A PROJECT REPORT ON

EMPLOYEE PERCEPTION TOWARDS ENGAGEMENT

AT

SRI SIVAM KNIT WEAR,TIRUPUR,

By

MBA (HR)

__________________ UNIVERSITY
20-20

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 DECLARATION

I ____________hereby declare that this project report titled “Employee

perception & engagement ” has been successfully completed at SRI SIVAM KNIT
WEAR, towards the partial fulfillment of the requirement for the award of the degree
“Master of Business Administration ”from _______________ affiliated to
____________ University. This is an original manuscript developed by me and has not
been furnished from any source thereof, has not formed the basis for the award of any
degree, diploma or any such titles by this institute or any other universities.

DATE:

LOCATION

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 ACKNOWLEDGEMENT

It gives me great pleasure to express my boundless sense of gratitude to each

and every person who directly or indirectly helped me with hand and hand in completing
this humble piece of work.

First, of all I would like to thank ___________ (HR- Assistant Manager) & _____
(HR-Manager) under whose supervision and guidance this report was completed.

I specially remember and extend my humble words of thanks to my internal

guide __________ for her guidance.

I am also thankful to my parents and friends who were in some or the other way
helpful to me in successfully completing this research study.

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S.NO INDEX PAGE NO.

1 EXECUTIVE SUMMARY. 5

2 INTRODUCTION 7

3 REVIEW OF LITERATURE 20

4 INDUSTRY PROFILE 30

5 COMPANY PROFILE 45

6 RESEARCH METHODOLOGY 62

7 ANALYSIS AND DIAGRAMMATIC INTERPRETATION 70

8 CONCLUSION 81

9 ANNEXURE 85

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Executive summary.

The ability of the organization to attain its goals largely depends upon the
effectiveness of its Employee perception & engagement Program. Therefore it deserves
great planning and care to formulate and implement Employee perception &
engagement strategies.

The main objectives of the project is to study the existing process of Employee
perception & engagement in an well reputed MNC , to explore the current trends in the
industry in Employee perception & engagement practices.

A detailed and exhaustive exploratory research is done over the net through
relevant websites to delineate appropriate Employee perception & engagement
methods to understand the current trends in the Industry and to know the company
profile.

A questionnaire was undertaken as a tool for the extraction of the effectiveness

of the Employee perception & engagement. The 15 candidates from SRI SIVAM
KNIT WEAR had answered the questionnaires. The answered questionnaires were,
then analyzed. To define in a capsule, it was more of an observation to find the
effectiveness of Employee perception & engagement.

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Abstract
Employee perception & engagement is the level of commitment and involvement
an employee has towards their organization and its values. An engaged employee is aware
of business context, and works with colleagues to improve performance within the job for
the benefit of the organization. It is a positive attitude held by the employees towards the
organization and its values. The paper focuses on how employee perception & engagement
is an antecedent of job involvement and what should company do to make the employees
engaged. The paper also looks at the Gallup 12 point questionnaire, twelve-question survey
that identifies strong feelings of employee perception & engagement and the steps which
shows how to drive an engaged employee.

Introduction
Engagement at work was conceptualized by Kahn, (1990) as the ‘Harnessing of
Organizational Members selves to their work roles’, In engagement, people employ and
express themselves physically, cognitively, and emotionally during role performances.
The second related construct to engagement in organizational behavior is the notion of flow
advanced by Csikszentmihalyi (1975, 1990). Csikzentmihalyi (1975) defines flow as the
‘Holistic Sensation’ that, people feel when they act with total involvement. Flow is the
state in which there is little distinction between the self and environment. When individuals
are in Flow State little conscious control is necessary for their actions.
Employee perception & engagement is the thus the level of commitment and involvement
an employee has towards their organization and its values. An engaged employee is aware
of business context, and works with colleagues to improve performance within the job for
the benefit of the organization. The organization must work to develop and nurture
engagement, which requires a two-way relationship between employer and employee.’
Thus Employee perception & engagement is a barometer that determines the association of
a person with the organization
Engagement is most closely associated with the existing construction of job involvement
(Brown 1996) and flow (Csikszentmihalyi, 1990). Job involvement is defined as ‘The
degree to which the job situation is central to the person and his or her identity (Lawler &
Hall, 1970). Kanungo (1982) maintained that job involvement is a ‘Cognitive or belief state
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of Psychological identification. Job involvement is thought to depend on both need saliency
and the potential of a job to satisfy these needs. Thus job involvement results form a
cognitive judgment about the needs satisfying abilities of the job. Jobs in this view are tied
to one’s self-image. Engagement differs from job in as it is concerned more with how the
individual employees his/her self during the performance of his / her job. Furthermore
engagement entails the active use of emotions. Finally engagement may be thought of as an
antecedent to job involvement in that individuals who experience deep engagement in their
roles should come to identify with their jobs.

When Kahn talked about employee perception & engagement he has given important to all
three aspects physically, cognitively and emotionally. Where as in job satisfaction
importance has been given more to cognitive side.
HR practitioners believe that the engagement challenge has a lot to do with how
Employee feels about the about work experience and how he or she is treated in the
organization. It has a lot to do with emotions which are fundamentally related to drive
bottom line success in a company. There will always be people who never give their best
efforts no matter how hard HR and line managers try to engage them. “But for the most part
employees want to commit to companies because doing so satisfies a powerful and a basic
need in connect with and contribute to something significant”.

Aspects of Employee perception & engagement

Three basic aspects of employee perception & engagement according to the global studies
are:-
 The employees and their own unique psychological make up and experience
 The employers and their ability to create the conditions that promote employee
perception & engagement
 Interaction between employees at all levels.
Thus it is largely the organization’s responsibility to create an environment and culture
conducive to this partnership, and a win-win equation.

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Categories of Employee perception & engagement

According to the Gallup the Consulting organization there are there are different types of
people:-

Engaged--"Engaged" employees are builders. They want to know the desired

Expectations for their role so they can meet and exceed them. They're naturally curious
about their company and their place in it. They perform at consistently high levels. They
want to use their talents and strengths at work every day. They work with passion and they
drive innovation and move their organization forward

Not Engaged---Not-engaged employees tend to concentrate on tasks rather than the goals
and outcomes they are expected to accomplish. They want to be told what to do just so they
can do it and say they have finished. They focus on accomplishing tasks vs. achieving an
outcome. Employees who are not-engaged tend to feel their contributions are being
overlooked, and their potential is not being tapped. They often feel this way because they
don't have productive relationships with their managers or with their coworkers.
Actively Disengaged--The "actively disengaged" employees are the "cave dwellers."
They're "Consistently against Virtually Everything." They're not just unhappy at work;
they're busy acting out their unhappiness .They sow seeds of negativity at every
opportunity. Every day, actively disengaged workers undermine what their engaged
coworkers accomplish. As workers increasingly rely on each other to generate products and
services, the problems and tensions that are fostered by actively disengaged workers can
cause great damage to an organization's functioning.

Importance of Engagement
Engagement is important for managers to cultivate given that disengagement or
Alienation is central to the problem of workers’ lack of commitment and motivation
(Aktouf). Meaningless work is often associated with apathy and detachment from ones
works (Thomas and Velthouse). In such conditions, individuals are thought to be estranged
from their selves (Seeman, 1972) .Other Research using a different resource of engagement
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(involvement and enthusiasm) has linked it to such variables as employee turnover,
customer satisfaction – loyalty, safety and to a lesser degree, productivity and
profitability criteria (Harter, Schmidt & Hayes, 2002).

An organization’s capacity to manage employee perception & engagement is closely

related to its ability to achieve high performance levels and superior business results. Some
of the advantages of Engaged employees are
 Engaged employees will stay with the company, be an advocate of the company and
its products and services, and contribute to bottom line business success.
 They will normally perform better and are more motivated.
 There is a significant link between employee perception & engagement and
profitability.
 They form an emotional connection with the company. This impacts their attitude
towards the company’s clients, and thereby improves customer satisfaction and
service levels
 It builds passion, commitment and alignment with the organization’s strategies and
goals
 Increases employees’ trust in the organization
 Creates a sense of loyalty in a competitive environment
 Provides a high-energy working environment
 Boosts business growth
 Makes the employees effective brand ambassadors for the company

A highly engaged employee will consistently deliver beyond expectations. In the

workplace research on employee perception & engagement (Harter, Schmidt & Hayes,
2002) have repeatedly asked employees ‘whether they have the opportunity to do what they
do best everyday’. While one in five employees strongly agree with this statement. Those
work units scoring higher on this perception have substantially higher performance.
Thus employee perception & engagement is critical to any organization that seeks to retain
valued employees. The Watson Wyatt consulting companies has been proved that there is
an intrinsic link between employee perception & engagement , customer loyalty, and
profitability. As organizations globalize and become more dependent on technology in a
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virtual working environment, there is a greater need to connect and engage with employees
to provide them with an organizational ‘identity.’

Factors Leading to Employee perception & engagement -

Studies have shown that there are some critical factors which lead to Employee
engagement. Some of them identified are:

Career Development- Opportunities for Personal Development

Organizations with high levels of engagement provide employees with opportunities
to develop their abilities, learn new skills, acquire new knowledge and realize their
Potential. When companies plan for the career paths of their employees and invest in them
in this way their people invest in them.

Career Development – Effective Management of Talent

Career development influences engagement for employees and retaining the most
talented employees and providing opportunities for personal development.

 Feeling Valued & Involved

 Career Development- Opportunities for personal development
 Career Development – Effective Management of talent
 Leadership- Clarity of company Values
 Leadership – Respectful treatment of employees
 Leadership – Company’s standards of ethical behavior
 Empowerment Image
 Equal opportunities & fair treatment
 Performance Appraisal
 Pay & benefits
 Health & Safety
 Job satisfaction
 Communication
 Family friendliness
 Co-operation

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Leadership- Clarity of Company Values

Employees need to feel that the core values for which their companies stand are
unambiguous and clear.

Leadership – Respectful Treatment of Employees

Successful organizations show respect for each employee’s qualities and
contribution –regardless of their job level.

Leadership – Company’s Standards of Ethical Behavior

A company’s ethical standards also lead to engagement of an individual
Empowerment
Employees want to be involved in decisions that affect their work. The leaders of
high engagement workplaces create a trustful and challenging environment, in which
employees are encouraged to dissent from the prevailing orthodoxy and to input and
innovate to move the organization forward.
Image
How much employees are prepared to endorse the products and services which their
company provides its customers depends largely on their perceptions of the quality of those
goods and services. High levels of employee perception & engagement are inextricably
linked with high levels of customer engagement.
Other factors:

Equal Opportunities and Fair Treatment

The employee perception & engagement levels would be high if their bosses
(superiors) provide equal opportunities for growth and advancement to all the employees
Performance appraisal
Fair evaluation of an employee’s performance is an important criterion for
determining the level of employee perception & engagement . The company which follows
an appropriate performance appraisal technique (which is transparent and not biased) will
have high levels of employee perception & engagement .

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Pay and Benefits
The company should have a proper pay system so that the employees are motivated
to work in the organization. In order to boost his engagement levels the employees should
also be provided with certain benefits and compensations.

Health and Safety

Research indicates that the engagement levels are low if the employee does not feel
secure while working. Therefore every organization should adopt appropriate methods and
systems for the health and safety of their employees.

Job Satisfaction
Only a satisfied employee can become an engaged employee. Therefore it is very
essential for an organization to see to it that the job given to the employee matches his
career goals which will make him enjoy his work and he would ultimately be satisfied with
his job.
Communication
The company should follow the open door policy. There should be both upward and
downward communication with the use of appropriate communication channels in the
organization. If the employee is given a say in the decision making and has the right to be
heard by his boss than the engagement levels are likely to be high.
Family Friendliness
A person’s family life influences his wok life. When an employee realizes that the
organization is considering his family’s benefits also, he will have an emotional
attachment with the organization which leads to engagement
Co-operation
If the entire organization works together by helping each other i.e. all the employees
as well as the supervisors co-ordinate well than the employees will be engaged.
How to measure Employee perception & engagement?
Gallup research consistently confirms that engaged work places compared with least
engaged are much more likely to have lower employee turnover, higher than average
customer loyalty, above average productivity and earnings. These are all good things that
prove that engaging and involving employees make good business sense and building
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shareholder value. Negative workplace relationships may be a big part of why so many
employees are not engaged with their jobs.

Step I: Listen
The employer must listen to his employees and remember that this is a continuous
process. The information employee’s supply will provide direction. This is the only way to
identify their specific concerns. When leaders listen, employees respond by becoming more
engaged. This results in increased productivity and employee retention. Engaged employees
are much more likely to be satisfied in their positions, remain with the company, be
promoted, and strive for higher levels of performance.

Step II: Measure current level of employee perception & engagement

Employee perception & engagement needs to be measured at regular intervals in
order to track its contribution to the success of the organization.
But measuring the engagement (feedback through surveys) without planning how to handle
the result can lead employees to disengage. It is therefore not enough to feel the pulse—the
action plan is just as essential.
Knowing the Degree in which Employees Are Engaged?
Employee perception & engagement satisfaction surveys determine the current level
of employee perception & engagement. A well-administered satisfaction survey will let us
know at what level of engagement the employees are operating. Customizable employee
surveys will provide with a starting point towards the efforts to optimize employee
perception & engagement .
The key to successful employee satisfaction surveys is to pay close attention to the
feedback from the staff. It is important that employee perception & engagement is not
viewed as a one-time action. Employee perception & engagement should be a continuous
process of measuring, analyzing, defining and implementing.
The employee survey is a diagnostic tool of choice in the battle for the hearts of
employees. Studies of Gallup, Mercer, Hewitt and Watson Wyatt (consulting companies)
asked workers number of questions relating to their job satisfaction. Gallup being one of
oldest the consulting organization {in conducting engagement survey} creates a feedback
system for employers that would identify and measure elements of worker engagement
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most tide to the bottom line. Things such as sales, growth, productivity and customer
loyalty are all accessed. After Hundreds of focus group and thousands of interviews with
employees in a variety of industries, Gallup came up with Q. 12, a twelve-question survey
that identifies strong feelings of employee perception & engagement . They have identified
12 questions that most effectively measure the links (the Gallup Q12).

I. Do you know what is expected of you at work?

II. Do you have the materials and equipment you need to do your work right?
III. At work, do you have the opportunity to do what you do best every day?
IV. In the last seven days, have you received recognition or praise for doing good work?
V. Does your supervisor, or someone at work, seems to care about you as a person?
VI. Is there someone at work who encourages your development?
VII. At work, do your opinions seem to count?
VIII. Does the mission/purpose of your company make you feel your job is important?
IX. Are your associates (fellow employees) committed to doing quality work?
X. Do you have a best friend at work?
XI. In the last six months, has someone at work talked to you about your progress?
XII. In the last year, have you had opportunities at work to learn and grow?

Some of the discussions which come from Gallup’s questions are: -

Know what is expected of me at work-
Employees should know exactly what is expected of them. If expectations are
unclear, employees will inevitably face frustration, and will be open for other opportunities
where they do know what's expected of them, and where their contributions are measured
and recognized.
Materials and equipment-
Employees need the right tools and equipment to support their skills, experience and
talents & perform their jobs at an optimum level.

Do what I do best every day –

Are your employees cast in the right roles? Knowing the critical demands for every
role is a key to ensuring that talents fit those demands.
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Supervisor/Someone at work care
Managers must spend most of their time with their most productive talent. Many
managers give their greatest degree of attention to employees who are falling behind.
Talented, productive people crave time and attention from their managers, and will leave
your company if they have a weak relationship (or no relationship) with their manager or
supervisor.
Co-workers committed to quality –
Many companies arbitrarily put teams together without considering that employees
only psychologically commit to teams if they perceive their team members will support
their high level of commitment and performance. Talented employees set high standards
and depend upon those around them to support their growth
towards excellence.
Opportunities to learn and grow-
The Company should create an environment that encourages employees to drive
towards innovation or to create better systems for more productive results. Great managers
always ask what skills and knowledge need to accompany talent to result in the greatest
outcome for each employee.
As discussed the Gallup study Q12 is based on positive Psychology and emotions.
Having a best friend at work or receiving recognition every week makes you feel cared for
and proud respectively. If you want to keep recreating those positive emotions, then you
keep coming back to work.
So the Q. 12 measures engagement, and engagement is a positive emotional connection to
the work. Thus the mechanism of the broaden- and – build theories and the action
tendencies of positive emotions help in understanding why the Q. 12 has been so powerful
for Gallup in terms of predicting outcomes. Borden – and Build theory is about
evolutionary significance of positive emotions. Positive emotions are better observed over
the long haul. Their effects accumulate and compound overtime and the adaptive benefits
are evident from later, when people face new challenges. The Gallup research
has thus made a contribution in adding an additional ‘P’ to the 4 P’s of marketing i.e.
product, price, and promotion place and now people to the mix. In the combination of
engaged employees, Gallup brings engaged customers to form the concept of human sigma.
These include customer engagement, loyalty and emotional attachment. Customer
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engagement hierarchy, customer engagement scores and developing the culture of
engagement and customer focus. The Gallup Organization decided to initiate a multi-year
research project to try and define a great workplace - a great workplace was one where
employees were satisfied with their jobs and this thus helps to produce positive business
outcomes.
According to the study of Watson Wyatt, the service – profit chain establishes
Relationship between profitability, customer loyalty and employee satisfaction, loyalty and
productivity. The links in the chain (which should be regarded as propositions) are as
follows: profit and growth are stimulated primarily by customer loyalty. Loyalty is a direct
result of customer’s satisfaction. Satisfaction is largely influenced by the services provided
to customers. Satisfied, loyal and productive employees create value.
Employee’s satisfaction in turn results primarily from high quality support services and
policies that enable employees to deliver results to customers. While many organizations
are beginning to measure relationship between individual links in the service only a few
have related the links in the meaningful ways that can lead to comprehensive strategies for
achieving lasting competitive advantage of building employee perception & engagement .
In a study of its seven telephone customer service centers (MCI found that there is a clear
relationship between employee’s perceptions of the quality of services and employee
perception & engagement).
Step III: - Identify the problem areas
Identify the problem areas to see which are the exact areas, which lead to
disengaged employees

Step IV: Taking action to improve employee perception & engagement by acting
upon the problem areas
Nothing is more discouraging to employees than to be asked for their feedback and
see no movement toward resolution of their issues. Even the smallest actions taken to
address concerns will let the staff know how their input is valued. Feeling valued will boost
morale, motivate and encourage future input. Taking action starts with listening to
employee feedback and a definitive action plan will need to be put in place finally.

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 REVIEW OF LITERATURE

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 CHAPTER 2: REVIEW OF LITERATURE

Major studies conducted by various researchers are as discussed below:

Bagchi (1997) critically examined the removal of quota between 1995-2005 in four

phases is not as beneficial as it is projected by developed world. The first two phases are

composed of goods which are not of high importance and already almost free. These two

phases are not of high importance. The other two phases are of high importance.

Chandra (1998) in his article wrote on challenges ahead of Indian textile and clothing

industry in post quota regime. It put special emphasis on production capabilities and

efficiencies as most essential elements to fight global competition. It suggests various

strategic decisions Indian textile manufacturers have to make to survive the

competitiveness in post quota regime.

Simpson and Shetty (2001) did a vast study on India’s textile industry. The purpose of

study is to analyze India’s textile and apparel industry, its structural problems, market

access barriers, and measurements taken by government of India to enhance the

industry’s competitiveness in the post – Multifibre Agreement (MFA) era. The study also

assesses India’s textile and apparel market potential and trade and investment

opportunities for U.S. firms as India steps into a more free and transparent trade regime.

For the purpose of study exploratory study is done in which in-depth interviews are done

with various government officials in Textile Export Promotion Council, Ministry of

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textile, Cotton Council of India, Apparel Export Promotion Council (AEPC), Federation

of Karnataka Chamber of Commerce and Industry, Handloom Export Promotion Council,

Madras Chamber of Commerce and Industry, The South India Textile and Research

Association, and almost all top executives of India’s large textile mills.

Verma (2001) in his article emphasized on the impact on the Indian textile and clothing

industry after quota elimination. It says that Indian textile and clothing exporters have to

bring in necessary changes in their methods of production, management style, capacities,

marketing skills and productivity level in order to remain competitive in international

market. Also it put special emphasis on the size of Indian textile units when compared to

its counterpart in China.

Verma (2002) did a comprehensive study with objective to evaluate the export

competitiveness of Indian textile and clothing sector. Because Indian textile and clothing

sector is predominantly cotton based, the study is focused on cotton textile and clothing

and look at the entire value chain from fiber to garment and retail distribution. The scope

of study covers the products in Indian export basket which have shown a promising

growth in value. The Study concludes that Indian exports to US and EU are export

competitive as a whole. Sector wise analysis of export performance of Indian textile and

clothing sectors to US and EU reveal that so far apparel or clothing and made-up is

concerned; quota is the major constraint in the growth, while it is not true in case of yarn

exports. Indian textile and clothing sector has tremendous potential and only a portion of

which is explored till now and this shortcoming is due to policy constraints.

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Meenakshi (2003) did a comprehensive study on the opportunities that would be

provided by WTO to Indian Textile industry. This paper gives a lot emphasis on new

capacity installation to take the benefits to the fullest extent in India has to be a true

gainer in competition to other nations. Since India’s own consumption per capita is also

on the rise with the rise of income and consumption habits, the profit margins available to

Indian textile and clothing producers will be more. But in export market, the prices will

be driven by international factors and profits will be under pressure. So the exporters

might have to go for strategy of partial exports and partial domestic sale.

Pandey (2003) in his article expected that Indian textile exporter would be benefited with

quota elimination. It discusses on various sectors of textile and clothing. Also he expects

that hosiery industry will be one of the gainer and small scale exporters will be more

competitive due to small size and controlled cost and lower overheads.

Uraiwan (2004) had worked extensively on the knitwear/hosiery products development

process to understand the complexities underlying in it; because a well defined

development process assist the organization to determine its future direction, plan for

rapid changes, create new product line with profits and plan for technology adaptation

and implementation. The goal of this research was to propose an optimal product

development process for a knitwear/hosiery company by examining the process used by

major US Sweater Company and comparing its process to established processes.

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Vivek (2004) in his article had said that JC Penny a leading retail chain of US looks India

for sourcing its garments in woven and hosiery. He is of opinion that India will be

fulfilling its major need of Hosiery and woven garments in cotton while China will be

good for synthetic fabrics and its garments.

Chugan (2005) emphasized that Indian textile Industry has to change to be more

competitive in the long run. This paper emphasis that merely cost competence is not

enough to maintain the lead while Indian companied has to have a global competitive

view.

Chugan (2005) in his study emphasized on the role of HR in this booming sector. To

maintain its edge over its competitors India has to bring in high productivity per

employee. India’s productivity is far below than China and Pakistan which are the major

competitors. With high productivity, another area is innovativeness to bring in new

products and process, where HR plays the prominent role.

Trivedi (2005) in his article concluded that the textile is one sector where India has high

ambitions and can achieve robust growth through moderate human skills. India has

skilled labor and does better in this sector as compared to others. This will also Increase

the employment and the social structure will be better off.

Thomas (2005) in his article wrote on why in the competitive scenario wholesalers like

Nike are shy from keeping long inventories and stocks. So pressure is on garment

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companies to deliver the goods in time. India has bottleneck in infrastructure, which

hinders the time receipt of raw material and delivery of finished goods. This would cause

rapid airfreight and would squeeze the margins. Government has to invest heavily in

Infrastructure to keep the pace of growth of garment industry intact and take the benefits

to fullest extent.

Adhikari (2006) did study for UNDP regional centre Colombo. It was expected that the

effect of quota elimination would not be same for all the countries. It has shown mixed

results so far. Moreover countries that have lost out the most had seen their exports

decline earlier which mean that their dismal performance merely be ascribed to the quota

phase out. Several countries that had been expected to lose out in the post quota world not

only managed to hold on to their past gains but also achieved significant growth in their

export earnings. This is mainly because of the re-imposition of quota on T&C exports

from China not only by developed countries but also by some developing countries,

which were making use of temporary safeguards measures as agreed to by China during

the process of its accession to WTO. Most analysts predicted that the situation will not

remain same after the phasing out of safeguard which will expire in 2008. At the same

time the entry of Vietnam into the WTO from 11th January 2007, which enables the

county to compete in global T&C market without any quantitative restrictions on T&C

exports, means that the competitive pressure is likely to be intense for the small and

marginal players. Therefore the real adjustment challenges are yet to begin after

December 2008.

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Chaudhry (2006) did a very comprehensive study on the productivity of Indian Textile

sector and various related sectors. Very technical formulas are used to analyze the

competitiveness of Indian Textile Industry.

Chugan (2006) in his article discussed in detail the opportunities available to various

sectors of Indian Textiles in the post quota era. Also, it emphasizes the weaker link,

competition from china and the schemes run by government to support Indian textile

Industry.

Elsayeed, Kulich, Lake & Megahed (2006) gave deep insight into the success factors of

Guangdong textile cluster of China. Also it discusses the national diamond analysis

which describes the competitive advantage and weakness in context of firm strategy,

rivalry and strength in the related and supporting industries and limited demand

conditions. Also it discusses the trade relations between China and Hong Kong and role

of Chinese Diaspora and its role in success of Guangdong textile cluster. Also, it put

emphasis on China – H.K relations as win-win situation for both. Then it discusses the

cluster analysis.

Jayaswal and Sayed (2006) in his article presented how Pakistan has done excellent and

dominating the home furnishing and bed linen section in US and EU. India Bed linen is

no more preferred in US. Pakistan is completely dominating the US markets. If Indian

companies become more competitive in quality, price and deliveries, it will not be

preferred destination for EU and US.

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Kumar (2006) did study of various sectors of Indian and Chinese textiles. This paper

concludes and highlights the various areas where India has efficiency over china and how

India should more capitalize on it. Also it gives equally weightage to Chinese advantages

and how India can win over its weaker areas to be more competitive in long run.

Singh and Kathuria (2006) in his article discussed in details the problems faced by

Indian garment exporters in post quota regime. The study focuses on the analysis of

problems of garment exporters located in Ludhiana and Delhi. It highlights the factors

which are hindrance in the growth of garment exports from the region and important

determinants in increasing the exports share from the region.

Texprocil (2007) in his article concluded that if India has to keep maintaining its edge in

hosiery and garment sector, it has to keep in control thru various measures. The various

measures Indicated are raw material, Methodology, Labor wages, Power cost and utilities

that need to be kept in check to keep the cost lower. This paper presents a comparative

study of Indian textile industry with other nations like China, Bangladesh, Vietnam,

Egypt and Pakistan and elaborates the competitiveness of Indian textile and various

sectors in Textiles. It also puts lots of emphasis on the areas where India in losing its edge

and has to keep a close monitoring on it to remain competitive. It concludes that Vietnam

and Egypt are coming up fast and can prove to be tough competitor in near future due to

high productivity and low steam cost.

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Shen (2008) examined major changes in China’s textile and clothing industries, studies

their reactions to quota elimination, and explore the current status of China’s textile and

clothing industry. Fourteen in-depth interviews were conducted at the end of 2005 and

beginning of 2006 in China. Four themes were found. The study tends to examines: (a)

overall status of China’s Textile and Clothing Industries, (b) advantages and

disadvantages of different textile and clothing manufacturers in China, (c) main

challenges and problems faced by China’s textile and clothing companies, (d)

corresponding strategies for the textile and clothing manufacturing companies in China to

address new challenges. There is a unique feature of this study. This study was

conducted in end of 2005 and beginning of 2006, when the fresh agreement on quota

between China and EU and China and US were reached and in place for next 3 years. So,

all interviewers were able to present their view on what happened during the year 2005.

If we look at the limitation part of the study, we find that the sample size was

comparatively small. Looking at the size of Chinese textile and clothing industry, sample

size of 14 is fairly small. Also, it is not exclusively for clothing or hosiery industry. China

is more competitive in clothing than in textile. Impact of increasing cost of energy is

more on textile than in clothing because the requirement of energy is more in textile than

in clothing. Another limitation of the study is the language used to conduct the interview.

The language used was Chinese and after it all data and information was translated into

English for publication purpose. During interviews lots of information is received which

is not translated and it misses some important information. This is because of difference

of two languages. Also, it is still very difficult to conduct any interview in China.

29
Zhang and Hathcote (2008) wrote on factor influencing apparel imports from China.

This paper gives detailed insight into the factors which are determinant of apparel and

textile exports from China to US. The Study examines the impact of quota phase out

effect on apparel trade between US and China poet 2005 quota elimination. To achieve

the four critical variables – Quota price, tariffs, labor cost, and freight cost, associated

with US import volumes are identified and studied. The study is based on Factors

Proportions Trade Theory which is also known as Heckscher-Ohlin theory is considering

two factors of production, labor and capital which are used to produce two commodities.

The two commodities differ in labor/capital ratio employed to produce them. China has

comparatively large abundance of labor and scarcity of capital while US have shortage of

labor and abundance of capital. Based on the theory of factors proportion, a country

should specialize in production and export of commodity for which it has easily available

resources.

Bedi (2009) in his article had prepared detailed report on Indian textile industry covering

various sector of textile industry. This is one of the most comprehensive reports coveting

all aspects of textile industry, performance and hindrances in the growth of it.

Venkatachalam and Palanivelu (2010) did detailed study on marketing strategies

adopted by garment exporters in Tirupur. In this paper the authors highlight the problems

of garment industries and propose solution to overcome these problems.

None of the studies given above is concentrated on Ludhiana hosiery industry. So

there is gap in the information available on it. Therefore the need for study is felt.

30
31
32
 The Textile industry in India traditionally, after agriculture, is the only industry
that has generated huge employment for both skilled and unskilled labor in textiles. The
textile industry continues to be the second largest employment generating sector in India. It
offers direct employment to over 35 million in the country. The share of textiles in total
exports was 11.04% during April–July 2010, as per the Ministry of Textiles. During 2009-
2010, Indian textiles industry was pegged at US$55 billion, 64% of which services domestic
demand. In 2010, there were 2,500 textile weaving factories and 4,135 textile finishing
factories in all of India.

History

The archaeological surveys and studies have found that the people of Harrapan
Civilization knew weaving and the spinning of cotton four thousand years ago. Reference to
weaving and spinning materials is found in the Vedic Literature also.

There was textile trade in India during the early centuries. A block printed and resist-dyed
fabrics, whose origin is from Gujarat is found in tombs of Fostat, Egypt. This proves that
Indian export of cotton textiles to the Egypt or the Nile Civilization in medieval times were
to a large extent. Large quantity of north Indian silk was traded through the silk route in
China. to the western countries. The Indian silk were often exchanged with the western
countries for their spices in the barter system. During the late 17th and 18th century there
were large export of the Indian cotton to the western countries to meet the need of the
European industries during industrial revolution. Consequently there was development of
nationalist movement like the famous Swadeshi movement which was headed by the
Eurobond Ghosh.

There was also export of Indian silk, Muslin cloth of Bengal, Bihar and Orissa to other
countries by the East Indian company. Bhilwara is known as textile city.

Production in decentralized sector

India is the second largest producer of fiber in the world and the major fiber produced
is cotton. Other fibers produced in India include silk, jute, wool, and man-made fibers. 60%
of the Indian textile Industry is cotton based.
33
The strong domestic demand and the revival of the Economic markets by 2009 has led to
huge growth of the Indian textile industry. In December 2010, the domestic cotton price was
up by 50% as compared to the December 2009 prices. The causes behind high cotton price
are due to the floods in Pakistan and China. India projected a high production of textile (325
lakh bales for 2010 -11) There has been increase in India's share of global textile trading to
seven percent in five years. The rising prices are the major concern of the domestic
producers of the country.

 Man Made Fibers: These includes manufacturing of clothes using fiber or filament
synthetic yarns. It is produced in the large power loom factories. They account for
the largest sector of the textile production in India. This sector has a share of 62% of
the India's total production and provides employment to about 4.8 million people.
 The Cotton Sector: It is the second most developed sector in the Indian Textile
industries. It provides employment to huge amount of people but its productions and
employment is seasonal depending upon the seasonal nature of the production.
 The Handloom Sector: It is well developed and is mainly dependent on the SHGs for
their funds. Its market share is 13%.[6] of the total cloth produced in India.
 The Woolen Sector: India is the 7th largest producer of the wool in the world. India
also produces 1.8% of the world's total wool.
 The Jute Sector: The jute or the golden fiber in India is mainly produced in the
Eastern states of India like Assam and West Bengal. India is the largest producer of
jute in the world.
 The Sericulture and Silk Sector: India is the 2nd largest producer of silk in the world.
India produces 18% of the world's total silk. Mulberry, Era, Tasar, and Muga are the
main types of silk produced in the country. It is a labor-intensive sector.

34
Indian Textile Policy

Government of India passed the National Textile Policy in 2000

 Textile Organization
 The Indian Textile industries is mainly dominated by some government, semi government
and private>institutions.
The major functions of the ministry of Textile are:
 Bhilwara Textiles Industry
 Textile Policy & Coordination
 Man-made Fiber Industry
 Cotton Textile Industry
 Jute Industry
 Silk and sericulture Industry
 Wool Industry
 Decentralized Power loom Sector
 Export Promotion
 Planning & Economic Analysis
 Finance Matters
 Information Technology(IT)

The advisory boards include:

 All India Handlooms Board

 All India Handicrafts Board
 All India Power looms Board
 Advisory Committee under Handlooms Reservation of Articles for Production
 Co-ordination Council of Textiles Research Association
 MM cotton industry

35
The major export promoting councils include:

 Apparel Export Promotion Council, New Delhi

 Carpet Export Promotion Council, New Delhi
 Cotton Textiles Export Promotion Council, Mumbai

The major PSU or Public Sector Undertaking are:

 National Textile Corporation Ltd. (NTC)

 British India Corporation Ltd. (BIC)
 Cotton Corporation of India Ltd. (CCI)
 Jute Corporation of India Ltd. (JCI)
 National Jute Manufacturers Corporation (NJMC)
 Handicrafts and Handlooms Export Corporation (HHEC)
 National Handloom Development Corporation (NHDC)
 Export Promotion Council for Handicrafts, New Delhi
 Handloom Export Promotion Council, Chennai
 Indian Silk Export Promotion Council, Mumbai
 Power loom Development & Export Promotion Council, Mumbai
 Synthetic & Rayon Textiles Export Promotion Council, Mumbai
 Wool & Woolen Export Promotion Council, New Delhi

Other autonomous bodies in this industry are:

 Central Wool Development Board, Jodhpur

 National Institute of Fashion Technology, New Delhi
 National Centre for Jute Diversification

The textile Research Associations are:

 South India Textiles Research Association (SITRA), Coimbatore

36
  Ahmedabad Textiles Industry’s Research Association
 Bombay Textiles Research Association, Mumbai

 Indian Jute Industries Research association, Kolkata

 Man-made Textiles Research Association, Surat
 Synthetic and art silk –Mills Research Association, Mumbai
 Wool Research Association, Thane
 Northern India Textiles Research Association (NITRA), Ghaziabad

Organized sector

According to Kearney’s ‘Retail Apparel Index’ India ranked as the fourth most
promising market for apparel retailers in 2009.

There is large scope of improvement in the textile industry of India as there is a huge
increase in personal disposable income among the Indians after the 1991 liberalization.
There is also a large growth of the organized sector in the Indian textile industries. The
foreign brands along with the collaboration of the Indian companies established business in
India. Some of these are Puma, Armani, Benetton, Esprit, Levi Strauss, Hugo Boss, Liz
Claiborne, Crocs etc.

The major Indian Industries include Bombay Dyeing, Cabinda, Grasim Industries, JCT

Limited, Lakshmi Machine Works, Lakshmi Mills and Silk Factory.

Historical Background

The Indian textile industry has a great legacy, which is perhaps unmatched
in the history of India’s industrial development. India’s textile industry evolved and developed at
a very early stage and its manufacturing technology was amongst the best. Prior to colonization,
India’s manually operated textile machines were among the best in the world, and served as a
model for production of the first textile machines in newly industrialized Britain and Germany.
Indian textiles were sought after for their finesse, quality and design. According to Chouta-Kuan,
the Chinese observer preference was given to the Indian weaving for its and delicacy’ Prestige

37
trade textiles such as Patola from Patan and Ahmedabad, coast were sought after by the
Malaysian royalty and wealthy traders of the Philippines.
Textiles have historically formed an important component of India’s exports. Marco Polo’s
records show that Indian textiles used to be exported to China and South-East Asia. Textiles have
also comprised a significant portion of the Portuguese trade with India. These included
embroidered bedspreads, wall hangings and quits of embroidered wild silk on a cotton or jute
ground.

The attractiveness of the fast dyed, multi-colored Indian prints on cotton (chintz) in Europe led to
the formation of the London East India Company in 1600, followed by Dutch and French
counterparts. By the late 1600s there was overwhelming demand for their governments to ban
the import of these cottons from India.
The legacy of the Indian textile industry stemmed from its wealth in natural resources silk,
cotton and jute. The textile industry stemmed from its wealth in natural resources silk, cotton and
jute, the technology used was superior and the skills of the weavers gave the finished product a
most beautiful and ethnic look. The Indian textile industry with such a great pedigree could have
gone only on way from here. But same did not happen.
Colonization - An End of the Indian Textile Legacy

Colonization put an end to India’s glorious textiles legacy. The British

knew that they could not compete with Indian textile industry and as a result resorted to complete
destruction of the industry. By 1880 the domestic market had grown to be serviced solely by the
British manufacturers: India, once the world’s leading exporters of textiles, was forced to
become a net importer. Tariffs were kept out of the British market.
One of the aspects of India’s freedom struggle, ked by Mahatma Gandhi, was to weaken the
British textile industry by wearing homespun clothes. Gandhiji was convinced that the textile
sector could a catalyst in advancement of the Indian population by creating employment for the
excess labor pool.
Post-independence, till about the late 1980s, the Government of India put
numerous policies and regulations in place to ensure that mechanization did not occur and that
labour-intensive textiles were produced, large-scale production was discouraged by restrictions
on total capacity and mechanization of mills. The labor regulations did not allow capital

38
investment and resulted in high production costs. Imposition of price restrictions, along with
decreased productivity, severely hampered the competitiveness of the sector.
Till 1985, the main concerns of Government policies were centered on import substitution,
protection of existing employment in the organized sector and support for decentralized sector.
These concerns were reflected in the government policies such as imposition of quotas on yarn
export, strong exit barriers even for unviable operations, general discouragement of automation,
stringent licensing for organized sector and price regulations to handle the shortages resulting
forms the licensing restrictions.
Restrictions of such nature only resulted in increasing costs, declining productivity and loss of
competitive edge. The textile industry had to be set free from these regulatory burdens so that it
could evolve, grow and remain competitive in the global market.
1.1 MFA Quota Removal and Indian Textile exports
Exports of garments from South Asian countries have been preponderantly
dependent on quotas. The quota system was fashioned by industrialized countries under the MFA
(Multi-Fiber Agreement) in 1974 as a temporary arrangement to protect their domestic garment
industries from the onslaught of cheap imports from low wage countries.
As a result of the quota restrictions, those Asian countries, which had used up their quota, started
establishing manufacturing platforms in other Asian countries, which were not in a position to
fully utilize the available quota. Quota arrangements under MFA terminated in a phased manner
by the end of the year 2004.
While vanishing of quota restrictions supposedly frees up the market for exporting countries to
export garments without any restrictions, there is a great deal of apprehension that the jobs and
incomes of a very large number of people in the garment industry would be in jeopardy when the
exporting countries, particularly with resource endowment, textile and clothing tradition and
efficient manufacturing base, jostle for market share. The world garment industry is on the
threshold of far reaching institutional changes in the near future. Hitherto, despite being one of
the most globalized industries in the world, it has also been an example of how trade
practices in a ‘globalizing’ world are still distorted in favor of advanced economies. Over the
past three to four decades, trade restrictions, price and quantitative, have come to play a major
role in conditioning patterns of the sector’s development.
The garment sector has been conventionally viewed as a major source of employment
generation. Of late, in addition to this dimension, following the success of the East Asian
39
economies low skill requirements and large labor absorption potential have made it an important
source of non-agrarian employment for the rural populace of these regions.
To add, the garment sector is also seen to offer tremendous prospects for employment of women,
unlike other traditional manufacturing sectors. Given these factors, it is of great importance to
understand the labor market implications of the changes in the international trade regime.

1.2 Overview of the Global Textile Market

“The end of the quota regime, which marks the phasing out of the MFA
from January 1, 2005, has ushered a new phase of l\global opportunity for the Textile & Clothing
Sector. The removal of quotas could witness the World Trade in Textile, which is at present US
$ 395 billion to surge to over US $ 650 billion by 2010. The expected future CAGR is expected
to be 8% with Textiles Accounting for 5.8% and Clothing being the real driver of growth with an
expected CAGR of

9.6%. Hence, there lies a distinct opportunities for countries possessing competitive advantages
resulting from labor, technology, and raw materials, rather than for those arising from favorable
trade agreements.
Diagram- 1.1 World Textile & Clothing Trade”1

40
1.5 Changing Shares in World Trade

World trade in textiles and clothing amounted to US $ 395 billion in 2003,

of which textiles accounted for 43% and clothing around 57%. Developed countries accounted
for little over one-third of world exports in textile and clothing in 2002 with developing
countries contributing to the remaining two-thirds. The scene was completely opposite in 1990
with the share of developed countries amounting to 52% and that of developing countries around
48%. In other words, in the period from

1990 to 2002, there has been a shift in worked textiles and clothing trade from developed to
developing countries.
Table-1.1

Percentage share in total world exports of Textile & clothing

% share in 1990 % share in 2002

World Exports 100.0 100.0

Developed Countries 52.2 37.8

Developing Countries 47.8 62.2

41
 Source: Computed from data available with International Textiles and clothing Bureau (ITCB),
Geneva

1.6 Share in World Trade by Region

The transition period, starting from 1995, has seen an increase in the share of Asia’s exports to
the world in textiles rather than clothing. The share of Asia in textile exports rose from 42.6% in
1995 to 44.3% in 2003, while its share in clothing exports has remained stagnant at around 44%.
Western Europe has seen a decline in share in both textile and clothing exports in the transition
period. On the other hand North American textile exports have risen from 5.7% in 1995 to 7.8%
in 2003 and fallen slightly I clothing exports, from 4.8% to 3.3% in 2003.

Table-1.2

Textile and Clothing Exports by Select Region (%)

Regions Textiles Clothing

Year 1995 2003 1995 2003

Asia 42.6 44.3 44.4 44.7

Western Europe 44.5 39.3 36.0 32.1

North America 5.7 7.8 4.8 3.3

Source: International Trade Statistics, 2004, WTO

42
 Trade in textile and clothing was dominated by the developed countries in
the MFA period with the European Union (15) accounting for about 49% of total textile exports
and 42% of clothing exports in 1980. EU, USA, Canada, Japan and Switzerland accounted for
69% of total textile exports in 1980. Developed countries dominance in clothing exports was
relatively less with USA and EU together accounting for around 45% of total exports in 1980.
However, developed countries share in both textiles and clothing exports declined in the 90s and
stood at around 47% and 28% respectively, in 2002.
The decline in the share of developed countries was driven by a sharp decline in the share of EU,
in both textile and clothing exports. Leading exports amongst the developing countries, as per
WTO categorization, on the other hand have increased their individual shares during the MFA
period, with China in the lead. Developing countries’ share in textile exports has increased from
17.3% in 1980 to 41.9% in 2003, while in clothing it has increased from 16.4% to almost 46.1%
during the same period. China has increased its share in textile exports from 4.6% in 1980 to
15.9% in 2003 and an increase from 4% to 23% in clothing exports during the same period.
However, while in textiles there has undoubtedly been a shift away from developing countries,
with gains accruing to MFA constrained countries, in clothing the gains have mainly accrued to
‘preferred’ developing countries. The countries that have gained share in clothing exports are the
ones who are a party to some kind of policy-induced preferential arrangement with the restricted
markets, viz., USA EU and Canada. Countries like Tunisia, Turkey, Mexico, Romania and
Dominican Republic are cases in point, since not only do these countries form a part of the
‘preferred’ group of exporters but also feature amongst the leading exporters of clothing.

1.7 Indian Textile Industry – Present Scenario

The Indian Textile Industry is a vertically integrated industry which
covers a large gamut of activities ranging from production of its own raw material namely,
cotton, jute, silk and wool to providing to the consumers high value added products such as
fabrics and garments. India also produces large varieties of synthetic and manmade fibers such as

Filament and spun yarns from polyester, viscose, nylon and acrylic which are used to
manufacture fabric and garments.
“The textile sector plays a significant role in Indian economy by contributing to the Gross
Domestic product, generating employment and earning foreign exchange. An estimated 35

43
million people are directly employed in the Indian Textile Industry, which contributes to 4% of
GDP and 21% of total export earnings.”4
India is globally a significant player in the textile sector and is globally the
 Third largest producer of cotton and cellulose fiber/yarn.

 Second largest producer of cotton yarn.

 Largest producer of jute, second largest producer of silk.

 Fifth largest producer of synthetic fiber/yarn.

“Cotton is one of the major corps cultivated in India. India has the largest
cotton acreage in the world and cotton is the dominant fiber in Indian Textile Industry. About
75% of the total yarn and about 56% of the total fabric produced in India was cotton in 2004-
05. Almost all cotton used in India is grown locally and a tiny amount is imported.
Cotton textiles account for 2/3rd of India’s textile exports”5
“During the last five decades, the production of cotton in India increased from 30 lakh bales of
170 kgs each in 1950-51 to an estimated

213 lakh bales (170 kg each) in 2004-05. There has also been a rise in area under cultivation
from 58.9 lakh hectares in 1950-51 to an estimated
89.7 lakh hectares in 2004-2004.”6

1.8 Process of Globalization

The characteristics of garment production like low sunk costs and relative
absence of advanced technology and skills, have always induced apparel firms in the advanced
capitalist countries to shift labor intensive operations to peripheral economies. Studies supportive
of the ‘New International Division of Labor’ hypothesis, in fact, view the process of
globalization as a movement from high wage cost region to low wage cost ones.

44
This process has its origins in the 1950s when manufacturers began to shift production to Japan
to take advantage of the lower wages prevailing there. This sourcing of garments from Japan
with still lower wage levels followed the earlier movement of US garment production from the
northern part of the country to the less unionized and lower waged southern regions.
Subsequent to the economic boom in Japan during this period accompanied by rise in wage rates,
manufacturers began to shift production to Hong Kong. From Hong Kong, capital migrated to
South Korea and Taiwan to tap the benefit from the lower wages prevalent in those economies.

45
 The period thus witnessed a trend towards movement of Japanese
apparel capital to offshore locations like neighboring South Korea. The 1980s witnessed the
incorporation of other Asian countries with relatively low wage levels like China, Thailand,
Indonesia, Sri Lanka, Pakistan, India and Bangladesh into the world garment trade. Between
1975 and 1990, the share of ‘third world’ in the total output of global textiles has increased
from 18.6 percent to 26.1 percent, and that of clothing from
11.7 percent to 20.4 percent.

On the other hand, garment sector has become a growth pole for
economies at lower levels of development like Bangladesh, China, Sri Lanka, Indonesia, India
and Thailand.
As the leading sector of globalization, the garment industry continues to increase its share in
world trade for manufactured commodities. World garment trade has in fact grown faster than
trade in manufactured good as a whole. Accompanying this global expansion, there have also
been changes in the organization of production with important implications for garment
production in peripheral economies.

P a g e | 46
 COMPANY PROFILE

P a g e | 47
 COMPANY PROFILE

ABOUT SRI SIVAM KNIT WEAR

The S. Kumar’s Group is an Indian conglomerate with interests in textiles,

apparels, energy, e-commerce, ITES, leisure and retailing sectors. The flagship company
of the group, S.Kumar’s Nationwide limited or SKNL manufactures and markets the
famous SRI SIVAM KNIT WEAR brand in India. SKNL was formerly known as S.
Kumar’s Syngas Ltd. History he S. Kumar’s Group was established in 1948 by
Abhayakumar Kasliwal and Shambhukumar Kasliwal, who built a textile distribution
network, and followed it with textile manufacturing.

On 28 September 1990, S Kumar’s was incorporated as a private limited

company, and became a deemed Public Company with effect from 28 February 1991. It
became a Public Company on 7 July 1992.

The company then transformed to SKNL (S. kumars Nationwide Limited). SKNL
is one of India’s leading textile and apparel company with expertise in multi-fiber
manufacturing. The company has extended its presence in multiple product categories
from Fabrics to Apparels and Home Textiles.

Brands and subsidiaries

Textiles and apparel

S. Kumar’s has set up a texturizing and twisting plant at Pithampur in Madhya Pradesh.
In 1997, S. Kumar’s acquired a spinning-cum-weaving unit near Dewas (Madhya
Pradesh), from Standard Industries Limited.

In 1998, S. Kumar’s entered into a collaboration with SRI SIVAM KNIT WEAR
of Scotland for manufacturing and marketing the SRI SIVAM KNIT WEAR worsted
suiting in India. In 2006, SKNL launched "Carmichael House", a complete range of home
linen products and accessories.

P a g e | 48
In 2006, SKNL launched "Belmonte", a youth menswear brand that had both fabric and
ready-to-wear garments under one label. It claims to be India's only youth brand to offer
"Total Wardrobe Solutions" - Fabric, Apparel and accessories.

In 2007, the prestige clothing brand Stephens Brothers was licensed to SKNL in India. It
was launched in December 2007, to introduce the English cut & style to Indian consumer.
The brand is now owned by the UK Group Austin Reed.

Other sectors

In 1988, S. Kumar’s established a two-wheeler tires and tubes manufacturing facility at

Pithampur in Madhya Pradesh. It also entered into an alliance with Apollo Tires, for
marketing and growth.

The Maheshwar Hydro Electric Project, located at Mandleshwar in Madhya Pradesh was

awarded to S. Kumar’s Group in 2001, on "build, own and operate" basis. However this
project is still to be completed. The project became controversial due to non-payment on
various occasions by S. Kumar’s.

Landmark Leisure Corporation Limited was established as S. Kumar’s' leisure and

entertainment business arm. It was originally found to set up a chain of family
entertainment centers across India, the first two being launched in World (Mumbai)
and Indore. In 2001, S. Kumar’s launched S-MAART, a department store in Landmark
Citi, World. In 2002, Landmark Leisure Corporation decided to develop its leisure brand
under two entities: Landmark (family entertainment centers) and Mikonos (nightclubs).

S. Kumar’s Online Ltd. (SKOL) was set up as the e-commerce arm of the S. Kumar’s
Group, while Indus Infotech Ltd. was set up as its ITESarm.

In 2009, Company has acquired assets of Hartmarx Corporation, a well-known company

in American and European markets.

Organization

SKNL businesses are divided into product-specific Strategic Business Units (SBUs):
Consumer Textiles, Home Textiles, Worsted Suiting’s, Ready to Wear and High Value
Fine Cotton (HVFC). Each of these SBUs is headed by an Executive Director, Chief

P a g e | 49
Executive Officer, or a Chief Operating Officer. The corporate activities related to
finance, planning, research, publicity, marketing, human resources etc. are centralized.

Consumer Textiles

 Belmonte (Fabrics)
 Uniformity by Belmonte (Uniform fabric)
 S.Kumars (Work wear fabric)
Home Textiles

 Carmichael House (Premium)

 Benetton ( Super Premium)
Ready to Wear (TWS)

 Belmonte (Mid-Premium)
Baruche Superfine Cottons

 To be launched

SRI SIVAM KNIT WEAR (India) Limited

S. Kumar’s acquired rights for manufacturing and marketing the SRI SIVAM KNIT
WEAR worsted suiting in India in 1998. SRI SIVAM KNIT WEAR was originally
started by a Scottish man named Alexander Reid in the 1830s. The concern, financed by
Joseph Taylor, went on to become a notable worsted suiting brand. S. Kumar’s set up a
luxury suiting plant at  in 1998 for SRI SIVAM KNIT WEAR (India) Ltd. The brand has
been endorsed by India's notable film actor, Amitabh Bachchan. In 2008, 24.5% stake in
SRI SIVAM KNIT WEAR was acquired by an affiliate of GIC Special Investments for
Rs 900 crore.

Luxury Textiles
SRI SIVAM KNIT WEAR (Luxury Suiting’s)
Ready to Wear

 SRI SIVAM KNIT WEAR ( Premium)

 Stephens Brothers ( Super Premium)

P a g e | 50
 SRI SIVAM KNIT WEAR s not only successful in being one of the top most textile
manufacturer in India, but is also grooming in respect of employee perception &
engagement & growth.
The areas which are being focused in terms of Employee perception &
engagement are:

 Growth
 Stagnation
 Stress/Workload/Team Engagement
 Communication
 Appreciation

Employee perception & engagement

A positive attitude held by the employee towards the organization and its values.
An engaged employee works with colleagues to improve performance within the job for
the benefit of the organization. The organization must work to develop and nurture
engagement, which requires a two-way relationship between employer and employee.

Employee perception & engagement is a partnership between a company and its

employees

Most organizations today realize that a satisfied employee is not necessarily the
best employee in terms of loyalty and productivity. It is only an ENGAGED
EMPLOYEE who is intellectually and emotionally bound with the organization who
feels passionate about its goals and is committed towards its values thus he goes the extra
mile beyond the basic job. Employee perception & engagement is a powerful retention
strategy. An engaged employee gives his company his 100 percent. When employees are
effectively and positively engaged with their organization, they form an emotional
connection with the company. Employee perception & engagement is a barometer that

P a g e | 51
determines the association of a person with the organization. It is about creating the
passion among associates to do things beyond what is expected from him.

EMPLOYEE ENGEGEMENT starts right at the selection stage:

 Choosing the right fit, giving a realistic job preview

 Strong induction and orientation programmer
 To keep up the morale of people and drive them towards excellent performance
through recognition letters, profit sharing schemes, long performance awards etc.
 Regular feedback to all people
 Communication forums like the in-house magazine, and regular surveys and
conferences
 By helping to maintain the quality of work-life and a balance between
personal/professional lives, there are recreational activities like festivities, get-
togethers, sports etc.
 An open and transparent culture to empower its people.

The result of these practices can be evident through the regular feedback from our
employees collected through surveys,

Diagnostic tool for employee perception & engagement include the following

- Training
- Development
- Career
- Performance Appraisals
- Performance Management
- Communication

P a g e | 52
 - equal opportunity
- fair treatment
- pay
- benefits
- health
- safety
- cooperation
- family orientation
- friendliness
- job satisfaction

which helps to create - feeling valued and involved which is

- engagement.

Factors for Higher Employee perception & engagement

Here is a list of some contributing factors:

 Understanding of corporate goals/mission

 Understanding of job and how it contributes to overall corporate goals
 Clear communication of goals, expectations, directions
 Job design
 Job fit
 Support and tools
 Independence & innovation
 Relationship with boss/direct reports
 Clear feedback on performance
 Recognition
 Learning and development opportunities
 Opportunities for advancement
 Pride in organization

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  Employee input
 Employee involvement in decision making
 Work-life balance
 Workplace culture/morale
 Co-worker relationships/good team environment (enjoy colleagues)
 Fair HR practices

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 Measuring the Impact of Employee perception & engagement

SOME USEFUL COMPANY ENGAGEMENT PROGRAMS COULD

INCLUDE
 A daily column, written by Directors, Chairman, on the intranet with company
announcements / programs etc.
 Online real-time tracking of progress. Employees can view company progress
towards targets / goals.
 Provide long term strategic vision for business growth.
 Employee suggestion systems / quick responses.
 Weekly blog related to serious business issues and staff to read / comments.

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Questions to Measure Employee perception & engagement

 Do you know what is expected of you at work?

 Do you have the materials and equipment you need to do your work right?
 At work, do you have the opportunity to do what you do best every day?
 In the last seven days, have you received recognition or praise for doing good
work?
 Does your supervisor, or someone at work, seem to care about you as a person?
 Is there someone at work who encourages your development?
 At work, do your opinions seem to count?
 Does the mission/purpose of your company make you feel your job is important?
 Are your associates (fellow employees) committed to doing quality work?
 Do you have a best friend at work?
 In the last six months, has someone at work talked to you about your progress?
 In the last year, have you had opportunities at work to learn and grow?

We can also have a HR folder or an intranet for employees have you have sections like
motivation stories, quotes, Support grievances jokes, etc... Some entertainment for
employees.
KEY EMPLOYEE PERCEPTION & ENGAGEMENT OUTCOME METRICS

-EMPLOYEE RETENTION
-COMPANY
PERFORMANCE
-CUSTOMER
SATISFACTION
- PROFITABILITY

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ACTIVITIES WHICH ARE HELD IN SRI SIVAM KNIT WEAR

1. Education @ Work
2. Redesign work place
3. Letters to Family
4. Fun @ work
5. Cross Training
6. Team Huddles
7. FLA Growth Card
8. Life Enrichment Activities
9. Job Rotation
10. Clubs/Projects
11. Active Team Leader

Education at Work
Education at Work Prepares employees for success by offering relevant programs
from premier institutes across the world, using multiple delivery methodologies and
making it convenient for employees to ‘Learn while you Earn’ and helping to build career
and helps in contributing to the organization’s growth.
Programs that are offered by Education at work are:
1. Banking
2. Finance and Accounting
3. Language
4. Management
5. Risk Management
6. Supply Chain Management
7. Information Technology
8. Project Management\
9. Customer Service
10. Mortgage

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 11. Insurance
12. Analytics
13. Software
14. Collections

Revamping the Floor: - Action plan was made to Revamp the floor by

Following Activities:

1. Change Wall Color-

 Wall Painting-Beaches, Poster on work motivation is done.

1. Improving Ambience-

 Plants on the floor-Money Plants, Bamboos

 Danglers-Mortgage Danglers
 Games Area- Dart Board, Carom, Chess, Boxing Bag, Ludo, Chinese checker
 Light music on the floor.
 Improve Lighting on the floor-Through Lamps.

2. Redesigning Work Station –

 Personalizing Work Space- Individual Sections, Family Photos, Mementoes

 Making work place special. Customizing it, basis imagination of employees.
Letters to Family: It was also part of Action plan in Mortgage.

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As per this plan in SRI SIVAM KNIT WEAR- Personalized letters were to be sent to the
families of all employees for the following:

 Birthday card with a photograph of the B’day Celebration at office.

 Promotion letter informing the family about the promotion of the employee
 Connect invite letters to the family members to visit SRI SIVAM KNIT WEAR
any day of their choice.
 Fun at Work

Fun at Work activities are considered to be backbone in a team bounding. Every

team has a fun spec whose responsibilities includes various games and other team
building activities with the help of which internal team bounding can be improved. At the
same time it can also be considered to provide ample of time as to relieve the stress that a
normal employee has to face.

Different activities include various indoor games, Seasonal activities celebrating

festivals, Bay decoration, and Birthday celebration.
Fun at Work" might sound like an oxymoron, but it is a reality in the corporate world
today. The most successful of organizations add a healthy dose of play into their
routines because research shows that when people have fun at work, they enjoy their
jobs and this translates them into being more creative, more productive and more
committed to doing their job well.

It’s also no secret that having fun at work can help boost morale, reduce stress,
improve staff retention, mean less sick days and increase team building and spirit.

Having true fun at work is very similar to the kind of fun one has when playing a
sport or performing. For example, the last time I played a sport in front of an audience, I
channeled all my attention and energy to the point where I was solely focused on my
performance. I remember how much fun it was getting congratulations from my

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teammates and the audience! And even though I was completely exhausted following my
performance, I remember how great I felt afterwards.

I think this is the type of fun that best fits the workplace - playful and competitive games
that generate congratulations and cheers from coworkers. Additionally, sporting or
performance types of fun fit well within the workplace where employers generally want
us to have energy, drive, talent, determination, competitive spirit, and be goal orientated.

This kind of fun is successfully being implemented at SRI SIVAM KNIT WEAR. We’ve
already had a Football Championship which involved a lot of employees. Emotions were
shared and the teams really had intensive fun. Now SRI SIVAM KNIT WEAR has its
own football team, who represents the company at the biggest football tournament
dedicated to all companies.

Cross Training :

Cross-training (Also known as conditioning) refers to training in different ways to

improve overall performance. It takes advantage of the particular effectiveness of each
training method, while at the same time attempting to neglect the shortcomings of that
method by combining it with other methods that address its weaknesses.

Cross-training in business operations involves training employees to engage in quality

control measures. Employees are trained in tangent job functions to increase oversight in
ways that are impossible through management interactions with workers alone.

Advantages:
 Helps patrons/customers/clients in the long run, as employees are empowered to answer
questions about the entire organization.
 Requires staff to re-evaluate the reasons and methods for accomplishing their work;
inefficient methods, outdated techniques and bureaucratic drift are challenged, if not
eliminated.

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  Raises an awareness of what other departments do.
 Routine scheduling is enhanced with the ability to move staff about the "Operation".
 Better coverage, increased flexibility and ability to cope with unexpected absences,
emergencies, illness, etc.
 Can increase the "employability" of staff that has the opportunity to train in areas they
were not originally hired for.
 Other advantages include Increased flexibility and versatility, Appreciated "intellectual
capital" Improved individual efficiency, Increased standardization of jobs, Heightened
Morale

Team Huddle:

A huddle is when a team gathers together, usually in a tight circle, to strategies,

motivate, and/or celebrate. It is a popular strategy for keeping opponents insulated from
sensitive information, and acts as a form of insulation when the level of noise in the
venue is such that normal on-field communication is difficult. Commonly the leader of
the huddle is the team captain and it is the captain who will try and inspire his fellow
team members to achieve success. Similarly after an event a huddle may take place to
congratulate one another for the team’s success (or commiserate a defeat). The term
"huddle" can be used as a verb as in "huddling up".

FLA Growth Card:

Goal sheets for each team member created, which is monitored on a daily basis.
The result of the goal sheet decides the cheer winner for the month. The categories on
which the FLA’s are assessed are:

1. Performance Related It includes:

 AES Score
 Cross Training Effectiveness
 Process Knowledge Scor

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 2. Compliance:
It Includes:

 Process Compliance Adherence

 Data Protection Act Adherence
 Dress Code Policy adherence

3. Quality/Six Sigma: It includes

 Lean ideas Filed

 E2E Ideas generated

 Job Rotation: Change in roles and responsibilities, like SME,QC, Dashboard, IT,
HR, Quality, Logistics.

Life Enrichment Activities: Though life enrichment activities stress and health
of the Employees can be taken care of.

It includes:
 Introduction of Yoga
 De-Stress Activities
 Office Ergonomics

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 RESEARCH
METHODOLOGY

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RESEARCH METHODOLOGY

The research method of the study explains the systematic way of findings to the
predetermined objectives. Moreover this provides the clean path to accomplish and
achieve clear solution for the problem stated. The following are the stages through which
the research has passed to obtain the conclusions.
1. Define the research problem
2. Review the literature
3. Design research
4. Collection of data
5. Analyze data
6. Interpret data
7. Report the data

Statement of the Problem:

SRI SIVAM KNIT WEAR is a well-known, established Multi National Company

with rich Heritage of GE. Having a history of about 70 years SRI SIVAM KNIT WEAR
is carrying a great Brand Image. Recently SRI SIVAM KNIT WEAR is awarded as
world No 2 Best manufacturer and “Best Employer choice to Work” for. As it is said
People make or break organizations, a study is done at SRI SIVAM KNIT WEAR to
know the Employee perception & engagement practices at such an organization.

In this study emphasis is given to know the Employees Opinion, who are working
with SRI SIVAM KNIT WEAR, and to know how far the Employee perception &
engagement at SRI SIVAM KNIT WEAR are useful.

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Purpose and Importance of the study.
The answers from the Employees will give the true picture of the Employee
perception & engagement . Analyzing the candidates answers will help in understanding
problems from the Employees view, thus will help to develop the current system and
making it more effective.

Objectives of the Project:

 To Study the Employee perception & engagement practices in a

well-established MNC.
 To evaluate the effectiveness of the Employee perception &
engagement .
 To find out the satisfaction levels of the Employees with the current
system.

Methodology:

A study is conducted to know the views of the Employees on the Current System.
To know the attitude of the Employees data is collected through structured questionnaire.
(Where questions are in pre-arranged order).
The questionnaire consists dichromatic, multiple choice and open ended
questions.
The questionnaire is designed for Employees working with SRI SIVAM KNIT
WEAR; the questionnaires were given as feedback forms to the candidates on behalf of
SRI SIVAM KNIT WEAR.

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LIMITATIONS OF THE STUDY

1. There was a time restriction of 45 days, so the study was conducted by selecting a
sample of 15 respondents and the facts and findings may not represent a true picture of
the procedure followed in organization

SCOPE OF THE STUDY

1. Only the Employee perception & engagement is considered.

2. The study is conducted at SRI SIVAM KNIT WEAR, TIRUPUR with a simple
sample size of only 15 employees.

3. In order to analyze the study the questionnaire has been administered to the
Employees.

Sample Selection: As the objective of the project is to study the Employee

perception & engagement to know the perception of the Employees, sample is selected
based profiles.

Sampling Size: A sample size of 15 is drawn, where the respondents are the Employees.

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Source of data:
For the purpose of the study the following sources of data are used.
Primary data: Primary data refers to the collection of first hand data.

Data is collected through

 Questionnaire
 Observations
Questionnaire: Questionnaire is prepared and circulated to the employees to know their
opinion.
Observations: Observations were done during the visits to the organization.

Secondary data:
Secondary data refers to the data, which is not newly generated but rather obtained
from.
 Published sources.
 Unpolished sources i.e., information about the performance of the company
 Report on the study.
 Review of literature etc.

Data Analysis: After the data have been collected it has to be analyzed; the data obtained
from the questionnaire is arranged in a serial order. A master copy with tabulation
methods has been prepared.
Tabulation is a part of technical procedure where in classified data are
put in the form of tablets. The tablets thus obtained were analyzed with statistical
techniques so that interpretation would be precise.

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ORGANISATION OF THE STUDY

Organization of the study deals with the arrangement of the entire report. The entire work
is put according to chapter wise to facilitate easy identification of the topic.
1) The chapter I. gives the introduction of Employee perception &
engagement . This chapter gives overall view of the project.

2) The chapter II deals with Industry profile, company profile and

procedures followed in organization.

3) The chapter III deals with introduction of Employee perception &

engagement and Employee perception & engagement Practices done in SRI SIVAM
KNIT WEAR.
.
4) The chapter IV deals with Research methodology used , statement of
the problem , objectives , sample collection and statistical tools used .

5) The Chapter V data analysis and interpretation, which explains how

data is analyzed and interpreted by using tables, graphs.

6) The chapter VI deals with conclusions.

7) The end of the report consists of Bibliography, which is followed by

Annexure.

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1. Does Fun at work happen regularly?

4
Series1
3

0
Strongly Disagree Slightly Agree Strongly No Opinion
Disagree Disagree Agree

Purpose: Main purpose of asking this question was to see that fun at work activity
happens regularly in the team or not.

Conclusion: Most of the believe that it happens regularly in the team.

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2. Do I get Feedback regularly from my supervisor for improving my performance?

4 Series1

0
Strongly Disagree Slightly Agree Strongly No opinion
Disagree Disagree Agree

Purpose: The purpose of asking this question was to see whether the supervisor is
providing feedback to the employees regarding his performance or not.

Conclusion: Approximately half of the people strongly agree with this statement however
there are few who disagree with this statement.

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3. Do I feel like coming to office regularly?

4
Series1
3

0
Strongly Disagree Slightly Agree Strongly No Opinion
Disagree Disagree Agree

Purpose: Purpose of asking this question was to see that how many people are interested
in doing their work.

Conclusion: Most of the Employees want to come to office regularly except few
employees.

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4. Do I get sufficient opportunities to improve my skills?

4 Series1

0
Strongly Disagree Slightly Agree Strongly No opinion
Disagree Disagree Agree

Purpose: Purpose of asking this question was to see that how many employees think that
they are given equal opportunities to improve their skills.

Conclusion: There is no employee who disagrees with this statement. There are few
employees who slightly disagree with this statement.

Most of the employees think that they get equal opportunities.

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5. Do I receive any recognition for my contributions in last 3 months?

4
Series1
3

0
Strongly Disagree Slightly Agree Strongly No opinion
Disagree Disagree Agree

Purpose: The purpose to ask this question was to see that how many employees think that
rewards and recognition is given to them for their work.

Conclusion: Half of the employees think that they get rewards and recognition and half of
the employees disagrees, strongly disagree and slightly disagree with this statement.

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6. Are my thoughts and feelings given due respect at work place?

8
7

6
5
4 Series1
3

2
1
0
Strongly Disagree Slightly Agree Strongly No Opinion
Disagree Disagree Agree

Purpose: Purpose of asking this question was to see that the thoughts of employees are
given respect or not

Conclusion: Employees feel that their thoughts are given respect and their thoughts are
given values.

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7. Does my manager demonstrate a personal commitment to my continuous learning and
development?

3 Series1

0
Strongly Disagree Slightly Agree Strongly No Opinion
Disagree Disagree Agree

Purpose: Purpose of asking this question was to see that how much commitment is shown
by the supervisor for the development of the employee.

Conclusion: More than half of the employees think that the manager shows commitment
towards there development.

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8. Do I get encouraged to learn from my mistakes?

3 Series1

0
Strongly Disagree Slightly Agree Strongly No Opinion
Disagree Disagree Agree

Purpose: Purpose was to see that do the employees get the opportunity to learn from there
mistake.

Conclusion: Most of employees think that they get opportunities to learn from their
mistakes.

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9. Do I enjoy my work?

4
Series1
3

0
Strongly Disagree Slightly Agree Strongly No opinion
Disagree Disagree Agree

Purpose: Purpose was to see that employees enjoy their work or not.

Conclusion: Most of the employees enjoy their work.

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 10. Am I aware of the career opportunities that are available to me at my company?

4
Series1
3

0
Strongly Disagree Slightly Agree Strongly No opinion
Disagree Disagree Agree

Purpose: Purpose was to see the awareness of the employees about their career
opportunities.

Conclusion: Most of the Employees are aware of the career opportunities in SRI SIVAM
KNIT WEAR.

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CONCLUSION

Conclusion
As Per the above observations and analysis it seems that most of the Employees of GCF
Australia are Engaged and like there work and Organization except few Employees who
are Not Engaged and few who are Nearly engaged and can be changed to an Engaged
Employee by their supervisors by proper planning.
Employee perception & engagement is the buzz word term for employee communication.
It is a positive attitude held by the employees towards the organization and its values. It is
rapidly gaining popularity, use and importance in the workplace and impacts
Organizations in many ways.
Employee perception & engagement emphasizes the importance of employee
communication on the success of a business. An organization should thus recognize
employees, more than any other variable, as powerful contributors to a company's
competitive position. Therefore employee perception & engagement should be a
continuous process of learning, improvement, measurement and action.
We would hence conclude that raising and maintaining employee perception &
engagement lies in the hands of an organization and requires a perfect blend of time,
effort, commitment and investment to craft a successful endeavor.

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Questionnaire

Employee perception & engagement Survey

1. Does Fun at work happen regularly?

A. Strongly Disagree
B. Disagree
C. Slightly Disagree
D. Agree
E. Strongly Agree
F. No Opinion

2. Do I get Feedback regularly from my supervisor for improving my performance?

A. Strongly Disagree
B. Disagree
C. Slightly Disagree
D. Agree
E. Strongly Agree
F. No Opinion

3. Do I feel like coming to office regularly?

A. Strongly Disagree
B. Disagree

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 C. Slightly Disagree
D. Agree
E. Strongly Agree
F. No Opinion

4. Do I get sufficient opportunities to improve my skills?

A. Strongly Disagree
B. Disagree
C. Slightly Disagree
D. Agree
E. Strongly Agree
F. No Opinion

5. Do I receive any recognition for my contributions in last 3 months?

A. Strongly Disagree
B. Disagree
C. Slightly Disagree
D. Agree
E. Strongly Agree
F. No Opinion

6. Are my thoughts and feelings given due respect at work place?

A. Strongly Disagree
B. Disagree
C. Slightly Disagree
D. Agree
E. Strongly Agree

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 F. No Opinion

7. Does my manager demonstrate a personal commitment to my continuous learning

and development?

A. Strongly Disagree
B. Disagree
C. Slightly Disagree
D. Agree
E. Strongly Agree
F. No Opinion

8. Do I get encouraged to learn from my mistakes?

A. Strongly Disagree
B. Disagree
C. Slightly Disagree
D. Agree
E. Strongly Agree
F. No Opinion

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 9. Do I enjoy my work?

A. Strongly Disagree
B. Disagree
C. Slightly Disagree
D. Agree
E. Strongly Agree
F. No Opinion

10. Am I aware of the career opportunities that are available to me at my company?

A. Strongly Disagree
B. Disagree
C. Slightly Disagree
D. Agree
E. Strongly Agree
F. No Opinion

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 BIBLIOGRAPHY

Books referred:
 Human Resource Management…………………………..Shashi. K. Gupta
 Rosy Joshi

 Human Resource Management………………………….V.S.P.Rao

 Human Resource Management………………………….Fisher Shaw

 Human Resource Management………………………….Scuba Rao

.
Websites:

www.humanresources.about.com

www.hr-guide.com

www.books.google.com

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