October 2004 | Saloni Meghani

Tin can

Different Tata companies with different objectives embraced the singular path of innovation to achieve breakthroughs and triumphs. Perspectives on how innovation worked wonders for the Tinplate Company of India

The Tinplate Company of India (TCIL) decided to think out of the box. It thought along the curves of the can. The company took the lid off the big picture and realised that the can market, the mainstay of its business, was threatened by tetra packs, plastics and other packaging mediums. It realised that tinplate, used for processed edibles, beverages, and even non-edibles like chemicals, paints, aerosol, battery jackets, crown caps, and closures, was being crowded out of shelf space.

Instead of struggling alone to increase its share of an uncertain pie, it joined hands with the other members of the value chain to make the pie larger. The innovative marketing initiative came in 2000 in the form of the Tinplate Promotion Council (TPC).

The TPC consists of founder member TCIL, its promoter Tata Steel, its only domestic competitor, the Steel Authority of India Limited (SAIL), and 12 major can fabricators. These members account for nearly 50 per cent of the metal output used in packaging in India.

The council has its task cut out. It has to put the spirit of 'I can' back into the tin can. "This association looks at the future of the tinplate and can-making business at a national level. Its focus is on market development," says the man behind the mission, Bushen Raina, managing director, TCIL.

This has been done abroad earlier by the association of European producers of steel for packaging called APEAL, with which TPC also has a strategic alliance. But in India, the ground to be covered is larger than it is in other parts of the world.

Consider this: Americans, who live in a 'tin can civilisation', use more than 200 million cans each day. The world consumes an average of 8-10kg of this metal per capita. Against that, the consumption in India is a mere 0.3kg. That gives tinplate a lot of elbowroom in our country.

What the industry needs to do is to raise its hand to be counted. So the council is playing up the technical, environmental and economic edge of tinplate with the food processors and fillers who use the metal as also the general consumers at large.

This strategy has hit the nail on the head. The company that spearheaded this lateral route to the market has gone through an unprecedented turnaround. The 82-year-old TCIL is has made the highest ever profits in its entire history in 2003-04.

"We now produce 2.5 times what we manufactured earlier. Our exports have gone up from negligible to 25 per cent of the entire output. We have increased our overall market from about 15 per cent in 1997-98 to more than 35 per cent in 2002-03," says Mr Raina.

The industry level move has transformed TCIL from a downstream steel-processing unit to a leading provider of cost effective packaging solutions. This leap in perspective became an imperative for the company in about 1998. "For many years, TCIL considered itself a part of the steel industry and a company in the business of making tin mill products. "Our psyche and personality was like a downstream unit. We had lost focus on the markets we were servicing and the competition we were facing. We had to revisit and redefine our business," says Mr Raina.

When the company was compelled to look inwards for its own survival, it realised that it was actually a part of the packaging industry. Having zeroed in on its trajectory — to become the leading provider of cost-effective metal packaging solutions for processed edibles — TCIL changed the management of its key business processes to this end. "Now, we are graduating from being a supplier to being a solutions provider," says Mr Raina.

Earlier the company was geared to look at can fabricators as its only customers. But now it confronts the fact that they too are only members of the value chain. The decision for tinplate consumption is actually taken by product managers at the processors' end. The company realised that it had never attempted to influence the processors' decision. "We did not know what was happening with our customers' customers like Amul, Nestle or Britannia. We did not understand their requirements," says Mr Raina.

TCIL has streamlined its organisational structure to align with its redefined goal. With the help of McKinsey, it has developed a customer management programme. For the last three years, it has had relationship managers for key accounts and customers.

Having joined hands with the can makers, TCIL has not only got its finger on the pulse of its real market and the changes it goes through, it has also gained a lot of knowledge about the can making industry.

The criteria for measuring the performance of the marketing division has also moved from the tonnage of the output sold to the number of tinplate solutions thought up. The company is targeting solutions at the rate of a-can-a-month. In order to make the tin can more modern and appealing, TCIL has roped in the National Institute of Design (NID) to set the wheels of creativity turning. NID designed a can for the edible oil consumer pack segment, where alternative packaging material had almost completely substituted tinplates. It is also carrying out a survey to assess the needs of the fabricators, fillers and ultimate consumers and competitors' offerings.

TCIL has been driving similar innovations across the entire industry along with the TPC. Recently, the council held an awards night, compered by quizmaster Siddharth Basu, to applaud the industry innovators. Such encouragement has helped members of the value chain look at options like making the metal lighter. The companies keep working on ways to reduce the weight of the can without compromising on its quality and durability.

In fact, the council has set up groups to address product design and development, marketing, and publicity and publications. With its international seminars, exhibitions, quarterly newsletter, and a manual on tinplate, the industry intends to drive its point home — tinplate is the best packaging medium as it is tamper-proof, has excellent printability and is unaffected by ultra violet rays. Its contents retain their properties for a guaranteed three years. Add to that the fact that it can be removed magnetically from trash and put back into the furnace for melting and is thus eco-friendly.

No wonder then that it has been around for more than a century. Way back in the late 18th century Napoleon's army was suffering more from malnutrition than due to actual combat. Napolean offered a fortune to anyone who could develop a way to preserve food for the battlefield. French confectioner Nicolas Appert took home the prize in 1809 after discovering that heating food in tinplate cans served the purpose well.

This story, among the many other interesting facts about tinplate that time has cloaked, is highlighted in a slick and informative film made by the council to promote its favourite medium. The protagonist of this film is a trendy tin can who has not only the substance to make it but also the good looks to charm everyone along the way.