Digital Transformation: A case study on tata steel

Digital Transformation: A case study on tata steel

• 1.
  Sameer Joshi PRN103 Neeraj Kalekar PRN105 DeveshJadhav PRN101 Vaishnav M PRN097 Harender Singh PRN099 Rahul Dandge PRN096 Diksha Waghmare PRN098 Revati Jadhav PRN102 Indrajeet Hulyalkar PRN100 Jyotsna Bajpai PRN104 3
• 2.
  Sameer  Tata Steelwas created in 1907 by Jamshedji Tata and is a component of the Tata Group  Consolidated turnover of US $32,836 million in the financial year ending March 31, 2022  10th largest steel producer in the world with an annual crude steel production capacity of 34 MnTPA • Agriculture • Automotive Steels • Construction • Consumer Goods • Energy and Power • Engineering • Material Handling • Hot Rolled Steel • Cold Rolled Steel • Coated Coil • Tubes • Rebar • Wire Rods For the 2022 financial year, the total turnover of Tata Steel Limited was about 2.4 trillion Indian rupees. This was an increase of about 56 percent in comparison to the previous financial year  Integrated operations in India  Product portfolio  Overdependence on Europe  Disintegrated operations in Europe  Adapt newer technologies  Increasing demand in India  Government & Environmental Regulations  Decreasing steel prices
• 3.
  Vaishnav  Limited availabilityof raw materials (coal, crude steel etc.)  Shift in product quality ( Ultra high strength steel for automotives)  New steel grades ( TRIP & TWIP)  National steel policy by ministry of steel • Subsidiaries: JUSCO, Tata Pigments, TS Alloys, TSPDL etc. • Joint Ventures • Tata sons • Major shareholders Supply Chain Management Procurement, Storage, Maintaining Inventory, Order Delivery Manufacturing Raw material mining, Hot Material production, crude steel production Order Fulfillment Resource planning, Order allocation, optimum delivery route Managing finance Marketing and Quality management Supplier Compatibility Customer needs Customized Offerings • Financial • Manufacturing • Intellectual • Human • Natural capital CSR Initiatives Customer feedback networks & Support Vendor Capacity Advancement Programme Other business Raw materials value chain Steel value chain B2B B2ECA B2C through Distribution  Automotive  Construction  Finished goods  General engineering  Manufacturing  Salaries & wages  Technology  Warehousing  Marketing
• 4.
  Diksha 01. How tohandle the projected increase in steel demand?  India’s apparent steel use per capita stood at 70 kg in 2018  India has a huge potential for steel demand growth.  Rapid urbanization, increasing population, and infrastructure development.  Government initiatives - ‘Make in India’ will provide impetus to growth in steel demand. • Evolving consumer needs • The demand for automobiles, white goods and other consumer goods is also increasing • Tata Steel Jamshedpur is a national benchmark in CO2 emission. • There is growing regulatory requirement to reduce carbon emission. • Large opportunity for new materials • Tata Steel aspires to be a technology and innovation leader in the industry, and create new businesses in high-potential alternate materials
• 5.
  Rahul • Advanced industrialIot for process optimization. • Al- powered processed control • Cycle time optimization through big data analytics on lines programmable logic controllers • Digital twin for flexible production • Real- time locating systems (RTLS) for key manufacturing components • Analytics platform for remote production optimization. • Digital dashboards to monitor overall equipment effectiveness performance. • Enterprise manufacturing intelligence system to upgrade operations management. • Real time asset performance monitoring and visualization • Digital twin of sustainability • Energy optimization by predictive analytics • Iot real-time energy data aggregation and reporting dashboards • Sensor based data collection for energy management Business Transformation Digital Solution @TATA Steel Work with Start-up with ambition Depth of capabilities
• 6.
  Neeraj • Data productmimicking data lake • Providing customized UI as well as integration with our Azure cloud
• 7.
  Inadequate controls inoperating procedures leading to interruption in operational processes. Logistics constraints due to inadequate rail, road and sea infrastructure may lead to disruption in operations Breach of information security incidents leading to business disruption and damage to reputation. Non-compliance to IT legislations and regulations leading to penalties Withdrawal of favorable trade measures such as minimum import prices, antidumping laws, countervailing duties and tariffs, trade restrictions may impact profitability Non-compliance in implementation of safety laws and regulations, which may lead to stoppage of operations Jyotsna
• 8.
  Devesh  Reduce timein traceability  Increases energy & workforce efficiency  Improve OEE and proactive actions  Reduce assembly line downtime  Measurement of Corrective Actions to Customer Issues  Reduction of Returned Materials  Lead Time Reduction  Conformance with Outside/Government Regulations  Reducing energy consumption  Reducing waste  Material substitution
• 9.
  Revati Product Beta Release Smart Contract Creation Implementationof Identified Use Cases Use case exploration & Prioritisation March 2023 July 2023 October 2023 January 2024
• 10.
  Indrajeet Platform Selection Manufacturer &Supplier Search Initiate agreement with smart contracts Supplier uploads documents Smart Contract Creation Tagging of materials with RFID Manufacturer tracks the production line Add QR code & RFID chips to package Create smart contract agreements with verified distrib. Shipment Tracking Tracking from distributor end Shipping the products to retailer Retailer tracks the shipment Product Delivery Application for end customer The customer tracks the order through QR code
• 11.
  Assumptions: 1. Teams takea 12-month time to develop and integrate these use cases. 2. A team of 11 consisting (of 5 developers, 4 for integration, and 2 consultant.) 3. Team Salary (Developers-2000000 ctc, Integration-1300000 ctc, and Consultant-3000000 ctc) Company Data Rate Required rate of return 10% Tax rate 30% Development Costs involved for use cases YEAR 2023 2024 2025 Development team salaries ₹ 1,00,00,000.00 Integration team ₹ 52,00,000.00 Consultant fees ₹ 60,00,000.00 Total Initial Investments ₹ 2,12,00,000.00 Assumptions: 1. Already we have 200 customers, we can provide service with improved traceability and transparency. 2. 30 new client-transaction for 1st year, 50 new clients for 2nd year, and 70 new clients for 3rd year. 3. They will charge 100000 more for the implantation for each customer transaction Benefits from Blockchain YEAR 2023 2024 2025 Increased sales from existing customer ₹ 2,00,00,000.00 ₹ 2,30,00,000.00 ₹ 2,80,00,000.00 New customer sales ₹ 30,00,000.00 ₹ 50,00,000.00 ₹ 70,00,000.00 Total Benefits ₹ 2,30,00,000.00 ₹ 2,80,00,000.00 ₹ 3,50,00,000.00 Haren
• 12.
  Assumptions: 1. Customer supportteam of 1 for first year, 2 for second year and 3rd year. (400000 per year) 2. Companies should spend 8% of their total revenues on marketing. Costs (Excluding Initial Capital Investments) YEAR 2023 2024 2025 Project management, customer support ₹ 4,00,000.00 ₹ 8,00,000.00 ₹ 8,00,000.00 Marketing Expenses ₹ 1,00,000.00 ₹ 1,00,000.00 ₹ 1,00,000.00 Other Expenses ₹ 50,000.00 ₹ 50,000.00 ₹ 50,000.00 Depreciation on capital expenditures (calculation uses three-year period) ₹ 70,66,666.67 ₹ 70,66,666.67 ₹ 70,66,666.67 Total Costs ₹ 76,16,666.67 ₹ 80,16,666.67 ₹ 80,16,666.67 Totals YEAR 2023 2024 2025 Net Benefits (Costs) ₹ 1,53,83,333.33 ₹ 1,99,83,333.33 ₹ 2,69,83,333.33 Tax ₹ 46,15,000.00 ₹ 59,95,000.00 ₹ 80,95,000.00 Value after tax ₹ 1,07,68,333.33 ₹ 1,39,88,333.33 ₹ 1,88,88,333.33 Depreciation added back ₹ 70,66,666.67 ₹ 70,66,666.67 ₹ 70,66,666.67 Cash flow ₹ -2,12,00,000.00 ₹ 1,78,35,000.00 ₹ 2,10,55,000.00 ₹ 2,59,55,000.00 Cumulative cash flow ₹ -2,12,00,000.00 ₹ -33,65,000.00 ₹ 1,76,90,000.00 ₹ 4,36,45,000.00 Evaluation Metrics Values Net present value (NPV) ₹ 3,19,14,838.47 Internal rate of return (IRR) 78.32% Payback period (in years) 1.16 Accurate ROI of 150.5% *with above state assumptions Haren
• 13.
  CREDITS: This presentationtemplate was created by Slidesgo, including icons by Flaticon, infographics & images by Freepik Do you have any questions? harender.singh@siom,in +91 9812969049
• 14.
   https://www.statista.com/statistics/755155/india-turnover-of-tata-steels/  https://www.tatasteel.com/products-solutions/india/ https://www3.weforum.org/docs/WEF_GLN_2021_Reimagining_Operations_for_Growth.pdf  https://www.tatasteel.com/investors/integrated-report-2018-19/risk-and-opportunities.html  https://online.hbs.edu/blog/post/how-to-calculate-roi-for-a-project  https://www.cisin.com/coffee-break/enterprise/blockchain-development-how-much-time-and-cost-does-it- require.html  https://www.leewayhertz.com/cost-of-blockchain-implementation/
• 15.
  Tata Steel -BlockChain Implementation Cost Benefit Analysis 20-Mar-22 Company Data Rate Required rate of return 10% Tax rate 30% Assumptions: 1. Teams take a 12-month time to develop and integrate these use cases. 2. A team of 11 consisting (of 5 developers, 4 for integration, and 2 consultant.) 3. Team Salary (Developers-2000000 ctc, Integration-1300000 ctc, and Consultant-3000000 ctc) Development Costs involved for use cases YEAR 2023 2024 2025 Development team salaries ₹ 1,00,00,000.00 Integration team ₹ 52,00,000.00 Consultant fees ₹ 60,00,000.00 Total Initial Investments ₹ 2,12,00,000.00 Assumptions: 1. Already we have 200 customers, we can provide service with improved tracibility and transparency. 2. 30 new client-transaction for 1st year, 50 new clients for 2nd year, and 70 new clients for 3rd year. 3. They will charge 100000 more for the implemtation for each customer transaction Benefits from Blockchain YEAR 2023 2024 2025 Increased sales from existing customer ₹ 2,00,00,000.00 ₹ 2,30,00,000.00 ₹ 2,80,00,000.00 New customer sales ₹ 30,00,000.00 ₹ 50,00,000.00 ₹ 70,00,000.00 Total Benefits ₹ 2,30,00,000.00 ₹ 2,80,00,000.00 ₹ 3,50,00,000.00 Assumptions: 1. Customer support team of 1 for first year, 2 for second year and 3rd year. (400000 per year) 2. B2B SaaS companies should spent 8% of their total revenues on marketing. 3. 15000 trips per customer, and avg 3 transactions per trip accounting as per 1.49 Costs (Excluding Initial Capital Investments) YEAR 2023 2024 2025 Project management, customer support ₹ 4,00,000.00 ₹ 8,00,000.00 ₹ 8,00,000.00 Marketing Expenses ₹ 1,00,000.00 ₹ 1,00,000.00 ₹ 1,00,000.00 Other Expenses ₹ 50,000.00 ₹ 50,000.00 ₹ 50,000.00 Depreciation on capital expenditures (calculation uses three-year period) ₹ 70,66,666.67 ₹ 70,66,666.67 ₹ 70,66,666.67 Total Costs ₹ 76,16,666.67 ₹ 80,16,666.67 ₹ 80,16,666.67 Totals YEAR 2023 2024 2025 Net Benefits (Costs) ₹ 1,53,83,333.33 ₹ 1,99,83,333.33 ₹ 2,69,83,333.33 Tax ₹ 46,15,000.00 ₹ 59,95,000.00 ₹ 80,95,000.00 Value after tax ₹ 1,07,68,333.33 ₹ 1,39,88,333.33 ₹ 1,88,88,333.33 Depreciation added back ₹ 70,66,666.67 ₹ 70,66,666.67 ₹ 70,66,666.67 Cash flow ₹ -2,12,00,000.00 ₹ 1,78,35,000.00 ₹ 2,10,55,000.00 ₹ 2,59,55,000.00 Cumulative cash flow ₹ -2,12,00,000.00 ₹ -33,65,000.00 ₹ 1,76,90,000.00 ₹ 4,36,45,000.00 Evaluation Metrics Values Net present value (NPV) ₹ 3,19,14,838.47 Internal rate of return (IRR) 78.32% Payback period (in years) 1.16