Tata Steel wants to engage in more buying from local vendors than it has so far been doing to meet its needs of spares and several other items which it currently procures from elsewhere.
“I have been told that SMEs here are not being encouraged by Tata Steel the way they should have been; we have therefore decided that if they (such local units) had the right product and service and adhered to total quality principles we would work with them,” Tata Steel managing director HM Nerurkar said while addressing members of the Singhbhum Chamber of Commerce & Industry.
Tata Motors’ medium & heavy commercial vehicles unit is supported by around 1,000-odd ancillary units located in and around the industrial area of Adityapur here. Until June 2011, these units were meeting 40% of the auto major’s local aggregates and spares’ needs and are now said to be meeting 60-65% of the requirements.
Nerurkar said, “I have asked our new procurement chief Amitava Bakshi to form a special task force in the form of a new vendor development cell whose activity would be reviewed every six months.” He added that such reviews would check whether the turnover of local vendors was going up satisfactorily or not.
Welcoming Tata Steel’s move to support local vendors by way of procuring spares and other items, RK Sinha, president, Adityapur Small Industries Association (ASIA), said the 1,000-odd medium and small ancillary units would be benefited if all local Tata Group units, like Tata Rolls, ISWP, TRL Krosaki Refractories, Tata Pigments and TRF, drew up their future requirements and conveyed the same in advance to ASIA.
“We would not compromise on quality. We (local manufacturers) just want to be given priority over others,” said Sinha.
Nerurkar said for the time being Tata Steel had plans to procure items locally for its plant and its Tata Growth Shop here as also for its iron ore and coal mines while procuring items for Kalinganagar could come up only in the future.
“Let’s start working together,” said Nerurkar, adding that it was not easy to meet the needs of the customer from ‘day one’ as had been Tata Steel’s experience with Toyota when it had first started supplying steel to the Japanese car manufacturer.