Weir Minerals India

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Driving growth, the Weir Way:

�Innovative Action

�Collaborative Mindset

�Global Capability

�Value chain excellence

Weir Minerals India

Surendra Menon,Business Head, Weir Minerals India

CII Cost Congress, 28 th November 2013

Weir Minerals India

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Weir Group: over 140 years of engineering legacy…

A host of brands acquired and associated

1872G&J Weir formed•1881 – Direct action pump patented•1884 – First land based desalination plant (Egypt)

1900A diverse business•1912 Pipeline for Anglo Persian oil company•1924 Pre-fabricated housing •1926 Autogiro development•Ammunitions for WWI & II

1946Going public•1947: G&J Weir listed on LSE•1967: The Weir Group formed•1969: Weir Pumps Ltd formed

1980�Acquisition trail: LGE Process, Hopkinsons, Atwood & Morrill, Allen Gwynnes, Floway, Envirotech , Batley, SPM, MESA, GEHO, WARMAN

2001Business transformation & restructure

2008New group structure & New agenda

1872G&J Weir formed•1881 – Direct action pump patented•1884 – First land based desalination plant (Egypt)

1900A diverse business•1912 Pipeline for Anglo Persian oil company•1924 Pre-fabricated housing •1926 Autogiro development•Ammunitions for WWI & II

1946Going public•1947: G&J Weir listed on LSE•1967: The Weir Group formed•1969: Weir Pumps Ltd formed

1980�Acquisition trail: LGE Process, Hopkinsons, Atwood & Morrill, Allen Gwynnes, Floway, Envirotech , Batley, SPM, MESA, GEHO, WARMAN

2001Business transformation & restructure

2008New group structure & New agenda

Weir Minerals India

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� 200 manufacturing and service facilities� Over 14,360 Employees worldwide� Market capitalisation (approximately) £3.5bn FTSE 85th position

Order Input £2,397m

Revenue£2,538m

Operating Margin 19.1%

2012 Results

Group overview today – globally established business

The FTSE 100: Is top100 companies listed on the Lo ndon Stock Exchange with the highest market capital ization

Operating Profit£486m

Weir Minerals India

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Three sector focused divisions

Weir Minerals India

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• Serving Indian market since 1978• Significant player in the industrial valves market for

O&G, Power and Industrial sectors• Leading supplier of diaphragm valves;• Plant located in Hubli, with 12 sales offices• Strong EHS, CSR Practices

• Established in 2003 as WMI• Manufactures pumps, valves, cyclones, mill liners,

screens & other minerals products• Strong life-cycle extension services• 260 people; 4 plants (Bangalore), 10 sales offices

Weir India: serving the Indian industry for over a decade

• Innovative engineering solutions• Centre of excellence in product development, engineering

analysis, plant engineering, etc.• Office based in Bangalore

Weir BDK Plant

Minerals Plant

Services facility

EnSci Office

Weir India Regional Offices

Minerals Service Centre

Footprint •32 Distributors•14 Sales Offices•2 Service Centers

Weir Minerals India

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Weir Minerals India: the business today

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Product portfolio for mineral processing industry

Val

ves

Pum

ps

Cyc

lone

s

Mill

Lin

ers

Rub

ber

prod

ucts

Min

e-de

wat

erin

g

Scr

eens

Weir Minerals India

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Markets served and key customersWeir Minerals India: the business today

Weir Minerals India

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Weir Minerals India: Business Processes established in 10 years

Weir Minerals India

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Strategic focus towards cost managementWeir Minerals India: the business today

Core Competencies

Product Engineering

Supply Chain Development

Innovation Management

Operations Excellence

Differentiation of product by being unique with the ability to exploit new trends in specific segments.

Com

petit

ive

Adv

anta

ges

Sustainable Competitive Advantage

Cost Focus through delivering cost advantage for each target segment viz. Minerals, Power and Gen. Indl.

CostFocus

DifferentiationFocus

Weir Minerals India

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Depth in strategy developmentWeir Minerals India: the business today

Policy Deployment Matrix

Risk Dashboard

Competitive AnalysisScenario Analysis

TCM Focus: Factoring structured TCM framework to overall strategy formulation for cost leadership. Integrate cost measurement into strategic processes – new customer solutions, new markets, convert PDM to action plan with Cost Management

Weir Minerals India

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Delivering engineering excellence for enhancing value proposition

Product development�NPD structure�Collaboration with EnSci�Leveraging Weir technology & know how

Valves Design Center of Origin (DCO)�A well established DCO since 2011;�Current program includes 30 global projects in the hopper - twelve completed, nine active , one in-active and eight road map projects;�Key product releases:

• New generation Pinch valves;• Expansion of WB series;• High pressure WH series.

Innovation�Six patents (P)

• KGV sleeve design;• PU-Ceramic wet end;• One piece ceramic impeller;• Build process for ceramic impeller.

�Six more claims under review

VA VE initiatives�Product rationalization;�Part count reduction;�Weight optimization;�Part proliferation;�Design optimization.

Weir Minerals India: the business today

TCM Focus: Support in ‘cost of developing new product linked to RFQs’, attempt value proposition to customer in a product, Structured target costing methodology to be attempted.

Weir Minerals India

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Order to Cash VSM

Lean in Finance BP*

#REF!#REF!#REF!#REF!#REF!#REF!#REF!#REF!#REF!#REF!

31-Jan-13

Weir Lean Assessment for Finance Function

WMI

Dec-13#REF!Current Self

Assessment Score- Jan 2013

Prior Year End Score 2012

81%#REF!53% 54%Lean Finance Scores (%)

0

1

2

3

4

5Cultural Awareness

Visual Management &Housekeeping

Standardisation of work

Flexible Operations

Continuous Improvement

Accuracy

Data & Resource Management

Responsiveness to deadlines

Customer Service

Level Through Put

Self assessment Score

Dec-13

Prior Year

Net Promoter Score

5

26

23

33

34

43

63

40

34

2012

2011

2010

% Detractor

% Passive

% Promoter

E Quote System

Function wise kaizen mapping

Business & operational excellenceWeir Minerals India: the business today

Weir Commercial systems

Audit date: 5/23/2013

Audit2010

no KPIs

Target H1-2011no KPIs

This AuditNO KPIs

This Audit with KPIs

New Targetno KPIs

New Targetwith KPIs

92% 86% 88% 87% 0% 0%

Weir Commercial Assessment

WM IndiaWCS Score (%)

0

1

2

3

4

5

6

7

8

9

10

Weir CustomerExperience

CommercialFocus

CompetitorsKnowledge

CustomerKnowledge

MarketKnowledge

PricingKnowledge

5/23/2013

Target H1-2011

Audit2010no KPIs

New TARGET

Level3 (8-10)

Level2 (5-8)

Level1 (0-5)

0.0 1.0 2.0 3.0 4.0

MarketShare

Return Rate

KPIs Score*(range 0-4) 5/23/2013 New TARGET

TCM Focus: Value stream costing, product cost analysis for product weight reduction, roadmap to fix model wise cost reduction

Weir Minerals India

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This Audit,no KPIs

This Audit,with KPIs

New Target,no KPIs

New Target,with KPIs

91% 89% 96% 95%

Weir Lean Assessment 20/03/2012

Lean Score (%) Weir Minerals India

0

1

2

3

4

5

6

7

8

9

10

Deploy…

Cultural

Awaren…

Visual

Mngt &…

Standard.Work

Flexible

Operati…Conti

nuous

Im…

Error Proofing

Quick

Change…

TPM

Material

Control

LevelProductio

n

THIS AUDIT20/03/2012

New Target

Level1 (0-5)

Level2 (5-8)

Level3 (8-10)

`

0

1

2

3

4

5

6

7

8

LTAs OTD Inventory Turns

KPIs

THIS AUDIT20/03/2012 New Target

Weir Production System

Machining BP*

Logistic BP*

* BP : Best Practices

Lean at VendorsWeir Procurement System

Purchasing KPI

Business & operational excellenceWeir Minerals India: the business today

TCM Focus: Strategic levers for material cost reduction, deep dive analysis for variation in resource analysis, technology based predictive cost structure, TCO (Total Cost Ownership) incubation

Weir Minerals India

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Urgency to adopt TCM framework

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• Slowing down of investments in domestic projects• Mining regulations by Supreme Court• Export markets slowing down owing to global

slowdown

Economic Scenario

• Highly competitive – buyers market• Price competitiveness• Diminishing product differentiation• Fragmented market• Poor acceptance of total cost of ownership concept

Industry Scenario

Strengthen key processes:•Engineering excellence•Operational & delivery excellence•Services•Supply chain excellence

Strategic need

Prepare the organisation for sustained competitiveness through a

matured & scientific approach to meet the strategic ambition of growth

Weir Minerals India

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Engaging with TCM

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• Identify key efficiency linkages & levers to create sustainable competitive advantage and customer value proposition

• Benchmark the enterprise in cost management

• Improve processes to create sustainable cost advantages

• Create a roadmap to inculcate a cost culture and move forward on cost management process

MinimalMinimal

FunctionalFunctional

OperationalOperational

TCM EnabledTCM Enabled

ExemplaryExemplary

Defined objectives

Total Cost Management Maturity Model

Weir Minerals India

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Thank You!

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