Various factors for Organizational Effectiveness of SAIL

1. Submitted by
Neelutpal Saha

2. • Steel Authority of India Limited (SAIL) is the leading steel-
making company in India. It is a fully integrated iron and steel
maker, producing both basic and special steels for different types
of industries and for sale in export markets.
• SAIL is ranked amongst the top ten public sector companies in
India in terms of turnover.
• SAIL produces iron and steel at five integrated plants and three
special steel plants, located principally in the eastern and central
regions of India and situated close to domestic sources of raw
materials. The company has the distinction of being India’s largest
producer of iron ore and of having the country’s second largest
mines network.

3. SAIL’s Inputs:
•Raw Material- Iron-Ore
•Manpower
•World Class Technology
SAIL’s Value Addition
process:
•Integrated production of Steel
from Iron-ore
•Competence Build-up
SAIL’s Environment:
•Liberalization of Steel
Industry
•Human Resources
Management System
•Expansion and
Modernization of SAIL
SAIL’s Outputs:
•Stainless steel and other alloy
steels
•Competent manpower and
Managerial workforce rich in
experience

4. Effect of Liberalization-
Iron and Steel Industry being removed from the list of industries reserved
for the public sector , many new players like Tata entered the market making
competition tougher.
Foreign equity investment was increased to 74%
Prices being deregulated, market was free to decide own price
Freight disadvantage to states located near steel plants due to removal of
Freight Equalization Scheme
Human Resource Management System-
A state of the art HR management system which included “Human
Resources Planning Model for Modernization”, “Performance Management
System”, ‘Market Orientation through Internal Customer Satisfaction’ etc.
Expansion and Modernization-
Enhancing production capacity and Market Share
World Class Technology and Products
Addition of value added products
Enhanced pollution control measures and environmental conservation

5. Chairman
& CEO
Finance
HR
Technical
Raw Material
Research
Commercial
Plant
Management
Functional
Managers

6.  There are 6 group functions within SAIL each of which is being
headed by a Director and the Chairman of the board of Directors is
the CEO as well
 All the functions consist of sub-functions which are each headed by
an Additional Director who report to the Director of that specific
function
 All the operations in a plant are being handled by the Managing
Director of that plant who have full operational freedom and report to
the CEO directly
 There are various functions within the plant each of which is looked
after by a General Manager and he directly reports to the plant MD.
But some functions like HR, Finance, etc are related to the group
functions of the organization and thus have a functional reporting to
the Director of those functions as well.
 SAIL also have their own Central Marketing Organization (CMO) a
services unit who look after the marketing, sales and distribution.
 Overall the organizational structure which consist of both functional
and multi-divisional approach is very appropriate for a
manufacturing firm of such scale.