DB: Research & Development at Tata Steel focuses on development of new products, improvements in processes, harnessing and guiding knowledge as well as in generating HR capacity for the company.

TN: What are the thrust areas for R & D?

DB: The research and development programmes are guided by the future directions of the Company. Long term projects have been taken up in the thrust areas of the company.

Tata Steel intends to be a 15 million tonne company by the year 2010. The company wishes to be a significant player in what is to be a 50 million tonne automotive steels market. That translates to around 5 of the 15 million tonnes produced being auto grade steel. Therefore, one of the long term (3 to 5 years) thrust areas in which R&D is working is high strength, formable steels for automotive applications. This area is covered by a whole basket of projects covering alloy development, hot and cold rolling, annealing, coating, welding and forming.

As we rapidly increase capacity, the consumption of raw materials will increase and therefore we need to make our processes more efficient since crucial inputs are likely to be in short supply. To reach our objectives we need knowledge and technology. Research initiatives in two long term thrust areas addresses the raw materials needs. One of these areas is complete beneficiation of iron ore and the other is in reducing coal ash without reducing yield. Increasing the productivity of blast furnaces is also a thrust area project.

The company’s future growth in the ferro-chrome business is being addressed through a fifth basket of thrust area projects on ferro-chrome – the total process.

While much of the research is carried out in Jamshedpur, in this day and age no company can carry out all its research in house. Our R&D too collaborates extensively with the best brains in related fields all around the globe. Not only do we collaborate with the IITs, IISc and CSIR laboratories, but also with the University of Cambridge, UK, Royal Institute of Technology, Sweden, University of New South Wales, Australia and the University of Erlangen, Germany. The focus is to leverage existing knowledge and rapidly increase our capability to achieve the company’s business objectives.

TN: In which areas of steel making is the clamour for Intellectual Properties the most apparent?

DB: Product Development in the auto sector is extremely fast moving. Manufacturers also demand contradictory properties such as strength and formability. Then again, environment standards compel manufacturers to reduce the weight of the car and add on requirements such as corrosion resistance and high welding electrode life. Therefore, for this segment, knowledge immediately means a competitive advantage. Product patents are, therefore, essentially for the auto segment. To give an example, in 2002 Nippon Steel (NSC) filed 62 patents in the US alone, many of which are product patents. NSC has more than 2000 active patents compared to 133 of Tata Steel’s — none of which are product patents. We are fortunate that the likes of NSC do not have any patents in India that affect us today. Actions are being taken not only within the company, but also at the Tata Group level to address the product patent issue.

TN: What is Tata Steel doing for product development?

DB: Tata Steel goes about its product development in three ways. For products that require technologies patented by another company (such as Extragal of Arcelor), Tata Steel goes for technical collaboration with that company for developing the product. This is driven by the Technology Groups and Marketing.

In the second mode, product development is carried out by R&D in close coordination with the Technology Groups, Operations and Marketing following the annual product portfolio matrix. Some of these products take 6 to 12 months to commercialise.

In the third mode, products for the future are developed through long term projects which we have discussed earlier. Development of these products requires up-gradation of knowledge not only in alloy development and metallurgy, but also in application areas such as forming, coating and welding. Extensive collaboration takes place in these areas, based on the expertise available world wide. R&D has also initiated a Visiting Scientist scheme through which internationally acclaimed scientists spend more than 3 months in Jamshedpur working on projects of Tata Steel’s interest with Tata Steel’s researchers. One such visiting scientist is dedicated to the long term project on development of high strength formable steels for automotive applications.

Vital inputs to future product development come from customers. Many initiatives have been taken to capture customers’ views and to understand the customers’ language. We should also be in a position to influence the customer’s choice of materials at the design stage of his product. With these in view, R&D has placed a researcher on the premises of a car manufacturer.

TN: How do R&D and product patents affect our future?

DB: In Tata Steel we have to spend the time and resources to develop and patent our own products. Otherwise we will continue to acquire know-how of manufacturing products that exist in some one else’s basket. We might then be in danger of being reduced to the status of external manufacturing and marketing agents for those who hold the patents. The markets will belong to them, with royalty having to be paid for any product we make and sell. As we ourselves graduate into being a global player and enter new markets we also need to have our patents in place. Moreover, and equally importantly, we need to be aware of our competitors’ existing patents. Violating existing patents can cost us in terms of money, market and image. An example of this was the case of Usinor (now a part Arcelor) introducing a new product for exhaust pipe application in the US market in 1995. While Usinor had valid European patents, they overlooked existing patents of AK Steel in the US. AK Steel slammed litigation on Usinor for infringement on 48 claims. Cases still continue, some of them still in the minor courts. Therefore, Tata Steel and the Tata Group need to accelerate the creation of a patent savvy culture.

In order to own the market of the future, the company needs to carry out research in areas not covered by prior art. This would involve exhaustive and continuous patent search and commitment to research. Best practices can be found in the drug and pharma companies. Ranbaxy is doing India proud through matured IP and R&D policies.

TN: How long will it take us to ensure that our Intellectual Properties are protected?

DB: It will take us about one year to have a policy and a working system in place and perhaps another year to bring the system up to speed. Generating and protecting our IP will be a continuous process. In the era of globalisation we should also be continuously conscious of not infringing upon others’ IP.

TN: What is the company’s strategy vis-a-vis R&D?

DB: The strategy of R&D for Tata Steel is to emerge as a complete solution provider for the company, to be the world’s best in research in selected areas and to enhance the image of Tata Steel as a research driven company.