KIRLOSKAR ELECTRICALS LIMITED
Submitted in partial fulfillment for the requirements for the award in
MASTER OF BUSINESS ADMINISTRATION
B A N G A L O R E U N I V E R S I T Y
BY
GEETHA.B
(09P6CMA017)
U n d e r t h e G u i d a n c e o f
Prof. B H A G Y A R A T H N A.R
COMMUNITY INSTITUTE OF MANAGEMENT STUDIES
I hereby declare that the “Internship report on Organisation Study” at
KIRLOSKAR ELECTRIC COMPANY LTD, Govenhalli is a record of independent
work carried out by me, towards partial fulfilment of the requirements for MBA
course of Bangalore University at Community Institute of Management Studies. This
has not been submitted in part or full towards any other degree or Diploma of any
other Institute or University.
PLACE: BANGALORE
GEETHA.B
This project is an outcome of all the efforts and co-ordination of various people.
First and foremost, I express my sincere and heartful thanks to D
R. B.S. SURESHBABU , MBA Phd Honarable Director Department of MBA for the giving me an
opportunity to do this project.
I am also grateful to the esteemed organisation KIRLOSKAR ELECTRIC
COMPANY LTD co-operation during my project. An all the faculty who provided
full support in completing this project successfully.
I would be afflicting myself if I do not profess my sincere appreciation to my dearest
parents, sister and friends who helped me in every step.
PLACE: BANGALORE
GEETHA.B
NUMBER
CHAPTER
NUMBER
1
INTRODUCTION
1-10
2
• INDUSTRY PROFILE • COMPANY PROFILE • PRODUCT PROFILE • VISION/MISSION 11-13 14-32 33-38 39-403
KEY FUNCTIONAL
DEPARTMENTS
• HUMAN RESOURCE DEPARTMENT • ENGINEERING DEPARTMENT • PRODUCTION DEPARTMENT • MAINTENANCE & QUALITY ASSURANCE DEPARTMENT • MARKETING DEPARTMENT • FINANCE DEPARTMENT41
42-50 51-52 53-63 64-69 70-76 77-816
SUGGESTIONS
85
7
CONCLUSION
86-87
BIBLIOGRAPHY
88
Revolution or analysis of electric industries-
Like every other industrial sector in India, the Indian Electrical/Electronics Industry too is slowly emerging from out of its "protective cover". For far too long has Indian Industry remained shackled and consequently inward looking. Over the past fifty years there was no exposure to global players and competition, with the result that the Industry grew up in a sheltered environment, dependent on the Government for everything, from licenses to protection to tariffs. Each one of these interventions was aimed at securing protection for oneself and ensuring growth of one’s own organization at the cost of industry and the nation at large. Lack of global competition encouraged a "cost plus" approach, where every conceivable cost increase was passed on to the customer.
There was thus no motivation to reduce cost.
With deli censing, decontrol and deregulation, Indian Industry has suddenly been exposed to global competition. Since last decade, India has witnessed what global players have achieved and what they are capable of achieving. We are becoming aware of competition on our turf. In this scenario, every company complains of increased competition, lower order books and shrinking margins. The Indian Electrical/Electronics Industry is of course further besieged by the fact that there is a dearth of business on account of lack of investment in the power infrastructure. Many organizations in this industry are looking overseas to develop the export markets owing to reduced demand at home.
At the outset, it must be stated that the reduced domestic demand is at best a temporary phenomenon. The power sector in India is bound to grow and this will undoubtedly boost demand from the Utilities, quite apart from the industrial demand which will continue to grow with increased industrial output. The poor financial health of the SEBs is however a damper that cannot be wished away in the short term. This will continue to plague corporate in the Electrical Industry, until the SEB restructuring and unbundling brings a turnaround in the medium term.
3 core submersible flat cables, 3 Point Locking Mechanism, AC boxes, ac contactor, Ac Drives, Ac Motors, AC plug & Sockets, ac-dc switching power supply, ac panels ,Actuators ,Adapters, agricultural pump sets, air break switches, aluminum chokes, alternators , Aluminum Compact Chokes, aluminum crepe paper, Amplifiers , Analog & Digital Temperature Controllers, anchor switches & accessories.
ABB EMCO Crompton Greave BHARATH BIJLEE Havel s India NUMERIC POWER Techno Electric EASUN REYRL HBL Power HONDA SIEL
GROWTH RATE OF INDUSTRY:
The growth that the company has witnessed over the past five years has been sustained in a strong and steady way. After completing the restructuring activities in 2004, the company has grown to its highest ever turnover of Rs. 728 Crores with a profit after tax of Rs. 23.7 Crores in 2007-2008. These correspond to a growth rate of 23% in turnover and a 32% in profit.
CUSTOMERS OF THE INDUSTRY:
Pump applications, Fan Applications, Compressor Applications, Crusher Applications, Ball Mill, Blower Application, Prime mover for Conveyers, Crane Applications, Fibrizer Applications in Sugar Mills, Cement mills, Steel Rerolling Mills, Telecom, Service Industry (Banks, Ins, Fin), Retail Chains, Hospitality, Health Care, Govt. Departments, Railways Utilities, Defense, Para Military, Rubber, Plastic, Textile, Paper, Printing, Agriculture, Commercial establishment utilities, Petro Chemicals, Fertilizer, Nuclear, Automobile, Marine, Defense, Power Co Generation Projects, Wind Energy Infrastructure, IT, Engineering Companies, Contractors, Dealers, Project Houses, Test Rig, Institutions: Banks, LIC, CPWD, MES, Ports, Power, Airports, Builders, GOVT Agencies, Industries, Chemical, Pharma, Crane & Elevator.
STAKEHOLDERS OF THE INDUSTRY:
The Audit Committee consists of five independent Non-Executive Directors.
The terms of reference to the Audit Committee cover the areas mentioned under Clause 49 of the Listing Agreement and Section 292A of the Companies Act 1956, besides some other functions as referred to it by the Board of Directors.
Name Of Director Category
Mr. S.N.Agarwal Chairman
Mr. A.S. Lakshmanan Member
Mr. Anil Kumar Bhandari Member
Mr. Sarosh J Ghandy Member
Mr. V.P.Mahendra Member
SHAREHOLDERS
The Shareholders/Investors Grievances Committee consisted of three Directors. The terms of reference of Shareholders/Investors Grievances Committee include, interalia, to look into the shareholders and investors complaints regarding transfer of shares, non receipt of balance sheet, non receipt of dividends etc and to redress the same.
Name Of Director Category Mr. Anil Kumar Bhandari Chairman
Mr. Vijay R Kirloskar Member
Mr. P.S. Malik Member
Remuneration Committee
The Remuneration Committee consists of following Directors:
Name Of Director Category
Mr. S.N.Agarwal Chairman
Mr. A.S. Lakshmanan Member
Mr. Anil Kumar Bhandari Member
Mr. Sarosh J Ghandy Member
Ms. Meena Kirloskar Member
KEY SUCCESS FACTOR OF BUSINESS:
In the first half of this fiscal year, the manufacturing sector in India has again shown a Healthy performance» Nearly 65 per cent of Manufacturing sectors continue to show Substantial growth, says the ASCON survey Carried out by the Associations Council of the Confederation of Indian Industry (C1I). Distribution and Power Transformers have both Shown a high growth among the Capital
Of- the-art equipments. In this issue of Watts Up, we focus on the Growth of the transformer industry with the technical articles covering AVR's and testing related to transformers. The spotlight section takes you to the transformer manufacturing division in Mysore. We have covered the happenings with our vendor's meet and finally, we conclude this issue with a round up of the Kirloskar Electric family.
INTRODUCTION
The only constant that we know is that, this world is changing. Change had come to Indian industry like a sweeping tornardo transforming the industrial environment and giving indegeneous industry some very tough standards to measure up to. In this testing situation, only the fittest have the wherewithal to survive. Only the best will thrive.
That Kirloskar Electric has not only survived but has grown in confidence, capabilities, range and were scope is a testimony to the inherent strength of its foundation as a company that once set out to revolutionized India’s agricultural sector with value engineering.
The difference is in the collective outlook of people trained to look upon every challenge as a platform from which to take giant leaps in quality and performance. And in so doing, to build on core capabilities of power engineering and upgrade them to world standards.
The founder of Kirloskar group is late “LAKSHMAN RAO KASHINATH
KIRLOSKAR”. He was born in 1886 in a village called GULAHASAR in Belgaum district. He had
preference for mechanical from his school days and therefore came to Mumbai and completed a course of technical draftsman ship at JJ school of arts. He started business of selling and repairing the bicycles.
Visionary founder Laxman Rao Kirloskar created the first Iron plough for the Indian farmer. His involvement with agriculture led him to make the first pump then the prime movers for the pumps. Since then KEC corporate goal has been to look into the future and engineer products that time would eventually demand.
FOUNDERS
Laxmanrao Kashinath Kirloskar was a successful industrialist, but his chief merit lay in
the trail he blazed, for the principle in life he depended upon were his vision and a spirit of pioneering.
LAXMAN RAO K KIRLOSKAR, Founder, Kirloskar Group of Companies
Ravindra L. Kirloskar was the youngest son of Laxmanrao and Radhabhai Kirloskar, who
later headed KEC operations.
Having a degree in Electrical Engineering from the Worcester Polytechnic Institute, U.S.A. he began his professional career in Kirloskar Brothers. In 1942 he designed and built India's first Electric motor at Kirloskarwadi with his colleague N.K.Joshi. He guided us to the highest level of quality...
"Quality must go beyond standard tests and procedures. It must be equated with self respect and personal pride."
Ravi L Kirloskar, second – generation entrepreneur, son of the visionary, built a bank of prime technological skills and capabilities. And a state of art facility that has since then continuously reinvented itself to meet the changing demands of a changing market – just that one step ahead of time.
With long years of innovative application behind it, Kirloskar Electric finds itself completely capable of delivering a range of custom engineered products that meet and exceed global standards at very competitive prices.
Moving smoothly from agricultural sector to industry, to transport, to defense, to power generation, Kirloskar Electric products have had more than a significant contribution to make to India’s rapidly evolving economy.
RAVINDRA L. KIRLOSKAR , Founder, Kirloskar Group of Companies
INDUSRTY PROFILE
Heavy industry in India comprises of heavy engineering industry, machine tool industry, industrial machinery and auto industry. These industries provide goods and services for almost all sectors of the economy, including power, rail and road transport. The machine building industry caters to the requirements of equipment for basic industries such as steel, non-ferrous metals, fertilisers, refineries, petrochemicals, shipping, paper, cement, sugar etc.
HEAVY ELECTRICAL INDUSTRY
Heavy electrical industry covers power generation, transmission and distribution and utilization equipments. These include turbo generators, boilers, various types of turbines,
transformers, switchgears and other allied items. Majority of the products are manufactured by heavy electrical industry in the country. Some major areas where these are used are the multi core projects for power generation including nuclear power stations, petrochemical complexes, chemical plants, integrated steel plants, nonferrous metal units, etc. India is the only developing country besides china which produces a full range of electric power generation and transmission equipment. The industry has been upgrading the existing technology and is now capable of taking up turnkey contracts also for exports markets.
Foreign collaborations are allowed with 100 percent FDI. The country is planning to add 150000 MW power generation’s capacities in the next ten years this will generate substantial demand for heavy electrical equipments. The heavy electrical industry is capable of manufacturing
transmission and distribution equipment up to 400 KV AC and high voltage DC. The industries has taken up the work of up gradation and transmission to the next higher voltage system of 765 KV facilities to and have upgraded their manufacturing facilities to supply 765 KV class transformers, reactors, CTS, CVT, bushing, insulators, etc.
The investment in R & D by the electrical industry is the largest in the corporate sector in India. Large electrical equipment used in steel plants, petrochemicals complexes and other such heavy industries is also being manufactured in the country.
The domestic heavy electrical equipment manufacturers are making use of the developments of the global market with respect to product designs and upgrading of manufacturing and testing facilities. The heavy electrical industry has established its reference in the global arena also. These encompass thermal, hydro and gas based power plants, substation projects, and rehabilitation. Projects, besides a wide variety of products like transformers, photo voltaic equipments, insulators, switchgears, motors, etc
GENERATOR SETS
AC generators manufactured in India are on par with international AC Generators and consistently deliver high quality power with high performance. Domestic manufactures are capable of
manufacturing AC generator right from 0.5 KVA to 25000 KVA and above with specified voltage rating.
TRANSFORMERS
The industry has the capacity of manufacture whole range of power and distribution transformers including the REC rating of 25, 53, and 100 KVA and also the extra high voltage range of 400 KV, 600 KVA.
SWITCHGEAR AND CONTROL GEAR
In India, the entire range of circuit breakers from bulk oil, minimum oil, air blast, vacuum to SF6 are manufactured to standard specification for the benefit of customers, the ranges of products produced cover the entire voltage range for 240V to 800KV, switchgear and control gear, MCBs, air circuit breakers, switches, rewire able fuses and HRC fuses with their respective fuse bases, holders and starters. The industry is competitive in the field of design and engineering as the skill sets available in the country are relatively less expensive.
HISTORY OF KIRLOSKER ELECTRIC COMPANY:
1888- Engineering Brother Enterprise was established by Mr Lakshman Rao & Mr Kashinath
Kirlosker.
1901- India’s first Mechanical Fodder Cutter Machine made. 1904- First Iron ploughs was Invented
1924- Export of Ploughs to Britain begins.
1940- India’s First Vertical Diesel Engine Manufactured. 1942- First AC Induction Motor made in India.
1946- Kirlosker Electric & Kirlosker Oil Engines established. 1949- India’s First 5HP AV1 Engine Manufactured.
1953- India’s First Transformers Manufactured.
1958- First Alternator in India was invented, Kirlosker Pneumatic Company Established. 1964- First Electronic DC Motor Made in India.
1970- Mr. Ravi Kirlosker Appointed as Managing Director. 1973- First Overseas Established In Malaysia.
1984- JV Established for Specialization in Pumps. 1988- Completed 100 years, a Centenary Year. 1991- Established in Singapore.
1992- Kirlosker Ferrous Established. 1993- ISO 9001 Certification.
1994- Mr. Vijay Kirlosker was appointed as Chairman. 2008- Kirlosker acquires LDW, & established in Holland.
COMPANY PROFILE
NAME OF THE COMPANY : KIRLOSKAR ELECTRIC CO LTD DATE OF ESTABLISHMENT : 1948
SALES HEAD QUARTER : BANGALORE
FACTORY LOCATION : GOVENAHALLI, BANGALORE CONTACT PHONE NUMBER : 08023374865
AUTHORISED CAPITAL : 42 CRORES
LAND AND BUILDING AREA : 16 ACRES & 4.16 ACRES FINANCIAL YEAR TURNOVER : 245 CRORES
In 1946, kirloskar limited company was registered as a joint stock company to manufacture electric motors, transformers, generators and other electrical products. The company started its production in 1947. It had its initial collaboration with M/s Brush electrical company USA. The company
manufactured its first electric motor in 1948. Now in its sixth decade company manufactures a wide range of AC and DC motors and generators up to 5000kw. Even as the company continues to grow its core business of rotating machinery new horizons have opened up in the field of industrial electronics.
Laxman Rao kirloskar (Founder of Kirloskar group) designed the first KIRLOSKAR product the corn plough was mainly aimed to benefit the farmers. This was an innovation far ahead of its time that originated the kirloskar group. The experiments never stopped but followed by the
manufacturing hand pumps, mechanized pumps, sugarcane crushers, peanut sellers and other mechanical equipments.
All these products brought a great revolution on agriculture in the name of Kirloskar brothers, who were behind every major Kirloskar organisation including Kirloskar electric company.The company has signed licensing agreements with world leaders such as Thron-EMI, Fuji electric and Toshiba among others for the manufacturing of inventors, thirstier, converters and uninterrupted power sources respectively.
“The spark of genius innovation continued and ventured on a range of Kirloskar group of companies, which has helped India today”. Kirloskar electric company mission faster excellence in designing, manufacturing the products and services with innovative and challenging initiatives.
KEC believes that its strength is derived from its people. The company training programmes for its engineers and continues retraining of its employees gives it a technological and managerial edge. It is
the strength that allow kirloskar to take successfully any new field it entry to develop its current business and to promote sustained improvements in quality. The company has one of the finest manufacturing facilities, specialized infrastructure for design, manufacture and testing;
complementing a very high level of application engineering and total quality concept, contribute to reliability that is trusted in India and Abroad.
KEC manufactures following standard and customized range of products for various applications:
• AC Motors • Alternators/ AC Generators • DC Machines • Electronics Switchgears • Traction • Transformers • DG Sets.
KIRLOSKAR ELECTRIC COMPANY AIMS AT:
➢ Manufacturing the quality and leading electrical products with the help of latest international technology.
➢ The brand name of the quality for electrical product in across the globe.
➢ Kirloskar values are established in gaining excellence in engineering and marketing its mission successfully.
➢ Ensuring customer satisfaction.
➢ Manufacturing products of highest quality using state of the art technology.
OBJECTIVES OF THE COMPANY:
To provide products of highest quality and value.
To achieve cost effectiveness in machine shops and production process etc.
To invest in the technology to achieve technological excellence and competitive edge. Commitment for continuous improvement in process, methods productivity and quality.
To reduce wastage throughout supply chain. Human resources development.
Quality objective.
The factory plants are located at five places namely:
1. Bangalore rural (Govenhalli, Nelamangala)2. Hubli
3. Tumkur
4. Mysore
NATURE OF BUSINESS CARRIED
The business carried by the KSL is production of industrial goods viz., A.C motors, D.C motors, generators etc. The KSL produces the motors, generators and transformers in national as well as export to many foreign countries. The KSL Company mainly manufactures heavy volt motors and a generator as per the customer requirements. The company has no competitors for the kind manufacturing. It only faces competition from foreign companies. This company has a kind of monopoly in producing big motors and generators in India. The company has established 5 offices
as global centre, which are situated at
• Singapore • Malaysia • Michingan • Germany • Sharjah
BOARD OF DIRECTORS
:As on Dec 2009, the Board of Directors of KEC comprises Eleven Directors. The Board consists of the Chairman & Managing Director, who is a promotor Director, Two Executive Directors and Six non-Executive Independent Directors. Details are given below:
Mr. Vi jay R Kirloskar
Chairman and Managing Director
Mr. Malik P.S.
Joint Managing Director
Non Executive Independent Directors:
PROJECTS UNDER TAKEN BY KIRLOSKER ELECTRIC COMPANY:
Kirloskar Electric ventured into Projects and Systems Group (PSG) understanding the Potential requirement of the industry.NAME OF DIRECTORS CATEGORY OF DIRECTORSHIP
MR. VIJAY KIRLOSKAR EXECUTIVE-CHAIRMAN & MANAGING
DIRECTOR PROMOTER
MR.A.S. LAKSHMANAN NON EXECUTIVE INDEPENDENT DIRECTOR
MR.S.N. AGARWAL NON EXECUTIVE INDEPENDENT DIRECTOR
MR.ANIL KUMAR BHANDARI NON EXECUTIVE INDEPENDENT DIRECTOR
MR.SAROSH J GHANDY NON EXECUTIVE INDEPENDENT DIRECTOR
MR.V.P.MAHENDRA NON EXECUTIVE INDEPENDENT DIRECTOR
MR.KAMALESH GANDHI NON EXECUTIVE INDEPENDENT DIRECTOR
MRS.MYTHILI BALASUBRAMANIAN NON EXECUTIVE INDEPENDENT DIRECTOR
NOMINEE IDBI
MR.RAMESH D DAMLE NON EXECUTIVE INDEPENDENT DIRECTOR
With state-of-the art manufacturing support, Projects and Systems Group has performed the best winning the challenging and reputed orders all over India. It has provided solutions from the project concept to commissioning by integrating Design, Supply and Installation for large projects.
Switchyards & Power Distribution
The central philosophy of PSG is to offer a complete system of Electric Control and Automation that is handled by us as a single source.
Sugar Industry
Surplus energy converted into electrical energy.
Cement Industry
• Fuel gases at high temperatures passed through four pre-heater stages.
• Temperature is reduced to 150 – 200 degree.
•
Fertiliser Industry
PSG formed this group to meet the challenges of Power Generation using Non-Conventional Energy Sources.
PSG has expertise and experience in following main projects:
. Micro/Mini & Small Hydel Projects
• Co-Generation Projects • Wind Energy Projects • Solar Energy Projects • Gas Based Power Projects • Diesel Based Power Projects • Wave Energy Projects
Steel Industry
High temperature exhaust gases are used for better energy recycling. In association with turbine manufacturers cater to the requirements of the power plants and offer complete electric's like generator and associated controls for diesel, small hydel projects, wind power plants and co-generation plants.
PSG designed and executed complete electrical system for country's first co-generation plant at Tasco Cheyyar, 5MW in Tamil Nadu and The Ugar Sugar, 32MW in Karnataka and thereafter developed many co -generation plants.
PSG has successfully designed, manufactured, supplied, tested and commissioned couple of challenging projects.
KEC has executed first co-generation project in Karnataka for Sugar of 30 MW in the year 2000. KEC has also executed such co-generation projects for Prabhulingeshwara Sugar (16 MW) & Varalakshmi Sugar (20 MW) in Karnataka.
Co-Generation: "Combined Generation" by conversion of energy contained in a fuel into two or more usable forms.
The role of PSG in Switchyards and Power Distribution are:
PSG has developed expertise in Design, Engineering, Supply, Erection and commissioning of Electrical Switchyard upto 220kV.
PSG has successfully commissioned total electric's including switchyard and plant electrification for Toyota Kirloskar, Sulzer Flowel, KFIL, NALCO, BFL, Enercon, Hero-Cycles, and DGS & D Port Blair, just to highlight a few valuable clients out of the total list.
PSG in association with General Electric Drive System USA had supplied the total electrics & automation package of 2 Million tonnes per annum to Steel Hot Strip Mill of Essar Steel Ltd., in Gujarat, India.
MILESTONES
India's first satellite tracked
Proud scientists celebrated the successful tracking of India’s first satellite. The meticulously planned event was held in Hassan, Karnataka. The team had finalized the specifications for AC generators with Kirloskar Electric Co., taking care of intricate details like transient loading and transient voltage regulation performance.
Missile test fired
The first ever indigenously built missile was test fired in early 90's, year before; premiere defense organizations perfected the intricate performance requirement of the power supply unit. KEC played a key role in building the entire power supply unit. The AC Generators of KEC were customized for arduous duty.
India explores Antartica
India was the first developing country to join the Antartica explorations. The task team behind this feat had done the homework right. They carried with them specially designed AC Generators, developed by KEC that worked perfectly in sub zero temperatures.
Rajdhani flagged off
The research wing of India Railways worked with specialists
from KEC to design highly reliable AC Generators that would take that heat, dust, smoke and the acceleration of the bogie and continue to function giving passengers of the Rajdhani greater speed, greater comfort and increased safety.
Stealth ship launched
On 18th April 2003, national dailies splashed the launch of the first indigenously designed stealth ship. The ship has four KEC 1000kW AC Generators which are the result of our close association with Indian Navy, in the supply of AC Generators, for frontline battle ship.
In the lab the Defense experts drenched it with salt spray, blasted it with sand, vibrated it, heated it in an oven, and rocked it over the bumps. In the field they hauled it from deserts of Rajasthan to marshy areas in Assam and yet the KEC AC Generator worked for decades. They wanted to verify whether the AC Generators bleeds as human do when they land up in Leh, the highest place inhabited on earth and they did id with success. That is why KEC remains the most preferred make by the Defense establishments.
Fighter aircraft ground tested
Fighter jets, cargo planes, troops carriers, helicopters used by the Indian Air force has different versions of ground power units to verify their systems. KEC took up the challenge to develop a power source for testing a variety of aircrafts. By indigenously designing, manufacturing and supplying AC Generators of 400HZ for defense applications.
Spotting the enemy on radar
The system and network to spot enemy air-craft on the radar is complex and requires a variety of power sources. Sensitive and classified projects involve supply of entire power pack and AC Generators in line with the stringent specifications. KEC has successfully implemented these projects and KEC's AC Generators are working for over 25 years in critical Defense applications.
Boom of guns
The anti aircraft guns and require reliable power supply as they work under extreme climates round the year. KEC has supplied these special purpose army generators and AC motors to keep these special purpose army generators and AC motors to keep the guns booming without fail.
Between waves and flames
Aboard the ONGC platform with gas flames on top and tidal waves at the bottom, the KEC AC generators are working for decades. The designers have taken care to protect the various components that perform in this treacherous environment.
CERTIFICATIONS OF THE INDUSTRY:
KIRLOSKER Is the first Electrical Engineering Company to get ISO 9001 certification in India .KEC is also the first electrical equipment manufacturing company in India to be awarded with certificate for providing ‘CE' Mark.
Kirloskar Electric is a pioneer in export of Electrical and Electronic goods for the last four decades.
Bureau Veritas Quality International (BVQI) has certified the Quality Management System of KEC. We are also first in electrical industry to obtain ISO 9001-2000 certification by BVQI.
The ISO 9001-2000 certificates awarded to: KEC - Bangalore, Hubli, Mysore, Tumkur.
KEMA' registered quality B.V.Netherlands, notified authority have tested our products with respect to low voltage directive, EMC (Electromagnetic) directive and MD (Machinery) directive.
CE' stands for ‘CONFIRMATIVE EUROPEENNE' and conformity to European standards meeting basic requirements of Safety, Health, and Environment & Protection (SHEC).
KEC is entitled to provide 'CE Marking' for AC motors, AC generators and DC machines. ‘CE' marking allows the product un-registered legal access to the European market.
We are proud of having established an independent laboratory duly certified by NVLAP - NIST, USA for testing of energy efficient 3 phase Induction motors up to 50 HP.
Kirloskar Electric Test Laboratory (KETL) is first in India and among few in Asia to get NVLAP Accreditation.
SAFETY MANUAL: (CERTIFICATION FOR AC MOTORS)
KEC PRODUCTS are designed and manufactured products according to the
standards of:
• ISO (International Organizational for Standardization)
• IEC (International Electro technical Commission)
• BIS (Bureau of Indian Standards)
• BSI (British Standards Institution)
• JEM (Japan Electrical Manufacturers Association)
AWARDS
• Best innovative product for digital drive by IEEMA at the elecrama exhibition.
• National award for R & D from the Department of Scientific & Industrial Research, Ministry of Science & Technology, India.
LOCATION OF OVERSEAS SALES OFFICE:
AREA OF OPERATION-GLOBAL/NATIONAL/REGIONAL Area of Operation-Global
ASIAN COUNTRIES OTHER COUNTRIES Saudi Arabia New Zealand
Oman United Kingdom Kuwait Africa
Syria France Malaysia Sweden Dubai Germany Srilanka Greece Kualampur Italy Singapore Turkey
Area of Operation National/Regional
Ludhiana Hyderabad Cochin Ahmadabad Lucknow Bangalore Coimbatore Pune
Jaipur Hubli Madurai Mumbai New Delhi Chennai Kolkata Guawahati
WORK FLOW MODEL
Marketing department receives the general enquiry from customers either in branch/unit offices, which order enquiry, is discussed with other related departments before further process viz, design, finance, production, purchase etc. After discussion with all the other departments the marketing department gives a quotation to the customer. Then a final inspection is received from the customer by the unit making negotiation before receiving purchase order from the customer. Once the
purchase-order is received at the office, marketing department will send an order acceptance to MIS and production department.
The marketing department will release a specification sheet where in all the customer’s order specification is taken into consideration. Then the design department will design the product process and release a bill of materials. Design department also carries the function of scheduling according to the total-time available to them to deliver the product. The purchase indent to the purchase department. Then the purchase department contacts the vendors, send purchase order to
inspection is carried on by the quality assurance department. After inspection of raw materials it is supplied to the factory for producing AC/DC Motors.
Once the production process is over, test is done and again the QAD carries on inspection (and also inspection made by the customer himself in certain cases) once payment is made by the customer the products will be despatched.
DIRECT CUSTOMER
1. Enquiry with specification. 2. Submission of quotation.
3. Discussion for technical & commercial matter between supplier and purchaser.
Sending order to the respective zonal offices and then to head offices.
Marketing department will receive the orders and prepares the contracts.
Work order will be prepared & sent to the PPC Department to prepare plan for production.
Design department designs the product format and sends to PPC Department.
PPC Department prepares a job card of the product based on design format and sent to Manufacturing Department.
Actual production process takes place in Manufacturing Department. Quality Department tests the product.
Painting & packing.
Despatch the product
DIRECT CUSTOMER
PRODUCT PRO
FILE
PRODUCTS MANUFACTURED BY KIRLOSKER ELECTRIC COMPANY
(unit 1):
AC MOTORS;
Kirloskar Electric was the first company in India to manufacture AC Motors way back in 1948. Since then it has manufactured millions of motors for domestic and International Market. Its initial technology support from BRUSH Electric UK & technical collaborations with NEI Peebles
Electrical Machines, Scotland and AEG of Germany enables KEC to develop high capacity motors for various applications. A strategic alliance with FUJI Electric of Japan enabled the company to absorb and implement state of art technology for motors.
enclosures. Voltages range from 340 to 13800 V. Class F insulation being standard for all motors, class H insulation is also offered for low voltage motors.
specifically designed for exacting duties. The modular design totally enclosed air to air heat exchanger is the first choice of industry for the more arduous applications. Compact rib cooled motors with unique internal cooling are used for duty atmospheres.
The Special motors list includes Roller Table motor, Mud Gun motor, Bell Annealing Furnace motor for steel mill applications. When India faced sanctions on supply for equipment for Nuclear Power Plants, KEC developed special Canned Pump Motors. Motors like explosion proof, increase safety and non-sparking ones used extensively in hazardous areas like coalmines, oil mines and petrochemical industries are available in a wide range. Specially designed adjustable speed drive motors in large numbers are working in various steel plants and other industries.
KEC is the only company in India and one among the 18 in the whole world to have the unique
certified facility for efficiency testing of induction motors up to 50hp. The laboratory has been certified by NVLAP (National Voluntary Lab Accreditation Program) USA.
APPLICATION:
Industries: Agriculture, Construction, Cement, Paper, Petrochemicals, Steel, Sugar, Textile. Power: Nuclear, Thermal.
Utilities: Cinema, Gas station, Hospitals, Hotels, Mill, Telecom.
DC MOTORS;
Kirloskar Electric from its fabled stable of DC Motors has put into international use more than 0.1 million motors since 1969. The wide product range in capacity and variety satisfies the needs of a multitude of applications. The Industrial Laminated Yoke range starting from frame 80 to 1250 with outputs of 0.75 to 3750 kW caters to the industry requirement of torques up to 1500K-Nm. The rugged and reliable higher range of motors are specifically designed for exacting duties in a hot and cold metal rolling mill drive, the sticky rubber mixer drive and continues duty cement kiln drive. These products come from an in house developed technology based on the best of world class international design and manufacturing concepts.
Kirloskar Electric has a history of excelling in special application and customization. It is this spirit that saw us develop complete electric for 5 & 10 cubic meter Electric Shovels for coal mines. Today, there are more than 150 Electric Rope working in Indian coal mines, completely powered by Kirloskar Electrics. India's premier aircraft manufacturing facility in Bangalore houses one of the worlds few high power and outdoor duty vertical DC motors, for helicopter blade load testing made by Kirloskar.
Continuing our efforts in supplying clean & efficient motive power to the environment friendly electric material handling equipment, it is only natural that KEC moves on to electric passenger vehicles. The prestigious CERN Super Particle Accelerator project in Geneva uses Kirloskar Electric Super Conducting DC Corrector Magnets in very large numbers. This is a high precision product of extreme reliability and has to work in a cryogenic environment.
The constant pursuit of newer applications has pushed KEC to enter space applications. Our space duty Brush less DC Servo Motors will provide the Rocket Nozzle control force in Indian space launch vehicle for the future.
The fully equipped and highly quality manufacturing facility backed by a strong force of dedicated and skilled design, marketing and service team with a focus on quality brings in great levels of reliability to the product that is trusted in India and abroad.
APPLICATIONS
AC GENERATORS;
For over four decades, four out of every five AC generators manufactured by the organized sector in India were made by Kirloskar Electric Company. This has resulted in a population of several million Kirloskar AC Generators.
Their simple construction, long life and easy availability of spares through a wide network of service centers make them the preferred choice in critical applications like nuclear, missile, petrochemical, power and other process industries.
The unique strength of the company in customizing AC generators for special needs of missiles projects, warships, battle tanks, and fighter aircrafts makes KEC the only company to offer AC generators for the widest of applications.
Continuous product development has kept pace with corresponding prime mover availability like wind mills, gas turbines, water turbines, steam turbines and variety of makes of diesel engines. The products quality based on world class technology and state-of-the-art infrastructure makes leading consultants specify Kirloskar Electric AC Generators again and again.
Kirloskar Electric offers AC Generators from 1kVA to 20MVA, right from low voltage of 220V to high voltage of 11000 volts, for synchronous speeds as high as 3000 rpm to as low as 375 rpm, for standard frequencies of 50hz or 60hz or even special 200hz and 400hz.
In alternatives of open construction or closed construction – air cooled or water cooled, mechanical construction of single bearing or double bearing and variety of excitations system both brushless and brush type, with class ` F ‘ or class ` H ‘ insulation, meeting the performance requirements of
national and international standards. In the aspect of dimensions, size, weight, aesthetics and performance they are comparable to the best in the world.
APPLICATIONS
Industries: Telecom, Textile, Agriculture. Military: Battle Tanks, Warships.
Utilities: Fuel Stations, Milk Dairies, Cinema Houses, Nursing Homes, Construction, Construction, Hospitals.
ORGANISATION STRUCTURE
CHAIRMAN/MANAGING DIRECTOR JOINT MANAGING DIRECTOR CORPORATE VICE PRESIDENT
ASSOCIATE VICE PRESIDENT SENIOR GENERAL MANAGER
GENERAL MANAGER DEPUTY GENERAL MANAGER
SENIOR MANAGER DEPUTY SENIOR MANAGER
MANAGER DEPUTY MANAGER ASSISTANT MANAGER SENIOR-ENGINEERS/OFFICERS ENGINEERS/OFFICERS SUPERVISORS JUNIOR MANAGEMENT-1 JUNIOR MANAGEMENT-2 JUNIOR MANAGEMENT-3
VISION, MISSION & QUALITY POLICY
VISION:
The power of now is the energy of opportunities that come to us disguised as challenges. The power of now at Kirloskar electric is the dynamics of making opportunities work as by meeting client’s tough specifications of cost and quality. Empower kirloskar electric serve the world with electric products.
MISSION:
• To remain a leading producer of electrical technology products in India.
• To continuously grow in our business and become a significant player in the world market.
• To maximise return on investment.
• To achieve international levels of excellence in technology and quality.
QUALITY POLICY
The quality policy of KSL unit-1 shall be to continually improve the effectiveness of the quality management system, conforming to ISO 9001-2000 standard in design, manufacture, market and service at competitive prices, products of such quality which results in customer satisfaction, quality reputation and market leadership.
GUIDING PRINCIPLES:
• Innovate continuously to excel in design and manufacturing.
• Develop products required by the market.
• Manufacture products of highest quality.
• Focus on the customer in all actions.
• Respond promptly to customer needs.
• Deliver supplies on time every time.
• Treat each other with trust and respect to build team.
• Develop people by training and delegation.
• Offer goods and services at competitive prices.
• Maintain safe, clean and healthy environment.
VALUES:
• Products of highest technology and quality.
• Customer orientation.
• Team work among our people.
FUNCTIONAL DEPARTMENTS
Kirloskar Electric Company Bangalore consists of various departments
Department play a vital role in the development of the company. These departments manage all operations of the company. They are as follows:
HUMAN RESOURCE DEPARTMENT
ENGINEERING DEPARTMENT
PRODUCTION DEPARTMENT
MAINTENANCE DEPARTMENT
QUALITY ASSURANCE DEPARTMENT
MARKETING DEPARTMENT
HUMAN RESOURCE DEPARTMENT
HRD functions is to satisfy the organisational needs, Selecting right persons for the right job and to manage people not only workers but also includes white collared professionals. Thus, the main objective is to maintain cordial relationship, by providing maximum welfare & thereby optimising the personal contribution for the effective functioning of the undertaking.
MAJOR FUNCTIONS
• Planning and consolidation of manpower data and projecting same to management for approval.
• Recruitment, promotion.
• Transfer.
• Welfare and industrial relationship.
• Identify the needs & conducting training & development programs.
• Rewarding employees and boosting their morale.
• Development programs for job rotation, job enrichment etc.
• Grievance handling & implementing corrective actions.
• Updating of personnel performance records as appraised by the concerned Head of the department.
• Ensuring safe working conditions for personnel at work & ensure compliance of statutory of factories Act.
KIRLOSKAR ELECTRIC CO. LTD. Recognizes its employees as the most important asset for its
continued growth…HRM in KEC shall strive to ensure continuous organisational growth by nurturing the strengths of its employees and providing the environment and opportunity for every individual to raise to his/her highest potential. Identity and achieve his/her personal goal within the framework of organisational, societal, and national objectives.
It shall endeavour to uphold the dignity of individuals, by making them feel proud partners in progress, through the following
measures:-➢ Ensure a high degree of selectivity in recruitment of employees/trainees explicitly on the criteria of their knowledge, skills and attitudes, so as to secure super achievers and nurture them to excel in there.
➢ Impart such induction, orientation and training, as to match the individual to the task and inculcate a high sense of organisational and personal goals.
➢ Provides facilities for all round growth of the individual by training in and outside the organisation, reorientation, lateral mobility and self-development through self motivation. ➢ Groom every individual to realize his potential in all facets while contributing to attain higher
organizational and personal goals.
➢ Build teams and foster team work as the primary instrument in all activities.
➢ Recognize worthy contributions in time and appropriately so as to maintain a high level of employee motivation and morale. Appraisals and promotion shall be ethical and impartial. ➢ Implement equitable, scientific and objective system of rewards, incentives and control. ➢ Contribute toward health and welfare of employees.
RECRUITMENT PROCESS/PROCEDURES
Vacancy from each department is analyzed and call is made for employment through the internet. The process of recruitment is as follows:
Interim written test
Aptitude test
General round
Analysis of technical qualification of the candidate and previous experience
Analysis of expectations of salary
ORGANISATIONAL CHART OF HUMAN RESOURCE DEPARTMENT UNIT CHIEF GM (P & IR) COMPANY SR. MANAGER (Training & Developme ASST. MANAGER (Personnel & CONSULTANT (AMBULANCE ADMINISTRAT
ION) CHIEF SECURITY
OFFICER (Security, vigilance, telephone exchange, reception & gardening) ASST. MANAGER (CORP. SAFETY) Safety & Environmental Management MANAGE R (P & IR) & FACTOR Y CIVIL ENGINE ER ON CONTRA CT APPRENTICE TRAINING MANAGER (2) WELFARE OFFICERS (2) CANTEEN & TIME OFFICER TIME OFFICE ADMINISTRATION JUNIOR SECURITY OFFICER
Total number of Employees;
Staff & Executives – 159 Workers – 434
In order to attract and retain talent, the company maintains the compensation structure on par with that of the industry. They continue to make efforts to people with an environment in which they can give their best and realize their full potential. Various hr initiatives have been taken to align the hr policies of the company with the growth projections of the
company- Receiving resumes from the candidates. Conducting interview.
Based on performance in interview, qualification, experience candidate is selected by the company.
Application for appointment to be filled by candidates.
Issue probationary engagement letter to candidate and take signature of candidate on all the copies of letters having accepted the terms and appointment conditions.
Entries to be made in appointment register and adult register. To give employee number to candidates.
Provident fund and gratuity fund application forms are to be filled by candidate. Issue of time card and brief about punching.
Issue identity badge. Obtain bank A/C number.
Induction by labour welfare officer. Sent to department head for reporting.
DAILY RATED EMPLOYEES (DRE)
Workmen category paid on daily wages basis for 26 days
Exclusive of Sundays in the month and also based on the attendance of the worker.
In KEC there 450 daily rated employees in Unit-1 in Bangalore near Govenhalli. DRE will work daily in 3
shifts- First shift; 6.30 am to 2.30 pm Second shift; 2.30 pm to 10.30 pm Night shift; 10.30 pm to 6.30 am
Production process will be going on 24 hours a day. Weekly once shifts will be changed to all the employees. In one shift 150-170 workers are working in KEC shop floor plant.
MONTHLY RATED EMPLOYEES (MRE)
They are under the management category; they get salary on monthly basis. Yearly wise they get increment based on performance and experience fixed by management in KEC.
There are 200 monthly rated employees in Unit-1 in Bangalore. MRE will work daily in one shift.
General shifts; 9.15 am to 5.15 pm
TRAINEES/APPRENTICES/GOVERNMENT/COMMERCIAL TRAINEES
The company gives only stipend and doesn’t attract any allowance to them.LEARNERS
TRAINING AND DEVELOPMENT
A fully fledged training centre provides training to senior executives, managers, supervisors and operators in the areas of management, marketing, technical, information technology, quality and general program in KEC. Specific carer development courses are conducted at training centre such as Employee re-orientation training, customer service training, promoters training, MDPs, Retraining of operators etc. Employees are encouraged to acquire technical/management qualifications through sponsorship form premier institutions within India and abroad, they may purse PG course in areas that are useful to the organisation as well as in furthering their career.
PLACEMENT:
The new entrant shall be placed under the best manager in the organisation. This implies that the manager being a role model, shall himself is a top performer, have the necessary skills in inculcating the right values and attitudes in young people. The new employees shall be placed under senior e at the executive who will act as his mentor. This mentorship process will start at the probation stage and shall continue for next 5 years.
AWARDS
Awards are instituted by the company in the recognition of outstanding work performance, useful suggestions for the improvements, and contributions to technical/academic knowledge.
PROMOTIONS
Company adopts an Accelerated Promotion Schemes for fast trackers in recognition of employee’s performance. Systematic job rotation is carried out to nurture the all round growth of the individual through lateral mobility. This will enhance employability as well as equip the person to shoulder higher responsibilities. Job rotation is based on the individual’s experience, personality, attitude, education and past performance, in addition to job related skills and knowledge. The individual will be assisted in developing new skills and have a greater appreciation of departmental and inter-unit issues, thereby removing communication barriers.
PERFORMANCE APPRAISAL
It is also known as employee appraisal, is a method by which the job performance of an employee is evaluated (generally in terms of quality, quantity, time and cost). It is a part of career development. The objective is to groom every individual to realize his potential in all facets by helping to identify and achieve his personal goals within the framework of organizational goals. This is achieved
through objective assessment of performance and potential and identification of development actions to be taken in order to enhance Appraisal consists of four stages viz… Self – appraisal, Performance assessment, Development plan, Final evaluation and grading. Generally, the aims of a scheme are:
Give feedback on performance to employees. Identify employee training needs.
Document criteria used to allocate organizational rewards.
Form a basis for personal decisions: salary increases, promotions, Disciplinary actions, etc Provide the opportunity for organizational diagnosis and development.
Facilitate communication between employee and administrator.
COUNSELING:
Counselling services are provided to enhance employees’ competence and job satisfaction, to prepare them for future responsibilities, to establish better working relationships and to cope up with
personal problems. Counselling is carried out by HRD Appraisers and professional counsellors.
CAREER PLANNING
This is to ensure that people of the right calibre are available to meet the present and future requirements of organization. The process identifies the necessity inputs aim at imparting
technical/managerial knowledge, inter-personal skills and attitudes that will helping dealing with the external and internal environments. Other factors to develop potential include activities such as exposure to new functional projects.
JOB ENRICHMENT
KEC follows a people centred approach to job enrichment with a view to enhance performance of employees, lending to higher job satisfaction. Job enrichment shall be supported through multi-skills operation, self –inspection and operator planning function.
SUCCESSION PLANNING
Every manager in KSL organization will prepare a succession plan to all position under him, identify the persons and provide required inputs to the probable successors. In order to identify the right incumbents with high potential for all positions, concerned HOD (head of the department) and unit chief shall implement the process. HR department shall co-ordinate this activity. Succession planning and career planning shall be reviewed every 6 months in the company.
ENGINEERING DEPARTMENT
INTRODUCTION
Engineering department plays a major role in giving shapes the products i.e. electric motors, generators, transformers and controllers. It is mainly concerned with designing the product according to the needs and wants of customers. Highly, technically background employees will work together to ensure maximum satisfaction to the customer. This department consists of 75 employees. They also undertake 3 comprehensive reviews of products before adding new features. Engineering department interacts usually with various departments to bring effective results to the company in the form of profits and maximize the wealth of the shareholders. The department outlays designs, drawing and sketches required by the production department and keep track of recent changes in the technology thereby diversifying the product produced by the organisation in the modern era of computation.
FUNCTIONS
• Converting customer specification into procurable, manufacturing and evaluating product specification.
• Design the product.
• Plan and arrange of raw material, manpower and other facilities required to meet schedule.
• Preparing production realization timing chart for new production development.
• Ensuring that production is completed in time.
• To reduce wastages.
RESEARCH AND DEVELOPMENT
This department gives a supporting hand for engineering department by analyzing the products with respect to materials requirement, their capabilities, uses and specific functions involved in the
research group. After research is done, product development starts and done by engineering department.
CHALLENGES IN ENGINEERING DEPARTMENT
• Coming out with positive result with lots of constraints.
• Adapting them to changing market.
• More computer oriented applications.
STAGES INVOLVED IN PROCESS OF ORDERS
• Branch or unit will receive the orders.
• Combine technical information along with commercial parameters (cost, delivery date, advance to be paid etc)
• The order will be released on customers engineering department.
• Make drawings, specification saying that specified that components should have properties.
• A document by name “BILL OF MATERIALS” will be prepared which consists of chronological order of materials along with their quantity.
• “BILL OF MATERIALS” is conveyed along with drawings, datasheets like catalogues.
• Incoming material inspection will be done by quality control department.
• Stage quality inspection will be done if material is available in house.
• After this, materials are sent to assembly shop to form finished product.
• Final inspection with respect finished products is done by quality control department again verifying customer’s wants and meeting their requirements.
• After final inspection, packing and dispatching of product is done.
• If there is any problem in the product, service department will take care.
Introduction:
Production department is the main department in any manufacturing unit as all manufacturing activities are undertaken by this department.
Production department in any industry performs the functions of converting raw materials into finished goods requires a predetermined plan so that available resources of company are used to optimum level and more wastage is reduced to the greater extent.
KEC has always tried to excel in what one knows the best. In the process of progress, KEC has laid great emphasis to use the best technology.
MANUFACTURING SYSTEM IN KECL
Based on marketing department’s requirement and other documents received by planning and material management department the production activity is undertaken. Based on the requirement of the production department the stamping division plans production activity.
KECL has production shops which are supported by:
• Feeder shop
• Tool room
• Shaft line
• Machine shop
FEEDER SHOPS:
OBJECTIVES:
To explain the various function carried out in the respective shops & organizational setup.
FUNCTIONS:
Production Delivery
Drawing of materials. Industrial relations.
Activities of tool room (shop I & II) Activities of tool crib (shop I & II) Fixing & revision of incentives (shop VI) Processing activities.
PROCESS ACTIVITIES OF SHOP I & II Machining
• Marketing • Drilling • Tapping • Burnishing • DIC-Costing • Pressing • Shrinking • Balancing • Sub-Assembly of report.
PROCESS ACTIVITIES OF SHOP VI
. Chromatin process for aluminium components. . Phosphate of mid steel components.. Premier painting . Unibake painting
PRODUCT SHOPS:
Shop III & V are product shopsOBJECTIVES:
To explain the various activities carried out in the respective shops & organizational setup.
FUNCTIONS
• Production • Delivery • Drawing of materials • Industrial relations • Interactions• Production planning & controlling (shop V) • Process activity
WORKING PROCESS:
The production dept of K.E.C. unit I is divided into six different shops. These shops are inter-connected. The central planning sets the program and then the production starts. In case of standard products some specifications are mentioned, its numbers are given to each product for identification. The last stage is the dispatching of goods when all the products are assembled & they assure the quality, they are sent to painting & then to the dispatch section.
Status of production at KEC.
Particulars % of production
Out sourcing 40% Self manufacturing 60% Total 100%
Compiled based on Personal Interview
Percentage of discount available for the company for early payment;
Days Percentage 30 2%
60 4% Immediate payment 5%
✔ The credit period of KEC is 90 days
✔ In unit one KEC is producing heavy electric motors like more then 1000 KW DC and AC motors.
➢ Raw materials are purchased based on orders from clients, For purchasing of raw materials KEC is adopted JIT technique.
PROCESS OF VENDOR SELECTION IN KEC LTD;
✔ Totally 130 Vendors of the company.✔ Vendor Development Department (VDD) performs the Vendor selection process. ✔ Steps followed in Vendor selection are:
Step 1: Identification of company requirements. Step 2: Search for the Vendors.
Step 3: Consideration of Vendor based on Infrastructure, financial status and Good will of the Vendor
Step 4: Receiving Vendor Profile (based on spare facility, financial status, his Customers, workers qualification)
Step 5: Final Selection of Vendor based on 3 Trial orders. Step 6: Vendor rating as A, B, C and feedback and training. ✔ MS-Excel is used to maintain Vendor database.
✔ Telephone and E-Mail are the mode of Communication between the company and vendors. ✔ Quality standards are fixed for each product of the vendor according to Quality Assurance department.
✔ Rejected raw materials are returned to vendor and vendor has to bare all the cost. ✔ Vendor codes are given for financial transactions.
✔ Company selects new vendors only in the following cases: ➢ In case of increase in Production.
➢ In case of new product development- where the existing vendor fails to supply required raw materials.
➢ Misunderstandings between the company and the Vendor in payments.
✔ Company finds new vendors through the people of purchase department, “Yellow Pages” and through Internet.
Risks involved in Vendor selection are:
New Supplier Risk
- In case of new suppliers, Vendor has to adjust for the Company standards.Business Ris
k - Improper supply of quality raw materials.Time Risk
- Delay in Delivery Time of raw materials. This is the main part of Purchasing. To reduce the risks involved in vendor selection, company considers few measures like Vendor’s infrastructure, good will and the employees of the vendor.Process of Negotiation:
• Company is finalizing the price for raw materials.
• Calculation of project cost and process cost which forms working cost is calculated and finalized by Costing department.
• Based on the working cost; Negotiation process is carried out.
• Vendor Development Department (VDD) is carrying the Negotiation process.
• Before receiving the raw materials, negotiation is carried out.
There are two types of payment;
Direct Payment
-For DC department-90 to 100 days is the payment period.Letter of Credit
-For AC department- 90 days is the payment period.Responsibility of Production Department:
1. Creating awareness among department personnel.
2. Identification of resource requirement & provision of adequate resource. 3. Participation in design review when necessary.
4. Implementation of storage/handling instructions. 5. In-process & final product are identified.
6. Quality assurance department will be provided information by production department for traceability of products.
7. Modification to system documents to incorporate proven corrective action. 8. Handling, storage and preservation of materials and product.
Storage
Materials at the process stages shall be stored appropriately to prevent damages & deterioration of quality.
Materials/Products/components are stored in identified locations.
Customer supplied products shall be stored along with appropriate identification taking adequate care.
Production
• The KEC has its own production plant.
• The KEC depend up on order accepting by marketing department for production.
• In KEC every month production plan is done.
• The installed capacity of KEC is 114.627 MW.
• Conversion period is 3 months.
• In KEC every month an average 300 units are manufactured
• Finished goods storage is 2 weeks (up to 4 weeks).
• Finished goods storage is 2 weeks (up to 4 weeks).
The KEC electric power has taken from Karnataka power corp. ltd worth of Rs 255.14Lk
• Direct workers cost is 1037.48 lakhs
• Indirect workers cost is 741.06 lakhs The quality control expenses are 211.67 (lakhs)
Tables shows the production overhead of KEC
(Govenhalli unit)
Particulars Costs in lakhs % of cost
Power and lighting 255.14 50% Welfare expenses 135.89 27% Other 116.74 23% Total 507.77 100TRANSPORTATION
In bound logistics
✔ In KEC for other then JIT purchase company will use the private vehicles. ✔ In KEC 95% depend on road transport for receiving and sending of the goods.
✔ Including transportation cost quotations are prepared by the KEC and suppliers are responsible for transporting the raw material to the warehouse of the company.
✔ From the warehouse to the layout of production to transport material Cranes are used which are company owned.
✔ Price will fix by based on distance, weight and type of vehicle or 5% margin. ✔ In KEC stamping materials are importing from Russia.
Major importing costs are.
• CIF price- 82.19 (in lakhs) • Customs – 3.10 (in lakhs) • Clearing charges-1.83 (in lakhs)
✔ The Other travelling charges 29.64 (in lakhs )
Out bound logistics
✔ The KEC has made contract for transport with Babu Traders and ARC (Associate Road corporation)
✔ KEC maintaining certain standard rent for sending finished goods from Govenhalli unit to Bangalore.
• Matador -900 • Canter - 1200 • Truck (lorry) – 1500
✔ In KEC most of the time customer only takes the delivery from companies dispatching unit. ✔ The customer only bares the transportation and insurance charges.
