Group 28

At the Helm: Reforging SAILA dreadful assignment

Group 28 SMP batch 12Shyam Sundar S, Bibek Singh, Shashank Shyam Abhyankar,

Ankul Mehrotra, Abha John Jitendra Charan, Rajeev Kumar Bhasin

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● Born on 14 Jan 1925● British Airfields as Technician In charge for electrical installation at Kolar and

Chettinad● Involved in design of several hydroelectric projects at Chennai Electricity Board● 1954 joined Planning commission as a research officer for Natural resources

division● Cleared UPSC, and joined Central engineering services, part of planning

commission● HE(I)L – a fledgling public sector company● Deputed as Manager at Trichy – BHEL, Chairman BHEL (Re-engineered BHEL)● Vice Chairman and Managing director at Maruti● 1985 Chairman – SAIL (At the helm of it due to Rajeev Gandhi’s request)

V. Krishnamurthy

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Leadership

Importance to people and treating them with dignity

Constant communication with

all stakeholders

Creating awareness of quality and productivity

Developing a marketing and

customer culture

Constantly upgrading the

technological status of the company

V. Krishnamurthy’s Management Philosophy

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● Actual Capacity utilization was 73% against Target of 85%● High inefficiency due to obsolete technology in all 5 plants● Hugely Overstaffed 250,000 direct employees on payrolls● Highly bureaucratic and hierarchical● Lack of leadership● Posted 320 crores of loss in 1982 - 84

SAIL – The dreadful assignment

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● People centric approach● Highly effective and constant

communicator● Productivity and Quality as

key pillars● Customer centric approach● Using technology to upgrade

the company

V. Krishnamurthy’s Magic – Reforging SAIL

Leadership

Importance to people and treating them with dignity

Constant communication with

all stakeholders

Creating awareness of quality and productivity

Developing a marketing and

customer culture

Constantly upgrading the

technological status of the company

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● “If we succeed, credit is yours; if it does not I will take the rap”

● Participatory approach towards to reforge SAIL

● Spent first 5 months visiting each plant meeting managers, union representatives and workers

● Organized drinks and dinner evenings, especially for the younger lot

● Arranged workshops for corporate managers level involvement in key discussions

● Priorities of Action plan drafted with the help of people

Importance to people, treating with dignity

“Each and every employee of SAIL should know about the mission of

the organization, its objectives and future plans so as to feel a sense of

pride and identification”

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● We were constantly talking to people, getting to understand their problems and seeking solutions

● Interactions across the organization to prepare a Priorities for Action document● Roped in 685 corporate managers-executives of the level of chief superintendent and

above to get their views● Divided them in groups of around eighty people and organized four days workshops for

intense discussions on all the key issues listed in the Priorities for Action document● These managers became messengers to take the message forward across the

organization● Convincing Unions: “It’s better to go through discomfort of a planned change than the

pain of a forced change.”

Constant communication with all stakeholders

“Modernization of the mind before modernization of machines became my mantra while managing SAIL”

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● Organization restructuring for improving productivity● Enabled collective thinking or policy making to improve productivity by

introducing the corporate planning divisions● Improved work culture by inducing discipline

◦ Reduced overtime bills by bringing in managerial level disciplines

◦ Exposed managers inefficiencies and pushed them to plan work well

◦ Took tough measures to reduce absenteeism from 38% to 5%

◦ Cross department deployments to improve utilizations ◦ Overlapping shifts to reduce productivity loss of 5-10%◦ Trimmed the workforce by schemes like VRS,

redeployment of existing staff on vacancies

Creating awareness of quality and productivity

“Everyone will be paid for the work done and not for the time spent”

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● Initiated an 8 hour shift for the marketing teams, gave some motivational incentives like subsidized lunch and more frequent interactions between families of executives and non-executives

● Increased overall efficiency led to faster deliveries and higher quantities of steel● Committed to customers for no price increase for next three years● Educated SAIL employees that the success of any business depended on how

efficiently it can give the customer what he wants● Changed distribution mindset to marketing mindset● Three principles of marketing for SAIL

◦ Absorb all costs within its control◦ Commit to delivery schedules or pay penalties◦ Replace supplies if complaints about quality

Developing a marketing and customer culture

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● Time bound supply scheme started in 1985 to commit to supply a certain percentage of supply within certain time schedule

● If not delivered, pay penalty of 3.5-4% to the customer● Customers were appreciative of this gesture in a supply

constrained market

A Chennai based customer producing large machinery, KCP, returned the cheque bearing the penalty payment, saying this gesture was good

enough and that he did not want the money

Developing a marketing and customer culture

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● Implemented the marketing MIS (Management Information System) to curb the demand and supply gap

● Introduced the stockyard modernization program to better the turnaround time of trucks that came to take deliveries and avoid congestion at stockyards

● Investment in computerization and wireless communication network linking all the plants and stockyards with each other to track movement of wagons

Constantly upgrading technological status of SAIL

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● Modernized the mind before the technology

● Facilitated employees to British and Russian steel plants to get an idea of modern production systems and equipments

● Drew the Technology Plan and Technology Committee set up to oversee the modernization program

● Covered revamping old equipment, upgrading technology and reducing energy consumption and introduce new processes

Constantly upgrading technological status of SAIL

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Thank you!❑ Shyam Sundar S❑ Bibek Singh❑ Shashank Shyam Abhyankar❑ Ankul Mehrotra❑ Abha John Jitendra Charan❑ Rajeev Kumar Bhasin

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