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Organization Structure Training

A report submitted to Christ University of Management


Snehal Jeloka Register No: 1121445

Under the guidance of

Prof. T.S.Ramachandran

Christ University Institute of Management Bangalore


I declare that this training report entitled Organization Structure Training of HMT Machine Tools Ltd, Bangalore is a record of independent work carried out by me during the period of 29th April 2011 to 26th May 2011, under the Supervision and guidance of:1. Mr. Sudhakar (AGM-HRD) 2. Mr. T. S. Ramachandran (Mentor, Christ University) I also give my sincere thanks to various managers of all the Departments who have contributed to this project by lending precious information about the organization, without their help, this project would have been in complete.

Date: Place: Bangalore



1. Introduction 2. History of the Organization 3. Company Profile 4. Departments i. ii. iii. iv. v. vi. vii. Human Resource Department Finance Department Sales Department Planning Department Purchase Department Production Department Material Management Department

5. Trade Unions 6. SWOT Analysis 7. Findings and Suggestions 8. Conclusion

Organization is a systematically designed, scientifically planned, sum total of various function co-ordinate mutually, synchronized in a format to achieve the goals and objectives of company.

The various functions which contribute to the success of organization, which plays vital role in well-functioning, are the following Departments:

1. HR Department 2. Finance Department 3. Sales Department 4. Planning Department 5. Purchase Department 6. Production Department 7. Material Department

OBJECTIVE OF THE STUDY: The aim is applied to things exterior to the mind, & objectives of its attention subjective to the operations of the mind itself. Hence an objective motive is some outward thing awaking desire. The objective of the project at HMT machine tools limited, Bangalore includes: To get an insight into organization structure. To know the corporate profile structure & performance. To learn & study the functioning of an organization in the field. To gain the practical knowledge while conducting the study.

REASONS FOR SELECTING HMT: It is one of the reputed public sectors in India.

It is an organization with all departments under one roof & study of the organization structure will be more useful & meaningful. It has got many programs to help to the students by giving exposure to the real working environment. The production & distribution network is very efficient & large size.

SCOPE: The scope of this study is restricted to Bangalore unit of HMT. This report mainly focuses its view on companys profile & different departments such as marketing administration, finance, human resource & production departments.

ACTIVITIES CARRIED OUT DURING THE PROJECT PERIOD: Attending the organization regularly. Learning about the working environment. Assess the organizational performances. Interaction with the employees who have got more experience with their respective jobs. Studying the activities of the employees and how they work. Following up their rules & regulations in disciplined manner.

DATA COLLECTION: Field observation Secondary information at companys manuals Website of the company & other relevant sites. Newspaper clips.

HISTORICAL BACKGROUND OF MACHINE TOOLS Machine tools were manufactured as early as 1890, but were poor in quality and lacked standardization. After 1930, machine tools of a reasonably good quality began to be produced in India principally by P.N.Dutta and company in Calcutta co-operation engineering works at Satara and the Indian machinery company at Pasangar near Calcutta. These enterprise which were the pioneers of machine tools making in India made mostly sliding, surfacing and screw cutting lathes of the conceptually headstock types. However, all the enterprise suffered from the absence of a ready market for their products, mainly because of completion from established manufacturers in England. The outbreak of 2nd World war India became the main base of supply and production of war materials for the British and the allies army in the east. There was Avery sharp increase in demand for machine tools, all though, imports of machine tools continued on a reduced scale, throughout 936 and 1940 the situation became increasing more precarious.

In 1941 the government of India passed the machine tools control order/ whose main object was to make an inventory of machine tools that could be obtained in India and to regulate and improve production. So as to meet the needs of the ordinance factories and other near industries. The machine tool control laid the foundation for a rational and systematic development of the machine tool industry in India which gave birth to HMT. The idea of setting up a machine tool industry in the public sector germinated only after India got its independence. In 1947, the new government found the 4000 million worth of surplus was, arterials including a number of machine tools in itself. A committee was setup in 1948, which suggested the establishment of machine tool factory. In 1947, the government of India decides to enter in to a joint venture with the Swiss firm OERLIKON MACHINE TOOL WORK, BUCHIRE and COMPANY. Another few

years ruled by the government, registered HINDUSTAN MACHINE TOOLS was formally registered in 1953.

BIRTH OF HMT: Hindustan Machine Tools Limited is a public Limited company started in 1953 and the first output is given in 1955. HMT Ltd was incorporated as HMT LTD on 07th February 1953. Pandit Jawaharlal Nehru inaugurated HMTS First Manufacturing Unit (Machine tools, Bangalore) & remarked it as HMT is gift to country & jewel of country. Presently, HMT has branched into 16 factories, 24 divisions and 29,000 employees in 10 different states. The machine tools division at HMT in Bangalore was the oldest manufacturing unit of the company and the product line consists of 16 types of metal working machine. The die casting division molding machine in technical collaboration with reifenhaeuser Gmbh and company of West Germany. The company offered technical collaboration to industrial commercial development corporation of Kenya (ICDC) to setup plant for the manufacture of machine in Kenya.

PROFILE OF THE COMPANY Dr.S.M.Patel started HMT limited as a HINDUSTAN MACHINE TOOLS LTD on 7 th February 1953 in technical and financial collaboration with OERLIKON Machine tools works of Switzerland. The first product produced by machine tools was H22 lathe on 6 th October late of government of India bought the shares held by OERLIKON transforming HMT as a government of undertaking. Hindustan machine tools ltd Bangalore is one of the major machine tool factory in India, it is located at Bangalore it has branch into 16 factories 24 division and 29000 employees in 10 different states.

AREA OF OPERATION: HMT corporation head office is situated at Bellary road, Bangalore from where administration and control of all units of the HMT is undertaken by the company. Apart

from corporate head office, HMT has various offices in all states with the service center for the smooth functioning of the activities of the company. SUCCESS CLIP BOARD MILESTONES

YEAR 1953 1961 1963 1965 1967 1969 1971 1972 1973 1975 1975 1985 1986 1991

UNITS/DIVISION Machine Tools I Machine Tools II Machine Tools III Machine Tools IV Machine Tools V Press Division Die Casting Division Printing Machinery Division Precision Machinery Division Machine tools VI HMT (International) Ltd. Ball Screw Division CNC Systems Division Central Reconditioning Division

LOCATION Bangalore Bangalore Pinjore Kalamaseery Hyderabad Hyderabad Bangalore Kalamessery Bangalore Ajmer Bangalore Bangalore Bangalore

STATE Karnataka Karnataka Haryana Kerala Andhra Pradesh Andhra Pradesh Karnataka Kerala Karnataka Rajasthan Karnataka Karnataka Karnataka

Bangalore Bangalore

Karnataka Karnataka


Subsidiary HMT Machine Tools Ltd

HMT Fast Forward: It was in the early post-independence era that, HMT began in a small way to meet a big commitment: To manufacture mother machines to build modern industrial India.

HMT was conceived by the Government of India in 1949, and was incorporated in 1953, with the objective of producing a limited range of machine tools, required for building an industrial edifice for the country.

THE 1960s: With the success achieved in the initial years in absorbing the technology and in attaining production competence far ahead of the original plans, the Company launched a bold plan o diversification and expansion which resulted in the duplication of the Bangalore Unit and the setting up of new units at Pinjore, Kalamassery and Hyderabad. In 1967, recession struck the Indian Engineering Industry and the consumption of machine tools dipped drastically. The traumatic years of recession did indeed serve to bring to the fore two latent strengths of HMT, namely the urge to survive and the confidence to innovate. With these strengths at full play, the Company emerged from the recession. With action plans firmly launched for diversification into Presses and Press Brakes, Printing Machines, Die Casting and Plastic Injection Molding Machines, that were considered to have economic cycles that are different from those of machine tools.

THE 1970s: The 70s witnessed the fructification of all the diversification plans as envisaged. HMT set up: HMT International Limited as a subsidiary company to channel HMTs products and technical services abroad. Two more units for manufacturing of watches, one at Srinagar and another at Tumkur. HMT took over Machine Tool Corporation at Ajmer as its sixth machine tools unit.

THE 1980s: In the 80s, HMT as a part of vertical integration efforts, launched units to manufacture: Watches at Ranibagh. Watches Cases at Bangalore

Steppers Motors at Tumkur. CNC Systems at Bangalore Ball screws for use on CNC machines at Bangalore HMT took over Indo-Nippon precision Bearings Ltd, a state owned unit as a subsidiary, which was renamed HMT-Bearings Limited. HMT took over Praga Tools Ltd. as another subsidiary.

THE 1990s: Formation of Machine Tool Business Group as part of Business Reorganization. Formation of Central Reconditioning Division at Bangalore.

The New Millennium Formation of HMT Machine tools Limited as a wholly-owned subsidiary of HMT Limited.


HMTS MISSION To establish ourselves as one of the worlds premier companies in the engineering field having strong international competitiveness. To achieve market leadership in India through ensuring customer satisfaction by supplying internationally competitive products and services. To achieve sustained growth in the earnings of the group on behalf of shareholders

CORPORATE OBJECTIVES & GOALS To encourage the modernisation of Indian Industry through the supply of engineering goods and services of world class excellence To maintain technological leadership through continuous efforts to update product technology and manufacturing methods To globalise our operations by developing a mix of international markets and businesses

To ensure a satisfactory return on capital employed, to meet the growth needs and the aspirations of our stakeholders To present an active, pleasant and productive working environment. CORPORATE STRENGTHS




Organisation Structure


Human Resources Department:

HRM is planning, organizing, directing and controlling of the procurement, development, compensation, integration and maintenance of people for the purpose of contribution to organization, individual, social goals. HR needs to be given a strong emphasis, as it is the quality of human factor in his organization, which determines its effectiveness.

KEY ROLES PLAYED BY HRM DEPARTMENT 1. Recruitment 2. Selection 3. Induction 4. Promotion 5. Transfer 6. Welfare

OBJECTIVES OF HUMAN RESOURCE To attract and retain best available young talent in the country in engineering and other areas like finance, marketing and personal. To maintain effective coordination between HRM and other departments HRM department helps in motivating the employees in attaining individual goals and in retune will lead to attain the organizational goals. A qualified applicant for specific type of job. To ensure the above objectives by eras of a systematic scheme of centralized recruitment this will be regular and effective.

SCOPE The recruitment of professional trainees in engineering and other professional areas like finance, marketing, personnel etc., induction level of executive that is PS 3 for centrally pooled requirement of units. Recruitment of senior executive at level of corporate cadre like PS 7 is as per need of unit.






ESTABLISHMENT SECTION Establishment section of HMT MBX involved with the activities like recruiment, selection, promotion and performance appraisal record of day-to-day activities as well as manpower adjustments. The selection is basically involved with estalbishment acitvities.

Recruimtent and selection It is process of selection for prospective employee and stimulating and encouraging them for job in an organization. Selcetion is process of putting right perosn to right job according to job specification of organization.

Procedure or recruitment rules 1. 2. Corporate personnel directorate will engage recuriment. It is centralized recruitment by following two methods: Campus recruitment Recruitment trhough opens all India advertisement.


Not less than 50% of vacancies projected

and approved in manpower

operational plan in PS 3 for engineering graduates and in vairous disciplines. 4. Campus recruitment for post of executives in PS 3 for engineering graduate or post graduate in technical areas or postgraduate diploma holder from recognized institution only, 5. Mode of selection by group discussion and personal interview by above committee. 6. All India advertisement will be released every year, inviting applciaiton form candidates possess degree in engineering with minimum marks of 60% who will be eligible for written test. 7. The result of written test candidate in the ratio 1:6 will be called for interview and group discussion. 8. 9. Selected candidate will undergo induciton training for period of a year. For seection of senior executive at level of corporate cadre will be taken up by corporate personal directorate once in 4 months in April August an dDecember in calendar year. 10. Recruitment was done for last time in 1992 & now days HMT is planning to recruit fresh blood.

INDUCTION POLICY After selection of qualified candidate they undergo management trainee induction program for a period of one year. In one year 3 months are a MDI and remianing months at rspective units. Purpose of induction program is to acclimatize them into companys wokring system and culture.

TRAINING AND DEVELOPMENT MEASURES Training calendar: The tainin gprogram in HMT is conducted according to the annual training calendar prepared every year for all categories of workers.

Identification of training needs: Training needs shall be identified by respective needs of departmetn. Training shall be planned, implemented & reviewed. There shall also be general orientation awareness & knowledge based training program including induction program to the trainees in a new areas & freshly recruited personnel. Training program for personnel working areas of special purpose.

Types of training porvided by HMT (MBX) Apprenticeship training: Training is for period of 3 years. Those who apply for apprentice should have passed S.S.L.C on the date of report. The report says that there are 91 trainees are paid a stipend of 820/- to 1090/-. Graduate training: Training is given for graduates such as B.A, B.Com, and B.E in mechanical & others. The period of graduates training is for a year and they get a stipend of 1970/- PM. Sandwich trianing: Diploma students are eligible for taking sandwich training. It is for one year. Students are from vairous colleges. They are given 3 months basic training & they have their classes. After completing basic training they will be send to different department for 15 days or 1 month and they ger stipend of 1140/-. Foregin training program: Employees are sent to foreign training program under various plans vise UNIDO, COLOMBO etc. the candidates should be less than 45 years of age. The candidates should not have attended a foregin

program in 5 years.

PERFORMANCE APPRAISAL SYSTEM Managing employees performance is an integral part of the work that allmanagers and rating official perform throughout the year. I tis as important as managing finiancial resource &program outcomes beacuse employees performance or the lack thereof, has a profound effect on the financial & program components of any organization.

COMMON METHODS OF PERFORMANCE APPRAISAL INDIVIDUALS EVALUATION Confidential report Essay evaluation Critical incidents Checklists Graphic rating scale BARS (behavior anchored rating scale) Forced choice method MBO (management by objectives)

MULTIPLE-PERSON EVALUATION METHODS Paired comparison methods Forced distribution methods Paired methods

OTHER METHODS Group appraisal method Assessment center Field review


It plays a vital rolein HMT. HMT being a PSU will have to raise their standards with
respect to safety health and welfare of its employees, the welfare activities of HMT can broadly classified as follows. 1. Welfare measures inside the workplace. 2. Welfare measures outside the workplace.

Welfare measures inside the workplace:

a. Working conditions: 1. Cleanliness, neighborhood, safety. 2. House keeping, maintaining of lawns, compounds, passages, doors etc. 3. Providing safety equipments such as helmets, goggles nad first-aid equipments. Safety training programs for supervisors and workers to avoid accident. All machineries are examined periodically to ensure their safe working. Six safety committees consitute to discuss safety related problem and to take corrective measures for prevention of accidents. 4. Employees are provided with uniforms every year. Company is incurring around 14-15 lakhs p.a for this purpose.

b. HMT provides numbe rof amenities to its employees in addition to meeting the statutory obligations under varius labour organizations: Canteen-Canteen is managed by welfare department; it is incurring 96 lakhs p.a to provide hygienic food to it semployees. Transport-Company has a fleet of 6 buses besides Vans and Cars to provide transportation faiclties to its employees. Township A self-contained township with modern facilties has beenprovided for the benefit of employees. there are around1676 houses of vairous types of allotment to employees and allotment is based on seniority and grade eligibility. Medical A 200 bed hospital with all modern facilities is established in the township to take care of medical needs of employees residing in township and surrounding areas.

However, if employees are not covered under ESI (Employees State Insurance Corporaiton) the compnay will provide medical facilities. As to say, if the salry is Rs.10000 or less, the employees will get ESI benefits. And if the salry is above Rs.10,000 they will get companys medical facilities.

Company Assistance and Welfare Measures 1. HMTL House building advance (grant & recovery rules)

2. Scheme of interest subsidy for purchase of vehicles through loans from finances institutions. 3. Company leased accommodation for PSVII and above. 4. Leave and Leave encashment rules. 5. Leave Travel concession scheme Policy on Uniforms 6. Policy on gift watches. To the employees of the company. Earned leave Casual leave Sick/commuted leave Maternity leave Special leave.

7. Incentive for acquiring higher qualification The employee who attains higher qualifications will be granted monetary awards as mentioned below provided that. a) after joining HMT. b) The employee has not been granted study leave for acquiring qualification. 8. Medical benefits & Insurances. 9. Compensation for Employment injury to those not covered under the workmens compensation. 10. 11. Incentive for small family norms. Inter-unit sports regulation. The qualifying examination has been taken up

RPF rules and regulation of corporate office and marketing division

INDUSTRIAL RELATION In HMT (MBX), Industiral relaitons deal with either the relationship between the state and employers and workers in an organizational themselves. This helps to resolve from any kind of disputes like: misunderstanding, differnce of opinions, (or) conflict that arises

between an employer and his workmen. Therefore a high level of understanding and positive relationship between them, can alone lead to the achievement of organizaiton objectives. Hence industrial relation plays an important role.

Any business for the matter whether large or small, profit motive is considered to be a financial concern and its success or failure to a large extent depends on its financial decisions. Efficiency of the organization is brightened only when there is efficient management of its finance. Financial pans may take many forms but any good plan must be related to the companies eisting strengths and weaknesses. The strengths must be understood if they are to be used to proper advantages and weaknesses must be recognized and correct meaures is to be taken in accordance with the forecasting and budgeting procedures, but the plan must begin with financial analysis. Financial analysis is the evaluation and intepretaiton of a companys fiscal position and operaitons.


FUNCTIONS OF FINANCE DEPARTMENT: The various funcitons under finance department are: Planning of funds Acquisiton of funds Allocaiton of funds Investment of funds Dividend decision Recording of the transaction Preparing of financial statements Evaluation of financial performance

Planning of funds: Planning of funds is a careful estimate made by the manager about the total funds required which includes both fixed and working capital requirments. This estimation is done by a keen observation over physical acitivities of the factory. The working capital requirments in HMT are more. In the year 2008-09 the total budgeted amount is Rs.124 crores but sanctions are made as follows: 52 crores from governement 10 crores from head office 2 crores from other HMT divisions 12 lakhs from bill discounting 5 crore from capital profits.

Acquisitions of the fund: The HMTMBX will acquire the fund from different sources like: UCO [united commercial bank] which is consortium of 9 banks tha tprovides secured loan by hypothecation of assets like inventories, machineries etc. Government of India: it will provide funds only for capital expenditure and VRS. Debtors recivable Loan from head office

Sale of scrap:[this yearsprofit from sale of scrap is Rs.83,00,000]

Allocation fund in HMT (MBX) are made as follows: Material planning (Machines tools) -50% Salary (basic pay + DA + DP + allowances+amenities) 30% Other expenses (electricity, miscellaneous expenses etc) 15% Interest payments 5%

Investment of funds: Investment decisions comprises of investment in capital assets, investment in current assets which is based on the inventory and credit proposals purchasssed by HMT and by studying requirmmments of working capital. The investmentin capital assets is done after a careful study over the profitability, safety, liquidity and solvency factor of those assets. Currently there is no investment made by the HMTMBX.

Dividend decisions: Divident decision involves the determination of the percentage of profits to be paid to it shareholders. This percentage is decided after considering the factors such as market price of the shares the trend in earnings, the tax position and the profitability use of funds. Currently the HMTMBX is not making any profits and hence no dividends.

Recording of the transactions:

Each and every transaction that takes place daily has to be recorded properly for thepurpose of having better control over the funds and for optimize them. All the transactions are recorded in journal and then posted to the ledger. The informaiton stored in ledger will be used to prepare the financial performance. The financial statement includes trading a/c and income statement and the balance sheet.

Preparing of finanical statements: The company prepares vairous financial statements like trading and profit or loss account, balance sheet, cash budget, cash flow, fund flow.

Evaluation of financial performance: The financial performance evaluated by comparing budgeted statement and actual statement by using comparative BS, ratio analyses.

Various sections under finance department: Inward Bill Section (IBS) Outward Bill Section (OBS) Wage Section Cash and Provident fund Section Main Accounts

INWARD BILL SECTION (IBS) This section mainly deals with the purchases. There is inland purchase and imports in the company. The payment for purchases is made by this section. The purchase department gives the quotation for goods. When the order is accepted by the company,

the purchase department will send the purchase order to IBS. The material inward slip is received by IBS from the stores. The IBS also receives the invoices or bills from the suppliers. That materials purchased are classified into various groups: Group 1 Stores and Spares. Group 2 Purchase of raw materials. Group 3 Capital items. Group 4 Export machinery Group 5- foreign purchases. Group 6 Miscellaneous expenditure/payment towards freight. Group-7 Electrical parts.

Objectives of IBS: To see the entire material brought in is accounted properly. Payment is realized only when the supplier the materials or components. To see if central value added tax, excise duty are accounted porperly or not. Mode of payments: The payment for the purchase is made by :1. Advance payment. 2. Sundry creditors payment. 3. Payment through bank. 4. Payment through letter of credit.

OUTWARD BILL SECTION (OBS): Outward billing section is also known as Centralized Billing Section. In OBS the customers deal with making payment to the company. When the customer of HMT wants the finished product produced by the company, the customer will raise the purchase order. The company will make an enquiry regarding the availability of the product and accept the order given by the customer and prepare a delivery voucher which includes consignee name, quality, designation of material, spare parts, price, goods carrier, notes details, parties name and address, PAN no. ECC no., service tax sales tax etc will be furnished. It also deals with sale of machinery, spares, accessories, CNC, foundry, casting, reconditioning, repairs, maintenance etc. and filing of statutory returns is also undertaken. OBS Activities 1. Accounting of customers payment towards advances, outward bills balance payment. 2. Preparation of sales journals and statmetn at the end of month. 3. Preparation of ledgers which contians information about deposits, withdrawals etc. 4. Preparation of invoices along with the delivery voucher and purchase order. 5. Letter of credit is also made in case of credit sales to the outsiders, when the bank guarantees for advance payment, security deposit etc. Further OBS accounts for the following: a. Bank guarantees

b. Indemnity bond c. Bills for discounting d. Accounting for telegraphic transfer e. Accounting for funds transfer to other f. Providing necessary journals, schedules etc for auditing. These are sent to main accounts section for further processing.

WAGES SECTIONS: Wage section is the section, which deals with the employees benefits and other activities with regard to company services towards the employees. It is the section, which helps to keep a better relation between union and management. It deals with any grade and handles the task of basic pay, DA, HRA. There are three punching times: 1. In punch 2. Lunch punch 3. Out punch Functions of wages section: 1. Time keeping 2. Salary payment to employees 3. Incentives payment 4. Provident fund (PF) 5. Dearness Allowance(DA) 6. Pension

7. Income tax 8. LIC 9. Advances 10. Medical polices This section deals mainly with the attendance record, salary payments and incentives payments. There are two types of incentives and they are: Direct areas incentives for workers grade Indirect areas incentives for officers grade Salary includes basic wages, DA, retaining allowances and cash value of food concession, admissible if any. The salary is considered on the basis of past service, pension able service, widow pension and withdrawals benefit, as written in constitution.

CASH SECTION: Cash section is one of the important sections in finance department. This department handles all cash dealings. It generates funds for the company and utilizing the funds through proper investment. Cash section deals with: Payment made by cash and cheque Receipts and payments of cash The activities through UCO bank, local UCO branch, Punjab national bank. Preparation of petty cash book. Cash dealings: 1. Physical cash dealing

2. Booking section Physical cash dealing includes: Payment of wages and bonus to casual labors. Receiving cash from bank. Making cash payments. Booking section undertakes the issue of cheques towards various payments to suppliers, statutory bodies, salaries to PS group. This section operates the bank accounts by the authorized joint signature identified by the head office. Cash receipts Receipt vouchers are received by cash section from OBS in three copies and the copy is: 1. Retained by cash section 2. Given to the concerned section 3. Given to the customer Cash Payments Payment vouchers are received by cash section from IBS in three copies and the copy is: 1. Sent to concerned section 2. Given to supplier 3. Retained by cash section Cash section should submit its report on quarterly basis for auditing. Every month end,. The reconciliations are checked in cash section and the salary is credited to the employees saving bank account under cash section.

MAIN ACCOUNTS SECTION The main function of this section is to consolidate all the activities of other sections such as IBS, OBS, wages etc and arriving at the trail balance, preparing P&L account and balance sheet, reports and budgeted statement. In this section, there are three types of audit done. They are as follows: 1. Internal audit 2. Statutory audit 3. Government audit Significant accounting policies The financial statements are prepared as of a going concern under the historical cost convention on accrual basis of accounting and in accordance with the mandatory accounting standard issued by the Institute of Chartered Accountants of India to the extent applicable: a. Fixed assets b. Depreciation c. Investment d. Inventories e. Development and commissioning f. Deferred revenue expenditure g. Revenue recognition

h. Foreign currency recognition i. Borrowing cost j. Lease k. Retirement benefits l. Warranty m. Special tool n. Research and development cost o. Others Main accounts section deals with the major activities of the company.

Sales Department under HMT Machines and tools, Bangalore complex is one of the important departments dealing with sales Engineering and Sales Execution. General Manager Head of Sales

Sales engineering

Sales Execution

FUNCTIONS OF SALES The sales Department deals with the following activities: a) b) Sales Engineering Sales Execution

Sales engineering prepared the annual operation plan (ADP) for sales based on the marketing forecast/past trend. Sales engineering plans and controls the activities such as submission of offer to customers and convert them into orders. On receipt of order, co-ordinate internally to build machines and to ensure delivery of the machines to the customer has direct inter phasing activity with design and development, machine tool marketing and customer. Sales Execution activities start with receipt of order. On receipt of order, they coordinate to build machines procure manufacture and to ensure delivery of the machine to customer. It has direct interaction with design in case of special executions based on specific customer requirement sales execution also has direct interphasing with machine tool marketing and customer. Debtors/C&D form Collection.

It is a predetermined future course of action. It is the advanced planning of the future activities. Planning is the determination of personnel and machine programmers. It involves planning of human resource requirements as well as machine requirements as well as machines requirements. It also involves forecasting of personnel and machine needs, changing values of employees as well as machines to suit the organization needs.

The functions of purchase department in HMT are decentralized and each unit is responsible for procurement of its requirement based on the approval annual operation plans subject to quarterly review based order or market feedback.

Objectives of purchase department: To ensure timely procurement and supply of material. To ensure fair consistent and transparent purchase practices are followed.

To ensure continuous search for alternate source supply. To act as information center for material To ensure investment made on inventory is at optimum level.

Purchasing procedure: Following is the procedure involved in the purchase of materials: 1. Indent 2. Material purchase requisite 3. Circulation of enquiries 4. Repairs of offers 5. Comparative statement. 6. Recommendations for procurement 7. Proposed for purchase 8. Financial concurrence 9. GMs sanction for purchase 10. Placement of order 11. Confirmation of order 12. Follow up 13. Receipt at stores 14. Preparation of material inwards slip 15. Inward inspection

Purchasing Committee: Every unit should have purchase committee as under: Unit chief Finance chief Material chief Purchase chief Chairman General manager

Joint general manager (JGM) Conveyor. Purchase committee should meet once in a year and the reports of purchase committee will be recorded in relevant files and duly scrutinized.

Production is the process of converting the raw materials into finished products. HMT has been designed & built using modern production engineering techniques. It has a flow production technique employed all stages to ensure high quality at low cost. The plant is equipped with special purpose production units, test equipment and mass production machinery. HMT follows batch production.

The production department of HMT MBX is very vast. However this department is concerned with the production of components, and that is all related to different machines tools, so it consists of lot of functional heads under the department.


For manufacture of finished goods raw material are required by assembling many components. Finished goods are manufactured so in order to check and control the various activities right from the purpose of the raw material to disposals of finished goods to customer, a proper material management is required in MBX. Material department carries this out. HMT started with one product in 1953 and is now dealing with 26 products. Total machines are 426 in that 250 are idle. The main reasons for idle machines are: Reduction in manpower Reduction in sales turnover. CNC machine came into existence to reduce number of people working to increase output. Each material has BOM (bill of material). It is categorized into indirect and direct materials.

WINGS OF MATEIRALS Plan Procurement Storing Inventory Methods used for material management is ABC classification


HMT Bangalore complex has various TRADE UNIONS which works for the welfare of the employees. Among the oldest trade union is Indian National Trade Union Congress (INTUC). It is existing from more than 25 years. Now this union is called HMT Karmik Sangh headed under congress party. There are other Trade Unions apart from this which carries out different types of activities in the company.

The different types of trade unions in HMT are:1. Indian National Trade Union Congress (INTUC) 21 2. Bhartiya Majdoor Sangh (BMS) 3. Employees United Front

Among these unions, INTUC is headed by Congress, BMS is headed by BJP and Employees United Front is not affiliated to any political parties.

STRUCTURE OF TRADE UNION Trade union consists of the following committee members:1. President 2. Vice President 3. General Secretary 4. Treasurer 5. Joint Secretary 6. Assistant Secretary There can be more posts depending upon the unions but there should be a minimum of 3 posts of President, Vice President and General Secretary. The Trade union is selected by an election among all the trade unions in HMT.

RESPONSIBILITIES OF THE COMITTEE MEMBERS:1. PRESIDENT - He Controls all the office bearers and also communicates with the management of HMT. 2. VICE PRESIDENT - He functions and takes on the responsibility of President in his absence. 3. GENERAL SECRETARY - He is responsible for all the correspondence and Administration related works. 4. TREASURER - He looks after all the money matters in the trade union.

STRENGTHS 1. 2. and good will. Good Brand Image. Proven track record of customer satisfaction

3. force. 4. 5. 6.

Highly skilled professionally qualified work

Extensive marketing network. Units accreted with ISO 9000. Well-established manufacturing auxiliary facility like captive foundry, tool room high technology machine tools, heat treatment etc.

7. 8. 9. inland and International. 10. effectively like: 11. parts of the countries.

Huge infrastructure facilities First reputed machine Tools in India. HMTs Machine tool has good quality image

Diversification process has been carried out

HMT Machine tools. HMT watches. Chinar watches. Bearings. Tractors. Praga tools, HMT branches have been setup in different

Bengaluru. Hyderabad Kalamassery Ajmer Pinjore

WEAKNESS 1. Delay in implementing new systems. 2. Surplus manpower in some divisions. 3. It is facing financial crisis and has been incurring losses since 1993.

4. No internal control. 5. Management is not given more powers to take timely decisions. 6. Wide range of machines in the organization has led to low concentration. 7. Wide gap in communication. 8. The employees do not know the annual target of the HMT. 9. Immediate planning and execution is not carried out.

OPPORTUNITIES 1. Bulk requirement of machine tools like high speed/automated presses, forging lines etc for defense production. 2. Modernization of railways and plants. 3. Renovation and up gradation of machine tools. 4. Increased export requirement for HMTs rang of metal forming tools in countries like Africa and high technology CNC machines by advanced countries like USA. 5. HMT can deliver its products very faster to the customer by speeding up the production process. 6. Boom in the infrastructure to benefit HMT entry into earthmoving machines on the higher HP tractors.

THREATS 1. The company has to face severe competition from both international as well as domestic market. 2. Competitors offering high technology machines through collaboraiton, up gradation of existing products and resorting of flexible prices. 3. HMT is lagging behind in technology as compared to MNC players who has recently entered into Indian markets. 4. Increasing competition with entry of new manufacturers making low-cost products. 5. Emerging new machine tool manufacturing countires-China, the Province of Taiwan and republic of Korea.


Direct marketing by foreign machine tool manufacturers in India through their own selling set-ups. Rise of Regional distributors selling on Stock and Sale basis, on behalf of foreign manufacturers.



The growing competition and technological developments in this sector are having inevitable effects on the Indian machine tool industry as a whole. The HMT machine tool limited is facing typical problems in the emerging globalization scenario as under:

POSITIVE ASPECTS 1. variety is too large. 2. HMT machine tool has a regular system for determining unserviceable or damaged stores, raw materials and finished goods. 3. items. 4. The units have maintained proper records showing full particulars including quantitative details and situations of fixed assets. 5. The unit has maintained up to date records and submitted to respective authorities. 6. year by the management. 7. Majority of respondents perceived HMT as a global player and market leader in developing countries. 8. training and orientation program. 9. Exports are high. The major kind of agent used by the company is Inventory has been physically verified during the Materials are classified as A, B and C class Manufacturers sell different designs of machine-

NEGATIVE ASPECTS 1. The company has not been utilizing whole installed and licensed capacity of its machines effectively which has in turn resulted in low production.

2. management. 3. 4.

Interruption of trade union is more in the work of

Lack of utilization of infrastructure. The technology is not advanced. This is one of the reasons for low productivity. Thus production process is costly and time consuming and overhead costs are high.

5. 6. and Development. 7. management in HMT. 8. 9. 10. 11. 12.

Government is not industrializing at fast pace. Absence of center of excellence for Research

Idle time is more; there is no proper time

Motivation of employees is less. Less concentration on domestic market. Lack of training including the concept of %S. No recruitment and selection in corporate office. After 1993, salaries are not revised.

SUGGESTIONS FOR NEGATIVE ASPECTS: 1. The company should make efforts in making the whole use of installed and licensed capacity. 2. level. 3. The company should update its technology so the tit can beat the competitors price and also produce higher quality products. 4. cost of production. 5. Government should liberalize some policies in order to take necessary decisions by management. 6. 7. absenteeism and idle time. Development in R & D is required. The company should reduce inefficiency, Machines must be replaced in order to reduce Infrastructure should be utilized at optimum


The company should concentrate on motivation, incentive schemes and should liberalize promotion strategies.


Upgrade the training programmers in order to increase the efficiency of workers in order to increase the efficiency of workers.


Recruit skilled employees so as to replace existing employees, as most of them are eat retirement sage and should encourage them to take VRS.


Major part of revenue earned is spent on payment of interest. Therefore measures should be taken to reduce the amount of credit.

The study carried out as a part of curriculum of MBA, Christ University gave me a real exposure to the operational procedures of the company. It helped me to explore the possibility of rejuvenating the health of a company. HMT is a very popular name among every Indian, because of its innovation of technology quality assurance durability affordability to its people or customer. HMT has created the brand image that symbolizes machine tools to a manufacturer, tractors to a farmer and watches to millions of people in India. Today HMTs machine tools expertise has been developed to such an extent that HMT can design and develop any kind of machine from simple lathes to CNC machines to flexible manufacturing system. Today HMT is multi technology multi product company. HMT commitment to the development of machine tool technology is clearly reflected in that HMT has as many as 9 exclusively machine tool unit spread across the country In the changed market condition the organization needs to focus on the customer satisfaction, in reaching out this goal are conclusion basis the management has to constantly upgrade technology product profile internal work process nad plant and

machinery in the end ultimately it is the employees who will change the performance of the company. Therefore motivation must find priority. During the short period of my study of various departments I found HMT a wellstructured organization capable to maintain inter personal relationships among employees are very experienced and very dedicated where they feel company a home.

HRD (AGM) Mr. Sudhakar Company manuals Websites: