The JSW Challenge
Suggest an approach to provide a solution to meet JSW’s growing
procurement needs
The Facts
• JSW is a $11 billion company and is headquartered in Mumbai, India
• JSW has diversified interests in Steel, E...
Background on Challenge
• JSW effectively uses a homegrown customer network, involving online auction,
for sales of its se...
The Problem
• JSW has institutionalized a Central Procurement process for high value
procurements and the other procuremen...
The Challenge Statement
JSW is looking for a “Lite” solution — One that could enable them
to start with a small network an...
The Challenge Statement - Details
• Multiple solutions are available to enable supplier network in areas of
capital purcha...
Important Points to Remember
• Building a supplier network is a time-consuming process
• Networks available in the market ...
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Capgemini Super Techies Show Season 2: The JSW Challenge presentation

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Capgemini Super Techies Show Season 2: The JSW Challenge presentation

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Capgemini Super Techies Show Season 2: The JSW Challenge presentation

  1. 1. The JSW Challenge Suggest an approach to provide a solution to meet JSW’s growing procurement needs
  2. 2. The Facts • JSW is a $11 billion company and is headquartered in Mumbai, India • JSW has diversified interests in Steel, Energy, Cement, Ports, Mining and Information Technology • JSW Steel is India’s leading producer of steel with a capacity of 14 million tons per annum (MTPA) and is typically known for its quality • World Steel Dynamics has repeatedly ranked JSW as the lowest-cost producer of steel in the world
  3. 3. Background on Challenge • JSW effectively uses a homegrown customer network, involving online auction, for sales of its secondary steel products. This has been a successful program for over a decade. • In view of the success of this program, JSW proposes to create a similar system and network of suppliers to address the procurement process • Many large enterprises have opted for supplier networks created by leading players in the market
  4. 4. The Problem • JSW has institutionalized a Central Procurement process for high value procurements and the other procurements happen in a localized manner. • JSW gets to deal with only a set of approved vendors all the time – thus, there is no option of price discovery or information on vendors not used in the past • This process involves manual steps, which need to be minimized • Individual business units may tend to work too independently leading to governance issues and lack of optimality. • JSW is looking for a volume and scale advantage
  5. 5. The Challenge Statement JSW is looking for a “Lite” solution — One that could enable them to start with a small network and then keep growing it The network should be completely homegrown — no software licenses required and managed completely internally • In this scenario, is it better to use a third-party supplier networks or develop JSW’s own system and grow the network progressively? • What is the right way forward – Buy or Build?
  6. 6. The Challenge Statement - Details • Multiple solutions are available to enable supplier network in areas of capital purchase, direct materials, MRO, services, etc. • Multiple IT-enabling processes, such as sourcing, negotiations, procurement, POs, invoicing, payment, etc., are available in the industry. Do you suggest a phased approach or a big bang approach for processes and relevant solutions? • Should the proposed solution be integrated to existing systems at JSW or be standalone? Should it be a hosted solution or be maintained behind the JSW firewall? Should it be a build or a buy scenario? • Will it be a pure IT solution or come bundled with other services? • The challenge has to be looked at from the point of view of usefulness, practicality, scalability, relevance to JSW, cost, etc., and a roadmap/business case (qualitative) has to be presented to the panel • The cost and time perspective is of utmost importance to this challenge
  7. 7. Important Points to Remember • Building a supplier network is a time-consuming process • Networks available in the market already have a million suppliers but are expensive • If it is JSW’s own network, there is the additional advantage of reasonable confidentiality of transactions, especially on pricing and spend • A JSW owned network will not incur additional costs when adding more suppliers or users.

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