Visakhapatnam Steel Plant

Principles of Management project report

on
Visakhapatnam Steel Plant
Introduction
Visakhapatnam Steel Plant, popularly known as Vizag Steel is
integrated steel plant in Visakhapatnam, India built using German
and Soviet technology. Its products have been rated the best in
the world market. The company has grown from a loss-making
industry to 3-billion-dollar Turnover Company registering a growth
of 203.6% in just four years. Vizag Steel Plant was conferred
Navratna status on 17 November 2010. Founded in 1971, the
company focuses on producing value-added steel.
Vizag Steel Plant is the only Indian shore-based steel plant and is
situated on 33,000 acres (13,000 ha), and is poised to expand to
produce up to 20 MT in a single campus.
Right now the company is operating at a capacity of 6.3 Mtpa and
aims to achieve a capacity of 7.3Mt by 2017-18.
Products include Blooms, Channels, I-beams, Vizag TMT, Angles,
Billets, Rods, Rounds and Wire Rod Coils.

Vision 2015

To be the most efficient steel maker having the largest single

location shore based steel plant in the country.
Being
single
location
Company,
with
product
mix
exclusively of longs, handicapped due to lack of captive mines for

major raw materials and equipment operating at above rated
capacities since more than a decade now, RINL has a unique
portfolio of risks and opportunities.
Initiatives addressing the same are crucial for companys
profitability in current time frame and also for sustainable
performance in the time to come.
Objectives
Achieve Gross Margin to Turnover ratio > 10%.
Plan for finishing mill to integrate with 7.3 Mt capacity and
commission the same by 2017-18.
Achieve rated capacity of new & revamped units by 2017-18.
Capture markets for high-end value added products by
focusing on sector specific applications and customer needs.
Achieve leadership in Energy consumption by achieving 5.6
Gcal/tcs by 2017-18.
Globalization of operations through acquisition of mines and
setting up of marketing network abroad.
Diversify through operationalizing of Bhilwara Mines, setting
up of Pelletization plant, DRI-EAF unit, Wheel & Axle Plants.
Create a high performance and safe work culture by
nurturing talent and developing leaders.
To grow in harmony with the environment & communities

around us
Chief Managing Director (CMD)

Sri P Madhusudhan, Director (Finance) assumed charge as
the 9th Chairman-cum-Managing Director of Rashtriya Ispat
Nigam Limited, the corporate entity of Visakhapatnam Steel Plant
today. Sri Madhusudhan joined RINL as Director (Finance) in 2009
and played a significant role in financial performance of the
Company and pioneered in introducing of e-payments to the
customers/suppliers which was widely acknowledged in the entire
Indian Steel Industry.
Sri Madhusudan will be at the helm of affairs at RINL for the
next five years, as the Company is planning to expand the
capacity to reach to 11-12 mtpa and aspiring to become a
Maharatna Company soon. While addressing a gathering of
senior officers in Ukkunagaram today on the occasion of New
Year,
Sri
Madhusudan
observed
that
the
expansion
and
modernization of the units, the commissioning of Finishing Mills &

the early stabilization; ramping up of production (beyond rated
capacity) from the new Blast Furnace & Steel Making Shop; timely
completion of Category-1 capital repairs of BF-1 & its stabilization;
modernization of SMS-1; preparing BF-2 for Category-1 capital
repairs; timely order placement for modernization of Sinter Plant1; order placement of Coke Oven Battery-5; augmentation of
power generation to meet the enhanced requirements, etc. are

some of the major challenges and expressed confidence that RINL
collective has potential to deliver.
The new CMD visualized a very bright future for the plant
and said utmost priority shall be given for adopting cost control
measures across the plant. He said that with the slowdown in
economy, there is a tremendous squeeze on the margins of RINL,
and he called upon all the HODs to sensitize the cost culture
across the organization to improve the bottom-line.
Generation of adequate surpluses has become mandatory to
fund the modernization of equipments and unless concrete
measures are taken, the progress of our growth is likely to get
hampered, he observed.
He stressed the need to device methods to work collectively
and weed out processes that extract most of our production time.
The
collective
working
should
be
supplemented
with
an
intellectual and emotional commitment that ensures consistency,

constancy, growth and opportunity to exhibit our untapped
potential, said Sri Madhusudan. Sri Madhusudan, a top class
Chartered Accountant in profession, played an effective treasury
management including obtaining low cost funds to RINL both in
working capital as well as long-term funds required for capital
expenditure during the expansion of the Navratna Company.
He was very instrumental in hedging the FOREX risks and
ensured minimum impact of rupee/dollar fluctuations. Sri Umesh
Chandra,
Director
(Commercial),
Sri
(Operations),
YR
Reddy,
Sri
Director
TK
Chand,
Director
(Personnel),
Sri
PC
Mohapatra, Director (Projects), Sri B Siddhartha Kumar, IFS, CVO

highlighted the achievements in their respective areas on the
occasion and stressed the importance of achieving, sustaining the
rated capacity and stabilization of production from the new units.
Corporate and competitive strategy

RINL has a land bank of around 20,000 acres which is suitable for
expansion
up
to
20
Mtpa
at
Visakhapatnam.
Also,
the
infrastructure of two major ports in the vicinity and connectivity

by rail and National Highway coupled with projected growth in
infrastructural development in the country makes expansion at
Visakhapatnam a highly attractive proposition.
Expansion works for 7.3 Mt stage are already under way and plan
for next phase of expansion up to 11.7 Mt stage is being
developed. At RINL, leadership focus has always been on ensuring
alignment across the organization by evolving action plans and
initiatives at every level to achieve Company Objectives. This is
done through an elaborate Sustainability Planning exercise carried
out annually, that results in development of 5 year roll on plan
with emphasis on initiatives for the current year.
In line with the efforts to integrate Sustainable Development with
business strategy, the Sustainability Plan addresses various
aspects
of
technology
initiatives,
Sustainable
up-gradation,
initiatives
for
Development
energy,
like
expansion
environment
enhancing
employee
and
and
safety
involvement,
market development, raw material securitization, R&D plans and

CSR initiatives apart from initiatives addressing profitability
concerns of the organization during the year.
The Company continued its strategic initiatives, towards business
diversification and raw material securitization by signing MOUs
with Andhra Pradesh Mineral Development Corporation and Indian
Railways. Efficiency in energy consumption has been the strength
of RINL since inception, which has been made possible through
adoption of green technologies.
In order to further build on this strength, the company adopted
Energy Management Standard BSEN 16001 in 2010-11 and
migrated to ISO 50001 for Energy Management in 2012-13 and
RINL is the first in Indian Steel Industry to get this certification.
This provides uniform thrust on energy audits and improvement
plans across the company.
Sustainable
Development
policy
was
formulated
so
as
to
internalize DPE guidelines on SD. As part of the policy framework

aspects related to identification, implementation, review and
evaluation of SD projects have been addressed and three tier
monitoring mechanism has been put in place.
My observations and opinion

PROBLEMS:
Rehabilitation of displaced employees
Multiple labor unions
Lack of managerial turnover and competition
In my opinion, the above problems can be solved in the following
ways:
1. The
labor
unions
is
usually
headed
by
one
such
charismatic(more often than not)person who just wins the

admiration of the laborers by saying what they want to hear
and the best part is he like the other employees has his
individual need which eventually overshadow the needs of
the union
The laborers being the lower cadre of the society
generally demand only the enhancement of their basic
needs
the best way to up ease them is to provide a part or
percentage of what they need and the promise that the
rest will be provided based on the performance of the
company the company must recruit a lobbiest who will
use his talent to speak , to cover the attention of the
laborers
2. The displacement of workforce can be removed by using

various personality and skill assessment tests which can be
conducted by way of some new recreational projects or by
strictly administering them in a formal way
The results of these tests have to be used to allocate
the right job for the right person
having done the above function we can solve the
problem of motivation by giving the workforce the work
they are good at
3. It is a pity that the executives who are almost 60%of the
workforce are not able to show efficiency despite the huge
advantage
in
numbers
their
performance
has
to
be
monitored and new recruits are to be employed based on a

proper analysis of their skills and weaknesses the concept of
a good incentive system is more often than not referred to as
regards the laborers but not much is mentioned as regards
the executives
4. The executives have to be given proper incentives based on

their performance one has to keep in mind that it is the job
of the executives to ensure or to monitor the plan at
penultimate stage of implementation
5. Statistics show that the Russian companies using the same

machinery produce 8000 tons of steel per day as against
6000 tons produced by vizag steel
6. The goal of 30,00,000 tons per year can be achieved only by

producing about 8500 tons of steel a day therefore the
production has to be monitored from the raw material stage
to the finished product stage wastage has to be properly
accounted for and the byproducts have to be utilized and
sold with the same care and importance and the main steel
itself
7. There has to be a proper collaboration with the research
institutions , and the new advancements in the techniques
and technologies has to be implemented properly
8. By rectifying the problems of the workforce an great deal of

efficiency and effectiveness can be achieved therefore
increasing the profits by reducing the price
9. A bias for action: a preference for doing something

---anything rather than sending a question through cycles
and cycles of analysis and committee reports. Staying close
to the customer: hearing his or her preferences and catering

to them

Visakhapatnam Steel Plant

Uploaded by

Copyright:

Available Formats

Visakhapatnam Steel Plant

Uploaded by

Document Information

Original Description:

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Visakhapatnam Steel Plant

Uploaded by

Copyright:

Available Formats

Principles of Management project report

To be the most efficient steel maker having the largest single

exclusively of longs, handicapped due to lack of captive mines for

To grow in harmony with the environment & communities

Chief Managing Director (CMD)

modernization of the units, the commissioning of Finishing Mills &

power generation to meet the enhanced requirements, etc. are

intellectual and emotional commitment that ensures consistency,

Mohapatra, Director (Projects), Sri B Siddhartha Kumar, IFS, CVO

Corporate and competitive strategy

infrastructure of two major ports in the vicinity and connectivity

market development, raw material securitization, R&D plans and

internalize DPE guidelines on SD. As part of the policy framework

My observations and opinion

charismatic(more often than not)person who just wins the

2. The displacement of workforce can be removed by using

monitored and new recruits are to be employed based on a

4. The executives have to be given proper incentives based on

5. Statistics show that the Russian companies using the same

6. The goal of 30,00,000 tons per year can be achieved only by

8. By rectifying the problems of the workforce an great deal of

9. A bias for action: a preference for doing something

to the customer: hearing his or her preferences and catering

You might also like