, we look the overall CSI output, it can be concluded that
Delivery is major concern for company which needs
immediate attention, as the average CSI for Delivery is
around 85-90% which is very less in comparison to Quality
and Delivery (92-96%) for both Long and Flat Products.
COMPLAINTS OBTAINED THROUGH CUSTOMERS
REGARDING QUALITY, SERVICE AND DELIVERY
74
8/6/2019 Laxmikant Bsp Project
75/91
Customer complaints regarding Quality
Poor quality of lamination
Off chemistry material
Problem of cracks in the products
Customer complaints regarding delivery:
Invoicing problem.
Information of the order status.
Loading of the materials in the wagon.
Customer complaints regarding services:
Poor performance of cross functional team.
Poor performance of Branch Sales office.
Delay in order confirmation.
RECOMMENDATIONS AND STEPS TAKEN BY SAIL (BSP) FOR
REDUCING THE FURTHER COMPLAINTS
For improvement of Quality:
Increased inspection of finished products.
Improvement in TMT bars according to customer
requirements.
Key structured customer meet at branch level(every month)Mason meets.
75
8/6/2019 Laxmikant Bsp Project
76/91
For improvement of Delivery:
Online service for invoice: From 2008-09 everyday at 6.00P.M. an email is generated which describes the invoice
details.
Improvement in wagon loading :
loading & unloading time is reduced and
Maximum uses of wagon capacity.
Introduction of freight operating information system (FOIS):
Through this every movement of the dispatched material istraced by all the branches through internet.
Provision of Enterprise Resource Planning.
Introduction of spot invoicing: Invoice is generated at the
same time and at the place of dispatch so that delivery time
gets optimised and reduces the unloading time at the
customers place.
No held up time.
For improvement of Service:
Intensify the dealer network: Covered almost all the districts
in the country (623/625 in India).
Rewarding the dealers.
After sales service:
Improving the invoice generation process.
Increasing the stockyards to handle the complaints
quickly.
76
8/6/2019 Laxmikant Bsp Project
77/91
SECONDARY PRODUCTS
Scraps generated inside Bhilai Steel Plant are termed as
secondary products, in the course of manufacturing process. In
every stage of production, always there will be certain
percentage of product which do not fit to the standard quality,
size & specification, such product are termed as secondaryproduct. Moreover, while shaping the prime product both end &
sides are cut, these extra materials are also categorized as
secondary product in SAIL (BSP) as they are re-rollable.
Secondary section started functioning after the commencing
of Bhilai Steel Plant. The secondary product section of the
marketing department is solely responsible for the selling of
secondary products and by products of SAIL (BSP). All the
defective/ rejected items: this department except the rejected/defective plates sells scrap. The defective plates are sold by
Central Marketing Organisation (CMO) since December 2001. The
secondary products are sold by online auction sale, tender and
fixed price sale.
Following items fall under the category of secondary products:-
Defective Heavy blooms.
Defective billets/ billets cutting. Defective/ Rejected slobs.
Plate mill side shearing.
Plate mill end shearing.
77
8/6/2019 Laxmikant Bsp Project
78/91
Defective/ Rejected rails.
Rails cutting.
Rod cutting.
Defective Rolled slabs from bloom and billet mill.
Iron scrap.
Spillage slag.
Blast furnace granulated slag.
Coal rejects, Coal chemicals
Bloom end cutting.
Necessity of Selling the Secondary Products
The net sales from all the secondary products, by products
and co-products of SAIL (BSP) are around Rs. 1591 crores in FY09
which is quite more than money the big industries. Out of this
steel scrap arising itself brings about Rs. 1290 crores of money
every year. Re-production of primary product from the secondary
product requires re-melting it again for the required composition
of the materials as per the desired specification.
By selling it to the different mills/traders/processors theplant earn a decent amount of money which is basically utilized
as working capital for day-to-day spending.
78
8/6/2019 Laxmikant Bsp Project
79/91
Profit is the main aim of every business and when the
realization of these products for the finished products proves to
be costlier the management plant decided to sell it to local
market. By selling secondary products to the local market new
industries are developed for re-rolling the secondary material to
make finished product. It has also increased the small-scale
industries and employment opportunities.
Marketing of Secondary Products
During the seventies and eighties when the plant was onemillion-tonnes and 2.5 million-tonnes of capacity respectivelyarising of secondary products were limited and such arising wererecycled for re-melting. Therefore there was no scope formarketing in other words it was not economical. The plantcapacity has been increased from 2.5 million tons to 4 milliontons in the late eighties. New technology has been adopted while
increasing the capacity of the plant where by the use of arisingfor re-melting drastically reduced. This has given more reasonsfor the marketing/selling of secondary products.
In the nineties we have seen lot of changes in the economic
scenario of the country. The concept of more employment in
public sector enterprises has changed to more profit. There by
the plant also has geared up its strategy towards this end. One of
the strategies adopted by the plant for increasing the profit ismarketing of secondary product. In the recent years a number of
foundries and re-rolling mills come into existence throughout the
country. These small-scale sectors need the secondary product
79
8/6/2019 Laxmikant Bsp Project
80/91
as input raw material for their production. The company has
engaged in educating them the use of secondary products for
different kinds of end products for consumption of general public.
The plant extends all types of facilities and assistance to these
small-scale units which in turn give scope for more employment
opportunities.
The plant for marketing has adopted following strategy following
strategy;
1. Committed delivery.2. Competitive price.3. Quick complaint settlement.4. Culture of customer service.
COMMITTED DELIVERY:-
Achievement of the goals of 100% fulfillment of contractual
obligation of delivery is important as customer must developconfidence that B.S.P. delivers in time. To ensure this appropriate
action is to be taken in the following areas:-
Movement of scraps & other materials from plant tocustomers.
Delivery of documents in time Monitoring.
CUSTOMISED PRODUCT MIX:-
Matching the product mix with the customer requirement is
the key to the customer satisfaction. B.S.P. has to ensure what
80
8/6/2019 Laxmikant Bsp Project
81/91
type of materials are required by customer and supply the
materials the customers needed.
COMPETITIVE PRICE:-
Success in a competitive market depends on competitive
advantage in terms of delivery & price. Competition from other
steel products is likely to increase in the context of recent
changes. This can be achieved only through continuous cost
reduction & improvement in pricing policies.
QUICK COMPLAINT SETTLEMENT:-
81
8/6/2019 Laxmikant Bsp Project
82/91
In this context the complaint from the customer comes to theBranch Sales Office (BSO) where it is handled in two phases:
In the first phase, the minor complaints are solved by theconcerned Application Enginee