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1.1 INTRODUCTION Prevalent from the birth of mankind, man involved himself in one or another business through sole proprietorship and partnership form of business. But these forms appeared to be less perpetual, because of unlimited liability and affections by natural factors viz death, insolvency or lunacy of the owner or partners. Then company form of organization came into existence which changed the ‘populi’ view of doing business. An organization is defined as “a consciously coordinated social unit composed of two or more people that functions on a relatively continuous basis to achieve a common goal or set of goals”. In other way round it can also be defined as “a form of every human association for the attainment of a common purpose or goal”. Thus in a way the term organization emphasizes upon “the human groupings/associations and whose main objective is to meet certain predefined goals that may vary from profit motive to serving the society as well as the nation”. An organizational study is the study of individual and group dynamics in an organizational setting, as well as the nature of the organizations themselves. Whenever people interact in organizations, many factors come into play. Organizational studies attempts to understand and model these factors. Being a part of the curriculum under 2 years MBA program, we got the opportunity to carry out one such organizational study in a large cap public company. The objective of this study was to enjoin the students with the functioning of the organization, as also of its departments. The main aim of the organizational study is to acquire the knowledge regarding the functional as well as the management aspects of an organization, and its sustainability towards achieving its mission, vision and values set for growth. 1.2 TITLE OF THE STUDY Organisation study on “ZIM LABORATORIES LIMITED”
1.3 OBJECTIVES OF THE STUDY • • • • • • To know about the market structure within which the organization is a player. To know about the market share and share of competitors. To understand key issues in strategy deployment like mission, vision, goals, objectives etc. To study the organizational administrative structure. To understand as to how different functional areas of an organization work together to achieve common objective of the firm. To study key business levels functions and process like Marketing, Finance, HR, Operations, etc. 1.4 SCOPE OF ORGANISATIONAL STUDY
The study focuses on the overall structure of the organization. In this study, the researcher analyzed the overall functioning of the firm and also the financial performance of the enterprise. The researcher made a moderate attempt to have the SWOT analysis of the study. The researcher also experienced practical application of the theoretical knowledge gained 1.5 LIMITATIONS of the Study
As the project is prepared for the academic purpose only, it suffers from the
limitation of time, due to which the detailed report about the operations of the organization was not possible. • • The information given by the persons may not be complete because of their busy The report suffers from the limitation of meeting only the departmental heads work schedules because of lack of permission to interact with other people. Certain areas are restricted, so a detailed study is not possible.
Annual reports etc.There was a keen sense of observation followed during the study period to follow the various functions of the company. world.It includes organization data derived from internet. like External Data. and other Organization structures. Internal Data.1. Observation. information media that gives a wide picture of the Organization with respect to the external Schedule time frame Time period: Data collection: Data analysis: Report preparation: Submission of report: 25 days (17-10-09 to 14-11-09) 7 days (22-10-09 to 28-10-09) days ( -11-09 to -11-09) days ( -11-09 to -11-09) 14-11-09 Page No. 2. Balance sheet.4 . Secondary Data 1. and there was a questionnaire that was followed as questions which were asked depending upon situations.There were interview sessions with each of the functional heads.This includes data provided at the company’s office. 2.6 METHODOLOGY used for Organization study Primary Data 1. Personal Interview.
CHAPTER 2 INTRODUCTION TO THE PHARMACEUTICAL INDUSTRY Page No.5 .
Belgium and the Netherlands following suit.2 GLOBAL SCENARIO Page No. Key discoveries of the 1920s and 1930s. 2. became mass-manufactured and distributed. The industry got underway in earnest from the 1950s. Legislation was enacted to test and approve drugs and to require appropriate labeling. and markets drugs licensed for use as medications. Pharmaceutical companies can deal in generic and/or brand medications. From 1978. Switzerland. By the 19th century. The first known drugstore was opened by Arabian pharmacists in Baghdad in 754. Pharmaceutical manufacturing became concentrated. produces. testing and marketing of drugs. By the mid-1980s.2. due to the development of systematic scientific approaches. with a few large companies holding a dominant position throughout the world and with a few companies producing medicines within each country. The earliest drugstores date back to the Middle Ages. such as insulin and penicillin. which led to the formation of mutually beneficial partnerships with large pharmaceutical companies and a host of corporate buyouts of the smaller firms.1 INTRODUCTION The pharmaceutical industry develops. Most of today's major pharmaceutical companies were founded in the late 19th and early 20th centuries. Numerous new drugs were developed during the 1950s and mass-produced and marketed through the 1960s. and many more soon began operating throughout the medieval Islamic world and eventually medieval Europe. with the UK. Prescription and non-prescription drugs became legally distinguished from one another as the pharmaceutical industry matured. small biotechnology firms were struggling for survival. US. many of the drug stores in Europe and North America had eventually developed into larger pharmaceutical companies.6 . India took over as the primary center of pharmaceutical production without patent protection. Germany and Italy had particularly strong industries. Cancer drugs were a feature of the 1970s. understanding of human biology (including DNA) and sophisticated manufacturing techniques. They are subject to a variety of laws and regulations regarding the patenting.
Africa. greater penetration of health insurance. Top 14 Pharmaceuticals Markets. b. The market has grown at a CAGR of nearly 11% during 1998-2005. The semi and non regulated markets of Asia. expansion of medical infrastructure. Semi Regulated and Non Regulated markets. Global Sales 2005 : US$ 602 billion The top 10 Pharma companies are facing prospects of slowdown in sales as a large number of blockbuster drugs that they possess are going off patent. rising prevalence of chronic diseases. Australia and Latin America have been growing at a rapid pace (registering double digit growth in 2005) highlighting the tremendous market potential of these regions. a. 2. adoption of product patents.Global Pharmaceuticals Market 1. According to McKinsey & Company report (“India Pharma 2015). and aggressive market penetration driven by the relatively smaller companies. The pharmaceutical markets worldwide can be classified as Regulated. Size of the global pharmaceutical market was US$ 602 bn. The regulated markets constitute 88% of the global pharmaceutical market.7 . the following trends are expected to influence the growth of the Indian pharmaceuticals market over the next decade: doubling of disposable incomes and the number of middle-class households. 2015 Page No. 2005 Top 14 Pharmaceuticals Markets.
1 STRATEGIES ADOPTED BY GLOBAL MARKET PLAYERS Generic Exports • The global generics market is expected to continue growing rapidly due to the underlying demand drivers like an aging global population. The Japanese market is poised to become an important destination for many global generic players with the introduction of generic substitution in 2006. • Currently the Indian industry is estimated to account for 22% of the world generics market which is expected to reach 30% according to the forecasts of Assocham. the largest generics market globally. Page No.2.8 . • USA . is also the single largest export market for Indian generics.US $ billion US $ billion 2. growing healthcare expenditure and low generic penetration across large geographical areas.
especially China and Israel . drug intermediates. • Custom manufacturing operations in India or China offer unparalleled cost advantages and increasing pricing pressures is forcing innovators to minimize manufacturing costs and shift operations to India and China . Page No. tablets. Around 70% of the country's demand for bulk drugs. capsules.3 INDIAN SCENARIO “The Indian pharmaceutical industry is a success story providing employment for millions and ensuring that essential drugs at affordable prices are available to the vast population of this sub-continent.” Richard Gerster Pharmaceutical Industry in India is one of the largest and most advanced among the developing countries.• Low production costs give India an edge over other generics-producing nations. From simple pain killers to sophisticated antibiotics and complex cardiac compounds. • India is also an apt destination for outsourcing of research services due to its large population with relative underexposure to drugs. 2. It provides employment to millions and ensures that essential drugs at affordable prices are available to the vast population of India. chemicals.9 . pharmaceutical formulations. Indian Pharmaceutical Industry has attained wide ranging capabilities in the complex field of drug manufacture and technology. CRAMS • Rising pricing pressure on global revenues and falling trend in R&D productivity is making it imperative for global pharma players to increase outsourcing to sustain profitability. almost every type of drug is now made indigenously. Indian Pharma Industry is playing a key role in promoting and sustaining development in the vital field of medicines. which would have been difficult to obtain otherwise. • Indian custom manufacturing players have been aggressively acquiring custom development companies in the EU in order to gain access to a wide gamut of valuable client relationships. significant cost advantage and the availability of well qualified investigators.
The Indian pharmaceutical industry registered strong growth during the Ninth and Tenth Five Year Plan periods and has emerged as an area of strength especially in generics. Dr. This has resulted in the Indian pharmaceutical players offering their products at some of the lowest prices in the world. which is next only to that in the US. The companies have their strategies in place to leverage opportunities and appropriate values existing in formulations. generics. Indian pharmaceutical industry is undergoing fast paced changes. has not dampened the robust growth but has improved the overall IPR environment. This is further triggered by the fact that generics worth over $40 billion are going off patent in the coming few years which is close to 15% of the total prescription market of the US.10 . having risen more than 12times since 1990. Wockhardt. 1 January 2005. The industry has thrived so far on reverse engineering skills exploiting the lack of process patent in the country.e. bulk drugs.orals and vaccines is met by Indian pharmaceutical industry. Page No. Multinational companies have traditionally dominated the industry. Exports have also grown significantly to over Rs.f. The Indian pharmaceutical companies have been doing extremely well in developed markets such as US and Europe. Biotechnology etc. which is another trend seeing a reversal. The adoption of world-class patent laws for pharmaceutical products w. The quality of the products is reflected in the fact that India has the highest number of manufacturing plants approved by US FDA. The turnover of the industry was Rs. India has become one of the leading global players. pursuant to the obligations under the WTO Agreement. notable among these being Ranbaxy.72000 crore during 2006-07.24942 crore in 2006-07 accounting for as much as 34% of the turnover. The Indian Generics market is witnessing rapid growth opening up immense opportunities for firms. holding fourth position in terms of volume and thirteenth position in terms of value of production. Reddy’s Labs. Nicholas Piramal and Lupin. Novel Drug Delivery Systems. Cipla. A number of Indian pharmaceutical companies adhere to highest quality standards and are approved by regulatory authorities in USA and UK. New Chemical Entities.
There is already an established international industry and business community. It has an educated work force and English is commonly used.1 Advantage India (i) Competent workforce: India has a pool of personnel with high managerial and technical competence as also skilled workforce. it has more than 70 million middle class market. Professional services are easily available. Biotechnology Research 5. R&D is the starting of the industry value chain and is also the most important value creator. Companies that involve in R&D do so in specific areas.3.000 entities and the organized sector consisting of about 300 entities.Currently. and the commercial potential. (ii) Cost-effective chemical synthesis: Its track record of development. Page No. (iii) Legal & Financial Framework: India has a 58 year old democracy and hence has a solid legal framework and strong financial markets. particularly in the area of improved cost-beneficial chemical synthesis for various drug molecules is excellent. Kinds of Research : 1. The market is also very fragmented with about 30. It provides a wide variety of bulk drugs and exports sophisticated bulk drugs. it is the Indian companies which are dominating the marketplace with the local players dominating a number of key therapeutic segments. Basic R & D 2. Process Research & Reverse Engineering 3. Analogue or Discovery Research 4. Globalization: The country is committed to a free market economy and globalization. Consolidation is increasing in the industry with many local players building a global outlook and also growing inorganically through mergers and acquisitions. NDDS(New Drug Delivery System) Research 2. They chose specific therapeutic areas to target based on their strengths in the market. (iv) (v) Information & Technology: It has a good network of world-class educational institutions and established strengths in Information Technology.11 . Above all. The Key to success in this industry is research & development.
838 bn) 10.9.20.16. Aurobindo Pharma (2007 Turnover – Rs. Glaxo SmithKline Pharma(2007 Turnover – Rs. Lupin Labs (2007 Turnover – Rs.17. The process of consolidation. Ipca Laboratories (2007 Turnover – Rs. Cadilla Healthcare (2007 Turnover – Rs. which has become a generalized phenomenon in the world pharmaceutical industry. (vi) Consolidation: For the first time in many years. the international pharmaceutical industry is finding great opportunities in India.96 bn) 2.635 bn) 5. 2. Aventis Pharma (2007 Turnover – Rs. Dr. Cipla (2007 Turnover – Rs.801 bn) 7.155 bn) 6.622 bn) 3.41.1 THE STRATEGIES ADOPTED BY MARKET PLAYERS Business Strategies followed by Indian Pharmaceutical Companies Page No.734 bn) 8.12 .13 bn) 9.Reddy’s Laboratories (2007 Turnover – Rs.37.9. Ranbaxy Laboratories(2007 Turnover – Rs.which is continuously growing.4 TOP 10 MARKET PLAYERS IN PHARMA INDUSTRY 1.804 bn) 2.637 bn) 4.4.24. has started taking place in India.251.22. Sun Pharma Industries (2007 Turnover – Rs.
Page No. new generation under-patent formulations are imported. This cost advantage is in the fact that: . There are also 5 Central Public Sector Units that manufacture drugs.Indian Pharmaceutical sector is highly fragmented with more than 20. India is largely selfsufficient in case of formulations. chemicals having therapeutic value and used for production of pharmaceutical formulations. by MNCs.13 . The leading 250 pharmaceutical companies control 70% of the market with market leader holding nearly 7% of the market share. Some life saving. These units produce complete range of pharmaceuticals.Most infrastructure facilities are much cheaper in India than in developed countries. More than 85% of the formulations produced in the country are sold in the domestic market. 2. Over 60% of India's bulk drug production is exported and the balance is sold locally to other formulators.2 DISCOVERY R & D IN INDIA The Indian industry has attained cost advantages in process research used for generic drugs & value added generics production. which accounts for 60-80 percent of total sales.e. which they market in India. i..4.000 registered units and is very top heavy. which include medicines ready for consumption by patients and about 350 bulk drugs.
Indian companies ignored basic research and concentrated their R&D efforts toward producing drugs through alternative processes. Indian industry instead mastered the art of reverse engineering to gain competitive advantage. Biocon & Dr.. Reddys who are willing to take the risk of investing millions in building research capabilities and developing molecules. Consequently. There is very little private initiative to invest in R&D.3 CHANGING SCENARIO OF INDIAN R&D The acceptance of provisions of the agreement on TRIPS is expected to change the orientation of Indian companies towards R & D. This also evident in the data of patent granted in the country where the top firms granted patents are mostly MNCs.Inadequate profit base: The price control has squeezed the profit margins making it difficult for Indian and international companies to cull out and invest sizable sums in R&D. The more value added basic research methodologies are being pursued by very few players like Ranbaxy. The profitability of Indian companies is also much lower than international levels.Indian scientists can be attracted at much cheaper rates than their US counterparts. with industry chipping in with 10% to 12%.4. Indian companies have started investing in complex R & D activities like novel drug delivery system and new drug discovery. The pre-tax profit margin of pharmaceutical companies in India is much less than 6% on sales in sharp contrast to the 18% profit margins common to international companies. .Lack of Product Patent protection: The delayed adoption of TRIPS in India is cited as the major impediment to the possible investment by international companies in India.Lower costs: R&D expenditure in India is far lower than in the developed countries. total expenditure on R&D was low (multinational pharmaceutical players spend about 1316% of total sales on R&D). which is a very small number. The cost Page No. The advantages of conducting R & D in India are given below: . Investments made in R&D by the Indian pharmaceutical companies would yield 3-4 molecules a year. The government continues to bear the burden. as the industry structure did not provide Indian firms incentives have invested to very invest little in in R&D in basic India research.14 . The cost differentials are due to lower costs in machinery and human capital. 2. due to: . In the absence of product patents.
advantages can only be exploited if the necessary funds required can be sourced. 2. an organisation can increase it’s success by adopting strategies which manipulate these factors to it’s advantage. Such R&D activities will be targeted towards segments such as antibiotics.15 . • Pest Factors – These are external forces which the organisation does not have direct control over these factors. Following India’s acceptance of the provision of Trade Related Intellectual Property Rights (TRIPS) under the GATT agreement.Population advantages: A larger population base would facilitate clinical trials for diseases especially prevalent in developing countries.5 PEST ANALYSIS An organisation’s success is influenced by factors operating in it’s internal and external environment. . Economical Social and Technological). • Micro environmental factors – These are internal factors. PEST is an acronym and each letter represents a type of factor (Political. anti-parasitics and other anti-bacterials. A successful organisation will not only understand existing factors but also forecast change. investments are expected to start flowing into the area of basic research. which the organisation can control. so that it can take advantage of change within the environments in which it operates. Indian R&D efforts could be directed towards infectious diseases that are especially prevalent in Asian countries. Page No.
Diagram: PEST analysis and the marketing mix. Ineffective voluntary codes and practices will often lead to governments introducing legislation to regulate the activities covered by the codes and practices. Page No. Manufacturers are now free to produce any drug duly approved by the Drug Control Authority. adverse publicity and imprisonment in certain cases. Factories Act 1948 and allied labour and industrial laws also affect the working in the industry. Besides the industry is also subjected to provisions under the TRIPS.16 . POLITICAL FACTORS ANALYSIS It is the first element of the study of PEST Analysis. since the players have to function within the desired provisions. Non conformance with these legislative obligations can lead to sanctions such as fines. Pharmaceutical Industry in India has been de-licensed and industrial licensing for most of the drugs and pharmaceutical products has been done away with. Indian pharmaceutical industry got a major boost with the signing of General Agreement on Tariffs and Trade in January 2005 with which India began recognizing global patents. The application of provisions relating to Minimum Wages Act.
which includes implementation of VAT. The rural markets grew by over 40 percent during the calendar year 2006. Besides there have been a number of regulatory developments since 2005. For example. ECONOMIC FACTORS ANALYSIS The second element of a PEST analysis involves a study of economic factors.17 . a shift in excise duty levy to MRP based levy and the enactment of product patent regime. The top 10 Pharma companies are facing prospects of slowdown in sales as a large number of blockbuster drugs that they possess are going off patent. National and global interest rate and fiscal policy will be set around economic conditions. Prevalence rates of key chronic diseases in India Percent of population Looking at the recession period and in order to lower labor costs and savings in manufacturing costs.The pharmaceutical industry has thrived so far on reverse engineering skills exploiting the lack of process patent in the country. All businesses are affected by national and global economic factors. The climate of the economy dictates how consumers. several Indian pharmaceutical companies have acquired companies in the US and Europe and many others are raising funds to do so. suppliers and other organisational stakeholders such as suppliers and creditors behave within society. Ranbaxy acquired Romania's Terapia. Ethimed NV of Belgium and GSK's generic business Allen Page No. The higher growth in acute therapy segments – pain/ analgesics and Anti-Infectives can be attributed to the fact that epidemics (dengue & chikungunya) were more prominent in rural areas.
Organisations must be able to offer products and services that aim to complement and benefit people’s lifestyle and behaviour. friends. The companies have also to a great extent been able to change the philosophy of timid Indian towards spending on medicines through aggravating marketing advertisements. A number of pharmaceutical companies have therefore come out with such drugs and syrups. which includes the machinery. A distinguishing feature of the pharmaceutical industries in India is the large scale investment by big pharma companies in the research and development. Companies like Glenmark Pharma. Lupin. The standard of living of people has increased to a great extent. that will help people to maintain health and be happy. ex.Revital. software and hardware equipments used in information exchange system and in managing the business. Dr Reddy's acquired German generic drug maker Betapharm. According to industry statistics at global level. to a great extent. Here to. neighbours and the media. Indian people.18 . only about one in ten thousand chemical compounds discovered by pharmaceutical industry researchers proves to be both medically effective Page No. Gone were the days when medicines and herbs used to be purchased based on monetary factor. SOCIAL FACTORS ANALYSIS The third aspect of PEST focuses its attention on forces within society such as family. colleagues. TECHNOLOGICAL FACTORS ANALYSIS The last element in the PEST study is the analysis of technological factors. doctors and physicians play an important role in furthering the advantages of medicines. and they desire to spend more for maintaining their health and status. Besides the growing population of India.SpA in Italy. also provides ample market place for the pharmaceutical companies to diversify their selling area. Aurobindo and Jubilant Organosys are on the lookout for lucrative acquisitions. If organisations do not respond to changes in society they will lose market share and demand for their product or service. are becoming health conscious.
Has 1 Malaria NCE in Phase II Conducting clinical trials on Oral Insulin and Monoclonal Antibody for inflammation Has launched another Monoclonal Antibody for head and neck cancer Has 1 oncology NCE in Phase II and plans to have 7-8 NCEs in clinical trials over the next few quarters Conducting phase II trials on the anti-psoriasis NCE Has out-licensed 2 of its NCEs to global pharma companies Sun Pharma Ranbaxy Biocon NPIL Lupin Glenmark 2. Also focused on 3 other NCE projects and 4 very promising NDDS platforms Has out-licensed a novel statin to PPD . However an ability to react quickly also creates extra pressure as businesses are expected to deliver on their promises within ever decreasing timescales. has a very strong biogenerics programme One NCE in Phase II trials in USA . The discovery R&D pipeline of Indian pharma players has been seeing a steady build up over the years. Leading Indian companies have started to look beyond generics and are investing in discovery R&D (NCE/ NDDS research) for sustainable long term growth.and safe enough to become an approved medicine. This technological revolution has increased the rate at which information is exchanged between stakeholders. Also partnering with innovative companies on specialty drugs.19 . which is described below: Page No. Technology has created a society which expects instant results. and about half of all new medicines fail in the late stages of clinical trials. Company Dr Reddy's Labs Overview of discovery R&D programme 2 NCEs in Phase II and another 4 NCEs in Phase I along with a significant number of pre-clinical candidates. A faster exchange of information can benefit businesses as they are able to react quickly to changes within their operating environment.6 PORTER’S FIVE FORCES ANALYSIS The most influential analytical model for assessing the nature of competition in an industry is Michael Porter's Five Forces Model.
Figure: Porter’s Five Forces Model for Industry Analysis Porter explains that there are five forces that determine industry attractiveness and longrun industry profitability. Key barriers to entry include • • In industry Economies of scale is very slow because it take time to achieve to customer loyalty and whole growth is dependant on the loyalty factor only.20 . These five "competitive forces" are: • • • • • The threat of entry of new competitors (new entrants) The threat of substitutes The bargaining power of buyers The bargaining power of suppliers The degree of rivalry between existing competitors Threat of New Entrants New entrants to an industry can raise the level of competition. For new entrants. it’s a very big challenge to establish business because heavy amount of capital and investment is required. The threat of new entrants largely depends on the barriers to entry. Page No. which may cause in reducing its attractiveness. In Pharmaceutical industry it is easy to enter but talking about Products it is tough because it depend on the reliability of customer.
The relative price and performance of substitutes affects the usage of the organizations drugs. The cost of items bought from suppliers (e. substitutes price.• Distribution of drugs and vaccines plays a major role with out which it is not possible for manufacturer to reach prospective customers. If suppliers have high bargaining power over a company. it’s difficult thereafter to divert customer mind to other substitutes. Supplier is said to have high bargaining power where the product sold by him has no substitute or even very close substitute. once competitor gets customer reliability(loyalty). The bargaining power of suppliers will be high when: ➢ In an industry there are many buyers and few suppliers. ● In pharmaceutical industry.g. These type of co-existence also affects to a great extent the functioning of small and medium scale organizations. This factor may apply to new entrants in industry.21 . Bargaining Power of Suppliers Suppliers are those business houses that supply raw materials & other products to the industry. The New entrants find it difficult to cope up with this problem.e. Threat of Substitutes The presence of substitute products in pharmaceutical industry can lower industry attractiveness and profitability because they limit price levels. raw materials. price plays a major role and it’s totally dependant on market price of the goods i. Recent acquisition of Ranbaxy by Daiichi Sankyo will not only help Daiichi to strengthen its roots in the Indian Pharmaceutical industry. then in theory the company's industry is less attractive. which go a long way in manufacturing the product. which are generally taken up by already substantiable organizations. The threat of substitute products depends on: ● In pharmaceutical industry. components) can have a significant impact on a company's profitability. but will affect the market share of other pharmaceutical organizations also. But in pharmaceutical industry there are many buyers and many suppliers so bargaining power over a company is not much. We can also infer here the entry of consolidated/amalgamated corporates or newly acquired organization. Page No.
• Despite the exit barriers. since it is a business to business market and the buyer here are the wholesalers. Pharmaceutical companies that offer patented drugs with distinctive medical benefits have more power over hospitals. health maintenance organizations. and other drug buyers than those drug companies offering generic (non-patented) products.➢ The industry is not a key customer group to the suppliers. and progress through R & D. who can force the organization to produce only such class of drugs or vaccines which is more popular among their potential customers. all at the expense of industry profitability. Bargaining power of Buyers Powerful customers – the flip side of powerful suppliers – can capture more value by forcing down prices. In case of Industrial buyers. new product introductions. Page No. where there can be no expectation of bargaining by the buyers against the manufacturing industries. small pharma companies find it profitable to remain on track. and service improvements. if we talk of retail buyer. then he can be said to have low or no bargaining power in case of necessary drugs or vaccines. they can be said to have a moderate bargaining power. demanding better quality or more service (thereby driving up costs). Rivalry among existing competitors Rivalry among existing competitors takes many familiar forms. advertising campaigns. first. on the intensity with which companies compete and. But this situation varies in case of drugs of extreme necessity viz. more or less on an equal size and out of which about 250 are big pharma companies controlling 70% of the market share. on the basis on which they compete. secondly. the intensity of rivalry is very high because there are more than 20000 registered units. Pharmaceutical industry is the key customer to the supplier because for suppliers other buyers are few. But in case of pharmaceutical industry. cancer drugs. and generally playing industry participants off against one another. The degree to which rivalry drives down an industry’s profit potential depends. • In pharmaceutical industry. including price discounting.22 . High rivalry limits the profitability of an industry.
the pharmaceutical industry shows an upward trend in its core markets. The industry remains highly valued. The forecast of the leading 16 pharmaceutical companies for 2001 to 2007 suggests that combined sales will grow at a minimum rate of 5.2 percent based on the potential of their product pipeline. Such degree is very much required between the players in the pharmaceutical industry. Its future potential demand trend is positive and despite increased competition the industry still shows a continuing upward growth momentum. because they are also the provider of great employment opportunities in urban as well as rural sectors. Overall. has a favourable market position with strong financial make-up and strong earnings growth. Page No.23 .• • Big pharma companies in India are competing on the basis of R & D facility and through scheme of new drugs and vaccines.
The organization has been established under the shelter and support of Universal Group of Pharmaceutical Companies.24 .1 BACKGROUND AND HISTORY The Pharmaceutical sector is one where trends and technologies are in a state of flux. New breakthroughs in the world & Healthcare occur at a hectic pace. Page No.CHAPTER 3 COMPANY PROFILE 3. This demands for expertise & skill to stay ahead. one of the leading pharmaceutical group in central India. Zim Laboratories Limited exemplifies an organization displaying these very traits.
in md@zimlab. Award of the Best Managed Industry by D. Planning Commission of India. E-mail – bdd01@zillab. MIDC Area. Felicitation for contributing to Industrialization and other important.25 . India. Nagpur – 440002.of India.I. Govt.in 3.in Felicitation of Mr. Registration The as vendor by Ministry of Defence (Director General Quality Assurance).ZIM has made a significant mark as a maverick pharma innovator. organization’s systems and documents are in conformance with the ISO 9001:2000 Standards accredited by AQA of USA. ADDRESS Of Corporate Office and Works Place Corporate Office 545. Kalmeshwar – 441501.zimlab. by Award of Udyog Patra. The facilities provided by the organization are WHO CMP. and successfully demonstrating its commitment to its Missions & Goals. ZIM has established itself as one of the preferred healthcare solution providers in the field of New Drug Delivery Systems (NDDS).of Maharashtra. Page No. India. constantly penetrating newer areas of pharmaceutical business & technology. Shantinagar. areas to Mr. E-mail : email@example.com Website – www. Headquartered & set-up in the industrial belt of Nagpur City of Central India. but the Deputy Chairman. Managing Director by Central Institute of Business Management Research & Development.1.Daud.1 Accomplishments Works B-21/22.C.Vali. Chairman. for being an Eminent Industrialist. India). certified by Food and Drugs Administration. Zakir S.Anwar S.(Govt. ZIM & Associates are supported by excellent technical team & sufficient capacity to produce large requirements for different market segments.
well . ZIM has pioneered several innovative technologies & products particularly in the spheres of Pellets. distribution & marketing of pharmaceuticals in Allopathic & Herbal categories encompassing almost every dosage form. its products and services through following six core principles : • UNDERSTANDING markets & Customers Page No. Capsules. etc.organized Business this organization is in a support from conception to schedule and provides packaging development. Dry Syrups. SVPs (Injectables). Herbals & Diagnostics.26 . The wide appreciation for its quality and prompt services to clients. as well as in the international markets. Resinates. 3. Ointments. including Tablets.1. have ensured a strong presence in the domestic markets. customers.2 The Core Principles of ZIM The organization articulates its understanding of market. material sourcing assistance and developments of products based on client's specifications.ZIM & its Associate Companies are engaged in the activities of manufacturing. Liquid Orals. The Independent and Development Department at position to offer customer product delivery in a strict services ranging from product development and design. Powders. Multiparticulates & Modified Release Oral Solid Dosage Forms have been identified as a thrust area & key formulations developed. External Preparations. Multiplets.
. .. tryly innovative technologies with the potential to change the nature of human health & Page No.1 MISSION STATEMENT “We will exploit our Zeal for Excellence and Spirit of Innovation in the field of Medicine to ensure our position as a premier pharmaceutical manufacturing organization specialized in. • MARKET & SELL Products & Services • PRODUCE Products & Services...” 3.. • PROVIDE Customer Service. • DELIVER Products & Services.2 VISION STATEMENT "Making Quality Healthcare Affordable" “We believe that the pharmaceutical business is today poised for a great leap forward.2... thereby contribution to make available of High Quality Affordable Healthcare for the common man and meeting our Obligations to our Employees.2 MISSION AND VISION 3.. Investors and the Shareholders.2. • Niche Products and Markets. • Original Research based Herbals for Chronic aliments. 3... • Biotechnology based Products & Processes.27 .• DESIGN Products & Services..
We are committed towards providing our national & international clients an easy & timely access to sophisticated process technologies & products. Ever changing regulatory guidelines. aspire to play a significant role in making the fruits of such technologies available as affordable healthcare solutions. old-age & alternative therapy medicines pose challenge to every pharmaceutical organisation to manage and accelerate the drug development process. & to offer our customers innovative & exclusive quality products that differentiate them from their competitors & significantly impacts their bottom-line. That's why. There is a desperate need for solutions that emerge out of these innovative technologies to reach the common man at an affordable cost so that these benefits do not remain accessible only to the rich and affluent sections of society. globalization & evolving market such as those for nutritional supplements. give value for money. advances in drug therapy & delivery systems. Page No. Striving for Customer’s Satisfaction through all their actions. Uniquely positioned to provide expertised drug delivery systems. we support our own & customer's objectives with specialized formulations to reach the market faster & easier than ever.” 3. every day we continue to put our Zeal for Excellence and Spirit of Innovation into all our actions.longevity have already appeared and each day brings better & better innovations. We at ZIM. aiming for Customer Satisfaction.28 .3 GOALS AND THE VALUE DRIVEN CULTURE The following best explains the corporate philosophy which ZIM percolates through the entire organization and hence forms the core :- Pursuing Excellence through Continuous Innovations. drug industry Mergers Acquisitions. while respecting the rights of others. teaming with like-minded associates in the pharmaceutical technology business.2.
e. For this purpose and to serve an industry that is rapidly changing. customizing testing to meet client specifications through time-valued and cost effective tests at their facility. This is because of the sophisticated machinery and the great endeavor taken by the Business Development Department towards fulfilling the orders of the clients. The management very well believes in producing new drugs and vaccines that will help in the control of diseases. Less through-put time ZIM has mastered the strategy of involving less time in meeting up with the order of the clients. and contribution towards Disease-free ZIM is very much involved in the production of novel allopathic drugs. Less through–put time ensures the organization to cope up with the future orders and also ensures to maintain quality of the medicines and the drug processes. scientists and technical personnel with competence and experience to provide the following varied range of services : (i) (ii) Development and validation of formulations Analytical development i. 3. promotion of Education. Quality drugs and processes Page No. Transacting business with Integrity & Transparency. ZIM has assembled a team of researchers. Making Innovative Products our regard for Environment. Aspiring for a Responsible Corporate Citizenship through Humanity in constant harmony and Peace.29 . (iii) Performing and monitoring stability testings based on ICH guidelines. 3. 2. Respecting the Rights of all Stake-holders & Associates.3 SWOT ANALYSIS Strengths 1.
A well equipped Quality Control laboratory comprising sophisticated instruments manned by highly experienced technocrats ensure that the laid down quality policy aspects are strictly adhered to. Presently. This is done in a strict time schedule. Many a times. The BDD acts as the connecting link between the prospective clients of the organization and the company. facilitating the International Quality Standards with innovative services tailored to users need. and that too because of the quality drugs manufactured by it.30 . the order quantity poses a risk to production pattern and hence results in capacity constraint. which is nominated as Business Development Department. material sourcing assistance and developments of products based on the specifications or requirements of the clients. ZIM believes that Quality is a continuous process an not an isolated stage. 4. Moreover. special care is taken at every stage of the manufacturing process. the company is exporting Page No. and provides a standing in-house representation of the inside company. A unique feature of this department is that it provides services ranging from product development. ZIM has a highly developed and sophisticated customer care department. Opportunities Export Potential ZIM has great potentiality in the foreign markets because of its innovation driving mechanism which is very well required in this sector. Weaknesses Capacity constraint The organization faces the problem of meeting to the excess order requirements of the clients. packaging development and design.There is production of drugs and vaccines that meet more than upto the expectations of the clients. The independent and well-organized BDD is in a better position to offer customer support from development to delivery of product. Highly Sophisticated Customer Care department To be very well proficient with meeting the requirements of the customers and to stand up in the competitive era.
• Herbal single & multi-components pre-mixes. The reason why it places high dependence on export sales is because of its superior quality drugs and processes. Algeria. The organization is comprehended to the threat of operations of major domestic players like Ranbaxy Laboratories.processed excipients. • Enteric Release Formulations. Vietnam.component Formulations. Egypt. granules. Besides it has also covered several Central and South states in the domestic sector.Premixes & Granulates. Threats Competition from Indian organizations operating outside India Operating in the foreign markets requires huge investment besides facing a tough competition from the operation of domestic organizations in the foreign markets. The company sees a bright market prospect in the continents of Africa and America. Libya. Chattisgarh and Madhya Pradesh. Morocco. • Bio-availability Enhancement---. Iraq and Yemen. Glaxo SmithKline. • Non-Pareil Seeds & other pre.31 . Latin America. some of which are Bangladesh. and multiparticulates. which makes it one of the better manufacturers among its sector. some of which are Maharashtra. 3.. • Sustained Release Formulations.its products to more than 25 countries. Nigeria.4 PRODUCTS AND MARKETS PRODUCTS The following specific formulations are offered:• Taste and Odour Masked Formulations. • Immediate Release Stabilised Multi. • Stability Enhancement----. • Dual Release Formulations (Delayed Release With Enteric Coating Attributes). Sri Lanka. and others. Page No.Formulations & Powders . • Dispersible / Mouth Dissolving Tablets and their R C Granules. UAE.
32 .Ulcers AntiHypertensive Esomeprazole Atenolol Lansoprazole Omeprazole Pantoprazole Nicardipine Nifedipine Nitroglycerin Verapamil Anti-Allergics Chlorpheniramine Maleate Cetirizine/Levocetirizine Loratadine TABLETS Anti-Hypertensive Candesartan Cilexetil Carvdilol Diltiazem SR Losartan potassium & Ramipril Anti-Depressant Clomipramine HCl Citalopram Anti-Diabetic Glimepiride Metformin Metformin Repaglinide CAPSULES Anti-Bacterial Cefixime & Cefdinir Albendazole Cefuroxime axetil Fluconazole Ofloxacin Anti-Viral Didanosine Delayed Release Azithromycin Ciprofloxacin Gatifloxacin Roxithromycin Anti-Fungal Fluconazole Anti-Asthamatic Theophylline SR TASKS MASKS Cefixime Clarithromycin Levofloxacin Cefpodoxime proxetil Erythromycin ethyl succinate Nystatin Page No. This large volume capacity allows us to offer our customers products of consistent quality with reduced lead-times.Additionally. Some of the products in the above category manufactured by ZIM are : PELLETS Antiinflammatory Aspirin Ibuprofen Indomethacin Ketoprofen Tramadol AntiAsthamatics Aminophylline Hydrate Montelukast Sodium Chewable Hyperacidity. the company has the experience & ability to manufacture and supply large volumes of standard and customized finished formulations under different labels & brand names.
The Balanced Scorecard is such an innovative tool which has considered not just the financial indices but also the non-financial indicators as equally critical in determining organizational performance.5 BALANCED SCORE-CARD Analysis of the Organization using Balanced Score Card Approach: The success of any organization is reflected upon by its performance which is in turn highly dependent upon its strategies. By focusing not only on financial outcomes but also on the operational. which in turn helps organizations act in their best long-term interests.3. marketing and developmental inputs to these. but also managing the same. Due to these. Moreover. what an organisation requires is not just framing the right strategies. This tool brings a link between strategy and action. the Balanced Scorecard helps provide a more comprehensive view of a business. Page No. In this era of cut-throat competition.33 . the framework is gaining increasing importance among different business houses. The impact of the right strategies will automatically be reflected in the results. any organisation has to understand that it needs to give impetus not only towards the financial results but also towards satisfaction of the customers. development of state-ofthe-art technologies and creation of an environment of learning and growth. The balanced scorecard is a strategic performance management tool for measuring whether the smaller-scale operational activities of a company are aligned with its largerscale objectives in terms of vision and strategy.
34 .Balance Scorecard Phases Page No.
It aligns everyone within an organization so that all employees understand how they support the strategy. It communicates the objectives and measures to a business unit. It aligns the strategic initiatives in order to attain the long-term goals. The framework tries to bring a balance and linkage between the – (a) Financial and the Non-Financial indicators. This innovative tool is unique in two ways compared to the traditional performance measurement tools. The tool has given stress on the other areas which are required to ‘balance’ the financial perspective in order to get a total view about the organizational performance and improve the same. It defines the strategic linkages to integrate performance across organizations. 2. 4. 5. (c) Internal and the External aspects and (d) Leading and the Lagging indicators. It translates vision and strategy into action. 7.35 . 6. They are– (i) It considers the financial indices as well the non-financial ones in determining the corporate performance level. One of the tools for organizational appraisal that is gaining immense popularity is the Balanced Scorecard. and (ii) It is not just a performance measurement tool but is also a performance management system. It provides a basis for compensation for performance. developed by Robert S Kaplan and David P Norton in 1992. Advantages of using Balanced Scorecard approach : 1.The long-term success of any organization is determined by the capabilities and the competencies it has developed. Example of Balanced Scorecard A typical scorecard of an organization can be prepared as under: Page No. 3. (b) Tangible and the Intangible measures. The scorecard provides a feedback to the senior management if the strategy is working.
The Customer Perspective: The company satisfies its customers in an effective way and caters to the customer requirements very efficiently. They set goals according to national and international standards and accordingly they take effective measures to achieve them. company has negligible funding from outside sources. Since the company is an unlisted one.Observational Analysis of ZIM Laboratories The Financial Perspective: The company follows effective financial strategies to maintain stability in finance and allocation of funds. which looks out for overall satisfaction of its customers. The Process Perspective: Page No. Besides. there arises no questions of return to the shareholders. This has been carried out to a large extent by the highly efficient Business Development Department of the company.36 .
Page No. It focus here is on continuous improvement and value creation. The Innovation and Learning Perspective: In this area. It also look at measures for research and development. The above analysis has been carried on the basis of observations brought out during the organizational study. time/efficiency. by using the people resources most effectively. the company is examining measures relating to employee development.37 . and skills improvement. retention. Company generally follows production on the basis of orders generated from the customers. Note: Company doesn’t follow balanced score-card approach. logistics or sales and then set goals related to such things as quality.In process perspective also the company have a very specific goals regarding like production. in order to avoid wastage and spoilage. and cost reduction.
38 .CHAPTER 4 ORGANISATION STRUCTURE AND CRITICAL REVIEW Page No.
Maintenance. The way in which an organization is structured creates/restrains opportunities for interactions with other organizational members. Human Resources. Page No. etc. 5. The Matrix Structure. production. Federations A brief introduction to the above forms of organization structures is given below : Functional and Divisional structures The oldest and commonly used organization structure is functional structure. operations. R & D.1 Why Organizational Design ? Organizations have become the primary form of social institution in contemporary society.1. Following are the broad types of structural forms : 1. 4. customer. organization is departmentalized on the basis of products.4. Vertical and Horizontal structures 3. In case of divisional structure. Functional and Divisional structures 2. the organization is departmentalized on the basis of various functions performed by it viz. or region.1. In functional structure.3 What is Organizational design ? It is the process by which managers select and manage aspects of structure and culture so that an organization can control the activities necessary to achieve its goals.39 .2 Organizational structure The formal system of task and authority relationship that control how people coordinate their actions and use resources to achieve goals Structure facilitates effective response to problems of coordination and motivation 4. influencing the attitudes and social relations that emerge over time and the ways in which work related tasks are completed. Mechanistic and Organic structures 4.1. Organization structures may take different forms.
On the contrary. In other words. The essence of modified structure lies in the modifications to the classical principles of delegation of authority and standard of control. bringing skilled individuals together from different parts of the organization. organizations having a series of narrow span of control were termed as vertical structures. Page No. the organizational structure suitable to stable conditions was termed as mechanistic structure. both absolute centralization and decentralization are neither desirable nor possible. Matrix Structure The matrix organization structure was proposed by Dairs and Lawrence for Aero space programme of the United States. both these structure have their own advantages and disadvantages. They focus on project teams. Accordingly. each department reports simultaneously to both product managers and functional managers. Hence. In this structure. structures incorporating wide spans and limited layers of control at horizontal levels were called horizontal structures. However. Individuals were made responsible both to their line manager and the project manager involved. and employees report to both of them. The product managers and functional managers have equal authority within the organization. while the organizational structure which was considered appropriate to changing conditions was called organic structure.40 . Matrix forms of management can be regarded as an early form of 'network' structure. attempts were made to combine the advantage of product and functional departmentalization to achieve the organizational goals. Accordingly. this dual structure simultaneously organizes part of organization along product lines and part of the organization along functional lines to gain the advantages of both. In a matrix organization.Vertical and Horizontal structures In an organization. Mechanistic and Organic structures Two contrasting types of organizational structure were recommended by Bruns and Stalker in their study of twenty industrial firms in England. the writers and organizations began to explore ways to modify the two structures.
4.41 . CHAIRMAN Page No.Federations This form is a variant of the divisional organizational structure which has great importance because of its human resource factor. since the power of management control is divided between the Financial Director and Executive Director from the Managing Director. But this form of organization has attracted criticism from stock market analysts who find difficulty in comprehending its subtle informality. The federations is a loosely connected arrangement of businesses with a single holding company or separate firms in alliance.2 ORGANISATION STRUCTURE OF ZIM LABORATIES Zim Laboratories follows Horizontal form of organizational structure.
INWARD / OUTWARD INCHARGE ALL ASST. ALL ASST. The Chairman is concerned with policy making matters. OFFICER HR MANAGER SECURITY ASST.P.3 CRITICAL REVIEW of the Organizational Structure 1. R&DS R. EXEC ALL ASST. 4.42 .MANAGING DIRECTOR FINANCIAL DIRECTOR EXECUTIVE DIRECTOR PURCHASE OFFICER A/C OFFICER EDP ERP ADMIN. ALL ASST. ASST. OPERATION PROJECT INCHARGE OSD QC QA MANAGER MAINTENANCE ENGG. ALL ASST. ALL ASST. ALL ASST. PRODUCTION OFFICER ALL ASST. ACCOUNTANT ADMIN. Page No. ALL ASST. PURCHASE ALL ASST. PRODUCTION MANAGER STORE INCHARGE(FG) STORE INCHARGE(RM) STORE INCHARGE(PM) PERSONNEL OFFICER ALL ASST. VPBDD INTERNAL AUDIT INCHARGE MANAGER R&D V. ALL ASST.
the production. 4. to some extent. 3. Business Development Department b. 5. stores and personnel departments are under the control and supervision of Operations department. Operations f. this form of organization design poses a great challenge for him. The organization operates in a B2B market. Therefore he is burdened with the task of responding to each of them. Projects 7. wherein it is desirable to have a horizontal organization design. Internal Audit d. Page No. but also the purchase department. The Finance Director controls not only the accounts department. 9. The MD also supervises the working of the following departments / functions : a. which can have. Quality Control and Quality Assurance c. The Managing Director is entrusted with the functions of routine management. a demeaning effect on the working of the MD. 8. Like a just organization. EDP and ERP functions also.2. The Finance and the Executive Directors are under the supervision of the MD. 6. Since MD is to concern himself with the making of policies in an organization. The only misconception about this form of design is that the MD has to operate and hear from all the departments functioning within it. During the Board Meetings there has to be reporting of policies framed and exceptional functions performed during the routine management. Research and Development e.43 . which requires technical as well as functional expertise on his part.
CHAPTER 5 BUSINESS LEVEL FUNCTIONS AND PROCESSES 5.44 . Business Development Department Page No.1 FUNCTIONAL DEPARTMENTS OF ZIM LABORATORIES 1.
Production Department 10. Administrative Department 3. Raw Materials b. Packing Materials c. Materials Department a. Human Resources Department 14. Research & Development 6. Quality Control 9.1 Recruitment / Training and Development Process Vacancies Arise in the Respective department Job advertisement is given in the newspaper & Applications are collected The Resumes received are then scrutinized The Respective Head of Department further scrutinizes the application A Committee Panel is established and a date & time is decided from the Panel Candidates selected from Preliminary Interview are called for Final Interview Page No. Quality Assurance 8.2. Accounts Department 5. EDP & ERP 7. Maintenance Department 12.2 HUMAN RESOURCES DEPARTMENT 5. Purchase Department 4. Finished Goods & Dispatch 11.45 . Personnel Department 13.2. Marketing Department 5.
then if he/she has done some overtime work before. these credit hours are adjusted the emergency hours i. There is no payment for overtime work.2 Promotion Policy.2. Incentives and Leaves It was informed that there were no extra incentives to the employees apart from the monetary allowances. whenever employee wants to work less on any particular day of the week. Instead.2. then that overtime work hour is adjusted towards in such emergency situation.Selected candidates are called for Preliminary Interview Selection and Disbursal of Offer letters Appointment and Joining Formalities Induction Process Internal Training and Development Performance Appraisal (Self-Appraisal by employees) Appraisal by the Head of Department whose employees are evaluated Review with Committee Panel 5. This generally happens in case of family or social functions at the employees residence or in case of accident or other uncertainity of any of his/her family members. Performance. 5.e. Extra incentives are pointed out here in the sense of overtime work.3 Number of Employees Administrative Category of Employee Trainee On Probation Confirmed Posts Total Number 52 22 82 Total 156 Non-Administrative (Workers) Permanent workers 54 Page No.46 .
5. the usual process adopted is : Page No.e. and also for export purposes in some cases. they are marketed for the government and institutions. Canteen facility 6. Bus facility 7. In case of transaction with governments and institutions.2. Provident Fund 4. for the reason of it being the financial capital of India. Spoilage and Wastage 8.Casual (on contract basis) 300-400 5. In case of exports. In case of exports. Activities concerning welfare of employees 5.4 Matters dealt with by the department 1. no questionnaires nor behavioral method. Instead customers visit the factory outlets and place direct orders with the organization.2 Method of Marketing deployed The organization has not employed any of the direct marketing strategies i. Salary & Wages 2.3.47 . Scrap. 5. Sale of Scrap. Incentives and Bonus Payment 3.3.1 Role of the Marketing Department The Mumbai Office takes care of the Marketing function of the organization. while in case of finished goods. 5. Marketing is generally done of Finished goods and Semi-finished goods. there are also frequent visits by the Health Ministers and other top officials of the health department of the foreign country. only Semi-finished goods are marketed.3 MARKETING DEPARTMENT ZIM Laboratories has its registered office in Mumbai.
Sri Lanka. ISO 9001:2000 WHO Certification (for Export and Registration) NAFDAC (National Agency for Food & Drugs Administration and Control) which is helpful mostly for export of products in the country of Nigeria. Besides it has also covered several Central and South states in the domestic sector.8. Buyers directly approach the organization through informed visits to factory.48 . some of which are Bangladesh. Presently. Iraq and Yemen. However. Meeting customers through local agents appointed in that country. B. Country visit 2. Appointment of local agents in foreign country 3. 3rd Party Export It is selling goods locally in more than 15 countries. Tender participation 9. and thereafter places the order accordingly. Vietnam. Nigeria. Morocco. Where organization visits foreign country :1. Finally. ZIM holds – i. Contract Manufacturing The organization is involved in selling of allopathic drugs according the requirements of the customer i. Tender awarded 10. Libya. export marketing usually involves following steps : A.e. Algeria. UAE. 2. some of which are Maharashtra. Egypt. Export The organization has export in more than 25 countries. 5. Chattisgarh and Madhya Pradesh. Latin America.3. the company is exporting its products to more than 25 countries. supply of goods. iii. custom manufacturing. The greatest advantage of this type of strategy is that there is following of JIT system to the tune of 80- Page No.3 The Market Strategies or the Business Models 1. ii. 3.
it is the foreign entities who approach ZIM in order to purchase these machinery and equipments.etc. 6. It is the customer who directly approaches the organization either through 7. since production is carried out only after receiving the specification or requirements of the order.90%. This is just indirect manufacture. The organization holds a Certificate of registration from DGQA i. RDPL.Director General of Quality and Assurance for supply in Defence sector. 1. 5. Trade Marketing This comprises of own marketing of products. Government and Institutes ZIM also supplies drugs and syrups to government and allied institutions. Loan License Manufacturing Under this strategy. 4. In fact the manufacturing rights remained with ZIM and were displayed as ‘Marketed By : ZIM Laboratories’ on the tablet / capsule strips or syrups or related products.e. Trading ZIM also aids those organizations which find it difficult to import instrument parts and other quality control equipments for manufacturing purposes. as if to appear that the product has been marketed by that client. some of which are ESIC. WCL. 5.4 Sales Promotional Techniques ZIM follows basic promotional techniques and does not goes for mere technical tools. since these organizations face the problem of finding the right supplier. tools adopted are : Page No. In case of Trade Marketing. Many a times.3. wherein ZIM used to manufacture the drugs and medicines and dispatched them under the name and seal of the client. which excludes direct marketing techniques.49 . the organization used to sell/manufacture drugs with specific names of clients on the products as per its requirements.
Conferences, Gifts, Coupons and Prizes. 2. In case of Export Sales, tools and techniques adopted are : Bonus goods or free goods, Commission or Discount on further purchases. 3. In case of Marketing of products, ZIM provides only promotional materials to its customers, simply because the superior quality of products provided by it to them. 5.3.5 Marketing Information Systems Marketing Information Systems is generally brought in application of Age analysis of Debtors and Creditors of the organization. Age analysis means how old or for how much time the party is appearing as Debtor or Creditor in the Ledger of the organization. For this purpose, a provision is made to exclude a specific amount of debtors from the total amount. 5.4 FINANCE DEPARTMENT The recording of transactions with respect to purchase of raw materials, payment of revenue expenditure and receipts is regulated and functioned by the finance department in any organization. In fact, finance is considered to be the backbone of any organization, since it brings forth the true and correct position of the organization. The recording of transactions relating to raw material starts with the security check and entry in the Register Inward kept for the purpose at the entry gate of ZIM Laboratories. Materials in this case usually consists of : i. ii. iii. Inputs (Raw Materials or Packing Materials) Capital Goods (generally Machinery) Spares & Consumables (Factory Expenses)
Thereafter, they are transferred to respective departments after making an entry in the Outgoing Register. Input goods are transferred to Raw Materials/Packing Materials Department, Capital Goods are transferred to Production Department, and Spares & consumables are transferred to Stores Department. A Goods Receipt Note(G.R.N) is issued by the respective departments on receipt of raw materials/capital goods.
5.4.1 Posting of Transactions After issue of GRN, there is made an entry of receipts in registers kept for the purpose : i. ii. iii. Receipt Register (Raw/Packing Materials) Inward/Fixed Assets Register (Production Department) Receipt Register (Stores Department)
5.4.2 Dispensing / Basis of Issue of Raw Materials On the receipt of requisition from respective user department, a slip is issued in favor of the respective department and finally an entry in made in outward register. Accordingly, i. ii. iii. Issue Slip (by Raw/Packing Department) and entry made in Outward /Issue Register. Delivery Memo to Stores (by Production Department). It also acts as register entry. Issue Slip ( by Stores Department) and entry made in Issue Register.
5.4.3 Posting of Issues After issue of raw materials or spares and entry in department outgoing register, the issue is posted in Ledger(financial effect) and Invoice/Sale-Book(Inventory effect). 5.4.4 Financial and Inventory effects of transactions Only payment related details are entered in the financial books viz. date, cheque no., amount, etc. and in case of inventory books the unit price per material is entered along with issue slip issued by the raw materials or stores department. In case of deviation from the required quantity, a Debit Note is issued by the department in favor of the party for verification and variation. After the entire cross verification, entry is made in the financial accounts.
5.4.5 Payment method
Generally, payment for raw material purchases is done on cash or cheque basis. In case of cash payment, payment entry is posted in Party account by cash register. Similarly, on payment through cheque, entry is posted in respective Party account by Bank Register. 5.4.6 Recording of Raw Material/Packing Material Purchases At Security check point, entry is made in Entry Register and GRN issued. Material passes to Quality Control department for sample checking. If the material is approved by the QC department, an entry to that effect is made in the Materials Receipt Register and posted in Party’s Ledger account. Requisition slips are filled by the departments in need of the raw material and issued in favor of materials and stores department. In return, the materials and stores department issues ‘Issue Slips’ and enters the transaction into Issue Register. Finally, the entry is posted in Ledger and Stock Register is updated.
5.4.7 Books of Accounts maintained 1. Cash Book 2. Bank Book 3. Journal 4. Purchase Registers i. ii. iii. i. ii. iii. Raw Materials PR Packing Materials PR Finished Goods PR Commercial SR Excisable SR Other SR
5. Sale Registers
6. Credit Note Register 7. Debit Note Register Credit note and Debit note Registers are maintained by the organization for entering Rate Difference and Short quantity. Page No.52
53 .2 Activities of BDD 1.1 Functions of BDD a.8. Cash Budget 2. Page No.9 Voucher Entries ZIM follows the practice of entering transactions of normal or regular expenditure only through supporting vouchers. ZIM also concerns itself with the preparation of various budgets viz. Purchase Budget 4. 5.4.5. 1.8 Budgets In consonance with the general practices and like other organizations. The BDD is just like the Customer Care department which functions to face the competitors and focus to customer requirements.4. no entry is made in the books of accounts or no payment is made.5 BUSINESS DEVELOPMENT DEPARTMENT ZIM believes that the pharmaceutical business today is poised for a great leap forward. 5. In fact. To develop the organization business b. Overheads Budget / Cost Budget 5. Financial Budget 5. The department is a one window concept which means a one stop place for outsiders. for transacting with the organization. more specifically customers. Fulfilling customer requirements. Ledger Accounts 5. unless there is some voucher to support its nature of transaction. 5. Sales Budget 3.5. To represent and deal on behalf of customers with the organization.
Ensuring shipment of products in time. Monitoring performance of the agents appointed in foreign countries as also the performance of the customers with regard to the use of the products. right from conception to product delivery. 6. Follow-up of customer and agent payment.3 THE BDD CUSTOMER RELATIONSHIP MODELS BDD Relationship Domestic Customer Model Prodn .2. 5. Payment of Commission to agents appointed in foreign countries on time. The BDD acts as a connecting link between the organization departments on one hand and the agents and customers on the other hand. keeping in view a strict time Page No. HR QC Mkg A/c BDD Relationship Export Model Prodn .5. HR QC Mkg BDD Agents Customer 1 Customer 2 Customer 3 Customer 4 BDD Customer 1 Customer 2 Customer 3 Customer 4 A/c The independent and well-organized BDD is in a better position to offer efficient customer support.54 . 4. Timely intimation to customers about introduction of new drugs and processes. The position can be better explained with the help of following diagram :5. 3.
5. packaging development and design. The BDD provides services in the form of product development. some of which are : Easy access by all means of transportation to all parts of the country. Page No. A cosmopolitan. Regulation and Commercial Documentation Team. 5. and e. All the activities of BDD are geared towards providing a standing in-house representation the company to its valued customers. material sourcing assistance and developments of products (drugs) based on specifications provided by the clients. Central India is surrounded by vast tribal forest areas having their own wealth of plants of medicinal value giving it easy. such that both facilitate direct export/import. A dry dock facility and further development of the nearby Industrial area (Butibori).4 Composition of BDD The BDD is constituted of four interrelated cells with well-defined activities encompassing: b.6. Procurement Teams c.55 . Moreover.6 PRODUCTION DEPARTMENT\ 5. 5. Advantages of having the production plant in such area are numerous.1 The Production Plant The production facilities are located at Kalmeshwar Industrial Area near Nagpur in Central India. Plentiful electricity and water. Easy availability of technically qualified work force.schedule. Logistics Management Team. Packaging Development Team. secular atmosphere and work culture. local availability of the required plant raw materials. d. Easy and economical availability of raw and packing materials.
10. Receipt of order from the customer. the capsules are ready for packing and distribution. 8.2 Production Processes The normal production process followed by ZIM is given below : 1. Quality Assurance Analysis and release 12. Sampling and re-testing of products packed. Transfer of packaged products to Finished Goods store for dispatch. Testing of the manufactured product. Analysis & Release 4. Raw Material and Packing Material planning 3. 9. Testing of Inputs received. Capsule filling 7. Passing to Quarantine area 5. Actual manufacturing of products (drugs or processes) 7. Bringing in Raw Material(Active/Inactive) 2. In Process Quality Control Check and Release 9. Empty capsule loading 6. Polishing Section. Final Packing of the Capsules 11. Passing to Quarantine section 13. Capsule section is divided into following : 1. Checking . Packing of products.6. Blending & Weighing 3. Passing to Finished Goods and Packing Material Stores Finally. Steps involved in CAPSULE PROCESSING 1. Unit Packing and re-IPQC Check and Release 10.56 . Receipt of Inputs 5. 6. Material requirement planning 4. 2. Steps involved in the process of PELLETS and TABLETS Manufacturing Page No. Sifting. Mixing / Blending 2.5. Inspection and Polishing of the Capsule 8.
3. the tablets are covered in the Blister Cell. 7. However there are certain additional steps in the preparation and processing of tablets. ZIM possesses an exceptional technical team. There is re-IPQC checking. A good number of talented professionals are engaged in the unending endeavor to break new grounds and bring forth fresh solutions. 9. First. The R & D and Technical Services departments are key focus areas. Finally. It is then proceeded by an IPQC checking with regards to Moisture content. Then the tablets/pellets are dried using an Oven and passed through vibratory sifter. 5. Page No.1. Then there is weighing of the powder and tablets using the electronic balance. the tablets and pellets are packed after electronic balance checking. The above steps lays down the general process for the production of tablets and pellets. an independent Research & Development department and a full fledged quality Assurance department. Powder is prepared 2. The products are then coated and dried using a coating pan/fluid bed coater.1 Research and Development wing at ZIM The requirement of a sophisticated research and development wing is very essential from the point of view of pharma industries.7 R & D DEPARTMENT 5. 5.7. R & D requires not only a good technical team but also following of Quality check and Quality policy. 8. preparation of Binder and there is drug layering through coating the pan. 6. 4. The Double track machine. The defective tablets are purified using the Bulk Tablet Machine. Thereafter using PVC Sheets. 10. bulk density and total assay & drug release.57 . After weighing.
7. Site specific/Target release characterization.These talented team members ensure that the company’s customers. product development. Customers at ZIM obtain high-tech product advantage. corrosive and hazardous. or. 5. scientists and technical personnel who have great competence and experience to provide a range of services. This ensures the company an unbeatable edge in the competitive market place. and Ready for Compression Granules for unstable. ZIM has a team of researchers. Solubility and Stability enhancement. Formulation Development Whenever an order is placed by a customer regarding manufacturing of a new drug or process.3 Activities undertaken at R & D Department 1.7. technical assistance or regulatory affairs. pharmaceutical & analytical method development. derive the advantage of Innovative. 5. cost-effective and Quality products being produced after much research & development. new therapeutic classes besides renewing the interest for the older drug molecules by their continual improvisation through elimination of their negative attributes which otherwise would have rendered those molecules obsolescent. Taste-masking and flavouring technology for masking bitterness and obnoxious odour of active drug ingredients. Page No. including development and validation of formulations. and otherwise conventionally unworkable materials rendering them Environmental friendly or processable. The formula is developed after great research and experimentation required specifically in the field of medicines and drugs.58 . to a great extent and even perpetually. Products in several categories are available with diverse attributes that include conversion of Hygroscopic molecules to Non-Hygroscopic forms. Enteric Release specifically for Acid-labile drugs.2 The Technology path ZIM provides its customers a wide spectrum of value-added & cost-effective services whether pertaining to manufacturing. the company’s R & D department comes into play and develops the product through its sophisticated technical department and panel of technical team members.
The company generally carries out this activity with regard to the products already manufactured by it. that there will be a single software which will control all the functional departments. Page No. the information will be updated for reference and approval by other departments. and informed with respect to the functional softwares. Formulation Redesigning ZIM also undertakes the redesigning of formulations pertaining to products already in the market.59 . Where a purchase order has been placed by the purchase department.8 ERP & EDP The company has installed the Enterprise Resource Planning Software 2 months before.2. 5. Formulation redesigning is done only after receiving the requisition from the client regarding redesigning of product subject to change in the processes previously involved in the manufacture of the product.
CHAPTER 6 OBSERVATIONS LEARNINGS AND CONCLUSIONS It was an interesting and practical experience that was gained at ZIM Laboratories during the study .60 .The company Heads and Managers have been highly cooperative and had made good arrangements for the interactions despite their tight schedule.1 OBSERVATIONS Page No. 6.
besides.1. tablets and capsules have all been imported from China. For efficient functioning of its departments. but follows the simple and lucid system of crediting of excess worked hours towards emergency hours required by the workers. 9. pellets. 2. 6. ZIM has divided them into 15 different departments. 7. The machinery used in the production of powders. 4. which ensures evaluation of the true and correct productivity of the employees. Because of the quick functioning of the BDD. Requirement of better co-ordination between the departments for their effective functioning. The company has not involved itself in the providing of extra incentives to its workers and employees. proper co-ordination between the different departments functioning within the organization. which can be operated using the touch-screen system. Despite the general performance appraisal procedures. 3. The company in consonance with point 2 facilitates international quality standards with innovative services tailored to users need. 2. timely delivery of products to its customers. it ensures. 5. specially the department heads. The company’s market strategies which comprises of seven different models are unique and distinguishing. 8. The self-appraisal forms are then re-evaluated by a separate team of members appointed from each department.2 KEY LEARNINGS The study has facilitated me in learning the following things : 1. This ensures timely implementation of functions 6. which ensures quality products and processes. ZIM goes for selfappraisal. The company has ensured following of the quality policy through quality control and assurance department. concerned. Understanding the functioning of the various departments in the organization.61 . The company has excellent research and development wing. Page No.
The company believes in providing “Affordable Quality Healthcare through Zeal and Innovation in Medicine”. Learned how to carry on the SWOT. The Indian firms should put in good efforts to overcome the competition. The unique feature observed was that the Business Development Department was the intermediary between the customer and the organization. By having joint venture and collaboration with the foreign companies the industry can overcome the competition and at the same time it can upgrade its production technology. Page No. Understanding the organization structure and the decision making process. 6. Necessity of great division of labour and technical skills in such an industry is of vital importance.3 CONCLUSIONS An organization is a unified group of individuals who work laterally to achieve the desired goals and objectives. we get to know the working of organization and have an overview of its functional departments. But what comes of more importance is the functions of the organization. the departments comprised in the organization. The main focus on the study in ZIM was on coverage of all the departments in average. PEST and Porter’s Five Forces analysis. The company has good marketing strategy for export and domestic market. They maintain good relation within the employees as well as with the customers. Through this organizational study. ZIM is a pharmaceutical manufacturing company having diversified market strategies. 4. All the departments are linked with each other. or to be more specific. The better the co-ordination between the departments. and that no organization can succeed without taking into consideration this fact. more will be the growth of the organization. Placing Customer care and Customer Service at the apex of objectives list. There is healthy competition in the industry with entry of global giants.3. as also the reporting procedure between the departments. 6. The working of an organization is very well reflected by the working of its departments. Thus the overall study in ZIM Laboratories was a learning experience.62 . 5. and fame & reputation in the central industrial belt comprising Maharashtra and adjoining states.
63 .New / Novel Drug Delivery System. Objectives of drug Page No. finance which will be useful for my further studies. marketing. Drug discovery is the process by which potential drugs are discovered or designed. Drug development refers to activities undertaken after a compound is identified as a potential drug in order to establish its suitability as a medication. production.Thus the company has enabled me to learn the various aspects of management. ABBREVIATIONS AND MEANING OF TERMS NDDS .
a lack of which causes diabetes.64 . CHRONICLE Magazine– March 2009 2. BIBLIOGRAPHY Books and Magazines 1. as well as to establish safety.development are to determine appropriate Formulation and Dosing. Penicillin is an antibiotic produced naturally by certain blue moulds. Insulin is a polypeptide pancreatic hormone which lowers the glucose levels in the blood.January 2008 (Porters 5 forces) Page No. Generic Drug is a drug which is produced and distributed without patent protection. Harvard Business Review. and which is now prepared synthetically.
www.balancedscorecard. www.Websites 1.marksonspharma.org Page No.com 3.learnmarketing.net 5.themanager. www. www.org 6. www. www.org 10.hrmguide. www. www.com (balance scorecard) 8.rediff.org 9.com 4.marketingteacher.net (orgnaisation structure) 7.wikipedia. www.zimlab.65 .special. www.managementhelp.in 2.
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