“Efficiency Is The New Edge”: BMW Industries Offers Tech-Led Steel Solutions

In an exclusive conversation with Bizz Buzz, Harsh Bansal, MD of BMW Industries, shares how steel service centres are evolving from basic cutters to high-tech, sustainability-driven partners for sectors like auto, infrastructure, and renewables

How have the expectations from steel service centres changed in the last 5–10 years, especially with evolving manufacturing demands?

The steel service centres (SSC) in India have been around for a fairly long time in different avatars. 'Cutters' essentially meant cutting centers were the most basic form, involving only cutting of steel into customer-required sizes. This was often coupled with customers or traders keeping the steel at the centre and ordering and selling Ex-Works as needed. Starting with the advent of the auto industry growth in India, came the need for more quality-related demands, followed by supply chain-related issues, Just In Time deliveries, etc. These developments happened essentially mimicking the Western models for the industry. We, incidentally, were the first to devise the model to align with the manufacturers and not the consumers. India is different, and a design for India needs to be different. Coming to the question, in the last 10 odd years, broadly speaking, the industry has been shifting to Service Centres including more services and facilities.

The Quality and SC-related offerings are a base layer and are taken for granted. Today it's about a basket of offerings and making life further easier for the customer. Eg: Bar bending for long products & Tubes is becoming a part of the offerings, this is fairly new in the industry. Adding logistics to allow for door delivery is another. This allows the customer to deal with a single vendor and makes life easier. On the manufacturing side, safety and statutory compliance have come to the fore. Eliminating man-machine interface, IoT / EBA / SCADA systems to measure and eliminate faults, contractor management, and various other introductions have made us more efficient but also added to the costs.

What are some of the key technologies or automation tools being adopted by progressive steel processing units today?

The focus for manufacturing today is to install top-in-class equipment and to ensure they operate efficiently. This used to be earlier done through low-cost equipment and even if the efficiency was low, often expected, it did not hurt. Not the case today. Customers demand not just good materials but also high-end equipment to ensure minimum variability in processes. As earlier said, the use of IoT devices / EBA and SCADA systems to get to the root of the problems ensures we are able to maintain high uptimes and meet customers' demands.

Eliminating the man-machine interface, ensures the people who work with us, return to their families safely. While Technologies and Automation are good and more and more the norm rather than the exception, the differentiator is the Culture and the people. That often is the difference between running a single facility and managing multiple.

How are service centres contributing to sustainability—whether through material optimization, energy-efficient processes, or waste reduction?

The way to look at a lot of the above is to look at it from the optimization side. The ability of a SSC to combine multiple needs from customers and put them together ensures that the waste is reduced to the minimum possible. The ability to have dedicated teams to manage dedicated processes is another advantage of an SSC. Whenever assets or resources are underutilised, there is a national loss. Let's say a tube maker installs a Slitter, it will operate to the extent of the need for his tube mills, in the sizes they need.

This may not necessarily be the most optimally used asset or the most optimum use of the steel being slit. However, if the same job is outsourced to a service center, it can combine various needs and optimize the process to reduce waste, this route will also ensure that the asset use is optimised. This will not only help reduce the cost but will ensure that the steel wastage is also minimised while the use of energy in the facility is on point. With rooftop solar becoming more affordable, they are becoming more and more popular. Government policy can help here, by allowing net metering. This further strengthened the case of using Solar. At our facilities, we try to ensure rainwater harvesting, Zero Liquid Discharge, rooftop Solar and reuse of resources to minimise the impact on the environment.

In what ways are steel manufacturers and service centres collaborating more closely to support industries like auto, infrastructure, or renewable energy?

While the Steel manufacturers have a much broader field of vision, the SSCs are able to innovate on the ground. Deeper collaborations between the two ensure that while the steel companies make the required steel in the specs needed by the customers, the SSCs are able to process it to the closest usable form. Oftentimes acting as an intermediary with the ability to keep stock, bundle the deliveries, and ensure timely availability.

The effective use of an SSC ensures that there are no minimum jobs to be undertaken on site of use, eg, bar bending in the case of infrastructure projects. While the Steel companies move to develop higher-strength steels, in various dimensions, the SSCs need to be able to create the capabilities to process the same.

What challenges do traditional steel players face in adopting these innovations, and how can the ecosystem (government, tech partners) support this shift?

Traditional SSCs essentially face a challenge of mindset. We have been fortunate to have customers who have allowed and often pushed us to move with the times. Even though at the time, it seemed like a burden, in hindsight, it has been a blessing. From automation to Safety to Environment, it has been a journey of efficient optimisation. I guess the biggest influencer in the Indian ecosystem is the Government.

By creating policies that allow us to reduce the cost of doing business, they can give this sector a fillip. Input Tax credit on capital goods is a major issue since the same blocks cash flows for many many years. In a high interest rate environment, it is a huge drag on overall costs. Can the industry be allowed to transfer their input tax credit? Revenue neutral for the government, and yet a huge benefit for the industry.