kerala automobiles ltd

AN ORGANIZATIONAL STUDY AT KERALA AUTOMOBILE LTD…. Prepared by Sandeep Nair

INTRODUCTION

The main aim of organizational study is familiarization & in depth knowledge of the

functioning of various departments. For this purpose a study has been carried out in Kerala

Automobiles Ltd. The KAL has primary position to auto industry. For that purpose a study

has been carried out in Kerala Automobiles Ltd. The KAL has a decent position in the

auto industry which manufactures three wheelers with high power, fuel efficiency, strong

chassis, metal body, high load carrying capacity, and with trouble free operation. The

better the organization greater will be the achievement of common objective. Organization

structure is an indispensible means to the end of business performance. This fact makes

appropriate a thorough organization study of an industrial unit.

1.1 Objectives Of The Study

Getting organizational exposure.

To see and understand the actual working condition of an organization.

To understand the organization on the basis of departmentation.

To understand the functions of each and every departments.

To look in to the working conditions of the employees in an organization.

To learn the basic HR functions in the organization.

To make the evaluation about the performance of the organization.

To know about the organizational objective and scope.

To know the extend with which management theories matches with the practice.

To do the ‘SWOT’ analysis of the company.

To suggest recommendations for improving the overall performance of the

organization.

To get clear view of the day to day functioning of the industrial establishment.

1.2 Scope Of The Study

To study working environment

To study the employer-worker relationship.

To study the profit making of the organization.

How man, material, money influence on the achievement of company.

To learn the HR functions of the organization.

To learn the Industrial Relations functions in the company.

1.3 Methodology

MOUNT ZION COLLEGE OF ENGINEERING


The study the study pays more attention on the process that takes place in the various

departments of KAL, organizational structure and operations management of various

departments of KAL.

Data sources

Data source is the source form where the data are collected and arranged. There

are two kinds of sources. Primary source and secondary source.

Primary source:- Primary data are collected for the first time. It’s is obtained through

the personal interview with the manager as well as some employees. Observation was

systematically planned and recorded. The personal interview was direct and was a

mixture of direct, structured and unstructured questions. The type observation used

was structured and controlled one. The opinion of the different people may be

different for a question. So, a keen observation and extraction of fact has carried out

with the help of the formal authorities.

Secondary data:-These are data collected from the various journals, brochures,

websites, newspaper etc. The company details and data have been personally gathered

from company profile, annual report documents and other published booklets.

1.4 Duration Of The Study

The duration of study was one month starting from 3-5-2010 to 31-5-2010.

1.5 Limitations Of The Study

Time was limited for a deep study analysis of the organization.

Some personal interviews may be affected by the personal bias.

Some company documents are confidential in nature. So, it was not possible to

include all those items.

Organizational environment was very busy, which limits the data collection,

learning. All the information couldn’t be involved because of this factor.



2.1 INDUSTRIAL PROFILE OF AUTOMOBILES

In 1769, the self propelled vehicle was a military tractor invented by French engineer

and mechanic, Nicholas Joseph Cugnot. He built a steam powered tricycle that carried

4 passengers. But in 1832-39 Robert Anderson of Scotland invented the first electric

carriage.

The history of the automobile begins as early as 1769, with the creation of steam-

powered automobiles capable of human transport. In 1806, the first cars powered by

internal combustion engines running on fuel gas appeared, which led to the

introduction in 1885 of the ubiquitous modern gasoline- or petrol-fueled internal

combustion engine. Cars powered by electricity briefly appeared at the turn of the

20th century but largely disappeared from commonality until the turn of the 21st

century, when interest in low- and zero-emissions transportation was reignited. As

such, the early history of the automobile can be divided into a number of eras based

on the prevalent method of automotive propulsion during that time. Later periods

were defined by trends in exterior styling and size and utility preferences.

Pioneer Inventors

German engineer Karl Benz, inventor of numerous car-related technologies, is

generally regarded as the inventor of the modern automobile. The four-stroke petrol

(gasoline) internal combustion engine that constitutes the most prevalent form of

modern automotive propulsion is a creation of German inventor Nikolaus Otto. The

similar four-stroke diesel engine was also invented by a German, Rudolf Diesel. The

hydrogen fuel cell, one of the technologies hailed as a replacement for gasoline as an

energy source for cars, was discovered in principle by yet another German, Christian

Friedrich Schönbein, in 1838. The battery electric car owes its beginnings to

Hungarian Ányos Jedlik, one of the inventors of the electric motor, and Gaston Planté,

who invented the lead-acid battery in 1859.


http://en.wikipedia.org/wiki/Germany

http://en.wikipedia.org/wiki/Lead-acid_battery

http://en.wikipedia.org/wiki/Gaston_Plant%C3%A9

http://en.wikipedia.org/wiki/Electric_motor

http://en.wikipedia.org/wiki/%C3%81nyos_Jedlik

http://en.wikipedia.org/wiki/Electric_car

http://en.wikipedia.org/wiki/Christian_Friedrich_Sch%C3%B6nbein

http://en.wikipedia.org/wiki/Christian_Friedrich_Sch%C3%B6nbein

http://en.wikipedia.org/wiki/Fuel_cell

http://en.wikipedia.org/wiki/Rudolf_Diesel

http://en.wikipedia.org/wiki/Diesel_engine

http://en.wikipedia.org/wiki/Nikolaus_Otto

http://en.wikipedia.org/wiki/Internal_combustion_engine

http://en.wikipedia.org/wiki/Petrol_engine

http://en.wikipedia.org/wiki/Four-stroke_engine

http://en.wikipedia.org/wiki/Karl_Benz

http://en.wikipedia.org/wiki/Engineer


Modern Automobile Industry

The automotive industry crisis of 2008–2010 was a part of a global financial

downturn. The crisis affected European and Asian automobile manufacturers, but it

was primarily felt in the American automobile manufacturing industry. The

downturn also affected Canada by virtue of the Automotive Products Trade

Agreement.

In 2008, with rapidly rising oil prices, industries such as the automotive industry, are

experiencing a combination of pricing pressures from raw material costs and changes

in consumer buying habits. The industry is also facing increasing external competition

from the public transport sector, as consumers re-evaluate their private vehicle usage.

Roughly half of the US's fifty-one light vehicle plants are projected to permanently

close in the coming years, with the loss of another 200,000 jobs in the sector, on top

of the 560,000 jobs lost this decade.

The global automotive industry is a highly diversified sector that comprises of

manufacturers, suppliers, dealers, retailers, original equipment manufacturers or

OEMs, aftermarket parts manufacturers, automotive engineers, motor mechanics, auto

electricians, spray painters or body repairers, fuel producers, environmental and

transport safety groups, and trade unions.

The automobile and automotive parts & components manufacturers constitute a

major chunk of automotive industry throughout the world. The automotive

manufacturing sector consists of automobile and light truck manufacturers, motor

vehicle body manufacturers, and motor vehicle parts and supplies manufacturers. This

sector is engaged in manufacturing of automotives and light duty motor vehicles,

motor vehicle bodies, chassis, cabs, trucks, automobile and utility trailers, buses,

military vehicles, and motor vehicle gasoline engines.

The Top Automaking Nations

United States, Japan, China, Germany and South Korea are the top five automobile

manufacturing nations throughout the world. The United States of America is the

world's largest producer and consumer of motor vehicles and automobiles accounting

for 6.6 million direct and spin-off jobs and represents nearly 10% of the $10 trillion


http://www.automotive-online.com/auto-industry.html


US economy. Automobile is one of the important industries in the world, which

provides employment to 25 million people in the world.

Major Manufacturing Regions

Northeastern United States and Southern Great Lakes Region, Northwestern Europe,

Western Russia and the Ukraine, and Japan are the major manufacturing regions of

automotive in the world.

In North America, the prominent automotive manufacturing regions are New

England, New York and the Mid-Atlantic, Central New York, Pittsburgh/Cleveland,

Western Great Lakes, St. Lawrence Valley, Ohio and Eastern Indiana, Kanawha and

middle Ohio Valley, St. Louis, the Southeastern region, Gulf Coast, Central Florida,

and the West Coast.

The European Union has the largest automotive production regions in the World. The

key automobile manufacturing regions are United Kingdom, Rhine-Ruhr River

Valley, Upper Rhine - Alsace - Lorraine region, and the Po Valley in Italy.

In the Western Russian and Ukraine Region, the leading industrial regions are

Moscow, the Ukraine region, the Volga region, the Urals regions, and the Kuznetsh

Basin Region.

Major Segments Of Automotive Industry

Auto components amount to 31.5% share of the global automobiles and components

industry group's value. The global automotive component industry is highly diverse

and comprises of various product segments like engine parts, drive transmission and

steering parts, suspension & braking parts, electrical parts and other auto components

parts.

Engine Parts segment in the automotive component industry comprises of different

parts like engine parts, fuel delivery system and products such as pistons, piston rings,

engine valves, carburetors, and diesel-based fuel delivery systems. Engine parts form

one of largest product segment of the automotive components industry and have a

production share of 31%. A technology intensive segment, engine parts are moving

towards improved designs for optimal fuel consumption and lesser emission. The

latest trend in this sector is of outsourcing a part of the engine from vendors.


http://www.automotive-online.com/auto-industry.html

http://www.automotive-online.com/engine/piston-rings.html

http://www.automotive-online.com/suspension-steering/steering-parts.html


Electrical Parts segment comprises of generators, starter motors and spark plugs. An

important and relatively larger product segment - engine parts are gaining popularity

at a faster pace in the global automotive parts & components industry. Electric start

mechanism in different scooter and motorcycles is the latest concept in the automobile

industry. Electrical parts sector contribute around 9% to the auto components

industry.

Drive Transmission and Steering Parts segment has sub segments like gears,

wheels, steering systems, axles, and clutches. Having 19% share, this segment is

considered the largest product segment after engine parts segment. The emergence of

different leading automotive manufacturers is intensifying the competition in the

sector especially for products like gears and clutches

Suspension and Braking Parts segment comprises of automobile components like

brakes, brake assemblies, leaf springs, shock absorbers, brake linings. Suspension and

braking parts segment has around 12% share in the global auto component industry.

Body and Chassis Parts segment comprises of body and chassis, sheet metal

components, and plastic-molded parts. The global sourcing of automotive

components comprise of chassis, frames, brakes, steering and much more has reached

to US $ 185 billion in 2008-09. This product segment has 12% share in the global

automotive component and parts industry.

Market Forecasts

Global Auto Components Forecast Value - USD billion 2004 -

2009

Year USD billion % Growth

2004 515.5 2.30

2005 526.2 2.10

2006 538.9 2.40

2007 553.4 2.70

2008 569.1 2.80

2009 585.9 3.00

CAGR 2004 - 2009 : 2.6%


http://www.automotive-online.com/speciality-products/automobile-sheet-metal-components.html

http://www.automotive-online.com/speciality-products/automobile-sheet-metal-components.html

http://www.automotive-online.com/suspension-steering/leaf-springs.html

http://www.automotive-online.com/transmission-system/gear.html

http://www.automotive-online.com/transmission-system/clutch.html

http://www.automotive-online.com/electrical-system/spark-plugs.html


World 3 wheeler market

It is not only the cars, consumer vehicles and two wheelers that are sold in these

various countries in large numbers, but the three wheeler market is also quite big in

these nations. You will get to see innumerable three wheelers running on the roads of

various Southeast Asian countries like India, Thailand, Sri Lanka, Pakistan,

Philippines, Nepal, and Bangladesh etc.

There are a number of reasons that have resulted into the proliferation of the three

wheelers in umpteen countries. Three wheelers are quite economical in terms of

manufacturing and maintenance. They have also earned huge popularity due to their

easy maneuvering capabilities through the narrow lanes that are prevalent in most of

the developing countries.It is not that three wheelers are used only in the developing

nations.

Three Wheeler Companies

You will also get to see various brands of three wheeler in different parts of US, UK

and some of the European nations. Reliant and Morgan Motor Company are the two

major three wheeler manufacturers in UK. One of the US based three wheeler

manufacturers; ZAP has even come up with eco-friendly three wheelers that operate

with battery. Bajaj Auto, Piaggio is the leading players in the three wheeler industry in

most of the Southeast Asian nations.

The vehicles have also given rise to the three wheeler accessory industry in many

countries. It is believed that numerous people have got employed in various countries

due to these three wheelers. Apart from serving the daily need of the commuters the

three wheelers also play commendable role in the transportation of several

commodities. Seeking the increasing demand of three wheelers, more automobile

companies are considering manufacturing these vehicles.

INDIAN AUTOMOBILE INDUSTRY

The automobile industry in India is the ninth largest in the world with an annual

production of over 2.3 million units in 2008. In 2009, India emerged as Asia's fourth

largest exporter of automobiles, behind Japan, South Korea and Thailand.



Following economic liberalization in India in 1991, the Indian automotive industry

has demonstrated sustained growth as a result of increased competitiveness and

relaxed restrictions. Several Indian automobile manufacturers such as Tata Motors,

Maruti Suzuki and Mahindra and Mahindra, expanded their domestic and

international operations. India's robust economic growth led to the further expansion

of its domestic automobile market which attracted significant India-specific

investment by multinational automobile manufacturers. In February 2009, monthly

sales of passenger cars in India exceeded 100,000 units.

Embryonic automotive industry emerged in India in the 1940s. Following the

independence, in 1947, the Government of India and the private sector launched

efforts to create an automotive component manufacturing industry to supply to the

automobile industry. However, the growth was relatively slow in the 1950s and 1960s

due to nationalization and the license raj which hampered the Indian private sector.

After 1970, the automotive industry started to grow, but the growth was mainly driven

by tractors, commercial vehicles and scooters. Cars were still a major luxury.

Japanese manufacturers entered the Indian market ultimately leading to the

establishment of Maruti Udyog. A number of foreign firms initiated joint ventures

with Indian companies.

In the 1980s, a number of Japanese manufacturers launched joint-ventures for

building motorcycles and light commercial-vehicles. It was at this time that the Indian

government chose Suzuki for its joint-venture to manufacture small cars. Following

the economic liberalization in 1991 and the gradual weakening of the license raj, a

number of Indian and multi-national car companies launched operations. Since then,

automotive component and automobile manufacturing growth has accelerated to meet

domestic and export demands



2.2 COMPANY PROFILE

Kerala Automobiles Limited (KAL) incorporated in 1978 as a Government of

Kerala undertaking, is set up in the picturesque back drop, 16 kilometers south of

Thiruvananthapuram in a tiny village called Aralumoodu, in Neyyattinkara taluk. The

Company manufactures Three Wheelers (Diesel, Petrol & CNG) suitable for

passengers and goods traffic in the brand name of KERALA and are considered as

most Eco-friendly vehicles.

KAL started production with 164 employees where capacity of production was 52

vehicles per year. Initial technology of production was in collaboration with API

Mumbai and from 1987 it has developed its own tehnology of production.

KAl staretd with a production of petrol engine three wheelers from 1988 it began to

produce ‘diesel engine’ three wheelers.KAL is the first company to introduce diesel

engine three wheelers in the country.At present company is concentrating in the diesel

versions only.

The present product range comprises of Autorickshaw (Three/Six seater), Pickup/

Delivery Van, Three Wheeler Tipper of Diesel version and Pollution free CNG fitted

Auto and Load carriers etc. The strong, highly motivated work force in the Technical

and Management cadres are working hand in hand for the progress of the Company.

The ancillary units developed by the Company around the factory complex provide

livelihood for hundreds of families.

Since commencement of production in 1984, the Company has manufactured and

marketed more than 1,20,000 Three Wheelers. KAL has distinguished itself as a force

worth reckoning in the Automobile industry in India. The Company has also exported

a number of Three Wheelers to Bangladesh, Sri Lanka, Nepal, Sudan, Botswana,

Nigeria, South Africa,Egypt and Guatemala (Central America). The Company could

turn the corner for the first time in 1993-94 and continued to keep the same trend at a

higher level. The acceptability of KAL Three Wheelers in the Third World countries

speaks for its utility and quality. KAL is also manufacturing sophisticated components

to be used in space programs of VSSC/ISRO.The company has the capacity to produce

nearly 7500 vehicles per year.



The Company is getting all kind of support from the Government of Kerala, without

which it would not have been possible to achieve the present level of promising state

of affairs. KAL is awarded with ISO 9001:2000 Certification envisaging total quality

management (TQM). It is the unflinching faith of our customers, which has powered

KAL into the path of progress and looking forward for continued patronage at a higher

rank.

Date of incorporation: 15th March 1978

Address & registration: Athiyanoor,

Aralumoodu,

Thiruvananthapuram-

(dist),PIN:695123

Phone & website: 2222640, www.keralaautomobilesltd.com

Name of chairman: Divakaran

Name of MD: K P Vijayakumar

Vision

“To become top three wheeler manufacturer in 10 years.”

Mission

“To provide value added service and product to the customers and to earn

reasonable profit.”

Quality Policy

The management and employee are committed to develop, manufacture, market

and service three wheelers enhancing customer satisfaction through a process of

continual improvement of its quality management style.

Products

1) Kerala GL 400 V2 electric start chassis- Rs 76,000

2) Kerala GL 400 V2 rope start chassis – Rs 74,000

3) Kerala Gl 400 V2 MX 400 electric start chassis- Rs 83,000

4) Kerala GL 400 V2 rope start - Rs 77,000

New products

1) Self start (340cc) petrol engine [CNG]

MOUNT ZION COLLEGE OF ENGINEERING Page

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2) Self start (340cc) gas engine

2.3 ORGANISATIONAL CHART

The board of directors manages the affairs of company. The government

of Kerala determines the members of the board.The members are

determined by the government in a conservative way. The number shall

not be less than two and not more than nine. The government appoints the

director including the full time directors.The directors need not hold

shares. They frame policies requires for the company to achieve its goals.

The managing director will execute the affairs of company through the

managers in different departments. It consists of

I. Chairman

II. Managing directors

III. A nominee from finance department

IV. A nominee from industries department

V. A nominee from the government

The MD is always responsible for the conduct of managers of the

company subject to overall control and supervision by board of directors.

The general shall be in charge of company where MD is not present. In

such cases, he or she shall take decision on financial matters in

consultation with financial controllers.


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ORGANISATIONAL HIERARCHY


12

BOD

MANAGING DIRECTOR

DEPT .GENERAL

CHAIRMAN

MANAGER

ASSISTANT MANAGER

SENIOR ENGINEER

SALES EXECUTIVE

JUNIOR ENGINEER

WORKERS

COMPUTER PROGRAMER


ORGANISATIONAL STRUCTURE


13

Jr.Personnel Officer Asst.Personnel Officer

BOD MDCHAIRMAN

Store dept

Fin dept

PDN dept

Mkt dept

H.R dept

Plang dept

QA dept

R&D dept

Purc dept

Maintance

Administration

GMM

Manager

Asst MGR

Manager

Manager

Manager

Sr.Engg

GMF

Manager

Manager

Asst MGR

Asst MGR

TR.Executive

Asst MGR

Sr.Engg

Jr.Engg

Sr.Engg

Asst MGR

Sr.Officer Supplier

Devlop

Asst.Mgr

Purchase

Sr. Engg

Subcontract

TR.Executive

Service&Spar

Asst. MGR

Marketing

Accounts Officer Jr.ExecutiveGMF

M/C Shop

FABRI

ASSEMBLY

TOOL ROOM

HEAT TREA

PAINTING

Asst. MGR

Engineer

WorkmenSr. Engineer Jr. Engineer

Jr. Engineer Workmen

WorkmenJr. EngineerSr. Engineer

WorkmenJr. Engineer

Workmen

Workmen

Jr. Engineer

Sr. Engineer


2.4 PRODUCT PROFILE

Petrol models

P1 petrol autorishaw, regular three seater (1984)

P2 Newlook Autorishaw (1988)

P3 petrol delivary van (1984)

P4 petrol pickup van (1984)

P5 petrol three wheeler chassis (1985)

Diesel models

D1 Diesel pick up van (1984)

D2 Diesel auto trailors (1988)

D3 Diesel chassis come under three models

1. 4360 Chassis- Self start

2. 4325 Shorter rope start

D5 Kerala MX 4000

D6 LGA 340 (ELECTRIC START)

Current moving products

Kerala MX 4000

Kerala V2 Diesel chassis ( Self & electric)


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ANALYSIS OF DEPARTMENTS AND WORKING

There are approximately 20 departments in KAL.The size of the department depends

on the importance and complexity of the function of department. The various

departments of KAL are as follows:

1) Human Resources Department

2) Administrative department

3) Sub-contract department

4) Research and development department

5) Purchase department

6) Finance department

7) Marketing department

8) Production department

9) Planning department

10) Machine shop department

11) Quality assurance department

12) Stores department

13) Maintenance department

14) Service and spare parts


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3.1 HUMAN RESOURCE DEPARTMENT

Department structure


16

HR DEPARTMENT

MANAGER

Asst. MANAGER

Jr. PERSONNEL OFFICERAsst. PERSONNEL OFFICER


Objectives

Reduce absenteeism from 10% to 5% in the course of one year.

Improve employee satisfaction by 10% using a survey of current situation at

the end of one year.

To enable individual employee to improve their efficiency by 5% in the course of

1 year.

Manpower planning

The number of employees in an organization is decided by the number of

products delivering.The Government decides the number of employees to be worked

for the company to achieve the targeted production It is called Employee Sanction

Strength.

The capacity of the plant is 7200 units/year.i.e, 600 per month.

Number of workers needed to make 1 vehicle is 20 workers per day.

Employee sanction strength= 20*(600/25)=480 workers.

The current sanction strength of employees of KAL is 495(shop floor wokers +

managerial category)

But since the current production rate is set as 300 units per month, the employee

strength is maintained as 250-260.

A problem that KAL facing : The 1/3rd of employees in the company are unskilled

workers, who were inducted at the beginning of the ompany.

Recruitement is a very carefull process to be done. Otherwise it will make

unnecessary losses in future.

Current manpower planning: the number of contract employees are checked based up

on the production.The work is being outsourced to the outside parties, if there arises

an immediate shortage.After getting the preffered output of production,the machinery

is used for the manufacturing of other products like coir spinning machines etc.

Its current plan is to maintain the level of production with minimum input.


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Recruitment and selection

There are three methods of recruitment

1) Direct Recruitment

2) Employment exchange

3) Public Service Commission

1) Direct Recruitment: Direct recruitment is done through advertisement in

newspaper.

2) Public Service Commission: The post of helpers, typist, office assistants, stenos,

clerical staff, drivers etc are done through PSC. Whenever there arise a need for

employees on such posts, it will be reported to PSC. But there is no such recruitment

in recent times since there is no need for such posts.

3) Employment exchange: This is done through the employment exchanges. This is

because of the Compulsory Notification act. The required number of candidates and

their qualifications are informed at the employment exchanges. The eligible

candidates are recruited and selected.

4)For higher posts, there will be interview only. In the interview board, there will be

members from board of directors, HR manager and the domain/subject expert

sometimes as per the direction from the government. Then the merit list is

published .Then fixed list is published for selected candidates.

Selection procedure

The first step to selection is written test, applicable to all category of

workmen. An interview is conducted for those who succeed in it. Applicants to

technical post undergo a trade test also.

Apprentices: Apprentices are selected from three sources.

Related Instruction Centre(RIC) - To recruit ITI candidates

VHSE board

Central Apprentice - For graduation & B.Tech (office is at Chennai)

Diploma holders are selected through supervisory development centre

kalamassery.


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Induction

An induction program will be given to all the candidates who join the KAL as

a fresher. They will be provided on the job training. Most of the time, their probation

period will be from six months to one year. After that, if the candidate’s performance

is satisfactory, he will be appointed as permanent.

Training and Development

After the intake of a permanent employee, he will be given training for 1

year. Permanent appointment is given after that. The training can be inside or outside

the organization. During the period of training, the basic pay alone is given. After

appointing the employee as permanent, he will be paid salary with all the kind of

benefits.

Apprentices and management trainees are appointed based on contract basis to get

trained in their domain areas. They will be given stipend only.

Employee Profile

Workmen re classified in to permanent workers, probationary, temporary and casual

workers. At present there are 255 permanent employees.

Employees can be classified based up on two norms, they are:

1) Based up on Standing order

2) Based up on wages of employees/wage settlement.

In KAL the employees are classified up on wage segment. They are

Officer category/managerial

Technical category/workmen

In KAL, the employees are classified in to two categories based on wage settlement.

They are :

1) Officer/managerial

2) Technical/Workmen

The detailed categorization is given in the pay scale structure below


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Number of employees in various departments

Department Permanent

Employees

Trainees Apprentice

Sub-contract

department

2 - -

Marketing 8 - 2

Maintenance 11 - 3

Store 15 - 3

Quality Assurance 18 - 4

Heat Treatment 2 - -

Tool Room - - -

Painting 9 - 3

Assembly 26 - 9

Fabrication 30 - 8

Machine Shop 55 3 19

Planning 5 - 1

Design & Drawing 7 2 4

Service & Spares 8 -

Administration 14 - -

HRD 15 3 2

Purchase 12 1 3

Accounts 15 2 2

General 4 - -

TOTAL 254 11 63

Working time

The working time in KAL is 8 hours per day. There are maximum 5 shifts in the

company.

(1) Executives : 9 am – 5 pm


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(2) Ministerial staff: 9.30 am – 5 pm

(3) Workmen : 9 am-5pm (general shift)

6 am – 2 pm (1st shift)

2 pm – 10 pm (2nd shift)

Attendance

The attendance of KAL is calculated through the punching system. The

employees punch their attendance card and the attendance will be registered in the

server. The salary is calculated based on this. For every minute late, the belated time

will be calculated and respective salary will deduct and causes ‘loss of pay’. Such

exception is only for the entry time of first 30 minutes. If the employee is late more

than 30 minutes, he has to take half day leave.

Wages and salary administration

There are two scale of pay. They are:

1) For officer segment( every 4 year revision)

2) For workmen segment( every 5 year revision)

Stipend

The trainees & apprentices are given stipend every month. Its as follows.

ITI - Rs 1440

Diploma - Rs 1850

Degree - Rs 2600

Management trainee - Rs 3000

SALARY RELATED TERMS

Dearness allowance(DA)

There are two type of DA.

1) Fixed DA /Government DA:


21


This is for the people of the managerial category. Fixed DA varies every

quarter. The current government DA is 123% of the basic scale of pay. This DA is

fixed by the government and is based on the salary point scale. It is as follows:

Fixed DA = (basic ×123) /100

2) Variable DA:

This DA is for workmen category. This is fixed by the government based on

Cost of Living Index/ Consumer Price Index (CLI/CPI). ‘Economic and

Statistics Department’ (Trivandrum, www.ecostat.kerala.gov.in) prepares

Consumer Price Index. This DA percentage varies according to the inflation

every month.

Calculating Variable DA (VDA)

To calculate Variable DA the following are necessary.

1 Base Point: It is determined at pay revision and it varies at every pay

revision. The current base point of KAL is 950.

2 Indices : It is the cost of living index of the month as in CLI

3 Points for each scale of pay. It is as follows:

Basic pay scale Points

Up to Rs 2950 3.95

Rs 2950-3500 4.20

Rs 3500-4001 4.75

Above Rs 4001 4.90

Steps to calculate VDA

Index of month(CLI) – Base point = Result

Point × Result = VDA of the month

Example:

Base Point of KAL = 950


22

http://www.ecostat.kerala.gov.in/


CLI (of February 2010 is) = 1839

Result = 1839-950

= 889

VDA of a work man having basic Rs 2950 = 889 × 3.95

= 3511.55 Rs

VDA of a work man having basic Rs 2950 upto 3500 = 889 × 4.20

=3733.8

About base point: Every pay revision, the base point is merged to the basic. Here

the base point is 950 and is already merged in the basic and the extra money

coming is calculated by subtracting 950 from CLI. In the next pay revision, the

authorities will decide up to what amount should be merged to the basic.

House Rent Allowance(HRA)

This is decided by the management with the understanding of labour unions. This

is revised every 5 years and further change in HRA is made.The current DA rate

are

Work men : Rs 350

Officer category : Rs 260

Adhoc pay

This is give to thoe employees who are eligible for promotion and not promoted yet

even after the time bound within which they have to be promoted. When adhoc pay is

added to the salary, the respective DA of adhoc pay is also given to the employee.

That is adhoc pay is added to the basic salary and its DA is calculated. When he got

promoted, the adhoc pay is removed and the new scale of pay to the promoted

position will be given.

Attendance bonus


23


If the employee takes only one leave in the month of 26/27 working days, he

will be eligible for Rs 25 attendance bonus.But if there are two leaves or ‘loss of

pay’, he won’t be eligible for the attendance bonus.

Gratuity

The employee will get 15 days’ salary as gratuity for one year’s work. The

employee will eligible to receive gratuity, when he completes minimum 5 years

service. As per gratuity act, in KAL while in service if any employee passes away, he

will get full gratuity amount up to his retirement age.

The base for calculating PF is 26 (working days a month).The amount used to

calculate gratuity is the ‘basic pay +DA(if exists)’.

Gratuity=15 day’s salary= [(basic+DA)/26] × 15

(This is equal to the 4.8% of annual salary[basic + DA(if exists)])

Gratuity amount at a particular year of service =

[(basic+DA)/26] ×15×Number of years of service*

*- Number of years of service : More than 6 months service will be counted as full

year of service.

i.e; 1 year 7 months will be counted as 2 years.

Incentives

Incentive is given to all the employees from top to bottom of the

organization, when extra production takes place. But since the current production is

limited, there is no incentive the employees.

Production (vehicles) Amount

300-325 Rs 2.00

326-350 Rs 2.50

351-510 Rs 3.00

Above 511 Rs 4.00


24


Washing allowance: Rs 30 per month is given to work men as washing allowance.

Stitching allowance: Rs 250 per year is given to workmen those who have uniform

and Rs 35 for women.

Risk allowance: Rs 50 per month is given to work assistants and helpers who

undertake operations like painting, heat treatment, ammonia pointing welding etc.

Special allowance: Rs 25 per month to senior tradesman.

Shift allowance: First shift – Rs.2.50

Second shift – Rs 3

Shoe allowance: Administrative department provides Rs 300 as shoe allowance in

every 8 months to every employee.

Provident Fund (as per PF act 1952)

12% of the salary (Basic + DA) is paid to Provident Fund account from the

salary of the employee. The same amount will be provided by the employer to the PF

account. The 12 % of both employee and employer is statutory. But the employee can

voluntarily pay additional amount more than 12% to the PF account. But the

employer don’t have to pay accordingly as the employee pays, other than employer’s

12% share.

Around 8.33% of the 12% of PF share of the employer will go to the Pension fund

of the employee.

The interest of the Provident Fund is 8%.

An employee can take money(as loan having no interest) from PF

account(employee share) twice in an year. He can also take money for education,

marriage(up to 60%), home construction(up to 90%) etc. The proof of such things

should be provided such as building plan, approval from authorities, engineer etc

for construction, marriage certificate copy, invitation etc for marriage after the

function and statement from bank etc for education. The employee may or may

not repay the amount taken from the PF account (as loan).Generally there is no

need to pay back the money. This loan amount is permitted from the employees

share of 12% of basic salary that he pays every month. The employee cannot take

money from the 12% of the employer’s share to PF.


25


The account section pays the PF in the bank with the ‘common PF account

number’ of the company and gives the chellan to HR section. The company has its

own single PF account number as whole for all the employees.Each and every

individual employee has their own personal PF account numbers. The HR

department prepare the list of employees with their individual PF account

numbers and sends it to the PF office along with the chellan.

If the monthly PF of an employee is not paid by the company, the MD of the

company may get imprisonment.

Leave

Casual leaves - 20

Medical leave - 10 full day leave/20 half day leave

Earned leave/annual leave : The employees have the right to take 1 earned leave

for every 20 working days(20:1)(based on factories act). But the management has

the right to put forward attractive plans in front of the employees to motivate

them. Earned leave can be encashed. The maximum number of earned leaves that

can be encashed are 300 days.

In KAL the earned leave ratio is as:

Managerial category - 11:1

Workmen category -13:1

Holidays

KAL follows a systematic method for deciding holidays in an year. There can be up to

13 holidays in an year. Out of these 4 days are national holidays-jan26, may1, aug15,

oct2.The remaining festival holidays are decided by the management and workers

committee.

Total number of leaves in an year

Annual - 30

Casual - 20

Medical - 10

Holidays - 13


26


Week Sundays - 52

________________________

TOTAL LEAVES- 125 /year.

Promotion opportunities and appraisal

Promotional policy

50% recruitment is through direct method and the rest id through promotion.

The promotional levels are:

Technical

Engineer, Senior engineer, Ass.manager,manager, Deputy general manager, general

manager.

Nontechnical

(1) Accountant, junior personnel officer, junior law officer, superintendant, sales

executive.

(2) Ass.accountant officer, Assistant administrative officer, Ass.personnel

officer, Ass.welfare officer.

(3) Account officer, Personnel officer, administrative officer etc

In KAL promotion is based on

Seniority

Qualification

Performance

If a person won’t get promotion till 10 years due to lack of qualification, poor

performance etc he will be given a grade. It is called upgradation.

Difference between up gradation and promotion:

The upgraded person will get salary hike only. He won’t be given authority according

to the salary increment. But in the case of promotion, the employee have both salary

hike and authority.


27


Performance appraisal policy

It should be in prescribed form.

The performance appraisal shall be conducted annually in the case of

workmen. In the case of supervisors and above, the appraisal shall be

conducted half yearly during the period from January to june and july to

December.

The entries in the performance appraisal form shall be clear and precise and

shall be based on the officer’s personal observation of the work and conduct of

workmen.

The entries shall be made by the officer in his own hand or type written by

him and shall be kept confidential ad the report shall be under the safe custody

of the personnel department.

If there are any adverse of such nature that the workmen needs an advice or

admonition only, the concerned Head of Department shall render such advice

of admonition. In more serious cases, the head of department shall give

opportunity to the concerned to submit explanation. The intimation to the

workman together with his reply, if any, shall be kept in the personal file.

The confidential record shall be prepared by the officer under whom an

employee is working and shall be submitted to the head of the department who

shall countersign it, adding his own remarks, if any.

Performance appraisal process

It includes the appraisal from the immediate head of each employee.

Performance appraisal is done on the basis of certain factors such as job knowledge,

job responsibility, quality of work, cost consciousness, organizing ability, punctuality,

problem solving ability etc. Performance appraisal goes through the steps as follows:

(First appraisal by employee, then appraisal by the rater (immediate next head) and

reviewed by the head of the department. Calculation of appraisal score of employee

done based on five point rating system. The final rating is done by the rater.

Counseling is also given for low level performers).

Steps

Issue performance appraisal form to employees.


28


Self appraisal by the employee.

Appraisal by the rater.

Review by the rater.

Review by Department head. Calculation and appraisal score of each

employee in personal interviews.

Counsel employees for improving performance.

The five point rating method is used for performance appraisal. Grading are given

below in two tables. Five point rating method is used:

Grade A B C D E

Performance Excellent Very

good

good average Poor

Point 90-100 70-89 50-69 30-49 10-29

Disciplinary procedure

Discipline is a watch word maintained in KAL. Disciplinary actions are

strictly followed. There has not any instances of dismissed at KAL till date. As usual,

the worker is given a show cause notice and a time limit is given to produce his

explanation. If the explanation is satisfactory, no further action will be taken. But if it

is not satisfactory, he will be given a charge sheet and thereafter enquiry. A workman

can be suspended for enquiry. He will be paid a subsistence allowance according to

the kerala payment subsistence act 1972. If the explanation is convincing, then the

suspension is withdrawn and wages for the period of suspension will be paid in full. If

no explanation is received, the management may proceed with action.

Enquiry may be held by enquiry officers appointed by the higher authorities.

Enquiry officers will make recordings and forward it to the concerned authority. Then

charge sheet and the recordings of the enquiry will be given to the concerned

authority and the decision is communicated to the workman. If the charges are proved

by the enquiry action will be taken, if not the worker will be called on duty and his

wages for the suspended period will be paid in full.


29


Grievance procedure

The company has an open door policy as far as grievance handling is

concerned. Workmen are true to take their grievance to their superior authority and

seek a redressal. The usual procedure for handling of grievances is given below:

(1) Grievance report to immediate supervisor.

(2) If workman is not satisfied/ not receive reply within 7 days he can go to next

immediate supervisor.

(3) If that decision is not satisfactory/ doesn’t receive reply with in 7 days, he can

send the grievance to the head of department in written with signature.

(4) If the decision of head department is unsatisfactory/ doesn’t receive reply with

in 7 days he can present a copy of grievance not to the Head of HRD department who

will make necessary entries to grievance register. He will then conduct investigation

of all relevant facts and endeavor to settle the grievance satisfactorily shall be final.

The head of HRD department will implement the final decision if any and will inform

the response in writing.

Industrial Relations

According to the referendum, the union having 15% membership will only be

recognized. Now in KAL there are 3 unions.

Name of union Reg. No. Affiliation

Kerala Automobiles

Limited Employees Union

126/82 INTUC

Kerala Automobiles

Employees Organization

102/84 STU(Swathanthra

Thozhilali Union)

Kerala Automobiles

Employees Association

325/84 CITU

From the discussion with HR manager

Now there are 257 permanent employees in KAL

Company was in loss before some years and is slowly coming to profit.

Employees are given training in different areas for the expansion program.


30


As a part of product diversification, coir spinning machine is made and handed

over as per demand. By providing training, the management is trying to impart a

change in the work culture. The work culture that KAL follows is a traditional

one. It needs to accept the change according to market and time as the other public

sector companies are also changing.

In Department Performance Appraisal (DPC), HRD department has the plan to

implement a written test for the officer category. But due to the opposition from

the side of employees, it became unsuccessful.

Absenteeism : For lateness, the proportional amount of salary will be reduced. A

regular attendance is kept. There is a time keeper to make sure that employees are

on time. He is responsible and checks the duties on time.

Situation analysis is a must for a HR manager. One has to stay calm and listen to

the problem/issue first. HR has to stand independent in taking the decisions, with

out any biases

Exit interview: Usually there is no exit interviews done in KAL at the time of

retirement.


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3.2 ADMINISTRATION DEPARTMENT

DEPARTMENT STRUCTURE

The main functions of administration department are as follows:

Committees

The committees in KAL are formed by the unions elected each year. Each

union nominate one person to each committee. Equal number of persons from the side

of labour unions will be nominated from the management side. The committees in

KAL are canteen committee, safety committee, magazine committee, estate

committee, scrap committee.

Committees are under administration department. Election is also carried out

by administration department. The union which wins election undertakes club and

society. Usually the election is carried out in 3 years.

Labour welfare committee: It provides Rs 62,000 to family on death of personnel. It is

by aggregating the salary of 1% of employee plus 1% by the management. It gives

awards to the children who tops in exams like SSLC, B.Tech, +2 etc. The price

money varies as Rs 1000, Rs 750, Rs 500.


32

MANAGING DIRECTOR

ADMINISTRATION MANAGER

JUNIOR EXECUTIVE

WORKER


Punching card and ID card are issued by the administration department. In turn, an

employee has two cards.

Security: Managing the security people is done by the administration department.

Fresh quotation is invited every year for the security people. ‘Ex- service league’,

an association of ex-service men carries out security job nowadays.

Total number of security = 18

Supervisor salary - Rs 200(improved from Rs 160)

Security Guard - Rs 160 (improved from Rs125)

Uniform for the workmen are issued by the administration department- Pista green

shirt and black trousers for men and Pista green saree and black blouse for

women. Stitching allowance of Rs 250 is given for men and Rs. 100 for women.

Canteen: every year new quotation invited in dailies like malayala manorama,

mathrubbhumui, kerala kaumudi etc to undertake canteen. Canteen committee

votes and selects the best quotation. Management given Rs 300 subsidy for each

employee every month. Coupon is given to employees for food. Water, building,

utensils etc are free for canteen undertakers. There is a ration permit of 3500 Kg

rise and 2000kg sugar for KAL canteen.

Stationery: administration department buys and stores he stationery items like

calculator, files, glue, paper, pen etc. In every 2-3 months it is bough wholesale

from Triveni shop, for an amount up to Rs 40,000. It is supplied to each respective

department as per the need and it makes sure that the items are not manipulated.

Letter dispatch: Every outgoing letter is sent via administrative department.

There is a machine called ‘Franking Machine’ to seal the letters, which is issued

from the postal department. The parcel weight is measured and the respective

stamp rates are printed.

Advertisement: Some organizations demands for advertisement as promotion for

programs, in magazines, diaries etc. The photos that are advertised is brought to

the organization, and then only the money is paid. To print the KAL diary,

administration department approaches different firms for advertisement to reduce

cost. It has a long time regular advertisement providers.

Furniture: It is bought and supplied by the administrative department. The repair

work is also done by this department.


33


Retirement: Administration department arranges a send off function in the

portico on the day of retirement of an employee. The company car is arranged to

take him home. He will be given a gift and a party will be arranged.

Supplying the government calendar from collecting it from the government press

is the duty of administrative department.

Funeral arrangement: In the case of demise of an employee, Rs 5000 will be

given to the family to carry out funeral function. Rs 3000 will be given to the

close relative of the died person.

Garden: the garden is maintained by the administration department.

Head load workers: The wage of head load workers is paid by the administration

department.

License Renewal: It’s the job of the administration department to renew the

license of company every year. If the license is not renewed, the company cannot

work. The industrial license application is given in the form-2. It is according to

the rules – 4 , 12. The application for renewal is sent along

with the duly filled in ‘form-2’ and the chellan of Rs. 75,000 and the names and

details of Board of Directors. Original factories license will also be sent along

with this and it is renewed and a new license is issued back to the company. The

license is renewed from :

“The inspector of Factories and boilers

Grade-2 , near vanchiyur police station, Thiruvananthapuram”


34


6.3 PURCHASE & SUB-CONTRACT DEPARTMENT


Supplier

development

PURCHASE DEPARTMENT

Objectives:-

Satisfy the supplier by giving regular order

Reduction in rate of rejection in materials


35

Manager (materials)

Assistant manager

Senior engineer

Junior engineer

Attender

Clerical staff


Vendor rating up graduation

The main function of the purchase department is to purchase the raw materials which

are necessary for the production process.

The products purchased are divided in to 5 divisions – A,B,C,D,E.

Product type A: includes – tyre, engine, tube, sheet etc

Product type B : includes – upper cone, horn, speedometer, cable for gear control,

heel cylinder assy, brake lever assy, mango lever, spring etc.

Product type C : includes – shaft with support, clip cables, shim adjusters, petrol

tank neck, rear break adjuster, spacer for head lamp, cable for clutch, support

bracket, rivet, wiper fitting, screw etc.

Product type D : includes – div. beeding, overflow pipe, speedometer cable,

ignition switch, decompression cable, main electrical loom, DC horn, battery

cable assy, BULB – B 53, tail lamp assy, reflex reflector, indicator (green),

silencer mountings, stop bush spring.

Product type E : includes – sheet (MICA/PVC), tape (cotton), paint(INC golden,

yellow) , primer, putty, thinner, rubbing compound, polish wax, seal 101 chemi,

react chemi, additives, welding glass, button mop, emergency powder.

Purchase cycle

Calls quotation

Negotiation

Checks quality

Purchase development


36


Purchase department ensures the availability of right material at right tie at right place

at the right quantity. The department is under the control of purchase manager. All the

activities regarding purchase are under gone in this department. This department is

responsible the procurement of raw, materials. Its supply and service the raw

materials and purchase parts in the finished goods must be the information from the

marketing department, planning department prepare the sales plan and send the

production plan & material plan to the purchase department Based that requirement.

The department purchases both raw materials and semi finished goods. Prepare the

purchase order and then it scheduled to making purpose. Then give the order the

company purchase mainly from Haryana, Uttar Pradesh and almost 25% is form

Mumbai. The purchase of materials from vendors and they rate vendors and evaluate

them on the basis of parameters like quality, price, time. The department is following

ABC analysis for purchasing of products. They do have a PDCA cycle of doing

things.


37


ABCDE analysis is used to follow for the purchase. The order that is placed for ‘A’

category is before the week, for ‘B’ before one month and for ‘C’ items. The order is

placed before six months. The responsibility for ‘A’ quality is with materials

manager, ‘B’ quality with Asst. Manager and ‘C’ is with Asst. Engineer (purchase).

There is a purchase committee formed for the purpose of bulk purchase of products.

This department also uses vendor rating and vendor evaluation techniques. If the

rating of the vendor ‘C’ grade they will encourage the vendor to promote to ‘B’ grade.

Of they are not living up to their expectation. The company will delete the vendor

names from the vendor list.

The company purchasing more than 2200 components for a single product. The

categories into A,B, C, D, E and subcontract.

Most of the suppliers are from outside of the state. Mode of transmission is by truck

or railway or airways, based on the time and need. Some of the main transportation

agencies in the company are Kerala Transport Corporation. Sourashtra Roadways,

ABT purchase etc. If the mode of transportation is through truck then thee

consigner(vendor) give the consigner copy (CC) of the lorry receipt(LR) to the

consignee forwards the CC of Ir to the agency and collects the goods. If the

transportation is through railway then the documents in Rail receipt and for airways it

is always bill.

The Procedure for a purchase

Enquiry for question

Receive the quotation

Negotiation of the quotation

Revise the quotation

Compare the statement

Proposal for the purchase

Place purchase order

Follow up the material

Collect the material

Quality inspection

Raising GNR or GRJ (Good receipt note/Goods rejection note


38


Payment to vendors

Payment for vendors is in 3 ways

Direct Credit – forwarding original GRN & invoice to the accounts

department for the payment, usually within 30days.

Direct advance - against Performa invoice

Through bank – the vendor will sent the original invoice and CC to Lr

to purchaser’s short bank. The bank sent BLSC (Bank Letter for Short

Credit) After the payment, the bank will forward the Lr documents &

invoice to the purchaser.

There is a purchase committee. It includes DGM, manager- production, manager-

purchase and one member from accounts section.

Local purchase: Small and the products of urgent shortage are brought locally by

paying money instantly. This is to avoid production held-up.

The purchase up to 15000 is controlled by the manager

Between 15000-100000, by the purchase committee

Above 100000 controlled by MD with recommendation of purchase

committee through GM

List of the purchase schedule:-

Register for the copy of invoice

LR forwarding register

Comparative study

Procurement data analysis

Purchase order

Enquiry notice

Annual purchase plan

List of approval suppliers

Bank document

GRN receipt

Supplier rating document

Supplier satisfaction is one of the main aims of the department. The department keeps

good relation with the suppliers and pays money on time. It also makes sure that the


39


products purchased are of good quality and keep motivating the suppliers to provide

good quality stuff.

SUPPLIER DEVELOPEMENY SECTION

The section finds out the goods and fair source of supply.

Procedure for supplier development:-

This section looks for the potential source of suppliers by referring the journals,

attending exhibitions, seminar and trade fair. After making contract with suppliers, the

section will prepare a supplier list form. Applications are received from the supplier

and the committee evaluates and selects the good one. After the section a written

letter will be sent to the approval supplier for the issue of required raw materials. The

department is responsible to keep the supplier list and approval records. Performance

of every supplier in the approval list will be reversal once in every six months.

Functions:-

They act for the development of existing suppliers and identify their problem,

then come out with good solution.

Develop fresh parties for their requisition by R&D department

Identify quality supplier from

Provide alternatives solution for quality products.


40


SUB- CONTRACT DEPARTMENT


In KAL many of the terms such as differential cage, axel, shaft etc are sub

contracted from outside.

This department has the same function as the purchase department. In this

department the details regarding outsourcing products or materials are stored and

updated. This department is functioning under the purchase manager. Sub

Contracting materials are given inside and outside Kerala for work. Materials

manager is in contract of sub contract department.

Objectives:-

Supplier Satisfaction

To reduce rejection in sub contract items of differential cage from 10% to

20%

To reduce rejection of axel, shaft from 20% to 2%. The sub contract

department follows PDCA cycle in this activity.

Main Sub Contract areas are:

Cluster gear, main gear with bush, hand chassis etc.


41

MATERIALS MANAGER

SENIOR ENGINEER

ENGINEER

CLERICAL STAFF

JUNIOR ENGINEER


Activities:

Receive production plan from planning department

Make purchase enquiry

Invite quotations

Prepare comparative statements

Send negotiation letter

Receive negotiation letter from vendors

Prepare work order proposals.

Proposal approval

Issue work order

Place loan note for approval

Deliver materials

Follow up note for approval

Receiving inspection of sub contract items

Receive GRN

Check GRN to account department

Forwarding of GRN to account department

Sending payment with copy of GRN to work contracts

Request to store for returning of rejected materials


42


3.4 MARKETING DEPARTMENT


North India is the main market of KAL. In 3 wheeler industry KAL has only 1 %

market share.KAL mainly produce 3 wheeler chassis and send it to the godown I

north India. Then it is supplied to the dealers as per their demand. The dealers

make the body for the vehicle as the customer demands and sells the product. The

dealers will get a significant amount in body building.It can be up to 1.4 lakh. This

is because different people have different interest and they use this vehicle for

different purposes. In kerala KAL cannot compete because there are a lot of

manufacturers who gives super-finished goods to the customers. KAL is

sharpening the edge to get in to the market. An another reason that the north


43

GENERAL MANAGER

ASSISTANT MANAGER

ACCOUNT OFFICER

SENIOR ENGINEER

ASSISTANT SALES EXECUTIVE

CLERICAL STAFF


Indian customers buy the product is that its performance. It have a good mileage

and high power that it can run in any conditions of road.KAL is producing fully

built vehicles as per demand.

Marketing means making available products suitable for sales. The efficient

making department is the corner stone for success for every organization. In KAL

marketing department is under the control of GM (marketing). The activities of

this department are directly reported to the MD. This department identifies the

customers, interact with them and find out their needs and thus figure out the

market potential of various products.

Marketing management is a pre-requisite for the successful Operation of any

business enterprise. Marketing management shall be responsible for the after

service activities of the company. The marketing department shall maintain a

register showing details of the warranty claims against each vehicle. Marketing

determines the needs of the customer and sets out the pattern of production of

goods and service necessary to satisfy their needs.

Quality objective:-

Extend awareness about MX400 vehicle among all dealers.

Locate more dealer outlets in Karnataka and Tamil nude.

Appoint dealers in the unrepresented areas in the northern states.

Making available vehicle according to demand of the customers.

Function:-

The marketing department ensures that the company’s products are marketing

to various outlets, taking in to consideration the demand for various types of

vehicles at the various outlets.

Appointment of dealers

Dispatch of vehicles

Preparation of sales and dispatch plan

Collecting feedback information of the product.

Termination of dealers

Advertisement and sales promotion

Transportation management


44


Contract review

Procurement and sales of spare parts

Warranty settlement

Free service coupon settlement

Customer complaints

Pre-delivery inspection and provide free service at dealer point

Acceptance of order for special purpose products

Procedure for contract amendment

To co-ordinate the function of material production and sales department.

4 P’S OF MARKETING:-

PRODUCT:-

KAL produces mainly 3 wheeler auto rickshaws of diesel as well as petrol versions.

At present it is mainly concentrating on the diesel version under the brand name

“KAL”.

Products

1) Kerala GL 400 V2 electric start chassis- Rs 76,000

2) Kerala GL 400 V2 rope start chassis – Rs 74,000

3) Kerala GL 400 V2 MX 400 electric start chassis- Rs 83,000

4) Kerala GL 400 V2 rope start - Rs 77,000

New products

1) Self start (340cc) petrol engine [CNG]

2) Self start (340cc) gas engine

Other products: KAL manufactures rocket components for ISRO from 1990. It worths

up to Rs 50,00000. It has started manufacturing coir spinning machine and it has

become successful. more and more machines are supposed to be manufactured in

KAL.

PRICE:-

KAL follows cost plus pricing strategy in which the margin is included for its

products. It also considers the price of competitor’s vehicles while fixing price.


45


Market price of its products is kept comparatively lower than the competitor’s model.

Before making the crucial pricing policy KAL conducts forecasting for its products

mainly by

Feedback from dealers

Conducts market survey

Compare the sales of competitors similar products.

Company also conducts market research with the help of some external

agencies

The various products of KAL having different price in various locations and the

detailed market price list of the various products are given below

PLACE:-

The marketing of vehicles is done through dealers and agents. The main market of the

products of KAL is north India. The main markets include Haryana, Uttaranjal,

Punjab, Rajasthan, Uttar Pradesh, and Gujarat. Here are also small markets in Kerala

and tamilnadu.

Exports:- a major portion of annual production is exported. KAL earning through

foreign exports in last financial year were. Its major destinations include Bangladesh,

Srilanka, Nepal, Sudan, Nigeria, Gautimala, South Africa, and Botswana etc. recently

KAL has signed a memorandum for the export of 1500 diesel 3 wheeler vehicles with

meders Liberty Techo Company and it was one of the biggest orders received by the

company. The last time export worths $ 1600.

Dealers are selected on the basis of show room facilities, service and man power etc.

Company gets in to contract with dealers for a minimum of 2 years. Company has

liaison officers at Delhi to co-ordinate the north Indian operations. The main dealers

in Kerala are marikar and Kerala state agro industries.

PROMOTION:-

KAL Mainly uses customer promotion and trade promotion techniques to enhance

sales. Main sales promotion techniques are:

Company participates in auto shows

Advertisement in local channels


46


Gifts in all seasons

Incentives to dealers making maximum sales

6 free services are given at crossing 500,1000,2000,3500,4500 and 5250 kms

Warranty of spare parts. The warranty is for a period of 6 month from the date

of purchase or crossing 5000 km which ever is earlier

Sales incentives to the dealers as sales promotion

Sales In Last 9 years

No Year Sales

1 2001-2002 6858

2 2002-2003 6185

3 2003-2004 6756

4 2004-2005 5091

5 2005-2006 5900

6 2006-2007 4900

7 2007-2008 2917

8 2008-2009 1605

9 2009-till 2605

Total number of 3 wheelers sold out til now is : 1,20,000 vehicles.

Competitors:-

Bajaj auto ltd

Piaggio auto

Atul auto industry

Sitarn auto industry

Dealers:-

STATE NUMBERS

Haryana 12

Punjab 10

Rajasthan 15

Uttar Pradesh 8


47


Dealers are given special incentives on achieving the more target and on selling more

product. Dealers are given special offers to keep a good relationship with them. KAL

provides all the support both technically and in management level. But nowadays

there are no high sales.

Special orders: sometimes KAL receives special order from Travancore dewaswom

board. KAL manufacture special purpose tippers for them.

Other activities:.

3.5 FINANCE DEPARTMENT

DEPARTMENTAL STRUCTURE

Seven persons are enough to start a public limited company.a company is started by

contributing money. The capital of KAL is contributed by Government of kerala

when it started. The initial investment was 4 crores when the company started. It was

in loss till 1992.then a revival package was allowed by BIFR.It was approached to

banks to get money and to government for grand. In 1994-95, it started making profit.

It continued up to 2004-05. Its accumulated loss was wiped out and it snet worth


48

ACCOUNT OFFICER

ASSISTANT ACCOUNT

ACCOUNTANT

ASSISTANT ACCOUNTANT

CLERICAL STAFF

ASSISTANT MANAGER (FINANCE)

CASHIER

INTERNAL AUDITOR

COMPUTEROPERATOR

GENERAL MANAGER


became positive. There was a surplus in the balance sheet. From 2005-06, it again

came to loss and continues till now.This is because the production and sales is not

enough to meet the target.

Current status:

Companies accumulated loss – 15 crore.

Companies net worth is negative.(net worth = asset – liability)

Production less that 300 vehicles a month will make liability. So, R&D is to be

developed to get it manage. They have to give quality product. Nowadays company

suffers the lack of sufficient amount of fund for the day to day operations.The

government should provide more money to meet working capital. There are crores of

rupees as current liability.

Money is the life blood of any organization as it is required to purchase raw materials

and machines, to pay wages and salary etc. the financial statement of the company is

prepared under the convention accrual basis as a going concern. Complying with the

accounting standards prescribed under the companies act 1986. Documents for

original entry are prepared directly in the computer and a copy is sent to the

appropriate authority for further verification and approval. If any entry is to be

certified, it can only be done through an adjustment document. This ensures security

of documentation against any accidental errors or manifestation. The ultimate

responsibility of carrying out the finance functions lies with the top management.

Thus a department to organize the financial function should be under the direct

control of the Board Of Directors.

MAIN FUNCTIONS:

Cashier collects cash receipt . If any payment is taken place, a bank payment

voucher is prepared. Every voucher is prepared by the debit and credit system through

the computer. When transaction takes place, a sales invoice is prepared by the

marketing department for the dealer. When invoice is prepared, the computer database

is used to create debit and credit and which is sent to dealers. From sales list, a trial

balance is prepared. When payment is taken place, payment voucher is prepared.

Every transaction is prepared by clerk. It is send to the finance manager. Then the

payment is given by the cahier.


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Cash receipt/payment

Bank receipt

Finalization.

Capital structure

Purchase.

Sales

Managing computer.

Preparation of VSR

Withdraw/receive/payment of cash.

Position and filling of VRS.

Settlement of tax, temporary salary, interest advance.

Payment of retainer fee.

Physical verification of cash.

Verification/approval of all cash /bank receipt and payment vouchers.

Bank receipts/payments

Preparation of RT vouchers.

Amount transfer vouchers.

Writing of cheque.

Generation bank books.

Preparation of bank reconciliation statement.

Verification of checklist of sales bills, stipend etc.

Remittance of all recoveries made from salary.

Settlement of canteen account etc.

Finalizations

Analysis of ledger.

Ratification of errors.

Adjusting and clearing entries.

Preparation of trial balance, P&L accountant & balance sheet.

Assisting internal audit.

Assisting statutory audit.

Preparation of annual reports.

Capital structure


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Capital structure is a major aspect of financial planning. The capital or funds

come in the form of long term and short term departments, preferences and equiy

shares. The company has no share holders other than loan from Kerala government.

The company’s other financial support is only from the financial institution SBI.

Debt-equity ratio of the company was 6.7:1 I n2001-02, .44:1 in 2002-03, .38:1 in

2003-04.

Purchase

Opening tenders

Posting and filling GRN

Preparation of payment vouchers

Analysis of supplier vouchers

Analysis of supplier account.

Sales

Arrange follow-up invoice.

Preparation of sales tax return.

Payment of incentives.

Warranty claim statement.

Attending sales tax hearing.

Verification of account.

Managing computer

Salary bill processing.

Arrears calculations.

Keeping the accounts database.

Calculating the employee benefits, credits, debts etc.

Preparing the documents of transactions.

Maintenance of computer system is done by finance department.


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3.6 PLANNING DEPARTMENT


Planning department is under the control of GM(production). This is the base of all

production, marketing, storing and all other managerial functions of the management.

All the major functions are performed within the framework of plans done by the

planning department.

This department mainly concentrating on production, marketing, storing and

all other managerial functions of the management. It is mainly concentrating on scales

planning. But also maintenance the material planning and production planning. They

are taking the decision on market targeting, market mix, priority of raw materials (A,

B, C, D, E ) etc. Based on the information from the marketing department, they

produce monthly target. Then the target will send to the concerned department. If any

faults happen, then make correction after discussing with the GM.

Functions

In KAL planning takes in 3 phases.

Planning phase

Executing phase

Control phase.

This department gives the information about the allocation and utilization of machines

and materials required for production. Incoming raw materials are delivered to the

quality assurance department after that collect in store and then distribution. It also

does the controlling function. The day to day works are sent to this department to

check whether the production is in accordance with the planned level or not.


52

ASSISTANT MANAGER

JUNIOR ENGINEER

OFFICER


3.7 RESEARCH & DEVELOPMENT DEPARTMENT

This department designs the model of products and provides information about

various items, which the company can produce. This department is under the control

of the marketing manager.

In KAL, R&D department provides information about the various products which

can be provided by the company.

Design section:

Based on the market study done by the marketing department and competitors, the

marketing section decides the design for the product.

Italian design is the basic design adopted for the Indian 3 wheeler industry. In

KAL, they designed the petrol model in 1984. In 1985 they designed the diesel

engines vehicles. KAL designed the tipper, bottle carrier, jumbo, 4 stroke petrol

engine vehicle etc.

KAL product engineering section has the computerized design system and

testing equipment to ensure the international standards. Experienced engineers have

transformed the basic Italian model.

The latest trends in production are to provide fuel efficient and eco-friendly vehicles.

Company is introducing engines of bharat stage-3.

Major achievements

Introduced diesel engine 3 wheeler in the market for the first time.

Introduced 6 seater diesel engine 3 wheelers.


53

MANAGER

Sr. Engineer

Jr. Engineer


Development of aerodynamic design.

Introduced TRIMO which is a 3 wheeler micro car with round steering. It had

good market potential. But the production became unsuccessful due to

financial, legal and red tape constraints.

Design, development and introduction of KERALA 360 pick-up van with

hydraulic system.

Introduction of KERALA MX400 chassis.

R&D in wheeler functional area

Improving riding control

Aerodynamic body design.

Re-design seating capacity.

Development of AF series of gearbox, resulting in the increase of maximum

speed from 4 kmph to 50 kmph.

Fixation of quality grade for present gear components.

Analysis of low clutch life period and introducing necessary modifications.

Research and analysis to reduce rolling friction of existing models.

Research for the modification of present engine to upgrade to next bharat stage

level.

Future plans:

Improve the quality and reliability of products.

Design and development of high-tech 4S petrol engine.

Improve the quality of the components used for production.

Improve the quality of sophisticated precision components for space

application of VSSC.

Plan to develop hybrid electric vehicle as a combined project with KELTRON.


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3.8 PRODUCTION DEPARTMENT

PLANT PROCESS

PROCESS:

In the first step, the materials are purchased from the supplier and sent to the

manufacturing process. The manufacturing is done according to the specifications

given by the product design section. The marketing department will be involved in the

work of collecting the design specifications from the market. Once these

specifications are collected from the market, the design department will design the

product and send it to the approval of the purchase department. Once the purchase


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Supplies raw materials

( through suppliers

Quality inspection Quality inspection

Quality inspection

Final assembly

Stores department

Sub assembly

Machine shopFabrication

Stores raw materials

Paint department


department approves the design, then the planning department prepare the production

plan. Using this plan, the materials are taken from the stores department and products

are made by the production department. Each and every step of production process

will undergo a quality check. The finished product is also undergone a quality check

and is sent to the stores to hand over to the dealers.

The entire work flow is divided into 3 major processes

1) MOP(management oriented process)

2) COP(customer oriented process)

3) SOP(support oriented process)

(1)MOP deals with the market representative(MR) and IQA. In order to achieve the

targeted profit, (2)required steps are taken by them. It is concerned with providing

good of good quality at a competitive price. For this purpose the quality assurance

department is established.

(3)COP deals with making the customer satisfied by providing all the services they

require. Various departments are covered under COP. They are marketing, designing,

planning etc.

SOP is concerned with providing necessary services that supports the MOP and COP.

SOP do also play an important role in the organization. Unless SOP is not working at

100% efficiency, it is not possible to provides quality goods on time. SOP covers

various departments like – stores, HRD, QA etc.

About the department:

Production department is the main department in which certain ideas and

technologies are adopted for purchasing the quality products. The employees crew

includes industries at engineers, machine operators, plant maintenance etc. The

production department is mainly classified into 5 sub Units. Each sub units have

separate manager

KAL has the capacity of producing 600 units per month. The production department

is mainly concerned with manufacturing of various parts of the vehicle monthly

production is fixed on the basis of target demanded in the market available of raw

materials and the financial capacity of the company.

In earlier days, production of KAL in some month was 750-800, now. It is around

300. This is because of some financial crisis and some sales promotion techniques.


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There is no separate using for promoting in advertisement and the authorities do not

take any such promotional activities. Non- advertisement is one of the failures of the

competition among others such as piaggio, Ape, Bajaj Auto etc.

The sub units under the production department are

Machine shop

Heat treatment

Tool Room

Fabrication

Assembly

Paint

KAL receiving the projects from the organization in sub contract base such as VSSC,

KELTRON etc.

Objectives:-

o Minimize the rejection rate

o Reduce the network of material

o Improving the utilization of material

o Rejection of material if nay to the store.

o Undergoing machining operations of accepts material

o Ensure the quality of the products.

Machine Shop:-



57

GENERAL MANAGER

ASSISTANTGENERAL

SENIOR ENGINEER

ENGINEER

WORKMAN


Machine shop producers the sub pairs which are required for the production of the

finished goods. Tool room is a part of this. The maintenance of the tool room is done

at tool room for production. As per the planned schedule. The store issue the material

required for the production in a weekly manner, Gear selector, steering road etc are

produced in the plant. The shop is under the control of the Sr. Engineer .

machines in the machine shop

o Capston lathe CD1

o Capston lathe CD 2

o High speed lathe H22

o Turrent lathe

o Enterprise centre lathe

o Copying lathe hidustan.

o Facing & catering machine.

o CVC turning lathe (weiler)

o CVC turning lathe

o 2D capston lathe New 2D2

o Redial drilling RD 50.

o Radial drilling RD6

o Radial drilling – Balitiboi RD 25

o Drilling machine – baltiboi RD-32

o Drilling machine new Baltiboi RD322

o Column drilling machine New CD 402

o Accumax pillar drill

o Bench drill.

o Automatic tapping machine.

o HMT Horizontal milling machine (FN1 EH1)

o HMT Horizontal milling machine (FN2 EH2)

o Horizontal milling.(BFW)


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o Universal milling

o HMT Vertical milling (FN2V1)

o HMT Vertical milling new (FN2V2)

o Milling machine(MTR)

o HMT Horizontal cylindrical grinder(K1300)

o HMT cylindrical grinder(K1300-300p)

o Cylindrical grinder(K1300)

o AWH grinder(GT)

o New Spin Surface GH (GVS30)

o Surface grinder pranga

o Internal grinder(GIF -80)

o Gear Shaper Old

o Gear shaper HMT New

o Gear Hobbing Cutter

o HMT Broaching Machine

o HMT Vertical Milling VTC

o Fine Boaring Machine 734

o Fine Boaring Machine 375

o Honing Machine

o VMB-8

o Rolling Machine

Heat Treatment:-

Here the components are heat treatment this station includes.

Muffler furnace

Gas car building furnace

Induction hardening etc.

These are under high temperature. Pallet trucks are used to transport the material since

the temperature is very high. The tempered and hardened units are tested by the

quality control unit



59



60

JUNIOR ENGINEER

WORKMAN


Tool Room:-

The maintenance of tool is done in the tool room department. The consumable tools

requires frequent maintenance. KAL also receive products from organization such as

VSSC, KELTRON etc. These projects include of certain components and are carried

out here


Fabrication:-

It comes uncer the asst. manager engineer is the head. The main functions are welding

cutting etc. Some machines are used;-

Bending machine

Pressing machine

Welding machine

Shearing machine

Lythe enterprises

Nimbling machine

160 ton is the capacity pressure


61

SENIOR ENGINEER

WORKMAN

ENGINEER

JUNIOR ENGINEER

WORKMAN


The initial worries like bending , pressing, welding etc are doing here after that they

will forward to the other sections like machine shop, assembly etc. The fabricated

body parts are then thoroughly checked by the QA department.

Welding Process

There are 4 type of welding.

Mig welding (using Metal + CO2)

Arc welding( using rads)

Spot welding (carbide point)

Gas welding- this method is used to weld the diesel tank or petrol tank.

Assembly:-

Production manager is the head of thisdepartment. Gear assembly, engine assembly

vehicle assembly, handle assembly etc are the main fuctions. It holds sub assembly,

Doom Aasembly etc.

Some types of assembles are-

Rear break plate assembly

Tire assembly

Rear axle assembly

Differential assembly

Hub assembly

Chassis assembly

Handle bar assembly

Propeller shaft assembly

Fork assembly

Front hub assembly


62

JUNIOR ENGINEER

WORKMAN

SENIOR ENGINEER


Gear box assembly

Electrical assembly

Diesel assembly

Line Assembly :-

Line assembly is one of the main assembly section. There are main two stages in line

assembly.

Stage A: Join chassis & differential (rear axle assembly). It includes the assembling of

foor break, hand break, propeller shaft. The front fork is also fixed.

Stage B: differential oil is filled. Back and front tires are fitted in this section. The

handle bar is also fixed.

From this department, it goes to the doom section to assemble doomshield, glass,

diesel tank and from there, it goes to Engine assembly.

Engine Assembly:-

Greeves GL 400 engine is used to manufacture 3 wheeler. It is a single cylinder diesel

engine. It’s a 4 stroke engine( low pollution, more mileage)

Specifications of engine – 400cc, 3600rpm at maximum and 1000 rpm at minimum,

HP-7.5, air cooling system.multi plate clutch,

Engine price – around Rs. 24,000

Engine oils:- 20-40 grade (1.25)

SAE 90 grade(1.45 litres)

140 grade filer oil , this is for filler plug at the rear part

When the grade of the oil increases, its viscosity decreases.

Filering devices: there are 3 filtering processes. They are -Air filter, diesel filter, Oil

filter.

Gear Box section

Gear box section manufactures the gear. Torque and speed of the engine is

determined by the gearbox. Engine’s uncontrolled power is controlled by gearbox.

The teeth of gear box needs very sharp attention in its manufacturing process. Small

teeth have high regulation and large teeth have low regulation.


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Paint shop-

Junior engineer is the head of this department. The painting works of the finished

goods are done here, before the painting the products are sending to the pre-

treatment section. It is called as tank process.

The various steps:klean chemi -> water -> blast chemi(de-rusting) ->water ->

seal chemi -> De-act chemi.

It is done to avoid the resting. A crane is used for cleaning. A pre-treatment is

done before painting. Small components are spray painted using conveyer belt.

After that the components are sending to the locator for drying.

Two Types

Spray Painting

Dip Painting


64

WORKMAN

JUNIOR ENGINEER


3.9 QUALITY ASSURANCE DEPARTMENT

The main aspect of these departments to check and maintain the quality of finished as

well as incoming materials. The finished goods go through three stages of inspection.

They are:-

Vehicles inspection

Test running

Final inspection

Objectives:-

Cost reduction

Quality- checking

Providing all suggestions

Wastage control

Higher productivity

Reduce defects of implant items by10%

Create a cultural among the employees of the company towards” total quality”

concepts and higher productivity through planned training for all employees

Direct and prevent non conformance defects as early as possible and climate

them through appropriate change to the quality management system.

To reduce the percentage of vehicle with break pedal problem. 30% to 5%

To reduce the defects of following components in the production department

to less them 10%

Differential Cage

Tramission Staff

Differential Bush


65

SUPERINTENDENT

ASSISTANT MANAGER

WORKMEN


Crown wheel pinior

KAL is an ISO 9001-2000 affiliated company.

Quality Policy:-

The management and employees of KAL are committed to development,

manufacture, marketing & service three wheelers, meeting customer needs through a

proves of continual improvement of its quality management system.

Functions:-

In order to maintain the quality policy and objectives the incoming materials an in

plant materials and finished goods under go several inspections in different stages.

Chemical lab is also plays a major are in Quality Assurance Department.

The critical activities:-

Incoming inspection

In process inspection

Fabrication

Finished vehicle calibration

Calibration.

Incoming inspection

Receive provisional GRN from stores department.

Conduct inspection as per QAD plan.

Rejected items with GRM given to stores

Accepted items with GRN are given to stores department and provide tags in

process inspection

Conduct spot inspection

Conduct stage inspection

After machine operation are inspected

Defective items are given to final inspector after doing work

Accepted items are given to sub-store

Defective items are given to sub store after rework.

Fabrication


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Spot inspection: done at each step of production. It is done by setting an

approved model each material and compared the original with it

Stage inspection: Done to check whether any operation is missed or is there

any errors in operation

Final inspection: there final products are inspected for quality. The

compatibility of that products is also checked

Finished vehicle calibration

Vehicle testing of the accepted vehicles

Vehicles testing after rework

Transferring accepted vehicles to the finished goods store

Calibration

In house calibration in their standard room

Invite quotations from external agencies to calibrate

Prepare comparative study and take decision

Give work to external agency

Calibrated

Place stickers on the calibrated items

The finished goods are passes through four another stages to ensure quality

Vehicles inspection

Testing running

Final inspection

Inspection before dispatch


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3.10 STORES DEPARTMENT

The success of the business largely depends up on efficient and effective stores.

Stores are the place where the raw materials. Semi finished goods and finished goods

are kept after the production. Stores department comes under GM (production). KAL

follows ABC analysis for inventory storage.

According to the nature of items stores are kept:-

Store I: hardware items, painting items, rubber parts, gear items etc.

Store II: Bearing components, location assembly battery

Store III: Casting, forging, sheet metal items.

Store IV: Raw materials, pipe wool.

It follows ABC analysis for the inventory

Inventory Control:

A. Items will store only before one week

B. Items will store only before one month

C. Items will store before 6 month

A- Required 70% of the total price, B- items required the 20% and C- items

required to 10%


68

JUNIOR TRADESMAN JUNIOR TRADESMAN

WORKMAN

ASSISTANT MANAGER


The main items is store are , hardware items, rubber parts, gear items, sheet metal

items, raw materials, pipe wood etc

Classification & codifications:-

Materials stored are classified according to their nature& usage. All the items are

given part no. as cod and having tag.

In addition to then\ main store there is a sub unit also. The store keepers record the

data of materials on the bin card and adjust the store balance. The entire information

is entered in to the computerized store ledger system called card-x, which give

systematic and accurate record. Verification is done at every end of the final year.

Actual stock is compare with the stock shown the ledger. Store keeper are the

concerned authority are responsible for any difference in stock level.

Functions:-

Receive the raw material and store it

Dispatch of rejected raw materials

Rejected material will be returned to party within 45 days after clearing

provision GRN.

Reduce the stock o non-moving item

Control the inventory as the level fixed for maximum and minimum stock

Improve the storage facility for bearing battering rear back plate assembly

tool items

Preparing documents for central excise department.

Critical Activities:-

Receiving of raw materials and storage of item

Issuing of materials

Dispatch of rejected materials

Receiving, dispatch and storage of finished goods

Disposal of scraps

Periodic stock verifications

Preparing of documents for central department


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3.11 MAINTENANCE DEPARTMENT

Department structure

Maintenance department functions under the control of manager (production). This

department undertakes the work of electrical, mechanical, and civil maintenance. The

maintenance procedure is done as team work of supervisors and technicians.

Maintenance work, which can’t be settled by the department, is done by licensed

contractors and outside exports.

Functions:-

There are mainly two types of maintenance are conducted at KAL

Preventive Maintenance

Breakdown Maintenance

Preventive maintenance:-

It is carries out to increase the lifespan of the machine. It is classified as daily,

weekly, quarterly and yearly maintenance.

Initial activities in preventive maintenance includes

Prepare schedule for preventive maintence

Check availability of machines for planned data

If the machine is not available for planned data reschedule it.

Check availability of spares

Place indent with purchase department

Stores spares in sub store

Allocate technicians

Do the preventive maintenance

Check the completeness of preventive Maintenance


70

ENGINEER

JUNIOR ENGINEER

WORKER


Prepare the monthly report

Break down maintenance:-

It is carried out at the time of breakdown of machines, when the breakdown of

machines is informed by the concerned trade man. If a number of machines are

breakdown at a same time then the machines are prioritized on the basis of loss of

breakdown per hour

Activities in breakdown maintenance

Check the nature of complaints whether the complaints is mechanical. Civil or

electrical

Check minimum stock level spares

Check spare parts procurement through purchase department

Allocate the technicians for repair work

If the maintenance department can’t rectify it obtain the service of engineers

from others

Complete maintains and repair work handover the machine


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3.12 SERVICE & SPARES DEPARTMENT

It’s function is to provide quality services to the customer. It I under the control of

marketing department.

Functions:

Collect feedback report from marketing department about the products.

Collecting the field complaints.

Pre-delivery inspection.

Framing customer satisafaction.

The company providing free service campaigns along with dealers once in 6 months

or annually.

Coupon service: It is done as an after sales service this service is based on particular

period or kilometers whichever is earlier. The coupons are received from the customer

and send the accounts department and credit note is prepared.

The service based on service period is as follows:

Distance Period(within days) Amount(Rs.)

500 30 75

1000 60 75

2000 90 100

3500 120 100

4500 150 100

5250 180 100

Warranty settlement

A warranty settlement is given to the vehicle for 6 month from the date of

purchase or till 6000km, whichever is earlier. Warranty is not valid for the rubber

parts. In case of damages, dealer will fill up warranty service claims. Maintaining

chassis number, engine number and the date of sale will send to the company. KAL

identifies the batch number and accept it if the case is genuine.


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Spare parts maintenance

The department has a spare parts store. The sale of spare is through the dealers. The

dealers will be having a store of fast moving spares.

SWOT ANALYSIS

SWOT is a system approach to understand the environment of the company. SWOT

simply strength, Weakness, Opportunity, Threat. Strength is the inherent capacity

which organization can use to gain strategic advantage over competitions. Weakness

is an inherent limitation or constraint which creates strategic disadvantage opportunity

is a favorable condition in the environment creates risk.

Like any other company KAL is also having its own strength, Weakness,

Opportunity, Threats. They are mentioned below. The sources of data’s are from

employees and from my own observation

STRENGTH:

ISO 9001-2000 certified company Product quality Major market share at north Indian states Enter into new product line Introduction of LPG models Low cost and well disinclined staff Launch of suggestion box for constructive suggestion from employees Company is keen in providing salaries and other monitory benefits Good training and induction program for workers

WEAKNESS:-

Outdated product design Lack of sales promotion activities Manual working No petrol models since 2000 Lack of proper financing for R&D when compared with competitors Less market share in south India Lack of new technology


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Low level salary for apprentice daily wages Absenteeism Lack of promotional activities based on performance Political interference Slow decision making process

OPPORTUNITIES:-

Joint venture with other companies to earn more market share Opportunity to explore new foreign market New trade promotional tools can be used Concentrating more on sophisticated precession components for space

application of VSSC or ISRO Ability to grow rapidly because of growing demands Support from government helps to tackle certain legal obstacles Introduction of new petrol models that BS-II norms will surely helps KAL to

capture major market share Emergence of new technology available in the market The company is in the process of implementing new Strategies to achieve

quantum jump in customer satisfaction Establishes market in foreign country Major market share in north India Good industrial Relation A good dealership network which ensures that products reach customers on

time

THREATS:-

Competition High growth in vehicles production Resistance to change Emergence of most modern technique to the globalization Political interference Out dated production techniques Competitors are having major market share Less market share in South India More involvement of trade unions


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FINDINGS AND SUGGESTIONS

5.1 FINDINGS

Positives:

Company posses the entire basic factory infrastructure.

Company has its own specific customers.

Skilled workers.

Availability of manufacturing machines.

Availability of contract workers all the time, when necessary.

The location of the company near highway and close to city, with railway and

other mode of transportations near with gives an advantage.

Presence of experienced employees in their respective domains.

Well managed recruitment system.

A well maintained factory working time and attendance system, affordable to

employees.

HR department gives training to the various employees as per the chances

available.

Government pay scale for employees.

Implementation of disciplinary procedure.

KAL has its own exclusive customers and dealers.

A powerful vehicle having enough mileage in any road condition.

Comparatively good and affordable canteen.

Good insurance scheme is provided for employees.


75


Negatives:

Absence of modern office management system.

Gloomy working atmosphere inside the office.

Lack of employee energy.

Lack of motivation in employees.

Lack of implementation of modern concepts of management in some areas.

Need a change in the attitudes of employees towards work and company. Need

to avoid lazy attitude in employees.

Though absenteeism could have reduced, there exists necessity of employee

engagement programs. Make sure that employees do either their job or some

assigned job when they are inside the office.

The need to renovate the drinking water facility and toilet facilities and its

maintenance after renovation.

Need to manage unskilled employees in some way so that they can be

assigned some job which will be productive for the company.

Need to re-structure the incentive plan based on production.

Problem making labors and unions are burden to the management.

Lack of safety measures of workmen is to be re-checked.

Lack of young, creative minds in some domain areas.

Low profit is an obstacle on the way to development.


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5.2 Suggestions:

The first step in striving the organization is to find maximum profit and make the

net worth positive. For that a collective effort is necessary. Marketing is to be

done efficiently. Find out new dealers, make more promotions in rural areas, give

creative, brilliant youngsters ( in the form of trainees) place in company in the

marketing department.

Product diversification is another source by which revenue can be generated.

Find out more potential products that can be manufactured in the company using

the infrastructure in the plant. It will be useful to avoid the idleness of machines in

the factory, thus by utilizing the resources maximum. After collecting the

maximum fund, the further proceedings can be done effectively. Company can be

develop step by step, only after achieving money as profit for further

development process.

Can provide employee motivation in KAL. This is to be done along with the

other development activities towards making profit. Support the employees

who have positive attitude, high energy, aspiration to grow etc.

KAL can think of providing a pleasant work atmosphere, after getting enough

revenue.

KAL can think of optimizing the use of paper documents and can shift to e-

documents, which will help to reduce the paper use and file storing burden,

helps to access data easily. An analysis/study can be carried out.

Production based incentive scheme can be re-structured.

Marketing department can work more actively in finding more market and

dealers in north India.

It can think of developing exclusive products for south India.

Employees in technical sections need to be motivated to make new

innovations and creative employees should be awarded.


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The need to renovate the drinking water facility and toilet facilities and its

maintenance after renovation

It’s the time to replace canteen furniture and renovation.


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CONCLUSION

KAL is one of the first three wheelers manufactures of India. The products are KAL

are sold under the brand name “KAL”. KAL was established in 15 th march 1978 and

was officially inaugurated in 1984. KAL is a public sector company. As that of any

public sector enterprises KAL’s gestation period was long with many ups and down.

But a committed skillful work force and efficient teams of management as help KAL

to overcome all the obstacles. Company has already entered into the international

market and it has strong hold market in north India states with a slide improvement in

technological aspects and challenge to its competitors like Bajaj Auto. Ltd., Piaggio,

TVS etc. the only draw back is that presently the company is not able to meet its

demanded production to inadequate resources.


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BIBLIOGRAPHY

Company Journals

Department Files

Direct Interview

www.threewhelersindia.com

www.keralaautomobiles.com

www.keralapublicsectorindusty.com


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http://www.keralapublicsectorindusty.com/

http://www.keralaautomobiles.com/

http://www.threewhelersindia.com/