INTRODUCTION
The main aim of organizational study is familiarization & in depth knowledge of the functioning of various departments. For this purpose a study has been carried out in Kerala Automobiles Ltd. The KAL has primary position to auto industry. For that purpose a study has been carried out in Kerala Automobiles Ltd. The KAL has a decent position in the auto industry which manufactures three wheelers with high power, fuel efficiency, strong chassis, metal body, high load carrying capacity, and with trouble free operation. The better the organization greater will be the achievement of common objective. Organization structure is an indispensible means to the end of business performance. This fact makes appropriate a thorough organization study of an industrial unit.
1.1 Objectives Of The Study
Getting organizational exposure.
To see and understand the actual working condition of an organization.
To understand the organization on the basis of departmentation.
To understand the functions of each and every departments.
To look in to the working conditions of the employees in an organization.
To learn the basic HR functions in the organization.
To make the evaluation about the performance of the organization.
To know about the organizational objective and scope.
To know the extend with which management theories matches with the practice.
To do the ‘SWOT’ analysis of the company.
To suggest recommendations for improving the overall performance of the organization.
To get clear view of the day to day functioning of the industrial establishment.1.2 Scope Of The Study
To study working environment
To study the employer-worker relationship.
To study the profit making of the organization.
How man, material, money influence on the achievement of company.
To learn the HR functions of the organization.
To learn the Industrial Relations functions in the company.
The study the study pays more attention on the process that takes place in the various departments of KAL, organizational structure and operations management of various departments of KAL.
Data sources
Data source is the source form where the data are collected and arranged. There are two kinds of sources. Primary source and secondary source.
Primary source:- Primary data are collected for the first time. It’s is obtained through the personal interview with the manager as well as some employees. Observation was systematically planned and recorded. The personal interview was direct and was a mixture of direct, structured and unstructured questions. The type observation used was structured and controlled one. The opinion of the different people may be different for a question. So, a keen observation and extraction of fact has carried out with the help of the formal authorities.
Secondary data:-These are data collected from the various journals, brochures, websites, newspaper etc. The company details and data have been personally gathered from company profile, annual report documents and other published booklets.
1.4 Duration Of The Study
The duration of study was one month starting from 3-5-2010 to 31-5-2010.
1.5 Limitations Of The Study
Time was limited for a deep study analysis of the organization.
Some personal interviews may be affected by the personal bias.
Some company documents are confidential in nature. So, it was not possible to include all those items.
Organizational environment was very busy, which limits the data collection, learning. All the information couldn’t be involved because of this factor.2.1
INDUSTRIAL PROFILE OF AUTOMOBILES
In 1769, the self propelled vehicle was a military tractor invented by French engineer and mechanic, Nicholas Joseph Cugnot. He built a steam powered tricycle that carried 4 passengers. But in 1832-39 Robert Anderson of Scotland invented the first electric carriage.
The history of the automobile begins as early as 1769, with the creation of steam-powered automobiles capable of human transport. In 1806, the first cars powered by internal combustion engines running on fuel gas appeared, which led to the introduction in 1885 of the ubiquitous modern gasoline- or petrol-fueled internal combustion engine. Cars powered by electricity briefly appeared at the turn of the 20th century but largely disappeared from commonality until the turn of the 21st century, when interest in low- and zero-emissions transportation was reignited. As such, the early history of the automobile can be divided into a number of eras based on the prevalent method of automotive propulsion during that time. Later periods were defined by trends in exterior styling and size and utility preferences.
Pioneer Inventors
German engineer Karl Benz, inventor of numerous car-related technologies, is generally regarded as the inventor of the modern automobile. The four-stroke petrol (gasoline) internal combustion engine that constitutes the most prevalent form of modern automotive propulsion is a creation of German inventor Nikolaus Otto. The similar four-stroke diesel engine was also invented by a German, Rudolf Diesel. The hydrogen fuel cell, one of the technologies hailed as a replacement for gasoline as an energy source for cars, was discovered in principle by yet another German, Christian Friedrich Schönbein, in 1838. The battery electric car owes its beginnings to Hungarian Ányos Jedlik, one of the inventors of the electric motor, and Gaston Planté, who invented the lead-acid battery in 1859.
Modern Automobile Industry
The automotive industry crisis of 2008–2010 was a part of a global financial downturn. The crisis affected European and Asian automobile manufacturers, but it was primarily felt in the American automobile manufacturing industry. The downturn also affected Canada by virtue of the Automotive Products Trade Agreement.
In 2008, with rapidly rising oil prices, industries such as the automotive industry, are experiencing a combination of pricing pressures from raw material costs and changes in consumer buying habits. The industry is also facing increasing external competition from the public transport sector, as consumers re-evaluate their private vehicle usage. Roughly half of the US's fifty-one light vehicle plants are projected to permanently close in the coming years, with the loss of another 200,000 jobs in the sector, on top of the 560,000 jobs lost this decade.
The global automotive industry is a highly diversified sector that comprises of manufacturers, suppliers, dealers, retailers, original equipment manufacturers or OEMs, aftermarket parts manufacturers, automotive engineers, motor mechanics, auto electricians, spray painters or body repairers, fuel producers, environmental and transport safety groups, and trade unions.
The automobile and automotive parts & components manufacturers constitute a
major chunk of automotive industry throughout the world. The automotive manufacturing sector consists of automobile and light truck manufacturers, motor vehicle body manufacturers, and motor vehicle parts and supplies manufacturers. This sector is engaged in manufacturing of automotives and light duty motor vehicles, motor vehicle bodies, chassis, cabs, trucks, automobile and utility trailers, buses, military vehicles, and motor vehicle gasoline engines.
The Top Automaking Nations
United States, Japan, China, Germany and South Korea are the top five automobile manufacturing nations throughout the world. The United States of America is the world's largest producer and consumer of motor vehicles and automobiles accounting for 6.6 million direct and spin-off jobs and represents nearly 10% of the $10 trillion
US economy. Automobile is one of the important industries in the world, which provides employment to 25 million people in the world.
Major Manufacturing Regions
Northeastern United States and Southern Great Lakes Region, Northwestern Europe, Western Russia and the Ukraine, and Japan are the major manufacturing regions of automotive in the world.
In North America, the prominent automotive manufacturing regions are New England, New York and the Mid-Atlantic, Central New York, Pittsburgh/Cleveland, Western Great Lakes, St. Lawrence Valley, Ohio and Eastern Indiana, Kanawha and middle Ohio Valley, St. Louis, the Southeastern region, Gulf Coast, Central Florida, and the West Coast.
The European Union has the largest automotive production regions in the World. The key automobile manufacturing regions are United Kingdom, Rhine-Ruhr River Valley, Upper Rhine - Alsace - Lorraine region, and the Po Valley in Italy.
In the Western Russian and Ukraine Region, the leading industrial regions are Moscow, the Ukraine region, the Volga region, the Urals regions, and the Kuznetsh Basin Region.
Major Segments Of Automotive Industry
Auto components amount to 31.5% share of the global automobiles and components industry group's value. The global automotive component industry is highly diverse and comprises of various product segments like engine parts, drive transmission and steering parts, suspension & braking parts, electrical parts and other auto
components parts.
Engine Parts segment in the automotive component industry comprises of different
parts like engine parts, fuel delivery system and products such as pistons, piston rings, engine valves, carburetors, and diesel-based fuel delivery systems. Engine parts form one of largest product segment of the automotive components industry and have a production share of 31%. A technology intensive segment, engine parts are moving towards improved designs for optimal fuel consumption and lesser emission. The latest trend in this sector is of outsourcing a part of the engine from vendors.
Electrical Parts segment comprises of generators, starter motors and spark plugs. An important and relatively larger product segment - engine parts are gaining popularity at a faster pace in the global automotive parts & components industry. Electric start mechanism in different scooter and motorcycles is the latest concept in the automobile industry. Electrical parts sector contribute around 9% to the auto components industry.
Drive Transmission and Steering Parts segment has sub segments like gears,
wheels, steering systems, axles, and clutches. Having 19% share, this segment is considered the largest product segment after engine parts segment. The emergence of different leading automotive manufacturers is intensifying the competition in the sector especially for products like gears and clutches
Suspension and Braking Parts segment comprises of automobile components like
brakes, brake assemblies, leaf springs, shock absorbers, brake linings. Suspension and braking parts segment has around 12% share in the global auto component industry.
Body and Chassis Parts segment comprises of body and chassis, sheet metal components, and plastic-molded parts. The global sourcing of automotive components comprise of chassis, frames, brakes, steering and much more has reached to US $ 185 billion in 2008-09. This product segment has 12% share in the global automotive component and parts industry.
Market Forecasts
Global Auto Components Forecast Value USD billion 2004 -2009
Year USD billion % Growth
2004 515.5 2.30 2005 526.2 2.10 2006 538.9 2.40 2007 553.4 2.70 2008 569.1 2.80 2009 585.9 3.00 CAGR 2004 - 2009 : 2.6%
It is not only the cars, consumer vehicles and two wheelers that are sold in these various countries in large numbers, but the three wheeler market is also quite big in these nations. You will get to see innumerable three wheelers running on the roads of various Southeast Asian countries like India, Thailand, Sri Lanka, Pakistan, Philippines, Nepal, and Bangladesh etc.
There are a number of reasons that have resulted into the proliferation of the three wheelers in umpteen countries. Three wheelers are quite economical in terms of manufacturing and maintenance. They have also earned huge popularity due to their easy maneuvering capabilities through the narrow lanes that are prevalent in most of the developing countries.It is not that three wheelers are used only in the developing nations.
Three Wheeler Companies
You will also get to see various brands of three wheeler in different parts of US, UK and some of the European nations. Reliant and Morgan Motor Company are the two major three wheeler manufacturers in UK. One of the US based three wheeler manufacturers; ZAP has even come up with eco-friendly three wheelers that operate with battery. Bajaj Auto, Piaggio is the leading players in the three wheeler industry in most of the Southeast Asian nations.
The vehicles have also given rise to the three wheeler accessory industry in many countries. It is believed that numerous people have got employed in various countries due to these three wheelers. Apart from serving the daily need of the commuters the three wheelers also play commendable role in the transportation of several commodities. Seeking the increasing demand of three wheelers, more automobile companies are considering manufacturing these vehicles.
INDIAN AUTOMOBILE INDUSTRY
The automobile industry in India is the ninth largest in the world with an annual production of over 2.3 million units in 2008. In 2009, India emerged as Asia's fourth largest exporter of automobiles, behind Japan, South Korea and Thailand.
Following economic liberalization in India in 1991, the Indian automotive industry has demonstrated sustained growth as a result of increased competitiveness and
Maruti Suzuki and Mahindra and Mahindra, expanded their domestic and international operations. India's robust economic growth led to the further expansion of its domestic automobile market which attracted significant India-specific investment by multinational automobile manufacturers. In February 2009, monthly sales of passenger cars in India exceeded 100,000 units.
Embryonic automotive industry emerged in India in the 1940s. Following the independence, in 1947, the Government of India and the private sector launched efforts to create an automotive component manufacturing industry to supply to the automobile industry. However, the growth was relatively slow in the 1950s and 1960s due to nationalization and the license raj which hampered the Indian private sector. After 1970, the automotive industry started to grow, but the growth was mainly driven by tractors, commercial vehicles and scooters. Cars were still a major luxury. Japanese manufacturers entered the Indian market ultimately leading to the establishment of Maruti Udyog. A number of foreign firms initiated joint ventures with Indian companies.
In the 1980s, a number of Japanese manufacturers launched joint-ventures for building motorcycles and light commercial-vehicles. It was at this time that the Indian government chose Suzuki for its joint-venture to manufacture small cars. Following the economic liberalization in 1991 and the gradual weakening of the license raj, a number of Indian and multi-national car companies launched operations. Since then, automotive component and automobile manufacturing growth has accelerated to meet domestic and export demands
2.2 COMPANY PROFILE
Kerala Automobiles Limited (KAL) incorporated in 1978 as a Government of
Kerala undertaking, is set up in the picturesque back drop, 16 kilometers south of Thiruvananthapuram in a tiny village called Aralumoodu, in Neyyattinkara taluk. The Company manufactures Three Wheelers (Diesel, Petrol & CNG) suitable for passengers and goods traffic in the brand name of KERALA and are considered as most Eco-friendly vehicles.
KAL started production with 164 employees where capacity of production was 52 vehicles per year. Initial technology of production was in collaboration with API Mumbai and from 1987 it has developed its own tehnology of production.
KAl staretd with a production of petrol engine three wheelers from 1988 it began to produce ‘diesel engine’ three wheelers.KAL is the first company to introduce diesel engine three wheelers in the country.At present company is concentrating in the diesel
versions only.
The present product range comprises of Autorickshaw (Three/Six seater), Pickup/ Delivery Van, Three Wheeler Tipper of Diesel version and Pollution free CNG fitted Auto and Load carriers etc. The strong, highly motivated work force in the Technical and Management cadres are working hand in hand for the progress of the Company. The ancillary units developed by the Company around the factory complex provide livelihood for hundreds of families.
Since commencement of production in 1984, the Company has manufactured and marketed more than 1,20,000 Three Wheelers. KAL has distinguished itself as a force worth reckoning in the Automobile industry in India. The Company has also exported a number of Three Wheelers to Bangladesh, Sri Lanka, Nepal, Sudan, Botswana, Nigeria, South Africa,Egypt and Guatemala (Central America). The Company could turn the corner for the first time in 1993-94 and continued to keep the same trend at a higher level. The acceptability of KAL Three Wheelers in the Third World countries speaks for its utility and quality. KAL is also manufacturing sophisticated components to be used in space programs of VSSC/ISRO.The company has the capacity to produce nearly 7500 vehicles per year.
The Company is getting all kind of support from the Government of Kerala, without which it would not have been possible to achieve the present level of promising state of affairs. KAL is awarded with ISO 9001:2000 Certification envisaging total quality management (TQM). It is the unflinching faith of our customers, which has powered
KAL into the path of progress and looking forward for continued patronage at a higher
rank.
Date of incorporation: 15th March 1978 Address & registration: Athiyanoor,
Aralumoodu,
Thiruvananthapuram-(dist),PIN:695123
Phone & website: 2222640, www.keralaautomobilesltd.com Name of chairman: Divakaran
Name of MD: K P Vijayakumar
Vision
“To become top three wheeler manufacturer in 10 years.”
Mission
“To provide value added service and product to the customers and to earn reasonable profit.”
Quality Policy
The management and employee are committed to develop, manufacture, market and service three wheelers enhancing customer satisfaction through a process of continual improvement of its quality management style.
Products
1) Kerala GL 400 V2 electric start chassis- Rs 76,000 2) Kerala GL 400 V2 rope start chassis – Rs 74,000
3) Kerala Gl 400 V2 MX 400 electric start chassis- Rs 83,000 4) Kerala GL 400 V2 rope start - Rs 77,000
New products
1) Self start (340cc) petrol engine [CNG] 2) Self start (340cc) gas engine
2.3 ORGANISATIONAL CHART
The board of directors manages the affairs of company. The government
of Kerala determines the members of the board.The members are
determined by the government in a conservative way. The number shall
not be less than two and not more than nine. The government appoints the
director including the full time directors.The directors need not hold
shares. They frame policies requires for the company to achieve its goals.
The managing director will execute the affairs of company through the
managers in different departments. It consists of
I.
Chairman
II.
Managing directors
III.
A nominee from finance department
IV.
A nominee from industries department
V.
A nominee from the government
The MD is always responsible for the conduct of managers of the
company subject to overall control and supervision by board of directors.
The general shall be in charge of company where MD is not present. In
such cases, he or she shall take decision on financial matters in
consultation with financial controllers.
ORGANISATIONAL STRUCTURE
MANAGING DIRECTOR
DEPT .GENERAL
CHAIRMAN
MANAGER
ASSISTANT MANAGER
SENIOR ENGINEER
SALES EXECUTIVE
JUNIOR ENGINEER
WORKERS
COMPUTER PROGRAMER
Jr. Pe rso nn el Ofce r on ers t.P Ass ne l Ofce r BO D N MA AIR CH MD Sto re de pt PD N d ep t Mkt de pt H.R de pt Plan g d ep t QA d ep t R& D de pt Pu rc de pt Main tan ce Ad min ist rat io n GM M Manag er Ass t MGR Manag er Manag er Manag er Sr. En gg GM F Manag er Manag er Ass t MGR TR .E xe cuti ve Ass t MGR Sr. En gg Jr. En gg Sr. En gg Ass t MGR Sr. Ofce r Su pp lie r De vlo p Ass t.Mg r Pu rch ase Sr. E ngg Subc ontra ct TR .E xe cuti ve Se rv ice &S pa r M/C S ho p FA BR I AS SE MBLY TOOL R OOM HE AT TR EA PA IN TIN G Ass t. MGR En gin ee r Wor kme n Sr. E ng in ee r r ee in ng E Jr. Jr. E ng in ee r n kme Wor Wor kme n Jr. E ng in ee r Sr. E ng in ee r Wor kme n Jr. E ng in ee r Wor kme n Wor kme n Jr. E ng in ee r Sr. E ng in ee r2.4 PRODUCT PROFILE
Petrol models
P1 petrol autorishaw, regular three seater (1984) P2 Newlook Autorishaw (1988)
P3 petrol delivary van (1984) P4 petrol pickup van (1984)
P5 petrol three wheeler chassis (1985) Diesel models
D1 Diesel pick up van (1984) D2 Diesel auto trailors (1988)
D3 Diesel chassis come under three models 1. 4360 Chassis- Self start
2. 4325 Shorter rope start D5 Kerala MX 4000
D6 LGA 340 (ELECTRIC START) Current moving products
Kerala MX 4000
ANALYSIS OF DEPARTMENTS AND WORKING
There are approximately 20 departments in KAL.The size of the department depends on the importance and complexity of the function of department. The various
departments of KAL are as follows: 1) Human Resources Department 2) Administrative department 3) Sub-contract department
4) Research and development department 5) Purchase department
6) Finance department 7) Marketing department 8) Production department 9) Planning department 10) Machine shop department 11) Quality assurance department 12) Stores department
13) Maintenance department 14) Service and spare parts
3.1
HUMAN RESOURCE DEPARTMENT
Department structure HR DEPARTMENT MANAGER Asst. MANAGER Jr. PERSONNEL OFFICER Asst. PERSONNEL OFFICERObjectives
Reduce absenteeism from 10% to 5% in the course of one year.
Improve employee satisfaction by 10% using a survey of current situation at the end of one year.
To enable individual employee to improve their efficiency by 5% in the course of 1 year.Manpower planning
The number of employees in an organization is decided by the number of products delivering.The Government decides the number of employees to be worked for the company to achieve the targeted production It is called Employee Sanction
Strength.
The capacity of the plant is 7200 units/year.i.e, 600 per month. Number of workers needed to make 1 vehicle is 20 workers per day. Employee sanction strength= 20*(600/25)=480 workers.
The current sanction strength of employees of KAL is 495(shop floor wokers + managerial category)
But since the current production rate is set as 300 units per month, the employee strength is maintained as 250-260.
A problem that KAL facing : The 1/3rd of employees in the company are unskilled workers, who were inducted at the beginning of the ompany.
Recruitement is a very carefull process to be done. Otherwise it will make unnecessary losses in future.
Current manpower planning: the number of contract employees are checked based up on the production.The work is being outsourced to the outside parties, if there arises an immediate shortage.After getting the preffered output of production,the machinery is used for the manufacturing of other products like coir spinning machines etc.
Recruitment and selection
There are three methods of recruitment 1) Direct Recruitment
2) Employment exchange 3) Public Service Commission
1) Direct Recruitment: Direct recruitment is done through advertisement in newspaper.
2) Public Service Commission: The post of helpers, typist, office assistants, stenos, clerical staff, drivers etc are done through PSC. Whenever there arise a need for employees on such posts, it will be reported to PSC. But there is no such recruitment in recent times since there is no need for such posts.
3) Employment exchange: This is done through the employment exchanges. This is because of the Compulsory Notification act. The required number of candidates and their qualifications are informed at the employment exchanges. The eligible candidates are recruited and selected.
4)For higher posts, there will be interview only. In the interview board, there will be members from board of directors, HR manager and the domain/subject expert sometimes as per the direction from the government. Then the merit list is published .Then fixed list is published for selected candidates.
Selection procedure
The first step to selection is written test, applicable to all category of workmen. An interview is conducted for those who succeed in it. Applicants to technical post undergo a trade test also.
Apprentices: Apprentices are selected from three sources.
Related Instruction Centre(RIC) - To recruit ITI candidates
VHSE board
Central Apprentice - For graduation & B.Tech (office is at Chennai)
Diploma holders are selected through supervisory development centre kalamassery.An induction program will be given to all the candidates who join the KAL as a fresher. They will be provided on the job training. Most of the time, their probation period will be from six months to one year. After that, if the candidate’s performance is satisfactory, he will be appointed as permanent.
Training and Development
After the intake of a permanent employee, he will be given training for 1 year. Permanent appointment is given after that. The training can be inside or outside the organization. During the period of training, the basic pay alone is given. After appointing the employee as permanent, he will be paid salary with all the kind of benefits.
Apprentices and management trainees are appointed based on contract basis to get trained in their domain areas. They will be given stipend only.
Employee Profile
Workmen re classified in to permanent workers, probationary, temporary and casual workers. At present there are 255 permanent employees.
Employees can be classified based up on two norms, they are: 1) Based up on Standing order
2) Based up on wages of employees/wage settlement.
In KAL the employees are classified up on wage segment. They are
Officer category/managerial
Technical category/workmenIn KAL, the employees are classified in to two categories based on wage settlement. They are :
1) Officer/managerial 2) Technical/Workmen
The detailed categorization is given in the pay scale structure below Number of employees in various departments
Employees Sub-contract department 2 - -Marketing 8 - 2 Maintenance 11 - 3 Store 15 - 3 Quality Assurance 18 - 4 Heat Treatment 2 - -Tool Room - - -Painting 9 - 3 Assembly 26 - 9 Fabrication 30 - 8 Machine Shop 55 3 19 Planning 5 - 1
Design & Drawing 7 2 4
Service & Spares 8
-Administration 14 - -HRD 15 3 2 Purchase 12 1 3 Accounts 15 2 2 General 4 - -TOTAL 254 11 63 Working time
The working time in KAL is 8 hours per day. There are maximum 5 shifts in the company.
(1) Executives : 9 am – 5 pm
(2) Ministerial staff: 9.30 am – 5 pm (3) Workmen : 9 am-5pm (general shift)
6 am – 2 pm (1st shift) 2 pm – 10 pm (2nd shift)
Attendance
The attendance of KAL is calculated through the punching system. The employees punch their attendance card and the attendance will be registered in the server. The salary is calculated based on this. For every minute late, the belated time will be calculated and respective salary will deduct and causes ‘loss of pay’. Such
exception is only for the entry time of first 30 minutes. If the employee is late more than 30 minutes, he has to take half day leave.
Wages and salary administration
There are two scale of pay. They are: 1) For officer segment( every 4 year revision) 2) For workmen segment( every 5 year revision)
Stipend
The trainees & apprentices are given stipend every month. Its as follows.
ITI - Rs 1440
Diploma - Rs 1850
Degree - Rs 2600
Management trainee - Rs 3000SALARY RELATED TERMS
Dearness allowance(DA)
There are two type of DA.
1) Fixed DA /Government DA:
This is for the people of the managerial category. Fixed DA varies every quarter. The current government DA is 123% of the basic scale of pay. This DA is fixed by the government and is based on the salary point scale. It is as follows: Fixed DA = (basic ×123) /100
2) Variable DA:
This DA is for workmen category. This is fixed by the government based on Cost of Living Index/ Consumer Price Index (CLI/CPI). ‘Economic and Statistics Department’ (Trivandrum, www.ecostat.kerala.gov.in) prepares Consumer Price Index. This DA percentage varies according to the inflation every month.
To calculate Variable DA the following are necessary.
1 Base Point: It is determined at pay revision and it varies at every pay revision. The current base point of KAL is 950.
2 Indices : It is the cost of living index of the month as in CLI 3 Points for each scale of pay. It is as follows:
Basic pay scale Points
Up to Rs 2950 3.95
Rs 2950-3500 4.20
Rs 3500-4001 4.75
Above Rs 4001 4.90
Steps to calculate VDA
Index of month(CLI) – Base point = Result Point × Result = VDA of the month
Example:
Base Point of KAL = 950
CLI (of February 2010 is) = 1839
Result = 1839-950 = 889
VDA of a work man having basic Rs 2950 = 889 × 3.95 = 3511.55 Rs VDA of a work man having basic Rs 2950 upto 3500 = 889 × 4.20
=3733.8
About base point: Every pay revision, the base point is merged to the basic. Here the base point is 950 and is already merged in the basic and the extra money coming is calculated by subtracting 950 from CLI. In the next pay revision, the authorities will decide up to what amount should be merged to the basic.
House Rent Allowance(HRA)
This is decided by the management with the understanding of labour unions. This is revised every 5 years and further change in HRA is made.The current DA rate are
Work men : Rs 350 Officer category : Rs 260
Adhoc pay
This is give to thoe employees who are eligible for promotion and not promoted yet even after the time bound within which they have to be promoted. When adhoc pay is added to the salary, the respective DA of adhoc pay is also given to the employee. That is adhoc pay is added to the basic salary and its DA is calculated. When he got promoted, the adhoc pay is removed and the new scale of pay to the promoted position will be given.
Attendance bonus
If the employee takes only one leave in the month of 26/27 working days, he will be eligible for Rs 25 attendance bonus.But if there are two leaves or ‘loss of pay’, he won’t be eligible for the attendance bonus.
Gratuity
The employee will get 15 days’ salary as gratuity for one year’s work. The employee will eligible to receive gratuity, when he completes minimum 5 years service. As per gratuity act, in KAL while in service if any employee passes away, he will get full gratuity amount up to his retirement age.
The base for calculating PF is 26 (working days a month).The amount used to calculate gratuity is the ‘basic pay +DA(if exists)’.
Gratuity=15 day’s salary= [(basic+DA)/26] × 15
(This is equal to the 4.8% of annual salary[basic + DA(if exists)])
Gratuity amount at a particular year of service =
*- Number of years of service : More than 6 months service will be counted as full year of service.
i.e; 1 year 7 months will be counted as 2 years.
Incentives
Incentive is given to all the employees from top to bottom of the organization, when extra production takes place. But since the current production is limited, there is no incentive the employees.
Production (vehicles) Amount
300-325 Rs 2.00
326-350 Rs 2.50
351-510 Rs 3.00
Above 511 Rs 4.00
Washing allowance: Rs 30 per month is given to work men as washing allowance. Stitching allowance: Rs 250 per year is given to workmen those who have uniform and Rs 35 for women.
Risk allowance: Rs 50 per month is given to work assistants and helpers who undertake operations like painting, heat treatment, ammonia pointing welding etc. Special allowance: Rs 25 per month to senior tradesman.
Shift allowance: First shift – Rs.2.50
Second shift – Rs 3
Shoe allowance: Administrative department provides Rs 300 as shoe allowance in every 8 months to every employee.
Provident Fund (as per PF act 1952)
12% of the salary (Basic + DA) is paid to Provident Fund account from the salary of the employee. The same amount will be provided by the employer to the PF account. The 12 % of both employee and employer is statutory. But the employee can voluntarily pay additional amount more than 12% to the PF account. But the employer don’t have to pay accordingly as the employee pays, other than employer’s
Around 8.33% of the 12% of PF share of the employer will go to the Pension fund of the employee.
The interest of the Provident Fund is 8%.
An employee can take money(as loan having no interest) from PF account(employee share) twice in an year. He can also take money for education, marriage(up to 60%), home construction(up to 90%) etc. The proof of such things should be provided such as building plan, approval from authorities, engineer etc for construction, marriage certificate copy, invitation etc for marriage after the function and statement from bank etc for education. The employee may or may not repay the amount taken from the PF account (as loan).Generally there is no need to pay back the money. This loan amount is permitted from the employees share of 12% of basic salary that he pays every month. The employee cannot take money from the 12% of the employer’s share to PF.
The account section pays the PF in the bank with the ‘common PF account number’ of the company and gives the chellan to HR section. The company has its own single PF account number as whole for all the employees.Each and every individual employee has their own personal PF account numbers. The HR department prepare the list of employees with their individual PF account numbers and sends it to the PF office along with the chellan.
If the monthly PF of an employee is not paid by the company, the MD of the company may get imprisonment.
Leave
Casual leaves - 20
Medical leave - 10 full day leave/20 half day leave
Earned leave/annual leave : The employees have the right to take 1 earned leave for every 20 working days(20:1)(based on factories act). But the management has the right to put forward attractive plans in front of the employees to motivate them. Earned leave can be encashed. The maximum number of earned leaves that can be encashed are 300 days.
In KAL the earned leave ratio is as: Managerial category - 11:1
Holidays
KAL follows a systematic method for deciding holidays in an year. There can be up to 13 holidays in an year. Out of these 4 days are national holidays-jan26, may1, aug15, oct2.The remaining festival holidays are decided by the management and workers committee.
Total number of leaves in an year
Annual - 30 Casual - 20 Medical - 10 Holidays - 13 Week Sundays - 52 ________________________
TOTAL LEAVES- 125 /year. Promotion opportunities and appraisal Promotional policy
50% recruitment is through direct method and the rest id through promotion. The promotional levels are:
Technical
Engineer, Senior engineer, Ass.manager,manager, Deputy general manager, general manager.
Nontechnical
(1) Accountant, junior personnel officer, junior law officer, superintendant, sales executive.
(2) Ass.accountant officer, Assistant administrative officer, Ass.personnel officer, Ass.welfare officer.
(3) Account officer, Personnel officer, administrative officer etc
In KAL promotion is based on
Seniority
Qualification
PerformanceIf a person won’t get promotion till 10 years due to lack of qualification, poor performance etc he will be given a grade. It is called upgradation.
Difference between up gradation and promotion:
The upgraded person will get salary hike only. He won’t be given authority according to the salary increment. But in the case of promotion, the employee have both salary hike and authority.
Performance appraisal policy
It should be in prescribed form.
The performance appraisal shall be conducted annually in the case of workmen. In the case of supervisors and above, the appraisal shall be conducted half yearly during the period from January to june and july to December.
The entries in the performance appraisal form shall be clear and precise and shall be based on the officer’s personal observation of the work and conduct of workmen.
The entries shall be made by the officer in his own hand or type written by him and shall be kept confidential ad the report shall be under the safe custody of the personnel department.
If there are any adverse of such nature that the workmen needs an advice or admonition only, the concerned Head of Department shall render such advice of admonition. In more serious cases, the head of department shall give opportunity to the concerned to submit explanation. The intimation to the workman together with his reply, if any, shall be kept in the personal file.
The confidential record shall be prepared by the officer under whom an employee is working and shall be submitted to the head of the department who shall countersign it, adding his own remarks, if any.
Performance appraisal process
job responsibility, quality of work, cost consciousness, organizing ability, punctuality, problem solving ability etc. Performance appraisal goes through the steps as follows: (First appraisal by employee, then appraisal by the rater (immediate next head) and reviewed by the head of the department. Calculation of appraisal score of employee done based on five point rating system. The final rating is done by the rater. Counseling is also given for low level performers).
Steps
Issue performance appraisal form to employees.
Self appraisal by the employee.
Appraisal by the rater.
Review by the rater.
Review by Department head. Calculation and appraisal score of each employee in personal interviews.
Counsel employees for improving performance.
The five point rating method is used for performance appraisal. Grading are given below in two tables. Five point rating method is used:
Grade A B C D E
Performance Excellent Very good
good average Poor
Point 90-100 70-89 50-69 30-49 10-29
Disciplinary procedure
Discipline is a watch word maintained in KAL. Disciplinary actions are strictly followed. There has not any instances of dismissed at KAL till date. As usual, the worker is given a show cause notice and a time limit is given to produce his explanation. If the explanation is satisfactory, no further action will be taken. But if it is not satisfactory, he will be given a charge sheet and thereafter enquiry. A workman can be suspended for enquiry. He will be paid a subsistence allowance according to the kerala payment subsistence act 1972. If the explanation is convincing, then the suspension is withdrawn and wages for the period of suspension will be paid in full. If no explanation is received, the management may proceed with action.
Enquiry may be held by enquiry officers appointed by the higher authorities. Enquiry officers will make recordings and forward it to the concerned authority. Then
charge sheet and the recordings of the enquiry will be given to the concerned authority and the decision is communicated to the workman. If the charges are proved by the enquiry action will be taken, if not the worker will be called on duty and his wages for the suspended period will be paid in full.
Grievance procedure
The company has an open door policy as far as grievance handling is concerned. Workmen are true to take their grievance to their superior authority and seek a redressal. The usual procedure for handling of grievances is given below: (1) Grievance report to immediate supervisor.
(2) If workman is not satisfied/ not receive reply within 7 days he can go to next immediate supervisor.
(3) If that decision is not satisfactory/ doesn’t receive reply with in 7 days, he can send the grievance to the head of department in written with signature.
(4) If the decision of head department is unsatisfactory/ doesn’t receive reply with in 7 days he can present a copy of grievance not to the Head of HRD department who will make necessary entries to grievance register. He will then conduct investigation of all relevant facts and endeavor to settle the grievance satisfactorily shall be final. The head of HRD department will implement the final decision if any and will inform the response in writing.
Industrial Relations
According to the referendum, the union having 15% membership will only be recognized. Now in KAL there are 3 unions.
Name of union Reg. No. Affiliation
Kerala Automobiles Limited Employees Union
126/82 INTUC Kerala Automobiles Employees Organization 102/84 STU(Swathanthra Thozhilali Union) Kerala Automobiles Employees Association 325/84 CITU
From the discussion with HR manager
Now there are 257 permanent employees in KAL
As a part of product diversification, coir spinning machine is made and handed over as per demand. By providing training, the management is trying to impart a change in the work culture. The work culture that KAL follows is a traditional one. It needs to accept the change according to market and time as the other public sector companies are also changing.
In Department Performance Appraisal (DPC), HRD department has the plan to implement a written test for the officer category. But due to the opposition from the side of employees, it became unsuccessful.
Absenteeism: For lateness, the proportional amount of salary will be reduced. A regular attendance is kept. There is a time keeper to make sure that employees are on time. He is responsible and checks the duties on time.
Situation analysis is a must for a HR manager. One has to stay calm and listen to the problem/issue first. HR has to stand independent in taking the decisions, with out any biases
Exit interview: Usually there is no exit interviews done in KAL at the time of retirement.
3.2 ADMINISTRATION DEPARTMENT
DEPARTMENT STRUCTURE
The main functions of administration department are as follows: Committees
The committees in KAL are formed by the unions elected each year. Each union nominate one person to each committee. Equal number of persons from the side of labour unions will be nominated from the management side. The committees in KAL are canteen committee, safety committee, magazine committee, estate committee, scrap committee.
Committees are under administration department. Election is also carried out by administration department. The union which wins election undertakes club and society. Usually the election is carried out in 3 years.
Labour welfare committee: It provides Rs 62,000 to family on death of personnel. It is by aggregating the salary of 1% of employee plus 1% by the management. It gives awards to the children who tops in exams like SSLC, B.Tech, +2 etc. The price money varies as Rs 1000, Rs 750, Rs 500.
Punching card and ID card are issued by the administration department. In turn, an
MANAGING DIRECTOR
ADMINISTRATIONMANAGER
JUNIOR EXECUTIVE
Security: Managing the security people is done by the administration department.
Fresh quotation is invited every year for the security people. ‘Ex- service league’, an association of ex-service men carries out security job nowadays.
Total number of security = 18
Supervisor salary - Rs 200(improved from Rs 160) Security Guard - Rs 160 (improved from Rs125)
Uniform for the workmen are issued by the administration department- Pista green shirt and black trousers for men and Pista green saree and black blouse for women. Stitching allowance of Rs 250 is given for men and Rs. 100 for women. Canteen: every year new quotation invited in dailies like malayala manorama,
mathrubbhumui, kerala kaumudi etc to undertake canteen. Canteen committee votes and selects the best quotation. Management given Rs 300 subsidy for each employee every month. Coupon is given to employees for food. Water, building, utensils etc are free for canteen undertakers. There is a ration permit of 3500 Kg rise and 2000kg sugar for KAL canteen.
Stationery: administration department buys and stores he stationery items like
calculator, files, glue, paper, pen etc. In every 2-3 months it is bough wholesale from Triveni shop, for an amount up to Rs 40,000. It is supplied to each respective department as per the need and it makes sure that the items are not manipulated. Letter dispatch: Every outgoing letter is sent via administrative department.
There is a machine called ‘Franking Machine’ to seal the letters, which is issued from the postal department. The parcel weight is measured and the respective stamp rates are printed.
Advertisement: Some organizations demands for advertisement as promotion for
programs, in magazines, diaries etc. The photos that are advertised is brought to the organization, and then only the money is paid. To print the KAL diary, administration department approaches different firms for advertisement to reduce cost. It has a long time regular advertisement providers.
Furniture: It is bought and supplied by the administrative department. The repair
work is also done by this department.
Retirement: Administration department arranges a send off function in the
portico on the day of retirement of an employee. The company car is arranged to take him home. He will be given a gift and a party will be arranged.
Funeral arrangement: In the case of demise of an employee, Rs 5000 will be
given to the family to carry out funeral function. Rs 3000 will be given to the close relative of the died person.
Garden: the garden is maintained by the administration department.
Head load workers: The wage of head load workers is paid by the administration
department.
License Renewal: It’s the job of the administration department to renew the
license of company every year. If the license is not renewed, the company cannot work. The industrial license application is given in the form-2. It is according to the rules – 4 , 12. The application for renewal is sent along with the duly filled in ‘form-2’ and the chellan of Rs. 75,000 and the names and details of Board of Directors. Original factories license will also be sent along with this and it is renewed and a new license is issued back to the company. The license is renewed from :
“The inspector of Factories and boilers
Grade-2 , near vanchiyur police station, Thiruvananthapuram”
Supplier
developmen
t
PURCHASE DEPARTMENTObjectives:- Satisfy the supplier by giving regular order Reduction in rate of rejection in materials Vendor rating up graduation
The main function of the purchase department is to purchase the raw materials which are necessary for the production process.
The products purchased are divided in to 5 divisions – A,B,C,D,E. Product type A: includes – tyre, engine, tube, sheet etc
Product type B : includes – upper cone, horn, speedometer, cable for gear control, heel cylinder assy, brake lever assy, mango lever, spring etc.
Product type C : includes – shaft with support, clip cables, shim adjusters, petrol tank neck, rear break adjuster, spacer for head lamp, cable for clutch, support bracket, rivet, wiper fitting, screw etc.
Product type D : includes – div. beeding, overflow pipe, speedometer cable, ignition switch, decompression cable, main electrical loom, DC horn, battery
Manager (materials)
Assistant manager Senior engineer Junior engineer
Attender Clerical staf
cable assy, BULB – B 53, tail lamp assy, reflex reflector, indicator (green), silencer mountings, stop bush spring.
Product type E : includes – sheet (MICA/PVC), tape (cotton), paint(INC golden, yellow) , primer, putty, thinner, rubbing compound, polish wax, seal 101 chemi, react chemi, additives, welding glass, button mop, emergency powder.
Purchase cycle
Calls quotation
Negotiation
Checks quality
Purchase development
Purchase department ensures the availability of right material at right tie at right place at the right quantity. The department is under the control of purchase manager. All the activities regarding purchase are under gone in this department. This department is responsible the procurement of raw, materials. Its supply and service the raw materials and purchase parts in the finished goods must be the information from the marketing
department, planning department prepare the sales plan and send the production plan & material plan to the purchase department Based that requirement. The department purchases both raw materials and semi finished goods. Prepare the purchase order and then it scheduled to making purpose. Then give the order the company purchase mainly from Haryana, Uttar Pradesh and almost 25% is form Mumbai. The purchase of materials from vendors and they rate vendors and evaluate them on the basis of parameters like quality, price, time. The department is following ABC analysis for purchasing of products. They do have a PDCA cycle of doing things.
ABCDE analysis is used to follow for the purchase. The order that is placed for ‘A’ category is before the week, for ‘B’ before one month and for ‘C’ items. The order is placed before six months. The responsibility for ‘A’ quality is with materials manager, ‘B’ quality with Asst. Manager and ‘C’ is with Asst. Engineer (purchase). There is a purchase committee formed for the purpose of bulk purchase of products. This department also uses vendor rating and vendor evaluation techniques. If the rating of the vendor ‘C’ grade they will encourage the vendor to promote to ‘B’ grade. Of they are not living up to their expectation. The company will delete the vendor names from the vendor list.
The company purchasing more than 2200 components for a single product. The categories into A,B, C, D, E and subcontract.
Most of the suppliers are from outside of the state. Mode of transmission is by truck or railway or airways, based on the time and need. Some of the main transportation agencies in the company are Kerala Transport Corporation. Sourashtra Roadways, ABT purchase etc. If the mode of transportation is through truck then thee consigner(vendor) give the consigner copy (CC) of the lorry receipt(LR) to the consignee forwards the CC of Ir to the agency and collects the goods. If the transportation is through railway then the documents in Rail receipt and for airways it is always bill.
The Procedure for a purchase Enquiry for question Receive the quotation Negotiation of the quotation Revise the quotation
Proposal for the purchase Place purchase order Follow up the material Collect the material Quality inspection
Raising GNR or GRJ (Good receipt note/Goods rejection note Payment to vendors
Payment for vendors is in 3 ways
Direct Credit – forwarding original GRN & invoice to the accounts department for the payment, usually within 30days.
Direct advance - against Performa invoice
Through bank – the vendor will sent the original invoice and CC to Lr to purchaser’s short bank. The bank sent BLSC (Bank Letter for Short Credit) After the payment, the bank will forward the Lr documents & invoice to the purchaser.
There is a purchase committee. It includes DGM, production, manager-purchase and one member from accounts section.
Local purchase: Small and the products of urgent shortage are brought locally by paying money instantly. This is to avoid production held-up.
The purchase up to 15000 is controlled by the manager
Between 15000-100000, by the purchase committee
Above 100000 controlled by MD with recommendation of purchase committee through GM
List of the purchase
schedule:- Register for the copy of invoice LR forwarding register
Comparative study
Procurement data analysis Purchase order
Enquiry notice
Annual purchase plan List of approval suppliers Bank document
GRN receipt
Supplier rating document
Supplier satisfaction is one of the main aims of the department. The department keeps good relation with the suppliers and pays money on time. It also makes sure that the products purchased are of good quality and keep motivating the suppliers to provide
SUPPLIER DEVELOPEMENY SECTION
The section finds out the goods and fair source of supply. Procedure for supplier
development:-This section looks for the potential source of suppliers by referring the journals, attending exhibitions, seminar and trade fair. After making contract with suppliers, the section will prepare a supplier list form. Applications are received from the supplier and the committee evaluates and selects the good one. After the section a written letter will be sent to the approval supplier for the issue of required raw materials. The department is responsible to keep the supplier list and approval records. Performance of every supplier in the approval list will be reversal once in every six months.
Functions:- They act for the development of existing suppliers and identify their problem, then come out with good solution.
Develop fresh parties for their requisition by R&D department Identify quality supplier from
SUB- CONTRACT DEPARTMENT
DEPARTMENT STRUCTURE
In KAL many of the terms such as differential cage, axel, shaft etc are sub contracted from outside.
This department has the same function as the purchase department. In this department the details regarding outsourcing products or materials are stored and updated. This department is functioning under the purchase manager. Sub Contracting materials are given inside and outside Kerala for work. Materials manager is in contract of sub contract department.
Objectives:- Supplier Satisfaction
To reduce rejection in sub contract items of differential cage from 10% to 20%
To reduce rejection of axel, shaft from 20% to 2%. The sub contract department follows PDCA cycle in this activity.
Main Sub Contract areas are:
Cluster gear, main gear with bush, hand chassis etc. Activities: MATERIALS MANAGER SENIOR ENGINEER ENGINEER CLERICAL STAFF JUNIOR ENGINEER
Receive production plan from planning department Make purchase enquiry
Invite quotations
Prepare comparative statements Send negotiation letter
Receive negotiation letter from vendors Prepare work order proposals.
Proposal approval Issue work order
Place loan note for approval Deliver materials
Follow up note for approval
Receiving inspection of sub contract items Receive GRN
Check GRN to account department
Forwarding of GRN to account department
Sending payment with copy of GRN to work contracts Request to store for returning of rejected materials
3.4
MARKETING DEPARTMENT
DEPARTMENT STRUCTURE
North India is the main market of KAL. In 3 wheeler industry KAL has only 1 % market share.KAL mainly produce 3 wheeler chassis and send it to the godown I north India. Then it is supplied to the dealers as per their demand. The dealers make the body for the vehicle as the customer demands and sells the product. The dealers will get a significant amount in body building.It can be up to 1.4 lakh. This is because different people have different interest and they use this vehicle for different purposes. In kerala KAL cannot compete because there are a lot of manufacturers who gives super-finished goods to the customers. KAL is sharpening the edge to get in to the market. An another reason that the north Indian customers buy the product is that its performance. It have a good mileage and high power that it can run in any conditions of road.KAL is producing fully built vehicles as per demand.
Marketing means making available products suitable for sales. The efficient making department is the corner stone for success for every organization. In KAL marketing department is under the control of GM (marketing). The activities of this department are directly reported to the MD. This department identifies the customers, interact with them and find out their needs and thus figure out the
ACCOUNT OFFICER
SENIOR ENGINEER
ASSISTANT SALES EXECUTIVE
Marketing management is a pre-requisite for the successful Operation of any business enterprise. Marketing management shall be responsible for the after service activities of the company. The marketing department shall maintain a register showing details of the warranty claims against each vehicle. Marketing determines the needs of the customer and sets out the pattern of production of goods and service necessary to satisfy their needs.
Quality
objective:- Extend awareness about MX400 vehicle among all dealers. Locate more dealer outlets in Karnataka and Tamil nude.
Appoint dealers in the unrepresented areas in the northern states. Making available vehicle according to demand of the customers.
Function:- The marketing department ensures that the company’s products are marketing to various outlets, taking in to consideration the demand for various types of vehicles at the various outlets.
Appointment of dealers Dispatch of vehicles
Preparation of sales and dispatch plan
Collecting feedback information of the product. Termination of dealers
Advertisement and sales promotion Transportation management
Contract review
Procurement and sales of spare parts Warranty settlement
Free service coupon settlement Customer complaints
Pre-delivery inspection and provide free service at dealer point Acceptance of order for special purpose products
Procedure for contract amendment
To co-ordinate the function of material production and sales department.
4 P’S OF
MARKETING:-
PRODUCT:-KAL produces mainly 3 wheeler auto rickshaws of diesel as well as petrol versions. At present it is mainly concentrating on the diesel version under the brand name “KAL”.
1) Kerala GL 400 V2 electric start chassis- Rs 76,000 2) Kerala GL 400 V2 rope start chassis – Rs 74,000
3) Kerala GL 400 V2 MX 400 electric start chassis- Rs 83,000 4) Kerala GL 400 V2 rope start - Rs 77,000
New products
1)
Self start (340cc) petrol engine [CNG]2)
Self start (340cc) gas engineOther products: KAL manufactures rocket components for ISRO from 1990. It worths up to Rs 50,00000. It has started manufacturing coir spinning machine and it has become successful. more and more machines are supposed to be manufactured in KAL.
PRICE:-KAL follows cost plus pricing strategy in which the margin is included for its products. It also considers the price of competitor’s vehicles while fixing price.
Market price of its products is kept comparatively lower than the competitor’s model. Before making the crucial pricing policy KAL conducts forecasting for its products mainly by
Feedback from dealers
Conducts market survey
Compare the sales of competitors similar products.
Company also conducts market research with the help of some external agencies
The various products of KAL having different price in various locations and the detailed market price list of the various products are given below
PLACE:-The marketing of vehicles is done through dealers and agents. PLACE:-The main market of the products of KAL is north India. The main markets include Haryana, Uttaranjal, Punjab, Rajasthan, Uttar Pradesh, and Gujarat. Here are also small markets in Kerala and tamilnadu.
Exports:- a major portion of annual production is exported. KAL earning through foreign exports in last financial year were. Its major destinations include Bangladesh,
KAL has signed a memorandum for the export of 1500 diesel 3 wheeler vehicles with meders Liberty Techo Company and it was one of the biggest orders received by the company. The last time export worths $ 1600.
Dealers are selected on the basis of show room facilities, service and man power etc. Company gets in to contract with dealers for a minimum of 2 years. Company has liaison officers at Delhi to co-ordinate the north Indian operations. The main dealers in Kerala are marikar and Kerala state agro industries.
PROMOTION:-KAL Mainly uses customer promotion and trade promotion techniques to enhance sales. Main sales promotion techniques are:
Company participates in auto shows Advertisement in local channels Gifts in all seasons
Incentives to dealers making maximum sales
6 free services are given at crossing 500,1000,2000,3500,4500 and 5250 kms Warranty of spare parts. The warranty is for a period of 6 month from the date
of purchase or crossing 5000 km which ever is earlier Sales incentives to the dealers as sales promotion
Sales In Last 9 years
No Year Sales 1 2001-2002 6858 2 2002-2003 6185 3 2003-2004 6756 4 2004-2005 5091 5 2005-2006 5900 6 2006-2007 4900 7 2007-2008 2917 8 2008-2009 1605 9 2009-till 2605
Total number of 3 wheelers sold out til now is : 1,20,000 vehicles.
Competitors:- Bajaj auto ltd Piaggio auto Atul auto industry Sitarn auto industry
STATE NUMBERS
Haryana 12
Punjab 10
Rajasthan 15
Uttar Pradesh 8
Dealers are given special incentives on achieving the more target and on selling more product. Dealers are given special offers to keep a good relationship with them. KAL provides all the support both technically and in management level. But nowadays there are no high sales.
Special orders: sometimes KAL receives special order from Travancore dewaswom board. KAL manufacture special purpose tippers for them.
Other activities:.
3.5
FINANCE DEPARTMENT
DEPARTMENTAL STRUCTURE
Seven persons are enough to start a public limited company.a company is started by contributing money. The capital of KAL is contributed by Government of kerala when
ACCOUNT OFFICER ASSISTANT ACCOUNTANT ASSISTANT ACCOUNTANT CLERICAL STAFF ASSISTANT MANAGER (FINANCE)
CASHIER
INTERNAL
AUDITOR
COMPUTEROPERAT
GENERAL MANAGERtill 1992.then a revival package was allowed by BIFR.It was approached to banks to get money and to government for grand. In 1994-95, it started making profit. It continued up to 2004-05. Its accumulated loss was wiped out and it snet worth became positive. There was a surplus in the balance sheet. From 2005-06, it again came to loss and continues till now.This is because the production and sales is not enough to meet the target.
Current status:
Companies accumulated loss – 15 crore.
Companies net worth is negative.(net worth = asset – liability)
Production less that 300 vehicles a month will make liability. So, R&D is to be developed to get it manage. They have to give quality product. Nowadays company suffers the lack of sufficient amount of fund for the day to day operations.The government should provide more money to meet working capital. There are crores of rupees as current liability.
Money is the life blood of any organization as it is required to purchase raw materials and machines, to pay wages and salary etc. the financial statement of the company is prepared under the convention accrual basis as a going concern. Complying with the accounting standards prescribed under the companies act 1986. Documents for original entry are prepared directly in the computer and a copy is sent to the appropriate authority for further verification and approval. If any entry is to be certified, it can only be done through an adjustment document. This ensures security of documentation against any accidental errors or manifestation. The ultimate responsibility of carrying out the finance functions lies with the top management. Thus a department to organize the financial function should be under the direct control of the Board Of Directors.
MAIN FUNCTIONS:
Cashier collects cash receipt . If any payment is taken place, a bank payment voucher is prepared. Every voucher is prepared by the debit and credit system through the computer. When transaction takes place, a sales invoice is prepared by the marketing department for the dealer. When invoice is prepared, the computer database is used to create debit and credit and which is sent to dealers. From sales list, a trial
Every transaction is prepared by clerk. It is send to the finance manager. Then the payment is given by the cahier.
Cash receipt/payment Bank receipt Finalization. Capital structure Purchase. Sales Managing computer. Preparation of VSR Withdraw/receive/payment of cash. Position and filling of VRS.
Settlement of tax, temporary salary, interest advance. Payment of retainer fee.
Physical verification of cash.
Verification/approval of all cash /bank receipt and payment vouchers. Bank receipts/payments
Preparation of RT vouchers. Amount transfer vouchers. Writing of cheque.
Generation bank books.
Preparation of bank reconciliation statement. Verification of checklist of sales bills, stipend etc. Remittance of all recoveries made from salary. Settlement of canteen account etc.
Finalizations
Analysis of ledger. Ratification of errors.
Adjusting and clearing entries.
Preparation of trial balance, P&L accountant & balance sheet. Assisting internal audit.
Assisting statutory audit. Preparation of annual reports. Capital structure
Capital structure is a major aspect of financial planning. The capital or funds come in the form of long term and short term departments, preferences and equiy shares. The company has no share holders other than loan from Kerala government. The company’s other financial support is only from the financial institution SBI. Debt-equity ratio of the company was 6.7:1 I n2001-02, .44:1 in 2002-03, .38:1 in
Purchase
Opening tenders
Posting and filling GRN
Preparation of payment vouchers Analysis of supplier vouchers Analysis of supplier account. Sales
Arrange follow-up invoice. Preparation of sales tax return. Payment of incentives.
Warranty claim statement. Attending sales tax hearing. Verification of account. Managing computer
Salary bill processing. Arrears calculations.
Keeping the accounts database.
Calculating the employee benefits, credits, debts etc. Preparing the documents of transactions.
