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REPORT ON ORGANISATIONAL STUDY AT
D.C.MILLS (P) LTD ALAPPUZHA
BINEESH MOHAN
(Reg. No: 85290011)
Under the Guidance of
Dr. Molly P Koshy
Reader, CUSAT
Submitted in partial fulfillment of the requirement for the award of the
degree of
MASTER OF BUSINESS ADMINISTRATION
to the Cochin University of Science and technology
School Of Management Studies
Kochi-682022, Kerala, India
Year-2010
DECLARATION
I BINEESH MOHAN, third semester MBA student of
school of management studies at the Cochin university of
science and technology do hereby declare that this report
on ORGANISATIONAL STUDY AT D.C.MILLS ALAPPUZHA
under the guidance of Dr.Molly.P Koshy, Reader, School
of Management Studies in partial fulfillment of the
requirement for the award of the degree of Master of
business administration is a bonafide study I have done in
the organization. I also declare that this report has not
been previously formed the basis of award of any Degree,
Diploma, Associate ship, Fellowship or any other similar
title of this or any other university or institution.
Place: Bineesh Mohan
Date:
ACKNOWLEDGMENT
The accomplishment of this Organizational Study at D. C. Mills
has been considerably influenced by the valuable assistance
received from various sources.
I’m deeply indebted to Mr. K.J Dennis, Managing Director,
D.C.MILLS (P) LTD ALAPPUZHA, for granting permission to do my
organizational study. I express my sincere thanks to Mr.
Lalichen Arackal Senior H. R Manager for his approvals and
guidance. Also thanking Mr. Joseph Fernandez Asst. Manager
HRD for his support and guidance. I thank Mr. Robin (HR
executive) who gave me necessary instructions and guidance
throughout the study. Sincere thanks to various department
managers and staffs for their help and support.
My special thanks to Dr. Molly P Koshy, Reader, School of
Management Studies, CUSAT for her guidance and
encouragement.
I also extend my sincere gratitude to our Director, Prof. Dr. K B
Pavithran, of School of Management Studies of the Cochin
University of Science and Technology.
ABSTRACT
I underwent an organizational study at D.C.MILLS (P) LTD
ALAPPUZHA to acquaint myself with the business environment for
a period of one month from May 19, 2010 to June 18, 2010 as a
part of the MBA curriculum at the School of Management Studies,
Cochin University of Science and Technology.
The study was conducted to understand the structure, function
and processes of various departments and their interdependence.
During the course of study I was able to successfully interact with
the employees of the organization. They were happy to give me
all possible information.
The methodology consists of data collection through interview,
observation and literature review. The data collected from
different sources are classified, analyzed and interpreted. Based
on which an organizational structure, its functions and various
departments are identified. The various departmental functions
are clearly identified and their processes & activities carried out
are recorded. The study helped me to obtain an exact picture of
D.C.MILLS based on which, a swot analysis is done.
CONTENTS
I. INTRODUCTION.
2. INDUSTRY PROFILE.
2.1 World scenario of coir industry.2.2 Indian scenario of coir industry.2.3 State scenario of coir industry.
3. COMPANY PROFILE.
4. PRODUCT PROFILE
4.1 Products made from coir4.2 Products made from rubber4.3 Products made from sea grass4.4 Products made from sisal4.5 Products made from jute4.6 Washable collection
5. OBJECTIVES
5.1Quality objectives5.2 Quality policy5.3Company policy
6. AWARDS
7. ORGANIZATION CHART
8. DEPARTMENTAL PROFILE
8.1 Sample department8.2 Purchase department8.3 Stores department8.4 Production department8.5 Human resource department8.6 Marketing department8.7 Finance department8.8 Information technology department
9. SWOT ANALYSIS
10. Observations
11. Suggestions
12. CONCLUSION
13. BIBLOGRAPHY
1. INTRODUCTION
Among the several natural industrial ‘hard’ fibers which enter the
world’s markets today, coir occupies a unique place. It is put to
many uses industrial, agricultural and also as a substitute for
certain cordage for which it is claimed to be superior to hemp and
sisal. Coir is one of Kerala’s most important products. Coir is a
natural fiber that helps hold together the coconut shell. When
extracted, it can be spun into one of the world’s strongest threads
and woven into mats and baskets of all kinds.
In most coconut producing countries the main coconut product is
“copra” the coconut meat. The husks are burned as fuel, used as
manure, or discarded. In Thailand, East Africa, India and Sri
Lanka, coconut husk fibers are used additional products. Fifteen
countries of the Asia-Pacific region produce 86% of the coconut in
the world. But only a handful of them are known to be coir
producers. India is the largest producers and exporter of coir and
coir products. SriLanka, Indonesia, Malaysia, Philippines, Thailand
and now Vietnam are the other primary producers of coir with
varying levels of production capabilities.
The coir industry, which was confined to Kerala, has now spread
to other states like Tamil Nadu, Karnataka, Andhra Pradesh,
Orissa, etc over the years largely on account of various
developmental and promotional programmes. Alleppey is the
nerve centre of Kerala’s famous coir industry. Here we can see
coconut husks being beaten into fiber for making beautiful mats
and other coir products. Apart from its traditional use as rope,
yarn and floor coverings, coir fiber is finding new applications as
an eco-friendly substitute for wood and synthetics. A long term
biodegrable geo-fabric for soil bioengineering and garden articles.
The by product of coir industry, coir pith, is increasingly being
used as a soil conditioner. The future of coir industry depends on
the non-traditional areas and non-conventional products.
2. INDUSTRY PROFILE
Coir industry occupies a unique place among the rural traditional
cottage industries in India. The state of Kerala, also known as the
'land of coconuts', is the largest producer of Coir in India. It
accounts for more than 75% of the total production. The
preparation of Coir is a lengthy process. The coconut husk is
immersed in water for Rubberized about a month. Later softened
husk is beaten to separate the fiber from the husk. This then
woven into coir.
Coir-foam, rubberized coir is used to make mattresses and pillow
covers. These have gained popularity due to their softness and
durability. Floor mats, carpets and durries too are made. Other
handicraft items like bags, wall hangings, dolls and animal figures
etc. are made. The jewellery made out of Coir is fascinating
because of its intricate and delicate designs.
Coir is a versatile natural fiber extracted from mesocarp tissue, or
husk of the coconut fruit. The husk contains 20% to 30% fiber of
varying length. After grinding the husk, the long fibers are
removed and used for various industrial purposes, such as rope
and mat making. The remaining material, composed of shot and
medium length fibers as well as pith tissue, is commonly referred
to as waste grade coir. The waste grade coir may be screened to
remove part or all of the fiber, and the remaining product is
referred to as coir pith.
2.1World Scenario
Currently, the global annual production of coir fiber is about
350,000 metric tons (MT). Yet, even in the world’s top two
producers, India and Sri Lanka, which account for about 90% of
global coir fiber production, combined, this renewable resource is
underutilized; local coir mills process only a fraction of the
available husks, which accrue more or less year round as a waste
during coconut processing.
Traditional uses for the resilient and durable coir fiber include
rope and twine, brooms and brushes, doormats, rugs, mattresses
and other upholstery, often in the form of rubberized coir pads. In
the 1980s and 90s, global exports of coir fiber fell by almost half,
as Western consumers shifted to synthetic foam and fibers. Then,
since 1990, rapidly growing domestic demand in India more than
doubled global production benefiting exclusively the Indian coir
industry.
Finally, since 2001, a rising Chinese demand for coir, an
expanding market for coir-based erosion control products, and the
spread of coir pith as a peat moss substitute in horticulture has
further pushed up global production and prices. In turn, other
coconut growing countries, including Philippines, Thailand and
Vietnam are now expanding their production and export of coir
fiber. These changes are also reflected in the international trade
in coir. Historically, Sri Lanka had been the world’s largest
exporter of various fiber grades, whereas India exports largely
value added products – yarn, mats, and rugs. While in 1990 about
80% of global production was exported, growth of the Indian
domestic market dropped that rate to below 40%.
Global trade volume for coir fiber, value added products – yarn,
mats, rugs – and coir pith now stands at about $140 million per
year with India and Sri Lanka respectively accounting for about
$70 and $60 million of that amount. This may not seem much but
in the coconut regions of producing countries coir is an important
economic factor. The challenge for coir industry is to sustainably
expand markets for this versatile renewable resource while
maintaining its role as employer for the rural poor. This may
require producers to innovate production, improve product
consistency, and in particular develop novel applications – jointly
with their customers in importing countries. Businesses, public
agencies and research institutes are now addressing this
challenge in multilateral projects worldwide – setting examples
that global trade can be beneficial to all parties involved.
The major coir producing countries are India, Sri Lanka and
Thailand, while Philippines, Vietnam and several South American
and African countries have entered the fray looking towards
further expansion. At present only an estimated 10% of the husks
from global coconut production are used for fiber extraction,
producing about 480,000 tons of coir annually. Around 100,000
tons of this enters the world trade, the balance being consumed
locally in coir producing countries. While fiber demand in
importing countries has declined due to inconsistency in quality
and delivery, the global coir trade decreased from 160,000 tons
two decades ago to 123,000 tons.
2.2Indian Scenario
Indian coir industry is an important cottage industry contributing
significantly to the economy of the major coconut growing States
and Union Territories, i.e., Kerala, Tamilnadu, Andhra Pradesh,
Karnataka, Maharashtra, Goa, Orissa, Assam, Andaman & Nicobar,
Lakshadweep, Pondicherry, etc. About 5.5 lakh persons get
employment, mostly part time, in this industry. The exports from
this industry are around Rs. 70 crores. Coconut husk is the basic
raw material for coir products. Around 50 per cent of the available
coir husk is used to produce coir products. Hence, there is scope
for growth of coir industry. India accounts for more than two-
thirds of the world production of coir and coir products. Kerala is
the home of Indian coir industry, particularly white fiber,
accounting for 61% of coconut production and over 85% of coir
products. Although India has a long coastline dotted with coconut
palms, growth of coir industry in other coastal States has been
insignificant.
During the Seventh Plan period, encouragement has bee given for
expansion of home market through publicity and advertisement,
product diversification, adoption of new technology, research and
development, training for artisans, including women and social
welfare measures for coir workers, most of whom are SC/ST and
women.
The Eighth Plan programmes for coir industry aimed at increased
utilization of coconut husk for production of coir fiber, growth of
the domestic market, strengthening of research and development
to find out new uses of coir fiber especially in the areas of geo-
fiber, fire retardant, cement and gypsum polymer development,
acquiring of new technology like PVC-tufted coir products,
encouragement to cooperativisation and providing social welfare,
civic amenities and medical facilities to coir workers.
Emphasis would be laid on mechanization in a phased manner
without affecting employment to make Indian coir products
competitive in the export market. Brown coir fiber production
would be encouraged by providing seed capital assistance.
Modernization of coir units has been envisaged by providing
incentives for installation of modern equipments to make coir
industry more competitive in the export market.
Special training programmes have been formulated for women
artisans. Improved modern treadle ratts would be provided to
trained women artisans to increase employment and earnings.
Medical facilities, crèche for children of coir workers, model coir
villages for SC/ST coir workers and social welfare schemes would
be implemented during the Eighth Plan period. Emphasis has
been given on developing devices/equipment/machinery through
R&D to reduce drudgery and to improve productivity of coir
workers. Development of improved variety of ratts and looms
would help in improving the production of coir yarn spinning, coir
mats, etc. In order to boost exports, the scheme of cooperative
publicity/programme in the export markets which was started in
the Seventh Plan would be continued.
Not more than 50 per cent of the coconut husks is utilized in the
coir industry, the remaining being used as fuel in rural areas.
Production in the cooperative fold is not more than 20 to 25 per
cent. The development programmes so far undertaken aimed at
revitalization of coir cooperatives, improvement in quality and
products diversification. Efforts were also made for exploring
wider export markets for coir and coir products. Judged from the
increase in production and employment, the progress has been
rather slow and exports in physical terms have remained mere or
less static
2.3State Scenario
The history of coir and its association with the state of Kerala
dates back to the 19tth Century. Sandwiched between the Western
Ghats on the east and the Arabian Sea on the west. Kerala is one
of the most beautiful States in India. A tropical paradise of waving
coconut palms and wide sandy beaches, this thin strip of coastal
territory slopes down from the mountain ghats in a cascade of
lush green vegetation and varied fauna. One of the most
commonly seen tropical trees in Kerala is the Coconut tree. In
fact, even the name Kerala (Keralam in Malayalam) is derived
from this tree. Everything from Kerala’s culture to its dishes is
evolved around the Coconut tree.
Alleppey is the nerve centre of Kerala’s famous Coir industry.
Here, we can see coconut husks being beaten into fiber for
making beautiful mats and other coir products. Both men and
women are actively involved in the production of the coir. The
women are mainly involved in the yarn spinning sector and the
men in the product-weaving sector. Coir industry enjoys the
status as the largest cottage industry in the State of Kerala,
giving employment to over a million people. Kerala also has a
very fine natural harbour located at Cochin had found a place in
the minds of Europeans as a trading centre because of its port
and spices.
The coir industry, one of the major traditional industries in the
State and second only to agriculture as a source of employment
in Kerala, provides employment to around 4 lakh persons, of
which 84% are women. With 10.05 lakh hectares under coconut
cultivation, this accounts for 45% of the net cropped area in the
State. Concentration of coir industry in the State is Alleppey,
Kayamkulam, and chirayinkeezhu, Kola, North Parur, Trichur,
Kozhikode, Kannur and Vaikom. In this industry varieties of coir
yarn produced such as Ashtamudi, Anjengo, Artary, Vaikom,
Koilandy, Arror Sp, Muppine, Rope Yarn. Main coir products
produced and exported include Mats, Matting, Rubberized coir
pith, Rugs, Carpets, Curled coir.
The various agencies for promoting coir in the state include a Coir
Directorate, Coir Workers’ Welfare Fund Board, Coir Parks, Coir
Fed, Coir corporation, and coir Board and so on. The government
contributes to the coir Workers Welfare Board to provide welfare
measures that include pension to coir workers, educational
assistance to the workers’ children, marriage assistance, and
provision of geriatric centers and so on.
2.4 State Scenario
The economy of the Alappuzha is predominantly based on
agriculture and marine products. Though Alappuzha is industrially
backward, some traditional industries based on coir and coir
products, marine products, handlooms, different types of
handicrafts, toddy tapping, etc, have been dominating the scene
from the very early times. Alappuzha is known as the traditional
home of coir industry in Kerala.
The easy availability of raw materials and existence of backwaters
and canals suitable for the wetting of green husk and accessibility
of transportation are the main factors for the development of this
industry. Such sources are abundant in the district and these
favorable factors, which have helped the growth of the coir
industry in Kerala.
Since, coir is produced from coconut husks, people started
investing in the industry, mainly southern part of the country,
which was due to the abundance of coconut trees and adequate
facilities for natural retting. As a result of this, Kerala has a major
part to play a role in coir industry, which is the largest
manufacturer of coir products in India. In, Kerala Alappuzha is the
main centre of investment.
The Coir Board was established by the Central Government under
the provisions of the Coir Industry Act,1955. there is a Coir
Research Institute functioning at Kalavoor. The National Coir
Training and Designing Centre were also established at Alappuzha
in 1965. all these institutions are helped the development of coir
industry in Alappuzha.
The water linkage between Alappuzha town and yarn producing
centers and the port facility for shipment of finished products to
various countries abroad accelerated the growth of coir industry
in Alappuzha. In fact it has been rightly called the Venice of the
east due to this reason.
2. COMPANY PROFILE
DC Mills is the first ISO 9001-2000 certified company for coir
products in India from TUV CERT OF RHEINISCH-WESTFALISCHER
TUV E.V. and first in the world for vinyl backed coir products from
TUV CERT. Spanning two decades, DC Mills foray in the coir
products exports is a magnificent example of growth rooted in
determination of a management with a vision seldom seen.
Attentiveness to customer tastes and preferences, commitment
to quality, dedication to timely delivery and extensive range of
products make D.C. Mills the numero uno in floor covering
business. Their specialties include tailor made designing services
in the areas of export of coir products, jute India, Indian carpets,
natural fiber, rubber and bamboo mats, bath rugs and PVC mats.
They also offer you an exotic range of colors, styles and designs.
DC Mills is recognized as one of the top exporters of coir products
in Kerala, India.
In the year 1982 D C Mills started export of Indian natural fiber
door mats and floor coverings under a young and dynamic
management, with its own manufactories by Mr.K.J.Dennis. Now
they have six manufacturing units with modern and sophisticated
machineries in Valavanadu, puthenambalam, Pollathy,
Pathirappally, U.S.A and U.A.E. D C Mills is presently
manufacturing coco, sisal, jute, wall to wall carpet in 4 meter
width and sea grass.
A Holland made power loom machines used by the company to
manufacture good quality latex backed carpets. Company also
manufacturing high quality door mats and area rugs in good color
fastness in water and sunlight. Its own modern dyeing and
printing factory for the best result of color fastness its quality
checking department ensures the quality to the taste of all global
customers.
In 1997 D C Mills started a new factory on 3 million US dollars for
vinyl backed coco rolls and door mats with flock designs of World
class, as same as European style company also manufacturing
different types of rubber doormats and outdoors. Now the
customer can have all the requirements of natural fiber floor
covering from D C Mills collections.
Another new product range from the company for their customers
are the new generation mats made of softolefine, nylon, wool and
yarns. The company has the most modern BCF machine for
extruding yarns and multi operational coating machine for the
square pyramid and bubble backing.
The company also owns highly advanced fully automated tufting
machines imported from England and USA for the production of
poly propylene mats. The present production capacity of the
company is around 100 containers of 40 feet size per month. The
installed capacity of plant is 10000 squire meters per day.
The company has a workforce of more than 1500 employees with
another 5000 people indirectly involved in its operations. At DC
Mills, constant innovation is of prime importance. To this effect, a
modern and a highly sophisticated R & D division equipped with
the latest information software and hardware forms an integral
part of DC Mills. A team of well-experienced software
professionals head the department. The plethora of awards the
company has been earning ever since its inception stands as a
solid testimony to the commitment, success and efficiency of the
company’s production team.
A significant milestone in the growth trajectory of the company
was accreditation by British retail consortium (BRC) in 2008. The
company is now BRC certified global recognition fot safe
consumer products. The company has been regularly receiving
awards in recognition of outstanding export performance. In
recognition of highest performance in export, D.C Mills has
received the prestigious award from the Prime minister of India
consecutively for the past 14 years. The latest award was the one
honored by coir board for the best export of 2006-07.
Group concerns of this company are:
D C Mills (P) Ltd.
Detlish Rugs (P) Ltd
Denny Steels (P) Ltd.
4. PRODUCT PROFILE
DC Mills mainly deals with coir products, rubber products,
washable indoor products (in cotton, nylon and wool), coir rubber
products, jute runners and sisac runner. The major products of
the company are:
Imperial mat
Elegant mat
Croma mat
Paragon
Rolex
Endure
Coral
Lovers mat
Rub flocky
Coco flock
4.1 Products made from coir:
Coco shift
Bangal
Queen
Prince
Classic
Super form
Passion
Rainbow
Magic mat
Darken
Crown
4.2 Products made from rubber:
Shoe mat
Iron mat
Hollow mat
Hexagon
4.3 Products made from poly propylene:
Poly rope mat
Non brush mat
Raven
Colombo
Massio
Condor
Crown mat
4.4 Product made from Sea Grass:
Orissa mat
4.5 Products made of Sisal:
Sultan
Mugal
Bombay
4.6 Products made of Jute:
Hawal
Hook
Miami
Jaipoor
4.7 Washable collection includes
Acqa
Lily
Lorry
Milky
Parry
Sigma
Sofine
Coroma
Elite
Eva
Tribo
5. Objectives Of The DC MILLS (P) LTD.
5.1Quality objectives:
a. To meet the customer demands for new designs and develop.
b. To reduce fuel consumption and production wastage.
c. To reduce customer complaints.
d. To control the cost of manufacturing
e. To improve the online delivery
f. To achieve continual improvement on MIS.
5.2Quality policy:
1 Market innovative products fully conforming to or surpassing
customer specifications, delivered on time.
2. Use ecofriendly manufacturing process.
3. Achieve continual improvement of products and manufacturing
process.
4. Always fulfill social commitments.
5.3 Company Policy:
The DC Mills follows a 30-30-30 policy which was formulated by
the M.D, Mr. K.J.Dennis. Every query from the part of the
customer will be addressed within 30minutes. The customer will
be provided with a sample within 30hrs and the shipment will be
made within a period of 30days from the receipt of the order. This
is the 30-30-30 policy.
6. Awards
Certificate of merit for the export of coir products 3rd
position during the year 1992-93.
Second position during the year 1993-94.
Merit certificate for the outstanding performance in
pioneering efforts during the year 1994-95.
Second position during the year 1995-96.
Certificate of merit from the government of India for
outstanding export performance in coir mats and matting
during the period 1995-96.
First position for outstanding performance in the export of
coir products during the year 1996-97
First position for outstanding performance in the effort in
promoting export and investment in coir industry during the
year 1998-99
First position for outstanding performance in growth in
export of coir products during the year 1999-2000
First position for the outstanding performance in research &
development efforts in product development & product
diversification during the year 1999-2000 .
10.Highest position for the outstanding performance in
export of coir products during the year 1999-2000
Millennium award for the contribution for the development
&promotion of coir industry
Award for the top exporter under cepz for 2000-2001
Award for the top exporter - coir products by Coir Board for
2002
Award for the top exporter - coir products by Coir Board for
2003
Award for the top exporter - coir products by Coir Board for
2004
Award for the top exporter - Chamber of commerce -2005
Award for the top exporter - Chamber of commerce -2006
Award for the top exporter - Chamber of commerce -2007
7. ORGANIZATION CHART
8. DEPARTMENTAL PROFILE
Various departments in DC Mills are:
SAMPLE DEPARTMENT
PURCHASE DEPARTMENT
STORES DEPARTMENT
PRODUCTION DEPARTMENT
HUMAN RESOURCE DEPARTMENT
MARKETING DEPARTMENT
FINANCE DEPARTMENT
INFORMATION TECHNOLOGY DEPARTMENT
8.1 SAMPLE DEPARTMENT
Sample department is the first and important department that
comes before the production department. The duty of sample
department is to develop the samples according to buyer’s
requirement and developing samples according to the world
fashion and trend.
In sample department first the buyer gives the order of any mat
of his choice to the sample department. When the buyer sends
the request, some time he sends the design of his choice and in
some cases he asks the company to send the design for him. The
sample department has its own designers who draw the design
for the buyers. When the buyer accepts the design send by the
company, then that particular design is given a specific number. If
there any changes recommended by the buyer, it will done and
given a new serial number. Then the buyer sends the acceptance
of the design.
After all the acceptance procedure is over, then the sample
department creates a stock order. This checks whether the
company’s store has that much of stock to fulfill the order. Then
the plates and mats are brought and printing is done. Normal
cases there make three sample pieces and out of which one is
send to the buyer. If there any alternation is needed, then it will
send back for modification and buyer places the order. Finally
PRODUCTION MANAGER
SAMPLE IN CHARGE
ASSISTANTS
that order moves to the production department and production
starts.
The sample pieces are printed in the sample department itself
and according to the design plates are designed and with the
plates the mats are printed.
8.12 Departmental Structure
8.13 Functions of sample department
Receiving sample request from buyer through
marketing department.
Developing own samples with fashion and trend
with the co. ordination of designs.
Sourcing of new articles in market.
Checking and Processing.
Check the faults.
8.2 PURCHASE DEPARTMENT
Purchase department is responsible for bargaining, procuring,
managing and storing the raw material needed for the production.
This department plays a very vital role in carrying out the
production process very smoothly. The main function of this
department is to maintain the needed stock in order to avoid the
delay in production. Purpose of buying of material and the
control of stock are of great importance in any business. If the
proper quantity and style of merchandise is bought at the right
place and time, half the task of selling is completed.
Purchases include:
Mat Purchase
Miscellaneous Purchase
Mat Purchase
For this type of purchase, sometime company buys some of the
materials from the local vendors. For the purchase of the
materials like coir and yarn needed for the production of the mats
are purchased from the local vendors. They invite quotations and
for the purchase of materials like PVC powder and glue they out
source the material from out side India. Whenever the material
reaches the company it will pass to the quality section to measure
the quality for the material made by the purchase department.
Miscellaneous Purchase
It will include the purchasing of various materials like machinery
parts, computers and other miscellaneous materials which is
needed for the production as well as administration of the
company.
They maintain minimum level of inventory. The department keeps
the quality standard of raw materials by testing raw materials in
their own lab and prepare master safety data sheet. The
department keeps the records like quotation file, purchase order,
comparative statement analysis and various bills copies.
Production planning along with selection of raw materials to be
purchased shall be done by Purchasing Department.
8.21 Departmental structure
PURCHASE MANAGER
ASSISTANT PURCHASE MANAGER
OFFICERS
OFFICE ASSISTANTS
NEED RECOGNITION
VENDOR SELECTION
DETERMINATION OF PRICE
8.22 The procedure for purchasing
PREPARATION OF PURCHASE ORDER
ACCEPTANCE OF THE
PURCHASE ORDER
FOLLOW-UP
MAKING PAYMENT
The function of purchase department starts from recognizing the
needs of raw materials as per the requisition of the customers.
Then the vendor selection takes place and after that price is
determined. After this purchase order is prepared and acceptance
of it takes place. Then the payment is made.
Need recognition It is the first function in the purchase department. Firstly the
purchase department should find out all the needed items
through the purchase requisition made by the stores
department.
Vendor rating & Selection Most of the raw materials of D C Mills are imported.So
company is trying to make use of indigenous products by
seeking alternative supply so as to reduce cost and
avoidance of low stock of material. Vendor rating is done by
using ABC analysis. Quality, delivery, price and service are
the factors taken for vendor rating.
These factors are rated in the ratio of 50:40:5:5.Here A category
includes quality and delivery .B category includes price and
service. The company is having long-term relationship with many
of its vendors. As part of it, company is providing financial and
other assistance to its vendors. 50% of the company’s partners
are its vendors.
Determination of the price The next function of this department is to determine the price
needed for purchasing the material. Vendors providing
feasible price is selected.
Preparation of the purchase order After selecting the vendor the purchase order is prepared by
the department and sends it to the supplier.
Acceptance of the purchase order The supplier accepts the order and then sends the
acceptance receipt and it is accepted and properly
maintained by the company.
Follow-up Follow-up is made after all these steps. The main aim of this
step is to ensure timely delivery of the material.
Making payment giving Payment is made only to those who maintains and
provides invoice properly. After checking the invoice it is
approved for making payment to the supplier. Modes of
payment are different in case of different vendors. Immediate
payment is to be made to the local coir vendors. In other
purchases one week to one month credit periods are allowed.
Company is also credit period up to one month for the
payment of its products.
8.23 Functions of purchase department
Planning inventory level
In purchase department, inventory consists of a list of goods
and materials held available in stock.
Identifying vendors
The company has a data base which contains a list of vendors.
From these list vendors have to identified.
Procurement of quality raw materials
For the procurement of quality raw materials, keeping up
quality standards.
Issue of purchase order
Purchase order being issued by the purchase department.
Co-ordinate with production department
Purchase department co-ordinate with production department
for achieving the target.
Periodical feedback to vendor through an evaluation
process By proper evaluation in a periodical manner, purchase
department check the satisfaction of vendors and made
changes if any.
8.3 STORES DEPARTMENT
The stores department is functioning as a part of purchase
department. They are following both FIFO & LIFO method for issue
and receipt of materials. They are maintaining different stock
levels so as to avoid the shortage of stock.
Purchase department make orders according to the instructions of
the stores department. Stores department find out any shortage
and surplus in stock and inform purchase department for giving
and taking orders. Warehousing facility is comparatively less for
the company.
Sub divisions of store department
PVC Mat Store
Coir Store
Dying House Store
Paint Store
Chemical Store
Finished Goods Store
Stenciling Store
8.4 PRODUCTION DEPARTMENT
Production is the key function in almost all industrial or
manufacturing concerns. Production is the functional area
responsible for turning inputs into finished outputs through a
serous of production process. The production manager is
responsible for making sure that raw materials are provided and
made into finished goods effectively.
DC MILLS have 6 units and its main unit is at Valavanadu. Several
types of Mats are produced here. The production is based on the
orders. The production departments under the head of production
manager is coordinate with all other departments to see that
production is according to the standard of ISO 9001:2000 and
then it tries to achieve the objectives of the organization.
SENIOR EXECUTIVE
SUPERVISORS
WORKERS
8.41 Departmental structure
PRODUCTION MANAGER
SPOOLING
PVC TUFTING
BRUSHING
FLOCKING STENCILING
8.42 Production process
BLEACHING & DYEING
SHEERING
PACKING
Bleaching and dyeing
Bleaching of coir fiber is important for color improvement. After
sorting raw material according to the shade and color
variations which is taken for bleaching. Dye vat machine is
used for bleaching and dyeing. The yarn material and water is
filled into the tub in the ratio of 1:2.Heat up to 65 degree
Celsius and mix the required quality of bleaching chemicals
and water with the help of a motorized stirrer. After washing
the bleached yarn is continued with dyeing process.
The very same process is followed in the case of dyeing also.
Instead of bleaching chemical, dye and water is heated up to
65 degree Celsius using Hydro extractor for squeezing in order
to remove the water content. After squeezing the yarn is taken
to drier for drying.
Spooling
After the process of bleaching and dyeing, the yarn is spooled
in to bobbins. The coir is spooled in 465 spools and with the
help of these bobbins further production is done. Then it is
passed to the mixing machine, here the coir is mixed with the
pasty PVC mix.
Pvc tufting
The spooled bobbins are then used in the tuft machines to
produce mat. Using the blade fixed in the tufting machine the
coir is cut to one inched pieces and it is placed over the PVC
mixture which is in a liquid form. PVC backing will set after
passing through the machine. After tufting we get a long mat
with huge width having high temperature.
Sheering
PVC mat is passed through sheering machine to level the
heights of one inched coir placed on PVC. The finishing work is
done through this machine.
Mat cutting
After all these process the PVC mat sheet is cutted in to the
sizes needed. Both manual and computerized machines are
used for mat cutting .Using computerized machines mat can be
cutted into different models or designs other than square
model.
Brushing
Brushing process is done to remove the dust and yarn
materials in the mat. Hand brush is done for minimizing the
wastes and then it will go for printing and flocking.
Flocking/stenciling
After brushing, the mat is gone either to the flocking section or
to the stenciling section. In some cases it is needed to pass
through both the stages. In such case, stenciling is done firstly.
Flock powder and glue is used in the flocking process.
In this process flock powder is spattered into the mat and the
flock powder will get fixed only on the gummy part of the mat.
In stenciling process, paint is sprayed on the mat on which
stencils is placed.
Packing
After completing the above production functions the products
are forwarded to the packing section for packing .Different
types of packing and labeling are used by the company as per
the order.
Steps in packing
Tagging
Labeling
8.43 Functions of production department
Receiving orders from marketing department.
Receiving original samples from sample department or
develop samples as per buyer specification.
Production planning according to the time and ordered
quantity.
Inspection of produced or purchased mat
Stenciling.
Inspection.
Packing.
Final inspection of goods ready to dispatch.
Forward to shipping.
8.44 Responsibilities of the production manager
To establish standards and target for each section of the
production process.
Effective co-ordination of various production processes.
Ensure products are produced as per the buyer’s
specifications.
Try to reduce the cost of production.
Reduce wastage by the maximum utilization of raw
materials.
8.5 HUMAN RESOURCE DEPARTMENT
The human resource department is mainly concerned with the
whole development of work force. For any organization
employees are hidden assets. Without these employees no
company can work effective. HR department is considered as an
indispensable part of every organization. The personnel and
administration department comes under this department.
Human resource development department is a very important
functional department in any organization. Human factor in any
organizations considered as a significant aspect. Because every
business enterprise must ultimately depends upon the best
possible efforts of the human beings works for it.
ASST: MANAGER HR
HR ASSISTANT
SECURITY SUPERVISOR
OFFICE ASSISTANTS
8.51 Departmental structure
DC Mills has an eminent HR department managing around 1500
employees, to enable the smooth functioning of the company. HR
department is practicing various programmes including human
resources planning, recruitment and selection, training and
development, orientation placement and induction programmes,
welfare and social security measures, job analysis and evaluation,
compensation management system, grievance handling
measures, work committee, measures to reduce turnover and
absenteeism.
SENIOR MANAGER HR
8.52 Functions of human resource department
Manpower planning
DC Mills is conducting planning and forecasting activities to assess future need of employees. Manpower planning is the process of determining manpower requirement and the means for meeting these requirements in order to carry out the integrated plans of the organization.
Recruitment
This is the most important function of HR department. Recruitment is the development and maintenance of adequate manpower resources. It involves the creation of a pool of available labour upon whom the organization can depend when it needs additional employees. The company adopts following recruitment methods.
Registers system- it is the form of register
maintained by the company to recruit employees
Campus recruitment-company also recruits fresh
candidates from colleges and other professional
institutions. It is mainly done for engineering and
managerial post.
Advertisement in news papers
Employee reference
Walk in workers
Selection
Selection is done for selecting right person for the right job with
requisite qualification and competence to perform the job. D C
Mills have the following selection procedure.
Preliminary Interview / Group Discussion
Application Blank
Employment tests
Employment Interview
Reference check
Medical exam
Final Selection
Training and development
Company maintains a training calendar through which a company
forecast its training programme. The company takes suggestion
of supervisors for training methods. Off the job as well as on the
job training methods are provided.
The company is providing training to existing as well as new
workers as and when necessary. Workers are provided counseling
frequently to give assistance to them in their duties. They are
motivated through the counseling programmes towards the
performance of work and thereby achieving organizational goals.
Company adopts a full fledged training programme for
employees.
Chart showing the treatment of a new employee
New employee
Prepare training plan
Induction to the system directly
Identify need through questionnaire
Orientation, Placement and Induction programmes
When new people are placed, the company is very cautious in
giving enough orientation and Induction programmes to them.
Company is providing more training and development to them so
as to get acquainted with the nature and functioning of the
organization.
Welfare and Social security measures
Welfare measures include the following,
Welfare Society
Company maintains welfare society for the welfare of its members, staff and workers.
Sneha Bhavan
Issue circulars
Identify faculty
Evaluate effectiveness
Company provide house under Sneha Bhavan
programme to those workers who does not have house.
Tour programmes
Company conducts tour programmes for providing
entertainment to staff and workers each year.
Wedding Programmes
For the staffs and workers who are in the poorer section
the company conducts wedding programmes.
Cultural programmes
The company conducts many cultural programmes like
arts and sports for the entertainment of members,
workers and staffs.
Educational facilities
The company is also providing educational facilities for the employee’s children.
Health insurance schemes for employees
Yearly get together of employers and employees
family members.
Job Analysis and Job Evaluation
Job analysis is made for each job to know about the nature of
job and the requirements of the job. By doing this, the
company can understand which type of people are required
for each job and their qualifications and abilities.
Job evaluation and performance appraisal is also done to
know about the performance level of each employee to give
assistance to them to improve this performance level. It also
helps to fix the remuneration to workers. In D C Mills most of
employees are paid on the basis of their performance.
Performance appraisal is made in every three months.
Compensation Management System
DC Mills is maintaining effective compensation
management system so as to give prompt and correct
payment to its employees. They are also giving incentives
to its workers or employees to motivate their performance
of job.
Grievance Handling Measures
The company is provided grievance box in each working
unit or sections so as to put complaints and suggestions by
the employees.
Works Committee
To maintain a good industrial relation, D C Mills create
works committee which includes participants from almost all
departments & sections. Problems of all employees are
discussed & solved in the works committee. Works
committee meets once in three months.
Measures to reduce Absenteeism
Company is taking measures to reduce turnover and
absenteeism by providing various incentives to employees.
Counseling is given to reduce absenteeism. If it is not
effective, as a final treatment punishment measures are
taken against them.
8.53 Responsibilities of the human resource
manager
To ensure better working condition for the
employees.
To implement the policies framed by the top
management.
To encourage employees welfare activities.
EXECUTIVES
OFFICE ASSISTANTS
MANAGER
Formulation of policies on wage and salary
administration, performance appraisal, welfare
activities etc.
Establishment of a proper system for the collection of
feed back.
Problem solving like grievance over distribution of
overtime work, annual increase in pay, transfer
promotion and so on.
8.6 MARKETING DEPARTMENT
8.61 Objectives of Marketing Department
Achieving and sustaining customer satisfaction
Explore new markets of the company
Explore new distribution channels
Develop new marketing policies
Conducting market research
Reports at regular intervals.
Control marketing activities.
In order to achieve the above objectives the department
concentrates on Internal & External communication. There should
ensure proper communication takes place right from the receipt
of enquiry till the goods are on board.
8.62 Order enquiry
In D C Mills order enquiry is made through trade fairs, through
Export, through Promotion councils etc. Samples are developed
according to the buyer’s requirement and forwarded along with
prices. Sample Department takes care of the same.
On acceptance, the buyer forwards an order sheet containing
details as to the item required, quantity, price, and terms of
payment and with Ship date as required.
The company is now going to introduce their washable products
which are produced in their unit at Pathirapally in the local market
taking into account the acceptance of those products in India.
A new marketing department is created by them for this purpose.
Now they are launching advertisements for those products.
8.63 Process taking place on the receipt of the order
RECEIPT OF ORDER
ORDER REVIEW
ORDER ACCEPTANCE-PROFORMA INVOICE
RECEIPT OF L/C PROGRAMME SHEET
PRE-SHIPMENT SHIPMENT PLAN
DOCUMENTS
POST-SHIPMENT PACKING INSTRUCTIONS
DOCUMENTS
DESPATCH OF GOODS
On the receipt of order, the order sheet is reviewed for quantity
and ship date. Once the order is reviewed, the company
expresses its acceptance by forwarding Proforma Invoice, wherein
all details regarding the items to be produced, price, ship date,
etc are given. This enables the buyer to open Letter of Credit.
8.64 Terms of payment
The various terms of payment, which the company accepts by
mutual consent are as follows:
Telegraphic Transfer
Cash against document
Letter of Credit
8.65 Terms of shipping
The terms for shipment include:
Free on Board
Cost & Freight
Cost, Insurance & Freight
8.66 Work order
This is an internal document, which the department issues to the Production unit. After giving this production facility like dyeing, weaving, stenciling etc are planned in advance.
8.67 Special instructions and packing instructions
Special instruction is also an internal document, which contains
details as to the quality parameters of a particular item, as
required by the buyer. Packing instruction which also falls under
the internal document, is issued to the production & packing
department, where details of tag & label, stickers if any is given
along with the packing details.
8.68 Invoice
It covers the value of goods, port of discharge, final destination,
terms of payment etc.
8.69 Packing list
It covers packing details of the goods i.e. number of cartons,
number of pieces packed per carton, net weight, gross weight,
volume etc.
8.610 Despatch of goods
Once the goods are inspected and packed, they are ready for
dispatch and arrangements are made for the same.
The goods that are dispatched can be of two types:
1.FCL – Full Load Container
2.LCL - Low Container Load
8.7 FINANCE DEPARTMENT
This department deals with finance and its management. And also
keeps all the accounts of the company. Finance is the life blood of
the every company. So its management merits special
importance. For the effective functioning of an organization, the
primary necessity needed is adequate finance. Proper allocation
of finance at right time is necessary for the achievement of
company goals and objectives.
8.71 Departmental structure
G M (F&A)
Manager (F&A)
8.72 Activities of the finance department
Sources of finance
Sales realization
Credit from supplier
Short term and long term loans
Ploughing back of profits
Maintenance of records
The company using mercantile system for the maintenance
of records. The company preparing cash account all other
statutory accounts.
Depreciation policy
The company is following written down value of
depreciation.
Treasury Manager
Accounts Officer
Accounts Asst.
Accounts Asst.
Accounts Asst.
Accounts Asst.
Accounts Manager
Manager Costing
Manager
(Forex)
Accounts Asst.
Accounts Asst.
Budgets
The company is preparing budgets annually to forecast the expenses and revenues.
Working capital management
Stock management, Debtors management, Creditors
management, cash management etc are made by the
company as a part of working capital management and
using all details after assessing the working capital need of
the company.
Provision for acquisition of assets
Company is not taking much effort to make provision for
acquiring new assets. The reason is that the owner of the
company is using major part of the profit for company’s
expansion and development.
Credit policy
The company is providing maximum of one month credit to
its buyers and they are getting credit periods of one week to
one month from its suppliers. Some suppliers are needed to
be paid immediately.
Ratio analysis
The company is making ratio analysis to assess its
operational efficiency. Turn over ratio, current ratio etc are
analyzed every year.
8.73 Functions of finance department
Financial analysis, planning and control of finance.
Management of current assets.
Identification of sources and use of funds.
Preparation of financial statement.
8.8 INFORMATION TECHNOLOGY DEPARTMENT
DC MILLS are fully computerized and all its transactions are
recorded through computers. DC MILLS have developed a
separate ERP program for its operation. Once the order is
entered, it will go to the purchase department, stores, finance and
partially to the production department. For accounting function
visual basics are used for programming. DBMS is also there in the
organization on an SQL server. In the company there are 60
computers inter connected as WAN with OFC technology.
8.81 Functions of IT department
Co- ordination of technology throughout organization.
Assist departments in applying technology to meet
their respective needs.
Purchase equipment.
Concept planning.
Install, support and maintain systems and standard
technologies
9. SWOT ANALYSIS
Strengths
It is the first ISO 9002 certificate holder for coir products
in India
First in the world for PVC backed coir products.
Keeping quality products by using good and standard raw
materials.
Well equipped personnel for effective running of the
business
From the year 2000 onwards, the company has been
honored with the best coir exporter by the Government of
India.
Customer satisfaction is the key word for the
organization.
The company has its own warehouse in foreign countries
Company owns most modern machinery
Effective organizational planning
Company has a high future growth.
Weaknesses
Some of the raw materials like glue and some molding
machines are imported. The timely availability of these
materials affects production.
The costs of these materials are costly.
No measure to recycle the wastage.
There is no canteen facility for the employees.
Opportunities
Being an export company it can enter into foreign market.
Company has enough facility for future expansion.
The company can tap newer markets because the company
has its own potential.
Company is having a good project and implementation
department. This will have the capacity to produce new and
variety products.
Availability of raw materials.
Threats
Rigid taxation policy acts as a hinder to enter into foreign
market.
Tough competition.
Increase in the price of the raw materials.
The trade union intervention will occur as a threat.
Strikes in the coir sector affect the working of the company.
Rubberized coir from Sri Lanka and coir geo textiles from
Vietnam, cheaper coir products from Thailand, Philippines
have taken a part of the export share held by Indian coir
products.
10. OBSERVATIONS:
Major observations are:
DC MILLS is a 100% exporting company. Company is
committed to a process of continuous improvement. It is
market leader of coir exports in India.
The company has the most modern machine for extruding
yarns and multi-operational coating machine for the square
pyramid and bubble backing.
DC MILLS is an example of efficient management. All the
functions are fully computerized.
Company has a good recruitment and selection policy
through which it possess a talented and enthusiastic work
force in the administration as well as operative level.
11.SUGGESTIONS:
Try to produce all raw materials in India.
It will be better for the company to procure some of the raw
materials within the country which will reduce the cost of
production.
It is better for the company to enter into local market.
Entering into the local market helps to capture the Indian
market along with the foreign market.
Developing a recycling plant.
Wastage is part of production. That cannot be eliminated but
can be reduced or can be recycled.
12. CONCLUSION
Being a 100 % export oriented unit D C Mills is now in the
position of the top exporter of coir products in India. They are
having a good reputation in the coir industry by making a major
contribution to the industry. Their constant drive to upgrade
quality standards in all areas of activity and all products has
enabled the company to acquire a dominant position in the
foreign market.
The company is now thinking to launch their products in the local
market by keeping in view the benefits they will get by their
entrance in the local market. Company also have a high future
growth and maintains good quality on the products they are
manufacturing.
13. BIBLIOGRAPHY
1. Kothari C.R, Research Methodology, Vishva Prakashan
Pvt.Ltd.New Delhi.
2. Pandey I.M, Financial Management, Vikas Publications
House, 7th Edition.
www.dcmills.com
www.coirboard.com
www.coirindia.com
www.coirkerala.com