A REPORT ON ORGANIZATIONAL STUDY

AT

CARBORUNDUM UNIVERSAL LTD

(CUMI) NALUKETTU , KORATTY

Submitted
ALIAS A Y

Under the Guidance of

PROF . S . G . BHAT

In
Partial fulfillment of the requirements for
the award of the degree of
Master of Business Administration

Department of Management Studies

ADI SHANKARA INSTITUTE OF ENGINEERING & TECHNOLOGY

(An ISO 9001:2008 Certified Institution)

(2012-2014)

1
 DECLARATION

I, ALIAS A Y hereby declare that this report of the Organizational Study at

CARBORUNDUM UNIVERSAL LIMITED, KORATTY , NALUKETTU has been
prepared by me under the guidance of Prof. S.G. BHAT, ADISHANKARA INSTITUTE
OF ENGINEERING AND TECHNOLOGY, Kalady . I also declare that this training
report is my original work and it has not previously formed the basis for award of any
degree or diploma.

Date:
Place: Kalady ALIAS A . Y.

2
 ADI SHANKARA INSTITUTE OF ENGINEERING & TECHNOLOGY
Shankar Nagar, Mattoor, Kalady

CERTIFICATE

Certified that this is a bonafide record of the project work “Organizational Study”

submitted by ALIAS A Y during the year 2012-2014 inpartial fulfillment of the

award of the degree of Master of Business Administration.

Faculty Guide H.O.D (MBA) Principal (ASIET)

3
 ACKNOWLEDGEMENT

The successful and timely completion of this Organization Study

and its reports become possible only with those eminent personalities who extended their
wholehearted support and valuable assistance.

First of all I would like to extend my gratitude to our Principal Dr. Prof. S G IYER,
our HOD and guide Prof. S G BHAT of ASIET College, Kalady for their excellent
encouragement and support throughout the course of this project.

I express my humble gratitude to Mr. JULIUS V. D. , HR Executive of

Carborundum Universal Limited (CUMI), Nalukettu ,Koratty for his guidance , support
and friendly cooperation which shaped this organizational study from its completion . .I
express my sincere thanks to Mr. BIJU ISSAC, Plant manager of Carborundum
Universal Limited (CUMI), Koratty .

Above all, I thank the power and spirit of universe, the Almighty, for his inspirations
throughout the life.

Date: ALIAS A Y
Place: Kalady

4
 TABLE OF CONTENT

Chapter No. Title Page No.

1 Introduction

- Objective of study
- Scope of the study
- Limitation

2 Industry Profile

3 Company Profile

Organisation Structure

Product Profile
4 Functional Departments

4.1 Operation department

(a) Production department

(b) Quality department
(c) Maintenance department

4.2 HR department

4.3 Finance department

.
4.4 Shipping &Marketing
. department

. 4.5 System department

5 SWOT Analysis
6 Conclusion

Appendix

Bibliography

5
 CHAPTER 1

INTRODUCTIO

6
INTRODUCTION

The organizational study was conducted in Carborundum Universal

Limited, Koratty. As a part of MBA course this organizational study helps to know about the
organizational activities and various functions of the different department . The
organizational study was mainly conducted for knowing the particular organization and also
for getting amble information about the activities of each department.

Carborundum Universal was established in 1954 as a joint venture between

the Murugappa Group, India, the Carborundum Co., USA, and the Universal Grinding
Wheel Co. Ltd, U.K. . The main business activity of Carborundum Universal involves
manufacture of coated abrasives, bonded abrasive, super-refractories, electro-minerals,
industrial ceramics, and ceramic fibers. Further, CUMI produces about 20,000 different
varieties of abrasive products, refractory products, and electro-minerals. Carborundum
Universal Ltd. has 10 manufacturing facilities across India and these manufacturing facilities
are meticulously connected with wide network of distributors and sub – distributors .

CUMI is known to be an innovator and exports its products to 43

countries spread across North America, Europe, Australia, South Africa, and Asia. All the
manufacturing facilities of Carborundum Universal are ISO 9001:2008 , ISO 14001: 2004
and ISO 18001: 2007 certified for quality standards , environment-friendly and health-
safety manufacturing practices respectively.

7
Objectives of the study:

 To study the functions of various departments

 To understand the process flow in each departments
 To understand hierarchical structure of various departments
 To do SWOT analysis of organization
 To have an exposure to the working environment

Scope of the study:

The study has been conducted at Carborundum Universal Ltd, Koratty, Thrissur, Kerala,
during the period of May, 2013.The study focuses on overall understanding of how the
various departments in the organization function.

Limitation :

 Time is a major limitation since the organizational study was only for a period of
one month
 Officers were at the peak of work and busy schedule of the department heads

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 CHAPTER 2

INDUSTRY PROFILE

9
 INDUSTRY PROFILE

World scenario
The electro mineral industry faced competition from imports but this was counted by
delivering quality product . In the export market, removal of anti-dumping duty of Chinese
product export to Europe. However during period the European counties are falling to
financial crisis . Many of companies stopped their production or quantity of production is
decreasing due to financial crisis .

Indian scenario
CUMI will continue to focus on quality and application, specific product offering and on
improving its customer base. In the domestic market there are 3 manufactures for electro
minerals. CUMI is market leader in the Indian Industry .The export market will be targeted
with Silicon Carbide micro grit with improved in product quality. CUMI is a major player
in the domestic market for the Brown and White Fused Aluminum Oxide and Silicon
Carbide. The key success factor in the industry is cost and quality, while entry barriers are
sophisticated technology. The availability of substitute product, product differentiation and
imports continue to be the principle challenge in the business.

State Scenario
There was a 17% increase in power tariff in Kerala, which adversely affected the
profitability of the electro-minerals industry. This was future compounded by the low power
plant due to poor monsoon in Kerala last year. The cost push created by improvement in
operating efficiencies of the country. Use of consumption and reduction in power
consumption and improvement in crude recovery helped in the same.

Competitions
In India there are four main players in this Industry. Apart from CUMI, SNAM Abrasives,
Orient Abrasives and Grind well are the major players. In order to mitigate the competition
risk, CUMI entered into a joint venture with Wendt India and holds 40% of its share
capital. After the joint venture, it now offers full range of abrasives to its Customer‟s viz.
conventional and super abrasives. Super abrasives are manufactured by Wendt India Ltd. at
its plant located at Hosur in Tamil Nadu. CUMI is a market Leader in Indian abrasive

10
industry and enjoys a share of more than 45% followed by Grind well Norton which has a
share of 40% in the abrasive market.

Major Players (Major Competitors )

 3M Coated abrasives division(USA)
 Abandon Silicon Carbide of Aluminum production complex(ABASIC)
 Abrasive Grains E.T Powder SA(AGP)France
 Beiging Kingder Resource and Technology Development Corporation (China)
 Carborundum Universal LTD (India)

Carborundum Universal Limited manufactures the widest range of Bonded and Coated
abrasives in the world. The Rs 314 crore, the company pioneered the manufacture of coated
and bonded abrasives in India, besides super refractories, electro minerals, industrial
ceramics and ceramic fibers. CUMI makes over 20,000 different varieties of abrasives,
refractory products and electro-minerals, manufactured at 14 locations. CUMI has the
distinction of having all its manufacturing units ISO 9001: 2008 certified.

Industry overview
Competition is increasing day by day so that the product development will be the main
criteria. Our mineral resources are limited so there is a challenge in future development.
High capital investment, limited market, sophisticated technology, availability of substitute
products, product differentiation & import are the principle challenges in this industry.

Exports
Carborundum industry plays a significant role in the growth of Indian economy and it is an
important component of global trade.. It is the second largest industry of India and is the
largest foreign export earner, accounting for 35% of the gross export earnings in trade
.They export 23 countries across the world.

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 CHAPTER 3

COMPANY PROFILE

12
 COMPANY PROFILE

ESTABLISHMENT
CARBORUNDUM UNIVERSAL LTD (CUMI)
Carborundum Universal, also known as Carborundum Universal
Ltd (CUMI) is an India-based coated and bonded abrasive manufacturing company
.Carborundum Universal was established in 1954 as a joint venture between the Murugappa
Group, India, the Carborundum Co, USA,and the Universal Grinding Wheel Co. Ltd, U.K.
The main business activity of CUMI involves manufacture of coated abrasives, bonded
abrasive, super- refractories, electro-minerals, industrial ceramics, and ceramic fibers.
Further, CUMI produces about 20,000 different varieties of abrasive products, refractory
products, and electro-minerals. Carborundum Universal Ltd. has 14 manufacturing facilities
across India and these manufacturing facilities are meticulously connected with a wide
network of distributors and sub distributors. The company pioneered the manufacture of
Coated and Bonded Abrasive in India in addition to the manufacture of Super Refractories,
Electro Minerals, Industrial Ceramics and Ceramic Fibres. Today the company ranges over
20,000 different varieties of abrasives, refractory products and electro-minerals are
manufactured in ten locations across various parts of the country.

CUMI-Business Distribution (As per the revenue)

CUMI is known to be an innovator and exports its products to 23

countries spread across North America, Europe, Australia, South Africa, and Asia. All
the manufacturing facilities of Carborundum Universal are ISO 9001:2008 certified for
quality standards and ISO 14001 certified for environment-friendly manufacturing

13
 practices and OSHAS 18001 certified for health and safety respectively. Carborundum
Universal Ltd Koratty , electrominerals unit established in 1985 . The R & D wing comes
out with constant innovations and product up gradations of products, which makes the
company a world leader in grinding technology. Its core competence provides total
grinding solutions which enables maximum grinding efficiencies and reduced cost for
customers.

COMPANY HISTORY YEAR EVENTS

1954-1963 Revenues Rs.19 million

 Incorporate as a joint venture between caborundum company,

USA/Universal Grinding Wheel Company, UK and the Murugappa Group,
India.
 Acquired a coated abrasives facility from Ajax Products pvt.ltd.
 Bonded abrasives facility set up at Chennai, India
 Bauxite mining at Bhatia,gujurat,india

1964-1973 Revenues Rs.78 million

 Manufacture of super refractories at Chennai, India

 Brown aluminum oxide grains plant at Edappally, India
 Bauxite mining at Bhatia, Gujarat

1974-1983 Revenues Rs.337 million

 Acquisition of Eastern Abrasives Ltd,a coated abrasives manufacturer in

Kolkata, India
 Second bonded abrasives plant at Hosur, ,India
 Established MMECL as a joint venture with Morgan Group plc,for ceramic fibres

1984-1994 Revenues Rs.1308 million

14
 Expansion of bonded abrsives plant at Hosur with a modern facility for
vitrified grinding wheels.

15
  Silicon carbide plant at Koratty & Refractories plant Ranipet,India
 Industrial ceramic plant at Hosur, India
 Acquisition of 40% interest in Wendt (India) Ltd., a joint venture with Wendt
Gmbh, Germany for super abrasives.

1995-2004 Revenues Rs.3150 million

 12 MW Hydel project at Maniyar ,Kerala

 Second unit at Edapally for manufacture of brown aluminum oxide grains.
 Acquired a controlling interest in Cut fast Abrasive Tool Ltd,and cut fast
Polymer ltd,a Chennai Based abrasive manufacturer and subsequent mergers
 Established a 5.5MW natural gas based thermal power plant in Nallur in Tamil
Nadu, India through Southern Energy Development Corporation Ltd.
 Acquired Prod rite Anticorrosive ltd, a leading player in anti-corrosion engineering.
 Cloth proceeding facility at Maraimalainager ,Tamil Nadu

2005-2012 Revenues Rs.12126 million

 Capital investment of about Rs.4 billion for various modernization,

expansion/new product projects.
 Automated thin wheel facility at Hosur and Chennai, India
 Modern silicon carbide micro grit plant in Koratty, India
 Modern polymer manufacturing facility near Chennai, India
 Establishment of CUMI Middle East & CUMI Canada Inc.
 Establishment of state of –the-art coated abrasives Sriperambudur ,Chennai ,India
 Acquisition of monolithic refractory facility in Jabalpur, India
 Acquisition of Volzhskiy Abrasives Works, Russia
 Acquisition of the Technical Ceramics Unit at Aurangabad, India
 Acquisition of 51% holding Foskor Zirconia (Pty)Ltd ,South Africa, the
world‟s largest manufacturer of Zirconia

16
  World class facility for wear resistant liner, tiles, Hosur, India
 Manufacturing facility for Thin Wheels, Uttarkhand, India
 Manufacturing facility for Power Tool at Jigani, Bangalore, India.
 Commissioning of a modern 1,000 tonne vitrified bonded abrasives plant &
2,000 tonne organic bonded abrasives facility in China
 Establishment of state-of-the-art metalized cylinder plant at Hosur, India
 Establishment of state-of-the-art super refractory‟s plant at Ranipet Serkaddu,India
 Setting up of a modern facility for manufacture of anti-corrosive products
at Serkaddu, India
 Establishments of automated silicon carbide micro grit plant in Cochin SEZ

Koratty plant

Carborundum Universal Limited Koratty , Electrominerals Macro unit established in 1985 .

The plant main product macro Silicon Carbide . Modern Silicon Carbide micro grit plant
established in 2005 . Now the plant capacity , Plant macro unit about 1000tons per month
and micro unit about 750 tons per month .

VISSION AND MISSION

Vision:

The vision of the Carborundum Universal Limited is “we will be admired technical ceramic
company driven by innovation continuously enhancing stakeholder wealth”

Mission:

The mission of the Carborundum Universal Limited “we will steadily improve EMD‟s
profitability and grow aggressively in new products and micro grits.”

To be innovative, resourceful, and profitable company.

To meet customer requirements of quality service and price consistency.
To make doing business with us easy, and delightful to our customers.

17
 To provide an entrepreneurial environment in which employees can respond to the
needs of business and service, earn fair rewards and can be satisfied.

OBJECTIVES

 To maintain the market leadership.

 To minimize the cost incurring in production process.

 To maintain the product quality.

 To be competitive at all markets.

 To be compliment to all global quality standards.

 To maintain the top position in the industry.

 To utilize the new technological changes for the benefit of the company

Forward into the Future

Carborundum Universal Limited is gearing for its next phase of growth and
expansion .Growth that could be defining and provide a quantum leap in terms of terms of
scope and scale .Continuing its journey in sustainability , the company has drawn up plans
for expansions , acquisitions and synergistic alliances with international technology
providers .

Flagging the commencement of this phase , CUMI has entered into

an agreement for acquisition of a fused minerals and super refractory products
manufacturing facility which will be named as Thukela Refractories , South Africa .

CUMI „s vision is value driven and based on trust and enduring people
relations . Relationships that transcend transactions and celebrate sustainability as an integral
part of growth .

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 ENVIRONMENTAL POLICY:

We at CUMI are committed to be an eco friendly organization and shall strive to

protect, preserve and to improve our environment. This will be achieved through

 Continual improvement of the operations for achieving better

environmental performance
 Optimizing usage of energy and other resources
 Minimizing waste generation and disposing appropriately to reduce the on
the environment
 Complying with environmental legislations and regulations other requirements
to which the organizations subscribes
 Creating environmental awareness among all those who work and on behalf of
the organization

QUALITY POLICY

We shall proactively meet customer expectation by providing quality products and services.
This will be achieved through:

1. Total commitment of the management in implementing an effective

quality management system
2. Continual technological development in fulfilling changing need of the customer.
3. Total employee involvement for continues improvement
4. Enhancing employee competence through education and training
5. Building mutual beneficial relationship with suppliers

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BOARD OF DIRECTORS

Mr. M . M. Murugappan : Chairman

Mr. Subodh Kumar Bhargava : Non – executive Director

Mr. T L Palani Kumar : Non – executive Director

Mr. Sridhar Ganesh : Non – executive Director

Mr. Lakshminarayan : Non – executive Director

Mr . Shobhan M Thakor : Non – executive

Director Mr. Sanjay Jayavarthanavelu : Non – executive

Director Mr . K Srinivasan : Managing Director

CUMI Plant Locations

1 CUMI Plant location

 CUMI , Tiruvottiyur ,Tamil Nadu

 CUMI , Bonded Division , Hosur ,TN
 CUMI , Cutfast Division , Pallikaranai , TN
 CUMI , Parganas District , West Bengal
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  CUMI WINDFARM , Tirunelveli , TN
 CUMI , Industrial Ceramics Division , Dharmapuri , TN
 CUMI , Super Refractories Division , Ranipet , TN
 CUMI , Electrominerals Divisions ,Kalamassery , Kerala
 CUMI , Micro plant , Cochin SEZ , Kakkanad

2. Plant locations of Subsidiaries / Joint Ventures

 Sterling Abrasives Ltd , Gujarat

 Muragappa Morgan Thermal Ceramics , Ranipet ,TN
 Wendt Ltd , Hosur , TN
 Volzhsky Abrasive Works , Russia
 CUMI Abrasives & Ceramics Co. Ltd , China
 CUMI Australia PTY . Ltd , Malaga
 CUMI Canada Inc.

21
ORGANISATION STRUCTURE

22
 ORGANISATION STRUCTURE

MD
K.S.
SENIOR VICEPRESIDENT
(EMD)
N ANANTHASESHAN
GENERAL MANAGER (
MANUFACTURING)

A R SATHEESH

SENIOR MANAGER
MANAGER MANUFACTURINJG SENIOR SYSTEM SR MANAGER SENIOR SENIOR
ACCOUNT MANAGER ADMINI- ENGINEERING MANAGER MANAGER
SHIPPING STRATOR & TQM & QA HR
MAINTENANCE

MANAGER MANAGER
ASSIT MANAFACTURI- SHIPPING DEPUTY DEPUTY HR
MANUFACTURING
ACCOUNT NG EXECUTI- MANAGER MANAGER
(MICRO)
QA EXECUTIV
(MACRO) VES

SUPERVISOR
STORE

DM DM OPERATIVE TEAM SUPERVISOR SUPER-

MANUFACTURING MANUFACTURING S MEMBERS VISOR

JR JR. OPERATIVES TEAM

MEMBE
SUPERVIS RS

OPERATIVES OPERATIVES

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NATURE OF PRODUCT

Silicon Carbide is a man made mineral of extreme hardness and sharpness. It is the ideal
abrasive for grinding / sanding materials of low tensile strength such as Cast Iron, Brass,
Aluminum, Bronze etc. Its thermal properties make it an excellent medium for use in the
manufacture of refractory products and crucibles.

Silicon Carbide is produced by a process involving the electrochemical reaction of silica –

in the form of quartz with Carbon in the form of raw petroleum coke. The stoichiometric
mixture is reacted in an electrical resistance furnace at a temperature greater than 2200˚C to
yield high quality crystals. The large crystals are then segregated, crushed, cleaned of
magnetic impurities in high intensity magnetic separators and classified into narrow size
fractions to suit the end use. Dedicated lines produce products for different applications.

Silicon Carbide Grains are also used in marble and granite polishing, manufacture of Kiln
furniture and as a deoxidizer in Iron and steel making.

Silicon carbide (SiC), also known as carborundum, is a compound of silicon and carbon
with chemical formula SiC. Silicon Carbide powder has been mass-produced since 1893
for use as an abrasive. Grains of silicon carbide can be bonded together by sintering to form
very hard ceramics which are widely used in applications requiring high endurance, such as
car brakes, car clutches and ceramic plates in bulletproof vests.

24
 CHAPTER 5

FUNCTIONAL DEPARTMENTS

25
4.1 .a. PRODUCTION

DEPARTMENT Production

department structure

GENERAL MANAGER

SENIOR MANAGER MANUFACTURING

MANAGER MANUFACTURING MICRO

MANAGER MANAFACTURING MACRO

DM MANUFACTURING DM MANUFACTURING

JR SUPERVISOR
OPERATIVES
JR SUPERVISOR

OPERATIVES

26
SILICON CARBIDE is the major product produced in CUMI Ltd. Raw materials used
are quartz and raw petroleum coke. These two raw materials are furnished at a
temperature of 2200 °C. This furnished product is classified in to two

 Macro
 Micro

MACRO

1) Furnace plant

The raw materials of the product are quartz and coke. They are mixed along with reclaim for
making mix charge as per the mix card issued by QA .One mix charge should be nearly
4tonnes ( ONE MIX = COKE 560 kg ,QUARTZ 800 kg ,Brg1 200kg ,Brg2 2350kg ,Water
100L ).Like wise 20 mixes will be used to fill a furnace. Furnasing will continue for 48
hours. After that it will be allowed for 16 hours air cooling and 8 hour water
cooling .Cooled pig will be manually sledged to remove half reacted crushed in Jaw crusher
and it will be send to GP for further crushing and grading.

2) Grain plant

 Crushing
Macro grit is the crushing of silicon carbide through different crushing such as
BARMAC, Raymond mill and other silicon carbide is crushed in to grains. Hence we
derive powder form of silicon carbide, macro grains.
 Magneting
During the process of crushing some iron particles are attached with macro grit which is
then removed through high force magnets
 Sizing
It is for grading the product. Different sizing machines are used with different openings.
 Quality control check

27
 Detailed chemical and physical analise is done to determine the iron percentage, silicon
carbide, size, magnetic, imputation and bulk density.

 Bagging
All the grits are then bagged and send to Chennai for further production. They use HDPE
bags. Paper bag used for HDPE restricted countries.

MICRO

The input of micro grit plant is the end product of the macro plant. But in this plant
the grit are imported from Russia due to finer quality and economies available

1) Jet Milling

Its operations refer to crushing using compressed air. This is an iron free grinding
process.

2) Air Classifier

With the help of air classifier product are graded.

3) Quality control check

The chemistry, size and quality of the product is checked and assured.

4) Bagging

The end production is then packed for shipping.

Bonded Grain Sizes Available

F12 , F14 ,F16, F20, F24, F30, F40, F46, F54, F60 , F70, F80, F90 , F100,
F120, F150, F180 and F22O as per FEPA ( Federation of European Producers of
Abrasives) standard 42-1:2006

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 COATED GRAIN SIZES AVAILABLE
12, 14,16, 20, 24, 30, 36, 40, 46, 54, 60, 70, 80, 80, 90, 100, 120, 150, 180 and
220as per FEPA (Federation of European Producers of Abrasives) standard 43-1:2006.

 BLACK SILICON CARBIDE MICRO

GRAIN SIZES AVAILABLE

F240, F280, F320, F360, F400, F500, F600, F800, F1000 and F1200
.

Applications are:

 Bonded Abrasives
Bonded abrasives is a matrix of closed size abrasive grains pressed together with the help
of vitrified, resinoid or rubber bonding material into a variety of shapes, like grinding
wheel, honing stone etc. The matrix is fired at high temperature to provide a high strength
bonding between the abrasive grains.
CUMI specialize in manufacturing of a complete line of closed sized abrasive grains in
various shapes, sizes and densities, etc. to perfectly fit any grinding application and
working condition.
CUMI Sharp grains are blocky sharp edges with low iron and silica content. Its high
toughness & hardness (Mohs Hardness 9), excellent abrasion resistance, high corrosion
resistance properties combined with cooler cutting characteristics, appropriate friability,
multi-fracturing properties exposing sharp edges and self sharpening characteristics makes
it an ideal raw material for the manufacturing of bonded abrasive for all applications.

Typical Applications
Ball grinding & ball lapping wheel
Rice polishing wheel
Gear grinding wheel
Cam grinding wheel
Crankshaft grinding wheel
Valve components grinding
Internal grinding wheel

29
Thin wheel
Tool room grinding
wheel Roll grinding
wheel Razor blade
wheel
Flute grinding
Bearing grinding wheel

.
 Coated Abrasives
Coated abrasives is a three component system consisting of abrasive grains adhering to the
semi-flex backing like paper, cloth, fibre, plastic film etc with the help of resin or glue
bond. Coated Abrasive is manufactured as rolls which is then converted into different
foams like belts, disc, flap disc, flap wheel & spindle mop, sheet & non- woven products.
CUMI specialize in manufacturing of a complete line of closed sized abrasive grains in
various shapes, sizes and densities, etc. to perfectly fit any coated abrasive application and
working condition.
CUMI Sharp Grains for coated abrasives are angular, sharp edged with high capillarity for
instant adhesion to resin or glue bonds and electrostatic characteristics carefully monitored
to provide consistent and reliable grain projection. The High hardness (mohs hardness 9)
and toughness of the CUMI Sharp grains combined with the multi-fracturing property, self
sharpening characteristics and cooler cutting characteristics of the grains makes it an ideal
raw material for the manufacturing of coated abrasives for any application.

Typical Applications
Coated abrasives are used by hand or on machines, applications are extremely varied, at
home and in industry for:
Fine finishes: hand sanding or polishing of wooden cabinets, car bodies primers, metals.
High precision operations: Optical lens polishing, magnetic head super-finishing.
Medium stock removal with portable or fixed machines: Floor sanding, disc grinding of
metal, endless belts grinding of wood, metal, glass.
Heavy stock removal with wide (up to 3 m) belts on high power machines to grind stainless
steel sheets or coils or to calibrate plywood or chipboard panels.

30
  Brake Lining

Brake lining are mainly composed of a heat resistant and strong fiber which are relatively
soft yet tough with high co-efficient of dynamic friction mounted to a solid backing using
high temperature adhesive or rivet. In order to increase the dynamic co-efficient of friction
and decrease the wear of the brake lining under high temperature produced during braking,
ceramic grains are added to the fiber.
CUMI Sharp micro grains with stringent particle size distribution possesses high toughness
& hardness, excellent abrasion and wear resistant and physical & chemical stability at high
temperature which makes it an ideal additive to the brake lining for higher dynamic co-
efficient of friction, longer life and hence better performance of the brake lining.

Typical
Applications
Automotive brake
Rail brakes
Air-craft brakes

 High Abrasion Resistance Coating

High abrasion resistance coating is a composite system
containing a high strength resin like epoxy and high abrasion resistance ceramic particles.
The high abrasion resistance coating is in the form of a thixotropic paste which could be
easily applied on the surface with a brush or in the form of a putty containing up to 70%
solid mass. The high abrasion resistance coating is used as a protective coating or to repair
worn areas in material handling equipment or components conveying abrasive materials.
CUMI Sharp micro grains possesses high hardness (more than 9
Mohs), high toughness, excellent abrasion resistance, high resistance to chemical attack and
corrosion. These characteristics of CUMI sharp grains makes it an ideal raw material for the
manufacturing of High abrasion resistance coating.

Typical
Applications Slurry
transport Lines
31
Agitator assemblies

32
Impellors
Ash and slurry
Pumps Shafts
Exhaust fans
Ore processing tanks
Screw conveyors
Cyclones
Pipe elbows

 Production capacity:

Production capacity of the Plant 1 is 1000 tons per month and the Plant 2 is 750 tons per
month

 Packing:
25 kg multiply paper bags of 1000 kg palletized .Other packaging types on request

Work shifts:

The company works in three shifts;

 8am-4pm,
 4pm-12am, and
 12am-8am.

ROLE AND RESPONSIBIITY OF PRODUCION MANAGER

 Responsible for managing the production staff.

 Monitoring the day today production.
 Ensuring the timely dispatch of sales vehicles.
 Ensuring quality of the product.

33
  Training newcomers on the process. Taking trials of bread and bun.
 Preparing the production report on the day today basis.

SLOGANS

 “ Improve standard of living by increasing productivity ”

 “ Wear safety gadgets in plant ”

34
4.1.b.QUALITY CONTROL DEPARTMENT
Quality Assurance Department Structure

SENIOR MANAGER QA

DM QA

SUPERVISOR

JR SUPERVISOR

TEAM LEADER

CUMI is renowned for its quality, not only in electro minerals but also in all their products
such as abrasives and ceramics. As the raw materials for producing abrasives and ceramics
are electrominerals, whose quality is very important.

Quality policy of CUMI:

“We shall proactively meet customer expectation by providing quality products and
services.”

35
This will be achieved through:

 Total commitment of the management in implementing an effective

quality management system.
 Continual technological development to fulfill changing needs of the customer.
 Total employee involvement for continuous improvement.
 Enhancing employee competence through education and training.
 Building mutually beneficial relationship with suppliers.

Responsibility of quality department is checking the quality of the raw material because;
the quality of the final product is primarily depending on the raw material.

Quality is checked during-

 Raw material is taken for the Production.

 Mixing the raw materials.
 Furnacing
 Pig yard
 Crushing.
 Before packing the final product.

There are two laboratories in CUMI for checking the quality, they are:-

o Chemical lab
o Physical lab

In the chemical lab, they check the chemical properties such as gravity, percentage of
weight of each metal in the product, fusion level, and combination of the product etc.

In the physical lab, they check the free iron, HM (hand magnet), bulk density and

size analysis.

Final checking of the product is done in the bin. Quality analyzer checks the each bin and
put a bin card. If the bin card colour is green, that bin contains the product is accepted and
that bin goes to the packing section. If the bin card colour is red, that bin contains the
product is treated as rejected. If the bin card colour is yellow, they reserve that bin contains
36
the product

37
for recycling.
They follow Total Quality Management (TQM) system for sustaining and improving the
quality of the products. The TQM values followed by the company are:

 Excellence in all aspects of business.

 Customer first attitude.
 Total involvement.
 Emphasis on leadership.
 Internal customer support.
 Continuous improvement.
 Improving quality of life of the employee and society.
 On time delivery.

CUMI maintain their TQM through various activities. These are:

5 „S Policy: CUMI adopted 5s policy for improving the quality of product and work.

1) Sorting.

 Segregate required usable re-workable and absolute item.

 Dispose off the unwanted items.
 Clear off walkways

2) Systematizing
 Use labels, colour codes for easy identification
 Use index doe files, records, drawings etc to facilitate retrieve ability
 Plan storage with accessibility
3) Shining
 Inspect the supply lines, scrap yards and gardens.
 Clear up workplace, machine and tools after use
 Identify root cause of loud noise, vibration, head noise, vibration heat buildup
in equipment and take remedial action

38
4) Standardizing
 Establish checking procedure
 Create visual control
 Device ways and means and means to expose problems

5) Self discipline
 Develop action plan for maintaining the self standards
 Give unambiguous advice

. Quality audit

A systematic and independent examination to determine whether quality activities and

related result comply with planned arrangements and whether these arrangements are
implemented effectively and are suitable to achieve objectives.

The company has been following KAIZEN Japanese scheme for continuous improvement in
all activities of the business. This scheme means that the quality of the products or services
is determined by its uses, efficiency, value for the money, comparison with other products
and some other criteria etc. These parameters are varying depending upon the situations. So
there is no proper measure to determine the quality of products and services.

ISO Certification : CUMI has got ISO 9001-2008 series certification for quality
assurance in design / development, production installation and servicing

RESPONSIBLITIES OF QUALITY DEPARTMENT

 Finished goods audit.

 Packing material checking.
 Raw material analysis.
 Finished goods analysis.
 Online checking of dividing weight
 Online checking of finished product weight
 Monitoring the hygiene and sanitation
 Monitoring workers hygiene

39
  Documenting the reports
 Damage product checking
 Production report making
 Daily production report

SLOGANS

 “It‟s an attitude to achieve perfection ”

 “Our job # 1

Customer Satisfaction ”

40
 4.1.c. MAINTENANCE & ENGINEERING DEPARTMENT

Maintenance and Engineering Services Department,

operates under certain responsibilities from which it derives its functions and commitments.
One responsibility is to ensure machine availability to ensure production as per monthly
plan. This is accomplished by ensuring minimum down time of critical and support
equipment maintaining high MTBF and Low MTTR, minimize machine downtime by
adhering to preventive maintenance as per plan

Another key responsibility is to ensure availability and quality of utility requirements

electricity, water and roads which are essential for ensuring continued and smooth
operations of the unit. All reports regarding the plant performance on utilities shall be
maintained and corresponding bills shall be verified by this department.

The department shall ensure required availability of all spares, consumables, wear parts for
critical process machinery as well as support equipment and utility facilities

Maintenance Work shop: - The maintenance work shop has the facilities for assembly of
rotatable, drilling and grinding and welding.

Department Objectives

• Ensure availability of machinery as per business plan

• Ensure adherence to performance parameter fixed in business plan

• Reduce maintenance cost

• Adherence to preventive maintenance plan

• Initiate corrective and preventive action

• Ensure availability , quality of plant utilities

• Ensure safe disposal of waste

• Ensure good housekeeping.

41
 MAINTENANCE DEPARTMENT CHART

Sr. Manager-Engineering and Maintenance

Dy. Manager- Engineering

Supervisor

Operators (Mechanical) Operators (Electrical) Trainees

Responsibilities of Maintenance Department

• Ensuring plant availability.

• Planning and adherence to preventive maintenance schedule.

• Ensuring machine parameters for optimum operation are maintained.

• Prevent deterioration of machinery condition due to non-achievement of

specified parameters.

• Execution of annual maintenance contracts.

Preventive Maintenance

As we know the famous proverb, “Prevention is better than cure”.CUMI believes in this
proverb. As per this, every Sunday maintenance operatives will inspect and do the

42
maintenance work in the whole plant .They identify some critical machines and these
machines are periodically inspected

• Prepare list of all equipment, identify Critical equipment

• Critical machinery can be identified as those machines whose improper functioning

will lead to immediate stoppage of the production module

• Master list preventive maintenance jobs to be prepared from equipment manuals and
based upon inputs from previous history break downs

. Safe work permits and checklists for PM execution shall be issued and verified by
maintenance in charges .

• A preventive maintenance planner shall be prepared based on the above.

Breakdown Maintenance:

If any break down occurs, the concerned department will sent a complaint to the
maintenance department with the help of personal computer (ERP System Ramco No 3).
Then the maintenance Dept. head issues a work order depending on the manpower
available. They will try to rectify the root cause of the break down and bring the machine to
the production process

DOCUMENTS used

 Master list of equipments

 List of critical equipment
 List of machine manuals and equipments manuals
 Annual maintenance
 Maintenance schedule

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  Preventive maintenance check list
 Safe work permits

Use of Personal Protective Equipments (PPEs):

PPEs are one of the major factors to tackle many problems. The effective utilization of PPEs
wherever required minimizes injuries. The company has adopted a strategy regarding its
usage. The management has warned the concerned employees about the consequences of not
using the PPEs. It also considers taking disciplinary action against employees failing to use
them at his work place. The important PPEs provided are:

 Helmets
 Masks
 Gloves
 Ear plugs
 Safety shoes

Slogans

 “ Energy conservation is the foundation of the energy independence ”

 “ Make every day , a safe day ”
 “ Wear safety belts when working at a height ”
 “ Look out power before starting maintenance ”

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4.2. HUMAN RESOURCE DEPARTMENT

HR Department Hierarchy

GM

HR MANAGER

DYHR
HREXECUTIVE
MANAGER

STAF
F

Human Resource Department

Human resource has always been one of the focus points in business strategy. HR

strategy is carefully linked to the vision, mission and overall business strategy of the

company. In CUMI , the HR department is responsible for putting together the HR plan

based on corporate plan. It is responsible for recruitment, selection of employees,

transfers, payroll processing, canteen, and legal proceedings.

Human Resource Planning is done with the 3+1+3 business plan (3-past 3 year‟s

performance, 1- current year performance,3-forecast of future 3 year‟s performance). The

45
company evaluates the HR requirements estimated by a series of analysis. The basic

objective of this department is effective utilization of Human Resource, desirable working

relationship among all employees and maximum individual development. The most

appreciating feature of CUMI is its profound flexibility in communication between any

subordinate and superior. This contributes to a friendlier cooperating environment. CUMI

has a group of very committed employees. It has strength of 44 permanent employees, 21

management staff, 65 non staff, 21 temporary trainees and 16 contractors.

HUMAN RESOURCE STRATEGY

CUMI‟S business strategy is evolved from Domestic and global market trends,
Economic growth competitor analysis and customer Industries‟ growth plan .HR
strategy is linked to the the business strategy and facilities organization to achieve by
building people capabilities

CUMI‟s concern for people has been driving force for the growth of the
organization over the years attribute last 5 decades. The sustained growth over the past
several years attributed to the knowledge, skills of the people and technology. HR has
been one of the focus points in the business strategy.

The HR strategy is carefully linked to the vision, mission and overall business
strategy of the company

HR Values

 Concern for people

 Integrity
 Customer orientation
 Continuous improvement
 Executive excellence

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HR Principles

 Whether workers or management staff, employees are employees. They are

not different bloc, but two faces of the same coin.
 Employee Unions are treated with respect and are partners in the progress.
 Harmony and peace cannot be at the cost of dilution of organization
ethos. Fairness and firmness will govern all employee relations.
 Communication and dialogue would be the essence of managing relationships.
 A proactive approach and a state of mental and physical preparedness would
help in managing unpleasant issues.

HR Functions

 Recruitment & selection.

 Preparing appointment letters.
 Arranging training and development programs for the employees.
 Keeping all statutory obligations.
 Collecting data from all other factories to enable them prepare details for
long term negotiation.
 Informing the concerned department about the change of factory rules &
other related acts.
 Maintaining strict discipline.
 Making daily attendance of the employees, pay and overtime, this department
also does all correspondence relating to the ESI and PF.
 Running of canteen

. Recruitment & Selection

Recruitment and selection is based on integrity, competency and the ability to work in a
team. Company takes value fit individuals with group into consideration. Individuals
are placed under 1 year probation in which the superior accesses his/her abilities,
teamwork, and performance in pressure situations. But successful completion of
probation does not imply on assurance for permanent employment. Based on
experience and qualification selection of managers is done at the Head office, Chennai.
The management gets people through campus recruitments, personal references etc.

47
The selection procedure consists of:

Aptitude Test

Group Discussion
Personal Interview
Medical Checkup
Final Interview

Line managers are expected to prepare job description and job specification in respect of
job to be filled, HR department is expected to oversee and ensure proper compliance
with statutory and organizational requirement and policies. The recruitment process is a
three tier method-direct, indirect and third party. The sources of recruitment included
both internal & external. The internal source includes transfer and promotion, which is
more preferred by the company. The management chooses external source like campus
recruitments, personal references etc.

Induction

The workers are recruited and selected is given an individual program; introducing
them to the plant, their work and to the concerned department. For managerial
personnel, the induction method used is apprenticeship-training method; immediate
supervisor trains employees. For workers shop floor training is given. There is three
level of induction at CUMI:-

 Corporate induction: mainly for corporate personnel. Given in Head Office (Chennai).

 Induction across unit: Given for management staffs across the units in order to
know the various dynamics exist in the group.

48
  Department/functional unit induction: This is given for both management and
non- management staffs; each department managers or supervisors give this.

Training and Development

The need for training is determined by identifying the gap between present performance of an
employee and the desired performance. In CUMI, it is done on the basis of skill matrix.
Training needs identification procedure:

Business Plan/ Long Term Strategy

Policy Deployment

Skill matrix for operatives/ Competency

requirement for managers
Competency gap

Training need identification

Skill Matrix:

The objective of the skill matrix is to have a scientific analysis of skill level. The aim is
that technology changes fast and new technology demands new skill. Therefore, this
helps employees to progress his career plan. Skill matrix measures five aspects of an
individual/personal characteristics, discipline, skill work performance and participation
in management. The skill matrix is to find out the attitude of individual towards work
and

49
 the skill of the person to perform. It is to identify scientifically the skill level existing in
the organization and to develop the skill levels pattern to meet the business
requirements. In skill matrix, the department head and the employee are rated based on
certain parameters. In rating the performance, it is classified into three -good
performance, average performance and poor performance.

Training for Management staffs

 Two functional and one Personal Effectiveness Training Program as a part

of corporate initiative.
 Specific program against the requirement- Division/unit HR.
 Advanced TQM orientation
 Negotiation skill.
 Out bound training.
 SHE programs.

Training for non-management staffs

 Behavioral training
 Skill improvement training
 Multi tasking
 Process orientation
 Energy management conservation
 TQM orientation

The funded needed for training both management and non management staffs is been
provided from the head office .the evaluation of training through an ERP software
called RAMCO. The performance of the employees evaluated every month through this
software. Based on the performance level they can know the effectiveness of the
training programs

50
 CUMI‟s policy on HRP

CUMI will recruit based on integrity , competency and the ablility to work in a team.
We would also endeavour to select individuals with leadership potentials, customer
orientation and quality focus. Above all, we also take the value-fit of the individual with
the group in to consideration.

POLICY AND CARRIER PLANNING:

CUMI believes that its our responsibility to develop employees to their potential so that
the future challenges could me met with existing talent

DEVELOPMENT PLAN

The 3 C‟s of retention of talent at CUMI

 Challenge
 Compensate
 Competency
 Areas-operational /cultural excellence

Performance management system

 The performance management system is based on the score card.

 The balance score card is the culmination of the business plan and is the complete
strategic map which identifies the strategic indicators and thrust areas of the
business. This balance score card is the authentic document approved by the
Murugappa Corporate Board. Based on the approved score card the functional score
card are evolved.

 The monthly plans are then evolved from the above. These plans are reviewed on
a monthly basis against the plan.

51
 The feedback and the learning‟s from the monthly reviews and course corrections
are incorporated.

 The Performance Management System is on line with Policy Deployment.

 The system is designed to capture the objectives and measures in the

policy deployment table drawn up for the current year.

 The objectives and measures are to be clear cut, specific and quantifiable.

 The appraiser and the appraise will jointly discuss and arrive at the best
regrouping possible of the objectives.

 In the discussions, the appraiser and the appraise agree on a action plans including
resources and support. This is summarized and signed off by both the appraiser &
the appraise.

 A review mechanism is also built in the system to ensure frequent monitoring of n

and course correction, if necessary.

 The review calendar is drawn up to regularly monitor the progress of the

objectives and provide resources if any on the part of the appraisee

 Control charts are maintained at agreed frequency and reviewed.

COMPENSATION

CUMI believes that compensation should be based on the individual performance is

classified through quantifiable/objective. The performance rating will be:

 Exceptional contribution

52
  Significant contribution
 Good contribution
 Not meeting the requirement
 Not suitable

PERFORMANCE LINKED INCENTIVES:

The incentive, a part of the compensation and linked to balance Score Card helped CUMI,
iniative process of :

 Rewarding stretch effort and risk taking

 Encouraging inter functional and organizational perspective
 Providing trust to sustainable processes
 Giving inputs to innovation and learning

Incentives are an important and integral part of the compensation package. It would be
based on the achievement of the company/ SBU Score Card, with age specification for each
perspective

REWARDS AND RECOGNITION

CUMI has evolved a rewards and recognition scheme.

Kaizen Scheme: The objective of the scheme is to encourage and recognize management
staff for their participation and contribution in work /method/productivity improvement and
cost reduction exercises which benefit the organization.

This scheme is applicable to all management staffs up to MG6 including management

trainee category of CUMI for their individual contribution.

Suggestion Scheme: The objective of the suggestion scheme is to encourage and recognize
employee for their participation and contribution in work/method/productivity
improvement and cost reduction exercises which benefit the organization . This scheme is
applicable to all operatives of CUMI for their individual contribution

53
AREAS OF SUGGESTIONS:

 To improve production or productivity

 New methods or devices improvement for simplification
 To improve quality of product or maintenance of services
 To improve general; upkeep and cleanliness
 To eliminate wasteful practices
 To eliminate pilferage of materials
 To improve process
 To reduce cost

Performance appraisal

The methods used in CUMI are supervisory rating and self-rating. Performance
appraisal for the managers is called Policy Deployment. This system is based on factors
like business result, quality systems, total employee involvement, waste elimination and
customer satisfaction etc. In this system, the objectives of the GM will be the measure
of his next subordinate and this flow down accordingly until the final objective is
attained. The Performance Management System is based on the Balance Score
Card .The Balance scorecard is the culmination of the Business Plan and is the complete
strategic indicators and thrust areas of business. Appraisal for staffs consists of
knowledge of methods and procedures, quality of work, attendance and punctuality,
resourcefulness, good manners, team spirit etc.

Promotion Policy

Suitability and merit with number of service years are the criteria for promotion.
Promotion policy has been drawn taking into consideration of performance and
seniority.

. Workers participation in management

CUMI takes suggestions from employees mainly relating to the cost reduction. The better
suggestions will be considered by the management and rewarded properly.

54
Salary payment

CUMI paying salary to employees through SBI Bank on 7th of every month .

Welfare Measures

 Welfare Fund: Employees will contribute Rs.39 per month to the welfare fund. If
the employee is sick for more than two month, Rs.1400 will be granted. In case of
serious accidents or death, entire amount will be borne by the company. Cash award
will be given to the children of employees who secure highest marks in the SSLC
exam.
 Medical Scheme: Staffs who are not under the E.S.I scheme can avail this scheme.
The scheme is to provide financial assistant to the employees who have crossed the
ESI.Act and is not entitled for any other benefit from any other scheme. The ceiling
amount of this scheme is Rs.25000, amount will be granted only for inpatient
treatment. For out patient treatment amount within Rs.1800 will be reimbursed.
Three other members in the family can avail this scheme.
 Recreation Club: CUMI has a library, there is a wide collection of novels and
other books, Television, newspapers ,company magazine (CONNECT) etc. Club
conducts sports and games. The club also conducts family tour programmes every
year. The club also celebrates annual day (which will be Dec/Jan) and Onam
festival.
 Canteen: CUMI has a subsidized canteen. Monthly Rs.18 is deducted from
every employee towards canteen. The company appoints suppliers and they are
nine in number. Purchase regarding the canteen is done by the company itself.
 Dispensary: First aid is given in case some accidents happen. A register is
maintained in the dispensary and some of the medicines are stocked. There is no
permanent doctor, but only a visiting doctor who comes every three days in a week
and one compounder. Periodical medical check up is conducted in the dispensary
and the employees are given an amount as medical allowance. The employees are
insured under a group insurance scheme.
 Uniform: Company provides uniform and foot wear to the employees every year.
For those who work in plants three pairs of uniforms and a pair of shoes will be

55
given once in a year. Those who work in sledging division in every 4 month a pair of
dress

56
 and shoes will be given. The company also pays Rs.110 towards stitching charge.
Both the management and operative staffs in CUMI has the same uniform.
 Birthday celebration: The Company celebrates the birthday of their
employees. Company gives a pack of sweet and a birthday cards to the concern
employee.

 Allowances:
⭢ Washing Allowance
⭢ Shift Allowance
⭢ Travel Allowance
⭢ Educational Allowance
⭢ Attendance Bonus
⭢ House rent Allowance
⭢ Feeding allowance
⭢ Festival Allowance.

Grievance handling

Company policy:

Redressal of day-to-day grievances can motivate employees to be more effective.

Grievances should be settled reasonably, swiftly and transparently.

Welfare benefits:

Welfare fund:

Management agrees to contribute towards employee‟s welfare fund at the rate of Rs.15.00
– 20.00 month with effect from 1st September, 2006.

Advances:

Management agrees to increase advance from Rs.5750.00 to Rs.7500.00 per

annum, which is to be paid in three installments of Rs.6000, Rs.3500 and Rs.1000
as Onam advances and school advances and special advance respectively.

57
 Safety shoes:

Additional one pair of safety shoes per year to plant operatives considering safety
requirements.

Leaves:

(a) Earned leave - strictly as per factory act

(b) Casual leave - Maximum 13 days per annum
(c) Medical leave - Maximum 12 days per annum

Hospitalization schemes:

Scheme for employee‟s, spouse children. Introduced for those employees who are out
of purview ESI scheme consequent to exceeding the prescribed salary limit of Rs.10,
000

Tour subsidy:

The annual tour subsidy is revised from 5,500 to 10,500. Terms and conditions
unchanged.

Wages and allowance:

Applicable to all permanent employees with effect from 1st September, 2006

Dearness allowance:

DA is revised from Rs.4.35 to Rs.4.78 per point over and above 83 points of the
consumer price index (1970=100) published by the Director of Statistics, Kerala for
Ernakulam.

House rent allowance:

The house rent assistance is revised from Rs.390.00 to Rs.554.00 per month

58
Conveyance allowance:

The conveyance allowance is revised from Rs.355.75 to Rs.523.75 per month.

Night shift allowance:

Revised from Rs.10.00 to Rs.15.52 per shift for those who work between 4 pm and 12
midnight shift.

Revised from Rs.13.00 to Rs.19.88 per shift for those who work between 12 midnight and
8.00 am

Attendance bonus:

An amount of Rs.50.00 per month will be paid to eligible employees in addition to the
present practice of paying one day basic pay as attendance

Incentives:

Normal maximum amount earned for good performance per month is Rs.660. variable
pay base on 3 criteria namely process criteria, company criteria and individual criteria.

Overtime:

Overtime allowance is given to the workers on the basis of mass hours.

Overtime=Basic+ DA *attendance hours/240

. Trade unions

 Carborundum Labour Union

 Carborundum Employees Union

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 Industrial relation

In CUMI, the HR department plays a vital role in maintaining harmonious industrial

relations. A very good relationship exists between the management and the employees.
Since1987, no strike were reported. Inter as well as intra union rivalry is very low.

Slogans

 “ Energy is the power that drives every human being to triumph ”

 “ If you cannot measure it , you can not improve it ”

60
4.3. ACCOUNTS DEPARTMENT

ACCOUNT MANAGER

ASSIST ACCOUNT

STORE SUPERVISOR

The main finance department is the main branch at Eadappally. It prepares trail balance,
MIS and audit report. The financial department uses Ramco Virtil Works (RVW).

The accounts department does book keeping, accounting and reporting functions. It
undertakes the work of pay sheet preparation of staffs and workers, payment of bills,
vouchers and other financial transactions. They also prepare financial reports of the
company. All the major financial decisions are taken at corporate office (chennai). This
department also keeps income and expenditure accounts, which includes the sale and
disposal visible cost, contribution, fixed overheads, operating and non-operating income etc.

The corporate office provides funds for working capital requirements. Departmental
budgeting is also the function of accounts department.

Duties of accounts assistant is cash transactions, accounts payable, payment of tax. Trial
balance, capital expenditure are maintained by supervisor. Responsibilities of the manager
a/c are making monthly report, auditing and fund management etc. AGM a/c has the full
responsibilities of accounts department.

Major functions of this department are:

 Keeping depreciation account.

 Preparation of income and expenditure account
 Preparation of budget for three years.
 Departmental budgeting

61
  Prepare management reports
 Coordinating the auditing functions
 FIFO method used to dispatch stock
 Spare part planning undertaken
 Item wise accounting and control of various inventory items
 Responsible for purchase of mechanical spare

Capital structure:

CUMI‟ capital structure consists of equity share capital, preference share capital, reserve
and surpluses, long-term loan, other loan and deferred tax liability.

Sources of funds:

CUMI‟s main source of fund is from the corporate office (Chennai).Issuing of share and
short-term loans from the company‟s consortium of banks like State Bank of India are
the other source of funds.
Earnings from the operation:

Last year company‟s operating profit and profit before interest and tax (PBIT) were 13.93
crore. In addition, the net profit was 5.55 crore.

Future investment proposals:

CUMI‟s investment proposal is 1500 lakhs for capital planning. It includes 100 lakhs for
mine purchasing, 500 lakhs for the application of tilled furnace, 500 lakhs for the large-
scale production of semi friable products and 400lakhs for miscellaneous.

Every 3rd of the month cash flow statement, Flash Report consisting of sales contribution,
contribution percentage, fixed expenditures, Profit before Interest and Tax (PBIT) and 8th of
every month Management Information System of profitability and Capex progress, Balance
Sheet statements are sent to Corporate Office.

62
Accounting policies:

The company policy has a special accounting policy, which is the basis of the financial
statement. It is in accordance with the accounting standards issued by the Institute of
Charted Accounts of India.

Deferred revenue expenditure:

Preliminary expenses are amortized over a period of 5 years.

Revenue recognition:

Both income and expenditure are recognized on accrual basis. At the end of the accounting
period, works in progress are recognized as revenue based on proportionate completion
period.

Foreign currency transaction:

Transactions of foreign currency are recorded at the rates of exchange prevailing on the
date of transactions and the exchange loss or gain is recorded within the profit and loss
account.

Depreciation:

Earlier days Company adopted Written down Value Method. However, the management
felt that straight-line method would be more appropriate. So from 2000 onwards they
adopted Straight Line Method.

Investment:

It is meant to be held for long term is accounted at cost.

Fixed assets:

Fixed assets are stated at a cost of acquisition and subsequent improvement thereto
inclusive of taxes, dues, freight, and other incidental expenses related to acquisition,
improvement and installation.

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Borrowing costs:

Borrowing costs are capitalized as part of qualified fixed assets when it is possible that they
will result in future economic benefits.

Inventories:

Inventories are valued at lower of cost and net realizable value. Cost includes all direct
costs and applicable production overheads to bring the goods to the present location and
condition. Excise duty on the finished goods is added to the cost.

The company also holds a special Murugappa economic value added method for
better operating profit, faster sales growth reduction in incremental fixed capital,
reduction in effective tax rate and lower WACC.

Retirement Benefits:

The contribution of gratuity fund is based on an annual valuation and to the superannuation
is funded to LIC of India.

Capital structure:

CUMI‟ capital structure consists of equity share capital, preference share capital, reserves
and surplus, long-term loan, other loan and deferred tax liability.

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STORE

The main function of store is procuring the raw materials and other required materials for
the company. This department invites quotation from various suppliers and make a vendors
list on the basis of some criteria.
This department also rates the each vendor based on their previous experience, quality of
the product, delivery speed and price, which is called vendor rating.

This department issues materials as per the order given by the concerned department
through material requisition. If the required material is out of stock, the commercial
department head invites quotations from the vendors. The best quotation is chosen and the
purchase order is placed. On the arrival of the material, it is checked and issued to the
concerned department.

Purchase procedure:
Purchase request

Authorization

Quotatio
n
Takes the least quotation
Planning Purchase order
Material collection

Inspection of material

Payment for the material

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Purchase request: If the departments require any materials, they will place a material
requisition to the commercial department. If the required material is not in the store, the
store manager places a purchase requisition (PR) to the plant manager.
Authorization: Purchase requisition is checked by the plant manager and approved for the
quotation.
Quotation: Department invites the quotations from the vendors.

Takes the least quotations: department selects the least quotations

Purchase order (PO): department takes the least quotations with the consideration of
their previous experience, quality of the product and delivery speed then placing a
purchase order to the appropriate vendor.
Material collection: When the materials are reached to the company, the store
supervisor inspects the materials and then issued to the concerned department.

Store:
The main raw material are quartz and raw petroleum coke supplied mainly by Tamil nadu
and Gujarat . The company is considering purchase from other sources also. Every item is
attached with a „Bin Card‟, which has UNIQUE CODE NUMBER consisting of 14 digits.
The card has description of the item, date of receipt, date of supply, balance, signature,
remarks and stock number.

66
4.4. SHIPPING DEPARTMENT

GENERAL MANAGER

SENIOR
MANAGER
SHIPPING
JUNIOR OFFICER SHIPPING

TRAINEE
S

Arrangement of movement of material. Marketing material is not undertaken here. This

department also maintain stock of finished goods.

3Types of dispatches

 Captives dispatch(Branch Transfer about 50% )

 Domestic Sale(with India)
 Exports

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Functions of shipping department

 Customer interaction, customer visits, quotation preparation and

submission undertaken by department
 Order receipt and order acknowledgement onwards entails responsibility of
shipping department
 Transporters are employed as they absorb liability in relation to vehicles and drivers
 Invoice, Gate pass, Declaration in 8f and Lorry receipt are to be maintained
for domestic sale
 The transportation of domestic and captive sales is arranged by shipping
department as per the customer authorized transporter
 For export CUMI arranges containers for house stuffing at Koratty plant as per
the supervision of central Excise officer
 Stuffing report, Commercial invoice are document maintained for export.

This department is responsible for the packaging of finished products. They start dispatching
only after getting the green card from the quality control department. This department has
also the responsibility to determine the number of casual workers required for the loading
and unloading function. However there is a forklift to do major part of the loading work.
This department also in charge of preparing invoice.
Then it is packed in various quantities. In every shift 210 bags weighing 50 kilograms
(domestic purpose) and 25 kilograms (export purpose) is packed. The bags are placed in
pallet and lifted by Crain and taken to separate area from where trucks carry it to
destinations.

Main customers:

The main customer industries of the CUMI are:

 Automobile industry.
 General metal cutting industry.
 Polishing of metal surfaces.
 Marine paints etc.

68
And the main customer companies are:

 Vishwa vishal.
 Mechans in UK.
 Milthon
 Indoflogates.
 Tata refractories.

Branding:

CUMI made its brand well known in the industry through continuous hard work and
determination. This was possible because of the following reasons:

 Consistent high quality and reliability

 Fair pricing practices and transparency
 Relationship management
 Customized product variants

Sales:

Ninety percentage of the sale is done through direct orders from the customers and 10
percentages is from the dealers. Last year the company‟s domestic sale was around rupees
42.35 crore and the export sale was around rupees 9.5 core.

Distribution:

CUMI has no formal warehouse. They distribute their products directly to the consumers.

Pricing strategy:

In the domestic market, the company sells products at premium price. However, in the
export market the company facing great competition from the Chinese products so in this
market the company sells the products at economic price.

Promotion:
Promotion is done using the broachers, brand name, technical journals, and magazines,
yellow pages of the internet and relationship management.

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Competition:

Price and quality are the major competitive parameters in this industry. In the domestic
market, company divides the entire market into four regions i.e. north, west, south and east.
Each manager is being responsible for sales in the particular region. Last year the
company‟s domestic sale was around 42.35 crore. In the Indian market, 35 % of the share is
from CUMI. The main competitors of CUMI are Graind well Norton, Snam abrasives and
Orient abrasive
.In the export market, the company focuses on Germany, Philippines, Italy, Spain, Saudi
Arabia, Japan, UAE, USA, and South Africa.

70
4.5 .SYSTEMS DEPARTMENT

G
M
System Administrator

System Operatives System Operatives

System Operatives

The electro minerals division at Koratty is becoming more automated and technocracy.
In this company, each department uses computer and is interconnected with the help of
ERP (Enterprise Resource Planning) system.

Ramco Virtual Works, a Chennai based software company provides ERP solution The
company uses ERP because it provides:

 Integrated market information.

 Better handling of raw materials
 Better process control
 Reduce the time and cost
 To record the details of HR
 Integrated financial information

The company‟s entire work, raw materials to marketing of the finished good is influenced
by the ERP. If any department is facing any problems, that information will spread to the
entire organization and then the concerned person or department will approach and solve
that problem within the shortest period. These are done with the help of ERP.CUMI has
internet, which is easily accessible. The type of net work is used by the company is Star
Network.

71
Office automation facilities are provided by Ramco Virtual Works. It is Chennai based and
perform the activities like Payroll service, shipping and updates etc.

Type of server –

Exchange server for mail transcription. Front –end sever is based on Chennai and the back-
end in CUMI, Edappally. Internet connectivity-Broad band-256kbs.Types of operating
systems are used by the company is Windows 2003 and Windows professional.
Security systems

1. E Scan - that act as an anti virus

2. Fort guard - This blocks the unwanted websites.

URL : http://tvtnet/cumiweb/intranet/home/index.html

IP ADDRESS : 121.243.115.163

WEBSITES
http://www.cumi-
murugappa.com/ www.cumi-
emd.eu

72
CHAPTER 5

SWOT

ANALYSIS

73
SWOT ANALYSIS

STRENGTH

 The company provides value for money to the customers through their better
quality and innovative products.
 The company treats customers with respect and concern
 The company has got strong R& D department, which have a policy that 6% of total
sales every year should be from new products. R &D enables the company to have
an edge over competitors in the new product development.
 The company has got professionally managed sales team with strong back up
of reputed dealers.
 ISO 9001: 2008 certification also helps in obtaining some orders as well
as maintaining the standard of the company.
 The greatest strength of the company comes from the employees who are efficient,
energetic and sincere. Dynamic top level management backs them. There is no
barrier between management and workers.

WEAKNESS

 The salinity of water has to be improved.

 .The roads within the company are to be developed so that men and materials can
be moved easily.
 Promotion is based on the seniority not on performance

OPPORTUNITIES

 The company can introduce more of its products in the market.

 The company can produce new and improved products with less labor and
advanced technology.
 More mines have to be found out.
 Globalization and liberalization can make its products globally acceptable.
 The company can employ best brains from top business and technical institutions
for better working and management.

74
THREATS

 CUMI faces stiff competition from world majors and local players.
 Power and other equipments are expensive.
 The demand for abrasives has fallen down because of industrial and
economy slowdown.
 European financial crisis .

75
CHAPTER 6

CONCLUSION

76
FINDINGS

 Has a good organizations structure and management system

 Provides better working conditions to workers
 Growth possibilities
 Adequate storage facilities
 Experienced employees
 Monopolistic nature in Kerala
 Effective incentives system

77
CONCLUSION

CUMI is an ISO 9001 :2008 certified company. It is an excellent employer and producer of
world class abrasives and refractory‟s. This has happened only with the support of staffs
and workers in the company. The management is dynamic and supportive and patiently the
worker‟s voices and acts accordingly.

For my study I visited Plant I producing silicon carbride and interacted with some of the
employees there. I could also interact with management staff who provided me with
adequate knowledge regarding various departments in the company . All the staff are very
co-operative
. The study has helped me to know the objectives, vision and mission, values , rules and
regulations followed by the company. Company follows Japanese concept of
housekeeping
- 5S programmes .

The privileged opportunity of doing four weeks long organization study proved out to be
highly beneficial in the learning point of view. It gave a practical knowledge about the
nature of the business firm and it had enabled me to have an exposure to the majority of the
topics related to company functioning, structure , policies , promotional activities , working
environment, organizational culture etc. It has also helped me to acquire the practical
application of the theories studied in the class room ..

78
APPENDIX

79
 BALANCE SHEET
(standalone )

BALANCE SHEET (Rs. In million)

As at
As at
31.03.2012 31.03.2011
EQUITY AND LIABILITIES
Share holders ‘s Funds
Share capital 187.40 186.94
Reserves and Surplus 6178.54 5095.30
6365.94 5282.24
Non current liabilities
Long –term 558.48 1163.78
Borrowings 425.30 420.58
Deferred tax liabilities
983.72 1584.36
Current liabilities
Short – term Borrowing 409.34 482.72

Trade payable 791.30 834.59

Other current liabilities 1206.58 1110.42
Short term provisions 246.62 138.89
2653.84 2566.62

Total 10003.56 9433.22

ASSETS
Non current assets
Fixed assets
Tangible assets 3822.35 3690.44
Intangible assets 30.94 41.68
Capital work –in- progress 272.54 142.16
Non – current investments 1245.68 1640.56
Long – term loans and advances 257.96 186.86
5629.47 5701.70
Current assets
-
Current investments 100.00
1548.04
Inventories 1876.88
Trade receivables 1847.16
1772.18

Cash and Bank balances 104.23 78.16

Short term loans and advances 445.82 333.14

80
 4374.09 3731.52

Total 10003.56 9433.22

81
BIBLIOGRAPHY

REFERENCE BOOKS
 L R Potti: Research Methods, Yamuna Publication

 P.C. Tripathi, P.N. Reddy: Principles of management, Tata McGraw Hill, 2nd
Edition, 2001

 Philip Kotler, Gary Armstrong: Principles of Management, Tata McGraw Hill,

2nd Edition, 2001

JOURNALS
 Company magazine ( CONNECT)
 Brochures and Leaflets published by CARBORANDUM LTD

 Annual report

WEBSITES
http://www.cumi-
murugappa.com/ www.cumi-
emd.eu

82