Productions and Operations Management

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  • Topic: Steel, Rail gauge, Iron ore
  • Pages : 4 (1218 words )
  • Download(s) : 108
  • Published : April 17, 2011
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* CASE STUDY
* PLANT LOCATION PROBLEMS
* During 1970 government of india decided to expand the steel production under public sector units (psu). Three locations were selected to set up the plant. 1. Vijayanagar steel plant in bellary Karnataka.

2. Salam steel plant in TN.
3. Vizag steel plant in AP.
* A panel of eminent personalities was formed to analyze the locations. * The important raw materials for steel are :
1. Iron ore : should contain atleast 60% of iron and <30% of ash content. 2. Coal
VIZAG (1ST Prefered) | SALEM (2nd prefered) | VIJAYNAGAR (least prefered) | Iron ore rich in 65% of iron| Iron ore has 60 – 65% of iron.| Iron ore has 60% of iron.| Coal can be brought from AP and also MP and Bihar.| Coal available in lignite form(low quality), should be converted into coke for use.| Coal has to come from AP.| Well connected with broad gauge railway lines to all important cities.| Has broad gauge lines to all cities.| Only meter gauge railway lines which are not connected to important cities| Has sea port and airport.| Has madras sea port. | Sea port and airport is far away from the place.|

* As per the experts guidance , steel plants were set up in vizag and salem. * But then PM Smt. Indira Gandhi layed the foundation stone in 1971 at vijayanagar ,though she knew that the place was not suitable to set a steel plant. This was ultimately done to please the people and impress them because it was election time. But the work never started there. This was just done to fool the voters by the way of just laying the foundation stone. * Both Vizag and SalemSteel plants were quite huge with township having about 50,000 to 1lakh people. * Hence requirements of housing electricity,water,hospitals,education,entertainment facilities were very essential.This lead to the development of the surrounding areas of the plant. * Both Vizag and Salem got these...
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