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INTERNSHIP REPORT
MBA 6 th
DEDICATIONS
Dedication is a devotion to which we love, who benefactors are, who pray for us and who
made us capable of doing all these things with full devotion and these are two
personalities which are our parents and our teachers.
I dedicate my work & efforts first of all to Almighty Allah and His beloved Prophet
(P.B.U.H) and my Parents and teachers with dedication, love and gratitude without whom
caring support it would not have been possible
ACKNOWLEDGEMENT
Praise to Almighty Allah, the Omnipresent, the Omnipotent, Who bestowed upon me the
potentially and ability to accomplish this work. No sequence of works can express my
sincere gratitude to our respected teachers of MBA department without their valuable
guidance, rich experiences, helpful advice, useful suggestions and constructive criticism
and comments. I could not have been able to complete this Internship Report. I have
honor to express my heart-full gratitude to the every executive and staff members of
SERVIS GROUP OF INDUSTRIES GUJRAT, who kindly gave them acceptance to the
topic of my Internship Report along with many useful suggestions which encouraged me
to complete my work. Thanks for all those who extend their cooperation for conducting
the work of internship report.
PREFACE
It is the requirement of all Master Degree programsstudents to undergo the practical
work in shape of internship. It not only helps to get an exposure to the practical world and
to get familiarized with the practices followed by different organizations while in pursuit
of their objectives but also one can learn to face the professional challenges that are
dramatically different from the educational world. This period called the learning period
, if spent properly and sincerely, enables the students to be more confident, more
knowledgeable, and more responsible and, above all, more committed to their work. By
the Grace of Almighty Allah, I am able to bring out Training report on"Service
Industries Ltd. G.T Road, Gujrat"
I hope that It will assist everybody who wants to know about Service Industries Ltd.
G.T Road, Gujratat its best level.
This report is the result of help, which I received from the respected staff of Service, who
appreciated my efforts and informed me about my weaknesses. I worked in this leading
organization and this training report enabled me to draw a line of distinction between
theory and practical. I learned that the procedure in theory and practical is same but we
cannot learn theory without practice and practice.
In preparing this report, I have put all of my best efforts and have tried hard to
give maximum knowledge. Despite of my all the coherent efforts, I do believe
that there will be a room for improvement.
ECECUTIVE SUMMARAY
RAG Division.
The factory has highly sophisticated test laboratory manned by qualified and trained
personnel. Other than the MCTT & RAG Div own well-equipped laboratories. It is here
TYRE DIVISION
COMPANY INFORMATION
BOARD OF DIRECTORS
(Chairman)
Mr. ShahidHussain
(Chief Executive)
ADVISOR
Ch. Ahmed Saeed
COMPANY SECTAREY
Mr. Sultan Anwar
AUDIT COMMITTEE
Mr. Shahid H. Kardar
(Chairman)
(Member)
Mr. AnisWahabZuberi
(Member)
(Member)
BANKERS
Habib Bank Limited
United Bank Limited
AUDITORS
S.M Masood& Company
Charted Accountants
LEGAL ADVISOR
Bokhari, Aziz &karim
2-A Block-G, Gulberg-||, Lahore
SHARE REGISTRAR
HameedMajeed Associates (Pvt.) Ltd
IST Floor, H.M House.7- Bank Square
The Mall, Lahore
FACTORIES
G.T Road, Gujrat.
Muridke-Sheikupura Road, Muridke
VISION STATEMENT
MISSION STATEMENT
To be result oriented and profitable company by consistently improving market share,
quality diversity, presentation, reliability and customer acceptance.
To emerge as a growth oriented concern ensuring optimum return and value addition to
its shareholders.
To ensure cost consciousness in decision making and operation without compromising
the commitment to quality.
To create an efficient resource management and conducive business environment.
Evolving an effective leadership by creating a highly professional and motivated
management team fully equipped to meet any challenge.
To keep abreast with modern technology and designs to optimize production and
enhance brand image to attain international recognition for the companys products.
To set up highly ethical business standards and be a good corporate citizen, contributing
toward the development of the national economy and assisting charitable causes.
To adopt appropriate safety rules and environment friendly policies.
continuous improvement.
No compromise on Quality
concern firm, Service Industries manufacture the Leather, Canvas, Tyres and Tubes in
Pakistan. Followings firms are include in Service Group;
General Manager
Ghulam Muhammad
Manager
Procurement
Manager
HR
Chief Security& Canteen
ChiefSoul
Technical
Manager
Collections.
M.C.T.T
C.T.T
Planning Manager
LSF
Production Manager
P.U
Planning Manager
Production
Manager
Production
Manager
INTRODUCTION OF DEPARTMENTS
Departmentalization is the clustering of individuals into units and units into departments
and larger units in order to facilitate achieving organizational goals. Organizational goals
are achieved more efficiently by the concerted efforts of different departments and there
functions. The functional structure groups jobs into units based upon similarity of
expertise, skills, and work activities.
Human Resource
Accounts
I.T Supporting
Industrial Relation
Security
Canteen
Costing
Material Management
Industrial Engineering
Engineering Supporting
Technical Department
Quality Assurance
Production department
IT SUPPORTING
Basically there is numerous motivation of implementing management information
system. This system should be capable to provide the necessary data for decision making
immediately to top management, managers and front line managers.
The propose of system is as follow,
Data Storage
Cost Reduction
I.T department is working as the system support department for all the other departments
so that they can perform their activities efficiently and efficiently. I.T department of the
S.I.L Gujrat is responsible to manage all the activities relating to computer systems and
database.
The persons are appointed in the department are I.T literate. They generate different
reports in database on the requests of managers. This department holds the strength of six
employees which includes two programmers, one assistant, and hardware supervisors
headed by a manger and an assistant manager.
INDUSTRIAL RELATION
This department maintains the record of workers like H.R. In the Service industries Ltd.
Gujrat record of staff is prepare and maintains by H.R and workers record is maintain by
I.R. Moreover departments responsibilities are to arrange the meetings with other
companies if there is need for any visit by the management. This department arranges the
classes of newly appointed work in the training school.
SECURITY
In the S.I.L Gujrat the security department is responsible to keep the law and order inside
the factory. They are responsible to handle any misconduct and to keep the eye on the
workers to stop theft.
CANTEEN
Canteen or mess is meeting the food requirements of its more than 2000 employees at
one time. The rate for food is fixed by the management and it is very economical there
are 2 sections for canteen, one is responsible for all the activities involve in making and
distributed food and other is responsible for the purchasing of required edible things
along with grocery.
There is a management committee for the smooth running of canteen matter, headed by
factory managers. The other members of the canteen committee are head of different
departments.
The canteen is divided in to three portions: One portion is reserved for worker
Other is reserved for non-managerial staff
One is for the managerial staff.
COSTING
Costing department performing very important function it allocate the materials and their
quantities to be required for the bulk production and prepare the cost sheet of each article.
Cost sheet is very important document that comprises very important detail for top
management. It includes the value of material, overheads, percentage of gross profit, net
profit, and contribution margin of one unit. It is divided in to two sections one is called
costing shoe division and other costing Tyre division.
MATERIAL MANAGEMNT
Material management perform vital role in the organization this department made of all
type of purchases includes domestic and foreign the responsibility of this department.
Department is divided in two segment local and foreign purchases separately.
Local department further divided in to 6 sections that include:
Leather
Packing
Chemical
Synthetic
Grinderies
Technical equipments.
PROCUREMENT DEPARTMENT
Procurement department is the back bone of Service Industries limited because at each
level of production raw material is needed and there are so many items involved of
different and colours. Procurement department raise the purchase order on the basis of
bill of material that receive from costing department and made all adjustment of material
to avoid dead stock. Department establish and maintain relations with suppliers and
ensure them to delivery within the lead time. Lead time for local purchase is 40 days and
for import is 3-months.
SCOPE
Purchase, Planning and Quality Assurance.
INDUSTRIAL ENGINEERING
It is new department exist recently in service Gujrat. Purpose to create this department is
to measure and improve the output and operational efficiency of the production unit. To
check the discrepancies in production hall i.e. in plant or worker output if any found then
try to remove it. So that productions not suffer and product can be produce with their full
capacity. Three persons are employed for this department in which one manager is
leading other two.
ENGINEERING SUPPORT
It is supporting department chief engineer heads this department with number of engineer
and technicians. This department supporting in term of:
TECHNICAL SUPPORTING
Chief Technical Manager is the head of this department. All material that includes
process of chemicals is control by this department. It includes Raw Rubber processing,
Main Laboratories and P.V.C Molding and pressing.
There are two laboratories at SIL Gujrat one for shoe division called main laboratory
other for tyre division both these laboratories are being headed by the chief technical
manager and there are number of qualified technician are sporting him. The laboratory
PRODUCTION DEPARTMENT
In manufacturing concern the largest and the far most important department in any
factory is always is production department. Production department is divided according
to their functions and operation wise they are in align in such a way that output of the one
is the input of the other. In the service industries Footwear section main production
department is Leather Shoe Factory (LSF).
Factory manager is leading this department with his team. Further this department
comprises severaldepartments and sub-departments. In Leather shoe factory main
departments are Lasting and P.U. in lasting departments assemblies lines produce sandals,
chapples and children shoes while in P.U department automatic direct injections machines
are used and it made close supports shoes. More then 500 persons are employed in the
L.S.F. other departments are includes in LSF are:
PLANNING DEPARTMENT
Planning department also controlled by factory manager. Planning department is
responsible to checking out projections, capacities and routing of orders. Planning
department perform very effective work in the factory without planning it is not possible
to complete the job.
MARKETING DEPARTMENT
Marketing Department plays very effective role all the orders are being processed in the
factory premises are receive form marketing department. Marketing department of
Service industries is performing following functions:
Developing the marketing mix i.e., product, price, place and promotion.
Deliver the right product to right place to right people on right time.
Where as in perspective of export the export department works on it they have their agent
in the outside the countries they charge their commission and perform their work for
service.
Hierarchy of each
WORK DONE BY ME
ACCOUNTS
MANAGER
DEPUTY ACCOUNTS
MANGER
ASSISTNANT MANGER
ACCOUNTS
ASSISTANT
ACCOUNT
MANAGERS
ASSISTANT
ACCOUNT
MANAGERS
ASSISTANT
ACCOUNT
MANAGERS
ASSISTANT
ACCOUNT
MANAGERS
Wages,
Salaries,
Provident Fund,
Budgets,
Bill Verification,
Payments A/P,
Receipts A/R,
Pensions,
Loans Day-Today Expenses
Accounts Management.
The salaries to the workers are made and distributed after every 15 days, while salaries to
the staff if are below 10,000 are distributed monthly at the factory. If the amount is more
than the 10,000 then it is credited to the employees account. The pay to the workers is
also being made twice a month. The persons are performing their work at department are
very experienced.
The competitive priority of Accounts & Finance Deptt.is to implement the Oracle ERP
System with an investment of Rs. 50 million. Its functional module is fully implemented
and achieving targets whereas payroll and supply chain module is in pipeline.
The accounting procedures employed in a company reveal the overall condition of the
company management. Accounting in the simple words is the counting of incomings and
outgoings of an organization. For this purpose all the companies hold record of every
transaction in their books through the accounts.
The books employed for this purpose are called ledgers. Service Industries Ltd has
installed modern accounting procedures. The head office receives vouchers regarding the
happenings at their factories daily. Service Industries Ltd maintains the following
statements or vouchers in its accounting procedures at the factory.
Voucher System:
A piece of paper that may be exchanged for goods or services.
For an unqualified audit report the essential document is Voucher. Every transaction is
recorded through Vouchers. There are several kinds of Vouchers for example cash
payment voucher, journal voucher, bank receipt voucher and bank payment voucher.
1. Cash payment voucher:
A voucher is made when any cash transaction taken place. For example we purchase any
supply and made payment through cash then we record it by cash payment voucher.
2. Journal voucher:
Sources of receipts:
The following are the sources of receipts in SIL Gujrat;
1. Recovery from C.T.T & MC TT.
2. Recovery from sales of shoes/Tyre tubes through fair price shop.
3. Recovery from SSC on account of shoes sold on direct basis.
4. Sales proceeds of left over raw material.
5. Retail stores sales of shoes.
Payments:
The following are the payments in SIL Gujrat;
Wages to workers.
2. Salaries to staff.
3.
Fringe benefits.
4.
5.
Government Dues.
Custom Dues
2.
Sales tax.
The following payments are made to Suppliers;
Authorized Signatories:
The persons on whose signature bearing documents/ cheques are considered valid with
reference to making payments are drawing cash from accounts office. These are:
Seat Vacccant
Mr. MushtaqBaigMirza
Manger Accounts
Mr. Habib-ul-Rehman
Manager Costing-TD
HRM &
ADMIN
MANAGER
CSO
ASSISTAN
T
SECURITY
OFFICER
IR
MANAGER
ASSISTANT
IR
MANAGER
CLERK
DEPTUY
MANAGER
ADMIN
OFFICER
TIME
KEEPER
LABOUR
OFFICER
ASSISTANT
MANGER
The HR department is responsible to provide the man power to the all other departments.
This department receives demand of the employees from the department heads where
needs the employees. Then H.R officials evaluate the job with the head of department and
after approval by the G.M the H.R assistant manager appoint the person.
There is much specified and organized way to hire the person that includes:
Advertising
Screening
Testing
Interviewing the candidate
Internship of the students is also arranged by this department along with the visits of the
SWOT ANALYSIS
STRENGTHS
SIL is very old and larger organization. It has much strength some of them are as follows:
Old management & workersis one of the key to success. The management knows enough
the organizational systems. These all are qualified and competent they know how to run
the organization. This management and staff are all committed to the quality slogan of the
SERVIS GROUP
Strong group:-
Strong group can easily support all of its organization. SERVIS GROUP also influence
SIL shares market value, image and market share. It counters financial problem for
working capital and investment for further developments.
Owned go downs SIL has large number of go downs all over the country. This creates
efficiency in its logistic operation.
Forward integration:-
Old brand:-
Old brandname has enabled the group further tap other segments of market. Customers
are confident at the quality foot wear products and tyre and tube of SERVICE
INDUSTRIES LIMITED.
Servis has been established since 1941. It has it has strong relationship with its customer
and has very large market share as compared to its competitors. As service supply
customer with quality and reliable product which gain customer confidence. Now the
current position of SIL shows that Servis has beaten it competitors out of market and
captured their market share. Tyre division has strong relationship from very long time. All
motor bike manufacturer and Assembler use Servistyres and tubes. All major customers
are Servis industries client.
WEAKNESSES
There are many weaknesses in any of the organizational system along with its strengths.
Following are some weaknesses
Centralization:-
Centralization prevents the staff to work free and local management is not in position to
take quick decision according to local requirements. On the other hand it create
Head office control the SIL accounts department. The staff is always seen disturbed due
H.O interruption. And not so much sure about there real job description staff consider the
job as task base jobs. It means staff has to fulfill the task what is required by H.O in terms
of any type of reconciliation, report about customer suppliers and any financial report.
Salary package
Salary packages for middle level staff are not so hand some to motivate them so that they
work with full devotion. Middle level staff salary package should be adjusted for monthly
performance allowance. Workers wages should also be adjusted for the quality of work.
As this will further make positive impact on other workers and compel them to work and
produce quality output.
Lack of communication
There is communication barrier between the high management and lower level staff. This
cause lower quality and efficiency in the staff work. This is really Importance to educate
the staff and worker for quality of work.
OPPORTUNITIES
Product development :Service industries Limited group structure allow it to easily market new products to
exiting customer as well as it can bring innovation in it exiting products. It has capacity
to introduce new product articles so that it can increase profitability. As its exiting
infrastructure has capacity and flexibility to extend it product and segment portfolio.
Forward integration
Backward integration
Horizontal diversification
Conglomerate diversification
Forward integration:Currently SIL is manufacturing Foot wear products and tyres& tubes in Gujratplant.If it
adopt forward integration than it should invest in retail business for it products. Current
SILs associate company has its own retail shops for foot wear products. Company has an
opportunity to invest for retail business of tyre and tubes.
Uncertainty of supplies
Quality of supplies
No control over prices in case of suppliers monopoly
Middle man margin of profit
This situation can be countered backward integration. SIL can takeover it major supplier
to remove all types of uncertainties. For example NATIONAL PETRO CARBON LTD is
major supplier of raw material for tyre division products. SIL has to agree at there terms
due to there monopoly. The uncertainty related to these types of parties can be removed
by acquiring these of companies.
Horizontal diversification:-
Conglomerate diversification:-
THREATS
New players enter the market this mean that as time passes new investors come in
footwear sector and tyre tube manufacturing business. This causes increase in
competitive rivalry. Price war, increase in quality expectation by customer increased
Uncertain Govt policies:Security energy and financial problem Govt policies has no certain direction and policies
about how support businesses to sustain in the current highly competitive environment.
Heavy taxes &Govt levies:Government of Pakistan has not taken broader steps for development of business.
Recently Govt increases sales tax from 16% to 17% SED 1% is already applicable. This
increase in taxes discourages growth in sales.
On the other hand import duties increased the cost of imported goods. No relaxation has
been given to investors in this financial year.
High Inflation & Interest rate:High inflation rate cause increase in cost of production, high depreciation cost hence
lower profitability.
Interest rate rises causes high finance cost as SIL has many leased assets which cause
mostly power generator.
Competitor policies:Competitor policiescan also influence the organization as it is possible that it they
decrease their product sale price so that SIL might have to turn around for better customer
response. SIL should always be ready itself to adjust its policies according to the
competitor action. This would avoid erosion of market share of the SERVICE
INDUSTRIES LIMITED.
CONCLUSION
Service industries (LTD). is in a great position as a leader in the market to earn
profits. But ignoring the aspect that china has entered in the market and fastly
capturing the market as it has captured the word market. So local footwear
industry needs to be aware and conscious about the technologies the china is
using.
An other fact that I have observed by studying the annual reports of SIL that their
profit are increasing due to increase in prices not by increase in the units sold, it is
alarming situation because it would not be possible in the future as when china
will have made stron position in the market in next 10 years.
They are also doing business in the tyre tube industry. Its good because this sector
has a great potential and they can make great profits.
At the end I would suggest that they should adopt cost effective measures and try
to increase their unit sales because of competition.
RECOMMENDATIONS
The management is ignoring the Middle East market it has the chance to become
multinational due to shift in politics in Middle East.
Expanding the companys product line to meet a broader range of customers
needs the management is ignoring the segment that is design and extra quality
conscious like not introducing leather shoe in the local market.
Using the internet and E-commerce technology to drastically cut costs the
management is reluctant to consider roll of information technology factor in
reducing cost.
Acquisition of rival firms or companies. Bata and there are many others emerging
footwear stores in local market the management should use acquisition and
merger to run its plants with full swing to gain economy of scale.
Alliance or joint ventures that expand the firms market coverage or boost its
competitive capability.
The management should use these tools to gain exposure and experience.
For the purpose of different important concepts and terms, I use the following books as
references:
Accounting by SohailAfzal ,M.Arif
Accounting By Mukhar G AndZubari
Fundamental of Financial Management by James C. Van Horns
I concert the following further material:
Annual Financial Report of Service industries Ltd.
2011
2010
2009
2008
THE END