High input costs owing to surging commodity prices pose an escalating challenge to global steelmakers including us. The broad market scenario is also fraught with downside risks owing to an unexpected health crisis. Operating in such an external environment, our consistent focus is on elevating the efficiency curve in order to protect and strengthen our margins. We are containing our overheads and managing resource allocation effectively.
In FY 2020-21, we focused on optimising our fuel consumption at blast furnaces, reducing coke moisture, utilisation of pipe conveyor system for the transport of iron ore from mines to reduce supply chain costs. We have also undertaken strategic initiatives to improve efficiency and cut costs in the long run.
In order to decrease the facility’s requirement of expensive lump iron ore, we have set up an 8 MTPA pellet plant at Vijayanagar and the project has been commissioned and is under trial run. The construction of Coke Oven Battery of 1.5 MTPA is under process and will be commissioned in phases from Q3 FY 2021-22. We have also decided to further enhance the capacity by 1.5 MTPA coke oven plant at Vijayanagar and we expect the same to be commissioned by second half of FY 2022-23. Cumulatively, the projects will contribute towards substantial cost savings.
We are setting up a second line of 1.5 MTPA coke oven plant along with Coke Dry Quencher (CDQ) facilities to cater to the additional coke requirement for the crude steel capacity expansion to 10 MTPA at Dolvi. One of the 2 batteries (0.75 MTPA each) is fully in operation. Similarly, the second battery’s start-up is under progress and the unit is expected to be operational during Q2 FY 2021-22. One out of three CDQ units will be operational before Q1 FY 2021-22. However, balance two CDQs are expected to be commissioned during Q2 FY 2021-22.
The Company is setting up 175 MW Waste Heat Recovery Boilers (WHRB) and a 60 MW captive power plant to harness flue gases and steam from CDQ. These power plants are expected to be commissioned during Q1 FY 2021-22.
Our digital strategy focuses on bolstering sales, enhancing throughput, reducing defects, increasing availability of assets and improving safety. It also encompasses our adoption of Industry 4.0 technologies, including Artificial Intelligence (AI), Machine Learning (ML), computer vision, Internet of Things (IoT), robotics and big data analytics, among others. These technologies have been deployed across our integrated steel plants, specialised downstream plants and centralised functions.
Our digital strategy aims to address four key themes critical to and aligned with overall stakeholder value maximisation.
We have steadily introduced process improvements by fast-tracking digitalisation. FY 2020-21 was marked as the year of ‘Digital Acknowledgement’ in JSW Steel, wherein we extended our digitalisation drive across new frontiers, while consolidating and seeing consistent impact through earlier deployed initiatives. Across all our integrated plants, sales and marketing and other support functions, our employees participated in the journey with vigour and enthusiasm.
Over 6,000 employees directly engaged in our cultural transformation journey, 200+ digital ideas got generated in-house by plants and functional teams, and some of the world’s best and most cost-effective cutting-edge technology solutions such as Artificial Intelligence/Machine Learning, Fog Computing, Deep Learning, IoT, Computer Vision, Robotics are being deployed.
Digitalisation has made way for greater efficiencies and delivery of superior business value. As early adopters, our digitalisation journey goes back to 2017 and has since been the basis of efficiency enhancements, cultural transformation and seamless system-people interaction. We are seeing visible results in term of profitability, and have consistently pushed the boundaries of our sustainability agenda.
Our key objective has been to ensure granularity and consistency in adopting ways of working and keeping in with changing times, without incurring significant capital expenditure. We anticipate our digital efforts to bring in positive returns within one year of deployment. For FY 2020-21, our digital investments stood at ₹ 89 crore, and we are determined to multiply investments significantly, going forward. Our digital efforts are led by a Chief Digital Officer and Chief Information Officer
In the digital universe, we have 13 priority areas that we are pursuing with diligence:
We conducted phased rollout of digitalisation interventions, with the third wave currently underway. Concentration has been on workforce upskilling and equipping them with necessary tools to adopt and sustain the lighthouse initiatives we have operationalised. We achieved ₹ 427 crore of savings in FY 2020-21, cumulatively accounting to ~₹ 1,100 crore so far. Our future plans entail working towards achieving another ₹ 800 crore in savings and upskill for 2000+ employees.
Data is at the centre of all our functions and it is has been crucial in the optimisations of our digital journey. Today, data collection and management are a deeply ingrained part of our systems and our workforce is empowered to use data effectively for accelerated decision-making.
We work to make the most of Big Data analytics to determine the ideal superheat temperature at which the heats from ladle furnace should be transferred to caster, enabling acceleration in the casting process and diversion of more of our liquid steel production towards making HRC. This is because it has a higher margin than that of long products, thus enabling us to gain higher realisation.
Predictive and rule-based AI systems across multiple shops have given us the power to automate decisionmaking across process parameters and remove operator discretion and errors in estimation.
For example, we leveraged AI to reduce the set-up time in our Steel Melting Shop (SMS). Variations in the set up time was proving to be the biggest factor contributing to and governing the overall throughput of the shop. To resolve this, we installed cameras across multiple points to ensure activities are captured adequately for inferences. With sufficient video data at our disposal, we ran a time motion study to estimate the ideal time for each activity and identify opportunities for task parallelisation.
Following the analysis, we ran a workshop to educate and train shop floor employees on working more efficiently. Following the workshop, we built imag eand movement-based machine learning algorithms, which analyse the process in real time, records the results and reports deviations from the ‘ideal time’ to the shift in-charges and line managers.
Setting up our now fully functional Digital Centre of Excellence, led by relevant experts in Industry 4.0 technologies has been a winning move. Our team brings together functional experts with deep knowledge of operations and support functions, helping us successfully drive a focused transformation agenda. At every manufacturing location, a digital champion (among the senior leaders in the plant) is responsible for carrying out effective digitalisation efforts.
So far, 200+ digital use cases were implemented and 4,000+ people were covered under it. We are easing the shift among people through a thoughtful mix of gamification initiatives, appreciation and awards for pioneers and adopters, and creating technical cells.
Going forward, we plan to bring onboard 30 people as full-time DCoE members, 300+ Digital Stewards and Enablers, contributing to the ongoing transformation. We also plan to upskill 80+ existing employees on analytics and data scientist skills.
Puneet Pahwa, Digital Node, Vijayanagar
Gautam Khera, Digital Steward, Dolvi
Project SAMPARK is designed to optimise logistics cost by leveraging technology and in process improve resource utilisation, accommodate supply/demand variations without impacting delivery and best in class OTIF (On-time-in-full) through real-time co-ordination between functions and efficient planning.
SAMPARK is envisaged to deliver the desired results for the business by combining processes, integrating with IT and Operational Technology (OT) systems, creating new digital interventions to capture last mile data, manless weighbridge automation and giving a powerful App to all stakeholders.
Overall vision and key issues and complexities that plague the logistics set up
End to end interventions across incoming as well as outbound logistics (across rail, road, sea) – aiming towards a smart logistics system
Required tech landscape to enable the interventions and set up a smart logistics system
Key KPIs to monitor through the Logistics Control Tower
