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
3
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.
4
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.
6
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
7
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
9
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
11
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
12
INC 7NBDH025 11/07/09
FINANCE OVERVIEW
13
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
14
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
16
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
19
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.
23
INC 7NBDH025 11/07/09
24
INC 7NBDH025 11/07/09