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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.1.4 . and there was a questionnaire that was followed as questions which were asked depending upon situations. Internal Data. 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. Secondary Data 1. Personal Interview. Balance sheet. world.There was a keen sense of observation followed during the study period to follow the various functions of the company.There were interview sessions with each of the functional heads. 2. 2. like External Data.It includes organization data derived from internet.This includes data provided at the company’s office. Observation.6 METHODOLOGY used for Organization study Primary Data 1. and other Organization structures.
5 .CHAPTER 2 INTRODUCTION TO THE PHARMACEUTICAL INDUSTRY Page No.
with the UK. Legislation was enacted to test and approve drugs and to require appropriate labeling. understanding of human biology (including DNA) and sophisticated manufacturing techniques. 2. Pharmaceutical manufacturing became concentrated.2. The first known drugstore was opened by Arabian pharmacists in Baghdad in 754. Switzerland. Belgium and the Netherlands following suit. Pharmaceutical companies can deal in generic and/or brand medications. due to the development of systematic scientific approaches. testing and marketing of drugs. Prescription and non-prescription drugs became legally distinguished from one another as the pharmaceutical industry matured. and many more soon began operating throughout the medieval Islamic world and eventually medieval Europe. became mass-manufactured and distributed. Key discoveries of the 1920s and 1930s. They are subject to a variety of laws and regulations regarding the patenting. Cancer drugs were a feature of the 1970s.1 INTRODUCTION The pharmaceutical industry develops.6 . and markets drugs licensed for use as medications. The industry got underway in earnest from the 1950s. many of the drug stores in Europe and North America had eventually developed into larger pharmaceutical companies.2 GLOBAL SCENARIO Page No. By the mid-1980s. Germany and Italy had particularly strong industries. Most of today's major pharmaceutical companies were founded in the late 19th and early 20th centuries. The earliest drugstores date back to the Middle Ages. such as insulin and penicillin. Numerous new drugs were developed during the 1950s and mass-produced and marketed through the 1960s. produces. From 1978. small biotechnology firms were struggling for survival. By the 19th century. with a few large companies holding a dominant position throughout the world and with a few companies producing medicines within each country. India took over as the primary center of pharmaceutical production without patent protection. which led to the formation of mutually beneficial partnerships with large pharmaceutical companies and a host of corporate buyouts of the smaller firms. US.
expansion of medical infrastructure. rising prevalence of chronic diseases. Top 14 Pharmaceuticals 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. 2005 Top 14 Pharmaceuticals Markets. greater penetration of health insurance.7 . The semi and non regulated markets of Asia.Global Pharmaceuticals Market 1. Size of the global pharmaceutical market was US$ 602 bn. a. The pharmaceutical markets worldwide can be classified as Regulated. Semi Regulated and Non Regulated markets. 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. The market has grown at a CAGR of nearly 11% during 1998-2005. The regulated markets constitute 88% of the global pharmaceutical market. According to McKinsey & Company report (“India Pharma 2015). adoption of product patents. 2. b. Africa. 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. and aggressive market penetration driven by the relatively smaller companies. 2015 Page No.
is also the single largest export market for Indian generics. growing healthcare expenditure and low generic penetration across large geographical areas.8 .US $ billion US $ billion 2. • USA .2. the largest generics market globally. The Japanese market is poised to become an important destination for many global generic players with the introduction of generic substitution in 2006.1 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. Page No. • 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.
• 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 . • India is also an apt destination for outsourcing of research services due to its large population with relative underexposure to drugs. It provides employment to millions and ensures that essential drugs at affordable prices are available to the vast population of India. especially China and Israel . Page No. Indian Pharma Industry is playing a key role in promoting and sustaining development in the vital field of medicines. Indian Pharmaceutical Industry has attained wide ranging capabilities in the complex field of drug manufacture and technology. capsules. chemicals. significant cost advantage and the availability of well qualified investigators. pharmaceutical formulations.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. tablets. • 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. which would have been difficult to obtain otherwise. drug intermediates.• Low production costs give India an edge over other generics-producing nations. 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. From simple pain killers to sophisticated antibiotics and complex cardiac compounds.9 . 2. Around 70% of the country's demand for bulk drugs. almost every type of drug is now made indigenously.
e. which is next only to that in the US. notable among these being Ranbaxy. Wockhardt.72000 crore during 2006-07.orals and vaccines is met by Indian pharmaceutical industry. The industry has thrived so far on reverse engineering skills exploiting the lack of process patent in the country. which is another trend seeing a reversal. Novel Drug Delivery Systems. 1 January 2005. New Chemical Entities. bulk drugs. Cipla. Dr.10 . holding fourth position in terms of volume and thirteenth position in terms of value of production. 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. pursuant to the obligations under the WTO Agreement. having risen more than 12times since 1990. Page No. The companies have their strategies in place to leverage opportunities and appropriate values existing in formulations. Indian pharmaceutical industry is undergoing fast paced changes. The quality of the products is reflected in the fact that India has the highest number of manufacturing plants approved by US FDA. A number of Indian pharmaceutical companies adhere to highest quality standards and are approved by regulatory authorities in USA and UK. This has resulted in the Indian pharmaceutical players offering their products at some of the lowest prices in the world. Reddy’s Labs. 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. generics.f. The Indian pharmaceutical companies have been doing extremely well in developed markets such as US and Europe. Biotechnology etc. India has become one of the leading global players. has not dampened the robust growth but has improved the overall IPR environment. Nicholas Piramal and Lupin. The Indian Generics market is witnessing rapid growth opening up immense opportunities for firms.24942 crore in 2006-07 accounting for as much as 34% of the turnover. The turnover of the industry was Rs. The adoption of world-class patent laws for pharmaceutical products w. Multinational companies have traditionally dominated the industry. Exports have also grown significantly to over Rs.
Analogue or Discovery Research 4. Kinds of Research : 1.3. (ii) Cost-effective chemical synthesis: Its track record of development. There is already an established international industry and business community. Page No. They chose specific therapeutic areas to target based on their strengths in the market. particularly in the area of improved cost-beneficial chemical synthesis for various drug molecules is excellent. it has more than 70 million middle class market. Companies that involve in R&D do so in specific areas. it is the Indian companies which are dominating the marketplace with the local players dominating a number of key therapeutic segments.000 entities and the organized sector consisting of about 300 entities. Above all. (iv) (v) Information & Technology: It has a good network of world-class educational institutions and established strengths in Information Technology.11 . R&D is the starting of the industry value chain and is also the most important value creator.Currently. 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. NDDS(New Drug Delivery System) Research 2. Consolidation is increasing in the industry with many local players building a global outlook and also growing inorganically through mergers and acquisitions. It provides a wide variety of bulk drugs and exports sophisticated bulk drugs. Basic R & D 2. Professional services are easily available. and the commercial potential. The Key to success in this industry is research & development. Biotechnology Research 5. Globalization: The country is committed to a free market economy and globalization. The market is also very fragmented with about 30. Process Research & Reverse Engineering 3. (iii) Legal & Financial Framework: India has a 58 year old democracy and hence has a solid legal framework and strong financial markets.
251.838 bn) 10.13 bn) 9.which is continuously growing.801 bn) 7.22. Cipla (2007 Turnover – Rs. has started taking place in India.37. 2.635 bn) 5. Sun Pharma Industries (2007 Turnover – Rs.17.9.804 bn) 2. (vi) Consolidation: For the first time in many years. Lupin Labs (2007 Turnover – Rs.24. Glaxo SmithKline Pharma(2007 Turnover – Rs.41.12 . the international pharmaceutical industry is finding great opportunities in India.Reddy’s Laboratories (2007 Turnover – Rs.9. Aventis Pharma (2007 Turnover – Rs. Dr.4 TOP 10 MARKET PLAYERS IN PHARMA INDUSTRY 1.4. Cadilla Healthcare (2007 Turnover – Rs.155 bn) 6. Aurobindo Pharma (2007 Turnover – Rs.734 bn) 8. Ipca Laboratories (2007 Turnover – Rs.1 THE STRATEGIES ADOPTED BY MARKET PLAYERS Business Strategies followed by Indian Pharmaceutical Companies Page No.16.637 bn) 4. which has become a generalized phenomenon in the world pharmaceutical industry.622 bn) 3.96 bn) 2. The process of consolidation. Ranbaxy Laboratories(2007 Turnover – Rs.20.
i. chemicals having therapeutic value and used for production of pharmaceutical formulations. More than 85% of the formulations produced in the country are sold in the domestic market. Over 60% of India's bulk drug production is exported and the balance is sold locally to other formulators.e. There are also 5 Central Public Sector Units that manufacture drugs.13 .4.2 DISCOVERY R & D IN INDIA The Indian industry has attained cost advantages in process research used for generic drugs & value added generics production.Most infrastructure facilities are much cheaper in India than in developed countries. new generation under-patent formulations are imported. India is largely selfsufficient in case of formulations. Page No. 2. which they market in India. This cost advantage is in the fact that: .000 registered units and is very top heavy. Some life saving. These units produce complete range of pharmaceuticals. which include medicines ready for consumption by patients and about 350 bulk drugs.Indian Pharmaceutical sector is highly fragmented with more than 20. which accounts for 60-80 percent of total sales.. by MNCs. The leading 250 pharmaceutical companies control 70% of the market with market leader holding nearly 7% of the market share.
total expenditure on R&D was low (multinational pharmaceutical players spend about 1316% of total sales on R&D).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 advantages of conducting R & D in India are given below: . In the absence of product patents.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. with industry chipping in with 10% to 12%. Consequently.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. Reddys who are willing to take the risk of investing millions in building research capabilities and developing molecules. Indian companies ignored basic research and concentrated their R&D efforts toward producing drugs through alternative processes. which is a very small number. as the industry structure did not provide Indian firms incentives have invested to very invest little in in R&D in basic India research. The cost differentials are due to lower costs in machinery and human capital. due to: . Indian industry instead mastered the art of reverse engineering to gain competitive advantage.. Biocon & Dr. Investments made in R&D by the Indian pharmaceutical companies would yield 3-4 molecules a year. 2. Indian companies have started investing in complex R & D activities like novel drug delivery system and new drug discovery. The cost Page No. 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. . The government continues to bear the burden. There is very little private initiative to invest in R&D.Indian scientists can be attracted at much cheaper rates than their US counterparts.Lower costs: R&D expenditure in India is far lower than in the developed countries. The profitability of Indian companies is also much lower than international levels.4.14 . This also evident in the data of patent granted in the country where the top firms granted patents are mostly MNCs.
so that it can take advantage of change within the environments in which it operates. Page No. PEST is an acronym and each letter represents a type of factor (Political. A successful organisation will not only understand existing factors but also forecast change.5 PEST ANALYSIS An organisation’s success is influenced by factors operating in it’s internal and external environment. • Micro environmental factors – These are internal factors.Population advantages: A larger population base would facilitate clinical trials for diseases especially prevalent in developing countries. Indian R&D efforts could be directed towards infectious diseases that are especially prevalent in Asian countries. investments are expected to start flowing into the area of basic research. Economical Social and Technological). an organisation can increase it’s success by adopting strategies which manipulate these factors to it’s advantage. . anti-parasitics and other anti-bacterials. Such R&D activities will be targeted towards segments such as antibiotics. Following India’s acceptance of the provision of Trade Related Intellectual Property Rights (TRIPS) under the GATT agreement. which the organisation can control.15 . 2. • Pest Factors – These are external forces which the organisation does not have direct control over these factors.advantages can only be exploited if the necessary funds required can be sourced.
Ineffective voluntary codes and practices will often lead to governments introducing legislation to regulate the activities covered by the codes and practices. Factories Act 1948 and allied labour and industrial laws also affect the working in the industry. Pharmaceutical Industry in India has been de-licensed and industrial licensing for most of the drugs and pharmaceutical products has been done away with.Diagram: PEST analysis and the marketing mix. Besides the industry is also subjected to provisions under the TRIPS. 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. Page No.16 . Manufacturers are now free to produce any drug duly approved by the Drug Control Authority. POLITICAL FACTORS ANALYSIS It is the first element of the study of PEST Analysis. Non conformance with these legislative obligations can lead to sanctions such as fines. adverse publicity and imprisonment in certain cases. since the players have to function within the desired provisions.
All businesses are affected by national and global economic factors.The pharmaceutical industry has thrived so far on reverse engineering skills exploiting the lack of process patent in the country. 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. National and global interest rate and fiscal policy will be set around economic conditions. a shift in excise duty levy to MRP based levy and the enactment of product patent regime. ECONOMIC FACTORS ANALYSIS The second element of a PEST analysis involves a study of economic factors. The rural markets grew by over 40 percent during the calendar year 2006. suppliers and other organisational stakeholders such as suppliers and creditors behave within society. Ranbaxy acquired Romania's Terapia. For example. The climate of the economy dictates how consumers.17 . Ethimed NV of Belgium and GSK's generic business Allen Page No. which includes implementation of VAT. several Indian pharmaceutical companies have acquired companies in the US and Europe and many others are raising funds to do so. 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. Besides there have been a number of regulatory developments since 2005. 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.
According to industry statistics at global level. TECHNOLOGICAL FACTORS ANALYSIS The last element in the PEST study is the analysis of technological factors. Dr Reddy's acquired German generic drug maker Betapharm. to a great extent. If organisations do not respond to changes in society they will lose market share and demand for their product or service. friends. Gone were the days when medicines and herbs used to be purchased based on monetary factor. The standard of living of people has increased to a great extent.SpA in Italy. doctors and physicians play an important role in furthering the advantages of medicines. Aurobindo and Jubilant Organosys are on the lookout for lucrative acquisitions.Revital. A number of pharmaceutical companies have therefore come out with such drugs and syrups. that will help people to maintain health and be happy. Companies like Glenmark Pharma. and they desire to spend more for maintaining their health and status.18 . also provides ample market place for the pharmaceutical companies to diversify their selling area. only about one in ten thousand chemical compounds discovered by pharmaceutical industry researchers proves to be both medically effective Page No. software and hardware equipments used in information exchange system and in managing the business. A distinguishing feature of the pharmaceutical industries in India is the large scale investment by big pharma companies in the research and development. which includes the machinery. Here to. SOCIAL FACTORS ANALYSIS The third aspect of PEST focuses its attention on forces within society such as family. Indian people. Organisations must be able to offer products and services that aim to complement and benefit people’s lifestyle and behaviour. Besides the growing population of India. neighbours and the media. are becoming health conscious. ex. colleagues. Lupin. 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.
This technological revolution has increased the rate at which information is exchanged between stakeholders. Leading Indian companies have started to look beyond generics and are investing in discovery R&D (NCE/ NDDS research) for sustainable long term growth. has a very strong biogenerics programme One NCE in Phase II trials in USA . and about half of all new medicines fail in the late stages of clinical trials. A faster exchange of information can benefit businesses as they are able to react quickly to changes within their operating environment. Also focused on 3 other NCE projects and 4 very promising NDDS platforms Has out-licensed a novel statin to PPD . Also partnering with innovative companies on specialty drugs.19 . Technology has created a society which expects instant results.and safe enough to become an approved medicine.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. 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. 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. The discovery R&D pipeline of Indian pharma players has been seeing a steady build up over the years. However an ability to react quickly also creates extra pressure as businesses are expected to deliver on their promises within ever decreasing timescales. which is described below: Page No.
In Pharmaceutical industry it is easy to enter but talking about Products it is tough because it depend on the reliability of customer.20 . For new entrants. which may cause in reducing its attractiveness. it’s a very big challenge to establish business because heavy amount of capital and investment is required. Page No.Figure: Porter’s Five Forces Model for Industry Analysis Porter explains that there are five forces that determine industry attractiveness and longrun industry profitability. 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. 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. The threat of new entrants largely depends on the barriers to entry.
Supplier is said to have high bargaining power where the product sold by him has no substitute or even very close substitute. but will affect the market share of other pharmaceutical organizations also. The bargaining power of suppliers will be high when: ➢ In an industry there are many buyers and few suppliers. raw materials. substitutes price. The cost of items bought from suppliers (e. which are generally taken up by already substantiable organizations. This factor may apply to new entrants in industry.21 . Page No. The relative price and performance of substitutes affects the usage of the organizations drugs. it’s difficult thereafter to divert customer mind to other substitutes. The New entrants find it difficult to cope up with this problem. The threat of substitute products depends on: ● In pharmaceutical industry.g. But in pharmaceutical industry there are many buyers and many suppliers so bargaining power over a company is not much. which go a long way in manufacturing the product. components) can have a significant impact on a company's profitability.• Distribution of drugs and vaccines plays a major role with out which it is not possible for manufacturer to reach prospective customers. Recent acquisition of Ranbaxy by Daiichi Sankyo will not only help Daiichi to strengthen its roots in the Indian Pharmaceutical industry.e. once competitor gets customer reliability(loyalty). ● In pharmaceutical industry. price plays a major role and it’s totally dependant on market price of the goods i. We can also infer here the entry of consolidated/amalgamated corporates or newly acquired organization. If suppliers have high bargaining power over a company. then in theory the company's industry is less attractive. Bargaining Power of Suppliers Suppliers are those business houses that supply raw materials & other products to the industry. Threat of Substitutes The presence of substitute products in pharmaceutical industry can lower industry attractiveness and profitability because they limit price levels. These type of co-existence also affects to a great extent the functioning of small and medium scale organizations.
The degree to which rivalry drives down an industry’s profit potential depends. In case of Industrial buyers. Page No. But in case of pharmaceutical industry. who can force the organization to produce only such class of drugs or vaccines which is more popular among their potential customers. and service improvements. new product introductions. they can be said to have a moderate bargaining power. advertising campaigns. then he can be said to have low or no bargaining power in case of necessary drugs or vaccines. secondly. Pharmaceutical industry is the key customer to the supplier because for suppliers other buyers are few. High rivalry limits the profitability of an industry. cancer drugs. Bargaining power of Buyers Powerful customers – the flip side of powerful suppliers – can capture more value by forcing down prices. • Despite the exit barriers. on the basis on which they compete. since it is a business to business market and the buyer here are the wholesalers. the intensity of rivalry is very high because there are more than 20000 registered units. on the intensity with which companies compete and. including price discounting. and other drug buyers than those drug companies offering generic (non-patented) products. all at the expense of industry profitability. if we talk of retail buyer. demanding better quality or more service (thereby driving up costs). • In pharmaceutical industry.22 . first. But this situation varies in case of drugs of extreme necessity viz. health maintenance organizations. Rivalry among existing competitors Rivalry among existing competitors takes many familiar forms. more or less on an equal size and out of which about 250 are big pharma companies controlling 70% of the market share. Pharmaceutical companies that offer patented drugs with distinctive medical benefits have more power over hospitals. and progress through R & D. small pharma companies find it profitable to remain on track.➢ The industry is not a key customer group to the suppliers. where there can be no expectation of bargaining by the buyers against the manufacturing industries. and generally playing industry participants off against one another.
has a favourable market position with strong financial make-up and strong earnings growth. 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. Page No. Overall.2 percent based on the potential of their product pipeline.23 . The industry remains highly valued. because they are also the provider of great employment opportunities in urban as well as rural sectors. The forecast of the leading 16 pharmaceutical companies for 2001 to 2007 suggests that combined sales will grow at a minimum rate of 5. the pharmaceutical industry shows an upward trend in its core markets.• • Big pharma companies in India are competing on the basis of R & D facility and through scheme of new drugs and vaccines.
Zim Laboratories Limited exemplifies an organization displaying these very traits.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. The organization has been established under the shelter and support of Universal Group of Pharmaceutical Companies.24 .CHAPTER 3 COMPANY PROFILE 3. one of the leading pharmaceutical group in central India. This demands for expertise & skill to stay ahead.
Anwar S. Registration The as vendor by Ministry of Defence (Director General Quality Assurance). E-mail – bdd01@zillab. Headquartered & set-up in the industrial belt of Nagpur City of Central India.C.Vali. organization’s systems and documents are in conformance with the ISO 9001:2000 Standards accredited by AQA of USA. constantly penetrating newer areas of pharmaceutical business & technology. by Award of Udyog Patra. Zakir S. ZIM & Associates are supported by excellent technical team & sufficient capacity to produce large requirements for different market segments.1. certified by Food and Drugs Administration.ZIM has made a significant mark as a maverick pharma innovator.in Felicitation of Mr.in email@example.com Website – www. and successfully demonstrating its commitment to its Missions & Goals. Page No.zimlab. Kalmeshwar – 441501. Chairman. MIDC Area. for being an Eminent Industrialist. Planning Commission of India. India. ZIM has established itself as one of the preferred healthcare solution providers in the field of New Drug Delivery Systems (NDDS).Daud. Nagpur – 440002. Award of the Best Managed Industry by D.of Maharashtra. India).of India. Shantinagar. E-mail : zimltd@dataone. but the Deputy Chairman.(Govt. Govt. Felicitation for contributing to Industrialization and other important. ADDRESS Of Corporate Office and Works Place Corporate Office 545. Managing Director by Central Institute of Business Management Research & Development.I.1 Accomplishments Works B-21/22.in 3.25 . areas to Mr. India. The facilities provided by the organization are WHO CMP.
its products and services through following six core principles : • UNDERSTANDING markets & Customers Page No. External Preparations. Multiplets. customers.2 The Core Principles of ZIM The organization articulates its understanding of market. SVPs (Injectables). material sourcing assistance and developments of products based on client's specifications. well . as well as in the international markets. Dry Syrups. ZIM has pioneered several innovative technologies & products particularly in the spheres of Pellets. have ensured a strong presence in the domestic markets. The Independent and Development Department at position to offer customer product delivery in a strict services ranging from product development and design. Multiparticulates & Modified Release Oral Solid Dosage Forms have been identified as a thrust area & key formulations developed. Herbals & Diagnostics. distribution & marketing of pharmaceuticals in Allopathic & Herbal categories encompassing almost every dosage form. including Tablets.organized Business this organization is in a support from conception to schedule and provides packaging development.26 . Liquid Orals.1. Resinates. The wide appreciation for its quality and prompt services to clients. Ointments. 3.ZIM & its Associate Companies are engaged in the activities of manufacturing. etc. Capsules. Powders.
..27 . . thereby contribution to make available of High Quality Affordable Healthcare for the common man and meeting our Obligations to our Employees. tryly innovative technologies with the potential to change the nature of human health & Page No. • DELIVER Products & Services. • Niche Products and Markets. • Original Research based Herbals for Chronic aliments.2 MISSION AND VISION 3..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. • PROVIDE Customer Service.2 VISION STATEMENT "Making Quality Healthcare Affordable" “We believe that the pharmaceutical business is today poised for a great leap forward. • Biotechnology based Products & Processes.” 3.2.... 3... Investors and the Shareholders... • MARKET & SELL Products & Services • PRODUCE Products & Services.2..• DESIGN Products & Services.
aspire to play a significant role in making the fruits of such technologies available as affordable healthcare solutions.2. give value for money.longevity have already appeared and each day brings better & better innovations.28 . teaming with like-minded associates in the pharmaceutical technology business. & to offer our customers innovative & exclusive quality products that differentiate them from their competitors & significantly impacts their bottom-line. Uniquely positioned to provide expertised drug delivery systems. Ever changing regulatory guidelines. while respecting the rights of others.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. advances in drug therapy & delivery systems. globalization & evolving market such as those for nutritional supplements.” 3. every day we continue to put our Zeal for Excellence and Spirit of Innovation into all our actions. we support our own & customer's objectives with specialized formulations to reach the market faster & easier than ever. We are committed towards providing our national & international clients an easy & timely access to sophisticated process technologies & products. old-age & alternative therapy medicines pose challenge to every pharmaceutical organisation to manage and accelerate the drug development process. Page No. drug industry Mergers Acquisitions. 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. That's why. aiming for Customer Satisfaction. We at ZIM. Striving for Customer’s Satisfaction through all their actions.
Transacting business with Integrity & Transparency. 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. customizing testing to meet client specifications through time-valued and cost effective tests at their facility.29 .3 SWOT ANALYSIS Strengths 1. promotion of Education.e. This is because of the sophisticated machinery and the great endeavor taken by the Business Development Department towards fulfilling the orders of the clients. 3. 2. Aspiring for a Responsible Corporate Citizenship through Humanity in constant harmony and Peace. ZIM has assembled a team of researchers. 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. (iii) Performing and monitoring stability testings based on ICH guidelines. For this purpose and to serve an industry that is rapidly changing. The management very well believes in producing new drugs and vaccines that will help in the control of diseases. Quality drugs and processes Page No. Respecting the Rights of all Stake-holders & Associates. and contribution towards Disease-free ZIM is very much involved in the production of novel allopathic drugs. Making Innovative Products our regard for Environment. 3. Less through-put time ZIM has mastered the strategy of involving less time in meeting up with the order of the clients.
This is done in a strict time schedule. Many a times. 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. Weaknesses Capacity constraint The organization faces the problem of meeting to the excess order requirements of the clients. the company is exporting Page No. 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. The BDD acts as the connecting link between the prospective clients of the organization and the company. The independent and well-organized BDD is in a better position to offer customer support from development to delivery of product. Presently. A unique feature of this department is that it provides services ranging from product development. ZIM believes that Quality is a continuous process an not an isolated stage.30 . packaging development and design. and provides a standing in-house representation of the inside company. the order quantity poses a risk to production pattern and hence results in capacity constraint. Moreover. material sourcing assistance and developments of products based on the specifications or requirements of the clients. ZIM has a highly developed and sophisticated customer care department. 4. 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. facilitating the International Quality Standards with innovative services tailored to users need. special care is taken at every stage of the manufacturing process. which is nominated as Business Development Department. and that too because of the quality drugs manufactured by it.There is production of drugs and vaccines that meet more than upto the expectations of the clients.
4 PRODUCTS AND MARKETS PRODUCTS The following specific formulations are offered:• Taste and Odour Masked Formulations. • Stability Enhancement----.component Formulations. 3. Chattisgarh and Madhya Pradesh. Iraq and Yemen. • Dispersible / Mouth Dissolving Tablets and their R C Granules. • Bio-availability Enhancement---. some of which are Bangladesh. Nigeria. Vietnam. Glaxo SmithKline.Formulations & Powders . • Dual Release Formulations (Delayed Release With Enteric Coating Attributes). • Non-Pareil Seeds & other pre. Latin America. UAE. The company sees a bright market prospect in the continents of Africa and America. some of which are Maharashtra. The organization is comprehended to the threat of operations of major domestic players like Ranbaxy Laboratories. 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. • Sustained Release Formulations. Morocco. Sri Lanka. Egypt.. Libya. and others. • Enteric Release Formulations. Besides it has also covered several Central and South states in the domestic sector. • Immediate Release Stabilised Multi. • Herbal single & multi-components pre-mixes.its products to more than 25 countries. and multiparticulates. Algeria. Page No.31 . The reason why it places high dependence on export sales is because of its superior quality drugs and processes.Premixes & Granulates. which makes it one of the better manufacturers among its sector.processed excipients. granules.
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.32 . the company has the experience & ability to manufacture and supply large volumes of standard and customized finished formulations under different labels & brand names. 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.
marketing and developmental inputs to these. but also managing the same. the framework is gaining increasing importance among different business houses.3. The impact of the right strategies will automatically be reflected in the results. 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. This tool brings a link between strategy and action. Moreover. By focusing not only on financial outcomes but also on the operational. which in turn helps organizations act in their best long-term interests. In this era of cut-throat competition. 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. development of state-ofthe-art technologies and creation of an environment of learning and growth. any organisation has to understand that it needs to give impetus not only towards the financial results but also towards satisfaction of the customers.33 . Page No. the Balanced Scorecard helps provide a more comprehensive view of a business. what an organisation requires is not just framing the right strategies.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. Due to these.
34 .Balance Scorecard Phases Page No.
The scorecard provides a feedback to the senior management if the strategy is working. It aligns everyone within an organization so that all employees understand how they support the strategy. The framework tries to bring a balance and linkage between the – (a) Financial and the Non-Financial indicators. It communicates the objectives and measures to a business unit. 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. 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. This innovative tool is unique in two ways compared to the traditional performance measurement tools. One of the tools for organizational appraisal that is gaining immense popularity is the Balanced Scorecard. It translates vision and strategy into action. developed by Robert S Kaplan and David P Norton in 1992. Advantages of using Balanced Scorecard approach : 1. It aligns the strategic initiatives in order to attain the long-term goals. 3. 4. Example of Balanced Scorecard A typical scorecard of an organization can be prepared as under: Page No. 2.35 .The long-term success of any organization is determined by the capabilities and the competencies it has developed. It defines the strategic linkages to integrate performance across organizations. 7. 6. They are– (i) It considers the financial indices as well the non-financial ones in determining the corporate performance level. (c) Internal and the External aspects and (d) Leading and the Lagging indicators. 5. (b) Tangible and the Intangible measures.
36 . Besides. which looks out for overall satisfaction of its customers. 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. This has been carried out to a large extent by the highly efficient Business Development Department of the company. The Customer Perspective: The company satisfies its customers in an effective way and caters to the customer requirements very efficiently. there arises no questions of return to the shareholders.Observational Analysis of ZIM Laboratories The Financial Perspective: The company follows effective financial strategies to maintain stability in finance and allocation of funds. The Process Perspective: Page No. Since the company is an unlisted one.
The Innovation and Learning Perspective: In this area. by using the people resources most effectively. Page No. in order to avoid wastage and spoilage. and cost reduction. logistics or sales and then set goals related to such things as quality. and skills improvement. The above analysis has been carried on the basis of observations brought out during the organizational study.In process perspective also the company have a very specific goals regarding like production. retention.37 . time/efficiency. Company generally follows production on the basis of orders generated from the customers. It also look at measures for research and development. Note: Company doesn’t follow balanced score-card approach. the company is examining measures relating to employee development. It focus here is on continuous improvement and value creation.
38 .CHAPTER 4 ORGANISATION STRUCTURE AND CRITICAL REVIEW Page No.
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. Maintenance. Mechanistic and Organic structures 4. operations. Human Resources. The Matrix 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. or region. the organization is departmentalized on the basis of various functions performed by it viz. 4. Vertical and Horizontal structures 3. etc.4. influencing the attitudes and social relations that emerge over time and the ways in which work related tasks are completed. R & D. customer. Page No. Functional and Divisional structures 2.2 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. In case of divisional structure.1. In functional structure. 5. organization is departmentalized on the basis of products.1.1 Why Organizational Design ? Organizations have become the primary form of social institution in contemporary society. The way in which an organization is structured creates/restrains opportunities for interactions with other organizational members. Organization structures may take different forms. Following are the broad types of structural forms : 1.39 .1.
40 . 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. attempts were made to combine the advantage of product and functional departmentalization to achieve the organizational goals. The essence of modified structure lies in the modifications to the classical principles of delegation of authority and standard of control. the organizational structure suitable to stable conditions was termed as mechanistic structure. the writers and organizations began to explore ways to modify the two structures. 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. both absolute centralization and decentralization are neither desirable nor possible. 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. structures incorporating wide spans and limited layers of control at horizontal levels were called horizontal structures. both these structure have their own advantages and disadvantages. Individuals were made responsible both to their line manager and the project manager involved. Accordingly. Page No. bringing skilled individuals together from different parts of the organization. and employees report to both of them. Matrix forms of management can be regarded as an early form of 'network' structure. Hence. However. Accordingly. Matrix Structure The matrix organization structure was proposed by Dairs and Lawrence for Aero space programme of the United States. In other words. In this structure. organizations having a series of narrow span of control were termed as vertical structures. each department reports simultaneously to both product managers and functional managers. On the contrary. In a matrix organization. They focus on project teams.Vertical and Horizontal structures In an organization.
Federations This form is a variant of the divisional organizational structure which has great importance because of its human resource factor. But this form of organization has attracted criticism from stock market analysts who find difficulty in comprehending its subtle informality. 4. since the power of management control is divided between the Financial Director and Executive Director from the Managing Director.2 ORGANISATION STRUCTURE OF ZIM LABORATIES Zim Laboratories follows Horizontal form of organizational structure.41 . The federations is a loosely connected arrangement of businesses with a single holding company or separate firms in alliance. CHAIRMAN Page No.
PRODUCTION OFFICER ALL ASST. ASST.P. The Chairman is concerned with policy making matters.42 . EXEC ALL ASST. ALL ASST. VPBDD INTERNAL AUDIT INCHARGE MANAGER R&D V. ALL ASST. ALL ASST. ACCOUNTANT ADMIN. ALL ASST. PURCHASE ALL ASST. PRODUCTION MANAGER STORE INCHARGE(FG) STORE INCHARGE(RM) STORE INCHARGE(PM) PERSONNEL OFFICER ALL ASST. ALL ASST. R&DS R.3 CRITICAL REVIEW of the Organizational Structure 1. INWARD / OUTWARD INCHARGE ALL ASST.MANAGING DIRECTOR FINANCIAL DIRECTOR EXECUTIVE DIRECTOR PURCHASE OFFICER A/C OFFICER EDP ERP ADMIN. OFFICER HR MANAGER SECURITY ASST. OPERATION PROJECT INCHARGE OSD QC QA MANAGER MAINTENANCE ENGG. Page No. ALL ASST. ALL ASST. 4.
stores and personnel departments are under the control and supervision of Operations department. but also the purchase department. 8. Therefore he is burdened with the task of responding to each of them. to some extent. The Finance Director controls not only the accounts department. 5. which requires technical as well as functional expertise on his part. The Managing Director is entrusted with the functions of routine management. Like a just organization. Quality Control and Quality Assurance c. a demeaning effect on the working of the MD. Internal Audit d. 9. 3.2. which can have. 4. 6. During the Board Meetings there has to be reporting of policies framed and exceptional functions performed during the routine management. wherein it is desirable to have a horizontal organization design. Business Development Department b. Operations f. this form of organization design poses a great challenge for him.43 . Research and Development e. The organization operates in a B2B market. Page No. The only misconception about this form of design is that the MD has to operate and hear from all the departments functioning within it. Projects 7. Since MD is to concern himself with the making of policies in an organization. the production. The MD also supervises the working of the following departments / functions : a. The Finance and the Executive Directors are under the supervision of the MD. EDP and ERP functions also.
Business Development Department Page No.CHAPTER 5 BUSINESS LEVEL FUNCTIONS AND PROCESSES 5.1 FUNCTIONAL DEPARTMENTS OF ZIM LABORATORIES 1.44 .
2 HUMAN RESOURCES DEPARTMENT 5.2. Purchase Department 4.1 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. Finished Goods & Dispatch 11. EDP & ERP 7. Materials Department a. Administrative Department 3. Research & Development 6. Accounts Department 5.45 . Quality Control 9. Human Resources Department 14. Raw Materials b. Marketing Department 5. Production Department 10. Personnel Department 13. Quality Assurance 8.2. Maintenance Department 12. Packing Materials c.
then if he/she has done some overtime work before.2 Promotion Policy. 5. Extra incentives are pointed out here in the sense of overtime work.2. There is no payment for overtime work. Performance. then that overtime work hour is adjusted towards in such emergency situation. Incentives and Leaves It was informed that there were no extra incentives to the employees apart from the monetary allowances.2.46 . Instead. 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. these credit hours are adjusted the emergency hours i.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. whenever employee wants to work less on any particular day of the week.e.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.
47 .2 Method of Marketing deployed The organization has not employed any of the direct marketing strategies i. and also for export purposes in some cases. 5.Casual (on contract basis) 300-400 5. Spoilage and Wastage 8.3. the usual process adopted is : Page No. In case of transaction with governments and institutions. Sale of Scrap.2.3 MARKETING DEPARTMENT ZIM Laboratories has its registered office in Mumbai. they are marketed for the government and institutions. for the reason of it being the financial capital of India. Scrap.3. there are also frequent visits by the Health Ministers and other top officials of the health department of the foreign country. Marketing is generally done of Finished goods and Semi-finished goods.4 Matters dealt with by the department 1.1 Role of the Marketing Department The Mumbai Office takes care of the Marketing function of the organization. In case of exports. no questionnaires nor behavioral method. In case of exports. Activities concerning welfare of employees 5. 5. Bus facility 7. Instead customers visit the factory outlets and place direct orders with the organization. Canteen facility 6. only Semi-finished goods are marketed. Provident Fund 4. 5. Salary & Wages 2.e. Incentives and Bonus Payment 3. while in case of finished goods.
3 The Market Strategies or the Business Models 1. The greatest advantage of this type of strategy is that there is following of JIT system to the tune of 80- Page No. Appointment of local agents in foreign country 3. Iraq and Yemen. Algeria. Presently.48 . the company is exporting its products to more than 25 countries. 5. Finally. Egypt. 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. iii. Tender participation 9.8. Tender awarded 10. Export The organization has export in more than 25 countries. custom manufacturing. Meeting customers through local agents appointed in that country. supply of goods. Country visit 2. However. Where organization visits foreign country :1. some of which are Bangladesh. Contract Manufacturing The organization is involved in selling of allopathic drugs according the requirements of the customer i. some of which are Maharashtra. Sri Lanka. Besides it has also covered several Central and South states in the domestic sector. ZIM holds – i. Latin America. 3rd Party Export It is selling goods locally in more than 15 countries. Vietnam. Libya. ii. B. Chattisgarh and Madhya Pradesh. 2.3. 3.e. Buyers directly approach the organization through informed visits to factory. export marketing usually involves following steps : A. UAE. Morocco. Nigeria. and thereafter places the order accordingly.
e. Loan License Manufacturing Under this strategy. since production is carried out only after receiving the specification or requirements of the order. The organization holds a Certificate of registration from DGQA i. wherein ZIM used to manufacture the drugs and medicines and dispatched them under the name and seal of the client. 5.etc. tools adopted are : Page No. WCL. Many a times.Director General of Quality and Assurance for supply in Defence sector. This is just indirect manufacture. which excludes direct marketing techniques. it is the foreign entities who approach ZIM in order to purchase these machinery and equipments. Government and Institutes ZIM also supplies drugs and syrups to government and allied institutions.49 .90%. RDPL. 6. Trading ZIM also aids those organizations which find it difficult to import instrument parts and other quality control equipments for manufacturing purposes. In case of Trade Marketing. Trade Marketing This comprises of own marketing of products. 5. since these organizations face the problem of finding the right supplier. It is the customer who directly approaches the organization either through 7.3. 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. as if to appear that the product has been marketed by that client. 4.4 Sales Promotional Techniques ZIM follows basic promotional techniques and does not goes for mere technical tools. 1. some of which are ESIC. 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
Fulfilling customer requirements.8.1 Functions of BDD a. Financial Budget 5. unless there is some voucher to support its nature of transaction.5 BUSINESS DEVELOPMENT DEPARTMENT ZIM believes that the pharmaceutical business today is poised for a great leap forward.4. To develop the organization business b. 5. Ledger Accounts 5.5.9 Voucher Entries ZIM follows the practice of entering transactions of normal or regular expenditure only through supporting vouchers. The department is a one window concept which means a one stop place for outsiders. 5. Sales Budget 3. no entry is made in the books of accounts or no payment is made. more specifically customers. Page No. To represent and deal on behalf of customers with the organization.2 Activities of BDD 1. for transacting with the organization.4. ZIM also concerns itself with the preparation of various budgets viz. The BDD is just like the Customer Care department which functions to face the competitors and focus to customer requirements. In fact. Purchase Budget 4.5. 5.53 . Overheads Budget / Cost Budget 5. 1.8 Budgets In consonance with the general practices and like other organizations. Cash Budget 2.
Monitoring performance of the agents appointed in foreign countries as also the performance of the customers with regard to the use of the products. Timely intimation to customers about introduction of new drugs and processes. right from conception to product delivery.2. Follow-up of customer and agent payment. The position can be better explained with the help of following diagram :5.5. HR QC Mkg A/c BDD Relationship Export Model Prodn . 4. The BDD acts as a connecting link between the organization departments on one hand and the agents and customers on the other hand. 5.3 THE BDD CUSTOMER RELATIONSHIP MODELS BDD Relationship Domestic Customer Model Prodn . keeping in view a strict time Page No. 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. Ensuring shipment of products in time. 3.54 . Payment of Commission to agents appointed in foreign countries on time. 6.
1 The Production Plant The production facilities are located at Kalmeshwar Industrial Area near Nagpur in Central India. Easy availability of technically qualified work force. Page No.6. Easy and economical availability of raw and packing materials.schedule.4 Composition of BDD The BDD is constituted of four interrelated cells with well-defined activities encompassing: b. A cosmopolitan. Advantages of having the production plant in such area are numerous. some of which are : Easy access by all means of transportation to all parts of the country. secular atmosphere and work culture.5. Regulation and Commercial Documentation Team. 5. material sourcing assistance and developments of products (drugs) based on specifications provided by the clients. and e. Central India is surrounded by vast tribal forest areas having their own wealth of plants of medicinal value giving it easy. d. packaging development and design. Logistics Management Team.55 . Procurement Teams c. local availability of the required plant raw materials. All the activities of BDD are geared towards providing a standing in-house representation the company to its valued customers. Plentiful electricity and water. such that both facilitate direct export/import.6 PRODUCTION DEPARTMENT\ 5. Moreover. Packaging Development Team. The BDD provides services in the form of product development. 5. A dry dock facility and further development of the nearby Industrial area (Butibori).
Steps involved in CAPSULE PROCESSING 1. Passing to Finished Goods and Packing Material Stores Finally. In Process Quality Control Check and Release 9. 8. Mixing / Blending 2. 10. Blending & Weighing 3.5. Passing to Quarantine area 5. Passing to Quarantine section 13. Quality Assurance Analysis and release 12. 6.2 Production Processes The normal production process followed by ZIM is given below : 1. Checking . Bringing in Raw Material(Active/Inactive) 2. Empty capsule loading 6. Steps involved in the process of PELLETS and TABLETS Manufacturing Page No. Receipt of Inputs 5. Capsule filling 7. Raw Material and Packing Material planning 3. Polishing Section. Unit Packing and re-IPQC Check and Release 10. Transfer of packaged products to Finished Goods store for dispatch. 2. Capsule section is divided into following : 1. Receipt of order from the customer. Material requirement planning 4.6. Packing of products. Actual manufacturing of products (drugs or processes) 7. Sifting. Sampling and re-testing of products packed. Final Packing of the Capsules 11. Testing of Inputs received.56 . the capsules are ready for packing and distribution. Testing of the manufactured product. Analysis & Release 4. Inspection and Polishing of the Capsule 8. 9.
The Double track machine. Powder is prepared 2. 7. Thereafter using PVC Sheets.57 . 3. 4. Then there is weighing of the powder and tablets using the electronic balance. A good number of talented professionals are engaged in the unending endeavor to break new grounds and bring forth fresh solutions. The products are then coated and dried using a coating pan/fluid bed coater. 9. The defective tablets are purified using the Bulk Tablet Machine. 6. However there are certain additional steps in the preparation and processing of tablets.7. After weighing. ZIM possesses an exceptional technical team. bulk density and total assay & drug release. 8. R & D requires not only a good technical team but also following of Quality check and Quality policy. Page No. the tablets are covered in the Blister Cell. 10. an independent Research & Development department and a full fledged quality Assurance department. The above steps lays down the general process for the production of tablets and pellets. Finally. the tablets and pellets are packed after electronic balance checking. It is then proceeded by an IPQC checking with regards to Moisture content.1. The R & D and Technical Services departments are key focus areas. First. preparation of Binder and there is drug layering through coating the pan.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. There is re-IPQC checking. Then the tablets/pellets are dried using an Oven and passed through vibratory sifter. 5. 5.7 R & D DEPARTMENT 5.
These talented team members ensure that the company’s customers. This ensures the company an unbeatable edge in the competitive market place. Site specific/Target release characterization. Customers at ZIM obtain high-tech product advantage. and Ready for Compression Granules for unstable. and otherwise conventionally unworkable materials rendering them Environmental friendly or processable. Page No. to a great extent and even perpetually. ZIM has a team of researchers. Products in several categories are available with diverse attributes that include conversion of Hygroscopic molecules to Non-Hygroscopic forms.7. 5. Solubility and Stability enhancement. the company’s R & D department comes into play and develops the product through its sophisticated technical department and panel of technical team members. 5. including development and validation of formulations.7. or. cost-effective and Quality products being produced after much research & development.58 . pharmaceutical & analytical method development.2 The Technology path ZIM provides its customers a wide spectrum of value-added & cost-effective services whether pertaining to manufacturing. corrosive and hazardous. derive the advantage of Innovative. Formulation Development Whenever an order is placed by a customer regarding manufacturing of a new drug or process. Taste-masking and flavouring technology for masking bitterness and obnoxious odour of active drug ingredients. The formula is developed after great research and experimentation required specifically in the field of medicines and drugs. product development.3 Activities undertaken at R & D Department 1. 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. technical assistance or regulatory affairs. scientists and technical personnel who have great competence and experience to provide a range of services. Enteric Release specifically for Acid-labile drugs.
Formulation Redesigning ZIM also undertakes the redesigning of formulations pertaining to products already in the market. 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. and informed with respect to the functional softwares.2. 5. 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. 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.59 . the information will be updated for reference and approval by other departments. Page No.
6.CHAPTER 6 OBSERVATIONS LEARNINGS AND CONCLUSIONS It was an interesting and practical experience that was gained at ZIM Laboratories during the study .The company Heads and Managers have been highly cooperative and had made good arrangements for the interactions despite their tight schedule.60 .1 OBSERVATIONS Page No.
Requirement of better co-ordination between the departments for their effective functioning. The company has ensured following of the quality policy through quality control and assurance department. 6. 2. 9. timely delivery of products to its customers. which ensures quality products and processes. which can be operated using the touch-screen system. tablets and capsules have all been imported from China. The machinery used in the production of powders. 2. The self-appraisal forms are then re-evaluated by a separate team of members appointed from each department. specially the department heads. Because of the quick functioning of the BDD. This ensures timely implementation of functions 6. 8. 5. ZIM has divided them into 15 different departments. The company’s market strategies which comprises of seven different models are unique and distinguishing. ZIM goes for selfappraisal. Despite the general performance appraisal procedures.1.2 KEY LEARNINGS The study has facilitated me in learning the following things : 1. proper co-ordination between the different departments functioning within the organization. The company has not involved itself in the providing of extra incentives to its workers and employees. 4.61 . For efficient functioning of its departments. Understanding the functioning of the various departments in the organization. 3. pellets. 7. The company has excellent research and development wing. concerned. it ensures. but follows the simple and lucid system of crediting of excess worked hours towards emergency hours required by the workers. The company in consonance with point 2 facilitates international quality standards with innovative services tailored to users need. Page No. which ensures evaluation of the true and correct productivity of the employees. besides.
There is healthy competition in the industry with entry of global giants.3. Necessity of great division of labour and technical skills in such an industry is of vital importance. PEST and Porter’s Five Forces analysis. All the departments are linked with each other. more will be the growth of the organization. The main focus on the study in ZIM was on coverage of all the departments in average. 6. and that no organization can succeed without taking into consideration this fact. ZIM is a pharmaceutical manufacturing company having diversified market strategies. 6.3 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 better the co-ordination between the departments. Through this organizational study. and fame & reputation in the central industrial belt comprising Maharashtra and adjoining states. Thus the overall study in ZIM Laboratories was a learning experience.62 . 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. The company has good marketing strategy for export and domestic market. Understanding the organization structure and the decision making process. The Indian firms should put in good efforts to overcome the competition. The company believes in providing “Affordable Quality Healthcare through Zeal and Innovation in Medicine”. Placing Customer care and Customer Service at the apex of objectives list. 5. The working of an organization is very well reflected by the working of its departments. as also the reporting procedure between the departments. or to be more specific. 4. the departments comprised in the organization. The unique feature observed was that the Business Development Department was the intermediary between the customer and the organization. Page No. They maintain good relation within the employees as well as with the customers. Learned how to carry on the SWOT.
marketing. ABBREVIATIONS AND MEANING OF TERMS NDDS . Objectives of drug Page No.Thus the company has enabled me to learn the various aspects of management. Drug development refers to activities undertaken after a compound is identified as a potential drug in order to establish its suitability as a medication.63 .New / Novel Drug Delivery System. production. Drug discovery is the process by which potential drugs are discovered or designed. finance which will be useful for my further studies.
Generic Drug is a drug which is produced and distributed without patent protection. a lack of which causes diabetes. and which is now prepared synthetically.64 . CHRONICLE Magazine– March 2009 2.January 2008 (Porters 5 forces) Page No. Insulin is a polypeptide pancreatic hormone which lowers the glucose levels in the blood. as well as to establish safety. Penicillin is an antibiotic produced naturally by certain blue moulds. BIBLIOGRAPHY Books and Magazines 1.development are to determine appropriate Formulation and Dosing. Harvard Business Review.
org 9. www.com (balance scorecard) 8. www. www.special. www. www.Websites 1.org 10.learnmarketing.managementhelp.net 5.zimlab.org 6.rediff.wikipedia.org Page No.marketingteacher.com 3.65 .hrmguide. www. www. www.balancedscorecard.net (orgnaisation structure) 7.marksonspharma.com 4. www.in 2. www.themanager.
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