Project Repot(M.M.ZUHEB.P2009)

CHAPTER: I

INTRODUCTION

1.1 TELECOMMUNICATION

Telecommunication is so vital to our lives, to our ability to compete in business, and to

our access to the political process. The Telecommunication industry is a system of

switches and lines that interconnected to provide communication between multiple

parties. The concept of universal service has thus for only been applied to basic telephone

service.

1.2 TELECOMMUNICATION - MEANING

Telecommunication is the assisted transmission of signals over a distance for the

purpose of communication. In earlier times, this may have involved the use of smoke

signals, drums, semaphore, flags, or heliograph. In modern times, telecommunication

typically involves the use of electronic transmitters such as the telephone, television,

radio or computer. Early inventors in the field of telecommunication include Antonio

Meucci, Alexander Graham Bell, Guglielmo Marconi and John Logie Baird.

Telecommunication is an important part of the world economy and the

telecommunication industry's revenue has been placed at just under 3 percent of the gross

world product.

1.3 EARLY TELECOMMUNICATIONS

Early forms of telecommunication include smoke signals and drums. Drums were

used by natives in Africa, New Guinea and South America whereas smoke signals were

used by natives in North America and China. Contrary to what one might think, these

systems were often used to do more than merely announce the presence of a camp.

In the middle ages, chains of beacons were commonly used on hilltops as a means

of relaying a signal. Beacon chains suffered the drawback that they could only pass a

single bit of information, so the meaning of the message such as "the enemy has been

CMR CENTER FOR BUSINESS STUDIES, BANGALORE

1

sighted" had to be agreed upon in advance. One notable instance of their use was during

the Spanish Armada, when a beacon chain relayed a signal from Plymouth to London.

In 1792, Claude Chappe, a French engineer, built the first fixed visual telegraphy

system (or semaphore line) between Lille and Paris. However semaphore suffered from

the need for skilled operators and expensive towers at intervals of ten to thirty kilometers

(six to nineteen miles). As a result of competition from the electrical telegraph, the last

commercial line was abandoned in 1880.

Homing pigeons have occasionally been used through history by different

cultures. Pigeon post is thought to have Persians roots and was used by the Romans to aid

their military. Frontinus said that Julius Ceasar used pigeons as messengers in his

conquest of Gaul. The Greeks also conveyed the names of the victors at the Olympic

Games to various cities using homing pigeons. In the early 19th century, the Dutch

government used the system in Java and Sumatra. And in 1849, Paul Julius Reuter started

a pigeon service to fly stock prices between Aachen and Brussels, a service that operated

for a year until the gap in the telegraph link was closed.

1.4 TELEGRAPH AND TELEPHONE

The first commercial electrical telegraph was constructed by Sir Charles

Wheatstone and Sir William Fothergill Cooke and opened on 9 April 1839. Both

Wheatstone and Cooke viewed their device as "an improvement to the [existing]

electromagnetic telegraph" not as a new device.

Samuel Morse independently developed a version of the electrical telegraph that

he unsuccessfully demonstrated on 2 September 1837. His code was an important

advance over Wheatstone's signaling method. The first transatlantic telegraph cable was

successfully completed on 27 July 1866, allowing transatlantic telecommunication for the

first time.

The conventional telephone was invented independently by Alexander Bell and

Elisha Gray in 1876. Antonio Meucci invented the first device that allowed the electrical


2

transmission of voice over a line in 1849. However Meucci's device was of little practical

value because it relied upon the electrophonic effect and thus required users to place the

receiver in their mouth to “hear” what was being said. The first commercial telephone

services were set-up in 1878 and 1879 on both sides of the Atlantic in the cities of New

Haven and London.

1.5 TELEPHONE

The telephones play a major role in communicating in this era. The telephone

are of multipurpose and are not restricted to just communicating any more. Alexander

Graham Bell patented the telephone in 1876 and formed bell telephone which licensed

local telephone exchange in major US cities. AT&T was formed in 1885 to connect the

local bell companies when the telephone was first invented, not everyone appreciated its

importance. In fact, western union was at first offered the patent to this invention but they

refused it.

It is expensive to maintain local telephone services with all the wiring and plant that

must be maintained. Long distance services with all the wiring and plant that must be

maintained. Long distance services, on the other hand, are much less expensive to provide

most of it is now carried by microwave and other technologies which are less expensive

to operate so a number of public policy issues emerge with regard to subsidization,

supposed completion and telephone rates

Optical fiber provides cheaper bandwidth for long distance communication. In an

analogue telephone network, the caller is connected to the person he wants to talk to by

switches at various telephone exchanges. The switches form an electrical connection

between the two users and the setting of these switches is determined electronically when

the caller dials the number. Once the connection is made, the caller's voice is transformed

to an electrical signal using a small microphone in the caller's handset. This electrical

signal is then sent through the network to the user at the other end where it is transformed

back into sound by a small speaker in that person's handset. There is a separate electrical

connection that works in reverse, allowing the users to converse.

1.6 FIXED-LINE TELEPHONES


3

The fixed-line telephones in most residential homes are analogue — that is, the

speaker's voice directly determines the signal's voltage. Although short-distance calls may

be handled from end-to-end as analogue signals, increasingly telephone service providers

are transparently converting the signals to digital for transmission before converting them

back to analogue for reception. The advantage of this is that digitized voice data can

travel side-by-side with data from the Internet and can be perfectly reproduced in long

distance communication (as opposed to analogue signals that are inevitably impacted by

noise).

1.7 MOBILE PHONES

Mobile phones have had a significant impact on telephone networks. Mobile

phone subscriptions now outnumber fixed-line subscriptions in many markets. Sales of

mobile phones in 2005 totaled 816.6 million with that figure being almost equally shared

amongst the markets of Asia/Pacific (204 m), Western Europe (164 m), CEMEA (Central

Europe, the Middle East and Africa) (153.5 m), North America (148 m) and Latin

America (102 m). In terms of new subscriptions over the five years from 1999, Africa has

outpaced other markets with 58.2% growth. Increasingly these phones are being serviced

by systems where the voice content is transmitted digitally such as GSM or W-CDMA

with many markets choosing to depreciate analogue systems such as AMPS.

1.8 DEVELOPMENT IN THE TELEPHONE

There have also been dramatic changes in telephone communication behind the

scenes. Starting with the operation of TAT-8 in 1988, the 1990s saw the widespread

adoption of systems based on optic fibres. The benefit of communicating with optic fibres

is that they offer a drastic increase in data capacity. TAT-8 itself was able to carry 10

times as many telephone calls as the last copper cable laid at that time and today's optic

fibre cables are able to carry 25 times as many telephone calls as TAT-8.

This increase in data capacity is due to several factors: First, optic fibres are

physically much smaller than competing technologies. Second, they do not suffer from

crosstalk which means several hundred of them can be easily bundled together in a single


4

cable. Lastly, improvements in multiplexing have led to an exponential growth in the data

capacity of a single fibre.

Assisting communication across many modern optic fibre networks is a protocol

known as Asynchronous Transfer Mode (ATM). The ATM protocol allows for the side-

by-side data transmission mentioned in the second paragraph. It is suitable for public

telephone networks because it establishes a pathway for data through the network and

associates a traffic contract with that pathway. The traffic contract is essentially an

agreement between the client and the network about how the network is to handle the

data; if the network cannot meet the conditions of the traffic contract it does not accept

the connection. This is important because telephone calls can negotiate a contract so as to

guarantee themselves a constant bit rate, something that will ensure a caller's voice is not

delayed in parts or cut-off completely. There are competitors to ATM, such as

Multiprotocol Label Switching (MPLS), that perform a similar task and are expected to

supplant ATM in the future.

1.9 HOME NEED COMMUNICATIONAL EQUIPEMENT

Today home owners expect their homes to accommodate the following items.

1. Multiple phone lines

2. Internet service

3. Video distribution and other services

4. Data and security services

5. Fax machines and the list goes on….

.

1.10 TELECOM MARKET IN ASIA


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The Asia telecom market is of large scale and great investment potential. Four

markets are developing fastest in Asia. They are China, Indonesia, India and Vietnam

meanwhile, in the markets of Japan, South Korea, Hong Kong and Singapore, handsets

have a high market Penetration.

1.11 TELECOM MARKET IN INDIA

India has a mere 1.2 telephones for every 100 of its people. This is way below

international standards and is not becoming of a country aspiring to be major player in the

global economy of the 21 century.

The telecom industry is developing the fastest among all sectors in India. Mean

while, GSM mobile communication is in the leading position in development of telecom

market in the next few years, hand set subscribers will be expanding dramatically with an

expected growth rate of more than 50%. The figure will add upto 200 million in 2008,

accounting for 75% of all telecom subscribers. In the past 5 years, the number GSM

handsets users increasing 10 times. In virtual of great market potentials ITI LTD will take

a shorter time than expected for consumers to exceed 100 million.

6.1 OBJECTIVE OF THE STUDY

The project is mainly consists of two folded objectives i.e., main objective and other objectives. The main objective is to acquire as much knowledge as possible from the industry side. The other objective is to find the one basic problem & give in suggestion to the organization.

1. To study the general information about the Telecommunication and history of

telephone.

2. To focus the origin and growth of the ITI Limited

3. To study the SWOT aspect of the company

4. To analyze the problems of the Finance Department

5. To make suggestions To solve the problem

CHAPTER: II


6

A PROFILE OF ITI LIMITED

2.1 ORIGIN OF ITI

The history of ITI goes back to the year 1948 when it was set up as a departmental

undertaking of the Government of India. Subsequently it was incorporated as a Company

on the 25th January 1950. ITI has the distinction of being the first post-independence

Public Sector Enterprise in India. The factory was located in a small village near

Bangalore. It consisted of a single production shop for the assembly of 25000 lines of

stronger exchanges and 25000 telephone instruments per annum from imported

components. From such small beginnings, the company has to-day grown into a

mammoth multi-unit industrial complex with expertise in the field of designing marketing

servicing and producing the total range of telecommunication equipment catering to the

needs of P&T, Railway, BSNL, Defence and other customers.

2.2 GROWTH OF ITI

ITI Limited is India's pioneering venture in the field of telecommunications.

Established in 1948, this premier PSU has contributed to 50% of the present national

telecom network. With state-of-the-art manufacturing facilities spread across six locations

and a countrywide network of marketing/service outlets. In the time span of more than

three decades since its inception, the company has witnessed phenomenal growth and ITI

has emerged as the leader in the telecommunication industry contributing a variety of

equipment to the telecommunication network of the Country. The largest manufacturing

complex of ITI has a R&D unit and two factories manufacturing transmission equipment

and telephone instruments. In Rae Bareli, ITI has two factories manufacturing electro-

mechanical step-by-step Stronger witching equipment and Crossbar switching equipment.

In Palghat, ITI has a factory manufacturing electronic switching equipment of ITI’s own

design. In Srinagar, ITI has a factory assembling telephone instruments and other related

spares.


7

The Company has a strong in house R&D infrastructure attached to the

independent business group. The main R&D divisions are at Bangalore and Naine.

Forward looking at technology the R&D is engaged in continuous development and

absorption of technology.

The company lays a strong emphasis on Strong emphasis on Quality, which taken

as a corporate Management Function under a independent executive Director Reporting

to chairman and Managing director a large number of company’s products are covered

under the “Self Certification scheme” by the major’s customer i.e. Department of

Telecommunication International Quality Management system the company has adopted

ISO 9000 taking it as a “Toll for Organizational change and work redesign Human

Resource development is another trust in a company involving professional and

organizational development activities.

The company is dealing with diverse technologies continuously phasing out old

technologies and phasing in new technologies Prominent foreign technologies currently

under manufacture include digital switching system OBC 283 under collaboration from

Alcatel France, Digital Microwave Systems under collaboration from NKT, Denmark and

Digital coaxial System under collaboration from AT&T Philips Holland center for

development of Telematics(CDOT)has also provided indigenous technology for

manufacture of Rural Automatic Exchange(RAX) and Main Automatic Exchange

PICTURE 2.1


8

OVERVIEW

2.3 BASIC INFORMATION ABOUT ITI

NAME : ITI LIMITED

ESTABLISHED : 1948

CORPORATE OFFICE : Dooravani Nagar, Bangalore

MANUFACTURING PLANTS : Four

CORE R&D : Bangalore

INSTALLATION & MAINTENANCE : Bangalore

REGIONAL OFFICES : Six (6)

AREA OFFICES : Forty Two (42)

QUALITY SYSTEM : ISO 9000

JOINT VENTURE : Three (Indian Sitcom Ltd., ITI

Comm. Pvt. Ltd., Fibcom Ltd.)

ISO ACCREDITATION : 10 Divisions


9

COMPANY WEB SITE : www.itiltd-india.com

LOGO :

2.4 ITI TODAY

With state-of-the-art manufacturing facilities spread across six locations and a

countrywide network of marketing/service outlets, the Company offers a complete range

of telecom products and total solutions covering the whole spectrum of Switching,

Transmission, Access and Subscriber Premises equipment. In tune with the technology

trend, it has embarked on manufacture of mobile infrastructure equipment based on GSM

(Global System for Mobile) technology. ITI has also acquired the technology for

manufacture of broadband infra equipment, NGN (New Generation Network) equipment

based on IP technology and SDH (Synchronous Digital Hierarchy) products. ITI has a

dedicated Network Systems Unit for carrying out installation and commissioning of

equipment as well as for undertaking turnkey jobs and providing value-added services.

The successful completion of the mammoth strategic communication network ASCON

for the Indian Army underlines ITI's ability in standing up to the challenge of enhancing

the reach of communication and information seamlessly over diverse media. In a fitting

testimony, the Company continues to hold the numerous Uno position as India's top

telecom turnkey solutions provider.

ITI joined the league of world class vendors of GSM technology with the

inauguration of mobile equipment manufacturing facilities at its Mankapur and Rae

Bareli Plants which opened a new era of indigenous mobile equipment production in the

country. These two lines will augment the capacity to more than nine million lines for

catering to both domestic as well as export markets.


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http://www.itiltd-india.com/

By deploying its rich telecom expertise and vast infrastructure, the Company is

consolidating its diversification into ICT (Information and Communication Technologies)

space to hone its competitive edge in the convergence market. Network Management

Systems, Encryption and Networking Solutions for Internet Connectivity are some of the

major initiatives by the Company. ITI's competency in the WAN (Wide Area

Networking) segment is reflected through two major projects commissioned successfully

for BSNL; countrywide MLLN (Managed Leased Line Network), VoIP (Voice over

Internet Protocol) and the nation's first broadband network IP-MPLS (Internet Protocol-

Multi Protocol Label Switching) technology based VPN (Virtual Private Network) in ten

major cities. The Company has struck a strategic alliance with BSNL for building a V-

SAT based network in Ku band for IP-based satellite broadband services. The successful

implementation of the project to expand Internet Services equipment of MTNL is a

significant step. The CDMA-WLL (Wireless in Local Loop) turnkey project that ITI has

completed for TCIL (Telecommunications Consultants India Limited) in Afghanistan is a

boost to the Company's export business.

Secure communications is the Company's forte with a proven record of

engineering strategic communication networks for India's Defense forces. Extensive in-

house R&D work is devoted towards specialized areas of Encryption, NMS, IT and

Access products to provide complete customized solutions to various customers.

2.5 VISION


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“To be the leader in the domestic market and an important global player in

Voice, Data and Image communications by providing total solutions to customers, To

build on core competencies to enter new business areas”.

ITI will be perceived by their customers as the leading business partner for

providing total network solutions.

It will offer innovative solutions using leading technologies in a

cost competitive manner, to help customer achieve their business

objectives. It will pursue new opportunities arising form the

convergence of Information, Communications and

Entertainment businesses.

It will enhance shareholder value and will move up the value chain by

expanding knowledge-based and service based businesses while

simultaneously leveraging over manufacturing business.

In this manufacturing business, it will continuously drive down costs.

It will leverage our telecom domain knowledge to build a telecom

software business in India catering to global requirements.

It will apply R&D efforts in focused areas.

It target customers will primarily be large organizations (both Government

and private sector) in India and overseas markets.

For exports, it will primarily target developing markets.

It will form strategic alliances with equipment/technology suppliers and service providers

to access technology and markets and to help them

Provide total solutions.

It will build a customer-focused organization and will invest in regular

training and development of our manpower for achieving the same.

It will transform ITI into a creative, livewire, entrepreneurial enterprise

with a quest for growth and with shared values.

2.6 MISSION:-


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“To establish leadership in manufacturing and supply of new technology

telecom products and also to retain status of top turnkey solution provider.

To be the leader in the domestic market and an important global players in

voice, data and Image communication by providing total solutions to

customers, on core competencies to enter new business areas.”

2.7 ITI’s MOTO

We will be perceived by our customers as a reliable business partner for providing total

telecom and IT solutions.

Our strategic allowances with technology partners will aim at offering solutions

using leading technologies in cost competitive manner.

Our relationship with technology and business partners will be winning and

extend to developing ITI as hub for manufacture, software development and ITI LTD

services.

Our marketing and R & D efforts shall be revitalized to seize the vast

opportunities in various segments in this era of convergence.

We shall strive for continuous growth through

Effective quality system.

Time and cost conscious.

Enhanced value addition.

Empowered human resources.

Teamwork.

Innovation.

Continuous improvement, mutual respect, transparency and shared values shall be

our guiding philosophy.

2.8 ITI’s AIM


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Regain states as largest indigenous manufacture of telecom equipment and

consolidate in new technologies.

Sustain ITI states of top turnkey service provider of the country in

Telecommunication.

Respect both internal and external customers

No liquidated damages.

Reducing cycle time from dispatch to realization.

Work like a team

2.9 ACHIEVMENTS AND AWARDS

1. Three plants of ITI (Rai Bareli, Palakkad and Bangalore) have won the National

Safety Awards for outstanding performance in industrial safety during the year

2004.

2. Energy conservation Award: ITI Mankapur Plant which saved energy to the tone

of Rs.384 lakhs during the last 3 years has won the National Energy Conservation

Award 2004.

3. ITI has received the prestigious ISO 9001-2000 certificate for its excellence in

product quality.

4. ITI has also won `ASCON’ award which was presented by Shri P.V Narasimha

Rao

5. Awards won by ITI quality circle:

6. ITI annual quality circle convention 1966, Bangalore plant won the 1st prize

7. ITI won the third prize in Fifth annual quality circle convention 1991.

8. Sixth annual quality convention1992, Bangalore won the first prize.

Confederation of Indian industry 10 state level quality circle competition

awards ITI won first prize in the year 1997-98


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2.11 QUALITY POLICY OF ITI

ITI is committed to providing products and services of consistent quality

that will lead to customer delight.

ITI will maintain leadership in the market with competitive prices and

Professional excellence through:

a) Implementation of sound quality management system.

b) Continuous innovation.

c) Continual improvement in every activity.

Involvement of people at all levels internally and externally.

2.12 BOARD OF DIRECTORS

Shri S.K. Chatterjee - Chairman & Managing Director

Shri Tejbir Singh - Director (Marketing)

Shri K K Khurana - Director (Human Resources)

Shri B P Gupta - Director (Finance)

Shri Ravi Agarwal - Director (Production)

Lt.Gen. S.P. Sree Kumar, AVSM - Director

Shri A.K. Srivastava - Director

Shri C.K. Koshy -Special Director

Shri K.T.Mayuranathan - Company Secretary

2.13 OVERVIEW OF ITI


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Corporate head quarters: ITI BHAVAN, DOORAVANINAGAR,

BANGALORE - 560 016

Manufacturing units

1. Bangalore

2. Naini (near Allahabad-UP)

3. Rae Bareli (UP)

4. Mankapur (UP)

5. Palakkad (Kerala)

6. Srinagar (Jammu & Kashmir)

Network system unit: Bangalore

Regional offices: New Delhi, Bangalore, Kolkata, Lucknow ,

Mumbai, Chennai, Hyderabad, Bhubaneshwar, Bhopal,

Ahmadabad, Kochi

: supported by 36 Area offices all over the country

Manpower: 13,013

R&D base: Bangalore, Naini, & Mankapur

Quality system: ISO 9000 compliant

2.14 INFRASTRUCTURE & FACILITIES


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PHYSICAL SETUP

• In-house R & D

• Network System Unit capable of undertaking turnkey jobs

• Self contained component evaluation centre

• Fully automated assembly lines

• In circuit tester (ICT)

• PCB manufacturing facilities

• Modern Chemical, Metallurgical Labs

• Mechanical fabrication/Machine shops with modern CNC machines

• Molding & Die casting

• Full fledged state of the art tool rooms

• SMT (Surface mount technology)

• Environmental testing

• Component approval center approved by Department of

Telecommunications.

• ISO 9000 compliant Quality Management Systems

2.15 LOCATION OF MANUFACTURING UNIT, REGIONAL OFFICE

AND CORPORATE OFFICE

For the easy and ministration purpose the company classify the offices in to three

types are manufacturing unit, regional office and corporate office. The complete details

are given in the map 2.1

MAP 2.1


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LOCATION OF MANUFACTURING UNIT, REGIONAL OFFICE AND

CORPORATE OFFICE

Map 2.2


18

REGIONAL OFFICES AND AREA OFFICES

2.16 BANGALORE PLANT

This is the first Plant of ITI set up in 1948. With its, vertically integrated, state-of-

the-art infrastructure a vast range of telecom products are manufactured. They include

digital switches (large, medium, small), Digital Microwave equipment, optic fiber

equipments, satellite communication equipment, access products, and terminal

equipments. The following picture shows the R&D department of Bangalore unit.


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PICTURE 2.2

RESEARCH AND DEVELOPMENT DEPARTMENT OF BANGALORE UNIT

The main R&D Centre is housed in this Plant.

The modern facilities available are Hybrid Micro circuits lab

Surface Mount Technology

Component approval and Vendor evaluation centre

Environment test lab

EMI Shielded chambers

Modern PCB plant

Metal parts , heat treatment , finishing , moulding and die casting shops

Fully fledged tool room

Modern electronic assembly/ testing facilities.

2.17 MAJOR COMPETITORS

X-PLOR TELECOM

IMCS Software Solutions

FIBCOM


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DVB

Sun Microsystems

PRODUCT PROFILE

Product division in Indian telephone Industries

Telephone Division

This division undertakes the production of telephones in ITI. The

telephone division assembles different modes of telephones. This division

manufactures around 5 lakes telephones every year. The sample picture of the

telephone is given below

PICTURE 2.3

ITI PRODUCT - TELEPHONE

Transmission Division


21

This division undertakes manufacturing of micro wave equipment

satellite communication equipment, optical fiber equipment and defense

products. Transmission division produces satellite products. The following

picture indicates the satellite.

PICTURE 2.4

ITI PRODUCT - SATELLITE

TERMINAL EQUIPMENTS

Telephones

Video conferencing

PICTURE 2.5

ITI PRODUCTS- DELTA

DELTA

PULSE/PHONE SWICTABLE TELEPHONE ALPHA(MODULAR)

s


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MAGENTO TELEPHONE

DESCRIPTION:

This telephone is a state-of-the-art of design to work with magneto

exchanges can also be used for point to point communications.

TELEPHONE SET 5C FOR THE DEFENCE

DESCRIPTION:

The telephone set 5C to ITI code 171CAA 01SL01 is rugged and designed to work as light weight telephone with a combination of 5B and 2A and also as a remote control telephone for simplex radio sets. The telephone set is compatible to work with CB and Magneto Exchanges in addition, telephone set 5C – can be used with an automatic exchange with the in-built push button

SALIENT FEATURES:

Improved speech performance (up to 40kms with WD1 cable)

Improved performance ringing sound by using pilzo electric buzzer instead

of conventional cell.

Modular design for each maintenance

Visual indications (led’s are provided) to indicate health and correct

insertion of calls

Hand ringing generator is replaced with a electronic ring generator


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Less weight and ragged mechanical design works on magneto and auto

mode.

PICTURE 2.6

ITI PRODUCT-

DESKTOP VIDEO CONFERNCING TABLE

PICTURE 2.7

PRESIDENT

EXECUTIVE TELEPHONE SYSTEM

The telephones are identical and interchangeable

Electric speech circuit with pulse / tone dialing

Flash button provided

Last number redial

Call holding from both secretary and executive without engaging exchange

line

Adjustable ringer volume

Music on hold

LED indication for power on incoming ring and exchange line status


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In case of power failure the 2 telephones parallel to exchange line

PRODUCTS:

SWICTHING

TRANSMISSION

DEFENCE

ACCESS PRODUCTS

RURAL

TERMINAL/SUBSCRIBER END PRODUCTS

INFORMATION TECHONLOGIES

MICROELECTRONICS AND SOFT WARE

PICTURE 2.8 ITI PRODUCTS

[switching]

Large Switches

Medium Switches

Small Switches

[transmission]

Microwave

Satellites


25

http://www.itiltd-india.com/satellite.htm

http://www.itiltd-india.com/microwave.htm


http://www.itiltd-india.com/switch_s.htm

http://www.itiltd-india.com/switch_m.htm

http://www.itiltd-india.com/switch_l.htm




[access]

Wireless in Local

Loop (WLL)

Digital Loop

Carrier (DLC)

Pairgain

[terminal

Sequipment]

Telephones

ISDN Products

Video

Conferencing

[microelectronics]

Application Specific Integrated Circuits

(ASICs)

[IT products]

Computer Telephony Integration (CTI)

[other products]


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http://www.itiltd-india.com/smps.htm

http://www.itiltd-india.com/cti.htm


http://www.itiltd-india.com/asics.htm



http://www.itiltd-india.com/videoconf.htm

http://www.itiltd-india.com/videoconf.htm

http://www.itiltd-india.com/isdn.htm

http://www.itiltd-india.com/telephones.htm



http://www.itiltd-india.com/pairgain.htm

http://www.itiltd-india.com/dlc.htm

http://www.itiltd-india.com/dlc.htm

http://www.itiltd-india.com/wll.htm







Bank Mechanizing Products

Fire Alaram

[DEFENCE]

0SCPC VSAT

Military EPABX 128 ports

LIST OF VARIOUS PRODUCTS MANUFACTURED IN ITI LTD

SWITCHING

A. Large switches

B. Medium switches

C. Small exchanges

D.EPABX

E.CTMX

F. Mobile communication

G.GSM

CTMX: Computerized trunk manual exchange.


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http://www.itiltd-india.com/military_epabx.htm

http://www.itiltd-india.com/scpc_vsat.htm


http://www.itiltd-india.com/firealaram.htm

http://www.itiltd-india.com/ccm.htm

http://www.itiltd-india.com/vadd.htm

PABX: Public access board exchange.

GSM:

ITI getting into providing GSM networks for cellular service.

Includes installation and commissioning backbone and other elements of network

GSM service offered:

1. Telecommunication services.

2. Bearer services- speech data, Fax.

3. Tele services- Emergency call, short service management.

Call waiting service.

Operate sub system (OSS)

Base station system (BSS)

Network switching system(NSS- data base and mobility mgmt)

Home location register

Visitor location register

Standard open register

Authentation center

TRANSMISSION

A. Microwave

B. Fiber optic

C. Satellite communication system

D.RADIO


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E. Digital multiplexer (TDMA- time division multiple access)

F.MCPC-Multiple channel per carrier (point to point star connectivity)

TERMINAL EQUIPMENTS /SUBSCRIBER END PRODUCTS

A. Basic Telephone models

B. Magneto

C. Boss secretary phones and ESPT (1+1)

D. Multimedia oriented telephones integration (MOTI)

E. Wide range of models for user

F. Video conferencing equipment latest technology

DEFENCE

A. Transportable satellite terminals with DAMA

B. Field telephone

C. Field auto telephone

D. Military EPABX 128 ports

E. Transportable hub and remote

F. Secure voice and data- For rural communication, high security voice and

data communication

ACESS PRODUCTS

Digital loop carrier (DLC)


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High bit rate digital subscriber line (HDSL)

WLL (wireless in local loop- cordect)

Cable server/digital pair gain

PICTURE 2.9

ACESS PRODUCT DIVISION:

This division undertakes the manufacturing of rural exchanges.

RURAL:

1. TDMA (time duration multiple access) - PMP (digital)

2. 10 channel digital line

3. Single channel radio relay

4. C-DOT RAX2

ITI SERVISES

ITI is exploiting the convergence of technologies by having ITI as the

nthrust area

ITI PROVIDES

Network solutions, integrated network management, E- commerce, voice

over IP telephony, call centre solution, information kiosks, CTI and IVRS.


30

OTHER PRODUCTS

Supervisory control and data acquisition (SCADA)

Switch mode power supply (SMPS)

Network management system (NMS)

Solar photo voltaic modules

64KBPS line drivers

Digital cross connect 16

APPCM

IPX PAD concentrator

Wave LAN

SCADA: control and analysis of real time data, LAN based control

remote terminals, data base management.

NMS: supervise, control, and monitor, maintenance telecom networks

Computer based- ITI’s intelin series.

Decentralized/centralized monitoring

WAVE LAN: Flexibility in connection of computers/nodes in LAN, wireless

connectivity, overcomes constrains space.

PRODUCT RANGE

ITI’s product range spans the entire spans the entire spectrum of

telecommunication equipment and includes:

1. Telephone instrument of various types

2. public Automatic Exchanges of Stronger and Crossbar types


31

3. PABXs and PAXs of Stronger and Electronic types

4. Teleprompter Exchanges(TELEX)

5. Long distance carrier equipment for overhead lines, paired and coaxial

cables

6. Frequency Modulated Voice Frequency Telegraph Equipment(FMVET)

7. Frequency Modulated speech plus Duplex Equipments(FMS+DX)

8. Pulse Code Modulated Equipment for Earth Station(GCE)

9. Microwave Equipment(MW)

10. Ground control Equipment for Earth Stations(GCE)

11. Transmission Equipment for Defence Equipment for Railway

Electrification Electronic Measuring Instruments

12. Telemetry and Telecontrol equipment

13. Automatic Road traffic signals

The companies’ product range includes all that it required to equip national

and international Telecommunication Networks staring with simple telephones to

state of the Art Digital Switching satellite communication and optical

communications systems.

Ninety five percent of the company’s products are supplied to the

department of telecommunication the other significant customers of the customers

of the company are defense and defense and Railways for who even special

turnkey projects has also been executed.


32

CHAPTER: III

ORGANIZATION STRUCTURE

3.1 ORGANIZATION STRUCTURE

An organizational structure defines how job tasks are formally divided, grouped

and coordinated. The chapter iii deals with the organizational structure; the organization

structure is a complete picture about the organization. The structure of an organization

plays a significant role in charting out its path to success. An efficient structure facilitates

coordination and smooth intertwining of employees and communication systems. The

organization adopts different structural pattern at different stages of its lifecycle. The

form of an organization that is evident in the way divisions, departments, functions, and

people link together and interact.

Organization structure reveals vertical operational responsibilities, and horizontal

linkages, and may be represented by an organization chart. The complexity of an

organization's structure is often proportional to its size and its geographic dispersal. The

traditional organization structure for many businesses in the 20th century was the

bureaucracy, originally defined by Max Weber.

3.2 BASIC ORGANISATIONAL STRUCTURE

An organization is a social entity composed of two or more persons who work

together towards the attainment of common goals. For the organization to work as a

cohesive unit, it is essential that a formal structure of reporting and control be established

among the different members of the organization....


33


34

CHART 3.1 ORGANIZATION CHART OF BANGALORE PLANT-


35

DR-P

AGM-B

AGM-I&C

CMD

DGM(IMM)TDP

AGM-TDP AGM-SAD

DGM-I&C

DGM-TS-TDP

DGM-TDP

DGM-SAP

DGM-SAP

DGM-F

DGM-F

DGM-CS

DGM-QA

DGA-Shipping

DGM-HR&V

DGM-BD&Mktg

DGM-

SAP(AMC)

DGM-IT

DGM-Tech

DR-F

DGM-P-SD

CHIEF MANAGERS

MANAGERS

DEPUTY MANAGERS

ASST.MANAGER

ENGINEERS

WORKERS

CHIEF MANAGERS

MANAGERS

DEPUTY MANAGERS

ASST.MANAGER

ENGINEERS

WORKERS

CHIEF MANAGERS

MANAGERS

DEPUTY MANAGERS

ASST.MANAGER

ENGINEERS

WORKERS

CHIEF MANAGERS

MANAGERS

DEPUTY MANAGERS

ASST.MANAGER

ENGINEERS

WORKERS

CHIEF MANAGERS

MANAGERS

DEPUTY MANAGERS

ASST.MANAGER

ENGINEERS

WORKERS

3.3 TOP LEVEL MANAGEMENT

From GRADE 5 OFFICER TO GRADE 10 OFFICER i.e., From Chief

Manager to Chairman & Management Director (CMD).

3.4 MIDDLE LEVEL MANAGEMENT

From GRADE 1 OFFICER TO GRADE 4 OFFICER i.e., From Executive

Engineer to Manager.

3.5 LOW LEVEL MANAGEMENT

Below GRADE 1 Officer i.e., all Non –Officers.

3.6 HIRERCHIAL LEVEL

As the organization is Horizontal in nature so structure shows us that from

TOP LEVEL MANAGEMENT to LOW LEVEL MANAGEMENT

All Non – Officers has to report to GRADE 1 Officer.

Grade 1, Grade 2, & Grade 3 Officers has to report Grade 4 Officer.

Grade 5 Officer to Grade 9 Officers has to report Grade 10 Officer.


36

Chapter: IV

an Overview OF Departments

This chapter contains the information about the various departments in the company. The

following of the m are the departments of the company.

1. Production Department

2. Human Resource Department

3. Finance Department

4. Marketing Department

5. Research and Development Department

6. Purchase department

4.1 PRODUCTION DEPARTMENT

Production department performs the function of producing finished goods from

the basic raw materials. He manufacturing is headed by a group head whose main

objective is to plan, execute, co-ordinate and control all production activities with

available resources, inputs, equipment, and facilities.

Quality control department is attached with the production department of each

division. It keeps check with quality manufactured with that of the standards set up by the

customers. It detects the bad items and makes necessary improvements in order to prevent

its occurrences in the future.

OBJECTIVES

To ensure, direct and co-ordinate the activities.

To ensure Quality output.

Provide a durable output with least cost

Ensure a desirable output as per client’s requirement.


37

FUNCTIONS

To prepare detailed production plan in consultation with general

Manager which must be consistent with company’s production objective

To prepare detailed raw materials plans and ensure the incoming

Quality standards and their proper usage.

Receiving of raw materials and packaging of final products.

Integrated production efforts with proper maintenance to ensure implementation

of production and maintenance schedules and to avoid break downs by helping

maintenance under take jobs on time basis etc. the information is given in the

chart 4.1

Provide a prompt delivery of finished goods on time to serve customers in a

better way.

Proper utilization of resources like raw materials, stores materials, machinery &

equipments etc

Materials should not be wasted in the production house , it may lead to a loss of

material & profit also.

Provide a least cost products to its customers

Continuous improvement of process & people to increase efficiency level.


38

Chart 4.1

WORK FLOW MODEL (End to end)


39

4.2 HUMAN RESOURCE MANAGEMENT:-

Human Resource Management is planning, organizing, directing,

and controlling of procurement, development, compensation, integration and

maintenance of human resources for the purpose of contributing to the

organizational, individual, and social goals.

HRM is management functions that helps manager’s recruit, select,

train and develop members for an organization. Obviously HRM is

concerned with the people’s dimension in organizations. It ensures that

employees are valued more than any asset in the organization. It looks after

the employees and ensures that they give out their best at the work place.

This department ensures that the right person is selected for the right job.

Human resource management is the effective control and use of man

power as distinguished from other sources of power.

Human resource executive mainly look after employees mainly their

problems. This department performs the functions like Recruitment,

Selection, Training and Development.

ITI, Bangalore has 210 employees.


40

FUNCTIONS OF HUMAN RESOURCE DEPARTMENT:

In ITI HR functions are to provide training and development programs to

officers and non-officers and to provide training to all personnel with in the plant to

enhance their skills to carry out the assigned job effectively and also develop human

resources to achieve organizational objectives HR functions are evaluated through

the identification of training needs, while identifying training needs of individuals

and functional groups the training programs should by job oriented and relevant to

the current trends in appropriate technology besides creating quality awareness and

providing necessary motivation for achieving the objectives of the industry.

TRAINING NEEDS ASSESSMENT

Internal and External training

Apprenticeship training

Human Resource activities based on the need of the organization

and employees

Time office

Promotion

Recruitment

Transfer

Wage and Salary administration

Personnel administration

Disciplinary actions

Grievances Handling

Performance appraisal


41

FIGURE 4.1

FUNCTIONS OF HR MANAGER:


Employee

Motivation

Employee Hiring

HR

MANAGER

Employee Remuneratio

n

Performance

Appraisal

Employee

Maintenance

Industrial

Relation

42

HUMAN RESOURCE TRAINING AND DEVELOPMENT IN ITI

A separate human resource development was introduced exclusively for the

Bangalore plant in 1990, with a view to with stand or to face the threats caused by

huge mass of employees facilities concentrated training program, up dated latest

technique, methodologies to encourage and train the apprentices and internal

employees.

Training needs area identified on the basis of organizational analysis, job

analysis and manpower analysis. Training programmer, training methods and

course content are to be planned on the basis of training needs.

The training programmers commonly used in ITI includes both on-the-job

training like apprentice training, job instruction, job rotation and in off the job

method it includes lecture method, audio visual and programmes instruction.

Following which are involved in Human Resource Department

Human Relations Department

Public Relations Department

Legal Department

HUMAN RELATIONS DEPARTMENT

This is an important department which deals with the administrative

authority benefits bifurcating the whole department into six groups:

Terminal benefits

Disciplinary action group

Medical group

Wage and salary administration group


43

Record section

Miscellaneous group

TERMINAL BENEFITS

This particular group deals with the matters related to

settlement of terminal benefits for resignations, superannuating, death, voluntary

retirement service cases scheme for exertion amount and the officers journal audit

for employment on medical grounds, refund of security deposits etc.,

DISCIPLINARY ACTION GROUP

This group indicates work related to allied matters, absenteeism,

memos referring for medical benefits, misbehavior with superiors and theft cases.

MEDICAL GROUP

This group concentrates on cases of receiving and processing of

medical bills and allied matters, pre auditing of medical bills, verifications of

family declaration form and clarification of medical reimbursements bills.

WAGE AND SALARY ADMINISTRATION GROUP

This department focuses on the matters related to wage

administration, payment of wage and salary to employees, fixation of pay on

transfer encashment issues of certificates, nomination for gratuity, leave matters,

hospitalization and maternity leave, compensation, reimbursement etc.,

RECORD SECTION

This section consists of personal record of the employees as regard

theirs age, qualification, experience etc., It also deals with record of employees

working at present in the organization and the ex-employees. They maintain the

records in two ways manual and computerized.


44

MISCELLANEOUS

This group deals with conveyance allowance, transport allowance,

special leave for blood donation, higher education etc.,

PUBLIC RELATION DEPARTMENT:-

It is only in the 20th century that public relation came to be codified,

formalized and practiced as a profession. Actually, it is as old as the human race. Every

organization, institution and industrial has public relation whether or not the fact is

recognized. As long as there are people living in communities, working together in

organization and forming a society, there will be an intricate web of relationships among

them.

The public relation department is headed by the chief manager and is

responsible for the following functions:

FUNCTIONS

Advertising and sales promotion.

Bringing out house journals

Participation in exhibition and display

Maintaining and improving media relations.

Extending hospitality by making arrangements for VIP (very important persons)

visitors.


45

LEGAL DEPARTMENT:-

INTRODUCTION

Legal department is responsible for representing the company in legal matters.

OBJECTIVES

1. Prevention and settlement of industrial disputes.

2. Represent the company in the court of law.

3. File cases against external parties.

FUNCTIONS

The department is to under legal opinion or advice on matters referred from various

departments of the company. On subjects varying from purchase, recruitment and

serviced matters to contract and commercial transactions.

TYPES OF CASES

Civil cases

Labour cases

High court cases

A.CIVIL COURT:

Civil court deals with civil matters i.e. Public related issues.

Civil court again subdivided into:

a. Family court: related all family matters.

b. Motor vehicle court: motor vehicle accident(Between supplier and

company)

B. LABOUR COURT:


46

This court deals with all labour related matters.

Ex; dismissal from service, disobey, theft, demands by

union (salary, reimbursement etc.)

I.e. a. dispute between management and labour

b. union and union representative

Before the labour court the case is handled by the state labour commissioner for

the consolation (company management, employee and labour commissioner sit together)

C. HIGH COURT AND SUPREME COURT

Any one party is dissatisfied by the judgment of both civil and labour court

they can go for the high court for justice. The decision of the Supreme Court will be the

last decision.

Charges are to be different for different courts. Supreme Court charged high

price than any other court.

MAN POWER PLANNING:-

Man power planning is the process of determining the quantity and

quality of manpower required for an organization, and ensuring the supply of the

required type of manpower in right quantity at the right place and at the right time

for the achievement of the goals of the organization. It is process by which the

management of an enterprise ensures that right type of personnel are available in

right numbers at the right place and at the right time for doing the right things for

which they are most suitable.

1. Manpower planning is undertaken not only when talent is in scarcity but

also when it is in surplus.

2. MPP is intended to ensure the availability of right personnel in right


47

numbers at the right places and at the right time for the achievement of the

organizational goals.

3. MPP is a comprehensive process. It includes all the aspects of

Manpower Management. To be specific, it is concerned with the determination of

the manpower requirements of the organization in advance, the analysis of the

manpower available between the demand and supply of manpower.

4. MPP includes not only recruitment, selection, training and

Development of personnel but also takes into consideration the environment or

conditions under which the personnel work.

5. It is a continuous process.

FUNCTIONS

1. Recording and maintains of vacancies arising out of :- Retirement, death,

dismissal, transfer etc., category wise / department wise / division wise in

the respective registers.

2. Filling up of vacancies arising out of above way of :-

a. External recruitment/ Internal recruitment by raising staff

Requisition on recruitment section.

b. Transfer / redeployment within Bangalore complex and other

Units.

The above actions involves:-

i. Diarizing and processing of requests recognized by the divisional heads,

obtaining of approval from the management and raising the staff requisition

and also releasing orders after receipt of selection papers by recruitment

section.


48

ii. Diarizing and processing of individual and jointly representations/ request of

employee in respect of transfers with in Bangalore complex and unit / reg.

office and issuing of either transfer or regret memos.

iii. Processing of grievances connected with transfers.

iv. Processing of transfers individual / bulk on administration grounds due to

surplus management decision and also based on periodical manpower

analysis by each department/division.

v. Following and filling of duty reports in the concerned PF’s after effecting

transfers.

3. All typing work connected with the above subject and any other additional

work given by head of department.

Following which is involved in Manpower Planning

1. Manpower statistics

2. Recruitment

3. Transfers

4. Promotions

5. Maintains of records

TABLE 4.1


49

MANPOWER STATISTICS (as on 1st July of 2009)

UNITS TOTAL STRENGTH

Corporate Office 144

Bangalore Plant 1854

R & D, Bangalore 182

Network system unit 479

Raebareli 4002

Naini 2125

Mankapur 2229

Palakkad 656

Srinagar 166

Marketing 636

Total 12473

RECURITMENT PROCEDURE

SANCTION FOR CREATION OF POSTS

The statement of anticipated personnel requirements of all departments will

be prepared in the prescribed form in August / September for each year for

budgetary purposes. On approval of funds, the posts will be created on requisition

submitted by the various departments in the prescribed form:

SOURCES OF RECRUITMENT


50

Employment Exchange :( All Non – officers posts as per the compulsory

Notification of vacancies Act)

Advertisement : (All Officers)

Campus Interview : (All Officers)

Walk-in-Interview : (All Officers)

RESERVATION OF POSTS

Vertical reservation : SC – 15%, ST(Off-7.5% & Non-5%), OBC – 27%

Horizontal reservation : PH – 3% & Ex- servicemen – 27%.

PRINCIPLE GOVERNING RECRUITMENT

Merit, efficiency and competence will be the only consideration governing

recruitment.

ABSTRACT

1. Creation of posts

2. Justification from Industrial engineering department

3. Financial concurrence

4. Manpower & Policy

5. Staff Requisition

6. reservation

7. Sources

8. Screening

9. Test / Interview

10. Medical Examination


51

11. Offer of appointment

12. Induction / Joining duty

13. Placement

14. Police Verification

15. Previous Employer’s report

16. Referee report

17. Probationer’s confirmation report

18. Confirmation.

TRANSFERS

The transfers are made between the

1. Department to Department

2. Division to Division

3. Unit to Unit

If there is any work in one department and another department will not be having

any work then the Head of department will provide an letter about the requirement

of employees in that particular department. So, after accepting that letter by the

manager then the employees will be transferred to one department to another

department. Vice – versa in all cases.

Apart from these transfers there are some more transfers


52

1. REQUEST TRANSFERS: It is type of transfer where the employee will

provide

a request letter to transfer that employee it may be where.

2. ADMIN TRANSFERS: It is another type of transfer where one employee will

be transferred from one department to another within admin.

3. MUTUAL TRANSFERS: It is type of transfer where 2 employees agrees

to exchange their departments by mutual understanding.

4. REDEPLOYMENT TRANSFERS: It is one of the transfers where the

employees are

deployed according to the work or due to over

load of work.

PROMOTIONS

Upward reassignment given to the employee. It is an appraisal given by the

company for the service or for the performance rendered by the employee in the

organization.

Here in this organization the promotions are two types:

Officers : career planning

Non-officers : time bound promotion


53

TABLE 4.2

QUALIFYING SERVICE FOR THE PROMOTION

For promotion from Completed year of service in the existing

Grade as on 30th June of a year

LQ

(less qualified)

DQ

(diploma

qualified)

PQ

(professional

Qualified)

GR1 TO GR2 8 6 4

GR4 TO GR5 * 6 4

GR6 and above 3 years of service in existing grade.

PROMOTION SELECTION BASIS 1:3

The annual confidential record will be maintained by the company to check the

performance of the employee within the organization. The performance will be checked on

the following details :

Qualification

Attendance

Assessment Rating Scale

Work

Conduct

Potential (for Cat. G & H only)

Performance Rating.


54

Depending upon the above the company will give yearly marks for the promotion

Marks required for the promotion

General Employees: 74 marks

SC and ST : 66 marks

TIME SPAN FOR THE PROMOTION

Non- officers are divided by channel wise i.e. 1 to 7

Each channel has separate 5, 6 and 7 years time spans for the promotion.

Production - for promotion from PA to PH and to GR1 the service period is 5, 6 and 7

years the same duration is followed for the SA to SH and then GR1 officer.

(e) DEMOTIONS

Downward reassignment to an employee in the organization.

If the employee violates the policies, rules and regulations of the company he has demoted.

Criteria for the demotions are:

Late attendance

Sleeping on duty hours

Theft of company’s property

Having alcohol on duty hours

Selling goods inside the factory

Demotions are one of the disciplinary actions taken by the company against the

employees

WELFARE DEPARTMENT


55

Ever since its establishment in 1948, the Company has been the forerunner among

the Public Sector Enterprises in providing welfare benefits to employees. Among the

numerous statutory and Non statutory welfare benefits made available to nearly 2500

employees and over 8000 of their dependents. The following are contributing

significantly to employee satisfaction and their relatively higher standard of living .

EMPLOYEES WELFARE

Ever since in establishment in 1948, the company has been the forerunner among the

public sector enterprises in providing welfare benefits to employees. Among the

numerous statutory non statutory welfare benefits made available to nearly 2190

employees and over 8000 of their dependents. The following are contributing

significantly to employee satisfaction and their relatively higher standard of living.

SUBSIDISED FOOD WHILE AT WORK:

“Canteen runs departmentally to provide wholesome food-breakfast,

lunch, milk, tea and coffee to nearly 2190 employees on all working day at

highly subsidized rates”.

CANTEEN

The food supplied in the canteen is heavily subsidized. The cost of preparation of

various food items and the selling price, details of subsidy involved or given in the

statement given at annexure enclosed.

In a day, an adult industrial worker requires about 2000 calories of energy.The

menu in canteen as been standardized by the canteen managing committee to

cater to at least 2/3rd calories of requirement of the industrial worker. Thus during

his stay 8 hour in the factory, the food provided in the canteen meets the

requirement of the worker.


56

The canteen is well-organized and established which has been meeting the requirement

of food admirably, in view of plant and standard input of wholesome raw materials and

hygienic preparations.

No complaints regarding the function of the employees have made the canteen.

Occasional complaints if any is being rectified/corrective action can taken by the canteen

administration and the same is being discussed and communicated in the canteen

managing committee meetings.

TOWNSHIP

We have well established housing colony called ITI TOWNSHIP. The housing

and other facility provided to workers Is as detailed below.

NUMBER OF QUARTERS = 1676

A – Type – 17

B – Type – 34

C – Type – 154

D – Type – 505

E – Type – 946

Officers Suite - 20

Hostel Rooms – 98


57

Out of the 1656 quarters, 500 are in occupation by the executives/employees of

the company. We have also allotted nearly 1000 quarters to non-ITI employees

like army institute of fashion design, controller defence accounts, 515 army base

workshop, sitar, ASC centre, BESCOM, BMTC, CMC KR PURAM, ITI Vidya

Mandir, State Bank Of India, HAL, BSNL officials Karnataka Power Transmission

Corporation Limited, police officials and some other state/central government

officials on market rent.

The market rent charged for non ITI employees furnished below: The following

table shows the and b areas of quarters type and total rent

TABLE 4.3 Rent of different types of quarters in ITI ltd

‘A’ Area ‘B’ Area

QUARTERS TYPE TOTAL RENT TOTAL RENT

B 8500/- -

C 3500/- 4300/-

D 2500/- 2900/-

E 2000/- 2200/-

FACILITIES PROVIDED TO EMPLOYEES

1. HOSPITAL

2. SCHOOL

3. PLAYGROUNDS

4. AUDITORIUM

5. RECREATION CLUB

6. SPORTS CLUB

7. COMMUNITY HALL

8. TEMPLE


58

9. CO-OPERATIVE SOCIETIES

10. SHOPS

11. GENERAL PARK

12. LIBRARY

13. GUEST HOUSE

14. BANK

15. POST OFFICE.

16. TOWN SHIP

17. CANTEEN

18. QUARTERS

19. SUBSIDIZED TRANSPORTATION

20. SUBSIDIZED EDUCATIONAL FACILITIES

21. . FREE MEDICAL BENEFITS

22. . LEAVE TRAVEL CONCESSION

23. . SUBSIDIZED HOUSING SCHEME

24. . SOCIAL CO-OPERATIVE

25. PERSONAL DEVELOPMENT

26. RECREATIONAL FACILITIES

27. . ACCIDENT BENEFITS

28. . RETIREMENT BENEFITS

29. . SERVICE AWARDS AND SUGGESTIONS SCHEMES

30. . RAFI WELFARE FUND


59

4.3 FINANCE DEPARTMENT

INTRODUCTION

Finance is the life blood of the business, so in any organization the most

important department is the finance department. ITI also has an efficient department

for accounts and finance headed by finance controller. Finance department is

concerned with planning and controlling of the firms financial resources.

OBJECTIVE

Preparation of corporate plans, annual plans and budgets.

Financial planning cost control and ensuring uniform and correct observation of

financial discipline of the company.

Monitoring the progress of budget achievements.

Providing accounting service to all levels ensuring updating of systems procedures

for the same.

Advising management on funds utilization and its implementation.

FUNCTIONS

The main functions of the finance department are mainly including with financial

matters those are given below;

To make proper entries in books of accounts and extract reports like trial balance,

profit and loss account, balance sheet on a time bound basis.

Timely dispersant of salary, wages, perks to employees as per agreement or

memorandum of understanding etc.,

To ensure the distribution of funds to various departments to meet their

requirements

To conduct regular internal audit and hence curb misuse of funds


60

wage and salary administration payment of gratuity provident fund and loans to

employees all these functions are covered by finance department

FINANCE DIVISION

Finance as we all know is the life blood of any business, so is the case with ITI.

Since ITI is a manufacturing unit it requires cash or capital at every stage of product

development.

Finance is required for the purchase of raw materials, payment of wages salaries,

and purchase of fixed assets and so on.

Responsibilities of then finance and accounts organization

The finance and accounts organization of the company is responsible for following

functions

1. Raising of finances from appropriate sources to meet the short-term and long-term

requirements of the company and the control and allocation of such financial

resources to different units to ensure their optimum utilization

2. Scrutiny and evaluation of investment and other proposals for expenditure from

the financial angle using quantitative techniques relevant to the proposals

(discounted cash flows, incremental/differential costs, profitability etc) and

ensuring that the proposals and in accordance with the well-recognized canons of

financial properly.

3. Financial accounting which is concerned with the maintenance of accounting

records and books, production overhead financial statements, procedures for

safeguarding the assets of the company etc.

4. Cost and management accounting which is concerned with the production of cost

accounts and accounting information for management decision making and

control.

5. Preparation of capital and operating budgets and the operation of budgetary

control.


61

6. Internal audit which is concerned with the accuracy and integrity of financial

records, compliance with policies and procedures and independent appraisal of

operational areas as a service to management.

ORGANIZATIONAL UNITS FOR ACCOUNTING

For the proper discharge of the above functions the company is divided into distinct

accounting units, each such unit corresponding to an…..

Operating division

Central division or an R&D division,

Finance department is the major department in ITI comprising of various activities.

Share capital

Loan from government

Public deposit

Cash

Bank transactions

Purchase accounting in land

Services and miscellaneous bills payable

Purchase accounting foreign

Imp rest account and special advances

Material accounting stock and stores

Accounting of fabricating order

Social ancillary orders


62

Accounting for tools

Stock verification

Time keeping payroll personnel claim and advances

ESI scheme

Billing and account receivable

Regional office account

Contactor account

Gratuity

Taxation

PF account

Sales tax

Exercise duty

Accounting of shipping and clearance of office transaction

Finalization of account

Budget

Computerized accounting

Maintenance of records of various department which in accordance with the

generally accepted accounting principles

Reports to ministry

Inventory management


63

Debtors management

Budgets maintenance

Providing finance to units which are in distress

Finance function consists of 8 units, 4 units are located in Bangalore and other

units are located outside Bangalore. The finance function is fully centralized. The

whole authority is entrusted with the corporate office. The corporate office looks

after the financial aspects by following a 5 year plan and every unit of ITI is required

to prepare an annual plan specifying its requirements for the year.

Finance function is broadly divided into

Internal financing system

External financing system

INTERNAL FINANCING

It is basically followed through the system of financing through retained

earnings.

EXTERNAL FINANCING

Previously a major portion of finance was contributed by the government (particularly

fixed capital). But from 1986-87 government of India has stopped giving assistance as

such company was compelled to issue bonds with government guarantee, based on

rating of ICRA and CRISIL. These agencies arrange for finance.

ITI has raised 5 types of bonds A, B, C, D, E right from 1986 ‘A’ and ‘B’ has been

rapid. C, D, E are in the ratio of 20, 120, 94 crores repayable in 5 years with a call

option of 3 years.

PAY ROLL DEPARTMENT


64

INTRODUCTION

The preparation of monthly pay roll is an important activity of the

organization. Since salaries and wages are to be paid on due dates with out fail, it is

necessary to lay down strict time schedules for the completion of the different stages

of work in the preparation of pay rolls.

FUNCTIONS

Preparation of monthly pay roll in respect of:

A. Regular employees of the company.

B. Casual staff

C. Full time apprentices

D. Graduate or diploma trainees

Passing of accounting entries for pay and allowances and other payments

PAYMENT CONSISTS OF:

BASIC+DA+HRA+CCA+SERVICE WEIGHTAGE+SPECIAL PAY

DA - Dearness Allowance depends on prices of the commodities

(INFLATION)

HRA - House Rent Allowance 30% on basic pay.

CCA - City compensation Allowance depends on the city

Ex; A, B, C and D. Maximum 6% on basic or Rs.300/-.

SPECIAL PAY - Family Planning (only 2 children) Rs.250/-.


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Payment based on attendance. Both CTO (Central time office) and PAYROLL are

interrelated. They are like LOCK and KEY.

maintenance of employees wise accounts in respect of loans and advance made by

the company.

Final settlement of accounts payment of gratuity in respect of employees who

leave the service of the company.

Preparation of balance sheet schedules in respect of salaries and wages payable,

advances to employees, unpaid salaries or wages, miscellaneous liabilities etc.,

Table 4.4

PAY SCALES OF OFFICERS / NON- OFFICERS WEF01/01/1997

AND CORE R & D OFFICERS WEF 01/07/2001

NON – OFFICERS


OFFICERS

GR SCALE

1 655O 200 11350

2 8600 250 14600

3 10750 300 16750

4 13000 350 18250

5 14500 350 18700

6 16000 400 20800

7 17500 400 22300

8 18500 450 23900

9 20500 500 26500

10 23750 600 28550

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CAT SCALE

A0 3000 – 35 – 4750

A 3630 – 60 -5130

B 3730 – 65 4510 – 70 – 5420

C 3875 – 75 – 4775 – 85 - 5880

D 4040 – 90 – 5120 – 95 – 6355

E 4240 – 105 – 5500 – 115 – 6995

F 4460 – 120 – 5900 – 125 – 7525

G 4700 – 130 – 6230 – 140 – 8080

H 5100 – 155 – 6960 – 160 – 9040

GR CAT CORE R & D OFFICERS

DESIGNATION SCALE

2-4 A-C D – SCIENTIST 8600 – 250 – 10600 – 300 – 13300 – 350 – 18200

5-7 D-F C – SENIOR SCIENTIST 14500 – 350 – 15900 – 400 – 22300

8 G B – PRINCIPAL

SCIENTIST

18500 – 450 - 23900

9 H A - CHIEF SCIENTIST 20500 – 500 – 26500


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CENTRAL TIME OFFICE (C.T.O)

INTRODUCTION

Central Time Office is meant for maintaining the attendance and leave records of

the employees of the company. They will get all the inputs from EDP department

who is responsible for maintaining records electronically.

LEAVE PATTERN

OFFICERS

CASUAL LEAVE (CL) : 12 days/year.

PAY LEAVES (PL) : 30 days/year.

NON OFFICERS

CASUAL LEAVE (CL) : 15 days/year.

PAY LEAVES (PL) : 20 days/year.

SICK LEAVE (SL) : 5 days/year.

ATTENDANCE

A SHIFT - 6.15am to 2.15pm

B SHIFT - 2.15pm to 10.15pm

C SHIFT - 10.15pm to 6.15am

G SHIFT - 8am to 4pm

MAJOR DIVISIONS

The three major divisions which will work in all the shifts are as follows

Hospital.

Security.


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Canteen.

Due to the low orders all the employees will work in G Shift i.e. General Shift.

The refreshment will be given for the employees who will work in B & C Shift.

In B Shift employees will be given Rs.8 per hour.

In C Shift employees will be given Rs.10 per hour.

OVER TIME (OT)

There are two types of OT facilities given to the employees by the company for

their extra time work done by the employees.

Payment: The employees who work in the overtime they will be paid for how

many hours work done by that particular employee.

Comp Off basis: Here in this case if the employee stays after the shift given to him

then the may not provide him any payment but they provide a leave on any other day

when ever that employee needed.

CENTRAL FINANCE

PERFORMANCE

The performance of the ITI is given in the table 1.1 and 1.2. The two tables

indicate the growth of the company in the form of sales, production and profit/loss after

tax and growth in turnover.


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TABLE 4.5

PERFORMANCE OF ITI IN RUPEES

Performance from 2002 to 2007 in Rs. Crores

Year 2002-03 2003-04 2004-05 2005-06 2006-07

Sales(Incl. ED) 1794.65 1256.57 1389.01 1,749.38 1,818.33

Production 1689.37 1072.66 1362.22 1,607.20 1,797.05

Profit /Loss

After tax (374.87) (705.83) (309.82) (428.76) (405.26)

Growth

In turnover - - 10.54% 25.94% 3.94%

Source: Source: Annual Reports of ITI

TABLE 4.6

PERFORMANCE OF ITI IN US $

Performance from 2002 to 2007 in US $ Million (with exchange rate of 43.51/$ as on 31-03-2007)

Year 2002-03 2003-04 2004-05 2005-06 2006-07

Sales(Incl. ED 412.47 288.80 319.24 402.06 417.91

Production 388.27 246.53 313.08 369.39 413.02

Profit /Loss

After tax (86.16) (162.22) (71.21) (98.54) (93.14)

GrowthIn turnover - - 10.54% 25.94% 3.94%

Source: Annual Reports of ITI


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4.4 MARKETING DEPARTMENT

INTRODUCTION:-

It is one of the important departments of ITI. The corporate marketing

department was formed in the year 1995.Before both the functions of marketing and

sales were carried out by only one department. The department is not made in charge

for undertaking promotional activities such as advertising, creating demand etc.,

only the corporate body of the ITI will take these actions. The marketing department

only looks after some of the functions.

FUNCTIONS

Product, including consideration of packaging and branding

Pricing of the product.

Physical distribution including distribution channels, warehousing and

transportation.

a. To identify target markets and it’s needs.

b. To promote the needs of the products of the company.

c. To be a competitor in the world of the telecommunications

d. To maintain good marketing for their products

But some of the above functions are undertaken by the marketing department

on the rules and policies of the corporate body only.


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INDIAN CUSTOMER PROFILE:

Department of Telecommunications (DoT),Government of India

BSNL

Mahanagar Telephone Nigam Ltd

Defence Services

Paramilitary, Police &

Internal Security organizations

Power, Steel and Oil sectors

Railways

Post Offices, Factories, Offices, Bank

Corporate

Hotels

EXPORTS

INTERNATIONAL PRESENCE AND EXPORT

ITI has exported products such as ADPCM, C-Dot MBM / SBM Switches, SMPS

Power Plant, VRLA batteries, CDMA WLL Equipments, FWTs, DG Sets, Shelters,

Towers, MW Radios, Rural Exchanges, Telephones of different types, spare cards for

E-10B exchanges Single Channel VHF Radio, Multi Access Rural Radio (Analog and

Digital both) and ASICs to countries in Afghanistan, Asia, Africa and Europe. Besides

various projects in India, ITI has successfully executed turnkey projects overseas.


72

GLOBAL CUSTOMER PROFILE

Afghanistan

Botswana

Bhutan

China

Comoros

Gambia

Ireland

Madagascar

Malaysia

Nepal

COMPETITORS INFORMATION

1. Nokia

2. Samsung

3. L G

4. Eric son

5. Siemens

6. United Telecom

These companies are foreign companies where they have given a major

competition to ITI These companies is competition with ITI in pricing issues this


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company takes orders from other company for fewer prices and has low profit

margin and has less overhead cost. From all these reasons they receive the order

flow to these companies rather than flowing to ITI.

In ITI they cannot cut down the cost because they have high overhead

expenses. So company is planning to reduce these expenses by reducing employee

by giving those VRS and superannuation of the employee.

TECHNICAL COLLABORATIONS/ STRATEGIC ALLIANCES

In order to meet the emerging needs of the customers as well as to develop cutting

edge capabilities ITI has select strategic alliance with leading companies from around the

world.

Alcatel CIT, France GSM Infrastructure

Tekelec Inc, USA SSTP

ZTE, China CDMA Infrastructure, DWDM

Xalted, India STM-64

Midas Communications, India EDWAS Eqpt (BB corDECT)

Tejas Networks

India SDH Optical Transmission Eqpt

VNT, India Automated Integrated Management System

Aphonic Power Systems, India Energy Saving Devices

C-DOT, India Swit chess, IVRS, HVP Devices

Tellabs, Finland MLLN

Juniper Networks, USA MPLS-IP Router


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DACS Electro systems, India Switch Mode Power Systems

HBL, India Artillery Fuses

BSNL, India Ku band VSAT Services

Moby, China Antenna for GSM & CDMA

Coral Networks, India ISDN PABX

SAF Technical, Latvia 15/18 GHZ Microwave Equipment

Eltek SGS (India) Ltd SMPS

Kyocera, Japan Burst (Wireless Broadband Equipment)

Alpine, USA G-PON

Eltel, India TWT 700 watt HPA

Watch Data, China SIM Card

Aras or Technologies Pvt India IFWT

Telsima India DCME


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4.5 RESEARCH AND DEVELOPMENT

INTRODUCTION

I.T.I's technological strength lies in its vibrant R&D Unit.

Products developed by R&D forms a major portion of the company's turnover. The resources

include:

An exclusive core R&D manned by highly qualified and talented engineers with

ISO 9001 certification and representation in national and international level

quality standard panels

State- of -the- art design aids

o Modern facilities for complete equipment and system evaluation

o Comprehensive vendor evaluation facilities

o Approval and qualification facilities to match international standards.

o Customized Telecom and IT solution expertise.

Expertise in adapting imported technology/products to the country's requirement.

BANGALORE PLANT

This is the first Plant of ITI set up in 1948. With its, vertically integrated, state-

of-the-art infrastructure a vast range of telecom products are manufactured. They include

digital switches (large, medium, small), Digital Microwave equipment, optic fiber

equipments, satellite communication equipment, access products, terminal equipments.

The main R&D Centre is housed in this Plant.

FACILITIES

• Hybrid Micro circuits lab


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• Surface Mount Technology

• Component approval and Vendor evaluation centre

• Environment test lab

• EMI Shielded chambers

• Modern PCB plant

• Metal parts, heat treatment , finishing , and molding and die casting shops

• Full fledged tool room

• Modern electronic assembly/ testing facilities.

4.6 PURCHASE AND MATERIAL MANAGEMENT

INTRODUCTION

The effectiveness of material management function is very critical in the

operating system for the success of the company. In the present competitive business

environment where the customers has become more demanding on quality delivery

and cost.

Ensuring availability of balanced inventory at the right time schedules at the most

economic cost and optimality utilizing the capacities created, would determine the

efficiency of the operations. Integrated material management is a mandatory

requirement in the Indian telephone industry plant.

The main function of purchase and material management department is as follows:

Material planning

Purchase function

Inward goods management

Stores management


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Inventory management

CHAPTER: V

SWOT ANALYSIS

5.1 INTRODUCTION

SWOT analysis measures a business unit, a proposition or idea. A SWOT analysis

is a subjective assessment of data which is organized by the SWOT format into a logical

order that helps understanding, presenting, discussion & decision-making. The 4

dimension are a useful extension of a basic two heading list of pro’s and con’s.

ITI has significantly been able to corner around 3 million lines order on GSM

network during the year, the secured projection from the customers have enabled the

company to set up a capacity for 1 million lines at Mankapur & another 3 million lines at

Rae Bareli in addition to it, the capacity for 1 million lines at Bangalore on CDMA has

been planned. These 3 manufacturing facilities would enable the company to achieve a

turnover more than Rs.2000 crores.

Thus ITI has various strengths to its credit & also opportunities. The strength,

weaknesses, opportunities & threats of ITI can be classified as under.

5.2 STRENGTHS:

Strengths are attributing of the organization that is helpful to the achievement of

the objective. It means determining an organization’s strong points. This should be from

both internal & external customers. Strength is a “resource advantage relative to

competitors & the needs of the markets a firm serves or expects to serve”. It is a


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distinctive competence when it gives the firm a comparative advantage in the

marketplace. Strengths arise from the resources & competencies available to the firm.

The various strengths of ITI are as follows:-

India’s first telecom equipment manufacturer.

50 years of experience in telecommunication.

Over 60% of contribution to the existing national telecom network.

Total telecom solutions provider.

Recognized as top turnkey services company.

Multi-locational state-of-art manufacturing facilities with ISO 9001:2000.

Complete range of telecom products, value added services, strategic

alliances with global telecom/IT majors.

Large work force with technical expertise.

Large Market share

Quick adoption to new & latest technology.

One of the best infrastructure and R&D.

5.3 WEAKNESSES:

Weaknesses are attributing of the organization that are harmful to the achievement

of the objective. This means determining of an organization’s weaknesses, not only from

its point of view, but also more importantly, from customers. Although it may be difficult

for an organization to acknowledge its weaknesses it is best to handle the better reality

without procrastination. A weakness is a “limitation or deficiency on one or more

resource or competencies relative to the competitors that impedes a firm’s effective

performance”.

WEAKNESSES OF ITI:

Surplus manpower.

Resistance to changes by some group of employees.


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Normally, training the aged & less qualified employees to latest

technology in some case highly impossible. ITI has proved otherwise

certificate holders & fitters are all doing even testing in digital electronics.

Products are priced very less due to competition.

Having monopoly in the telecom manufacturing field, ITI is very poor in

marketing. It did not have marketing department concept itself before

1991.

Political interference.

No desire for development is killing the company.

Worker efficiency is low as compare with other companies , because of

age group they are having

5.4 OPPORTUNITIES:

Opportunities are external conditions that are helpful to the achievement of the

objective. Another major factor is to determine how organization can continue to grow

within the market place opportunities are everywhere, such as the changes in technology,

government policy, social patters, & so on an opportunity is a major situation in a firm’s

environment. Key trends are one source of opportunities. Identification of a previously

overlooked market segment, changes in competitive circumstances, technological

changes, & improved buyer or supplier relationship could opportunities for the firm.

OPPORTUNITIES OF ITI:

Introduction of better & improved technology.

Can improve the Quality of the products.

Training & development strategies.

Diversify their products to a new line

Huge capital investment is available to introduce a new product which can

beat competitor’s products.

New models of telephone can be introduce to grab the market.


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5.5THREATS:

Threats are external conditions that are harmful to the objective. They are external

factors that are out of our control. It is vital to be prepared & face threats even during

turbulent times a threat is a major unfavorable situation in a firm’s environment. Threats

are key impediments to the firm’s current or desired position.

The entrance of new competitors, slow market growth, increased bargaining

power of key buyers or suppliers, technological changes & new or revised regulations

could represent threats to a firm’s success.

The threats faced by the ITI are as follows:

Competition from private sector & nationals.

Disinvestments policy of the government.

Frequent fluctuations in the global competitive market

Economics policies of the government.

There is chance of Huge executive turnover.

Promotional opportunities are bleak.


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CHAPTER: VI

SELECTED PROBLEM – FINANCE DEPARTMENT

“An Analysis of working capital management”

6.1 OBJECTIVE OF THE STUDY

The project is mainly consists of two folded objectives i.e., main objective and other

objectives. The main objective is to acquire as much knowledge as possible from the

industry side. The other objective is to find the one basic problem & give in suggestion to

the organization. It deals with the follows points:-

6. To analyze the problem regarding working capital management through ratio

analysis

7. To focus the growth of company in terms of sales, profits etc.

8. To study the trend of their performance, which will be helpful to solve the

problem of working capital management?

9. To analyze the problems of the Finance Department

6.2 METHODOLOGY OF THE STUDY

The internship training report executed in the ITI Limited, Bangalore Regional

office. The study mainly focuses on the overall operation of the company. The data

collected from the respective departments and the discussion with the higher officials of

the company. In addition to that the trainee has adopted observation method of collecting

information from the ITI Limited.


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This project involves the study of cash requirements of Indian Telephone

industries limited for the purpose of analysis, the balance sheet and the profit and

loss account for the current year has been collected. The data for this purpose of

the study was collected from both primary and secondary sources.

Primary sources:

The primary data was collected from the central finance department of ITI.

Secondary sources:

The secondary data was obtained through annual reports, manuals and

various magazines. The various tools used for the purpose are profit and

loss account, balance sheet of the company, cash flow statements and

graphs.

WORKING CAPITAL MANAGEMENT:

Introduction.

Every business needs funds for two purposes-for its establishment & carry out its

day to day operations. Long term funds are required to create production facilities

through purchase of fixed assets such as Plant & machinery, Land, Building,

furniture, etc. Investment in these assets represents that part of firm’s capital

which is blocked on a permanent or fixed basis & is called Fixed capital. Funds

are also needed for short -term purposes for the purchase of raw material, payment

of wages, & other day-to-day expenses etc.

“Working capital is the amount of funds necessary to cover the cost of operating

the enterprise.”

Need for working capital management:-

The main purpose of working capital management in an organization to meet the

short term requirement of capita,(i.e. purchase of raw material , payment of wages

& salaries etc).


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Purchase of Raw material, components & spares.

To pay Wages & salaries

Day to day expenses of the company.

To meet the selling expenses as packing & advertising cost.

Provide credit facilities to customers.

To maintain inventories of Raw material ,Work in progress, stores &

finished goods.

Importance of Adequate working capital:-

Solvency of the business.

Goodwill.

Easy Loan.

Cash discounts.

Regular supply of Raw materials.

Regular payment of Salaries, wages & other day-today commitments.

Exploitation of favorable market conditions.

Ability to face crisis.

Quick & regular return on investments.

High Morale.

Approaches for determining an appropriate working capital mix:


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Conservative approach:-

This approach suggest that the entire estimated investment in current assets should be

financed from long term sources & short term sources be used only for emergency

requirements.

Hedging or matching approach:-

According to this approach the maturity of sources of funds should be matched with

the nature assets to be financed. This approach suggest that the permanent working

capital requirement should be financed with funds from long term sources while the

temporary or seasonal capital should be financed with short term funds

Aggressive approach:-

The aggressive approach suggests that the entire working estimation requirement of

current assets should be financed from short term sources & even a part of fixed

assets investment be financed from short term sources. This approach makes finance-

mix more risky, less costly & more profitable.

WORKING CAPITAL ANALYSIS OR


Conservative approaches

85

Hedging or matching approaches

Aggressive approaches

MEASURING THE WORKING CAPITAL

. No business can run successfully without adequate amount of working capital.

However, it must also be noted that working capital is a means to run the business

smoothly & profitably & not an end. The concept of working capital has its own

importance in a going concern. A going concern usually has a positive balance of

working capital but sometimes the uses of working capital may be more than the

sources resulting into a negative value of working capital. A study of changes in uses

& sources of working capital is necessary to evaluate the efficiency with which the

working capital is employed in a business. This involves the need of working capital

analysis. It can be measure through:

1) Ratio analysis

2) Funds flow analysis

3) budgeting.

In this case we are proceeding with the help of Ratio analysis:-

RATIO ANLYSIS:-

A ratio is a simple arithmetical expression of the relationship of one number to

another. The technique of ratio analysis can be employed for measuring short-term

liquidity or working capital or position of a firm. The following ratios may be

calculated for this purpose:

1. Current ratio

2. Quick ratio

3. Absolute liquidity ratio

4. Inventory turnover ratio

5. Debtors turnover ratio


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6. creditors turnover ratio

7. fixed assets turnover ratio

8. cash turnover ratio

9. operating turnover ratio

The above Ratios will be calculated & interpretation is given in the following pages

in detail.

1.1 CURRENT RATIO:-

Current ratio is the ratio, which expresses the relationship between current assets &

current liabilities. The formula for calculating the current ratio is given below:

Current ratio = current assets /current liabilities

(Amount is Rs)


YEAR CURRENT ASSETS C.LIABLITIES CURRENT RATIO

2003-2004 4852127907 2641319646 1.88:1

2004-2005 7064594464 5360967564 1.32:1

2005-2006 8101139172 4744019717 1.70:1

2006-2007 7729529625 6684001216 1.16:1

2007-2008 7340631953 6385979581 1.15:1

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Interpretation:-

From the above tables we can see that last five years current ratio of company is not

satisfactory. The ideal current ratio is 2:1 most of the years it is not even equal to 1,its

current assets are not equal to its current liabilities.

1.2 Quick ratio:-

It is the ratio which expresses the relationship between liquid assets & liquid liabilities.

The liquid assets include all current assets except stock & prepaid expenses. On the other

hand a liquid liability includes all current liabilities except bank overdraft & cash credit.

Quick ratio= Quick assets / Quick liabilities


88

Interpretation:-

From the above tables we can see that last five years Quick ratio of company is

satisfactory. The ideal quick ratio is 1:1 most of the years it is not even equal to 1, even

we can see from that the tables in 2005-06 it’s exceed the quick liabilities.

1.3 Absolute liquidity ratio:-

It is the ratio, which expresses the relationship between the absolute liquid assets & quick

liabilities. Absolute liquid assets include cash in hand, cash at bank, readily marketable

securities. On the other hand liquid liabilities include all current liabilities except bank

overdraft & cash credit. Ideal ratio is 1:2

Absolute liquid ratio= Absolute liquid assets / quick liabilities

YEAR Absolute liquid assets Quick liabilities Absolute Quick ratio

2003-2004 23271374 2641319646 0.008:1

2004-2005 794212 5360967564 0.00014:1

2005-2006 493184502 4744019717 0.1039:1


YEAR Quick assets Quick liabilities Quick ratio

2003-2004 2506063867 2641319646 0.95:1

2004-2005 4674099268 5360967564 0.87:1

2005-2006 6792807972 4744019717 1.43:1

2006-2007 6472792649 6684001216 0.97:1

2007-2008 6138883489 6385979581 0.96:1

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2006-2007 61525527 6684001216 0.009:1

2007-2008 44711725 6385979581 0.007:1

Interpretation:-

From the above tables we can see that last five years Absolute Quick ratio of company is

not satisfactory. The ideal absolute quick ratio is 1:2 but liquid assets are not even equal

to one this case. It is clear that the company do not have liquid cash in hand or at bank to

meet its working capital requirement.

1.4 Solvency ratio:-

This ratio is the ratio between total assets & total liabilities. Higher the solvency ratio stronger

will be the financial position of a concern & visa versa.

YEAR Total assets Total liabilities Solvency ratio

2003-2004 5258399487 11015602524 0.48:1

2004-2005 7412772099 11757146313 0.63:1

2005-2006 26229486693 29961491136 0.88:1

2006-2007 24045510928 29449443423 0.82:1

2007-2008 24609665599 29452891532 0.84:1

Interpretation:-

From the above tables we can see that last five years solvency ratio of company is not

satisfactory. Higher the solvency ratio stronger will be the financial position of a concern

& visa versa. It is clear that the company’s financial position is not strong since from last

few years.


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1.5 Inventory turnover ratio:-

It’s the ratio, which expresses the number of times the stock is turned over. In other words it is the

ratio between the stock & cost of goods sold. A stock turnover of 8 times or more indicate the

effectiveness. The formula for calculating Inventory turnover ratio is given as follows:

Inventory turnover ratio=cost of goods sold / average stock

Average stock = opening stock + closing stock /2

YEAR Cost of goods sold Average stock I.T.R(in times)

2003-2004 4059084814 2346064040 1.73 Or 2 times

2004-2005 6476757638 2390495196 2.70 Or 3 times

2005-2006 5620532608 1308331200 4.29 Or 4 times

2006-2007 5637757047 1256736976 4.48 Or 4 times

2007-2008 3275452473 1201748464 2.72 Or 3 times

Interpretation:-

From the above tables we can see that Inventory turnover ratio is not satisfactory. The

ideal ratio is 8 times & we can say that company’s Inventory turnover ratio or stock

turnover ratio is not effective. That means it is not able to convert its inventories to sales

effectively.

1.6 Debtor’s turnover ratio:-

This ratio indicates the relationship between debtors & sales. It indicates the number of

times the debts are collected in a year. Debtor here means the average debtor & bills

receivable. Sale here mean net credit sales minus returns.


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Debtor’s turnover ratio = Net credit sales / Average Debtor

YEAR Net credit sales Average debtor D.T.R(times)

2003-2004 1801845025 1945334901 0.92:1

2004-2005 4078203758 3755425616 1.08:1

2005-2006 5030720620 5560566322 0.90:1

2006-2007 4787987889 5427896573 0.88:1

2007-2008 2629803939 5241780428 0.50:1

Interpretation:-

From the above tables we can see that Debtor turnover ratio is not satisfactory. we can

say that company’s Debtor turnover ratio is not effective. The company is not able

collect the money from the debtor on time & not able to cover.

1.7 creditor’s turnover ratio:-

This ratio indicates that the relationship between the creditors & purchases. In other

words, it indicates the number of times the creditors are paid in a year. A creditor means

sundry creditors & bills payable.

Creditors turnover ratio = Net annual credit purchases / average creditors

YEAR Net credit purchases Average creditors C.T.R(times)

2003-2004 149202493 2417117924 0.06:1

2004-2005 1754280774 5041902963 0.34:1

2005-2006 1690205872 4042593243 0.41:1

2006-2007 3952537566 5954551552 0.66:1


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2007-2008 1598764886 6143121670 0.26:1

Interpretation:-

From the above tables we can see that creditor’s turnover ratio is not satisfactory. We can

say that company’s creditor’s turnover ratio is not effective. The company is not able to

pay the money to the creditors on time & there is a shortage of funds.

1.8 Operating ratio:-

This ratio expresses the relationship between operating cost and sales. Operating cost

refers to all expenses for operating a business. Lesser the operating cost more will be the

profit for the company and vice versa. The formula for operating ratio is given below.

Operating ratio= operating cost / net sales *100

YEAR Operating cost Net sales Operating ratio

2003-2004 3628266225 1801845025 2.01:1

2004-2005 6836851628 4078203758 1.67:1

2005-2006 4748849878 5030720620 0.94:1

2006-2007 5843578172 4787987889 1.22:1

2007-2008 3414027190 2629803939 1.29:1

Interpretation:-

From the above tables we can see that operating ratio is more compare to the net sales, so

therefore we can say that the operating expenses are huge which is not covering the

revenue collected by the company. This ratio represents the operating expenses of

company as huge amount.


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1.9 Current assets turnover ratio:-

Current assets to turnover ratio, it indicates the ratio between currents assets and sales. A

high current assets turnover ratio is an indication of a better utilization of current assets

and visa versa. The formula to calculate the ratio is given as follows:

Current assets turnover ratio = Net sales /Current assets

YEAR Net sales Current assets Current assets

turnover ratio

2003-2004 3628266225 4852127907 0.37:1

2004-2005 6836851628 7064594464 0.57:1

2005-2006 4748849878 8101139172 0.62:1

2006-2007 5843578172 7729529625 0.61:1

2007-2008 3414027190 7340631953 0.35:1

Interpretation:-

From the above table we can say that the current assets turnover ratio is not satisfactory.

The company is not operating at its optimum level; therefore it needs to speed up its

conversion process so that it can utilize the assets at optimum level.

1.10 Cash turnover ratio:-

This ratio is the ratio between cash and sales or turnover. Cash means cash in hand and

cash at bank and sales means net annual sales minus sales return. This ratio can be

calculated from below formula:

Cash turnover ratio= net annual sales / cash

YEAR Net sales cash Cash turnover

ratio

2003-2004 3628266225 23271374 155:1


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2004-2005 6836851628 794212 8608:1

2005-2006 4748849878 493184502 9.62:1

2006-2007 5843578172 61525527 95:1

2007-2008 3414027190 44711725 76:1

Interpretation:-

From the above table we can say that the company is not in good liquidity position to

manage its cash sales , we can observe the trend of ratio its

Summary & findings:-

The sales of the company is decreased to 262 crores (Bangalore plant) from

478crs due to the decrease in order book of the company.

Growth of sundry debtor of the company has decreased due to reduction in

sales & realization of debtors is also low. The company has taken efforts to

realize its debts.

Current Liability of the company indicates that there is delay of payments of

its debts as realization of debtors is also low. The payment is also delayed &

also due to communication gap which has to be reduced.

Inventory management technique is yet to be used to the fuller extent by the

organization.

In the year 2005 the liquidity position of the company is improved due to

raising of funds from secured loan.

The company sales trend is positive; this is due to the improvement in

production & marketing strategy of the company.

CHAPTER: VII


95

SUGGESTION & CONCLUSSION FOR THE SELECTED

PROBLEM:-

1. The company should collect the money from the customers promptly and in time.

So that it can improve its liquidity position

2. The company should maintain the debtors velocity period, it will help the

company in speeding up the cash cycle time.

3. The company should go for cost cutting so that it can improve its operating profit

ratio, it will help company in investing in some new projects which is at most

requirement of the company

4. The company should ask the credit period relaxed way to the supplier. It Would

help the company in meeting other requirements & can reduce the huge burden of

expenses.

5. The company can introduce some software for the maintenance of accounting

records and maintenance; it can help company in reducing the cost & improve the

efficiency of work which is very much important.

6. Project planning plays a vital role in any organization. After getting funds from

the sources allocation of funds to those projects which can be profitable & can be

executed in a very well manner is important instead of going to the traditional

products like, telephone equipment, small electronic equipment etc.

7. Allocation of funds should be done in careful manner for mobility of funds to

various departments & different products to minimize the risk.

7.2 CONCLUSION:-

The internship training gives a clear picture about the operations of the company, and

also it focused the working capital management problem of the company. The training

analyzed the causes of the working management problem and suggested the solutions for

solving the problem.


96

The company started of as Indian Telephone Industries which was concerned with

telephone and related products. Late in 1994 changed its name to ITI Ltd. The company is

moved a step ahead into IT world and no more existing as telephone manufacturers only.

The convergence of technologies has resulted into evolution of new series at affordable

cost. Services, which were primarily hardware driven, are now being catered by

equipment which has more software content Communication business has shifted to being

equipment driven to customer demanded services. Fixed lines, which till recently formed

chunk of ITI turnover have declined considerably and now the growth is in mobile

business.

ITI with its diverse experience in equipment manufacturing, installation,

commissioning development and engineering is well placed for taking up end to end

business solution and engineering is well placed for taking up end business solution and

has shown the capability by installing GSM network for MTNL and BSNL, satellite

network CIVICON project for ministry of home affairs. The company’s effort to diversify

into IT and IT enabled services have led to in house development of products such as

INFOKIOSK, public key infrastructure (PKI), computer telephone integration (CTI),

CALL CENTRE and e-commerce platform from R&D and IT group.

CHAPTER: VIII

Over all SUGGESTION & CONCLUSSION

SUGGESTION:-


97

After studying all the departments & functional areas of the company we

suggest that the company should concentrate on its core business area instead

of secondary functions.

We can see that the company’s time to execute a project is too long therefore

company should execute its projects on time so that it can help in getting huge

orders from the same customer again & make them loyal to the company.

The company is not able to utilize its funds in adequate manner (i.e.

allocation of resources which can be executed on time & profitable).

The company should go more for its diversification of business instead of

going on traditional products& services (like landline telephone) ,GSM,

CDMA, WI-FI .VSAT services.

The company is turning towards the IT world as Total IT service provider

which is advantages for the company, it can have joint venture with some

other private players to gain a market advantage.

ITI is oldest telecom company in the Indian telecom industry; it has a good

experience in foreign joint ventures. It can proceed more in this field to get a

more cost effective & quality services from across the globe.

There is no Indian company which is manufacturing mobile phone on its own

resources, ITI is having that much of infrastructure & can invest huge capital

in this field.

CONCLUSSION:-

The company started of as Indian Telephone Industries which was concerned with

telephone and related products. Late in 1994 changed its name to ITI Ltd. The company is

moved a step ahead into IT world and no more existing as telephone manufacturers only.

The convergence of technologies has resulted into evolution of new series at affordable


98

cost. Services, which were primarily hardware driven, are now being catered by

equipment which has more software content Communication business has shifted to being

equipment driven to customer demanded services. Fixed lines, which till recently formed

chunk of ITI turnover have declined considerably and now the growth is in mobile

business.

ITI with its diverse experience in equipment manufacturing, installation, commissioning

development and engineering is well placed for taking up end to end business solution

and engineering is well placed for taking up end business solution and has shown the

capability by installing GSM network for MTNL and BSNL, satellite network CIVICON

project for ministry of home affairs. The company’s effort to diversify into IT and IT

enabled services have led to in house development of products such as INFOKIOSK,

public key infrastructure (PKI), computer telephone integration (CTI), CALL CENTRE

and e-commerce platform from R&D and IT group.

ITI is a company with excessive Labour force (approximately 3000 employees).In the

awake of this depressed phase of the company wee there is no producduction, there is

excessive unproductive labor force. This problem is solved through VRS scheme and OJT

programs. Both of these programs have been successful.However,a few employees

resented due to age/retirement factor. Due to low phase the company is definitely not in a

position to pay the wage and salaries in tie however, the employees do get their salaries

even though it is delayed payment.

The company’s role as a significant resource provider for building vital infrastructure is

underscored by the fact the ITI continues to maintain its leadership by being the largest

supplier of switching equipment as well as the SDH fiber optic terminals to the country’s

telecom network. The major thrust being placed on speedier implementation of new

technologies and faster skill formation in new areas, as part of the total restructuring

exercise, would lend ITI a keen competitive edge in convergence market.


99

BIBLIOGRAPHY

Books Author publicationMarketing Management PHILIP KOTLAR Pearson’s publishers

Finance Management SHASHI K. GUPTA & ANNUAL REPORT OF ITI 2007-2008

Kalyani publishers

Human Resource Management

SUBBARAO Himalayan publishers

Production Management K.ASHWATHAPPA TAta McGraw hillsWebsite http. \\www.itiltd.com --

ANNEXURE

PERFORMANCE


100

Performance from 2002 to 2007 in Rs. Crores

Year 2002-03 2003-04 2004-05 2005-06 2006-07

Sales(Incl. ED) 1794.65 1256.57 1389.01 1,749.38 1,818.33

Production 1689.37 1072.66 1362.22 1,607.20 1,797.05

Profit /Loss

After tax (374.87) (705.83) (309.82) (428.76) (405.26)

Growth

In turnover - -

10.54%25.94%

3.94%


101

FINANCIAL RESULTS FOR THE QUARTER ENDED 31.03.2008

(With limited review of the results for the quarter ended 31/03/08)

(Rs. In lakhs)

SL. NO.

PARTICULARS 3 months ended (31/03/08) (unaudited)

Year to date figures for the current period ended 31/03/08 (unaudited)

1

2A

Sales/income from operations

Less: excise duty

Transfer from grant-in-aid

38,275

1,869

36,406

35,301

123,367

6,788

116,579

35,694


102

2B

3

4

5

6

7

8

9

10

11

12

13

Other income

Total income (1+2)

expenditure

a) (increase)/decrease in stocks

b) consumption of raw materials

c) employee cost

d) depreciation

e) other expenditure

f) total

financing expenses

exceptional items (prior period adjustment)

profit / (loss) from ordinary activities

before tax (3-(4+5+6))

provision for taxation

current tax

deferred tax

fringe benefit tax

profit / (loss) from ordinary activities after tax (7-8)

extraordinary items

profit / (loss) (9-10)

paid-up share capital

equity share capital (face value of Rs. 10 each)

preference share capital (face value of Rs. 100 each)

reserves including grant-in aid and excluding revaluation reserve (as per balance sheet of previous accounting year)

1,861

73,568

1,376

25,866

13,421

676

5,857

47,196

8,314

15,576

2,482

_

_

21

2,461

_

2,461

28,800

30,000

4,309

156,582

254

92,709

37,723

3,407

14,611

148,704

26,837

15,576

(34,535)

_

_

76

(34,611)

_

(34,611)

28,800

30,000


103

14

15

earnings per share

a) Basic and diluted EPS before extraordinary items for the period, for the year to date and for the previous year (not to be annualized (in Rs.))

b) Basic and diluted EPS after extraordinary items for the period, for the year to date and for the previous year (not to be annualized (in Rs.))

public shareholding

number of shares (equity)

percentage of shareholding

0.85

0.85

20,219,310

7.02%

-12.94

-12.94

20,219,310

7.02%

Note; the above results were approved by the board of directors at their meeting held on 29/04/08


104

BALANCE SHEET AS AT 31 ST MARCH 2008

SCHEDULE NUMBER

AS AT 31ST MARCH 2008

SOURCES OF FUNDS:-

Shareholders’ funds

Share capital

Reserves and surplus

Grant-in-aid

Loan funds

Secured loans

Unsecured loans

APPLICATION OF FUNDS:-

Fixed assets

Gross block

Less: depreciation to date

Net block

Capital work-in progress and machinery in transit

Investments

Current assets, loans and advances

Inventories

Sundry debtors

Cash and bank balances

Loans and advances

Less: current liabilities and provisions

1.1

1.2

1.3

2.1

2.2

3.1

3.2

4.0

5.1

5.2

5.3

5.4

588.00

2563.04

85.70

1334.47

895.42

3657.09

987.31

2669.78

1.29

379.41

1828.92

14.17

2222.50

323.09

2545.59

3236.74

2229.89

5466.63

2671.07

8.15


105

Current liabilities

Provisions

Net current assets

Miscellaneous expenditure to the extent not written-off or adjusted

Profit and loss account

6.1

6.2

7.1

7.1A

2152.64

153.87

2306.51

239.08

0.00

2548.33

5466.63

Schedules 1.1 to 10 and accounting policies annexed form an integral part of balance sheet. As per our report of even date

PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31 ST MARCH 2008

SCHEDULE NUMBER

FOR THE YEAR ENDED 31ST MARCH 2008

INCOME

Sales

Services

Total sales and services

8.1 1041.55

171.76

1213.31


106

Less: excise duty

Interest earned

Other income

Transfers from grant-in-aid

Total

EXPENDITURE

Consumption of raw materials and production stores

Purchase for direct sales

Charges on installation & maintenance of exchanges

Salaries, wages and bonus

Company’s contribution to providend fund and other funds

Workmen and staff welfare expenses

Voluntary retirement payments

Depreciation

Less: transfer from revaluation reserve

Financing expenses

Deferred revenue expenditure written off

Manufacturing expenses

Administration expenses

Selling expenses

Total

Less: transfer to capital account

Accretion/(decretion) to:

Work in process

Manufactured components

Stock-in trade

8.2

8.3

8.4

9.1

9.2

9.3

9.4

9.5

9.6

9.7

9.8

9.9

9.10

9.11

9.12

9.13

9.14

57.69

57.38

28.11

0.10

(22.32)

1.31

1155.62

1.81

64.98

357.20

1579.61

424.93

459.97

59.75

258.48

111.61

12.54

0.32

29.27

282.43

0.00

51.37

67.87

7.36

1765.90


107

Miscellaneous expenditure not written-off

Cost of sales for the year

Profit before tax for the year

Prior period adjustments(net)

Profit before tax

Less: provision for taxation

Fringe benefit tax

Profit after tax

9.15

9.16

9.17

16.69

0.00 (4.22)

1770.12

(190.51)

(164.53)

(355.04)

1.15

(356.19)

(Rs. In crores)

Includes expenditure on research & development Rs. 25.65 crores under various heads


108

Documents

Project Repot(M.M.ZUHEB.P2009)