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    How AI Helps Tata Steel Save $2 Billion in EBIDTA - The Hi

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    Tata Steel uses artificial intelligence and data across its production processes to improve efficiency and reduce costs. Some key ways AI is used include optimizing raw material procurement and chemical mixtures in blast furnaces, identifying defects in products using image recognition, and consolidating control rooms. These applications have helped Tata Steel achieve $1.4 billion in cost savings so far from a target of $2 billion. Data, cloud computing, and AI algorithms are integrated throughout the company's operations.

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    How AI Helps Tata Steel Save $2 Billion in EBIDTA - The Hi

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    38 views9 pages
    Tata Steel uses artificial intelligence and data across its production processes to improve efficiency and reduce costs. Some key ways AI is used include optimizing raw material procurement and chemical mixtures in blast furnaces, identifying defects in products using image recognition, and consolidating control rooms. These applications have helped Tata Steel achieve $1.4 billion in cost savings so far from a target of $2 billion. Data, cloud computing, and AI algorithms are integrated throughout the company's operations.

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    Tata Steel uses artificial intelligence and data across its production processes to improve efficiency and reduce costs. Some key ways AI is used include optimizing raw material procurement and chemical mixtures in blast furnaces, identifying defects in products using image recognition, and consolidating control rooms. These applications have helped Tata Steel achieve $1.4 billion in cost savings so far from a target of $2 billion. Data, cloud computing, and AI algorithms are integrated throughout the company's operations.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    38 views9 pages

    How AI Helps Tata Steel Save $2 Billion in EBIDTA - The Hi

    Uploaded by

    saranshpolymers
    Tata Steel uses artificial intelligence and data across its production processes to improve efficiency and reduce costs. Some key ways AI is used include optimizing raw material procurement and chemical mixtures in blast furnaces, identifying defects in products using image recognition, and consolidating control rooms. These applications have helped Tata Steel achieve $1.4 billion in cost savings so far from a target of $2 billion. Data, cloud computing, and AI algorithms are integrated throughout the company's operations.

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    Home » Science and Technology

    Spark of genius . How AI helps


    Tata Steel save $2 billion in
    EBIDTA
    Updated - October 01, 2023 at 02:59 PM.

    The steel major employs data across its production line, HR, logistics,
    decision making, to deliver quality and reduce costs

    BY M RAMESH

    COMMENTS SHARE READ LATER

    Key ingredient: Data and AI have become as important as iron ore and coke for the steel
    :
    industry

    Guess what the crucial raw materials for


    running a profitable steel company are? Iron
    ore, coke, a lot of energy and data.

    Tata Steel, for one, will never face any


    shortage or cost spike of the last. And, with
    artificial intelligence (AI), the company is
    squeezing data to extract profits.

    ADVERTISEMENT

    Around 2018, the $33 billion steel major set


    itself a somewhat direction-giving target of
    achieving EBIDTA savings of $2 billion only
    from using its data, over an unspecified
    number of years. Today, it reckons, it has
    milked $1.4 billion and is all set to move the
    goal post to a higher level of ambition.

    One does not readily connect AI with


    something as ‘physical’ as steel making, but
    Jayanta Banerjee, Chief Innovation O!cer at
    Tata Steel, explains how data and AI have
    become as important as iron ore and coke.
    :
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    Fluorine, SRF, Tata
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    Banerjee is a steel-outsider.
    chemicals An IT after
    sector
    professional, he wrote a paper
    weak Q1 on AI back in
    the early 1990s before joining Tata
    Consultancy Services, where he worked for a
    quarter century in TCS’s overseas o!ces.

    In 2018, Tata group’s Chairman, Natarajan


    Chandrasekaran, hand-picked a few IT
    wizards from TCS and put them into various
    other companies of the group. Banerjee ended
    up in Tata Steel.

    “I knew nothing about steel,” says Banerjee.


    But he knew data, and Tata Steel is always
    drowned in a flood of data.

    A date with Data


    Steel making is a heavily sensorised business;
    Tata Steel uses several lakhs of sensors in its
    five (Indian) plants. Most of them are
    :
    electronic, but some chemical and acoustic
    sensors too. In 2018, the company had about
    6 terabytes of data; today it has 5.2 petabytes
    (roughly, thousand times more).

    Humongous amounts of data implies you


    need to keep them somewhere. That is where
    ‘cloud’ enters the picture. “We invested
    heavily in cloud in 2018 and 2019,” says
    Banerjee, adding, “today 95 per cent of my
    estate is on multiple clouds.” The company
    uses the cloud services of Amazon, Google,
    Microsoft, Tata Communications and IBM.
    Multiple providers are necessary for reasons
    of security and building redundancy.

    So, Tata Steel had data and cloud, and


    Banerjee brought in AI, to make use of the
    former. Banerjee calls data, cloud and AI
    ‘three macros’. An in-house team developed
    about 260 algorithms on which the business
    runs. Alongside, the company scrapped the
    individual control rooms in its various mines
    and plants — each blast furnace had its own
    control room — and consolidated them
    under one IT building, the integrated remote
    operations center (iROC), in Jamshedpur.
    This brought in an added advantage —
    employees didn’t have to be transferred to
    di"erent places, as all the operations of the
    company are controlled from here.

    AI is used a lot in decision making. Take raw


    material procurement for example. As
    Banerjee explained, questions such as which
    raw material to buy; when, where and what is
    :
    the best route to ship it into the plant;how to
    e!ciently allocate the raw materials to
    di"erent plants, are best answered by AI
    models.

    Furthermore, AI is used in optimising


    chemical mix in blast furnaces. This is
    important because when raw materials like
    coal are transported across long distances,
    some impurities (moisture, foreign materials)
    will inevitably seep in. The quality of the raw
    material will determine what else should go
    into the furnace — how much manganese,
    zinc, among others. “Impurities in the output
    product will be much lesser if I have better
    chemistry upstream,” explains Banerjee
    adding that fine-tuning the mix is done by AI.

    Fault finder
    Further along the production line, AI also
    helps in identifying the origin of a defect. All
    products are fully imaged to find defects
    (crack, bubble) before it becomes final . If a
    defect shows up in an image, the product is
    not supplied to the customer. The image is
    then image is compared with an outsourced
    library of defect images, to see which one it
    resembles the most. This gives them an idea
    of what could have gone wrong. Once the
    origin of the defect is known, it is created on
    the ‘digital twin’ of the plant, where an AI
    model learns about the defect and its origin
    — it won’t let it happen another time.

    All this happens on the production side. Tata


    :
    Steel also uses AI in a whole lot of areas like
    forecasting and planning, HR and customer
    and financial analytics as well.

    Banerjee keeps a sharp eye on the costs.


    Technology is used only when it positively
    impacts at least one of yield, energy,
    throughput, quality and productivity. Over
    the years, cost-benefit has improved. “When I
    started the transformation (around 2018) it
    used to be in the range of 1:4.3, today we’re
    almost running 1:10. Every dollar I spend, I
    get $10 back,” he says.

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    :
    COMMENTS SHARE Published on October 1, 2023

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