Using product segmentation to improve supply chain management in Tata Steel

The steel making operations of Tata Steel in Europe are moving to a new operating model with common processes adopted at all sites. Two of the major initiatives underlying this new model are Customer First and Supply Chain Transformation. Collectively, these initiatives aim at making a step change in the company’s offering to customers with a focus on improving delivery on time, reducing leadtime and reducing work in progress. Improving the flow of material through the business is critical in achieving these objectives. The ORteam has been involved in standardising a common process for product segmentation. The team has taken a data-driven approach and this article outlines the methods used in creating the output necessary to ensure supply chain improvements. OR Insight (2012) 25, 150–164. doi:10.1057/ori.2012.6; published online 18 July 2012