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Major Project Report: 1.1 Introduction To The Study
Major Project Report: 1.1 Introduction To The Study
CHAPTER: 1
INTRODUCTION
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Secondary objectives
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CHAPTER: 2
INDUSTRY
PROFILE
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1. INTRODUCTION
The cement industry is one of the main beneficiaries of the infrastructure boom. With robust
demand and adequate supply, the industry has bright future. The Indian Cement Industry with
total capacity of 165 million tones is the second largest after China. Cement industry is
dominated by 20 companies who account for over 70% of the market. Individually no company
accounts for over 12% of the market. The major players like L&T and ACC have been quiet
successful in narrowing the gap between demand and supply. Private housing sector is the major
consumer of cement (53%) followed by the government infrastructure sector. Similarly northern
and southern region consume around 20%-30% cement while the central and western region are
consuming only 18%-16%.India is the 2nd largest cement producer in world after china .Right
from laying concrete bricks of economy to waving fly overs cement industry has shown and
shows a great future. The overall outlook for the industry shows significant growth on the back
of robust demand from housing construction, Phase-II of NHDP (National Highway
Development Project) and other infrastructure development projects. Domestic demand for
cement has been increasing at a fast pace in India. Cement consumption in India is forecasted to
grow by over 22% by 2009-10 from 2007- 08.Among the states, Maharashtra has the highest
share in consumption at 12.18%,followed by Uttar Pradesh, In production terms, Andhra Pradesh
is leading with 14.72% of total production followed by Rajasthan. Cement production grew at
the rate of 9.1 per cent during 2006-07 over the previous fiscal's total production of 147.8 mt
(million tons). Due to rising demand of cement the sales volume of cement companies are also
increasing & companies reporting higher production, higher sales and higher profits. The net
profit growth rate of cement firms was 85%.
Cement industry has contributed around 8% to the economic
development of India. Outsiders (foreign players) eyeing India as a major market to invest in the
form of either merger or FDI (Foreign Direct Investment). Cement industry has a long way to go
as Indian economy is poised to grow because of being on verge of development. The company
continues to emphasize on reduction of costs through enhanced productivity, reduction in energy
costs and logistics expenses. The cement sector is expected to witness growth in line with the
economic growth because of the strong co-relation with GDP. Future drivers of cement demand
growth in India would be the road and housing projects. As per the Working Group report on
Cement Industry for the formulation of the 11th Plan, the cement demand is likely to grow at
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2. CURRENT SCENARIO
The Indian cement industry is the second largest producer of quality cement, which meets global
standards. The cement industry comprises 130 large cement plants and more than 300 mini
cement plants. The industry's capacity at the end of the year reached 188.97 million tons which
was 166.73 million tons at the end of the year 2006-07. Cement production during April to
March 2007-08 was 168.31 million tons as compared to 155.66 million tons during the same
period for the year 2006- 07.Despatches were 167.67 million tons during April to March 200708 whereas 155.26 during the same period. During April-March 2007-08, cement export was
3.65 million tons as compared to 5.89 during the same period. Cement industry in India is
currently going through a consolidation phase. Some examples of consolidation in the Indian
cement industry are: Gujarat Ambuja taking a stake of 14 per cent in ACC, and taking over DLF
Cements and Modi Cement; ACC taking over IDCOL; India Cement taking over Raasi Cement
and Sri Vishnu Cement; and Grasim's acquisition of the cement business of L&T, Indian Rayon's
cement division, and Sri Digvijay Cements. Foreign cement companies are also picking up
stakes in large Indian cement companies. Swiss cement major Holcim has picked up 14.8 per
cent of the promoters' stake in Gujarat Ambuja Cements (GACL). Holcim's acquisition has led to
the emergence of two major groups in the Indian cement industry, the Holcim-ACC-Gujarat
Ambuja Cements combine and the Aditya Birla group through Grasim Industries and Ultratech
Cement. Lafarge, the French cement major has acquired the cement plants of Raymond and
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3. PROCESS TECHNOLOGY
While adding fresh capacities, the cement manufacturers are very conscious of the technology
used. In cement production, raw materials preparation involves primary and secondary crushing
of the quarried material, drying the material (for use in the dry process) or undertaking a further
raw grinding through either wet or dry processes, and blending the materials. Clinker production
is the most energy intensive step, accounting for about 80% of the energy used in cement
Production. Produced by burning a mixture of materials, mainly limestone, silicon oxides,
aluminum, and iron oxides, clinker is made by one of two production processes: wet or dry; these
terms refer to the grinding processes although other configurations and mixed forms (semi-wet,
semi-dry) exist for both types. In the dry process, the raw materials are ground, mixed, and fed
into the kiln in their dry state. In the wet process, the crushed and proportioned materials are
ground with water, mixed, and fed into the kiln in the form of slurry. Different types of cement
that are produced in India are:
Ordinary Portland cement (OPC):
OPC, popularly known as grey cement, has 95 per cent clinker and 5 per cent gypsum and other
materials. It accounts for 70 per cent of the total consumption.
Portland Pozzolana Cement (PPC):
PPC has 80 per cent clinker, 15 per cent pozzolana and 5 per cent gypsum and accounts for 18
per cent of the total cement consumption. It is manufactured because it uses fly ash/burnt
clay/coal waste as the main ingredient.
White Cement:
White cement is basically OPC - clinker using fuel oil (instead of coal) with iron oxide content
below 0.4 per cent to ensure whiteness. A special cooling technique is used in its production. It is
used to enhance aesthetic value in tiles and flooring. White cement is much more expensive than
grey cement.
Portland Blast Furnace Slag Cement (PBFSC):
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4. PROCEDURE
The main raw materials used in the cement manufacturing process are limestone, sand, shale,
clay, and iron ore. The main material, limestone, is usually mined on site while the other minor
materials may be mined either on site or in nearby quarries. Another source of raw materials is
industrial by-products. The use of byproduct materials to replace natural raw materials is a key
element in achieving sustainable development.
Raw Material Preparation
Mining of limestone requires the use of drilling and blasting techniques. The blasting techniques
use the latest technology to insure vibration, dust, and noise emissions are kept at a minimum.
Blasting produces materials in a wide range of sizes from approximately 1.5 meters in diameter
to small particles less than a few millimeters in diameter. Material is loaded at the blasting face
into trucks for transportation to the crushing plant. Through a series of crushers and screens, the
limestone is reduced to a size less than 100 mm and stored until required. Depending on size, the
minor materials (sand, shale, clay, and iron ore) may or may not be crushed before being stored
in separate areas until required.
Raw Grinding
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In the wet process, each raw material is proportioned to meet a desired chemical composition and
fed to a rotating ball mill with water. The raw materials are ground to a size where the majority
of the materials are less than 75 microns. Materials exiting the mill are called "slurry" and have
flow ability characteristics. This slurry is pumped to blending tanks and homogenized to insure
the chemical composition of the slurry is correct. Following the homogenization process, the
slurry is stored in tanks until required. In the dry process, each raw material is proportioned to
meet a desired chemical composition and fed to either a rotating ball mill or vertical roller mill.
The raw materials are dried with waste process gases and ground to a size where the majority of
the materials are less than 75 microns. The dry materials exiting either type of mill are called
"kiln feed". The kiln feed is pneumatically blended to insure the chemical composition of the
kiln feed is well homogenized and then stored in silos until required.
Preprocessing
Whether the process is wet or dry, the same chemical reactions take place. Basic chemical
reactions are: evaporating all moisture, claiming the limestone to produce free calcium oxide,
and reacting the calcium oxide with the minor materials (sand, shale, clay, and iron). This results
in a final black, nodular product known as "clinker" which has the desired hydraulic properties.
In the wet process, the slurry is fed to a rotary kiln, which can be from 3.0 m to 5.0 m in diameter
and from 120.0 m to 165.0 m in length. The rotary kiln is made of steel and lined with special
refractory materials to protect it from the high process temperatures. Process temperatures can
reach as high as 1450oC during the clinker making process. In the dry process, kiln feed is fed to
a preheated tower, which can be as high as 150.0 meters. Material from the preheated tower is
discharged to a rotary kiln with can have the same diameter as a wet process kiln but the length is
much shorter at approximately 45.0 m. The preheated tower and rotary kiln are made of steel and
lined with special refractory materials to protect it from the high process temperatures.
Regardless of the process, the rotary kiln is fired with an intense flame, produced by burning
coal, coke, oil, gas or waste fuels. Preheated towers can be equipped with firing as well. The
rotary kiln discharges the red-hot clinker under the intense flame into a clinker cooler. The
clinker cooler recovers heat from the clinker and returns the heat to the preprocessing system
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6. DEMAND DRIVERS
Indian cement demand skewed towards housing
The demand from the housing sector is ~53% of the total Indian cement demand. There are fears
of a slowdown in the demand from the housing sector due to a drop in real estate prices in the
country. The worry is that builders may postpone construction of new buildings if the property
prices were to correct.
Infrastructure to give demand a big boost
Our analysis shows that Infrastructure should be the biggest growth driver for cement demand in
the country. If we were to look only at order books of the top eight construction and
manufacturing equipment companies in India, we find that their combined order book has
virtually doubled over the last two years from INR1,000bn (USD25bn) to INR1,950bn
(USD48.75bn) for completion over the next 24-30 months.
7. COST
Over the past five years, cost of cement production has grown at a CAGR of 8.4%. Also, the
producers have been able to pass on the hike in cost to consumers on the back of increased
demand. Average realizations have increased from Rs. 1,880 per ton in FY 03 to Rs. 3,133 per
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8. Government Policies
Government policies have affected the growth of cement plants in India in various stages. The
control on cement for a long time and then partial decontrol and then total decontrol has
contributed to the gradual opening up of the market for cement producers. The stages of growth
of the cement industry can be best described in the following stages:
Price and Distribution Controls (1940-1981)
During the Second World War, cement was declared as an essential commodity under the
Defense of India Rules and was brought under price and distribution controls which resulted in
sluggish growth. The installed capacity reached only 27.9 MT by the year 1980-81.
Partial Decontrol (1982-1988)
In February 1982, partial decontrol was announced. Under this scheme, levy cement quota was
fixed for the units and the balance could be sold in the open market. This resulted in extensive
modernization and expansion drive, which can be seen from the increase in the installed capacity
to 59MT in 1988-89 in comparison with the figure of a mere 27.9MT in 1980-81, an increase of
almost 111%.
Total Decontrol (1989)
In the year 1989, total decontrol of the cement industry was announced. By decontrolling the
cement industry, the government relaxed the forces of demand and supply. In the next two years,
the industry enjoyed a boom in sales and profits. By 1992, the pace of overall economic
liberalization had peaked; ironically, however, the economy slipped into recession taking the
cement industry down with it. For 1992-93, the industry remained stagnant with no addition to
existing capacity.
Government Controls
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9. REQUIREMENTS
Coal
The consumption of coal in a typically dry process system ranges from 20-25% of clinker
production. This means for per ton clinker produced 0.20-0.25 ton of coal is consumed. This
contributes 35-40% of the production cost. The cement industry consumes about 10mn tons of
coal annually. Since coalfields like BCCL supply a poor quality of coal, NCL and CCL the
industry has to blend high-grade coal with it. The Indian coal has a low calorific value (3,5004,000 kcal/kg) with ash content as high as 25-30% compared to imported coal of high calorific
value (7,000-8,000 kcal/kg) with low ash content 6-7%. Lignite is also used as a fuel by blending
it with coal. However this process is not very common.
Electricity
Cement industry consumes about 5.5bn units of electricity annually while one ton of cement
approximately requires 120-130 units of electricity. Power tariffs vary according to the location
of the plant and on the production process. The state governments supply this input and hence
plants in different states shall have different power tariffs. Another major hindrance to the
industry is severe power cuts. Most of the cement producing states like AP, MP experience power
cuts to the tune of 25-30% every year causing substantial production loss.
Infrastructure
To reduce uncertainty relating to power, most of the leading companies like ACC, Indian Rayon,
and Grasim rely on captive power plants. A few companies are also considering powergenerating windmills.
Limestone
This constitutes the largest bulk in terms of input to cement. For producing one ton of cement,
approximately 1.6 ton of limestone is required. Therefore, the cement plant location is
determined by the location of limestone mines. The major cash outflow takes place in way of
royalty payment to the central government and cess on royalties levied by the state government.
The total limestone deposit in the country is estimated to be 90 billion tons. AP has the largest
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The cement industry has much strength to be considered. Cement is, literally, the building
block of the construction industry. Almost every building constructed relies on cement for its
foundation. The cement business is a $10 billion industry, measured by annual cement
shipments. There is also a strong reputation behind the cement industry. Cement is a solid
material and consumers rarely have complaints about the product. Regional distribution plants
have also made cement widely available to any type of buyer.
Weaknesses
The cement industry is not without its drawbacks. The cement industry relies on
construction jobs to create a profit. But the cement industry heavily relies on weather. About
two-thirds of cement production takes place between May and October. Cement producers often
use the winter months to produce and stockpile cement, to meet demand. Another weakness is
the cost of transport; the cost of transporting cement is high and this keeps cement from being
profitable over long distances. In other words, shipping cement costs more than the profit from
selling it.
Opportunities
The cement industries have opportunities as well. One such opportunity is the cement
industry's efficiency. The cement industry has recently streamlined its production efforts, using
dry manufacturing instead of wet, which is heavier and more time-consuming. The cement
industry has also invested about $6 billion in expansion efforts to meet unmet cement needs.
Projections show that by 2012, the cement industry will have 25 percent more production
capabilities.
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The nature of the economy has uncovered a number of threats to the cement industry. The
cement industry greatly relies on construction. The current economy has lessened the number of
construction jobs, which in turn hurts the cement industry. The cement industry controls the
majority of the United States market, but not all of it. About 11.5 metric tons of cement are
imported annually to support the unmet need. If other countries can produce and ship cement for
a reduced price, the U.S. cement industry is in danger. The U.S. government is also attempting to
regulate the cement industry's waste. The Environmental Protection Agency has introduced
regulations for the cement industry to cut down emissions.
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CHAPTER: 3
COMPANY
PROFILE
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Company profile
Malabar Cements Limited is a high tech manufacturing company in the public sector, situated in
Walayar, palakkad district. Incorporated in the year 1978, the company commenced production
in 1984. The company, through its eighteen years of operation, could survive and prosper even
during the present era of liberalization and globalization.
Since 1996, company started consolidation, modernization and technical up gradation
phase to improve upon profitability, cutting production cost, improving the efficiency to face the
competitive environment. MCL achieved ISO-9002 certification in November 1996 being the
first cement factory in the public sector in the country. The major efforts of the modernization
and up gradation fronts are realigning and computerized operation of the kiln system, installation
of 2.5MW multi fuel diesel generator, belt bucket elevator etc. company could reduce production
cost and inefficiency due to these efforts.
The company achieved all time record performance during the year 1999-2000. MCL is
the first public sector company to receive the converted national award for energy conservation
from NCBM, New Delhi. Malabar cements contribute to the developmental activities of the state
by supplying a basic construction material. The presence of Malabar in the market helps to
control the cement price to some extent. MCL has the largest dealer network in Kerala for
cement sales. Only Malabar cements can reach its cement factory.
Fresh without any deterioration in the original strength either due to moisture or
humidity, within 12 hrs anywhere in Kerala. Company has systems to educate the consumers
usage of cement and provide after sales services.
Malabar Cements Limited, a fully owned Government of Kerala undertaking, is the only
major integrated cement manufacturing unit in the state. The company was incorporated in 11
th
April 1984 at its walayar plant. The company has a paid up equity of Rs 26 crores and capital
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The customers
Malabar Cements Ltd marketing has always the customer centered, consumer satisfaction
wowed in product quality and after sales services. Not only that super quality is build in to the
produce through very sophisticated computerized process control system the dedicated and
dynamic quality control system the this superior product features are consistently maintained.
Objectives of MCL
1. To manufacture and supply quality cement at reasonable prices by making an optimum
profit
2. To ensure fair dealings with customers
3. To provide employment opportunity for the public
Quality policy
The employee of MCL commits to comply with all requirements to continually improve
the effectiveness of the quality management system and arrives.
1.
2.
3.
4.
Credentials
Company could win several awards in the field of energy conservation, pollution control
and safety. The company has received the following awards
1. State award for the best performance in energy conservation 1995 from the state
electricity inspectors
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Competitors
The main competitor of Malabar cements are sankar, corometal, L&T, ACC, RAASI,
Chettinad and others
MD
G
M
GM(
CC
TS)
GM(
E)
CE(M)
FM
MM
OM
HR
PDN
PRCSE
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GM(M)
MD-Managing Director
GM-General Manager
GM (E)-General Manager (ENG)
CE (M)-Chief engineer (MECH)
GM (M)-General Manager (Mins)
CC-Chief chemist
GM (TS)-General Manager (tech service)
FM-finance
MM-marketing
OM-operations
HR-human resource
PDN-production
PURCSE-purchase
Product profile
Malabar Cements is simony for super quality, claim thousands of their customers spread
throughout the state. In Malabar cements, product improvement is not a onetime strategy for
boosting sales on the product life cycle theory. It is quest of excellence. Perfecting the product
quality is everybodys concern here. Our distinction begins with scientifically selecting the best
raw material for clinker. Stringent quality control is exercised in relending raw materials,
clinkerisation. Clinker gridding, and finally into cement packaging.
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Malabar super
Malabar super is fabulous in every sense: super in strength, wonderful in work ability,
incredible in aging, implausible in durability, and fantastic in strength gain. An AMAZING
performer!
Tests carried out by bureau of Indian standards have established unshakeable credentials
of Malabar super. Super strength accelerated setting time and fine finish. Malabar super is
superior in strength to ordinary 43 grade cement. It attains the 28 days strength required as per
IS just in 7 days time. Not only that, the strength attained in 28 days time is about 50% more than
the IS specification. The amazing strength of Malabar super arises out of its unequalled particle
fineness, 33% more than the IS specification and consistency in composition, more possible by
computerized process control system
Product characteristics
Malabar super offers better setting characteristics prolonged initial set and short final set
timings; providing more time for concrete mixing and placing, and less time for keeping the
concrete undistributed, free from movement and vibration, the property engineers and mansions
relish to have, in the cement they work with. Malabar super is finer when compared to normal
OPC, meaning rate of hydrogen and rate of strength gain is best
Benefits
Malabar super superiors setting properties, quick early strength gain, and higher finished
strength, gives at least 10% cement reduction in volume batching. By designing the mix,
reduction in cement requirement can go beyond 30% under good production and placement
practices. Malabar super is therefore economical
Malabar classic
Malabar classic offers better setting properties delayed initial set and early final set offering
better working time and reduced observation time, it is a superior class of its own among
cements
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Product characteristics
The cement most suited to the south Indian climate proudly invented by us, through in house
studies and continues researchers in product improvement a way of life in MCL. An outcome of
this is Malabar classic. With scientifically proportioned sand and coarse aggregates, the most
cohesive mix possible with Malabar classic, will avoid the otherwise in the rent drawbacks of
concrete segregation and bleeding. The fly ash interweaved with Malabar classic makes it
sulphate resistant; a basic property, that cement should posses, for constructions and structures in
sea co and in alkaline waters. Malabar classic is best suited to resist alkali aggregate reaction, a
defect eventually resulting in excessive cracks and subsequent unserviceability of structures.
Benefits
The extra fineness welded in to it allows Malabar classic better coverage and finish in wall and
roof plastering. This in turn reduces the paint consumption, with its superior strength properties,
it is economical to use Malabar classic. 10% cement is normally guaranteed. Using a design mix
gain can go up to 30%
Malabar aiswarya
Malabar aiswarya brings prosperity in many ways. It increases the life of your structures by
safeguarding against sulphate attack. Aiswarya offers high quality at reduced price.
Aiswarya generates less heat of hydration, reduces the formation of getting cracks. This product
is best studied for constructions in soil and water with excess alkali metals, sulphates, alumina,
iron and acidic waters. To obtain the best quality cement, only glassy granulated slag is used for
product manufacturing. With very low magnesium oxide content this provides shape stability for
concrete structures.
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Major players
The major players in the current sector are:
Ultratech cement
Century cement
Madras cement
ACC
Gujarat Abuja cement limited
Grasim industries
India cements limited
Jaiprakash associates
JK cements
Lafarge
Heidelberg cement
Vision
MCL industrial units have a capital outlay of Rs. 69 cores. The factory is rated to produce Rs 4.2
lakh tones cement per annum (24000 bags per day). The company meets about 10% of the total
cement consumption of Kerala and the company will reach near 13% of total consumption by
2010 and the company will achieve self sufficient its own power supply.
Mission
Achieving prosperity through quality
In a society where there is steep erosion of value and at time when relationship are
getting strain day by day. MCL a well run public sector company of the state, committed to the
society nurtures a corporate theme of building values strengthening relationship which also
relevant to its products.
Ownership pattern
MCL is fully owned by the government of Kerala. Initially there were some loans taken
by the company, which is fully repaid now. Government share capital currently is 2500 87 lakhs.
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Managers (P&A)
1) Supervision and guidance to the officers in P&A department on respective matters
2) Formulation of policies and strategies in connection with all matters related to P&A
All matters related to personnel, industrial relations, labor welfare, and advertisement, health,
legal, security, and statutory regulations related to P&A department of the including plant, mines,
CGU and other officers
Malabar cements ltd has a large but dedicated and skilled workforce. The personnel/human
resource department is the big at the same time important department of the company. The
department is headed by MPA (manager personnel & administration).
The department performs the following functions
Recruitment
Training & development
Wage & salary administration
Promotion
Performance appraisal
Canteen administration
Welfare activities
Safety activities
In MCL human resource are classified into two main categories. They are
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Selection
Selection is a process of choosing the most suitable person out of all applicants. The purpose
of selection is to pick up the right person for right job. No organization can achieve its goals
without selecting the right people.
Selection process
Test
Interview
Physical examination
Employment
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Final approval
In MCL tests are conducted only when the number of applicants is proportionately more.
Medical examination is compulsory before induction
Interview
The interview board consists of
Government nominee
Subject expert
Personnel & administrative manager
Managing director
Only after the acknowledgement of all the interview board members the applicant gets
selected
Placement
Once the candidate is employed there is probation period of 1 year during which his/her
performance is assessed quarterly. Based on the performance employee is made permanent.
Internal training
It is a house training which is given by MCL to its employees and it
broadly covers safety aspects, operations, emergency institutions etc.
External training
In external training the employee is trained by an outside institution
regarding new technology which is to be introduced in the plant. It is
given when it is found necessary.
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Working hours
Workers must work 8hrs/day. There are three shifts for the factory workers.
The working time will be rotated for each worker, so that every worker should work for all the
three shifts. There are 25 working days in a month. Working time for office staff is 8.30 am to 5
pm.
Compensation
MCL pays compensation to the employees in exchange for their valuable contribution to
the organization. All permanent employees of MCL should be included in group personnel
accidental insurance. An employee will get compensation either due to
A welfare fund board is functioning in MCL in which every employee should be a member. The
fund provides a certain amount to the diseased persons family Rs 2500 for the funeral expense
of the employee and a lump sum amount to his family and also job to his dependents.
Wage payment
Employees of MCL are categorized into two namely
Managerial
Non managerial
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Incentives
Incentives are decided by the recognized union and company. MCL follows production
cum profit linked incentives to regular employees.
Leave
For every 20 days of work the employee will get 1 day leave
12 sick leave
12 casual leave
Every 4 th Saturday of the month will be holiday for to the office staffs
Bonus
Every person is eligible for minimum bonus as per the payment of bonus act. Bonus
percentage will be demand at government level.
Employee grievances
MCL employees have every freedom approach the welfare officer to redress their
grievances. On close talk with the employees there it was found that the employees had opinion
about the management and they even said that the management never hesitate in giving away
their duties and rights, and even looked into fulfilling better welfare schemes.
Personal records
A personal record of all the employees is kept in MCL from their joining date up to their
date of retirement. Separate files of each employee are kept in MCL.
Fringe benefits
Workers enjoy ESI hospital facility. The company has a dispensary in the employee
township.
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Workers are given 2 pairs of shoes and uniforms every year. Rain coats are provided
Recreation facility
MCL also providers recreational facilities to its employees such a club facilities, sports
and cultural activities.
Trade union
There are three registered trade unions in MCLINTUC (Indian national trade union), CITU
(central Indian trade union) and STU. The representatives of these trade unions will have the
membership in committee, safety committee, canteen committee etc
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Works committee
Canteen committee
Safety committee
Labor welfare committee
Allowances
The various allowances are
Dust allowances
Union allowances
Medical allowances
Industrial relations
A good employee employer relation is important to the smooth functioning of an
organization. Industrial relations mean not only the complex relation between the trade union and
the management but also refer to the general way of relationships normally obtaining between
employees and employers.
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CHAPTER: 4
LITERATURE
REVIEW
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Theoretical background
Performance appraisal system is one of the oldest and most universal practices of management. It
is widely used technique to evaluate the people. Formal appraisal of an individuals performance
began in china in 221-265 AD. Later on in 1883, the New York City civil service in USA
introduced formal appraisal program shortly before the World War 1. US Army adopted the man
to man rating system evaluating military personal. In India the formal appraisal system started
after World War 2 nd. In the early fifties performance appraisal technique was called merit rating
and to use for technical, managerial, and professional personal.
Meaning
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Definitions
According to Scot, clothier and spreigal.Performance appraisal is a process of evaluating an
employees performance of a job in terms of its requirements.
Edwin B Flippo defines, performance appraisal system is the systematic, periodic and so far as
humanly possible, an impartial training of an employees excellence in matters pretaing to his
potentialities for a job.
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Assessment center
Human resource accounting
Behavioral anchored rating scales
MBO
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CHAPTER: 5
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RESEARCH
METHODOLOGY
5.3 Population
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one,
using
close
ended
questionnaire
for
our
research
study.
Questionnaire survey method was adopted for completing the data collection in this research.
5.9 SECONDARY DATA:
The data has been collected from companys profile, journals, websites, Reference book and past
record.
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Central tendency
A measure of central tendency is a single value that attempts to describe a set of data by
identifying the central position within that set of data. As such, measures of central tendency
are sometimes called measures of central location. They are also classed as summary
statistics. The mean (often called the average) is most likely the measure of central tendency.
The mean, median and mode are all valid measures of central tendency but, under different
conditions, some measures of central tendency become more appropriate to use than others
Mean (Arithmetic)
The mean (or average) is the most popular and well known measure of central tendency. It
can be used with both discrete and continuous data, although its use is most often with
continuous data. The mean is equal to the sum of all the values in the data set divided by the
Page 61
This formula is usually written in a slightly different manner using the Greek capitol letter, ,
pronounced "sigma", which means "sum of...":
Ranking method
A method of handling data which has the same observed frequency occurring at two or more
consecutive ranks; it consists of assigning the average of the ranks as the rank for the
common frequency.
Some of them did not fill the questionnaire due to lack of time
Some of the employees didnt respond in a positive manner
Most of the employees feared to disclose the fact
Page 62
CHAPTER: 6
Page 63
DATA ANALYSIS
AND
INTERPRETATION
A) GenderTable no 1
Gender
Males
Female
Total
No: of respondents
92
8
100
% of respondents
92
8
100
Chart no 1
MESCE Department of Management Science
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No: of respondents
120
100
80
No of respondents
60
40
20
0
Males
Female
Total
Interpretation:From the above table and graph, it is found that majority of the employees are male (92%) and
only 8% are female. It is inferred that most of the employees employed there in the organization
are males.
B) Marital status
Table no 2
Marital status
Married
Unmarried
Total
No: of respondents
83
17
100
% of respondents
87
13
100
Chart no 2
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No: of respondents
120
100
80
No of respondents
60
40
20
0
Married
Unmarried
Total
Interpretation:From the above table and graph, it was found that majority of the respondents are married (83%)
and only 17% are unmarried. It is inferred that most of the respondents are married.
C) Work shifts
Table no 3
Services
Day shift
Night shift
Rotation shift
General shift
Total
No: of respondents
38
8
46
8
100
Percentage
38
8
46
8
100
Chart no 3
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NO:OF RESPONDENTS
120
100
80
60
NO.OF RESPONDENTS
40
20
TO
TA
L
SH
RO
IFT
TA
TI
O
N
SH
G
IFT
EN
ER
AL
SH
IFT
IG
H
T
N
DA
Y
SH
IFT
Interpretation:From the above table and graph, it can be seen that majority of the respondents (46%) work in
rotation shift, 38% of the respondents work in day shift and only 8% of respondents are work in
night shift and general shift. It is inferred that most of the employees work on rotation shifts in
the organization.
D) Year of Experience
Table no 4
Services
Less than
3
3-5 years
More than 5
Total
No: of respondents
Percentage
0
92
100
92
100
Page 67
60
40
20
0
Less than 3 3-5 years More than 5
Total
Interpretation:From the above table and graph, it can be seen that majority of the respondents (92%) have more
than 3 years of experiences. only 8 % of respondents have less than 3 year of experience. It is
inferred that most of the respondents have better work experience in the present company.
No: of respondents
100
0
100
Percentage
100
0
100
Chart no 5
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NO:OF RESPONDENTS
120
100
80
NO.OF RESPONDENTS
60
40
20
0
YES
NO
TOTAL
Interpretation:From the above table and graph, it can be seen that all the respondents (100%) are aware about
the performance appraisal system in the organization.
Opinion
Wage determination
For promotion
Improve performance
Others
Total
No: Of respondents
0
34
66
0
100
Percentage
0
34
66
0
100
Page 69
NO: OF RESPONDENTS
120
100
80
60
40
20
0
to
ta
l
an
ce
pe
rfo
rm
Im
pr
ov
e
W
ag
e
de
te
rm
in
at
io
n
NO.OF RESPONDENTS
Interpretation:From the above table and graph, it can be seen that majority (66%) of the respondents favored
towards improve performance and 34% respondents favored for promotion. It is inferred that
most of the respondents are considering that performance appraisal purpose is for improving the
performance of employees.
No: of respondents
11
34
20
35
100
Percentage
11
34
20
35
100
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NO: OF RESPONDENTS
120
100
80
60
NO.OF RESPONDENTS
40
20
To
ta
l
Jo
b
kn
ow
le
dg
e
O
ut
pu
t
Interpretation:From the above table and graph it is seen that majority (35%) of the respondents are considering
work related skill, 34% of respondents are considering quality of work, 20% of respondents are
considering output and only 11% of respondents are said job knowledge. It is inferred that most
of the respondents consider quality of work for the evaluation of their performance.
Opinion
Quarterly
Half yearly
Yearly
Other
Total
No: of respondents
25
25
50
0
100
Percentage
25
25
50
0
100
Chart no 8
MESCE Department of Management Science
Page 71
NO.OF RESPONDENTS
120
100
80
60
NO.OF RESPONDENTS
40
20
To
ta
l
ot
he
r
Ye
ar
ly
Q
ua
rt
er
ly
H
al
fy
ea
rly
Interpretation:From the above table and graph it is be seen that majority (50%) of the respondents preferred
yearly based evaluation and 25% of respondents preferred quarterly and half yearly. It is
inferred that majority of the respondents expect yearly based evaluation.
Appraiser
Department head
Immediate
No: of respondents
80
9
Percentage
80
9
superior
Hr department
Others
Total
11
0
100
11
0
100
Chart no 9
MESCE Department of Management Science
Page 72
NO: OF RESPONDENTS
To
ta
l
en
t
NO.OF RESPONDENTS
H
rd
ep
ar
tm
D
ep
ar
tm
en
th
ea
d
120
100
80
60
40
20
0
Interpretation:From the above table and graph it is seen that majority (80%) of the respondents prefer
department head, 11% of the respondents prefer human resource department and only 9% of
respondents prefer immediate superior as their appraiser. It is inferred that most of the
respondents prefer to have department head as their appraiser.
No: of respondents
10
70
20
0
0
100
Percentage
10
70
20
0
0
100
Chart no 10
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NO: OF RESPONDENTS
120
100
80
60
40
20
0
AT
IS
FI
ED
D
IS
S
H
IG
H
LY
SA
TI
SF
IE
D
NO.OF RESPONDENTS
Interpretation:From the above table and graph, it can be seen that, 10% of the respondents are highly
satisfied with the present appraisal system, 70% of the respondents are satisfied and 20% of
the respondents are neutral opinion. It is inferred that most of the respondents are satisfied
with the present appraisal system in the organization.
No: of respondents
appraisal 35
method
Ranking method
Grading method
Others
Total
33
32
0
100
Percentage
35
33
32
0
100
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NO: OF RESPONDENTS
NO.OF RESPONDENTS
To
ta
l
Se
lf
ap
pr
ai
sa
lm
et
ho
d
G
ra
di
ng
m
et
ho
d
120
100
80
60
40
20
0
Interpretation:From the above table and graph, it can be seen that majority (35%) of the respondents viewed
that the organization followed self appraisal method, 33% of respondents experienced
ranking method and 32% of the respondents experienced grading method. It is inferred that
the majority of the respondents had experienced self appraisal method.
No: of respondents
78
22
100
Percentage
78
22
100
Chart no 12
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NO: OF RESPONDENTS
120
100
80
NO.OF RESPONDENTS
60
40
20
0
YES
NO
TOTAL
Interpretation:From the above table and graph, it can be seen that majority (78%) of the respondents wants new
method and 22% of the respondents are do not expect any change. It is inferred that most of the
respondents are in need of new method for performance appraisal.
9. Preferred method
Table no 13
Methods
MBO
720 degree method
360 degree method
Others
Total
No: of respondents
6
70
2
0
78
Percentage
6
70
2
0
78
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NO: OF RESPONDENTS
90
80
70
60
50
40
30
20
10
0
To
ta
l
O
th
er
s
m
et
ho
d
de
gr
ee
36
0
72
0
de
gr
ee
M
BO
et
ho
d
NO.OF RESPONDENTS
Interpretation:From the above table and graph, it can be seen that majority (70%) of the respondents prefer 720
degree method,6% of respondents prefer MBO and only 2% of respondents prefer 360 degree
method. It is inferred that most of the respondents prefer to have 720 degree method for
evaluating their performance.
No: of respondents
11
89
0
0
0
100
Percentage
11
89
0
0
0
100
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NO: OF RESPONDENTS
120
100
80
60
40
20
0
AT
IS
FI
ED
D
IS
S
H
IG
H
LY
SA
TI
SF
IE
D
NO.OF RESPONDENTS
Interpretation:From the above table and graph, it can be seen that 11% of the respondents are highly satisfied
and 89% of respondents are satisfied. It is inferred that most of the respondents are satisfied with
their overall performance in the last year.
No: of respondents
100
0
100
Percentage
100
0
100
Chart no 15
Page 78
No: of respondents
120
100
80
No of respondents
60
40
20
0
Yes
No
total
Interpretation:From the above table and graph it can be seen that all of the employees agree that the present
appraisal system is not time consuming.
No: of respondents
100
0
100
Percentage
100
0
100
Page 79
No: of respondents
120
100
80
No of respondents
60
40
20
0
Yes
No
total
Interpretation:From the above table and graph it can be seen that all respondents agree with the statement that
the organization supports the values and culture for evaluating performance appraisal
No: of respondents
16
17
0
Percentage
16
17
0
Page 80
67
100
67
100
Chart no 17
No: of respondents
120
100
80
60
40
20
0
to
ta
l
pl
oy
ee
s
of
em
sa
tis
fa
ct
io
n
Jo
b
Ev
al
ua
tio
n
of
em
pl
oy
ee
s
No of respondents
Interpretation:From the above table and graph it can be seen that majority (67%) of the respondents agreed
with employee motivation, 17 % of respondents with promotion of employees, 16 % of
respondents with the evaluation of employees as the reason for which performance appraisal is
being done. It is inferred that the performance appraisal is done for the employee motivation.
14. The
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No: of respondents
Yes
No
Total
67
33
100
Percentag
e
67
33
100
Chart no 18
No: of respondents
120
100
80
No of respondents
60
40
20
0
Yes
No
total
Interpretation:From the above table and graph it can be seen that majority (67%) of the respondents gave
positive criticism regarding performance appraisal and 33% of respondents responded in a
negative manner. It is inferred that majority of the respondents are having a positive opinion
towards performance appraisal.
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No: of respondents
8
10
0
82
Percentage
8
10
0
82
100
100
Chart no 19
No: of respondents
120
100
80
No of respondents
60
40
20
to
ta
l
Th
re
e
O
ne
Interpretation:From the above table and graph can be seen that majority (82%) of the respondents have
attended more than three,10% of respondents attended two and only 8% respondents attended
one training programme. It is inferred that most of the respondents have attended more than
three training programmes.
Page 83
Opinion
On the job training
Off the job training
Total
No: of respondents
63
37
100
Percentage
63
37
100
Chart no 20
No: of respondents
120
100
80
60
40
20
0
To
ta
l
O
ft
he
O
n
th
e
jo
b
jo
b
tr
ai
ni
ng
tr
ai
ni
ng
No of respondents
Interpretation:From the above table and graph it can be seen that majority (63%) of the respondents prefer
on the job training method and 37% of respondents prefer off the job training. It is inferred
that most of the respondents prefer on-the-job training for the better performance.
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Rank
Percentage
294
233
148
517
14.59
11.56
7.34
25.67
objectives
468
Guideline for training plan
An insight into your strengths and 354
23.23
17.57
weakness
Total
100
2014
Chart no 21
Rank
Salary administration
and benefits
Determination of
promotion or transfer
Decision on layoff
Assistance in
achieving goals and
objectives
Total
Interpretation:From the above table and graph, the majority (25.67) of the respondents are expected from the
performance appraisal assistance in achieving goals and objective. It is inferred that most of the
respondents consider performance appraisal as assistance in achieving goals and objectives.
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Rank
Percentage
495
466
448
439
485
444
488
468
487
450
10.59
9.97
9.59
9.40
10.38
9.50
10.44
10.02
10.42
9.63
4670
100
Chart no 22
Rank
Job knowledge
Planning, organizing,
& controlling
Communication
Creativity
Cost consciousness
Developing
subordinates
Relationship
Leadership
Judgment
Total
Interpretation:From the above table and graph majority (10.59%) of the managers have good job knowledge
(the level of knowledge in regards to all phases of his/her work including knowledge of latest
trends and development in the area and the ability to put them to use) and the lowest rate for the
creativity (ability and interest in developing and putting into practice new and beneficial ideas or
MESCE Department of Management Science
Page 86
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Job knowledge
Relationship
Judgment
Cost consciousness
Leadership
Planning, organizing, and controlling
Potential for handling higher level responsibility
Communication
Developing subordinates
Creativity
system
Table no 23
Factors
Strongly agree
Agree
Mean value
5
4
Page 87
3
2
1
Chart no 23
Mean value
Strongly agree
Agree
Neutral
Disagree
Strongly disagree
Interpretation:From the above table and graph the respondents strongly agree with the present appraisal system.
The present appraisal system is fully effective and respondents are satisfied with the system
followed by the organization.
Page 88
CHAPTER: 7
FINDINGS,
SUGGESTIONS,
CONCLUSION
Findings
70% of employees are satisfied with the present appraisal system followed by the
organization.
Majority of the employees are male, married and have more than 5 years of experience.
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82% of the employees have attended more than three training programmes.
All of them are aware about the performance appraisal system followed in the
organization.
66% of employees agree that the main purpose of performance appraisal is to improve
their performance.
35% of employees view that the main factor for considering the evaluation of
performance.
55% of employees agree that good relationship between superiors and the subordinates is
being maintained in the work premise.
Suggestions
better performance.
There should be training sessions to improve team building aspects.
Page 90
In the beginning of the year itself, employee must know the performance standards on
which his/her performance will be judged at end of year.
Performance appraisal should be done at regular intervals rather than doing them
annually.
Conclusion
This study was done to provide Malabar Cements a full insight into the employees
perception regarding the effectiveness of performance appraisal system in the organization. After
conducting a deep study it was found that majority of the employees are of the view that the
companys present appraisal system is effective as far as the present methods used are concerned.
Also the employees got benefitted through performance appraisal, as the results are used for
promotion. The employees suggest that there should be pre-performance and post performance
counseling mechanism to be introduced in the organization.
MESCE Department of Management Science
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