Report on

Organisation Study on Federal Mogul Goetze India Ltd.,

18MBAOS307
By
Kavya R
1AY18MBA18
Submitted to

VISVESVARAYA TECHNOLOGICAL UNIVERSITY, BELAGAVI

In partial fulfilment of the requirements for the award of the degree of

MASTER OF BUSINESS ADMINISTRATION
Under the guidance of

INTERNAL GUIDE EXTERNAL GUIDE

Dr. Renuka Devi Mr. Nagaraj Hatti
Associate prof. MBA department Asst HR Manager
Acharya Institute of Technology Federal Mogul

Acharya Institute of technology

Department of MBA
Soladevanahalli,
Hesaragatta Main Road, Bengaluru
August 2019
 CERTIFICATE

This is to certify that Kavya R bearing USN 1AY18MBA18, is a bona-fide

student of Master of Business Administration program of the Institute affiliated to
Visvesvaraya Technological University, Belagavi. Organisation report on Federal
Mogul Geotze India Ltd is prepared by Him/her under the guidance of Dr.
Renuka Devi, in partial fulfillment of the requirements for the award of the degree
of Master of Business Administration of Visvesvaraya Technological University,
Belagavi Karnataka.

Signature of Internal Guide Signature of HOD Signature of Principal

 DECLARATION

I, Kavya R, hereby declare that the organisation report with reference to “Federal
Mogul Geotze Yelahanka” prepared by me under the guidance of Dr. Renuka Devi,
associate professor of M.B.A Department, Acharya Institute of Technology and
external guidance by Mr. Nagaraj Hatti, Asst. HR Manager. I also declare that
organisation is towards the partial fulfilment of the university regulations for the
award of degree of Master of Business Administration by Visvesvaraya
Technological University, Belagavi. I have undergone an organisation study for a
period of four weeks.

Place: Signature of the student

Date:
 ACKNOWLEDGEMENT

I would like to thank my people who have helped and supported me while doing my

organisation study and work.

There is not enough word to offer vote of thanks to Dr. M.M.Bagali, Head of the

Department of MBA, AIT Bengaluru for his help in initiating the project report in

advance for the regular motivation, my guides Nagaraj Hatti, Asst. HR manager at

Federal Mogul and Dr. Renuka Devi Associate Professor of MBA Department, AIT

Bengaluru for their admirable help, suggestions and opinions on the contribution during

and after the internship period.

Thanks a lot appreciation to helping nature of employees at Federal Mogul for their
supports.

Place: Bengaluru Kavya R

Date: USN: 1AY18MBA18
 TABLE OF CONTENTS

Chapter Titles Page

No Number
1 Introduction

1.1 Introduction about organisation study 1

1.2 Objectives of the study 2

1.3 Industry Profile 3

2 Organization profile

2.1 Company Background 7

2.2 Nature of Business 10

2.3 Vision, Mission and Quality Policy 11

2.4 Product / Service profile 12

2.5 Ownership pattern 20

2.6 Achievements/awards 21

2.7 Future growth and prospects 22

2.8 Organization structure 23

3 McKinsey 7S Framework

3.1 McKinsey 7S Framework – Introduction 24

3.2 McKinsey 7S Framework with reference to company 26

4 SWOT Analysis

4.1 SWOT Analysis – Introduction 30

4.2 SWOT Analysis with reference to company 31

5 Financial Information

5.1 Analysis of Financial statements 32

6 Learning Experience

6.1 Learning Experience 39

6.2 Suggestions 40

Acharya institute of technology [Type here] [Type here]

 6.3 Bibliography 41

6.4 Annexure 42

Acharya institute of technology [Type here] [Type here]

 LIST OF TABLES

Table Title of the table Page no

No

5.3 Current ratio table 32

5.4 Quick ratio table 34

5.5 Return on assets table 36

5.6 Expense ratio table 37

LIST OF CHARTS

Graph Title of the charts Page no

No

2.1 Distribution chart in India 6

2.4 Piston chart 12

2.4 Safety equipment chart 15

2.4 Piston ring chart 15

2.4 Pins chart 18

3.1 McKinsey 7’s framework chart 24

5.3 Current ratio chart 33

5.4 Quick ratio chart 35

Acharya institute of technology [Type here] [Type here]

 5.5 Return on assets chart 36

5.6 Expense ratio chart 38

6.4 Profit & Loss account 42

6.4 Balance sheet 44

Acharya institute of technology [Type here] [Type here]

ORGANIZATION STUDY

CHAPTER 1

1.1 Introduction About The Organisation Study

Organisation report is designed to provide a chance to the student to get a work experience
with an opportunity to share their insights and personal development. This is an opportunity
which is provided by an employee for fixed period of time usually for one week to twelve
weeks. Anan internship may be full-time or part-time. A major component of this experience
is to create a professional attitude in the students and develop team by giving a challenging
situation in the real world. Through the internship program students can gain various
knowledge and skills such as communication skill, interpersonal skill, technical skill, problem
solving skill. Thus it helps in exploring future career development.
What is Internship?
An internship is an opportunity offered by an employer both in the non-profit and profit
sectors, to the student’s interested in the industry, an intern work there for fixed period of
time.
Who are Interns?

An intern is usually university students or university graduates who select the company for the
study purpose and hand-on-experience from conducting a project work in the organization as a
part of curriculum
Why an Internship is done?

An internship is a great opportunity for the students to gain not only work experience but also
helps to develop their career through getting work experience in a particular field.

1.2 OBJECTIVE OF ORGANISATIONAL STUDY

 To study the profile of Federal Mogul
 To analyse the various functions
 To make a SWOT analysis
 To make financial analysis
 To relate theory with practice

Acharya institute of technology [Type here] [Type here]

ORGANIZATION STUDY

METHODOLOGY OF THE STUDY

 Both primary and secondary data is collected from federal mogul
 Primary data is collected through direct conversation with the employees at various levels.
 Secondary data is obtained from company manuals especially quality manuals, company
website and other magazines and news papers
 Direct observation is used to understand the production process.

PERIOD OF THE STUDY

To study was held from 05/07/2019-05/08/2019

LIMITATIONS OF THE STUDY

 The findings need not be conclusive but only indicative.
 The study is limited to Bengaluru (Yelahanka) region only, it may not be useful for
other regions.
 The study is conducted for the period of four weeks. It is possible that the information
may not be very effective
 The study is limited to my experience and knowledge
ORGANIZATION STUDY

1.3 INDUSTY PROFILE

1.3.a Global Auto-Components

The global auto components industry has growing significantly in the last few years and it’s
expected to grow further due to globalization of the product. The industry is extremely
diversified sector that includes engine parts, power-train components HVAC systems, steering
system, electric and electronic components, hydraulic components, suspension systems,
sensors, lighting systems, chassis and aggregates and so on. This is boosting automotive
industry in a big way by incorporating cutting edge technology with cost advantage. This
helps in the manufacturing components by export in particular geographic location and uses
those components across the global. The auto component manufactures including after-market
parts manufacturers, retailers, dealers and suppliers as well. The global auto component
industry experienced evolution over last five years that is approximately $730.8billion in 2017
with a CAGR 3.2% over next five years. Strong growth in the industry has attracted number
of companies which include major foreign companies to operate in China’s auto component
market. The growing importance of electronic and functional combining of green components
and sustainable products will drive growth in the industry. These company has to serve in this
competitive world where they have deal with competitive price, expanding product portfolio
are the biggest challenges for the industry.

1.3.b Indian Automobile Industry

In Indian auto-motive industry is one of the largest in world with the annual production of
23.96million vehicles in 2015-2016. There is a growth of 2.57% over the last year. There is a
continuous development we can see in the sales during 2016. It also contributes 7% to the
country’s GDP and expected to grow to 12%. Thus, the automobile industry contributes on
Gross Domestic product that helps to develop the countries revenue, increase standard of
living, and better purchasing power and so on.
The manufacturing industries in India are divided into three clusters.
ORGANIZATION STUDY

Firstly, Chennai is the southernmost and largest with 35% of revenue share, secondly near
Mumbai, Maharashtra along the Chakan corridor near Pune is the western cluster with a 33%
of share in the market. Third is northern cluster is around the national capital region and
contributes 32% of revenue.

1.3.c Government Initiatives

The government encouraging the auto components industry by giving a 100% support through
foreign direct investment. Making of auto and auto components was started as a part of Make
in India in order to support the industry. The government of India plans to start fuel-efficiency
rating in order to encourage the sales of car. The automotive plan aim is to doubling the
contribution of automotive sector in GDP through exports.

1.3.d Future Growth and Perspective

The Indian auto components industry has experienced nonstop growth from past few years
that contribute to overall industrial development. It is expected to grow by 8-10 percent in the
FY 2017-18. This is based on several factors such as increasing population, creation of
demand for the product, significant investment in infrastructure, using innovative technology,
support from the government, huge domestic market, increasing purchasing power which
creates a good demand for the industry product. Thus, there is vast opportunity for the
industry.
ORGANIZATION STUDY

CHAPTER 2

COMPANY PROFILE:

FEDERAL MOGUL GOETZE (INDIA) Limited, formally known as M/S ESCORTS

LIMITED is established in 1954 by late Mr. Yudi Nanda, brother of Mr. HP. Nanda as joint
venture with Goetz – Werek of Germany. The Company was established as a trading concern
dealing with Tractor and form equipment slowly but, steadily it began to expand and diversify
to various production units.

FEDERAL MOGUL GOETZE (INDIA) Limited is the largest manufacture of Pistons and
Piston Rings, globally and has much cutting-edge technology in the field of Piston Ring.
The company has number of plants, marketing offices spread all over the Country. The
production plant is set up at Faridabad, Bengaluru and Surajpur.
The Production of M/S ESCORTS are Tractors, Motor Cycle, Earth moving equipment,
Telecommunication system, Shock absorber, Railway equipment, Automobile parts and
Electrical equipment

The Company caters to both OE (Original Equipment) and RM (Replacement Market)

segment to Automotive Industry. The Company has modern Manufacturing facilities at
Bengaluru and Patiala with the Head Office Marketing and Material function at New Delhi.
The Company has highly Motivated, Vibrant, and Talented Employees who contribute
handsomely to Growth of the Company.

Mr.Yudi Nanda and Mr. H.P. Nanda founded the Escort Group. The Company had setup its
first unit at Patiala and Started Commercial Production in 1957. The Company started
Manufacturing Unit at Bengaluru in 1977. Mr. M.R Swami, a close Associate of Nanda
hailing from T.Narsipura Hassan District was able Convince the Government of Karnataka to
set up the Plant at Yelahanka, Bengaluru. The Plant has coverage of 60 acres of Land.
ORGANIZATION STUDY

Presently there are two Plants namely.

[GOETZE INDIA Limited – Piston and Piston Pins Division and Piston Rings
Division] [GOETZE INDIA Limited – Steel Rings TP stands for Tikoku Piston]
ORGANIZATION STUDY

2.1 BACKGROUND:

In the year 1994 Sri Hariprasad Nanda and his brother Sri Yudi Nanda started ‘ESCORTS’ at
Lahore. During 1947 Nanda’s along with their family stirred to India and established
Agriculture equipment’s later they converted this business into automobile products.
In the year 1954 Escorts collaborate with Goetze-Wereke of German manufactures of piston
rings and liners. In the earlier days the piston was imported from other countries. Then the
first piston industry came into existence was in Chennai as a ‘India Piston Limited’. Then
Escorts 2006 majority stake holding acquit ion by Federal Mogul Corporation.
Federal Mogul Power-train is a manufacturer of the auto components. The company involved
in the manufacture, supplier and distribution of automotive components used in two or three
or four-wheeler automobiles. They produce piston, piston rings cylinder liners, light metal
casting and sintered metal products in wide range. They produce 7.1million per annum to
27million per annum. Company is good in fast commitment, enthusiasm and excellence in our
World class team strive to deliver flawless execution daily to achieve leadership in the
markets in which they complete. The Federal Mogul drives profitable growth through their
leading technology and innovation, quality excellence in products and services.
The Bengaluru production plant is located in Yelahanka involved producing a wide range of
piston, piston rings and pins. This plant is connected by air, rail and road routes to all India.

The company promoted by Escorts in November 1954 in technical and Financial

Collaboration with Goetz-Werke of Germany is one of the leading Manufacturers of
Automotive Piston Rings in the world.

GOETZE INDIA LIMITED takeover of Escorts Mahle Ltd, a Leading Manufacturer of

Piston Rings in Oct 2002 made it the largest producer of Piston Assemblies. The Company
has the Production Capacity of 50 million Piston Rings and over 8 million Pistons per year.
The Company had set up its first plant at Patiala and started Commercial Production in
1957.Thesecond plant at Bengaluru was started in 1977.Turneer & Novell, UK which had
ORGANIZATION STUDY

acquired Goetze Internationally has indirectly got a 26% stake in GIL which was hold by
Goetze in GIL. Goetze India has business interest in auto accessories, solvent extraction and
leather garments.

As a part of restructuring it has exited from the Leather Garment Business and is planning to
exit from the solvent extraction business as this plant was shut down throughout the year
2000-2001 due to poor Industrial Conditions.

The Company Manufactures Automobile accessories namely Piston rings, Pistons, Cylinder
liners, light alloy cylinders, piston castings and groove insert sleeves.

And in year 2001 the company merged the Federal Mogul Sintered Products Ltd (FMSPL),
which manufactures sintered metal parts using powder metal Technology under world
renowned 'BRICO' brand, with the Company due to Business Synergies.

1954 Incorporated as a JV with Goetze Werke

Ring & liner Patiala

1957 production

1958 A Patiala
Piston production s escorts
(Automotive Division)
(Collaboration: Mahle)

1960 Cast iron / Forged piston production Patiala

started

Patiala
1968 Pins / ring carrier production started

Bengaluru
1977 Piston / ring production started

1982 Steel rings / Large bore locomotive Bengaluru

Piston
ORGANIZATION STUDY

Patiala
1985 Light alloy products

Bengaluru
1989 Auto thermic pistons production

Patiala
Moly coated / IKA / chrome oil
1990 rings

1992 Large bore rings / pistons for battle Bengaluru

Tanks
1994 Composite pistons / new ring Bengaluru
Foundry

1996 Escorts (Automotive Division) hived off into joint venture with M/S Mahle,
Germany

1997 Goetze TP (India) Ltd. - Manufacturer of steel rings

Merger of Federal-Mogul sintered products Ltd. with Goetze (India)

2001 Ltd.

2003 Merger of Escorts pistons activities with Goetze (India) Ltd.

2004 Introduction of chrome-ceramic rings

2004 Technical collaboration for pistons with Federal-Mogul Corporation

2006 Majority stake holding acquisition by Federal-Mogul Corporation

Name changed "Goetze (India) Limited" to "Federal-Mogul Goetze (India)

2006 Limited"

2.2 NATURE OF BUSINESS:

ORGANIZATION STUDY

Federal-Mogul Powertrain is a leading global supplier of technologies and components in the

passenger car, light and heavy-duty commercial and off-highway vehicle markets, and also
operates in the power generation, aerospace, marine, rail and industrial sectors.

Working in partnership with its customers, Federal-Mogul Powertrain is committed to

delivering superior quality through innovation and engineering excellence, using cutting-edge
proprietary processes. They provide an unmatched breadth of diesel and gasoline
technologies, delivering powertrain solutions that meet specific customer, regulatory and
market requirements.

They are highly-engineered technologies optimize friction, supporting higher compression

ratios and engine downsizing and improving vehicle performance. Advanced component
designs and construction materials enable more efficient powertrain systems, facilitating
vehicle light-weighting, improved fuel economy and lower CO2 emissions.

With more than 37,000 employees worldwide, 100 manufacturing facilities and 14 technical
research and development centres located in 21 countries across the globe, they are the heart
of powertrains, big and small.

2.3 MISION, VISION, QUALITY POLICY:

▪ MISION
The Company as Committed to Increase Share Holder value by aggressively pursuing
Growth and Profit opportunities by providing Innovative, divers and high Performance
products and solutions to meet their Customer’s need.
They will Support their Products with all technical expertise at the Customer end.
They shall provide their work force with an environment that develops steam work
continuous learning and Improvement that rewards good performs.

▪ VISION
To be Global player in the field of Piston, Ring and Sintered parts.Identify best
Practice to move towards manufacturing excellence of the Company. “Federal –
Mogul’s World-Wide Leadership team is focused on leveraging the most advanced
ORGANIZATION STUDY

technologies and innovations in it’s never- ending drive to achieve best-in-class results
and exceed Customers expectations”

▪ QUALITY POLICY
Federal-Mogul Power train is committed to providing Products and Services that meet
or exceed our Customer’s requirements by maintaining a Management system
Complaint with ISO/TS16949, ISO9001, or AS/EN/JSIQ9100.
We accomplish this by fostering Commitments, training and Excellence in our people
and continual Improvement in our Product and Process.

2.4 PRODUCT/SERVICE PROFILE:

1. Pistons
2. Piston Rings
3. Pins
4. Circlips out sourcing (they put all together and supply as Piston Assembly)

1. Piston
A Piston is a Component of Reciprocating Engines, reciprocating pumps, Gas
Compressors and pneumatic Cylinders, among other similar mechanisms. It is the
moving Component that is contained by a Cylinder and is made Gas-Tight by Piston
Rings.

Production Capacity is 13 million Pistons per annum.

Product range is 30mm to 300mm diameter.

Photo No.1 Showing Piston

ORGANIZATION STUDY

Function
The main function of Piston is to transfer the energy developed in engine to Connecting rod
which causes the motion.

Features
▪ Autothermic
▪ Ring Carrier
▪ Double CI Grooves
▪ Forged
▪ Articulated
▪ Steel cap Pistons
▪ Pistons with cooling coil
▪ Thin-walled pistons for cars
▪ Thin-Grooved pistons

Used in
▪ Bi-wheelers
▪ Cars
▪ SUV’s
▪ Tractors
▪ Light and Heavy Commercial vehicles
▪ Heavy output locomotive diesel engines

Raw materials
Piston is made up of Aluminium, Silicon, Magnesium, Nickel etc.
Piston Machine Plant has 18 manufacturing lines. In each line 12 to 20 machines. Each line
produces different Piston.
In every machine there will be 2 displays
1. SOP (Standard Operating Procedure)
2. Control Plan
ORGANIZATION STUDY

PROCESS:
Melting
↓
Pouring
↓
Casting
↓
Fitting
↓
Inspection

5’s is used and followed in Work area

● Sort
● Standardize
● Shine
● Sustain
● Setting orders

ZERO TOLERANCE POLICY

They will not be forced to work under unsafe Conditions. They are required to inform any
unsafe conditions.

DISPOSING USED MATERIALS

● Green Box: Paper, Banana leaves

● Red Box: Used cotton waste, Oil
● Chips formed during the Process which is the waste material formed after cutting
process is recycled to Increase the Efficiency of the Company.
● Scrap that is the rejected Pistons that are passed from Quality Inspection Department is
sent to Foundry where it is melted down again.
ORGANIZATION STUDY

FOR SAFETY

Glasses, Shoes, Ear plugs Compulsory

2 . PISTON RINGS

Piston Ring is a split ring that fits into a groove on the outer diameter of a Piston in a
reciprocating engine such as an Internal Combustion engine or steam engine. Production
Capacity is 55 million rings per annum.
Production range 30mm to 300mm Diameter.

Function
1. It Improves heat transfer from Piston to Cylinder
2. Sealing the Combustion chamber so that there is minimum loss of gasses to the
Crank case.
3. It maintains the proper Quantity of oil between Piston and the Cylinder wall.
ORGANIZATION STUDY

Features
● Thin rings made from SG iron
● Asymmetric profile rings
● Specially honed chrome rings
● Lower sharp edge rings
● Reverse torsion rings
● Conformable chrome oil rings
● Keystone
● Napier
● Nit riding
● Drilled hole oil ring
● Interrupted cut
● Narrow land

Used in
➢ Bi-wheelers
➢ Tractors
➢ Commercial vehicles
➢ Locomotive engines
➢ Industrial
➢ Stationary engine
➢ Passenger car and SUV’s

Raw material
● Cast iron
● Cast iron alloyed for piston rings
● Nodular cast iron alloyed for piston rings
ORGANIZATION STUDY

Process
Casting blank
↓
Cleaned and grounded
↓
Facing
↓
Rough and finish boring
↓
Axially turning
↓
Gap cutting
↓
Packaging

3. PINS

In internal combustion engines, the gudgeon pin is that which connects the piston to the
connecting rod and provides a bearing for the connecting rod to the pivot as it moves thereby
allowing the combustion force to be transferred to the crankshaft.

Raw materials
The raw material is procured in the form of Solid Bright Bars and Seamless Steel Tubes of
various diameters depending upon the requirement of the size of the pin
Gudgeon pin are produced out of alloy steel material generally chromium and nickel.
ORGANIZATION STUDY

Process
It includes two processes
1. Soft machining: Soft machining is a process before the heat treatment.
2. Finish machining: Finish machining is a process after the heat treatment.

The Soft machining processes include cutting of bars/tubes, OD rough grinding, drilling,
length facing and inside chamfering. After these processes are completed the pins are
subjected to heat treatment to attain the desirable hardness.
The finish machining processes include finish length grinding, OD grinding (three passes) and
super finishing. Smaller diameter pins are produced out of seamless tube material and not
passed through a drilling process.
The pins are then put through the machining process and then sent for final inspection, where
they are subjected to dimensional and ultrasonic checking. After inspection, the pins are sent
to the shipping department for delivery to the customer.
ORGANIZATION STUDY

2.5 OWNERSHIP PATTERN

Director
Janice Ruskey Maiden
K C Sundareshan Pillai Ind. Non-Executive Director
K N Subramanian Chairman & Director
Khalid Iqbal Khan Co. Secretary & Compl. Officer
Khalid Iqbal Khan Secretary
Whole Time Director - Legal & Co.
Khalid Iqbal Khan Secretary

Mahendra Kumar Goyal Director

Manish Chadha CFO & Finance Director
Mukul Gupta Director
Rajesh Sihna Director
Sunit Kapur Director
Vinod Kumar Hans CEO
Vinod Kumar Hans Managing & Whole time Director
ORGANIZATION STUDY

2.6 ACHIEVEMENTS / AWARDS

2001-2002: Received an Appreciation Certificate from Kinetic Engineering Limited

for supplying good Quality of Materials and meeting schedules by Escorts Mahle
Limited. 2002: Award for best Performance for Casting from Yamaha Meters India
Private Limited.
2004: Received ISO 14001:2004 Certificate from TUV Certification body for
Environment Management system of RWTUV System.
2004-2005: Award received for QCDDM in Machining Category from Honda
Motorcycle and Scooter India Limited.
2005-2006: Received a Certificate of Appreciation from Standard Group of Companies
for supplying of Components and Marinating good Quality as well.
2005-2006: Certificate received from Mahindra and Mahindra Limited for best
Supplier Performance.
2016: The Company has achieved Volkswagen Group Award for best Supplier.
ORGANIZATION STUDY

2.7 FUTURE GROWTH AND PROSPECTS

FEDERAL MOGUL GOETZE LIMITED is a professionally managed Organization

and it’s aiming of complete of equipment system and signal sources of responsibilities.
The Company is a Leading Global supplier of Power-train and safety to the World by
manufacturing the Automotive, Commercial, Aerospace, Marine, Rail, Agriculture and
Power generation equipment to the World-wide. Federal Mogul mainly Concentrate on
the key factors such as Product, Quality, Cost and Timely delivery. These key factors
act as a tool for the Growth of the Company in Future. The demand for the Automobile
Industry will not decrease due to many factors such as increasing purchasing power of
Employees, changing life style of people, thus it helps to create a demand for the
Product. Auto components manufacturers have grown rapidly due to two factors they
are
1. Automobile manufacturers have grown
2. Replacement market also increased in tune with that.

Another important factor is Research and development which helps to Innovate and
meet
the Competition in the Market.
ORGANIZATION STUDY

Director

Human
Piston Piston Rings FMTPR Finance Resource Purchase

Plant Plant Plant General General General

Manager Manager Manager Manager Manager Manager

Piston Ring
Foundry Foundry Costing Time Office Piston
Foundry

Machine Machine Machine General Training &

Rings
shop shop Shop Accounts Development

Packaging Packaging Packaging Taxation Welfare

Business HR

Health Centre

Security
ORGANIZATION STUDY

CHAPTER 3

MC KENSY’S 7’S FRAME WORK

3.1 INTRODUCTION
The model is most often used as an organizational analysis tool to assess and monitor changes
in the internal situation of an organization.
The model is based on the theory that, for an organization to perform well, these seven
elements need to be aligned and mutually reinforcing. So, the model can be used to help
identify what needs to be realigned to improve performance, or to maintain alignment (and
performance) during other types of change.
Whatever the type of change – restructuring, new processes, organizational merger, new
systems, change of leadership, and so on – the model can be used to understand how the
organizational elements are interrelated, and so ensure that the wider impact of changes made
in one area is taken into consideration.
ORGANIZATION STUDY

OBJECTIVES
● Improve the performance of a company
● Examine the likely effects of future changes within a company
● Align departments and processes during a merger or acquisition
● Determine how best to implement a proposed strategy

The Seven Interdependent Elements

● The basic premise of the model is that there are seven internal aspects of an
organization that need to be aligned if it is to be successful

Hard Elements
● Strategy - Purpose of the business and the way the organization seeks to enhance its
competitive advantage.
● Structure - Division of activities; integration and coordination mechanisms.
● Systems - Formal procedures for measurement, reward and resource allocation.

Soft Elements
● Shared Values
● Skills - The organization's core competencies and distinctive capabilities.
● Staff - Organization's human resources, demographic, educational and attitudinal
characteristics.
● Style - Typical behaviour patterns of key groups, such as managers, and other
professionals.
ORGANIZATION STUDY

3.2 FRAME WORK WITH RESPECT TO COMPANY

1. STRATEGY
The planned devised to maintain and build competitive advantage over the competition.
Strategies are long-term objectives of the organization. SWOT analysis helps the strategies to
survive into external environment.

▪ Service maximization as well as staff maximization.

▪ Increase the turn over to the next year.
▪ Facing the cut throughout the competition.
▪ Adopt the sophisticated technology through decreasing the cost and heavy work force.
▪ Maintaining the good organizational ethics and culture.

2. STRUCTURE
Organizational structure refers to the formal relationships among various positions and
activities performed in the organization. Organizational structure involves
arrangements about reporting relationships, line of communication, rules and
procedures which exist to guide the various activities performed by various
hierarchical position in the organizational structure.
ORGANIZATION STUDY

Rajesh
Sinha

Human pistons SI Rings Steel Rings Purchase

resource Finance

3. SYSTEMS

It refers to all rules, regulations, procedures that complement the organization structure. It
includes production, planning and control system, cost accounting procedures, capital
budgeting system, recruitment, training and development system, performance evaluation
system.
▪ Internal control and risk management system in relation to the company financial
reporting process.
▪ Automated systems for manufacturing
▪ Waste disposal system.
▪ Recruitment system is done every 3 months for the IT students.

4. STYLE
Style is one of the tools which top managers can use to bring about organizational changes. It
is the pattern of management team over a period of time.
▪ Management is the central power sources that make the decision under the guidelines
issued by the head office.
▪ Head of each department constitute the management committee headed by the dir
ORGANIZATION STUDY

▪ The committee formulates strategic plans and policies to take the business forward and
review implementation of the company’s annual plan.
▪ Participative leadership in some regards
▪ Employees have the freedom to train themselves through learning courses.

5. STAFF
Staffing is the process of acquiring human resource for the organization and assuring that they
have the potential to contribute to the achievements of the organizational goals thus: staffing
is selection, placement, training & development of appropriate and qualified employees.

▪ Staff required for operation of automated systems

▪ Internships for graduate
▪ Reward systems in place
▪ They generally prefer to have highly qualified and dedicated management
professionals.
▪ The recruitment policy aims at being fair and consistent.

6. SKILLS

Skills are the most important attributes or capabilities of an organization. The company’s
structure, strategy, systems, style, staff and skills all stem from why the organization was
ORGANIZATION STUDY

originally created and what it stands for. The original vision of the company was formed from
the values of the creators. As the values change, so do all the other elements.

▪ One-year monitoring program by senior officers of the different departments

▪ The learning includes: individual learning, team learning and organizational learning.
▪ The company conducts seminars.
▪ HRD department conducts program train the trainer and workshop to trainees.

7. SHARED VALUES

Shared value of the organization can be characterized as the whole of the norms, views and
culture shared by the people working in the organization. The values are the things that you
would save even if they were demonstrably not profitable.

▪ Federal Mogul are a team first

▪ Federal Mogul respect, trust and help each other
▪ Federal Mogul act with integrity
▪ Federal Mogul strive for excellence in all we do
▪ Federal Mogul create a value through innovation
▪ Federal Mogul celebrate our success
ORGANIZATION STUDY

Porter's Five Forces

The tool was created by Harvard Business School professor Michael Porter, to analyze an
industry's attractiveness and likely profitability. Since its publication in 1979, it has become
one of the most popular and highly regarded business strategy tools.
Porter recognized that organizations likely keep a close watch on their rivals, but he
encouraged them to look beyond the actions of their competitors and examine what other
factors could impact the business environment. He identified five forces that make up the
competitive environment, and which can erode your profitability. These are:
Competitive Rivalry. This looks at the number and strength of your competitors. How many
rivals do you have? Who are they, and how does the quality of their products and services
compare with yours?
Where rivalry is intense, companies can attract customers with aggressive price cuts and high-
impact marketing campaigns. Also, in markets with lots of rivals, your suppliers and buyers
can go elsewhere if they feel that they're not getting a good deal from you.
On the other hand, where competitive rivalry is minimal, and no one else is doing what you
do, then you'll likely have tremendous strength and healthy profits.
Supplier Power. This is determined by how easy it is for your suppliers to increase their
prices. How many potential suppliers do you have? How unique is the product or service that
they provide, and how expensive would it be to switch from one supplier to another?
The more you have to choose from, the easier it will be to switch to a cheaper alternative. But
the fewer suppliers there are, and the more you need their help, the stronger their position and
their ability to charge you more. That can impact your profit.
Buyer Power. Here, you ask yourself how easy it is for buyers to drive your prices down.
How many buyers are there, and how big are their orders? How much would it cost them to
switch from your products and services to those of a rival? Are your buyers strong enough to
dictate terms to you?
When you deal with only a few savvy customers, they have more power, but your power
increases if you have many customers.
Threat of Substitution. This refers to the likelihood of your customers finding a different
way of doing what you do. For example, if you supply a unique software product that
automates an important process, people may substitute it by doing the process manually or by
outsourcing it. A substitution that is easy and cheap to make can weaken your position and
threaten your profitability.
ORGANIZATION STUDY

Threat of New Entry. Your position can be affected by people's ability to enter your market.
So, think about how easily this could be done. How easy is it to get a foothold in your industry
or market? How much would it cost, and how tightly is your sector regulated?
If it takes little money and effort to enter your market and compete effectively, or if you have
little protection for your key technologies, then rivals can quickly enter your market and
weaken your position. If you have strong and durable barriers to entry, then you can preserve
a favourable position and take fair advantage of it.
ORGANIZATION STUDY

CHAPTER 4

SWOT ANALYSIS
The SWOT Analysis is a strategic planning method that is used to evaluate the Strength,
Weakness, Opportunity and Threats. SWOT analysis is a tool for auditing an organizational
and its environment. SWOT analysis is the first stage of planning and helps marketers to focus
on key issues. Once key issues have been identified the details are fed into marketing
objectives. SWOT analysis can be used in conjunction with other tools for audit and analysis,
such as PEST analysis and Porter’s Five-Force analysis. SWOT analysis is a very popular
tool, quick and easy to learn.

Strength
✓ Better team work
✓ Company act with Integrity
✓ The Company is highly motivated and focused
✓ Good reputation in the Market
✓ Reduces cost through high productivity
✓ Testing of Product before sale
✓ Create healthier Customer relationships
✓ Contentious Technological Advancement and Product Innovation

Weakness
ORGANIZATION STUDY

✓ Lack of motivation of employees

✓ Low return on capital employed
✓ Lack of friendly environment
✓ The cost involved in completion of project is high

Opportunities
✓ Opportunity of expanding business to other markets worldwide.
✓ Increasing demand for the product in the world market
✓ Making strategic alliances can be a smart strategy
✓ Pioneer fuel-efficient vehicles
✓ Growing the auto mobile industries have positive impact.

Threats
✓ Raising raw materials
✓ Increase in the number of competitors
✓ Volatility in the fuel prices
✓ Sluggish economy like recession, uncertainty, macro-economic factors
✓ High fixed cost and R&D investment
✓ Increase interest rate of banks and difficulty in payment of loan
ORGANIZATION STUDY

CHAPTER 5

ANALYSIS OF THE FINANCIAL PERFORMANCE OF THE COMPANY FOR THE

PERIOD 2012-2016

Ratio Analysis
The ratio analysis is a form of financial statement analysis which is used to obtain a quick
indication of the company’s financial performance. It gives a information about profit and loss
of the company. This ratio analysis will be done based on the profit and loss account and the
balance sheet of the company. This will help to determine the company position in the market.

1. Current Ratio
It is liquidity ratios which measure the company’s ability to pay short term and long-term
obligations. It includes cash, marketable securities, inventory, accounts receivables. These
ratios can be used to take a rough measurement of company’s financial conditions.
Formula:

Current Ratio = Current Assets / Current liabilities

Table no 5.3 : Shows current ratio of the company

Current Assets Current Liabilities

Year in crs in crs Current ratio

2016 477.86 442.93 1.07

2015 425.35 459.55 0.92

ORGANIZATION STUDY

2014 350.05 389.08 0.89

2013 336.36 384.35 0.87

2012 359.23 378.11 0.95

Graph no 5.3 : Shows current ratio of the company

Interpretation
The above graph shows the current ratio of 2012 to 2016. In the year 2012 to 2013 the ratio
has decreased. From the year 2013 to 2014 it has increased to 0.89. From the year 2014 to
2015 it has increased to 0.92. From the year 2015 to 2016 it has increased to 1.07. We can get
the idea from the above table that current ratio has a good liquidity position expect in the year
2013.

2. Quick Ratio
ORGANIZATION STUDY

The quick ratio explains about how well the company can meet its short term financial
liability. It is also known as acid test ratio. The ratio can be calculated as follows cash +
marketable securities + account receivables or current liabilities.
Formula: Quick Ratio = Current Assets – Inventories

Table no 5.4 : shows quick ratio of the company

Current Liabilities
Year Quick Assets in Crs in crs Quick Ratio

2016 281.51 442.93 0.64

2015 227.45 459.55 0.49

2014 201.6 389.08 0.52

2013 202.9 384.35 0.53

2012 230.74 378.11 0.61

ORGANIZATION STUDY

Interpretation
The above graph shows quick ratio of the company. It shows that in the year 2012 the ratio
was 0.61, for the year 2012 it has decreased to 053, for the year 2014 this has decreased to
0.52, for the year 2015 again the ratio has decreased to 0.49, for the year 2016rapidly the
quick ratio has increased to 0.63. This indicates that the company has better positions when
compared to its previous year in meeting its financial liabilities.

3. Return on Assets
Is an indicator of how gainful a company is relative to its entire assets. It gives a clear idea

about the company how efficient management is at using its assets to generate earnings.

Formula:

Return on Assets = Net profit after Tax/ Total Assets *100

Ta
ble Year NPAT in crs Total Assets in crs Return on Assets Ratio no

2016 44.01 1058.93 4.15

2015 31.36 986.24 3.17

2014 20.58 903.72 2.27

2013 -5.06 856.07 -0.59

2012 37.63 856.97 4.39

5.5: Shows return on assets of the company

ORGANIZATION STUDY

Graph no 5.5: Graph shows return on assets of the company

ORGANIZATION STUDY

Interpretation:
The above graph shows the change in the return on assets for the year 2012 was 4.39, for year
2013 it has a negative value that is -0.59, for the year 2014 it has moved to positive value that
is 2.27, for the year 2015 this ratio has increased to3.17, for the year 2016 again it has
increased to4.15. In the year 2016 company is in a better position in its efficient management
of assets from 2013 onwards.

4. Expense Ratio
It includes expenses on staff, allowances, rent, insurance, tax, postage, audit fee, stationary
and
other expenses. It is calculated with the help of total percentage of fund assets used by the
company for expenses of various types.
Formula:
Expense Ratio = Total Expenses/Total income

Table no 5.6: Shows expenses ratio of the company

Total Expense Total Income in
Year crs Expense Ratio
in crs

2016 1291.36 1363.16 0.95

2015 156.5 1573.96 0.97

2014 1129.18 1159.54 0.97

2013 1208.31 1200.73 1.01

2012 122.33 1169.14 0.96

Graph no 5.6: Shows expense ratio of the company

ORGANIZATION STUDY

Interpretation
From the year 2012 to 2013 the expense ratio has increased than again in the year 2014 it
has reduced to 0.97. This ratio again has further reduced for the year 2015 to 2016, which
is beneficiary to the company.
ORGANIZATION STUDY

CHAPTER 6

6.1 LEARNING EXPERIENCE

.
 The organization study at Federal mogul Yelahanka has given me the opportunity to
understand corporate culture and to gain valuable industry related experience that
would allow me to expand my career options.
 I was able to utilize and engage the knowledge and skills gained at Federal Mogul in a
more practical approach.
 From this study I could able to analyse the financial statement and it helped me to
analyse the SWOT.
 During the course of study, I was successful in achieving these objectives and could
familiarize with an organization and its environment.
 The study was conducted with a view to understand the functions of an organization,
and its various departments
 This study has improved my confidence by its successful completion to undertake such
studies in the future.
 The guidance, support, feedback and useful suggestion provided by my project guide
helped me to successfully complete this organization study.
ORGANIZATION STUDY

6.2 SUGGESTIONS

 In work place most of the employees do not use the safety measures. It must be made
compulsory.
 Always follow ‘Prevention is better than Cure’ policy at
work.

 Improve housekeeping.
 Cleanliness has to be further improved.
 Mutual trust, better communication pattern and proper personal interaction between
the employee and employer.
 Maintain a proper balance between the management and workmen for overall
development.
 Electronic security system to be used at all gates.
ORGANIZATION STUDY

6.3 BIBLOGRAPY

List of books

Employee Training and development – Raymond

Neu HRD – Udai Pareek
Human Resource management – Dr. K . Aswatappa

List of Magazine and journals

Business World
Company record and journals

List of Websites

www.google.com
www.federal-mogul.com
ORGANIZATION STUDY

6.4 ANNEXURE

Federal Mogul Goetz Ltd Profit and loss A/C Statement (in Crs)

Year Year Year Year Year

INCOME
2016 2015 2014 2013 2012

Revenue from operations(gross) 1426.78 1615.26 1206.71 1254.76 1201.68

Less: Excise duty 135.25 130.57 108.79 112.98 93.98

Revenue from operations(net) 1291.53 1484.69 1097.92 1141.78 1107.7

Other operating Revenues 36.2 51.84 39.05 44.86 44.42

Total operating revenue 1327.73 1536.53 1136.97 1186.64 1152.12

Other income 35.43 37.43 22.57 14.09 17.02

Total revenue 1363.16 1573.96 1159.54 1200.73 1169.14

EXPENSES

Cost of materials consumed 456.46 551.13 394.86 432 428.19

Purchase on stock in trade 48.68 53.79 37.77 36 36.56

Change in Inventories of FG, WIP

5.3 -33.27 -20.55 -11.08 -24.41
and stock in trade

Employee benefit expenses 284.61 319.5 236.16 235.11 213.32

Finance cost 28.42 36.97 26.78 29.88 24.86

ORGANIZATION STUDY

Depreciation on amortization
75.18 89.37 66.14 61.94 53.66
Expense

Other expenses 392.76 509.01 388.05 424.46 390.15

Total expenses 1291.41 1526.5 1129.21 1208.31 1122.33

Profit and loss before tax 71.8 47.46 30.36 -7.58 46.81

Current tax 18.77 25 8.85 2.89 16.27

Less: MAT credit entitlement 0 0 0 0.09 3.93

Deferred tax 7.04 -10.9 0.93 -0.28 -1.16

Tax for earlier year 1.98 2 0 0 0

Total tax expenses 27.79 16.1 9.78 2.52 11.18

Profit/loss after tax and before

44.01 31.36 20.58 -5.06 37.63
extraordinary items

Prior period items 0 0 0 0 0

Profit or loss for the period 44.01 31.36 20.58 -5.06 37.63
ORGANIZATION STUDY

Federal Mogul Ltd Balance sheet (in Crs)

Year 2016 Year 2014 Year 2013 Year 2012

Particulars Year 2015

Shareholder's funds

Equity Share Capital 55.63 55.63 55.63 55.63 55.63

Total Share Capital 55.63 55.63 55.63 55.63 55.63

Reserve and Surplus 434.77 395.14 363.79 343.2 359.56

Total Reserve and

434.77 395.14 363.79 343.2 359.56
Surplus

Total Shareholders’
490.41 450.77 419.42 398.83 415.19
Funds

Non-Current liabilities

Long term borrowings 37.22 7.22 15.56 0 4

Deferred tax liabilities 9.13 4.34 15.24 14.31 14.59

Other long term

4.32 3.97 2.78 2.45 2.54
Liabilities

Long term provisions 74.92 60.39 61.66 56.12 42.53

Total Non Current

125.59 75.92 95.24 72.88 63.66
Liabilities

Current Liabilities

Short term borrowings 154.1 212.53 186.89 190.21 144.8

ORGANIZATION STUDY

Trade payables 252.33 223.35 175.53 171.08 208.63

Other current liabilities 32.44 21.7 25.22 19.85 21.13

Short term provisions 4.06 1.97 1.44 3.21 3.55

Total Current
442.93 459.55 389.08 384.35 378.11
liabilities

Total Capital and

1058.93 986.24 903.72 856.07 586.97
Liabilities

ASSETS

Noncurrent Assets

Tangible assets 520.56 467.67 473.92 459.34 424.34

In-tangible assets 0 0 0 0.16 0.29

Capital WIP 31.92 56.42 33.19 36.07 36.73

Fixed Assets 552.48 524.09 507.11 495.57 461.36

Non Current
5.1 5.1 5.1 5.1 10.21
Investments

Long term Loans and

23.49 31.7 41.46 18.92 14.95
Advances

Other noncurrent assets 0 0 0 0.12 0.51

Total Non Current

581.07 560.89 553.67 519.71 487.03
Assets

Current Assets
ORGANIZATION STUDY

Current Investments 0 0 0 0 10.71

Inventories 196.35 197.9 148.45 133.46 139.2

Trade Receivables 181.17 172.93 146.65 150.47 150.7

Cash and Cash

43.48 9.77 5.93 1.77 2.12
Equivalents

Short term Loans and

51.6 39.77 45.02 46.85 58.99
Advances

Other current assets 5.26 4.98 4 3.81 8.22

Total Current Assets 477.86 425.35 350.05 336.36 359.23

Total Assets 1058.93 986.24 903.72 856.07 846.26

ORGANIZATION STUDY
ORGANIZATION STUDY