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MOHAMMAD ALI JINNAH UNIVERSITY REPORT ON HR OF PAK SUZUKI PVT.

LTD AN EFFORT BY: ABID ALI & USAMA RIZWAN COUSRE: INTRO TO HRM A SUBMITTED TO: MS. UZMA KHAN

MILESTONES
1983 Aug Pak Suzuki Motor Company Ltd (PSMCL). Established as a joint venture between Suzuki Motor Corporation of Japan (SMC) and Pakistan Automobile Corporation (PACO) Govt. of Pakistan. 1984 Jan Started commercial operations with start of Production (S.O.P.) of Suzuki FX. 1988 Apr S.O.P. of 1000cc, SWIFT car later on called KHYBER. 1989 Mar Foundation stone of PSMCL Bin Qasim Plant was laid by the then Prime Minister of Pakistan, Mohtarma Benazir Bhutto. 1990 Mar Start of operation of the first phase of the new plant at Bin Qasim with engine and transmission assembly. 1992 Jun S.O.P. of MARGALLA at new Plant. Sep SMC Acquired additional 15% shares from PACO enhancing its shareholding to 40% and taking over the management. 1996 Jun The Company set-up wastewater treatment plant to control environmental pollution. Jul The joint venture agreement between SMC & PACO ended, PACO divested its entire share holding to SMC, raising SMC`s equity to 73.9%. 1997 Aug S.O.P. of 1300cc BALENO replacing Margalla. 2000 Mar S.O.P. of 1000cc CULTUS replacing KHYBER. Aug S.O.P. of 1000cc ALTO. 2001 May CNG version of MEHRAN launched. Sep CNG version of RAVI launched. Dec CNG version of BOLAN launched. 2004 Jun New plastic injection molding shop commenced Operation. 2005 Mar Capacity expansion up to 80,000 vehicles per year completed. 2006 Jan Capacity expansion up to 120,000 vehicles per year completed. Jan S.O.P. of 1300cc / 1600cc car LIANA replacing BALENO. 2007 Feb 3 phase of capacity expansion up to 150,000 vehicles per year completed. Oct Amalgamation of Suzuki Motorcycle Pakistan Limited into Pak Suzuki Motor Company Limited. Mar 120 acres of new land acquired for further expansion adjacent to the current plant. 2008 Mar The Company started exporting of Suzuki LIANA to Bangladesh. Mar Pak Suzuki acquired a land measuring 25.22 acres at Lahore, For the purpose of setting up PDI Centre, Spare Parts Warehouse, Regional Office and other related facilities.

INTEGERATED MANAGEMENT POLICY:


Pak Suzuki is built on the idea of a responsible corporate citizenship thereby managing environmental, safety & occupational health matters as an integral part of our business. In fulfilling this responsibility, Pak Suzuki adheres to the following principles: 1. We are committed to provide top quality products to the satisfaction and requirement of our customers. 2. We conduct our operations in compliance with applicable environmental, occupational health & safety laws and regulations. Even where existing laws & regulations are not adequate, we undertake to operate in a responsible manner by assuring the HS&E integrity of our processes and facilities. 3. We recognize the interrelationship between energy and the environment, and we promote the efficient use of energy throughout our system. 4. We ensure safe disposal of waste generated from our facility. 5. We minimize the discharge of waste materials into the environment by utilizing responsible pollution control practices. 6. We will continuously seek opportunities to improve our adherence to these principles

MANAGEMENT

BOARD OF DIRECTORS Mr. Hirofumi Nagao Mr. Satoshi Ina Mr. Hidekazu Terada Mr. Jamil Ahmed Mr. Mumtaz Ahmed Shaikh Mr. Kenichi Ayukawa Mr. Muhammad Razi Uddin Monem CFO & COMPANY SECRETARY Mr. Abdul Hamid Bhombal

Managing Director & CEO Deputy Managing Director Director Director Director Director Director

PAK SUZUKI VISSION N MISSION

VISION

To be Excellent All Around.

OUR MISSION

To provide automobile of international quality at competitive price.

To improve skills of employees by imparting training and inculcating in them a sense of participation.

To achieve maximum indigenization and promote the automobile vending industry.

To contribute to Pakistani society through development of industry in general and automobile industry in particular.

EMPLOYEE SELECTION PROCESS OF SUZUKI LTD.


EMPLOYEE SELECTION REQUIREMENTS:
* Mechanical * Electrical * Electronics Pak Suzuki Limited has established itself as a major player in the transport in Pakistan with a goal to become one of the biggest players in the region. It has two processing plants and is currently expanding into the world of moving day by day The Graduate Trainee Program at EPL, provides young graduates with a great opportunity to learn and grow! Trainees undergo extensive on the job training and experience different challenges throughout the program. THE IDEAL CANDIDATE WILL: * Have a positive attitude and good communication skills * Be a team player and have good interpersonal skills * Have a GPA of 3.0 or 70% marks * Either be a Fresh Graduate or with experience of not more than one year * Not be more than 28 years of age at the time of application * Be willing to relocate

TEST CONDUCTED :
TECHNICAL TEST CONCEPTUAL TEST PHYSICAL TEST HEALTH ASSURANCE TEST CRIMINARY RECORD TEST SELF-ASSESTMENT TEST PSYCOLOGICAL TEST

INTERVIEWS CRITERIA:
QUALIFICATION OBSERVERS REFRENCE CHECKING EXPERIENCE INTERACTION TOWARDS JOB

INTERVIEWING PANNEL:
HR DEPARTMENT MEMBERS CONCEREND MANAGER OF THE JOB DEPARTMENT SUZUKI SELECTION TASK TEAM FOR MANAGERS,ASST.MANAGERS SELECTION

EMPLOYEE TRAINING

IN HOUSE WORKSHOPS :

Suzuki provides training to its employees through providing in house workshops. The employee who are newly orientated in the organization and are in need of training are subjected to these workshops where they seek knowledge from the seniors and go through their training needs

SIMULATION TRAINIG :

Suzuki LTD provides simulation training to its employee in whom they provide an almost realistic project based on 3D or JAVA application that provides newly employee to enhance their abilities, as they want to create themselves.

EFFECTIVE LECTURES:

The MANAGERS or CEO of Suzuki LTD arranges lectures and seminars in which all the employees are subjected to gain beneficial knowledge. From the middle level to the lower level of organization, they arranged these lectures for all.

VISUAL BASED TRAINING:

These trainings are referred to the senior employees who are working for many years and need short training to refill their job gaps.

OUTSIDE TRAINING:

employees are sending to the main workshops located in JAPAN, KOREA, and INDIA to enhance their abilities as the technologies changes through out the world as the passage of time.

SUZUKI EMPLOYEE APPRAISING AND REWARDS


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IN HOUSE ACTIVITES:

These activities are provided by PAK SUZUKI to the employees who are know how to efficient in their work so PAK SUZUKI take a step forward towards PAPER LESS OFFICE.

VENDOR ERP TRAINING:

PAK SUZUKI implemented new ERP SYSTEM from January 2009. refreshers ERP trainings was held for vendors at KARACHI & LAHORE. Vendors are trained about the new system of organization. A team of PAK SUZUKI MOTOR COMPONY from SCM MHD and IT specialist explain the queries of vendors.

PAK SUZUKI SPORTS FESTIVAL:

Indoor sport festival of table tennis and badminton was held at PAKISTAN SPORTS BOARD COACHING CENTER for the innovation and motivation of the employees. PAK SUZUKI SPORTS FESTIVAL 2009 (INDOOR GAMES) With a slogan, To Enhance The Spirit Through Sports Activities, Pak Suzuki Sports Festival 2009 for indoor games (Table Tennis Badminton and Basketball) started on July 26, 2009 and reached its climax on August 16, 2009 at Pakistan Sports Board Coaching Centre. Large number of participants and spectators enjoyed the event and regrouped their energies for the betterment of Company. Prize Distribution Ceremony was also held at venue on final day. Pak Suzuki Management including Mr. Satoshi Ina (Deputy Managing Director), Mr. Abdul Majeed Sheikh (Director Operations), Mr. Koji Tanaka (Sr. GM-Material Control), Mr. Takashi Takada (SGMProduction), Mr. Nobutaka Suzuki (SGM-Marketing), Mr. Arif Shabbir (SGM Quality Assurance), Mr. Jawed Ahmed Warsi

(GM-Aftersales), Mr. Ejaz Ahmed Malik (SGM- Safety & Security), Mr. Ghulam Farooq (SGM-Production Control) and Mr. Kavi Raj Lala (SGM- Marketing MCD) graced the occasion with their presence and distributed prizes and certificates among the winners and runner ups.

WORK SHOP ON EFFECTIVE MANAGERIAL SKILLS: I n t h e s e r i e s

of management & development program a two-day workshop was arranged by HR dept. pronounced trainer RAHEEL NAREJO of NAREJO HUMAN RESOURCE LTD. held this workshop.

Prior to employing Oracle, Maruti used a number of homegrown systems to manage its various lines of business. Many of these disparate systems could not talk to each other, requiring staff to enter data multiple times and consolidate information to generate management reports. o The addition of four new business sectors in 2002 created further pressures, requiring constant monitoring and human intervention to keep the system operating across the hundreds of locations Maruti serves within India. To support this growth and improve efficiency, the company decided to revamp its information technology systems to provide end-to-end visibility into the organization. o o The problem with using multiple systems to manage finances was the lack of control over processes and information quality. Each office followed different workflows, which often meant one division lagged behind another in delivering information. Differing data formats required tedious consolidation, preventing real-time access to critical statistics.

INTRODUCING ORACLE SOFTWARE:

SUZUKI AND CSR:

DONATION OF BLANKET:

On 14th November 2008 Mr. Hiro Fumi Nago MD & CEO of PAK SUZUKI met Mr. NAWAB ZULFIQAR MAGSI governor of BALOUCHISTAN and presented blankets for 2400 families for the victims of earthquake

AIDS FOR EARTH QUAKE VICTIMS:

ON November 28 2008 MR.HIRO FUMI NAGO MD & CEO of PAK SUZUKI met MR. ABDUSATTAR EDHI at head office KARACHI and donated relief items for more than 250 families.

SERVICE TECHNICIAN SKILL CONTEST:


This was contest was held at 12 June 2009 in which employee has taught the environment about their SUZUKI VISSION AND MISION in the campaign manner

PAK SUZUKI MOTOR COMPANY LIMITED - Analysis of Financial Statements FY 2002-2006


OVERVIEW (August 23 2007): Pak Suzuki Motor Company Limited was incorporated in August 1983 as a public limited company. Its shares are listed on all stock exchanges of the country. The company is a joint venture between Pakistan Automobile Corporation Limited and Suzuki Motor Corporation (SMC), Japan. PSMC's main operations include manufacturing, assembling, and marketing of cars, vans, pickups and 4x4 vehicles in Pakistan. At present, the whole range of the Suzuki products currently marketed in Pakistan is being produced at the Bin Qasim plant. PSMC continues to be in the forefront in the automobile industry of Pakistan. Through effective marketing, wide network of sales, service and spare parts dealers, the company has successfully maintained its market share in the local market in terms of both production and sales. With a total market share of 57%, the company dominates especially in the lowend (1000cc) car segment. This segment is very popular in the middle-class income group of the country due to its affordability. Thus, the company enjoys high demand and consequently high sales volume. Apart from this, it has a meager presence of 11% in the high-end car segment (1300-1600cc). In the higher end segment, the company has only Liana in its portfolio. Previously it assembled Baleno locally which has been replaced by more advanced model of Liana. The export of Suzuki Ravi to Bangladesh and the sheet metal parts of Suzuki Cultus to Europe has given PSMC a competitive edge over other players. The company's exports in FY06 were touched Rs 35 billion mark. Further diversification in the untapped market will give a boost to the company's overall performance. Above all, the highest deletion level of Pak Suzuki amongst the industry players makes it least susceptible to rupee-yen exchange rate fluctuations. PSMC has consistently worked on its capacity expansion. The company has undergone three phases of capacity expansion, which were completed in FY05, FY06 and FY07 when the capacity improves to a level of 80,000, 120,000 and 150,000 vehicles respectively. The enhanced capacity has been absorbed and owes much to the rising demand, easy availability of finance and booming GDP growth. Pak Suzuki posted an after tax income of Rs 0.74bn

(EPS: Rs 9.14) in 1Q07. Despite 29.4% increase in sales of cars, the gross margins of the company declined by 12.4% in 1Q07 from 12.8% in 1Q06 mainly due to 1.5% appreciation of Japanese yen against the Pak rupee (J = Rs 0.5171 - average price in 1Q07 as compared to Rs 0.5093 in the same period last year). Sales volume, increased by 29.4% in 1Q07 over 1Q06 and stood at 30,346 units whereas the number of cars assembled was 28,353 in the period under review. Distribution and administrative expenses surged by 118.6% to Rs 402m in 1Q07 from Rs 184m last year due to aggressive advertising and sales promotion by the company to enhance market share. Other income declined due to reduced income on bank's deposits because of decrease in pending orders after capacity enhancement

AMALGAMATION OF SUZUKI MOTORCYCLES OF PAKISTAN (SMOP) WITH PSMC:


Acquisition of the business of Suzuki Motorcycles of Pakistan (SMOP) by PSMC has been approved in consideration of one share in Pak Suzuki Motors for every twenty-one shares in Suzuki Motorcycles of Pakistan. The PSMC will issue 1.233m shares for the remaining 59% shares as the company already had 41% shareholding in SMOP. As a result of the amalgamation, cost of operations is likely to decrease through streamlined distribution and elimination of duplicated services and operations and reduction in overhead and working expenses. Pak Suzuki enjoys a fairly strong liquidity position amongst the industry players. With its current ratio lingering around 1.5, an increase in liquidity in 2005 onwards owes much to the very steep rise in the current assets of the company. By virtue of high cash and bank balances and high level of inventory, PSMC has been able to fare well in terms of writing off its liabilities. Like other players of the industry, the company's major financing comes through acquisition of short-term debt. Expansions are financed either by cash or by equity as evident from the rise in paid-up capital. Long-term debt is near to the ground and comprises of deferred tax liability thus proves its zero contribution towards the company's total financing. This pattern of financing is in line with the industry trend. On the contrary, financial charges for PSMC are on higher side that can be attributed to high compensation paid to the customers for deliveries beyond 60 days. Further increase in

the rates of mark-up by the banks badly affected the finances of the company. The aftermath is visible in the deteriorating interest paying ability as indicated by the declining trend of TIE ratio. The State Bank in its recent monetary policy announced higher KIBOR rates that will further raise the cost of borrowing and might affect the interest paying ability of the company. Moreover, the company plans further expansion in the near future. The expansion would be financed through internal cash generation and debt financing in the ratio of 60:40 respectively. Higher debt will result in high interest payments, which would affect the debt management ratios considerably. Time lag in the delivery to customers has lengthened the operating cycle of Pak Suzuki. As a result, the trade debts have increased over the years under discussion. Due to the everincreasing demand for the automobile and corresponding rise in expansion capacity, inventory level has risen thus giving rise to higher inventory turnover ratio (in days). Nevertheless, the new expansion in FY07 will soon mobilize and reinforce the sales revenue of the company in future. On the other hand, PSMC is more efficient in converting its assets into sales as shown by total assets turnover ratio. Although the sales/equity trend is below the industry average, the trend can be misleading since the company issued a large amount of shares in subsequent years. All in all, the asset management of the company is commendable. Net profit margins also posted a healthy trend. During the years under discussion, PAT increased consistently except in FY04. FY04, in general had been unfavourable mainly due to appreciation of yen against the rupee and hike in steel prices which increased the cost of sales for the company consequently affecting the gross profit and net profit as well. As a result, all profitability ratios plunged. The bottom line of the company continued to augment due to high sales volume, and increase in car prices by the company from February 01, 2005 onwards. Other income also increased from FY05 onwards as due to higher income on bank's deposits because of improvement in markup rates. Other than that the top line also strengthened on the back of appreciation of the rupee against the yen. Financial charges increased enormously especially in FY06 due to increase in compensation paid to customers for deliveries beyond 2 months. The backlog of customer orders posted greater financial risk for the company, which was subsequently resolved through improved assembling capacity in subsequent years. Despite increase in the number of outstanding shares, PSMC has consistently augmented its net income and thus offers attractive EPS and BV for its investors. Thus the net worth of PSMC is significantly higher in absolute terms. Market price is also higher and depicts strong investors' confidence by offering higher dividends per share. PSMC enjoys a large shareholder base with a shareholder pattern skewed towards

associated companies and related parties. OUTLOOK: In the Budget'08 duty rate on vehicles has been increased while Capital Value Tax (CVT) has been removed. Thus the overall impact will remain the same. Moreover, withholding tax at 5% on purchase of local cars has been imposed. Import of used cars will now be restricted for cars up to a maximum of 3 years old that was previously 5 years which will benefit the local industry. Tight monetary policy stance by the government will add fuel to the fire. Whereas, the demand will go down on account of high cost of borrowing, those with the buying power will be bogged down by the 5% withholding tax as the prices of the locally manufactured cars have climbed up. The new Auto Industry Development Program (AIDP) features reduction in the customs duty (CD) on the CKD unit's localized and non-localized parts from 50%-45% and 35%-30% respectively over the 5 years. For the CBU category, the CD relief is only for the high-end car segment. Therefore, the company will not be able to reap advantage of this policy, as the major chunk of its product portfolio constitutes low-end car segment. Probably diversification in the high-end segment would enable PSMC to rule out the potential disadvantage and compete with Corolla and Honda Interested candidates can send their CVs latest by the following address or apply online. Position applied for should be clearly mentioned on the top right corner of the envelope or in the subject line of the e-mail, only short-listed candidates would be contacted.

Suzuki Motor Corporation - SWOT Framework Analysis:

PAK SUZUKI performs SWOT ANALYSIS for gaining competitive advantage among the market. The company has following criteria of SWOT ANALYSIS

STRENGTH:

THE MAJOR CSR CONTRIBUTION AND ITS COMPENSAINIG ACTIVITES TO EMPLOYEES.

WEAKNESS:

PAK SUZUKI IS STILL UNABLE TO GET MAXIMUM FROM ITS EMPLOYESS BECAUSE OF THEIR STRICT LEAVE AS WELL AS AGREEMENT POLICY.

OPPORTUNITIES:

PAK SUZUKI AVAIL ALL THE CHANCE TO BE GLANCE AT ONCE IN MARKET BY COSIDERING ITS EMPLOYEES, RESOURCES, AND TRAININGS.

THREATS:

SUZUKI LTD IS ENJOYING A GOOD REPO IN MARKET AND IS COSIDERED AS TOP MOST BRAND OF VEHICLE BUT AS THEY ARE TOP MOST IT HAS ALSO COMPITITORS WHICH ARE TOYOTA, HUNDAI, CHERVOLET. THEY ARE ALSO DOING THE SAME THING THAT IS DONE BY SUZUKI LTD. SO IT IS A MAIN THERAT FOR PAK SUZUKI LTD.

CONCLUSION
The company is using a standard procedure for selection of employees as well as their appraisal. They provide all the basic training to their employees, which they need as they are working in the organization. Organization also focus o n e m p l o y e e s i n c e n t i v e s a n d b e n ef i t s i n t h e f o r m o f compensation, casual leaves, education modeling, visit and in the occasion of employees like marriage of their children, fee compensation and so on.