WELSPUN GUJARAT PRODUCTION OPERATION MANAGEMENT

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Tolani Institute of Management 1

Welspun gujarat

stahl Rohren Ltd


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INDIAN PIPELINE INDUSTRY

Among the top three manufacturing hubs after

Japan and Europe.

Penetration level of pipelines in oil & gastransportation is low at 32% in India as

compared to 59% in USA and 79% globally

Highly Raw Material intensive with the RM

cost more than 70% of the total cost


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Low-cost quality products and various

certifications, Indian companies have augmented

their export sales over the last three to four years.

The global export market of the steel pipes is

stated to be close to $27 billion a year with theUS, Western Europe, Australia, and Japan being

the biggest importers. India is one of the major

exporting nations including Indonesia, Malaysia

and Thailand.


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Freight cost high due to higher imports and

exports.

The building & construction industries along

with the oil & gas sector are the major

marketplaces for pipe.

High oil and gas discoveries worldwide,

increased efforts by the Government of India

on infrastructure development.


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Demand of Pipelines

Demand is expected to be in excess of 3000 Km per Annum which would be more

or less in line with the total domestic capacity (Post expansion).


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Birth of a global pipe making

The Indian pipe majors Welspun Gujarat, Jindal

Saw, PSL, Man Industries and Ratnamani Metals

and Tubes set up their plants in the region to reach

a combined capacity of around 1 million tones per

year and likely to double it in near future.


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INTRODUTION TO WELSPUN

Strong culture of Engineering Excellence

Set to be positioned as the World's Largest

Pipe Company with an increase in capacity

from 1 million ton per annum to 1.75

million ton per annum by March 2009.


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Timely communication to

Target stakeholders in a

Transparent fashion

MISSION


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VISION


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Awards/Recognition


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CUSTOMERS OF WGSRL

Global Customers

British petroleum

Chevron

TransCanada

Lone star

(Bangladesh) Etc.

Domestic Customers

GSPL

GGCL

Reliance

GAIAL

IOC

Jay Somnath Etc.


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MAJOR SUPPLIERS OF WGSRL

Most Important Raw Material = Coil

So major supplier for WGSRL are:-

ESSAR Steel

ISPAT Steel

POSCO


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COMPITITORS OF WGSRL

Jindal Steels

MAN Industries

PSL

Ratnamani Metals and Tubes ROD Etc.


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WGSRL

Manufacturing Bending Coating

LSAW ERW Spiral/HSAW

S1 S2 S3


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Production Flow Chart of

Spiral-3


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Flow Chart

ofCOATING


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Concepts

ofPOM


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Competitive priorities:

Top quality

Consistent quality

On time delivery

Customization

Volume flexibility


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Core competencies:

Speed of production (150 pipes per day)

Quality

Employees (around 3000)

Backward integration

(captive in-house power and raw material)


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Batch Process:

Reasons for this:

More Variety

Moderate Volume

Average Quantity


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Make to order strategy:

Customized Product

Moderate Complexity & less Divergence

High Capital Intensity

Reasons for this:

Fixed Automation

Little Human Intervention

Latest technology


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LOCATION ADVANTAGES

Easy Availability labor at less cost

Tax benefits like excise duty exemption,

income & sales tax holiday for Kutch after the

earthquake in 2001.

Excellent logistics for import of steel, iron ore

and coal as well as export of pipes with all

season Kandla and Mundra port in the vicinity.


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Availability of hassle free land at reasonable

prices.

Indigenous availability of raw material.

Nearer to supplier


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Process Layout

Line-flow Layout & Fixed Position Layout:

Linear PathFixed Manufacturing Site


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Inventory Control System

Periodic Review System

Reasons for this:

No uncertainty in Demand

No Constraint on lot size

Review Period = 30 Days

Order is received in 3 parts

2% additional for Safety against loss


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Cont.

Supply Chain Strategy: Efficient

Reasons for this:

Predictable demand & low forecastingerrors

Competitive priorities are low cost,consistent quality, on-time delivery

Infrequent new product introduction


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Cont.

Mass Customization:

Highly Customized Product

Low Cost

Benefits of Mass Customization:

Managing customer relationships

Eliminate finished goods inventory

Higher perceived value of product


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Cont.

Backward Integration:


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Capacity Related Discussion

Current Capacity : 150 Pipes/day

No Capacity Cushions:

Reason For this: 2 years Orderin hand

Expansion:

Domestic Expansion

Global Expansion: Plant in Little


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LEAN SYSTEM @ WGSRL

Pull method of Workflow

Quality at source

Small lot size(Maximum 50/lot)

Uniform Workstation load(150 pipes/day)

Standardized Components & Work Method


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Cont.

Backward Integration for Less Inventory Slack

Flexible Workforce

Automation

Continuous Improvement With

Lean System


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Other concepts.

Very Less Bullwhip Effect

Centralized Inventory Placement

system

Bottleneck Management

Past Bottleneck Production

Capacity


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Quality Control

ISO 9001 - By

PIQR

API 5L (Line Pipes)

API 5CT (Casing)

API 2B (Tubular)

ISO/TS 29001

Certifications:

ISI by Bureau of

Indian Standards

ISO 14001 by LRQA

OHSAS 18001 by

LRQA

Six Sigma certificate.


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TQM @ WGSRL

Customer Satisfaction:Conformance to Specifications

Value

Fitness for usePsychological Impression

Employee Involvement

Quality at the SourceEmployee Empowerment

Continuous Improvement(Kaizen)


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Quality Procedure

Handling of Coils by C hookFrom storage to mill the coils are lifted by 30 Ton

crane

Handling of pipe inside the plant:

Rolling of the pipes on the level beds and

racksRubberized surface to prevent scratch


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Cont.

As per the specifications of the

customer testing are done at the

different places.

Finished goods are stocked in stand

for storage.


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WELSPUN GUJARAT PRODUCTION OPERATION MANAGEMENT

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