TISCO: The World's Most Cost Effective Steel Plant

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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Case Details:


Case Code : OPER011 For delivery in electronic format: Rs. 300;
For delivery through courier (within India): Rs. 300 +Shipping & Handling Charges extra


Operational Restructuring
Case Length : 12 Pages
Period : 1980 - 2002
Organization : TISCO
Pub Date : 2002
Teaching Note : Available
Countries : India
Industry : Steel


The case talks about the operational changes at TISCO that enabled the company to become the lowest cost producer of steel in the world. TISCO initiated a five-phase modernization program in the early 1980s, to overcome problems in the steel-making process. The program's primary objectives were to enhance the operational processes and reduce costs. The operations' aspect was addressed in the Phase III of the program with the help of consultants McKinsey and Booz Allen-Hamilton. McKinsey designed a program called Total Operational Performance (TOP). TOP's main objective was to impact the bottomline with minimum expenditure and minimum time. TOP enabled TISCO to improve its performance.

Operations Management Case Studies | Case Study in Management, Operations, Strategies, Marketing Management, Case Studies

TISCO also achieved cost reduction through other strategies like manpower reduction, organizational restructuring, and using information technology to enhance certain business processes. With the completion of the modernization program, TISCO was able to record profits despite the low global demand for steel and cheap imports.


The factors that enabled TISCO to become the world's lowest cost steel producer


  Page No.
Background Note 1
The 'Top' Program 2
Implementing Best Practices 4
The Future 4
Exhibits 6


Operational changes, TISCO, lowest cost producer, steel, five-phase, modernization, program, 1980, steel-making process, primary objectives, operational processes, reduce costs, Phase III, consultants, McKinsey, Booz Allen-Hamilton, McKinsey, Total Operational Performance, TOP, cost reduction, manpower reduction, organizational restructuring, information technology, business processes, modernization program

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