feasibility study of implementing balance scorecard at iffco

FEASIBILITY STUDY OF IMPLEMENTING BALANCE SCORECARD AT IFFCO, Kandla


A PROJECT REPORT

Submitted by

Sunita Nandwani (09070)

Anushree Pillai (09083)

To

Director (PGDM)

In partial fulfillment of the requirements of

Tolani Institute of Management Studies, Adipur

For the award of degree of

Post Graduate Diploma in Management

Tolani Institute of Management Studies

Adipur- 370205

JULY 2010



EXECUTIVE SUMMARY



INDEX

Sr No.

Particulars

1 Introduction to Balanced scorecard

1.1 Literature review

1.2 Introduction to IFFCO

1.3 Vision

1.4 Mission

1.5 Units of IFFCO

2 Objectives of the project

3 Methodology

3.1 Data collection method

4 Findings and Analysis

5 Limitations

6 Conclusion and recommendations

7 Bibliography



Introduction

In 1992, Kaplan and Norton published an article about the Balanced Scorecard (BSC). At that time, it was a new approach to strategic management. They recognized some of the weaknesses and vagueness of previous management approaches. The balanced scorecard approach provides a clear description as to what companies should measure in order to 'balance' their financial perspectives.

What is the balanced Scorecard?

The Balanced Scorecard is a performance management tool that enables a company to translate its vision and strategy into a tangible set of performance measures. However, it is more than a measuring device. The scorecard provides an enterprise view of an organization’s overall performance by integrating financial measures with other key performance indicators around customer perspectives, internal business processes, and organizational growth, learning, and innovation. Kaplan and Norton describe the innovation of the balanced scorecard as follows: "The balanced scorecard retains traditional financial measures. But financial measures tell the story of past events, an adequate story for industrial age companies for which investments in long-term capabilities and customer relationships were not critical for success. These financial measures are inadequate, however, for guiding and evaluating the journey that information age companies must make to create future value through investment in customers, suppliers, employees, processes, technology, and innovation."

EMERGENCE OF THE BALANCED SCORECARD

The conceptual framework of the Balanced Scorecard was introduced by Kaplan and Norton (1992, 1993, 1996) for the purpose of designating, evaluating and measuring factors that drive an organization’s performance.

Historically organizations placed a great deal of emphasis on financial measures in operating their organizations. According to Kaplan and Norton (1992) reliance on financial measures in a management system is insufficient, as financial measures are lag indicators that reflect the outcomes from past actions. The Balanced Scorecard paradigm retains measures of financial performance and supplements these measures with factors that drive future financial performance. The Balanced Scorecard is based upon the cause-and-effect relationships of the financial and non-financial measures derived from the organization’s strategy. The perspective Kaplan and Norton stress moves from an emphasis on tangible assets to, and including, an emphasis on intangible assets. They asserted that intangible assets became the major source of competitive management by the end of the twentieth century. Consequently, it became necessary to develop strategies for managing an organization’s intangible assets. These intangible assets include such things as customer relationships, innovative products and services, high-quality



responsive operating processes, skills and knowledge of the workforce, the information technology that supports the workforce, and the organizational climate that encourages innovation, problem-solving, and improvement.

Kaplan and Norton’s Balanced Scorecard concept seeks to provide managers with a set of performance metrics balanced between outcome measures and measures of the drivers of future outcomes (1996 b). It provides a framework for organizing strategic objectives into four perspectives. In each of the four perspectives quantitative measures are developed in order to operationalize the model. The four perspectives are as follows:

Financial – The strategy for growth, comparability, and risk viewed from the perspective of the shareholder.

Customer – The strategy for creating value and differentiation from the perspective of the customer.

Internal Business Processes – The strategic priorities for various business processes that create customer and shareholder satisfaction.

Learning and Growth – The priorities to create a climate that supports organizational change, innovation, and growth.

The Four Perspectives of the Balanced Scorecard

1. Financial : Historically, this measure has been the cornerstone of performance measurement. The bottom-line is a good indicator of whether the organisation’s policy and strategy and properly implemented and executed, and contributing to the bottom line. Some traditional financial measures include: operating income and return-on-capital-employed or economic added value. Alternative financial objectives can be rapid sales growth or generation of cash flow.

2. Customer : This element focuses on the ability of the organisation to provide quality goods and services, the effectiveness of their delivery, and overall customer service and satisfaction. But the customer perspective should also include specific measures of the value propositions that the company will deliver to customers in targeted segments. The customer perspective identifies the target customer and market segments for each business unit. The segment-specific drivers of core customer outcomes represent those factors that are critical for customers to switch to or remain loyal to their suppliers. For example, customers could value short lead times and on-time delivery, or possibly a constant stream of innovative products and services. The customer perspective enables business unit managers to articulate the customer and market-based strategy that will deliver superior future financial returns. Common indicators of customer performance include market share, customer satisfaction and customer retention figures.



3. Internal Business Processes : This element captures on the internal business results that lead to financial success and satisfied customers. Organisations must identify the key business processes at which they must excel and monitor them to ensure that outcomes will be satisfactory. Internal business processes are the mechanisms through which performance expectations are achieved.

4. Learning and Growth : This element assesses employee ability and the quality of information systems, and the effects of organisational alignment in supporting accomplishment of organisational goals. Processes will only succeed if adequately skilled and motivated employees, supplied with accurate and timely information, are driving them. In order to survive, the enterprise must reinvent itself to fit ever-evolving markets. Learning and growth measures identify the infrastructure most appropriate to the firm. They are derived from human resources, organisational systems and procedures. Traditional learning and growth measures may encompass: employee satisfaction, retention and skills; information systems performance; and organisational procedures’ calibration with employee incentives.

Cause-and-effect relationships

The Balanced Scorecard relies on the concept of Strategy developed by Michael Porter. Porter argues that the essence of formulating a competitive strategy lies in relating a company to the competitive forces in the industry in which it competes. The scorecard translates the vision and strategy of a business unit into objectives and measures in four different areas: the financial, customer, internal business process and learning and growth perspective. The financial perspective identifies how the company wishes to be viewed by its shareholders. The customer perspective determines how the company wishes to be viewed by its customers. The internal business process perspective describes the business



processes at which the company has to be particularly adept in order to satisfy its shareholders and customers. The organizational learning and growth perspective involves the changes and improvements which the company needs to realize if it is to make its vision come true. A strategy is a set of hypotheses about cause and effect. The measurement system should make the relationships (hypotheses) among objectives (and measures) in the various perspectives explicit, so that they can be managed and validated. The chain of cause and effect should pervade all four perspectives of a BSC. For example, the strategy of an engineering company could be to perform consultancy besides the regular work because it provides a higher return. Return-on-capital-employed (ROCE) may be a scorecard measure in the financial perspective. The driver of this measure could be expanded sales to new and existing customers as a result of a high degree of loyalty among those customers. Thus, new customers and customer loyalty is included on the scorecard in the customer perspective because it is expected to have a strong influence on ROCE. A market analysis may have revealed that there is a need for consultancy.

In this case, providing consultancy is expected to lead to new customers and higher customer loyalty, which, in turn, is expected to lead to higher financial performance and so new customers, customer loyalty and consultancy (which could be measured by the number of consultancy projects that has been carried out) are incorporated into the customer perspective of the scorecard.

The process continues by asking which internal processes for the engineering company are necessary in order to practice consultancy. To achieve this, the business may need new quality consultancy products. The new products must first be developed and afterwards tested on quality. Developed consultancy products and process quality on consultancy products are factors that could be scorecard measures in the internal perspective. The engineering company can develop consultancy products by training its operating employees in the required skills. If the company also engages experienced consultants, this will shorten the development time of the consultancy products. These experienced consultants can act as mentor for the trained employees. Experienced consultants and trained employees for consultancy are objectives that would be candidates for the learning and growth perspective. Now the entire chain of cause-and-effect relationships can be established as a vertical vector through the four BSC perspectives



Key performance indicatorsMetrics used in the BSC are typically called Key Performance Indicators (KPIs) because they measure how well the organization performs against predefined goals and targets.There are two major types of KPIs: leading and lagging indicators. Leading indicators measure activities that have a significant effect on future performance, whereas lagging indicators, such as most financial metrics, measure the output of past activity. Leading indicators are powerful measures because it gives managers more time to influence the outcome.

LITERATURE REVIEW

Conceptual Foundations of the Balanced Scorecard by Robert S. KaplanThe article was based on a multi-company research project to study performance measurement in companies whose intangible assets played a central role in value creation (Nolan Norton Institute, 1991). Norton and David believed that if companies were to improve the management of their intangible assets, they had to integrate the measurement of intangible assets into their management systems.After publication of the 1992 HBR article, several companies quickly adopted the Balanced Scorecard giving us deeper and broader insights into its power and potential. During the next 15 years, as it was adopted by thousands of private, public, and nonprofit enterprises around the world, they extended and broadened the concept into a management tool for describing, communicating and implementing strategy.

Among these advances are the following: Strategy maps of strategic objectives Extending the concept to nonprofit and public sector enterprises 30



Measurement of strategic readiness of intangible assets Role for executive leadership Creating synergies through alignment of business and support units to corporate

strategy Using communication to create intrinsic motivation Deploying extrinsic motivation by aligning employees’ personal objectives and

compensation to strategic objectives Linking strategy and operations in a new closed-loop management system Creating the office of strategy management

The challenge of implementing the Balanced Scorecard by Beer Molleman highlighted that though many large companies use a performance measurement system like the Balanced Scorecard (BSC). However, many small and medium enterprises (SMEs) do not have a performance measurement system. Companies that start with a performance measurement system face difficulties with the implementation. This paper proposes some potential solutions based on their research literature.

Using a Balanced Scorecard in a Nonprofit Organization by Joel Zimmerman Since its invention in the 1990s, the balanced scorecard has won acceptance as a management tool in the for-profit sector. Now, nonprofits are becoming familiar with, and trying to use, balanced scorecards. This white paper explains gives critically important tips about how to adapt them successfully into the nonprofit world. Basic steps recommended are: 1. Get your Board of Directors and managers educated on the basics and committed to the effort. 2. Appoint someone on staff to be in charge of creating and maintaining the balanced scorecard. 3. Depending on your organization’s size, and the knowledge of the person you have placed in charge, you may need to hire a consultant to assist in this effort. 4. Build your scorecard categories to match what is in your strategic plan. Or, build your strategic plan around the categories you will use for the scorecard. Or, modify your existing strategic plan so its matches the scorecard categories. 5. Derive the balanced scorecard measures, metrics, and analytical techniques and implement them in test mode for two or three months.

6. Use the test experience to improve the balanced scorecard measures and processes. 7. Begin to collect, analyze, report, and archive scorecard measures on a regular (e.g., monthly or quarterly) basis. For a balanced scorecard, as with all management buzzwords, the devil is in the details. Balanced scorecard is an easy concept to understand and highly appealing in theory. In



practice, it is a serious challenge to implement correctly. If you can do it, though, the benefits will be substantial and fully demonstrable.

Implementing A Balanced Scorecard In A Not-For-Profit OrganizationIn this paper the authors have described how the Balanced Scorecard approach has been implemented in a ReHabilitation Center. In implementing the Balanced Scorecard approach, the ReHabilitation Center has placed equal emphasis on the consumer perspective and the financial perspective. This equal focus is based upon the necessity of the Center to carry out its primary mission for its consumers (individuals with developmental disabilities) as well as the necessity to maintain financial stability within the Center. The emphasis on both of these perspectives has become a necessity in order for the Center to efficiently and effectively serve its customers. While the use of the Balanced Scorecard in the long range planning process for the Center is relatively new, the process has been accepted by the management of the organization. The challenge ahead for the Center is to continue to develop outcome measures for the individual departments within the Center and tie these outcome measures to the strategic objectives of the Center. It is recognized this is an extremely difficult process as real outcomes are not easily measurable. The formulation of outcome measures is a continuous development process. It is felt this process will definitely enhance the efficiency and effectiveness of the ReHabilitation Center in the long run.

The Business School Strategy: Continuous Improvement by Implementing the Balanced ScorecardCharles J. Pineno The current environment demands increasing accountability from business schools especially those schools seeking AACSB accreditation. The proposed framework centered on the Balanced Scorecard approach offers an alternative for developing and implementing a strategic performance management system in a business school.

Best Practice for Implementing the Balanced Scorecard By Yasar Jarrar and Mohamed Zairi Measurement is not an end in itself, but a tool for more effective management. The results of performance measurement will tell you what happened, not why it happened, or what to do about it. In order for an organization to make effective use of the results of performance assessment, it must be able to make the transition from assessment to management. It must also be able to anticipate needed changes in the strategic direction of the organization, and have a methodology in place for effecting strategic change. Successful accomplishment of these two tasks represents the foundation of good performance management. Both of these tasks can be greatly facilitated by use of the Balanced Scorecard. In other words, besides simply assessing performance, the Balanced Scorecard provides a structured framework for performance management.

Introduction to Industry

FERTILIZER INDUSTRY IN INDIA



The fertilizer industry in India consists of three major players: The Government owned Public Sector Undertakings, Co-operative Societies like IFFCO, KRIBHCO and units from Private Sectors. There are about 33 major producers producing NPK fertilizers in the country at present. The fertilizer industry of India had made constructive use of the fertilizer provided by the Government of India, to ensure that the country achieved reasonable self-sufficiency in food grains production. The fertilizer industry has organized itself through Fertilizer Association of India (FCI) to co-ordinate with the Government of India to achieve the macro-economic objectives related to agricultural sectors and to provide other services.

Introduction of IFFCO

3 November 1967: Indian Farmers Fertilizer Cooperative Limited (IFFCO) was set up at the initiative of the farmers. It soon emerged as a role model for cooperatives. IFFCO is registered under the Multi-State Cooperative Societies Act 1984, which was amended in 2002. Beginning with a membership of 57 societies, it has grown to around 40,000, as on 31 March 2008. The initial equity capital of Rs 6 lakh has jumped to Rs 423.93 crore. A pioneer in this field, IFFCO’s growth reflects its belief in the strength of the farmer. Several prestigious awards stand testimony to the fact that IFFCO is driven by its values and the dedication of its people. This is an organization that believes in fair play and has always followed transparent and professional practices in corporate governance. Over 40 years ago, the Government and the farming community came together with a single objective: to empower lives. Thus was born IFFCO, the world’s largest Fertilizer cooperative.

IFFCO’s mission is to enable Indian farmers to prosper through the timely supply of reliable, high quality fertilizers and farm inputs and services in an environmentally sustainable manner and to undertake activities to improve their welfare. This is the success story of an organization that has the vision to grow; it is a story that has been scripted with the best intentions— to benefit the farmer and to spread smiles across the nation.Indian Farmers Fertilizer Cooperative Limited (IFFCO) is a multi-state cooperative society engaged in production and distribution of chemical fertilizers. Registered on 3.11.1967, the Society commissioned its first two plants at Kalol and Kandla in Gujarat in 1975 for production of Urea and NPK/DAP, respectively. It expanded its production facilities in 1981 by commissioning two additional streams of phosphatic fertilizers at Kandla and a new urea plant at Phulpur. Another gas-based plant was commissioned in 1988 at Aonla, Uttar Pradesh. In the year 2005, IFFCO took over the Phosphoric Acid, Sulphuric Acid and NPK/DAP plant of M/s Oswals Ltd, Paradeep.

Further, during the period 1996 to 1999, the installed capacity of all the three ammonia/urea plants at Aonla, Kalol and Phulpur was doubled by expanding. The capacity was raised from 16.2 lakh tons to 32.2 lakh tons. The Kandla unit was also expanded and the new plant was commissioned on 5th August, 1999. The annual capacity of NPK/DAP was increased from 9 lakh tons to 16 lakh tons of bulk fertilizer or 3.09 lakh tons to 5.61 lakh tons of P2O5 output.



VISIONRetain dominant position in Indian Fertilizer Sector, improving its position further by achieving sustainable and viable growth through excellence in all its activities and gearing itself to fulfill the diverse expectations to stake holders, customers, employees and society.

Vision 2015 Installing ammonia and urea plants and acquiring fertiliser units Meeting feedstock requirements Generating power Producing and marketing micro-nutrients, seeds, bio-fertilizers and pesticides Value-addition to agri-products and marketing Offering IT-enabled services

MISSION To provide to farmers high quality fertilizer in right time and in adequate quantity

with an objective to increase crop productivity

To make plants energy efficient and continually review various scheme to converse an energy

Commitment to health, safety, environment and forestry development to enrich the quality of community life

Commitment to social responsibility to strong social fabric

To institutionalize core value and create a culture of team building, empowerment and innovation which would help in incremental growth of employees and enable achievement of strategic objectives

Building a value driven organization with an improved and responsive customer focus. A true commitment to transparency, accountability and integrity in principle and practice

To acquire, assimilate and adopt reliable efficient and cost effective technology and sourcing raw materials of production of phosphatic fertilizers at economical cost by entering into joint venture outside India

To ensure growth in core and non-core sector

A true cooperative society committed for fostering cooperative movement in the Country



Emerging a dynamic organization, focusing on strategic strengths, seizing opportunities for generating and building upon path success, enhancing earning to maximize share holders value.

S

UNITS OF IFFCOKandla



Phulpur

Kalol

Aonla

Paradeep



IFFCO’s KANDLA PLANT

IFFCO’s Kandla plant is located on the western bank of Kandla creek adjacent to Kandla Port Trust oil Jetties.

The plant produces NPK/DAP complex phosphatic fertilizers of various grades, namely NPK grades 10:26:26, 12:32:16 & DAP 18:46:00 in terms of N:P2O5:K2O.

The plant, originally consisting of only 2 streams A&B and related facilities was designed & erected by M/s Dorr Oliver Inc. USA at a cost of Rs. 30 crores with an annual licensed capacity of 1,27,000 MT P2O5. The plant was commissioned on 26th Nov. 1974 and commercial production declared on 1st Jan, 1975.

With increased demand for complex fertilizers, the capacity was doubled by addition of two more streams C & D designed & erected by HDO at a cost of Rs. 28.80 crores. Licensed capacity was increased from 1.27.000 MT P2O5 per annum to 2,60,000 MT P2O5 per annum. The expanded unit was commissioned on 4th June 1981 and the commercial production was started from 6th Sept. 1981. Subsequently due to introduction of production of DAP grade, the total capacity increase to 3.09,000 MT per annum of P2O5.

IFFCO went in for expansion of their unit at Kandla in 1996-97. Kandla phase-II NPK/DAP project conceptualized the setting up of two additional E & F streams for manufacture of the same grades of NPK/DAP fertilizers with an annual production capacity of 2,10,700 MTPA thus increasing the total capacity from 3,09,000 MTPA of P2O5 to 5,19,700 MTPA of P2O5. The actual cost of the project was Rs. 205.30 crores against a budgeted cost of Rs. 212.20 crores.

The main consultant for the NPK/DAP plant was M/s Hindustan Dorr Oliver, Mumbai with the pipe reactor technology obtained from process licensor M/s Grande paroisse, France. The construction of E&F streams was completed 77 days ahead of schedule. The E & F streams were commissioned on 10th June 1999 & 9th July 1999 respectively and the commercial production started from 5th August ,1999.

Production & Operation Department

The following fertilizers are manufactured at IFFCO – Kandla:Product N:P2O5:K2O

NPK GR 1 10:26:26NPK GR 2 12:32:16DAP 18:46:00

These products are distributed all over the country through IFFCO’s marketing and state cooperative marketing network.



Product Capacity TechnologyP2O5 9,10,000

Four streams (A,B,C & D) based on TVA slurry granulation process.

‘N’ 3,51,540 Two streams (E & F) based on AZF Pipe Reactor

The Kandla unit has its production in two phases:Phase 1 (Streams A,B,C,D)Phase 2 (Streams E & F)

Process Description of KANDLA Phase-1

KANDLA phase 1 consists of four identical streams with common raw material, product handling, product storage and bagging facilities. The manufacturing is taking place with conventional granulation process which consists of ammonization of slurry formed with 1:4 mole ratios with the help of vertical agitated vessel known as PN tank. About 70% of total requirement end into tank and 30% of it feed as a scrubbing medium to bring nutrient back to the system. The exothermic reaction taken place between ammonia and phosphoric acid which become slurry containing about 18-20% of water which feed in granulator if any further ammonization is needed can be satisfied with the help of extra supply of ammonia or urea. Here mole ratio maintains is about of 1:80 along with addition of raw material mainly available according to grade to be produced .The addition of Potash, filler and recycle material is carried out at this stage only. The granulator discharge is having about 2.5% of moisture which is send further for drying operation The discharge is of dryer getting dried with the help of co- current flow of hot air resulting from combustion of furnace oil. The dried material discharge is elevated with the bucket type elevator and feed it to double deck vibrating screen. The screen separate oversize and undersize products. The oversize product further crushed in pulverizes and sent to the granulator. The amount of product is taken at cooler where temperature is bringing down with the help counter current flow of air. The discharge from cooler over common product conveyor which carries product from all steams to storage silos. Steam is generated at boiler plant. Steam is used for flushing pipelines, vessels and slurry nozzle of granulator.

The scrubbing system is distributed in four areas. Fumes scrubber, Dryer scrubber, cooler scrubber and dust scrubber. Scrubbing is carried out by circulating dilute phosphoric acid termed as scrubber effluent. Dust scrubber collects nutrient from various areas like elevator, conveyor, and pulverizes. Unreacted ammonia is collected from granulator which is scrubbed with liquor and liquor is further sent to the vessel. Each scrubber is provided with a fan for creating the required draft. The scrubbed gases are let out into the atmosphere through a common stack.



2 C.) Production Process :- Basic Operation Process NPK -1 Plant

2 D.) Manufacturing Process Description :-List of devices :

PN Tank Slurry Pump Granulator Dryer Primary Elevator Screen Drug Feeder Vibrating Screen Fines Conveyor Secondary Elevator.

Process : In the PN tank , Phosphoric acid, Ammonia acid and Scrubber liker are added. With the help of Agistator, all three are mixed up. The slurry pump pushes the mixture forward into the granulator.


Phosphoric acid

Scrubber Liker

Ammonia Acid

Agistator

SlurryPump

Granulator

15% - 20%

Dryer2%-5%

Fines Conveyor

Potash

Urea Filler See

ds

Secondary Elevator

Product

Bagging

1.4 Mole Size

USP

OSP

Primary Elevator

Vibrating Screen

Screen Drug Feeder

Hot Air is passed


In granulator the atmospheric temperature is about 15-20 %. While passing out through the granulator the liquid mixture comes in form of

GRANULES. When the granules are passed in the dryer, the temperature in increased through

passing HOT AIR. Through primary elevator, the granules pass into the Screen Drug Feeder. Different size of granules vibrate on the vibrating screen and he granules which

are of 1.4 mm pass through the product and then to bagging plant. Rest of larger / smaller size moves to the conveyor in which again the raw

materials are mixed and the whole process is repeated, as they pass through secondary elevator into the PN tank.

Process Description of KANDLA phase-2

KANDLA phase-2 consists of two steams E and F. Here process of slurry formation taken place in pipe reactor which is installed in granulator so here no need of PN tank. The feed from granulator send to the dryer same process obtain in the process description of phase 1. The recycle system is same which is described in phase 1. The off gases from dryer and cooler first passed through cyclones and then it passes through wet scrubbing. The off gases from the granulator are first scrubbed in an inclined venture scrubber followed by a wet scrubber and a cyclonic spray tower. The exit gases from both dryer and granulator further sent to tail gas scrubber for maximum recovery of ammonia .Dust scrubber is also provided to collect a very small particles based on cyclone and wet scrubbing system. The scrubbing medium is weak phosphoric acid which is later consumed in DPR and GPR.

Inventory Management

The usual level of inventory varies widely in two categories viz imported and indigenous items. The level in case of imported items varies from 18 - 24 months. This is due to the fact that it comprises of both lead time for import formalities as well as suppliers lead time to deliver the material at Users point. For indigenous goods, we have two sub-categories of items:

1. Non-stock items &2. Stock items.

Non Stock Items:



The non-stock items are tailor made and hence their procurement time is long. These items are generally costly and difficult to stock. These items are generally procured by users themselves.

Stock Items:

Stock items are mostly everyday items & generally available off the shelf. These items are usually not very costly ( C class).For non-stock indigenous items, we have to keep inventory worth of 9 months where as for stock items; the inventory to be maintained is worth of 6 months.

Inventory:

This is a quantum of Raw Materials for Production i.e. spares, components & all other general items required for maintenance and services. This covers the total number of items held in Stores which is around 28996 Nos. (as on March, 2007).

These items have been categorized as:

1. Stock items: 759 items. 2. Non Stock items: 28237 items.

Lead Time:

In simplified terms lead time is the time taken to procure the material. It commences from the time indent is raised & lasts till the material is received in Stores, inspected, binned and ready for issue to the indentor/user.

At Kandla the lead time is base on the following:1. MPR preparation and documentation: 5 days.2. Enquiry: 25 days.3. Processing time: 20 days.4. Order to party: 10 days.5. Party’s delivery time: 30 days.

90 days.

Finance & Accounts Department

Sections of Finance & Accounts Department

1. Financial Concurrence Section:This Section is divided in two Subsections. They are as follow:a) Purchase Orders b) Work Orders


HUMAN RESOURCE

MANAGEMENT

Personnel

Legal/IR Welfare

Public Relation

Administration

Hindi Cell

Time Office

Estate

Public RelationHindi Cell

Time Office

Estate

Administration

Hindi Cell Time Office


2. Raw Material Section:This Section includes three subsections. They are as follow:

a) Raw Material Accounting b) Customs clearancec) Excise clearance and Chemicals / Utility Payments etc.

3. Insurance Payment & Accounting Section4. Fixed Assets Section5. Books Section6. Pay Roll Section7. Packing Materials Section8. Miscellaneous Section9. Cash & Bank Section10. Purchase Bills payable Section

Human Resource Management

PERFORMANCE APPRAISAL

Performance Appraisal is the systematic evaluation of the individual with respect to his/her performance on the job & his/her potential development. The performance being measured against such factors as job knowledge, quality & quantity of output, job



performance, leadership abilities, supervision, dependability, co-operation, discipline, health & potential for development.

Objective of Performance Appraisal

To effect promotions based on competence & performance

To assess the training & development need of employees

To help considering employees suitability for different types of assignments, transfer & placement.

To let the employee know where they stand insofar as their performance is concerned and to assist them with constructive criticism & guidance for the purpose of their development.

Performance Appraisal in IFFCO

For the different Grades there are different appraisal forms.

1. Performance Appraisal form for Grades H2 and below2. Performance Appraisal form for Grades H1and above

In applying and using the appraisal system it will have three phases:

Reporting Evaluation Follow-up

The rating of the employees should be done annually at one time. The first page of the appraisal format is to be filled by the Personnel Department and passed on to the Appraising Officer by 1st week of April who will give his rating by 10th April and send it to the Reviewing Officer and from him to the Accepting Officer. The Accepting Officer after recording his observation on the appraisal of the employee will send the report Personnel Department latest by the end of April.

The instruction provided in the appraisal form to be carefully gone through by individual appraiser bearing in mind that the rater will be rated eventually.

In case of disagreement among the Appraising and Reviewing Officer, the Accepting Officer should hold discussions with all of them and finalize rating.



In case performance of the employee is Below Average or excellent, same shall be communicated by Personnel Department to M.D after the appraisal is accepted by the Competent Authority.

Objective(s)

Primary objective: To understanding the requirement of implementing BSC at IFFCO

Secondary objective: Comparing traditional PMS tools with BSC and its effectiveness

Rationale for selecting this topic: As BSC is acknowledged as effectives PMS tool, we would like to study the possibility of implementing the same in a co-operative manufacturing unit like IFFCO.

Methodology

Data collection methods

Primary data:Review of existing PMS at IFFCOInterviews of Executives at IFFCO

Secondary data:Study of Vision/Mission statement of companyResearch PapersCompany’s website Published materialsCompany’s manual and reports

Findings and analysis:

Limitations:


feasibility study of implementing balance scorecard at iffco

Documents

balanced scorecard approach

balanced scorecard paradigm

balanced scorecard bsc

nonfinancial measures

traditional financial

financial perspectives

future financial performance

strategic management