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?

59

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

65

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