Case Study: Value Chain Analysis of BSRM Group, Bangladesh

Topics: Steel, Marketing, Customer relationship management Pages: 10 (2741 words) Published: March 9, 2013
Today’s aggressively competitive business environment has led to companies recognizing more and more the imperative of strategically positioning themselves in order to remain competitive.  The propagation of goods and services, continually improving modes of operation, quality standards, innovation, information etc, have spawned commoditization and replication of offerings, and with them, unremitting competition, hence the imperative of differentiation.  Applying the principles of the value chain (ie. adding value within each and at the interface between business processes to create value for the end consumer) can assist companies in achieving this. A winning company always works for improving and adding values to its business in Zero Time. To attain its business activities, the companies perform the primary activities supported by the supporting units. In this assignment paper we will try to see how BSRM adds values in their supporting activities. We will follow the Value Chain Model. Value Chain Analysis

Value chain analysis is a powerful tool for managers to identify the key activities within the firm which form the value chain for that organization and have the potential of a sustainable competitive advantage for a company. The "primary activities” include: inbound logistics, operations (production), outbound logistics, marketing and sales (demand), and services (maintenance). The "support activities" include: infrastructure management, human resource management, technology (R&D), and procurement. The costs and value drivers are identified for each value activity.

Selected Company and Product
BSRM Group is the largest and leading industrial conglomerate in the steel sector of Bangladesh. The BSRM Group of Companies has been in the steel business from 1950 with a set of four manual rolling mills produced reinforcing bars and structural sections. The mill gradually expanded, adopting new technology by setting up a cross country European mill in 1987 which included a wire-rod mill. In 1996 the group added a captive billet making plant to ensure a steady supply of quality billets for its rolling mills. A pilot cold rolling mill to manufacture ribbed high strength wires was installed in 2006. Finally in 2008 a state-of-the-art DANIELI built rolling mill. Product

* “Xtreme 500W”
* Deformed Bar
* MS Angles
* MS Channels
* Spring Steel Flats
* Shaft
* I. Beam
* H.Beam
As they have many products but we considered to undergo the value chain analysis with only BSRM xtreme bars.

Unique features of BSRM Xtreme Bars:
1. High design yield strength of 500 Mpa (72500psi) (Min)
2. Requires 15% less steel in construction compared to Grade 60 rebar available in the market. 3. The bars have superior bend ability and can be safely bent without cracking. 4. All bar sizes are rolled to a very close tolerance (possible on a DANIELI computerized rolling mill) so that customers get more meters of steel per ton - more value for money without having to sacrifice structural integrity. Estimated savings: 0.5%. 5. De-scaled bars have better bonding with concrete and less wastage at site. Estimated savings: 0.5% 6. Xtreme bars are safely weldable under field conditions. Another 0.5% to 1.5% of steel is saved by avoiding large splices. 7. The bars are needle-straight, thanks to the Danieli QTB process - no need for straightening on the construction site.

Primary Activities
Inbound Logistic: Inbound logistics involves the receipt of inputs such as raw materials or inventory, storage in preparation for production, and distribution to production area(s) as necessary. The ease of facilitating the availability of inputs to feed manufacturing processes is crucial to subsequent processes. A company can set itself apart by ensuring exceptional coordination of supplier relationships, transportation services and inventory management and so on. Enhancing the sub-activities within this...
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