3c Report

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AN INITIAL REPORT ON

SUBMITTED TO: MRS. SUMAN VIJ FACULTY GUIDE

SUBMITTED BY: RICHA RAI 7NBDH025

PRESENTING 3C REPORT ON

2

INC 7NBDH025

11/07/09

WHAT IS 3C?............... AN INTRODUCTION

THE 3C REPRESENTS……. CUSTOMERS



IT COVER THE ECONOMIC VALUE TO THE CUSTOMER, IT NOT ONLY INCLUDES THE INDIVIDUAL CUSTOMER BUT IT ALSO INCLUDES THE MARKET IT IS CONCENTRATING ON AND THE PRODUCTS IN WHICH THEY DEAL. COMPANY ITSELF



COMPANY INCLUDES BOTH THE ECONOMICS AND FIT WHERE IN ECONOMICS IT INCLUDES COST, PROFITABILITY, EXPERIENCE CURVE, CAPACITY AND IN FIT IT INCLUDES STRATEGY AND VISION, STRENGTH AND WEAKNESS, ITS CULTURE AND ITS STRUCTURE COMPETITORS



IT COVERS THE DIFFERENT FORCES WHICH BEING HELPFUL TO ANALYSE THE INDUSTRIAL ENVIRONMENT LIKE MARKET SHARE OF THE COMPETITORS, CORPORATE GOALS, ECONOMIES OF SCALE AND SCOPE BOTH AND RELATIVE PRODUCT POSITIONING

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INC 7NBDH025 11/07/09

ABOUT NATIONAL OILWELL VARCO (nov) ……. 

NOV IS US BASED COMPANY WHICH DEALS IN MANUFACTURING OIL DRILLING EQUIPMENT.



NOV OPERATES IN OVER 20 COUNTRIES WORLDWIDE THROUGH ITS WHOLLY OWNED SUSDIARIES AND JOINT VENTURES. NOV CONTINUES TO GROW AND EXPAND LARGELY THROUGH ACQUISITIONS, MERGERS AND FORMATION OF JOINT VENTURES.



RECENTLY THE COMPANY HAS ANNOUNCES THAT IT HAS AQUIRED GREAT PRIDECO INC, A DRILLING PRODUCT MAKER FOR USD 7 BILLION.



NOW ITS ACHIEVEMENTS LET IT TO REACH AT THE FOURTH LARGEST OIL DRILLING SERVICES IN THE WORLD.

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INC 7NBDH025 11/07/09

ABOUT NOV SARA…………… 

NOV Sara is a joint venture which is 76% owned by NOW(Asia), a wholly owned subsidiary of NOV.



The remaining 24% of NOV Sara is owned by local management.



The NOV Sara joint venture was formed July 31, 2007



Prior to this, the company operated under SARA SAE PRIVATE LTD



NOV Sara manufactures and sells oilfield related equipment and parts to customer located in India and abroad , largely to US customers , both third party and related companies. 5

INC 7NBDH025 11/07/09

JOURNEY ALL THE WAY………………………… 

1978 : ESTABLISHED AS SARA SERVICES AND ENGINEERS PRIVATE LTD WITH NET CAPITAL OF RS.25000



1981-84: ENTERED INTO FOLLOWING TECHNICAL COLLABORATIONS AGREEMENTS FOR MANUFACTURING IN INDIA WITH



KOOMY



ECKEL



VARCO BJ



CAMCO



1982: PLANT SET UP AT PRESENT LOCATIONS OF DIV II



1990: ESTABLISHED VARCO SARA AS A 60:40 JOIN VENTURE WITH VARCO BJ FOR MANUFACTURING OF HANDLING TOOLS IN INDIA.



2002: ESTABLISHED STS HOUSTON FOR DISTRIBUTION IN US



2007: MERGED INTO NATIONAL OILWELL VARCO.

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INC 7NBDH025 11/07/09

CUSTOMER……………………………… NOV SARA CATEGORIES ITS CUSTOMER ACCORDING TO THE THREE DIFFERENT SEGMENTS INDIGENOUS CUSTOMER

EXPORT RELATED

EXPORT UNRELATED

JOHN ENERGY

STS PRODUCTS LTD

3C METAL INT

OIL INDIA LTD

NOV JUBEL ALI

DRILLTOOLS EQUIPMENT

ONGC

SEAHARVEST FREE ZONE

A&P INTERNATIONAL,PERU

ABAN LOYD CHILES

ATOM SUPPLY, AUSTRALIA

V-LINE HYDROLIC

FIRST HOSE

POWERFLEX

R B PIPETECH

ESSAR OILFIELD

VALVE WORKS, USA

NIKO RESOURCES

ENRON OIL AND GAS

VARCO SARA

DOSCO, NETHERLANDS

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INC 7NBDH025 11/07/09

COMPETITORS…………………… WHEN WE TALK ABOUT THE NOV SARA IT HAS ITS DOMINATING POSITION IN INDIAN MARKET FOR THE FOLLOWING MAIN PRODUCTS: 

BLOW OUT PROJECTORS(BOP)



HYDRAULIC POWER TONGS IT HAS SOME COMPETITORS IN MANUFACTURING HAMMER UNIONS AND RING JOINT GASKET M/S PRAVEEN LTD



WORLD WIDE COMPETITORS FOR NOV ONLY 

SCHLUMBERGER



BAKER HUGES



HALLIBURTON WORLD WIDE COMPETITORS FOR NOV SARA



8

LOW COST PRODUCER ALL OVER THE WORLD.

INC 7NBDH025 11/07/09

WHO’S WHO?................................ NAME

DESIGNATION

MR. PETE MILLER

CHAIRMAN PRESIDENT AND CEO OF NOV

MR. V.K. DHAWAN

MANAGING DIRECTOR AND CHAIRMAN

MR. P. K. DHAWAN

VP OPERATIONS AND RESPONSIBLE FOR UNIT I

MR. SUMIT DHAWAN

VP FINANCE AND RESPONSIBLE FOR UNIT II

MR. SAMIR DHAWAN

VP PRODUCTION

MR. DENNIS CHIN

CFO, REPRESENTING NOV

MR. SENGUPTA

CFO , STARTING APRIL 15 , 08

MR. VIKRAM KAPOOR

SENIOR MANAGER OF FINANCE & ACCOUNTS, CSA

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INC 7NBDH025 11/07/09

MARKETING OVERVIEW

PRODUCT OVERVIEW…………… 

BOP ACCUMULATOR UNITS VETCO (ABB) , USA TYPE 80 LINE AP 16D ACCREDITATION



HYDRAULIC TONGS , ECKEL, USA LINE , API 7K ACCREDITATIONS



FLANGES , SPOOLS AND RING JOINTS GASKET, API 6A ACCREDITATION



HAMMER UNION , VARCO BEST LINE , WECO INTERCHANGEABLE



SWIVEL JOINTS VARCO BEST LINE , API 16C ACCREDITATION

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INC 7NBDH025 11/07/09

FACILITIES AND LOCATIONS DISTRIBUTION

SERVICES

HOUSTON , TEXAS, USA

MUMBAI

EDMONTON , CANADA

INDONESIA

BOGOTA, COLUMBIA

DUBAI

BERGEN, NORWAY

KUWAIT

MUMBAI , INDIA

OMAN

SINGAPORE

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INC 7NBDH025 11/07/09

FINANCE OVERVIEW

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INC 7NBDH025

11/07/09

FINANCE……………………………..

PROJECTING THE TARGET OF SALES WITH THE PAST RESULTS

SALES

US $ MM

2006-07

23.50

2007-08 FORECAST

31.90

2008-09 BUDGET

81.50

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INC 7NBDH025 11/07/09

HUMAN RESOURCE MANAGEMENT OVERVIEW

15

INC 7NBDH025

11/07/09

MANPOWER EMPLOYED…………. TOTAL STRENGTH

800

ENGINEERS

140

SKILLED WORKERS

400

SERVICE PERSONNEL

20

REST WORKERS

240

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INC 7NBDH025 11/07/09

SWOT ANALYSIS A BRIEF REPORT ON STRENGTH, WEAKNESSES OPPORTUNITY AND THREATS OF

STRENGTHS…………………………. WHAT LET THE NOV SARA TO MAKE ITS OWN STANDING



TECHNICAL KNOW HOW



COST EFFECTIVENESS APPROACH TO PRODUCE COMPONENTS REQUIRED THROUGH IMPORT.



DOMINANT POSITIONING IN MANUFACTURING BOP ACCUMULATOR AND HYDRAULIC POWER TONGS.



SEPARATE UNIT FOR EXECUTION OF PRODUCTION FOR EACH DOMINANT PRODUCT.



SUPPORT OF TECHNICAL COMPANIES LIKE: KOOMEY ECKEL AND LASTLY THE MAJOR ONE NOV WHICH ACTS AS BACKBONE FOR RESTRUCTURED SARA ENGINEERING AND SERVICES.

  

o

SOUND CUSTOMER DATABASE

o

LOW COST OF PRODUCTION 18

INC 7NBDH025 11/07/09

WEAKNESSES…………………………. MAJOR LOOPHOLES………………………. BESIDE HAVING A LOT OF ADVANTAGES AND STRENGTH, NOV SARA HAS ALSO SOME NOTICEABLE WEAKNESSES, WHICH CAN AFFECT ITS WORKING AND FUNCTIONS 

SWITCHING OVER OF EXPERIENCED EMPLOYEES DUE TO CHANGES IN INDIAN MARKET.



SHORTAGE OF SPACE FOR INBOUND LOGISTIC SYSTEM.



SHORTAGE OF TECHNICAL ENGINEERS WHICH IS CAUSED BY GROWTH OF NOV SARA WHICH BEING A NEED TO ENJOY THE COMPETITIVE ADVANTAGES.



THERE IS NO UPDATED SYSTEM FOR QUANTITY CONTROL MANAGEMENT

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INC 7NBDH025 11/07/09

OPPORTUNITIES…………………….. LOOK FORWARD TO WIDEN THE SCOPE AND CAPTURE THE MARKET 

FRANCHISE AGREEMENT WITH DRILLTOOLS IN DUBAI.



FUTURE PLANS TO CREATE OWNED STOCKS IN DUBAI TO CATER TO ALL REQUIREMENT ORIGINATING IN MIDDLE EAST AND NORTH AFRICA.



PLANS TO ENTER INTO PRICE AGREEMENT WITH NDC USING FARIS INTERNATIONAL AS AGENT.



RECTIFICATION OF ACCUMULATOR UNITS TO BE PROMOTED WITH KOC AND JOINT OPERATIONS.



NEW AGREEMENT TO BE ENTERED WITH AET.



14 STATIONS UPGRADE OFFER SIGNIFICANT POTENTIALS.

20

INC 7NBDH025 11/07/09

THREATS…………………………. FACING CHALLENGES REGARDING SOME ASPECTS 

INTERNATIONAL MARKET



PRICING STRATEGY OF THE COMPETITORS



SWITCHING OVER OF THOSE EMPLOYEES TO WHOM THE COMPANY HAS A VERY LONG TERM RELATIONSHIP. SO THE MAIN THREAT IS TO HOLD THE MAN POWER.



POLITICAL ENVIRONMENT



MAINTAINING THE STANDARDS AND NORMS OF NOV.

21

INC 7NBDH025 11/07/09

BUSINESS OBJECTIVES PREPARATION OF ALL SUPPORTING DOCUMENTS OF THE FOLLOWING: 

TRANSFER PRICING



PRODUCT AND PRICE VARIATIONS



INVENTORY COSTING



JOB COSTING



INVENTORY OBSOLECENCE ALL THROUGH COST ALLOCATION METHOD

22

INC 7NBDH025 11/07/09

WEEKLY EXPECTATIONS 

TO GAIN AN UNDESTANDING OF NOV, BUSINESSES OF NOV SARA, PRODUCTS MANUFACTURED, TRANSFER PRICING AND ISSSUES UNDERSTANDING.



BEGIN ANALYSIS OF COST OF GOODS SOLD AND GROSS MARGIN FOR UNIT II



COMPLETE ANALYSIS OF COST OF GOODS SOLD AND GROSS MARGIN OF UNIT II



ANALYSE PREPARE COMPLETE COST ALLOCATION SCHEDULE FOR ONE EXPENSE ACCOUNTS



GAIN AND UNDERSTANDING OF UNIT II PURCHASING CYCLE AND DOCUMENT THE PROCESS



REVIEW THE DOCUMENTATION.

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INC 7NBDH025 11/07/09

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INC 7NBDH025 11/07/09

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