shree cement hr report
TRANSCRIPT
A PROJECT REPORT
ON
Shree Cement Limited
“Selection & Recurtiment policy of shree Cement
Submitted for thepartial fulfillment of two years full time course
Master In Business Administration
Submitted To :- Submitted By :-
FACULTY OF MANAGEMENT STUDIES MAHARISHI
ARVIND INSTITUTE OF ENGINEERING & TECHNOLOGY,
JAIPUR
(Affilated to rajasthan technical university)
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ACKNOWLEDEMENT
project study is successful not only by the single efforts of trainee alone but there are several people who are helpful in making training a completed job done for a specific purpose. It is a matter of great privilege and immense pleasure to be associated with an esteemed organization like Shree Cement Ltd.
Also acknowledging the work and help of all those who have guided us for the completion of the project on time is indeed a duty of ours knowledge the fact that no words can measure their guidance to any extent.
Like wise in completion of my summer training I would like to thanks many authorities and personalities upon whose guidance and sincere cooperation.I made myself to finish and complete the summer training schedule with grace and confidence.
First of all, I would like to pay my sincere and honest regard to , Training Incharge, under whom I have done my training and who aspired me through the training with his skills and knowledge and inculcated in me to face the challenges of the market with confidence.
Secondly, I also dedicated my warm thanks to all the staff members and my colleagues during the summer training who didn’t let me down rather inspired me all the time performing the best.
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PREFACE
The summer training project of management course plays an important role for a
management student to develop him into a well groomed professional. It provides him
the theoretical concepts and practical exposure in the field of application. Summer
training project also provides him an idea of dynamic and versatile professional world as
well as an exposure to the intricacies and complexities of the corporate world.
My summer training in SHREE CEMENT LIMITED Jaipur was an eye opening
experience to see the level of customer satisfaction among people of the jaipur city &
local area
During MBA program I was taught about two dozen subjects which if not applied
properly are a simple waste of time. At SHREE CEMENT LMITED I got a chance to
apply management theories to the latest competitive and marketing oriented
environment.
In two months of market exposure, I learned a lot of various aspects of organizational
structure, departments, sales, communication and their impact. Now I can say one thing
that the best way to learn is at work. It was a real interesting experience and I enjoyed
every part of it and hope that it would be helpful in my future.
-: CONTENTS :-
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1 Industry overview 9
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1.1 Cement industry in India 9
1.2 Major Players in Indian Cement Industry 10
1.3 Process Technology 11
1.3.1 Raw Materials for Cement Production 11
1.4 Process 11
1.4.1 Stages of Cement Production 12
1.5 Types of Cement 15
1.6 Scale of Operations 17
1.6.1 Industrial production 17
1.7 Exports 20
1.8 Policy Initiatives 22
1.9 Future Outlook 22
1.10 Significant Consolidations 22
1.11 Competitor & Environment Analysis 24
PART-2
2 Company Overview – Shree Cement Limited 25
2.1 Introduction 25
2.2 Vision of SCL 26
2.3 Philosophy of SCL 26
2.4 Mission of SCL 27
2.5 SCL manufacturing units 27
2.6 Business & Managerial Challenges for SCL 30
2.7 Market of SCL 31
2.8 SCL’s Brands & Products 32
2.9 Strengths of SCL 32
2.10 SCL’s Manpower profile 35
2.11 Key Operational Highlights 36
2.12 Recognition and Awards 42
2.13 SCL vis-à-vis Competitors 42
2.14 Information Technology at SCL 46
2.15 Bangur Cement – SCL’s Premium Brand 48
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2.16 Comparison between various cement brands 50
PART-3
3 Marketing research 53
3.1 Classification marketing research 54
3.1.1 Process of marketing research 55
3.2 Research methodology 56
3.2.1 Data collection 57
3.2.2 Area covered 59
3.2.3 Data analysis 60
3.2.4 Findings 69
PART-4
4 Questionnaire 70
Performa of Questionnaire 71
Dealer /sub dealer report 72
PART-5
5.1 Conclusion 78
5.2 Recommendation 79
5.3 Bibliography & webliography 81
List of tables
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EXECUTIVE SUMMARY
Cement is a key infrastructure industry. It has been decontrolled from price and
distribution on 1st March, 1989 and delicensed on 25thJuly, 1991 Moreover it is the
material which plays an important role in building not only the colossal structures but
also our dreams in the form of our houses, keeping us protected against the changing
climate. Our country takes the pride of being the second largest manufacturer of cement
in the world preceded by only China. We have constantly been exercising one of the
best practices of cement production, giving rise to productivity, quality and efficiency.
The cement industry in India is experiencing a boom on account of the overall growth of
the Indian economy. The demand for cement, being a derived demand, depends
primarily on the industrial activity, real estate business, construction activity, and
investment in the infrastructure sector. India is experiencing growth on all these fronts
and hence the cement market is flourishing like never before. Indian cement industry is
globally competitive because the industry has witnessed healthy trends such as cost
control and continuous technology up gradation. It is believed that cement demand in
India is expected to grow at 10% annually in the medium term buoyed by housing,
infrastructure and corporate capital expenditures.
As mentioned above, the Indian cement industry is the second largest producer of
quality cement, which meets global standards. The cement industry comprises more
than 50 cement companies with 130 large cement plants with an installed capacity of
156.26 million tonnes and more than 300 mini cement plants with an estimated capacity
of 11.10 million tonnes making a total installed capacity of 167.36 million tonnes.
Continuous technological upgradation and assimilation of latest technology has been
going on in the cement industry. Indian cement industry is modern and uses the latest
technology. India is also producing different varieties of cement like Ordinary Portland
cement (OPC), Portland Pozzolana cement (PPC), Portland Blast furnace Slag Cement
(PBFS), Oil Well Cement, Sulphate Resisting Portland Cement, White Cement, etc.
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Future growth of the industry is belief to be driven by expected GDP growth of more
than 8 percent, growth of the housing sector and the development of roads, ports,
airports and other infrastructure.
This project is pertaining to explore the market perception of Shree cement’s brand vis-
à-vis competitors by taking care of all the components of marketing mix. Keeping main
objective of the study in mind the survey has been done in jaipur city & local area
The methodology of the study contains interacting with distributors and dealers,
questioning them around the various attributes of the market to collect the facts about
the market scenario of the region and eventually exploring their role in marketing of
company’s brand
For past two months, I have been working as a summer trainee on this project assigned
to me . The idea was to study the importance and role of various factors of the
marketing mix in the cement industry in terms of Quality (Product), Price, Promotional
activities, Services to the dealer and Dealers profitability.
The report also throws light on dealer’s opinions and preferences when it comes to
discounts and benefits offered to them and promotional support provided by company to
help dealers. This information is vital to the company in forming its strategy and
schemes to increase its market share.
To start with an attempt was made to understand and diagnose the prevailing situation
of Shree’s cement. Carrying out the industry analysis, competitor’s analysis, channel
analysis and SWOT analysis did it. To get the real market scenario, a survey of dealers
was conducted to get their perception about the prevailing situation and to find their
expectations.
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According to dealer’s feedback Quality, Availability and Profit margin are the factors on
which Bangur is rated high.
A positive relationship was seen between Brand image and Quality of the cement.
Along with this there was no significant relationship between the Profit margin and the
sales.
Survey results confirm that SCL has been able to make a mark in market and perceived
to have good quality and also there is a great demand of cement in market. But survey
results also shows that despite of above mentioned positive factors it has not been able
to make a breakthrough in building its brand name the reason come out to be its low
brand awareness (lack of dealer motivation/ meetings/ advertising) and cut-throat in-
house brand competition.
To increase the brand awareness aggressive promotion need to be carried out ensuring
its effectiveness in making a mark, also as survey results confirm that it’s the
dealer/mason/contractor who is the ultimate decision maker in choosing a brand so
efforts need to be made to build long term relationship with all these people. Meetings,
gifts, and kit distribution are the best tool to ensure masons understanding and
satisfaction. As dealer play a prominent role in sale of a brand every possible effort (like
training/ plant visit/ additional margin/ sufficient POP material distribution/ grace period
of three days for payment) need to be made a strong dealer network.
PART 1INDUSTRY OVERVIEW
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1.1 CEMENT INDUSTRY IN INDIA
Cement industry is a capital intensive and cyclical industry. The demand for cement is
linked to economic activity, can be categorized into two segments, household
construction and infrastructure creation.
The Indian Cement Industry today is the second largest in capacity and production with
an installed capacity of around 157 mtpa after China. The Indian Industry charted a fast
track growth of around 10% per year on an average during the last decade. Demand
has shown an upward surge in recent times buoyed by housing sector, infrastructure
development, and increase in capital expenditure by corporate and growing retail
sector. The cement demand in the country is expected to grow at an annual rate of 8%
for the next five years.
The Indian cement industry is a mixture of mini and large capacity cement plants,
ranging in unit capacity per kiln as low as 10 tonnes per day (tpd) to as high as 7500
tpd. Majority of the production of cement in the country (94%) is by large plants, which
are defined as plants having capacity of more than 600 tpd.
The Industry faces several bottlenecks in high cost of inputs like fuel and power, high
taxes and duties and transportation cost. More than 70% of the input cost in cement
manufacture is beyond the control of the industry and is administered by regulatory
authorities. These include royalties and cess on limestone, tariff for coal, rail transport
and power, duties on finished goods, namely, central excise, local sales tax, octroi, etc.
The only areas where industry can induce cost controls and economy are reduction in
consumption of inputs like fuel and power through energy efficiency, improved
productivity through planned maintenance and reduction of stoppages, etc. The
continuous efforts by the industry in these areas have brought in good results. It is
noteworthy that the energy consumption by the most efficient cement plants in India at
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the level of 665 Kcal per kg of clinker and 69 kWh per tonne of cement are comparable
with the best achieved in the world.
1.2 Major Players in Indian Cement Industry:
Domestic players:1.) ACC Limited
2.) Ambuja Cements Limited
3.) Birla Corporation Limited
4.) UltraTech Cement
5.) Binani Cement
6.) Shree Cements Limited
7.) India Cements
8.) J K Cement
9.) Grasim
10.) Jaypee Group
11.) Madras Cements
12.) Century Textiles
Major foreign players: 1.) Holcim
2.) Lafarge
3.) Italcementi
1.3 PROCESS TECHNOLOGY
1.3.1 Raw Materials for Cement Production
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Cement is usually used in mortar or concrete. Here it is mixed with inert material (called
aggregate), like sand and coarse rock. Portland cement consists of compounds of lime
mixed with oxides like silica, alumina and iron oxide.
There are three major raw materials for cement:
1.) LimestoneLimestone is the main raw material and is the source of calcium carbonate. Calcium
carbonate is burnt to obtain calcium oxide (CaO). The other sources of calcium
carbonate are marl, chalk, seashell and coral reef. Limestone is the most abundant
source of CaO. The other user industries for limestone are iron & steel, fertilizer and
chemicals. Cement is the biggest limestone user in
India accounting for over 75-80% of limestone produced in India. The composition of
limestone used by the various sectors varies. For cement, the CaO content of limestone
should be a minimum of 44%. Typically, 1.4-1.5 tonnes of limestone are required per
tonne of clinker. Thus, for a 1 million tonne cement plant, assured availability of cement
grade limestone reserves of the order of 50-60 mt in the close vicinity is important.
2.) GypsumGypsum is used as a retarding agent. Ground clinker, on contact with water, tends to
set instantaneously because of the very fast reaction between tri-calcium aluminates
and water. In the presence of gypsum, the desired setting time can be achieved.
Gypsum is added to the extent of 5% during the clinker grinding stage. Gypsum is
naturally available in abundance in Rajasthan, Gujarat and Tamilnadu.
3.) Granulated Blast Furnace Slag (GBFS) and Fly AshThe other raw materials that are also used in the manufacture of cement are blast
furnace slag (a waste product obtained from iron-smelting furnaces) and fly ash (leftover
ash from a thermal power station). Limestone contains about 52% of lime and about
80% of this lime is lost during ignition of the raw materials. Similarly, Clay contributes
about 57% silica of which about 25% is lost during ignition. GBFS is obtained by
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granulation of slag obtained as a by-product during the manufacture of steel. It is a
complex calcium aluminium silicate and has latent hydraulic properties. That is why it is
used in the manufacture of Portland blast furnace slag cement.
1.4 PROCESS
1.4.1 Stag es of Cement Production
There are seven stages of cement production at a cement plant:
1. Procurement of raw materials2. Raw Milling - preparation of raw materials for the pyroprocessing system3. Pyroprocessing - pyroprocessing raw materials to form cement clinker4. Cooling of cement clinker5. Storage of cement clinker6. Finish Milling7. Packing and loading
Figure 1.1: Cement manufacturing from the quarrying of limestone to the bagging of
cement
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While adding fresh capacities, the cement manufacturers are very conscious of the
technology used. In cement production, raw materials preparation involves primary and
secondary crushing of the quarried material, drying the material (for use in the dry
process) or undertaking a further raw grinding through either wet or dry processes, and
blending the materials.
Clinker production is the most energy-intensive step, accounting for about 80% of the
energy used in cement production. Produced by burning a mixture of materials, mainly
limestone, silicon oxides, aluminium, and iron oxides, clinker is made by one of two
production processes: wet or dry; these terms refer to the grinding processes although
other configurations and mixed forms (semi-wet, semi-dry) exist for both types.
In the dry process, the raw materials are ground, mixed, and fed into the kiln in their dry
state.
In the wet process, the crushed and proportioned materials are ground with water,
mixed, and fed into the kiln in the form of slurry.
The choice among different processes is dictated by the characteristics and availability
of raw materials. For example, a wet process may be necessary for raw materials with
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high moisture content (greater than 15%) or for certain chalks and alloys that can best
be processed as a slurry. The dry process is the more modern and energy-efficient
configuration. In general, the dry process is much more energy efficient than the wet
process, and the semi-wet somewhat more energy efficient than the semi-dry process.
The semi-dry process has never played an important role in Indian cement production
and accounts for less than 0.2% of total production.
In 1960, around 94% of the cement plants in India used wet process kilns. These kilns
have been phased out over the past 46 years and at present, 96.3% of the kilns are dry
process, 3% are wet, and only 1% are semidry process. Dry process kilns are typically
larger, with capacities in India ranging from 300- 8,000 tonnes per day or tpd (average
of 2,880 tpd). While capacities in semi-dry kilns do range from 600-1,200 tpd (average
521 tpd), capacities in wet process kilns range from 200-750 tpd (average 425 tpd).
Over the last decade, increased preference is being given to the energy efficient dry
process technology so as to obtain a cost advantage in a competitive market. Moreover,
since the initiation of the decontrol process, many manufactures have swSHREE
CEMENThed over from the wet technology to the dry technology by making suitable
modifications in their plants. Due to new, even more efficient technologies, the wet
process is expected to be completely phased out in the near future. Due to the
dominant use of carbon intensive fuels such as coal in clinker making, the cement
industry has been a major source of carbon dioxide (CO2) emissions. Besides energy
consumption, the clinker making process also emits CO2 due to the calcining process.
1.5 TYPES OF CEMENT
There are different varieties of cement based on different compositions according to
specific end uses, namely, Ordinary Portland Cement, Portland Pozzolana Cement,
White Cement, Portland Blast Furnace Slag Cement and Specialised Cement.
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The basic difference lies in the percentage of clinker used.
1.) Ordinary Portland Cement (OPC):OPC, popularly known as grey cement, has 95 per cent clinker and 5 per cent gypsum
and other materials. It accounts for 70 per cent of the total consumption.
2.) Portland Pozzolana Cement (PPC):PPC has 80 per cent clinker, 15 per cent Pozzolana and 5 per cent gypsum and
accounts for 18 per cent of the total cement consumption. It is manufactured because it
uses fly ash/burnt clay/coal waste as the main ingredient.
3.) White Cement:White cement is basically OPC - clinker using fuel oil (instead of coal) with iron oxide
content below 0.4 per cent to ensure whiteness. A special cooling technique is used in
its production. It is used to enhance aesthetic value in tiles and flooring. White cement is
much more expensive than grey cement.
4.) Portland Blast Furnace Slag Cement (PBFSC):PBFSC consists of 45 per cent clinker, 50 per cent blast furnace slag and 5 per cent
gypsum and accounts for 10 per cent of the total cement consumed. It has a heat of
hydration even lower than PPC and is generally used in the construction of dams and
similar massive constructions.
5.) Specialised Cement:Oil Well Cement is made from clinker with special additives to prevent any porosity.
6.) Rapid Hardening Portland cement:Rapid Hardening Portland Cement is similar to OPC, except that it is ground much finer,
so that on casting, the compressible strength increases rapidly.
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7.) Water Proof Cement:Water Proof Cement is similar to OPC, with a small portion of calcium stearate or non-
saponifiable oil to impart waterproofing properties.
In India, the different types of cement are manufactured using dry, semi-dry, and wet
processes. In the production of Clinker Cement, a lot of energy is required. It is
produced by using materials such as limestone, iron oxides, aluminium, and silicon
oxides. Among the different kinds of cement produced in India, Portland Pozzolana
Cement, Ordinary Portland Cement, and Portland Blast Furnace Slag Cement are the
most important because they account for around 99% of the total cement production in
India.
The Portland variety of cement is the most common one among the types of cement in
India and is produced from gypsum and clinker. The Ordinary Portland cement and
Portland Blast Furnace Slag Cement are used mostly in the construction of airports and
bridges. The production of white cement in the country is very less for it is very
expensive in comparison to grey cement. In India, while cement is usually utilized for
decorative purposes, marble foundation work, and to fill up the gaps between tiles of
ceramic and marble.
The different types of cement in India have registered an increase in production in the
last few years. Efforts must be made by the cement industry in India and the
government of India to ensure that the cement industry continues innovation and
research to come up with more and more varieties in the near future.
1.6 SCALE OF OPERATIONS
The cement industry has witnessed a significant change in the scale of operations. In
1961, the largest kiln in operation had a capacity of 750 tpd. In 1970, of the total 119
kilns, 1 had over 1,000 tpd capacity, with 55 having less than 400 tpd capacity. In 1980,
11 of the total 141 kilns were over the 1000 tpd mark, with 1 kiln having a capacity
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larger than 3,000 tpd (roughly 1 mtpa). The 1990s saw still higher capacity 4500-5000
tpd (or 1.5 mtpa) kilns. The recent practice for a large size plant is to have 6,500-7,000
tpd (or 2.5 mtpa) capacity.
1.6.1 Industrial production:
The cement industry is enhancing its production levels as new homes and offices are
being built, and in keeping with the economy’s annual growth rate. According to the
Cement Manufacturers Association, the overall cement production rose by 8.11 per cent
during 2010-11 to 168.29 million tonnes (mt) as against 155.66 mt in 2009-10.
Table 1.1 : Statistics
Cement (million tonnes)
2009-10 2010-2011
(Apr-Mar)
(a) Production 155.66 168.31
(b) Dispatches (Including Export) 155.26 167.67
(c) Export 3.65 5.89
(d) Cap. Uti. (%) 96 94
Source: Cement Manufacturers’ Association
PRODUCTION SITES OF VARIOUS BRANDS OF CEMENT
BRAND NAME PRODUCTION SITE
Shree Beawer Distt. Ajmer
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Bangur Rass Distt. Pali. Jetaran
Cemento Rass Distt. Pali. Jetaran
Ambuja Rabriyawas Distt. Pali. Jeteran
Binani Pindwada Distt. Sirohi
Ultra Tack Shambhupura Distt. Chittorgarh
Birla Chetak Chittorgarh
Birla Uttam Modak Distt. Kota
J.K. Laxmi Banas Distt.Sirohi
J.K. Super Nimbaheda Distt. Chittorgarh
ACC Lakheri, Distt. Bundi
Table 1.2: Production and growth rates
CEMENT PRODUCTION Weight: 1.99%Month
Production (Thousand Tonnes) Growth Rates (%)
2008-09 2009-10 2010-11 08-09 to
09-10 09-10to 12-13
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April 12240 13730 14520 12.2 5.8May 12630 13490 14820 6.8 9.9June 12010 13410 14220 11.7 6.0July 11160 12720 13910 14.0 9.4August 11160 11480 13400 2.9 16.7September 10845 12630 13310 16.5 5.4October 12218 13370 14370 9.4 7.5November 11599 12970 13650 11.8 5.2December 12968 14010 14630 8.0 4.4January 13571 14550 15360 7.2 5.6February 12757 13500 15230 5.8 12.8March 14650 15450 16890 5.5 9.3Cumulative Total (Apr-Mar) 147808 161310 174310 9.1 8.1
Source : Department of Industrial Policy & Promotion
1.7 EXPORTS20
The export of Indian cement has increased over the years, giving a boost to the Indian
cement industry. The demand for cement in the foreign countries is a derived demand,
for it depends on industrial activity, real estate, and construction activity. The cement
industry in India has around 300 mini cement plants and 130 large cement plants. The
total production capacity of these plants is around 167.36 million tons. The India cement
industry is technologically very advanced, as a result of which the quality of Indian
cement is now considered the second best in the world. This has given a major boost to
the Indian export of cement. The production of cement in India is not only able to meet
the domestic demand, but large amounts are also exported. A fair amount of clinker and
cement by-products are also exported by India. As the quality of Indian cement is very
good, its demand in the international market is always high.
In 2001-2002, 3.38 million tons of cement was exported from India. That figure stood at
3.47 million tons in 2002-03, and 3.36 million tons in 2003-04. In 2001-2002, 1.76
million tons of clinker was exported from India. In 2009- 2010 clinker exports amounted
to 6.45 million tons, and in 2010- 2011 the figure stood at 9.64 million tons. This shows
that the export of Indian cement has been increasing at a steady pace over the years.
Export of India cement has been mostly to the West Asian countries.
The major companies exporting Indian cement are:
• Gujarat Ambuja
• Ultra Tech Cement
• Aditya Cement
Export of Indian cement has registered growth a fair amount of growth, giving a boost to
the Indian economy. That it continues to rise, more efforts must be made by the cement
industry in India and the government of India.
The types of cement in India have increased over the years with the advancement in
research, development, and technology. The Indian cement industry is witnessing a 21
boom as a result of which the production of different kinds of cement in India has also
increased.
By a fair estimate, there are around 11 different types of cement that are being
produced in India. The production of all these cement varieties is according to the
specifications of the BIS.
1.8 POLICY INITIATIVES
FDI Policy: the cement sector has been gradually liberalized. 100 per cent FDI is now
permitted in the cement industry.
1.9 FUTURE OUTLOOK
Considering an expected production and consumption growth of 9 to 10 per cent, the
demand-supply position of the cement industry is expected to improve from 2009-10
onwards, resulting in an expected price stabilization. The cement industry is poised to
add 111 million tones of annual capacity by the end of 2010-11 (FY 10), riding on the
back of an estimated 141 outstanding cement projects.
1.10 SIGNIFICANT CONSOLIDATIONS
As discussed earlier in this report, the cement industry is witnessing a number of
Mergers & Acquisitions (M&As). The extent of concentration in the industry has
increased over the years.
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This concentration is mainly because of the focus of the larger and the more efficient
units to consolidate their operations by restructuring their business and taking over
relatively weaker units. The relatively smaller and weaker units are finding it difficult to
withstand the cyclical pressure of the cement industry.
Some of the key benefits accruing to the acquiring companies from these acquisition
deals include:
Economies of scale resulting from the larger size of operations
Savings in the time and cost required to set up a new unit
Access to new markets
Access to special facilities / features of the acquired company
Benefits of tax shelter.
The relative market share of large players in the cement industry has changed
significantly over the years. Consolidation of capacities has seen UltraTech, Grasim,
India Cement and Gujarat Ambuja emerging as the leading players in India apart from
ACC, which has been the market leader during all the years excepting FY2001. All the
players have resorted to a combination of Greenfield capacities as well as takeover of
existing capacities for growth.
Some examples of the consolidation witnessed among domestic players in the recent
past include:
Gujarat Ambuja taking a stake of 14 per cent in ACC
Gujarat Ambuja taking over DLF Cements and Modi Cement.
ACC taking over IDCOL
India Cement taking over Raasi Cement and Sri Vishnu Cement
Grasim's acquisition of the cement business of L&T
Grasim taking over Indian Rayon's cement division.
Grasim taking over Sri Digvijay Cements.
L&T taking over Narmada Cements
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1.11 Competitor & Environment Analysis
PORTER’S MODEL
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Figure 1.3: Porter’s model
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PART 2COMPANY OVERVIEWShree Cement Limited
2.1 INTRODUCTIONBeing among the top ten cement producers in the country Shree Cement Limited (SCL)
enjoys a market share of about 16 per cent in Northern region of India. Over the years,
Shree Cement has built an identity as one of the world’s most efficient cement
manufacturers. First of all, its production has been consistently in excess of its rated
capacity. Secondly company’s per tonne energy consumption is one of the lowest in the
world. And also it has a unique distinction of operating both its cement as well as
captive power plant on alternative fuel.
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Table 2.1: Shree- Market Share
The BG Bangur family is the principal promoter of Shree Cement. Mr. H. M. Bangur is
the Managing Director while Mr. M. K. Singhi is the current executive director of Shree
Cement. It is located at Beawar, in Ajmer district 185 Kms. from Jaipur off the Delhi-
Ahmedabad highway.
2.2 Vision of SCLTo register a strong consumer surplus through a superior cement quality at affordable
prices.
2.3 Philosophy of SCLShree Cement is guided by the philosophy that productivity will lead to profitability which
ultimately will lead to the prosperity of the region and all concerned with SCL.
2.4 Mission of SCLThe mission of the organization is highlighted by the following.
To sustain its reputation as the most efficient cement manufacture in the world.27
To strengthen realizations through intelligent brand building.
To drive down cost through innovative plant practices.
To increase the awareness of superior product quality through a realistic and
convincing communications process with consumers.
2.5 SCL manufacturing unitsPresently Shree Cements has three units. Two units are at Beawer (incorporated in
1979 and1997) and third unit is at Ras (Started in 2005). Fourth unit at Ras has been
started in March 2010 and another two units at Ras and Khushkhera near Alwar are
also started to enhance the capacity of the company to 10 mtpa from the present figure
of 6 mtpa by the year 2011. The proximity to Delhi, Jaipur and Haryana, which are the
most lucrative markets in the region, makes it a strategic location.
UNIT-1Incorporated in 1979.
Put up in 1985.
Cement Production (Expected Production) – 1.20 million tonnes
UNIT-2Put up in 1997.
Cement Production (Expected Production) – 2.10 million tonnes
UNIT – 3Incorporated in 2010
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Cement Production (Expected Production) – 1.50 million tonnes
UNIT – 4Incorporated in March 2011
Cement Production (Expected Production) – 1.50 million tonnes
UNIT - 5Started in Ras,
Unit – 6Grinding unit at Kuskhera in Rajasthan.
Figure 2.1: SCL Production vis-à-vis Market Share in Northern Region
The growth of company’s market share is going hand in and with its production,
supporting its cyclical business model of produce more-sell more-reinvestment more.
Capacity enhancement at SCL has also been considerable from its 0.6 mtpa in 1985
growing 10 times to 6 mtpa presently and is projected to touch a figure of 10 mtpa by
2010.
2.6 Business & Managerial Challenges for SCLCement market for SCL is highly competitive with major competitors having advantage
of brand equity, capacity and early movers. The major competitors are Binani, Birla 29
(with products like Birla Super and Birla Chetak), Grasim (with products like Vikram and
Birla Plus), Gujarat Ambuja, JK (with products like JK Nimbahera), Laxmi, Mangalam
(with products like Mangalam and Birla Uttam), ACC, DCM Shriram, L & T and
Kamdhenu. Each of these players has their dominance across whole Rajasthan in
addition to their respective regional dominance.
Another issue is that the product (cement) cannot be differentiated clearly on the basis
of quality and hence, cost plays one of the most important roles in this industry. If the
company can control cost of manufacturing & distribution, then only would profitability of
the company increase.
Logistics is the most important cost associated with cement industry. This is the single
most important reason for strong dominance of all cement companies in the regions
around their factory. But if this system can be improved upon, and costs can be
managed, then Shree Cements Ltd. can strengthen their hold in present states of
distribution as well as look forward to gaining foothold in newer and farther regions.
2.7 Market of SCLEach cement manufacturer has a primary and secondary market. The former is one,
which is the closest to the production centre where it fetches the best realizations while
the latter is usually at a distance where realizations are lower.
Table 2.2: Market Classification for Shree Cements Ltd.
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SCL with a market share of 16% has the second largest market presence in the
northern region, next only to the Gujarat Ambuja Cement and ACC combined. SCL
positioning within Rajasthan (in the north of the state) makes it the closest among all
Rajasthan manufacturers to the lucrative markets of Delhi, Haryana and some parts of
Punjab, giving it a significant edge in transport costs. The other cement units are
located further down, at distances ranging from 150- 200 kilometres.
Shree Cements is one of the largest cement companies in North region having existing
capacity of 5.5mn tonnes of cement per annum located in central Rajasthan. The
company primarily caters to Rajasthan, Punjab, Haryana, Delhi and Uttranchal in the
Northern region and Uttar Pradesh in Central region. Rajasthan accounts for
approximately 30% of the company's sales while Delhi and Haryana together account
for approximately 40% of sales.
2.8 SCL’s Brands & ProductsShree manufactures:
• Ordinary Portland Cement (OPC)
• Red Oxide Cement (ROC)
Its output is marketed under the ‘Shree Ultra Ordinary Portland Cement’ and ‘Shree
Ultra Red
Oxide Cement’ brand names. The product today constitutes almost 37% of SCL’s
sales. Under its premium products category, SCL has launched ‘Bangur Cement’ Dec.
2005 and a new brand
‘Tuff Cemento 3556’ has been introduced in the market in April 2011. The company
positioned its brands around longer life (durability), emphasizing product longevity.
2.9 Strengths of SCL
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1.) Low Cost Producer: SCL is one of the lowest cost producers of cement in India.
The prime reasons behind this are captive power plants, use of pet coke in both captive
power plant and kiln and proximity to the markets.
2.) Limestone Reserve: SCL has a total of 700 mn tones of limestone reserve which
would be sufficient to meet its requirements for the next 40 years. Shree Cement's third
unit is located at the pithead of limestone reserve unlike the other two units in Beawar,
Rajasthan. Unit IV, which is expected to be commissioned in FY08, would also be
located at the pithead of company's limestone reserve. As the new plants are located at
the pithead of limestone reserve, the raw material cost per ton of cement is expected to
go down as the company would be saving in cost of transportation.
3.) Captive Power Plants: During FY05, the company sourced 99% of power
requirement from its captive power plant. The company has existing power plant
capacity of 42 MW. The company is installing additional power plant of 18 MW
capacities, which would supply power to its new cement units, thereby ensuring
continuation of self sufficiency in terms of power requirement. Shree Cement's power
usages per ton of cement at 75 Kwh is amongst the lowest in the industry. The
company uses low cost pet coke in both its power plants and kiln. Pet coke is not only
cheaper compared to the imported coke but also has high calorific values thereby
reducing the overall cost.
4.) Strong sales network of 28 sales offices, 1200 dealers and 4000 retailers.
5.) Progressive Management: Shree Cement supplemented its attractively low capital
investment per tonne with one of the lowest manufacturing costs in the Indian cement
industry. The path of sustainable growth has been made possible because of
management strategy of taking triple bottom-line approach of Economic, Environmental
and Social performance listed below:
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6.) Mining: Limestone being the predominant raw material, Shree Cement plants are
situated near limestone quarry fields. To minimize the transportation cost, Shree
Cements has leased two mines one at Beawer and other at Ras with reserves that will
last for a long time. The Ras mines give a limestone of very good quality which is easier
to process.
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2.10 SCL’s Manpower profile
Well experienced and skilled manpower resources capable of handling both
project implementation and operations.
The skill enhancement is a regular exercise under a well defined training manual.
Company imparts more than 20,000 hours of in-house training to its employees
every year
Figure 2.5: Manpower profile at SCL
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2.11 Key Operational Highlights The cost of production of the Company is one of the lowest in India
Operating profit margin is highest in World Cement Industry
100% self sufficiency in meeting power requirement
100% self dependent on limestone sourcing
Consistent dividend paying company
Recognized as one of the most Energy Efficient units in India
Strong brand image – Bangur Cement, Shree Ultra Red Oxide Cement and
Shree Ultra Ordinary Portland Cement have high consumer recall. New super
premium brand Tuff Cemento produced with German technology has a lot of
expectations.
Initiatives for global warming reduction
Pioneered in the application of innovative Electro static precipitator technology in Dg power generation to save fuel and combat pollution, and replaced HSD by LDO.
Achieved unity power factor
… In electrical distribution system to reduce maximum demand, and transmission / distribution losses
Partial utilization of waste heat
35
… For 3 MW power generation.
Initiator in the use of pet coke for power generation in India
36 MW captive thermal power plant under commissioning to generate quality power for the plant, avoid transmission and distribution losses, and provide surplus power to Rajas than.
SAVINGS: Rs 496.46 Million pa
Development of DD conesIn house development of deduiling cones cyclones resulting in reduction in pressure drop, higher outputs and lower energy consumption.
Single roller press for tow Ball Mills
Capacity enhancement & utilization of CM –2 Roller press for capacity increase and energy saving increase CM –1, Energy saving –2.02 KWH / The
Objective, CSI (Cement sustainability initiative)
1. The purpose of the Cement Sustainability Initiative is to:2. Explore what sustainable development means for the participating companies
and the cement industry.3. Identify and facilitate actions that companies can take as a group and individually
to accelerate the move towards sustainable development.4. Provide a framework through which other cement companies can participate,
and5. Provide a framework for engaging external stakeholders.
Agenda, CSI
The 10 companies involved in the CSI have chosen to develop an agenda for three reasons:To prepare for a sustainable future by making a more efficient use of natural resources and energy, and engaging with lock issues increase emerging market
To meet the expectations of stakeholders and maintain their ‘license to operate’ increase communities across the world through a greater transparency of operations effective engagement with society and initiating action, which lead to sustained positive changes, and
To individually understand and build new market opportunities through process innovation, which achieve greater resource/ energy efficiency and long – term coos
36
savings; product and service innovation to reduce environment impacts and work with other industries on novel uses of – product and waste material in cement production.
The companies have identified six key areas where they believe that the CSI can make a significant contribution towards a more sustainable society:
Climate protection.
Fuels and raw materials.
Employee health and safety.
Emissions reduction.
Local impacts.
Internal business processes.
Productivity
Shree Cement supplemented its attractively low capital investment per tonne with one of the lowest manufacturing costs in the Indian cement industry.
Timely execution of Unit-III along with better price realization and cost optimization measures made the year a hallmark for the Company:-
The turnover of the Company has more than doubled during the year. The operating profit margin of the Company at 44.84% is highest in the Indian
cement industry. The proportion of blended cement in the total production has increased to 76% in
the current year against 54% in the previous year. Company started use of wet fly ash for producing blended cement which is economical and environment friendly.
The capacity utilization level of the Company further improved during the year from 114% to 116% with Unit-III recording 99% in its very first full year of operation. This compares well with the all India average of 94%.
Continued thrust on improving energy consumption levels has brought down power and fuel consumption as under:
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Although Power consumption for the year indicates marginal increase during the year, the unit-wise consumption has gone down from last year. The
Reduction in energy consumption with increasing production base has significantly contributed to cost efficiency of the Company.
Dynamic and efficient logistic management practices have enabled Company to contain increase in freight cost in spite of rising diesel prices and loading restrictions on trucks. Company has made optimal use of its in-house railway sidings facility with appropriate route plan to limit freight cost.
The Company's marketing strategy of maintaining multiple brands competing with each other with a view to garner increased market share has yield good returns. As a result,
Company has retained market leadership status in Rajasthan and Delhi.
“Jung Rodhak” brand has further strengthened its presence in its segment in the North India market.
“Bangur Cement” launched last year in the premium quality segment, has been well received in the market and has been improving its market share. Its marketing strategy of appointment of Business associates and Business partners has enabled the Company to keep its debtors levels at zero and minimizing the Working Capital requirement.
Company has introduced another premium quality brand “Tuff Cemento 3556”. The new brand has started attracting customer’s attention and is getting good response.
The proportion of trade sale to total sale increased during the year from 66% to 74% showing higher customer recall and satisfaction.
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The Company continued with its highest credit rating of PR1+ for its short-term debt and AA for its long-term debt enabling containment of its cost of funds despite large borrowing requirements for its capital expenditure programme
The interest cost has been kept at a low level in the rising interest rate environment through optimal utilization of funds and judicious mix of rupee and fully hedged foreign currency borrowings.
Timely execution of projects is a hallmark of the Company. The 1.5 MTPA capacity expansion with captive power plant of 18 x 3 MW completed in Feb 08 has been achieved well within the targets both time and budget.
During the year Company has undertaken implementation of an “Enterprise Resource Planning” (ERP) Project with Oracle E-Business Suite to manage its expanding business operations. ERP Project shall help it in improving its business matrices by process optimization, improving logistics and integration across disciplines. The project is expected to be operational in FY 2010-11
2.12 Recognition and Awards• Whitehopleman UK - International Cement Consultants have consistently maintained 4
star rating for Shree since 2000 (No one in the world has been assigned a 5 star
rating!!)
• Excellence in Energy Management Award 2006 from Confederation of Indian Industry
for the second time
• National Awards for Energy Conservation and Best Thermal and Electrical Energy
from
Ministry of Power, Govt of India
• National Safety Awards by Ministry of Labour, Govt. of India
• ICWAI National award 2008 for excellence in cost management
• Golden Peacock Award-2009 &2010 in recognition of its excellent Environment
Management practices
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2.13 SCL vis-à-vis CompetitorsSCL has been omnipresent in the performance with various achievements within a short
period of time. Following figures suggests that it has been doing the best job among its
peers in terms of high capacity utilization, low power consumption, low power
generation cost, and low fuel consumption ratio.
Table 2.4: SCL figures vis-à-vis competitors
It has also been encountering the lowest Variable Cost in its peer group because of its
constant efforts in saving cost of power and fuel consumption which is not only the
40
lowest but is approx. 75% of the average of other players. Freight and selling expenses
of for SCL is also the lowest amongst all.
Table 2.5: SCL’s Variable Cost Comparison with others
SCL’s ability to produce cement with lowest power consumption and other low costs of
production and raw material procurement has resulted into the top EBITDA Margin
figures for SCL amongst all its competitors.
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Figure 2.6: Power Cost Comparison
Figure 2.7: EBITDA Margin Comparison
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2.14 Information Technology at SCLSCL has embraced Information Technology in a big manner and made investments to
establish strong IT infrastructure:
• IT Policy & Quality Standards: SCL has clearly defined IT policy. Backup and
Disaster
Recovery Policy, SCL Internet/Network Access Policy and Business Continuity Plans
have been endorsed and religiously implemented.
• ‘SUMriddhi’ - Shree Enterprise Resource Planning: The Shree ERP programme,
christened ‘SUMriddhi’, was developed deploying Oracle 9i RDBMS and Developer
2000 platform. A comprehensive ERP program was designed to integrate all functional
modules, namely Financial Accounting & Costing (FA), Material Management (MM),
Personnel and Payroll (PP), Laboratory and Quality Control, Integrated Management
System (IMS) and Raw Material Procurement (RMP) with the objective to make
43
operations online. The company expects to implement ERP ‘live’ across the
organisation in 2010-11.
• Online operations of Sales and Distribution: Company successfully implemented
the computerization of its sales and distribution functions by integrating all
branches/dealers through a secured connectivity with the plant for online order
processing. In the second phase, necessary enhancements will make the system work
in a centralized manner using dedicated and secure Virtual Private Network (VPN)
across its branch/dealer network.
• SCL’s IT Infrastructure: The Company has a scalable, state-of-the-art IT network
infrastructure, with optic fibre cable-based gigabit backbone, high-end layer 3
swSHREE CEMENThes, Cisco routers and IBM corporate-computing servers. Shree
has a secure network across its corporate and site locations with e-trust firewall
supplemented with intrusion detection system and Active Virus Defense Solution from
Network Associates. The organisation is provided with the latest computing tools in
hardware and software.
• SCL’s corporate website: The Company launched its content-exhaustive corporate
website shreecement.com on 1 August 2003. The portal is dynamic, informative and
user-friendly with a menu-driven interface. The website contains the latest information
about the company with news flashes and a photo gallery. The website is e-commerce
enabled, which provides access to customers on their latest account statement and
vendors/ suppliers on order positions for the e-procurement program.
• E-Procurement: Shree implemented an e-procurement programme to facilitate
purchases through the reverse auction process to maximize price benefits and
transparency.
• Paperless office: Shree is moving towards the ultimate goal of achieving a paperless
office environment through a widespread use of e-mails and instant messaging for daily
communication across all its offices. A program was undertaken for storing and
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cataloguing the huge archive of blueprints of technical drawings in a digitised form for
instant accessibility.
• Raw material procurement: The entire raw material procurement operation was
integrated with ‘SUMriddhi’ - Shree ERP, to increase efficiency and control.
• Training: Shree is committed to enhance the IT skills of not only employees across all
functions but their family members as well. As a result, training is an ongoing process
and more than 200 personnel were imparted training across departments.
• Online Knowledge management: Shree has launched a platform for sharing
knowledge across the enterprise. A knowledge management tool was developed and
implemented through which people across all levels can contribute and share
achievements, domain expertise, social and cultural ideas. This also provides a ‘public
folder’ for up-to-date information on the cement industry and the company.
• Network Security: SCL network is protected by the high end e-Trust Firewall from
Computer Associates and Network Associates Intrusion Detection System (IDS). SCL
has implemented Network Associates Active Virus Defence for virus protection and
SPAM control. All network resources are protected by adopting strong password
policies. SCL has enforced three-layer security for all data and information systems.
2.15 Bangur Cement – SCL’s Premium Brand
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Bangur cement started with a vision to be the most effective and efficient cement brand
of the country. As in Bangur cement, SCL aimed at providing the best quality cement
that ensures customer satisfaction. The Bangur cement is advertised with a tagline
saying “The best, not inexpensive”.
To serve the fast growing National Capital Region (NCR) with immediate and prompt
services, Bangur cement is establishing a grinding capacity at Khuskhera in Alwar
District of Rajasthan, which is just 80 kms away from the capital. Excelling in the quality,
price, availability and packaging of the product, SCL aspires to be the first choice of the
consumers. The Bangur cement plant is one of the most modern and sophisticated
plants in the India equipped with state-of-the-art German Technology.
Following factors makes Bangur cement, the SCL’s premium brand:
Best Quality of Lime Stone: The Ras belt is among the finest quality limestone
deposits in India. Importantly, it is a single source of limestone belt where all
necessary ingredients of cement are available in limestone and there is no
dependency on outside sources, thus enabling consistency in quality.
Better Quality Control, Clinkerisation and superior cement grinding makes the
quality of the brand one of the best in the industry. State-of-the-art technology: The plant has been set up in the technical
collaboration with internationally acclaimed German cement manufacturer.
In line with its marketing strategy, Bangur cement realized sales predominantly in the
trade segment. The brand contribution to more then 40% of the trade sale of the
company, registering 14.20 Lac MT sales out of the total of 35.92 Lac MT .In fact ,
trade sales accounted for 95% of total sales of BANGUR CEMENT while non trade
sales was just 5%. BANGUR CEMENT registered its 55% sales of its total sales in its
46
home market, Rajasthan. By selling within a smaller radius, the company was able to
notch higher net realization because of lower logistics.
MARKET SHARES: - Rajasthan-9%, Haryana-6%, Delhi-4%.
2.16 COMPARISON OF POTENTIALITYOF VARIOUS CEMENT BRANDS
COMPARISON OF POTENTIALITY OF VARIOUS CEMENT BRANDS IN RAJASTHAN
BRAND NAME SALES (IN MATRIC TONES)
AMBUJA 121000
ULTRA-TACH 145000
BINANI 103000
BANGUR 55000
SHREE ULTRA 100000
TUFF CEMENTO 40000
J.K.LAXMI 83000
ACC 17000
MANGLAM 40000
BIRLA CHETAK 81000
J.K.SUPER 65000
SHREE RAM 6000
COMPARISON OF POTENTIALITY OF VARIOUS CEMENT BRANDS IN RAJASTHAN (IN TRADE)
47
BRAND NAME SALES (IN MATRIC TONES)
JAIPUR DISTRICT JAIPUR LOCAL
AMBUJA 25000 17000
ULTRA-TACH 26000 14000
BINANI 12000 10000
BANGUR 6500 4000
SHREE ULTRA 8500 7500
TUFF CEMENTO 4500 3000
J.K.LAXMI 7500 5500
ACC 4500 3000
BIRLA UTTAM 4000 3000
BIRLA CHETAK 5000 3000
J.K.SUPER 6500 5000
Figure 2.8 COMPARISON OF POTENTIALITY OF VARIOUS CEMENT BRANDS IN RAJASTHAN (IN TRADE)
48
49
Factors Affecting Recruitment process :-
Factors which affect the recruitment process can be classified into two heads:-
External Factors -
Supply and demand
Unemployment rate
Labor market
Political - social
Image
Internal Factors -
Recruitment policy
Human resource planning
Size of the firm
Cost
Growth and expansion
These are the main recruiting stages
Sourcing
1. advertising, a common part of the recruiting process, often encompassing
multiple media, such as the Internet, general newspapers, job ad newspapers,
50
professional publications, window advertisements, job centers, and campus
graduate recruitment programs.
2. recruiting research, which is the proactive identification of relevant talent who may
not respond to job postings and other recruitment advertising methods done in. This
initial research for so-called passive prospects, also called name-generation, results
in a list of prospects who can then be contacted to solicit interest, obtain a resume/CV,
and be screened .
Screening & selection
Suitability for a job is typically assessed by looking for skills, e.g. communication,
typing, and computer skills. Qualifications may be shown through résumés, job
applications, interviews, educational or professional experience, the estimony of
references, or in-house testing, such as for software knowledge, typing skills ,
numeracy, and literacy, through psychological tests or employment testing. In
some countries, employers are legally mandated to provide equal opportunity in
hiring. Agencies are particularly suitable for recruitment of executives and specialists.
It is also known as RPO (Recruitment Process Outsourcing)
Definition of selection
Select mean to choose. Selection is the process of picking individuals who have
relevant qualifications to fill jobs in an organisation. The basic purpose is to
choose the individual who can most successfully perform the job from the pool of
qualified candidates.
The purpose of selection is to pick up the most suitable candidate who would
meet the requirements of the job in an organisation best, to find out which job
applicant will be successful, if hired. To meet this goal, the company obtains and 51
assesses information about the applicants in terms of age, qualifications, skills,
experience, etc. the needs of the job are matched with the profile of candidates. The
most suitable person is then picked up after eliminating the unsuitable applicants
through successive stages of selection process. How well an employee is
matched to a job is very important because it is directly affects the amount and
quality of employee’s work. Any mismatched in this regard can cost an organisation
a great deal of money, time and trouble, especially, in terms of training and operating
costs. In course of time, the employee may find the job distasteful and leave in
frustration.
The Process
Selection is usually a series of hurdles or steps. Each one must be successfully
cleared before the applicant proceeds to the next one. The time and emphasis
place on each step will definitely vary from one organization to another and indeed,
from job to job within the same organization. The sequence of steps may also vary
from job to job and organization to organization.
For example :- some organizations may give more importance to testing while others
give more emphasis to interviews and reference checks. Similarly a single brief
selection interview might be enough for applicants for lower level positions, while
applicants for managerial jobs might be interviewed by a number of people.
A company is known by the people it employs. In order to attract people with talents,
skills and experience a company has to create a favourables impression on the
applicants’ right from the stage of reception. Whoever meets the applicant
initially should be tactful and able to extend help in a friendly and courteous way.
Employment possibilities must be presented honestly and clearly. If no jobs are
available at that point of time, the applicant may be asked to call back the
personnel department after some time.
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The selection process can be successful if the following requirements are satisfied
1. Someone should have the authority to select. This authority comes from the
employment requisition, as developed by an analysis to the workload and work force.
2. There must be some standard of personnel with which a Prospective employee
may be compared, i.e. a comprehensive job description and job specification should
be available before hand.
3. There must be a sufficient number of applicants from whom the required
number of employees may be selected.
The ability of an organization to attain its goal effectively and to develop in a
dynamic environment largely depends upon the effectiveness of its selection
programme. If the right person is selected, he is valuable asset to the organization
53
BARRIERS TO EFFECTIVE SELECTION The main objective of selection process is to hire people having competence and
commitment towards the given job profile. But due to some reason the main
purpose of effectively selecting candidates is defeated. These reasons are:
1: Perception or the Halo effect:- Many a times the interviewer selects a
candidate according to the perception he has or he made up while talking or looking
at the individual. This way he does not see through the caliber or the efficiency of
the individual and many times it leads to the selection of the wrong candidates.
2: Fairness:- During the selection process the interviewer does not select the
individual on the basis of his knowledge and hence the right type of the candidates is
not selected.
3: Pressure:- The people from the HR department and also have a lot of
pressure from the top management and from other top class people for selecting
the candidates they want. This ways the purpose of effective selection process
of effective selection process is defeated as they have to select that individual
whether or not he is capable of the job. that is being offered.
SELECTION PROCEDURE
Selection procedure employs several methods of collecting information about
the candidates qualifications , experience, physical and mental ability, nature and
behavior, knowledge and aptitude for judging whether a given applicant is suitable
or not for the job. Therefore the selection procedure is not a single act but is
essentially a series of methods or stages by which different types of information can
be secured through various selection techniques. At each step facts may come to
light, which are useful for comparison with the job requirement and employee
specifications54
IN DETAIL EXPLANATION
(A) JOB ANALYSISJob analysis is the basis for selecting the right candidates. Every organization should
finalize the job analysis, job description, job specification and employee specifications
before proceeding to the next step of selection essentially a series of methods or
stages by which different types of information can be secured through various
selection techniques. At each step facts may Come to light, which are useful for
comparison with the job requirement and employee specifications.
(B) HUMAN RESOURCE PLANEvery company plans for the required number of and kind of employees for a
future date. This is the basis for recruitment function.
(c) RECRUITMENTRecruitment refers to the process of searching for prospective employees and
stimulating them to apply for jobs in an organization. It is the basis for the
remaining technologies of the screening the candidates in order to select the
appropriate candidates for the jobs
.
(D) DEVELOPMENT OF BASES FOR SELECTIONThe company has to select the appropriate candidates from the pool of applicants.
The company develops or borrows the appropriate bases/techniques for screening
the candidates in order to select the appropriate candidates for the jobs.
(E) APPLICATION FORM:Application form is also known as application blank. The techniques of application
blank are traditional and widely accepted for securing information from the
prospective candidates. It can also be used as a device to screen the candidates at
the preliminary level. Many companies formulate their own style of application forms
55
depending upon the requirement of information based on the size of the
company, nature of business activities, type and level of the job etc. Information is
generally required on the following items in the application forms:
1. Personal background
2. Educational qualifications
3. Work experience
4. Salary (drawing and expecting)
5. Personal attainments including likes and dislikes
6. References
(F) WRITTEN EXAMINATION:Organizations have to conduct written examination for the qualified candidates after
they are screened on the basis of the application blanks so as to measure the
candidate ability in arithmetical calculations, to know the candidate attitude towards
the job, to measure the candidate s aptitude, reasoning, knowledge in various
disciplines, general knowledge and English language.
(G) PRELIMINARY INTERVIEW:
The preliminary interview is to solicit necessary information from the prospective
applications and to assess the applicant suitability to the job. An assistant in
the personnel department may conduct this preliminary interview. The information
thus provided by the candidate may be related to the job or personal specifications
regarding education, experience, salary expectations, attitude towards job, age,
physical appearance and other requirements etc. Thus preliminary interview is
useful as a process of eliminating the undesirable and unsuitable candidates. If a
candidate satisfies the job requirements regarding most of the areas, he may be
selected for further process. Preliminary interviews are short and known as stand up
interviews or sizing up of the applicants or screening interviews. However, certain
required amount of care is to be taken to ensure that the desirable workers are
not eliminated. This interview is also useful to provide the basic information about
the company to the candidate.
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(H) BUSINESS GAMES:Business games are widely used as a selection technique for selecting
management trainees, executive trainees and managerial personnel at junior, middle
and top management positions. Business games help to evaluate the applicants
in the areas of decision-making, identifying the potentialities, handling the situations,
problem- solving skills, human relations skills etc. participants are placed in a
hypothetical work situation and are required to play the role situations in the game.
The hypothesis is that the most successful candidate in the game will be most
successful one on the job
.
(I) GROUP DISCUSSION is used in order to secure further information regarding
the suitability of the candidate for the job. Group discussion is a
method where groups of the successful applicants are brought around a conference
table and are asked to discuss either a case study or subject matter. The candidates
in the group are required to analyze, discuss, find alternative solutions and select the
sound solution. A selection panel thenobserves the candidates in the areas of
initiating the discussion, explaining the problem, soliciting unrevealing information
based on the given information and using common sense, keenly observing the
discussion of others, clarifying controversial issues, influencing others, speaking
effectively, concealing and mediating arguments among the participants and
summarizing or concluding aptly.
The selection panel, based on its observation, judges the candidate skill and ability
and ranks them according to their merit. In some cases, the selection panel may also
ask the candidates to write the summary of the group discussion in order to know the
candidate writing ability as well.
Types of test:Tests are classified into six classes, each class is again divided into different types of
tests. They are:
57
APTITUDE TESTS:
These tests measure whether an individual has the capacity or latent ability to learn a
given job if given adequate training. Aptitudes can be divided into general and mental
ability or intelligence and specific aptitudes such as mechanical, clerical, manipulative
capacity etc. General aptitude test is of two types namely intelligence quotient (IQ)
and emotional quotient (EQ).
(1) Skill tests:
These tests measure the candidate ability to do a job perfectly and intelligently.
These tests are useful to select the candidates to perform artistic jobs, product
design, design of tools, machinery etc. The candidates can be selected for assembly
work, testing and inspection also.
(2) Mechanical aptitude tests:
These tests measure the capabilities of spatial visualization, perceptual speed and
knowledge of mechanical matter. These tests are useful for selecting apprentices,
skilled, mechanical employees, technicians etc.
(3) Psychomotor tests:These tests measure abilities like manual dexterity, motor ability and eye hand
coordination of candidates. These tests are useful to select semi-skilled workers and
workers for repetitive operations like packing and watch assembly.
(4) Clerical aptitude tests:These types of tests measure specific capacities involved in office work. Items of this
tests include spelling, computation, comprehension, copying, word measuring etc.
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ACHIEVEMENT TESTS:
These tests are conducted when applicants claim to know something as these tests
are concerned with what one has accomplished. These tests are more useful to
measure the value of a specific achievement when an organization wishes to employ
experienced candidates. These tests are classified into (a) job knowledge test and (b)
work sample test. Thus, the candidate achievement in his career is tested regarding
his knowledge about the job and actual work experience.
SITUATIONAL TESTS :
This test evaluates a candidate in a similar real life situation. In this test the
candidate is asked either to cope with the situation or solve critical situations of the
job.
(1) Group discussion:This test is administered through the group discussion approach to solve a problem
under which candidates are observed in the areas of initiating, lead ing, proposing
valuable ideas, conciliating skills, oral communicating skills, coordinating and
concluding skills.
(2) In basket:Situational test is administered through in basket method. The candidate in this test is
supplied with actual letters, telephone and telegraphic message, reports and
requirements by various officers of the organization, adequate information about the
job and organization. The candidate is asked to take decisions on various items based
on the in basket information regarding requirements in the memoranda.
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INTEREST TESTS:These tests are inventories of the likes and dislikes of candidates in relation to work,
job, occupations, hobbies and recreational activities. The purpose of this test is to find
out whether a candidate is interested or disinterested in the job for which he is a
candidate and to find out in which area of the job the candidate is interested. The
assumption of this test is that there is a high correlation between the interest of a
candidate in a job and job success. Interest inventories are less faked and they may
not fluctuate after the age of 30
.
PERSONALITY TESTS:These tests prove deeply to discover clues to an individual value system, his
emotional reactions and maturity and characteristic mood. They are expressed in
such traits like selfconfidence, tact, distrust, initiative, emotional control, optimism,
decisiveness, sociability,conformity, objectivity, patience, fear, judgment dominance or
submission, impulsiveness, sympathy, integrity, stability and self-confidence.
(1) Objective tests: Most personality tests are objective tests as they are suitable for
group testing and can be scored objectively.
(2) Projective tests: Candidates are asked to project their own interpretation of
certain standard stimulus basing on ambiguous pictures, figures etc. under these
tests. Personality tests have disadvantages in the sense that sophisticated
candidates can fake them and most candidates give socially acceptable answers.
Further, personality inventories may not successfully predict job success. A number of
corrective measures tried as personality inventories are widely subject to faking. They
are:
1. Forced choice of Edward personnel preference schedule.
2 .Gordon personal profile.
3. The Minnesota Multi-phase Inventory offers different methods
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MULTI-DIMENSIONAL TESTING:
However, the need for multi-skills is being felt be most of the companies consequent
upon globalization, competitiveness and the consequent customer centered
strategies. Organization have to develop multidimensional testing in order to find
out whether the candidates possess a variety of skills or not, candidate ability to
integrate the multi-skills and potentiality to apply them based on situational and
functional requirement.
INTERVIEW
Final interview follows after tests. This is the most essential step in the process of
selection. In this step the interviewer matches the information obtained about the
candidate through various means to the job requirements and to the information
obtained through his own observation during the interview. The different types of
interviews are:
PRELIMINARY INTERVIEW:
(1) Informal interview: This is the interview, which can be conducted at any place
by the person to secure the basic and non-job related information. The interaction
between the candidate and the personnel manager when the former meets the latter
to enquire about the vacancies or additional particulars in connection with the
employment advertisement is an example of the informal interview.
(2) Unstructured interview:In this interview, the candidate is given the freedom to tell about himself by revealing
his knowledge on various items/areas, his background, expectations, interest etc.
Similarly, the interviewer also provides information on various items required by the
candidate.
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DECISION-MAKING INTERVIEW:
After the experts including the line managers of the organization in the core areas of
the job examine the candidates, the head of the department/section concerned
interviews the candidates once again, mostly through informal discussion. The
interviewer examines the interest of the candidate in the job, organization Reaction
adaptability to the working complaining, promotional
opportunities, work adjustment and allotment etc. The personnel manger also
interviews the candidates with a view to find out his reaction/acceptance regarding
salary, allowances, benefits, promotions, opportunities etc. The head of the
department and the personnel manager exchange the view and then they jointly
inform their decision to the chairman of the interview board, which finally makes the
decision about the candidate s performance and their ranks in the interview. Most of
the organizations have realized that employee s positive attitude matters much rather
than employee s skill and knowledge. Employees with positive attitude contribute
much to the organization.Hence, interviewers look for the candidates with the right
attitude while making final decision.
(J) MEDICAL EXAMINATION:Certain jobs require certain physical qualities like clear vision, perfect hearing unusual
stamina, tolerance of hardworking conditions, clear tone etc. Medical examination
reveals whether or not a candidate possesses these qualities. Medical examination
can give the following information:
1. Whether the applicant is medically suited for the specific job
2. Whether the applicant has health problems or psychologica attitudes like
ly to interfere with work efficiency or future attendance
3. The offer. Whether the applicant suffers from bad health which should be
corrected before he can work satisfactorily
4.It reveals the applicant physical measurements
5. It is used to check the special senses of the candidates.
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(K) REFERENCE CHECKS:
After completion of the final interview and medical examination, the personnel
department will engage in checking references. Candidates are required to give the
names of references in their application forms. These references may be from the
individuals who are familiar with the candidates academic achievement or form the
applicant s previous employer, who is well versed with the applicant job
performance, and sometimes from coworkers. Incase the reference check is from
the previous employer; information for the following areas may be obtained. They
are job title, job description, and period of employment, pay and allowances, gross
emoluments, benefits provided, rate of absence, willingness of the previous employer
to employ the candidate again and soon Further, information regarding candidate s
regularity at work, character, progress etc. can be obtained. Often a telephone call
is much quicker. The method of mail provides detailed information about the
candidate performance, character and behavior.
However, a personal visit is superior to the mail and telephone methods and is used
where it is highly essential to get the detailed, actual information, which can also be
secured by observation. Reference checks are taken as a matter of routine and
treated casually or omitted entirely in many organizations. But a good reference check
used sincerely will fetch useful and reliable information to the organization.
(L) FINAL DECISION BY THE LINE MANAGER:The line manager concerned has to make the final decision whether to select or reject
a candidate after soliciting the required information through techniques discussed
earlier. The line manager has to take much care in taking the final decision not only
because of economic implications but also because of behavioral and social
implications. A careless decision of rejecting would impair the morale of the people
and they would suspect the selection procedure and the basis of selection of this
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organization. A true understanding between line managers and personnel
managers should be established to take proper decisions.
(M) JOB OFFER:Thus, after taking the final decision, the organization has to intimate this decision to
the successful as well as unsuccessful candidates. The organization offers the job to
the successful candidates either immediately or after some time depending upon its
time schedule. The candidate after receiving job offer communicates his acceptance
to the offer or requests the company to modify the terms and conditions of
employment or rejects the offer.
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DATA ANALYSIS AND INTERPRETATION
1. How do you recruit the employees?
S.NO Particulars No.of Respondents Percentage
1. Internal 14 70
2. External 6 30Total 20 100
Interpretation: From the above table 70% of the employees are recruiting internally and 30% of the employees are recruiting externally.
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2. If external how do you recruit the employee?
S.NO Particulars No.of Respondents
Percentage
1. Through agencies 12 60
2. Through reference 4 203. Casual application 2 104 Data banks 2 10
Total 20 100
Interpretation: From the above table 60% of the employees are through agencies and 20% of the employees through reference, 10% of the employees from casual applications and 10% of the employees are recruiting data banks.
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3. How will you inform the vacancy position of the job to internal conditions?
Interpretation: from the above table 60% of the respondents responded about the information of vacancy position is through notice board, 30% said through department head and 10% said through word of mouth.
S.NO Particulars No.of Respondents Percentage
1. Through word of mouth
2 10
2. Notice board 12 603. Department
heads 6 30
Total 20 100
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4. What are the major sources for identification of candidates for recruitment?
S.NO Particulars No.of Respondents Percentage
1. Through adds 12 60
2. Internet 6 303. Consultants 2 10Total 20 100
Interpretation: From the above table we concluded that 60% fo the respondents recruited through ads and 30% fo the candidates recruited internet and 10% of the candidates recruited consultants.
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5. Who are involved in the manpower planning?
S.NO Particulars No.of Respondents Percentage
1. Department heads
4 20
2. HR department 10 503. Above two 6 30Total 20 100
Interpretation: From the above table 50% of the employee said HR department will participate in the manpower planning, 30% of the employee said both the department heads and HR department and 20% of the employees said department heads.
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6. How frequently do the companies recruit the employee?
S.NO Particulars No.of Respondents Percentage
1. Quaterly 2 10
2. Half yearly 2 103. Annually 4 204. Whenever
required 12 60
Total 20 100
Interpretation: From the above table we concluded the employees 10% quarterly, 10% half yearly, 20% annually and 60% of employee recruiting whenever required.
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7. What is your level of satisfaction regarding the present recruitmentpolicy?
Interpretation: From the above table we concluded that the present recruitment policies are 70% satisfied, and the 30% are needs improvement of the recruitment policy
8.Do you feel any improvements in the present recruitment process?
S.NO Particulars No.of Respondents Percentage
1. Satisfied 14 70
2. Need improvement
6 30
Total 20 100
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Interpretation: From the above table we concluded the improvement in the present recruitment policy to recruit 90% of yes and 10% of no above all for the improvement in the present recruitment policy
S.NO Particulars No.of Respondents Percentage
1. YES 18 90
2. NO 2 10Total 20 100
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9. Does the company deserve the campus selection?
Interpretation: From the above table 85% of the employees said ‘Yes’ about the campus selection in the organization and the remaining 15% said ‘No’
S.NO Particulars No.of Respondents Percentage
1. YES 17 85
2. NO 3 15Total 20 100
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10.Which type of interview do you follow for selecting the employees?
Interpretation: From the above table 70% of the employee said structured interviews while selecting employee and 10% of the employee said stress in the organisation.
S.NO Particulars No.of Respondents Percentage
1. Structured 18 90
2. Unstructured 0 03. Stress 2 10Total 20 100
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11.Do you face any hurdles in selection process?
Interpretation: From the above table 100% of the employees said ‘No’ about the recruiting employee in the organisation.
12. What do you think about the recruitment process in SHREE CEMENT Limited?
sS.NO Particulars No.of Respondents Percentage
1. YES 0 0
2. NO 20 100Total 20 100
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Interpretation: From the above table 70% of the employees said Good about the recruitment process, 20% of the employee ‘Excellent’ and the 10% of the employees ‘Fair’ in the organisation.
13.What factors do you most consider while selecting the employees?
S.NO Particulars No.of Respondents Percentage
1. Excellent 4 20
2. Good 14 703 Fair 2 10Total 20 100
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Interpretation: From the above table we conclude considered the selecting 25% subject, 20% of selecting willingness and 55% of selecting in suitability.
S.NO Particulars No.of Respondents Percentage
1. Subject 5 25
2. Willingness 4 203. Suitablity 11 55Total 20 100
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RECRUITMENT AND SELECTION PRACTICES AT SHREE CEMENT
Human Resource Management at SHREE CEMENT:HRM practice of SHREE CEMENT is the one among the practices followed by the large firms of India. The present chapter deals with the topic of HRM philosophy, HRM policy and the functions of HRM department, Human resource planning process after covering these aspects the chapter will be followed by the recruitment and selection practices of the organisation.
HRM Philosophy: Employees are the valuable resources of the organisation Relationship between different groups so that work is performed effectively. Eliminating waste and improper use of human resource. Human Resource Management Policy. Employees are provided with welfare activities to increase their quality and work life. Employees are provided with necessary training facility, so as to improve their skills. Then ultimately resulting in improved productivity and personnel development.
Functions of Human Resource Management Department
The HR Department looks after the following functions administration of the welfare facilities, reports, loans, advances, transfer, assignment etc. Deals with matter relating to recruitment and selection administration of HRD activities, matter relating to discipline. The Process of Human Resource Planning HRP consists of the following steps;
Analyzing the organisational plans Demand Forecasting: Forecast the overall human resource requirements in
accordance with the organizations plans. Supply forecasting obtaining the data and information about the present inventory of
Human Resource and Forecast the future changes in present Human Resource inventory
Estimating the human resource requirementsRecruitment and Selection Practices at SHREE CEMENT
SHREE CEMENT company recruitment and selection practice is similar to that of the large organisations. Through these practices the HRM department is able to meet the requirements of the organisation. Recruitment and selection process in SHREE CEMENT.
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Position or job vacancy Approval for filling the vacancy/manpower planning Notification of vacancy through advertisements/consultants or agencies Sources of Recruitment
SHREE CEMENT Recruitment Sources are Advertisements Deputation or contract Recruitment consultants. Promotions Transfer.
From these sources as organisation receives the applications for the specified requirements to fill the vacancy. Based upon the departments’ specification a job analysis process will be done by the HRD department accordingly.
On receiving the approval from MD and CEO the HRD initiates the process by advertising the local news paper and national papers depending upon the manpower recruitment or it may be referred to the recruitment consultants, for receiving the suitable applications.
Selection Process in SHREE CEMENT Interviews:
SHREE CEMENT used to recruit through interviews to security the suitable candidate since its inception by selecting the best required from those who are selected in the interviews. Written test was the first step in the selection process and follows with the personal interview. The selected candidates from the written test and the personal interview have to go through group discussion and the best in the group discussion will be selected to meet the requirement. In case the technical recruitment, practical test and selection test are conducted. The candidates who are qualified in the tests will be called for the final interview will be done by the selection committee as constituted by the HRD. HRD will take the initiative of based on the selection committee’s report. All selected candidates will be sent on offer of employment letter, with the date of joining, pay and allowances, designation and the other terms and conditions of employment in SHREE CEMENT.
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At the time of joining the candidate should produce the following documents of the HRD
Educational qualification Proof of data of Birth Experience certificate Relieving letter from the precious organisation Attestation forms for police verification Reference
Policy enquiry about the selected person is made after his interview. Medical examination is also carried out. Selection of local candidate was made particular under certain situations to meet the requirements.
The selected employees will be appointed on training for a period of one year. Based on the appraisal reports, candidates will be absorbed into the suitable grade and will be on probation period of six months. After successful completion of probation period the candidate will be confirmed subject to the appraisal report.Manpower Planning in SHREE CEMENT:
Activity based manning Badly Concept Nominee System Pool Concept Multi-skilling and Flexibility
Manpower Planning in SHREE CEMENT:Separations-
Recruitments Deaths Resignations Transfers Recruitment Promotions Transfers.
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SWOT ANALYSIS
SWOT Analaysis Is a planning tool used to understand the Strengths,
Weaknesses, Opportunities, and Threats involved in a project or in a
business. It involves specifying the objective of the business or project and
identifying the internal and external factors that are supportive or
unfavourable to achieving that objective. SWOT is often used as part of a
strategic planning process.
SWOT is an for Strengths, Weaknesses, Opportunities, Threats.
Overview Matrix:
POSITIVE/ HELPFUL
to achieving the goal
NEGATIVE/ HARMFUL
to achieving the goal
INTERNAL Originfacts/ factors of the organization
Strengths
Things that are good now, maintain them, build on them and use as leverage
Weaknesses
Things that are bad now, remedy, change or stop them.
EXTERNAL Originfacts/ factors of the environment in which the organization operates
Opportunities
Things that are good for the future, prioritize them, capture them, build on them and optimize
Threats
Things that are bad for the future, put in plans to manage them or counter them
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What Strengths and Weakness are analyzed?
The strengths and weaknesses analysis is an internal examination that focuses on
your past performance, present strategy, resources and capabilities. It is based on
an analysis of facts and assumptions about the company, including:
People (Human Resources)
o People and skills (in particular marketing, export
experience)
o Staff development
Properties (Buildings, Equipments and other facilities)
Processes (Such as quality, finance, M.I.S. etc.)
o Financial resources (debt to asset ratio and personal equity)
o Governance
o Management/ leadership
o Staff development
o Communication
Products (Publications etc.)
o Sales
o Products
o Markets
What Opportunities And Threat Examined The opportunity and threat analysis is carried out by examining external factors
in your domestic and export markets. This is usually broken down into
environmental factors and competitors, including:
Environmental Factors Demographics
Economic
Political/legal 85
Sociological
Environmental
Technology
Competitor Factors Capability
Resources
Ownership
New entrants
Market segments
Products
Prices
Promotion
Distribution
Substitute products
Suppliers customers
Product life cycle
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CONCLUSION
On the basis of above study it can be concluded that a system of
psychological appraisal can be introduced where psychologists are used
to specifically assess an individual's future potential. The appraisal
normally consists of in depth interviews, psychological tests, discussions
with supervisors and a review of other evaluations. The psychologist then
writes and evaluation of the employee's intellectual, emotional,
motivational and other work related characteristics that suggest individual
potential. This will make the potential appraisal more specific and a
reliable date source for making employee's promotion decisions and future
development.
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Recommendation & Suggestion Systematic and a common methodology should be opted for recruiting
and selecting the employees.
The steps in the process of selection should not very from employee to
employee
The system opted for remuneration should be changed
Experience and qualification should also be considered at the time of
selection
Recruitment should be made in the manner, which helps in the
development of the organisations.
Check if the right person is being placed at the right place
Induction programme should be made in time, but not too late.
The process of selection should be the same for the employees of
same designation and very according to the designations.
Job rotation should be made according to the individual’s skill and
qualification.
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QUESTIONNAIREName…………………………………………………………………Employee No. …………………., Experience…………………………..Designation……………………… Department…………………………
1. How do you recruit the employees?
a) Internal b) External
2. If external how do you recruit the employee?
a) Through agencies b) Through reference
c) Casual applications d) Data banks
3. How will you inform the vacancy position of the job to internal
conditions?
a) Through word of mouth b) Notice boards
c) Department heads
4. What are the major sources for identification of candidates for
recruitment?
a) Through ads b) Internet
c) Consultants
5. Who are involved in the manpower planning?
a) Department heads b) HR Department
c) Above two
6. How frequently do the companies recruit the employee?
a) Quarterly b) Half yearly
c) Annually d) whenever required89
7. What is your level of satisfaction regarding the present recruitment
policy?
a) Satisfied b) Needs Training
8.Do you feel any improvements in the present recruitment process?
a) Yes b) No
9.Does the company deserve the campus selection?
a) Yes b) No
10.Which type of interview do you follow for selecting the employees?
a) Structured b) Unstructured
11.Do you face any hurdles in selection process?
a) Yes b) No
12.What do you think about the recruitment process in SHREE CEMENT
Limited?
a) Excellent b) Good
c) Fair
13.What factors do you most consider while selecting the employees?
a) Subject b) Willingness
c) Suitability
14. Any Suggestions---------
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BIBLIOGRAPHY
K. Aswathappa, Human Resource and Personnel Management ,2007,Tata Mc Graw Hill Publication ,Second Edition.
Gupata C.B, Human Resource Management ,2006,Sultan Chand and Sons ,Sixth Edition.
MAGZINES:
INDIA TODAY
BUSINESS WORLD
REFERENCES WEBLIOGRAPHYThank you
www.shreecementltd.com www.ibef.org www.marketresearch.com www.indianinfoline.com www.busineessconnect.com www.indiancementindustry.com
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