Professional Documents
Culture Documents
SUBMITTED TO
[1] READ! IN THE NAME OF THY LORD AND CHERISHER, WHO CREATED,[2] CREATED MAN, OUT OF A CLOT OF CONGEALED BLOOD: [3] READ AND THY LORD IS M OST BOUNTIFUL, [4] HE WHO TAUGHT (THE USE OF) THE PEN, 5] TAUGHT MAN THAT WHICH
HE KNEW NOT
SUBMITTED BY:
H AR
AFIZ LI
AZA
ACKNOWLEDGEMENT
WHEN WE START WRITING, WE STOP FOR WHILE AND THINK WHAT TO WRITE? HOW TO WRITE ? WE HAVE
NO WORDS TO EXPRESS OUR FEELINGS. BUT WE HAVE TO WRITE TO OFFER OUR HUMBLEBEES SENSE TO
WE WOULD LIKE TO THANKS MISS AMNA SHAFIQUE & MR. ABU BAKAR (HR MANAGER OF NISHAT)
TO GUIDE US AND TAUGHT US VERY SINCERELY SO THAT WE ARE ABLE TO MAKE THIS PROJECT
Dedicate To My Fiance
SAMINA
Table of Contents
1. Introduction of Nishat Group ......................................................................................................... 12 Mission Statement ............................................................................................................................. 13 VISSION Statement ............................................................................................................................ 13 2. Nishat Chunian Limited: ................................................................................................................. 14 3. Performance of the Company ........................................................................................................ 15 i. ii. iii. iv. Investments ............................................................................................................................... 16 Financial Structure ..................................................................................................................... 17 Business Strategy ....................................................................................................................... 17 Corporate Governance ............................................................................................................... 18
4. PREFACE ........................................................................................................................................ 19 5. Organizational Objective ................................................................................................................ 21 6. Organizational Structure of Nishat ................................................................................................. 21 7. Human Resource and Management ............................................................................................... 22 i. ii. iii. iv. v. vi. vii. Introduction ............................................................................................................................... 22 HUMAN RESOURCE .................................................................................................................... 22 Purpose...................................................................................................................................... 23 Objectives of HRM ..................................................................................................................... 23 Role of HR Department .............................................................................................................. 23 Jobs of HRM ............................................................................................................................... 24 HRM in Nishat Mills ................................................................................................................ 24
a. b. c. d. e.
Home Textile Products ............................................................................................................... 28 Dyes and Finishes: ...................................................................................................................... 28 Bed Linen ................................................................................................................................... 29 Curtains ..................................................................................................................................... 29 Table Linen................................................................................................................................. 29
10. Recruitment Process .................................................................................................................... 30 11. Recruitment Policy ....................................................................................................................... 30 12. Internal Recruitment: ................................................................................................................... 31 ii. Replacement charts ................................................................................................................... 31
13. External Recruitment ................................................................................................................... 32 14. Economic Factor........................................................................................................................... 33 15. Work Environment ....................................................................................................................... 34 16. Hierarchy Chart ............................................................................................................................ 35 Ah hierarchy is an arrangement of objects, people, elements, values, grades, orders, classes, etc. A hierarchy chart shows that what comes after what A hierarchy chart of an organization shows the formal structure of an organization s positions and it shows that who reports to whom and clear the confusions. ........................................................................................................................................ 35 17. CENTRALIZATION AND DECENTRALISATION:................................................................................. 36 o o o Centralization............................................................................................................................. 36 Decentralization: ........................................................................................................................ 36 Decision Making System of Nishat Chunian ................................................................................ 36
18. PERFORMANCE APPRAISAL .......................................................................................................... 37 19. Motivation ................................................................................................................................... 38 20. Swot Analysis ............................................................................................................................... 40
Executive Summary
Nishat has grown from a cotton export house into the premier business group of Pakistan with 5 listed companies, concentrating on 4 core businesses; Textiles, Cement, Banking and Power Generation. Today, Nishat is considered to be at par with multinationals operating locally in terms of its quality products and management skills. The system, the style of working & the commitment of the employees in NML is really exemplary. The difference between the success & failure is doing things right and doing things nearly right, & NML has always tried for success & that is why it is known to be one of the leading organizations in Pakistan. Irrespective of all these positive points of Nishat Mills Limited, I have noticed a few areas where the improvement can really increase the efficiency of NML. In this report I have given a very brief review of what I have seen during our project I have mentioned all these as I have made a project as according to the schedule. Then I have done a detailed SWOT analysis. Then I have discussed about my learning in the whole project that is all about the HR and process of the productions. I have made it possible to write each and every thing that I have learnt there. I have all my practical efforts in the form of this manuscript that s the asset for my future career.
10
Company Information:
Board of Directors: Mr. Muhammad Saleem Mrs. Farhat Saleem Mr. Shahzad Saleem Mr. Manzoor Ahmed Mr. Aftab Ahmad Khan Mr. Manzar Mushtaq Mrs. Nabiha Samad Audit Committee: Mr. Aftab Ahmad Khan Mr. Shahzad Saleem Mr. Manzar Mushtaq Company Secretary: Mr. Farrukh Ifzal Bankers to the Company: ABN AMRO Bank N.V. Allied Bank Limited Askari Commercial Bank Limited Bank Alfalah Limited Citi Bank N.A. Deutsche Bank AG Dubai Islamic Bank Pakistan Limited Faysal Bank Limited Habib Bank Limited Hong Kong & Shanghai Banking Corporation Limited Meezan Bank Limited National Bank of Pakistan NIB Bank Limited Standard Chartered Bank Pakistan Limited The Bank of Punjab Union Bank Limited Chairman Member Member Chief Executive Nominee NIT Chairman
11
Auditors: Riaz Ahmad & Company Chartered Accountants Registered & Head Office: 31-Q, Gulberg-II, Lahore, Pakistan Phone :5761730-39 Fax :5878696-97 Web :www.nishatchunian.com Mills: Spinning 1, 4 & 5 49th Kilometre, Multan Road, Bhai Pheru, Tehsil Chunian, District Kasur. Spinning 2, 3 & Weaving 49th Kilometre, Multan Road, Kamogal, Tehsil Pattoki, District Kasur. Dyeing & Printing 4th Kilometre, Manga Road, Raiwind.
12
Mian Mohammad Mansha, the chairman of Nishat Group continues the spirit of entrepreneurship and has led the Group successfully to make it the premier business group of the region. The group has become a multidimensional corporation and has played an important role in the industrial development of the country. In recognition of his unparallel contribution, the Government of Pakistan has also conferred him with Sitara-e-Imtiaz, one of the most prestigious civil awards of the country. The Textile business is further subdivided into 2 textile divisions: Nishat Faisalabad and NishatChunian divisions. The textile capacity of the group is the largest in the country. An addition of20,000 new spindles, 100 new air jet looms and new dyeing plant has increased the existing capacity of 242,000 spindles, 740 looms and dyeing and finishing capacity of 5 millions meters. The group is the largest exporter of textile products from Pakistan for more than a decade. Nishat provides quality piece dyed fabrics in heavy twills to some of the world's leading brand Names like GAP, Old Navy, and banana republic, DKNY, Tommy Hilfiger, Chaps and Sears
13
Mission Statement:
To provide quality products to customer and explore new markets to promote/expand sales of the Company through good governance and foster a sound and dynamic team so as to achieve optimum prices of product of the Company for sustainable and equitable growth and prosperity of the company we want to be among the top suppliers of quality textile products worldwide
VISSION Statement:
Our vision of tomorrow is a better quality of life for the people of Pakistan To transform the Company into a modern and dynamic yarn, cloth and processed cloth and finished product manufacturing Company that is fully equipped to play a meaningful role on sustainable basis in the economy of Pakistan To transform the Company into modern and power generating Company that is fully equipped to play meaningful role on sustainable basis in the economy of Pakistan
14
A new state of art spinning unit started production in November 2000, increasing the total spinning capacity to about 40,872spindles. Subsequently weaving capacity was increased to 212 air jet looms while the spinning capacity was increased to 50,952spindles. During the period ended 30 June2005, the Company enhanced its spinning capacity substantially by acquiring the operating assets of Umber Fabrics Limited comprising of 38,544 spindles and by addition of a new spinning unit with 40,128spindles. In 2006, the Company also diversified into Home Textile Business. The Company is currently operating with142, 196 spindles, 293 looms, a modern dyeing and finishing plant having capacity of 71,000 meters per day and captive power plants with a total capacity of 33MW.
15
However, the Company s profit before tax has sharply declined to Rs. 111.16 million as compared to Rs.340.80 million last year. Profit after tax is Rs. 10.16 million because of the tax provision of Rs.101 million as the Company is under presumptive tax regime. Higher cost of production and increased price competition has reduced the profitability margins substantially. The Company s gross profit margin dropped to 12.47% from last year's 17.84%. Further increase in the financial charges also reduced the profitability. Financial charges are Rs. 648 million showing an increase of Rs. 154 million over the last year. Earnings per share (EPS) are Rs. 0.14 as compared to Rs. 3.34 last year. The reduced profitability of the company is attributable to a number of factors. This was the first year our Home Textiles Plant came into production and initially capacity utilization remained below breakeven level. During the year we had a partial shutdown in one of our spinning units for shifting of machinery for change in the product mix. Higher cotton prices and partial shutdown of the spinning unit resulted into a loss of around Rs. 150 million in our spinning division during the year. Currently our Home Textiles Division is operating at more than 80% capacity. Moreover after changing the product mix of the spinning units,
16
our spinning division is operating at above breakeven level. Keeping in view the present scenario we are hopeful to have a higher profitability in next year
i. Investments
During the year under review, the Company made no substantial investment in the plant and machinery. Presently we are operating with 142,196 spindles, 293 air jet looms, 1 Dyeing &Stitching plant and captive power plants with the combined capacity of 33 MW.
17
18
b. Proper books of accounts have been maintained by the Company. c. Appropriate accounting policies have been consistently applied in preparation of financial statements and accounting estimates are based on reasonable and prudent judgment. The International Accounting Standards, as applicable in Pakistan have been followed in preparation of financial statements. The system of internal controls is sound in design and has been effectively implemented and monitored. There are no doubts upon the Company s ability to continue as a going concern. There has been no material departure from the best practices of Corporate Governance as detailed in the listing regulations of the stock exchanges. The value of investment of contributory provident fund as at 30 June 2007 amounts to Rupees 54.480 million. The pattern of shareholding as at 30 June 2007 is annexed.
d.
e.
f. g.
h.
i.
19
4. PREFACE
1. Main view of Nishat Chunian Ltd.
2. Recipient picture
20
21
5. Organizational Objective
To recognize that HR management exists to contribute to organizational effectiveness. Even when a formal HR department is created to help managers, the managers remain responsible for employee performance. The HR department exists to help managers achieve the objectives of the organization. HR management is not an end in itself; it is only a means of assisting managers with their human resource issues. For example, NISHAT HR department found that it could enhance it contribution to the organization through sophisticated information systems that allowed the department to cut #35 million a year from its budget. Simply stated, an HR department exists to serve the rest of the organization.
22
23
iii. Purpose
The purpose of human resource management is to improve the productive contribution of people to the organization in ways that are strategically, ethically, and socially responsible. This purpose guides the study and practice of HR management, which is also commonly called personnel management. The study of HR management describes the HR- related efforts of operating managers and shows how personnel professionals contribute to those efforts.
v. Role of HR Department
Human Resource department play a very important role in Nishat Chunian Ltd LTD. New talent has a thirst for opportunity and that they are seeking such jobs which enhance there capabilities and to gain some experience. Due to these facts the HR department
24
Of Nishat is looking for these kinds of people who want to excel in life and are highly motivated to achieve some goals. The HR department of Nishat is working day and night to make this Organization a better organization by hiring people who are self motivated and there main aim is to make the company more profitable.
Seeks to fulfill the highest practical degree in administering its welfare and compensation program.
Apprenticeship and other training schemes at all levels. To obtain, manage, develop, motivate and gain the
25
commitment of company's key resource- the people who work in and for it.
To develop a positive corporate culture to promote commitment to excellence and quality throughout the company.
To identify training needs and provide required training to all categories of employees.
To make best use of the skills and abilities of all those employed in the organization.
To ensure that the company meets its social and legal responsibilities towards its employees, with particular regard to the conditions of employment, quality of working life provided for them and the need to promote environment, occupational health and safety.
To ensure industrial peace and harmony through excellent employee relations to achieve optimum level of employee, productivity and to contribute towards company s aimed quality standards.
26
27
9. Department
1. Spinning:
The spinning facility of Nishat Chunian consists of five units with a capacity of 150,000spindles, producing 90 million pounds of yarn per annum. To maintain a consistent product quality, stringent measures are taken not only in the sophisticated in-house labs, but throughout the production process
2. Weaving:
The weaving mill consists of state of the art Picanol Omni, Omni Plus and Toyota air jet looms in various widths ranging from 110 150 inches, providing greater flexibility in catering to customer needs. The renowned European company Benninger-Zell manufactures the Sizing and Warping machinery
28
3. Home Textiles:
The dyeing and finishing plant has a monthly capacity of 3.0 million yards per month with an equivalent stitching capacity. These plants are equipped with state of the art machinery specially designed to cater to high thread count fabric. During the dyeing, finishing and stitching processes, several measures are taken to ensure timely delivery of high quality fabric. This includes special care in fabric handling, full width rail stitching, PVA based size recovery, various devices to avoid creases and band mark variation, special unwinding devices, efficient squeezers, a computerized dye dispensing system and an on-line measurement and storage of data at every machine. a.
The dyed and finished Sheeting and Upholstery range comprises of high density fabrics with widths up to 340 cm and yarn count range of Ne 40/1 100/1. This includes Percales up to 350thread count and Sateen s up to 800 thread count. We also produce high thread count sheeting fabric of unmatched quality with 1000 thread count. Other products in this range include fabric with up to 6 pick insertions, dobby fabric with intricate designs using 12-14 frames and fabrics made using plied, slub, dyed and fancy yarns. In addition to 100% cotton, a number of fibers invarious blends are used including Polyester, Viscose, Modal, Tencel, Bamboo, Soyabean and Milk Fiber. We also use Lycra, Cool Max, eVAP, T400 and Amicor b.
NCL offer a wide range of dyes and finishes which can be adapted in accordance with customer requirements. The various dyeing options include Pigment, Vat, Reactive, Sulphurand Disperse. Some of the various finishes NCL can do are Water Resistant/Repellant, Soil and Stain Resistant, Wrinkle Resistant, Anti-microbial, Ultra Soft Hand Feel, and Fire Resistant. We have also developed antimicrobial, fragrant and ultra fast color finishes
29
c. Bed Linen:
Products in this category include Bed Sheet Sets, Valance Sheets, Bed Skirts, Quilt covers and Comforter Shells.
d. Curtains:
The product range also includes Curtains, Pelmets, Cushions, Tie Backs, 5 pieces Drapery Set, and Rod Percillia, which are offered to customers as separate items, as well as complete Curtain Sets. We also offer Tier Swag Sets for kitchen windows and Shower Curtains
e. Table Linen:
NCL produce Tablecloth, Table Runner, Napkins and Ruffles Round.
30
31
the particular department. Hr department then use two approaches to hire the employee internal recruitment and external recruitment.
Advertising of job openings to current employees via bulletin boards, newsletters, or personal letters. Filling a job opening from within the firm has the advantages of stimulating preparation for possible transfer, or promotion and increasing the general level of morale. The first and foremost preference of Nishat Mills is to hire the employees through internal recruitment and giving existing employees more chances to develop their career. For this purpose Nishat Mills firstly use Internal Job Posting to fulfill the vacant seat.
ii.
Replacement charts:
A visual representation of which employee will replace the existing incumbent in a designated position when it becomes vacant. In Nishat Mills replacement charts are used rarely.
32
33
Spinning industry. Higher fuel prices and gas load shedding disrupting the operations of the power generation, resulted into higher fuel charges. Tightening of monetary policy further increased the already high interest rates.
34
At NCL, we believe in building a long-term relationship with our employees that is enriching and beneficial to both sides. Regular on-the-job training is provided to our employees. Our benefits cover housing and medical expenses for our employees, as well as schooling for their children. We are committed to providing and maintaining a safe environment that fosters the well-being and health of our employees.
35
36
Centralization:
Centralization is the process by which the activities of an organization, particularly those regarding decision-making, become concentrated within a particular location and/or group mostly the top management of organization. In a centralized organization, the decisions are made by top executives or on the basis of pre- set policies. These decisions or policies are then enforced through several tiers of the organization after gradually broadening the span of control until it reaches the bottom tier
o Decentralization:
Decentralization also called departmentalization is the policy of delegating decisionmaking authority down to the lower levels in an organization, relatively away from and lower in a Central authority. A decentralized organization shows fewer tiers in the organizational Structure, wider span of control, and a bottom-to-top flow of decision-making and flow of Ideas.
The decision making system of NISHAT CHUNIAN LIMITED is in between the centralized and decentralized. In past it was fully centralized but as time is passing and the organization is expanding and getting larger day-by-day the decision making system is getting decentralized. Right now some of its policies are made by only top management and in some lower management is also included so the system is not purely centralized not decentralized.
37
1. I am fully aware of my employer s business strategy _________ 2. I fully understand what my employer is trying to achieve in business management and customer satisfaction_________ 3. The department I work in gets sufficient support from the Human resources department_________ 4. The promotions in the department I work in have been fair and result-oriented_________ 5. I get sufficient compensation for the work I do in the company_________ 6. I am fully at peace with my job_________ 7. I am adequately motivated for my work_________ 8. My manager is fun to work with since he/she encourages innovation and creativity_________ 9. There is minimal fear of failure in my department and therefore we are free to experiment on various things_________ 10. My supervisor or manager shapes relations and job attitudes within my department_________
38
19. Motivation
Nishat Mills use compensation process in which Nishat Mills wants to satisfy the individual need of employees and to make the employees work with the organization. The company use cash and non cash rewards to motivate its employees. The company uses the following ways to retain the employee Promotions Promotion is direct shift only to the next level from the current grade, the Employee s performance is evaluated and if his performance is above average he is given promotion.
1-Experience 2-Performance
Increments
39
The company decides at the end of the financial year, according to its financial condition, whether increments should be given or not. Once the increment is decided, it is effective from January of each calendar year. Free transport Nishat Mills provide free transport to local employee and also to their children for school
Medical facility Nishat Mills provide free medical facility to workers depending upon the position/rank of the employee. Free housing They give the facility of free accommodation for all level of employees, again the facility is provided according to the position.
40
41
42
43
The product range is 100% cotton yarn, ranging from 6/1 to 30/1 in carded yarns and From 12/1 to 100/1 in combed yarns. In addition to the above we are also in core spun stretch yarns of 2 and 3 ply yarns and Slob yarns. The total capacity is 59 million lbs of yarn per annum
The weaving capacity is 293 air jet looms wider width. The fabric is being exported to various companies in Hong Kong, Japan, Korea, USA, South Africa, India and Europe. The company believes in product innovation and has successfully leveraged its strength In yarn manufacturing to make a variety of fabrics. NCL timely adds value to its product like addition of dying facility and home textile Manufacturing (mention the year of operations) Sales comprises more than 80% as export which saves in taxation Internal cost controls Most optimum cost of financing and exploration of for-ex transactions like hedging and Forward booking NCL Textile Industry is an Independent & Self-Reliant industry. Availability of abundant Raw Material helps to control costs and reduces the leadtime Across the operation. Availability of Low Cost and Skilled Manpower provides competitive advantage.
44
Large varieties of cotton fiber are available and have a fast growing synthetic fiber Industry. NCL has large and diversified segments that provide wide variety of products. Growing Economy and Potential Domestic and International Market.
NCL has Manufacturing Flexibility that helps to increase the productivity. Qualified and skilled management Health working environment Produces greige fabric for apparel, sheeting, home furnishing and fancy items in 100% Cotton, Polyester Cotton (PC) and Chief Value Cotton (CVC).
Fabric for apparel has been consistently catering to the demands of the export markets As well as the local garment industry. In sheeting we have successfully made sheeting fabric with counts up to 400 threads Using Ne 100/1. This high-count fabric is one of its kind and of unmatched quality. With rising demand for fancy items, NCL has also ventured into producing items like Slob yarn fabric and stretch fabric. NCL now ranks among the first rate stretch fabric producers in the national and the International markets
Weaknesses
45
The absence of certain strengths may be viewed as a weakness. For example, each of the following may be considered weaknesses: NCL Textile Industry is highly Fragmented Industry. NCL Textile Industry is highly dependent on Cotton. Lower Productivity in various segments. There is Declining in Mill Segment. Lack of Technological Development that affect the productivity and other activities in whole value chain. Infrastructural Bottlenecks and Efficiency such as, Transaction Time at Ports and transportation Time. Unfavorable labor Laws. Lack of Trade membership, that restrict to tap other potential market. Lacking to generate Economies of Scale. NCL has to pay Higher Indirect Taxes, Power and Interest Rates.
Opportunities
The external environmental analysis may reveal certain new opportunities for profit and Growth Some examples of such opportunities include: Growth rate of Domestic Textile Industry is 6-8% per annum. NCL has a Large, Potential Domestic and International Market. Product development and Diversification to cater global need Elimination of Quota Restriction leads to greater Market Development. Market is gradually shifting towards Branded Readymade Garment.
46
Increased Disposable Income and Purchasing Power of Customer opens New Market Development. Emerging Retail Industry and Malls provide huge opportunities for the Apparel, Handicraft and other segments of the industry. In NCL greater Investment and FDI opportunities are available.
Threats
Changes in the external environmental also may present threats to the firm. Some examples of such threats include:
Competition from other developing countries, especially China. Continuous Quality Improvement is need of the hour as there are different demand patterns all over the world. Elimination of Quota system will lead to fluctuations in Export Demand. Threat for Traditional Market for Power loom and Handloom Products and forcing them for product diversification. Geographical Disadvantages. International labor and Environmental Laws. To balance the demand and supply. To make balance between price and quality
47
In Order to solve the problem the company must fire those employees who are giving continuous poor performance in spite of job rotation and training. Company must use external recruitment firms like Personnel consultancies, Management recruitment consultants, and Executive search firms to hire the best employees as these companies are the expertise. The Nishat Mills must not hire the retired employees on contract and give more and more chances to the new talent. Nishat Chunian Ltd needs to improve its advertisement campaign as the results shows that the company advertisement process is not very effective and the best candidates are not attracted. Company also needs to motivate its employees in a better way like bonus commissions promotions and increment at the same time.
The result of performance appraisal should be discussed directly with the employees and should be kept up-to-date with their both negative and positive aspects. This can be done by arranging meetings etc.