ASHA Project

PROJECT AT A GLANCE
OBJECTIVE OF THE STUDY

The main objective of this study is to gain practical significance of management
theories and what extent it has been successfully implemented in the organization
Getting basic understanding regarding company
Studying finance activities
Various techniques used by the company for Business activities
METHODOLOGY
In order to accomplish the objective following are the ways by which the data
information is collected:-
PRIMARY METHOD
Day to day operation of the company.

Interviewing the management staff
By interacting with the management staffs of accounts and finance department
SECONDARY METHOD
Facts and figures made available by the company
Referring different books
Documents &figures made available by the staff members
LIMITATIONS
Time period for training is short to go into the depth to understand and analyze all
the aspects
Sap is not user friendly it is difficult to understand
Due to security reasons they would not furnish much detail to me which I needed in
the study.
INDIAN PETROCHEMICALS COOPERATION LIMITED
TEXTILES INDUSTRY
The Indian Textiles Industry has an overwhelming presence in the economic life of the
country. Apart from providing one of the basic necessities of life, the textiles industry
also plays a pivotal role through its contribution to industrial output, employment
generation, and the export earnings of the country. Currently, it contributes about 14
percent to industrial production, 4 percent to the GDP, and 17 percent to the countrys
export earnings. It provides direct employment to about 35 million people, which
includes a substantial number of SC/ST, and women. The textiles sector is the second
largest provider of employment after agriculture. Thus, the growth and all round
development of this sector has a direct bearing on the improvement of the economy of
the country.
Textile Industry is providing one of the most basic needs of people and it holds
importance by maintaining sustained growth for improving quality of life. It has a unique
position as a self-reliant industry, from the production of raw materials to the delivery of
finished products, with substantial value-addition at each stage of processing; it gives a
major contribution to the country's economy.
Indias cotton textile industry has a high export potential. Cost competitiveness is driving
the penetration of Indian basic yarns and grey fabrics in international commodity
markets. Small and flexible batches of apparels can be manufactured in India and can
provide a larger variety of casual wear and leisure garments at significantly lower costs.
The government will encourage the establishment of world-class integrated textile
complexes and processing units. A scheme for setting up integrated apparel parks has
been initiated. This will enable the ready-made garment industry to set up modern units
with excellent infrastructure. Rapid implementation of the Textile Upgradation Fund
Scheme aimed at providing an impetus to the modernization of textile and jute
industries is a priority with the government.
India has natural advantages which can be capitalized on strong raw material base cotton, man-made fibres, jute, silk; large production capacity (spinning - 21% of world
capacity and weaving - 33% of world capacity but of low technology); vast pool of skilled
manpower; entrepreneurship; flexibility in production process; and long experience with
US/EU (European Union). At the same time, there are constraints relating to fragmented
industry, constraints of processing, quality of cotton, concerns over power cost, labour
reforms and other infrastructural constraints and bottlenecks.
EXPORTS OF TEXTILES
The textile products continue to play an important role in total export basket of the
country.
During the year 2005-06, the share of textile exports including handicrafts, jute, and coir
in Indias total exports was 16.63 per cent. India's textile exports have registered strong
growth in the post quota period and the textile exports grew from US$ 14 billion in 200405 to US$ 17 billion in 2005-06., recording a growth of 21.77 per cent. Therefore, the
government has fixed a higher target of US$ 19.73 billion for the year 2006-07.
The growth trends have continued in 2006-07 the textile exports have shown a growth
of 15.59 per cent in dollar terms and 20.54 per cent in rupee terms over the exports
during the corresponding period in the preceding year.
INTRODUCTION
INDIAN PETROCHEMICALS CORPORATION PVT LTD (IPCL) is located in a beautiful
sprawling campus of about 115 acres at village Kharadpada,Silvassa in the Union
Territory of Dadra & Nagar Haveli. Nearest
railway station is Vapi and airport is
Mumbai. IPCL is the largest company in the world and largest in Asia engaged in the
business of Texturing partially oriented yarn (POY) to produce polyester textured yarn
(PTY) in 1994. It has been now merged in IPCL. The name of SIPL (SILVASSA
INDUSTRIES PRIVATE LIMITED) has been now changed to IPCL Silvassa Complex
from 27th Sep 2006. IPCL is spread over 131 acres of land and has capital layout of Rs
272 crore and annual turnover is Rs 1000 crores. IPCL has a state of the art plant with a
human force of around 2042 The company has total regular 1066 employee, which is
further categorized into supervisory (211) and non-supervisory (836). There are 995
contract labours. It has capital base of Rs. 650 crores. The company is rated as one of
the leading professionally managed, well-governed companies with highly motivated
qualified personnel. All functional areas are integrated with advanced application.
It is financially managed and advised by Reliance Industries Limited (RIL). The
Board of Directors of Indian Petrochemicals Corporation Limited (IPCL) have approved
the merger of Apollo Fibres Ltd (AFL), Central India Polyester Ltd (CIPL), India
Polyfibres Ltd (IPL), Orissa Polyfibres Ltd (OPL), Recron Synthetics Ltd (RSL) and
Silvassa Industries Pvt Ltd (SIPL) with IPCL
INDIAN PETROCHEMICALS CORPORATION PVT LTD (IPCL) is the largest of its kind
in Asia engaged in texturing of Partially Oriented Yarn (POY) of polyester in a wide
range of product mix e.g., Crimped, textured, Roto- Micro & super set yarn in various
deniers. It is the 1st largest company of its kind in the world with 158 machines backing
off a Korean Company.
SALIENT FEATURES OF IPCL

It has online Tension monitoring system (OLT) for continous monitoring of textured
yarn quality.
It is installed with latest state-of-art texturing machines and ultra modern robot
controlled Auto Packing System (APS), technically advised by CAMEL ROBOT, Italy,
and all under one roof. It has recently installed SAMURAGHI Packing system of Italy
for Jumbo export bulk packing.
It has a developed system known as BOBIN TRACKING SYSTEM (BTS) for online
monitoring the finished product. It dose the online monitoring from bobbin to trolley
and finally to pallet.
In IPCL customer satisfaction is of prime concern. Based on routine communication
with customer survey the customer needs and expectation is determined and
documented. All the data obtained from customers are processed and converted into
customer requirements are fulfilled for enhancing customer satisfaction.
Meaningful automation & 100% computerized front
All machine are modified to inverter operations
Measured length-doffing system incorporated
Fully equipped laboratory for R&D and QA
Full fledged R&D team of highly qualified engineers with 05 pilot machines
TQM & QC activities in force
Six Sigma is under implementation
Eco-friendly operation
Cash project under implementation
Connected with SAP and LEGACY system
Fully equipped laboratory to test essential yarn characteristics
Barcode system for easy identification of material
Research and Development cell for developing new products
ORGANIZATION CHART
CHAIRMAN
WHOLE TIME DIRECTOR
CHIEF PURCHASE
CHIEF SALES
SITE CHIEF
DGM PURCHASE
AVP OPERATIONS
AVP(P&A)
HRD ADM.
CMO
SR. MGR
(P&A)
SR. MGR
(T&D)
DGM YO1
SR. MGR (F&A)
DGM
PACKING
GM(COMM)
WAREHOUSE
PROJECTS CIVILs
GM
TEXTURISIN
G)
DGMYO2
DGM
POWER
DGM
STORES
DGM
QUALITY
R&D
DGM
JOB
WORK
DGM
LOGISTICS
DGM
PLANTMNT
.&UTILITY
SR.MGR
WARE
HOUSE
DGM
SYSTEMS
OUR LOGO
CODE OF CONDUCT
Code of ethics and business responsibility
Be prompt
State purpose and review agenda
Everyone contributes constructively
Pay attention
Be courteous
Focus on topic
Summarize issues and decisions
Assign actions
VISION
To continuously grow on a sustainable basis and be the largest, the most innovative,
the most profitable and the most admired polyester texture yarn producer in the world
MISSION
To be amongst the global leader in textile, with utmost concern towards ecology,
stakeholders and society.
QUALITY POLICY
We at IPCL Silvassa Complex are committed to total customer satisfaction in terms of
quality and services for the entire range of our products.
Our continued commitment to excellence and innovative efforts helps us to stay ahead
as a market leader.
QUANTIFIABLE OBJECTIVES
Parameters
Efficiency Level
Production of 1st Quality
Packages
Texturising
(Plant -1)
Texturising (Plant -2)
98.5 %
98.0 %
95.0 %
95.0 %
Total Hard Wastage

MACHINE Breakdown %
( Mechanical )
MACHINE Breakdown %
( Electrical )
0.28 %
0.35 %
0.05 %
0.18 %
0.05 %
0.15 %
Based on above main Quantifiable Criteria necessary framework is provided for reviewing
and establishing the Quality Objectives in Indian Petrochemicals Corporation Limited It is
communicated and understood within organization and reviewed for continuing suitability.
HEALTH, SAFETY AND ENVIRONMENTAL POLICY

At Indian Petrochemicals Corporation Limited, Silvassa Complex ( IPCL Silvassa
Complex) , Occupational Health, Safety and Protection of Environment are of prime
concern and an important business objectives. IPCL Silvassa Complex, having role
in providing competitive goods and services in the Polyester Yarn market in India
and abroad, is conscious of its responsibility towards creating, maintaining and
ensuring a safe and clean environment, reduce Health and Safety hazards through
application of technology and safe work practices for sustainable development.
In particular, we are committed to
Comply with relevant laws and regulations as well as take any additional
Measures considered necessary.
Follow a systematic approach to environmental management plan
as
well as
Occupational Health and Safety Management Plan in order to achieve continual

performance improvement, Prevent pollution, maximize recycling and reduce
wastes, discharges and emissions, minimize occupational health & safety risks.
10
Conserve natural resources by their responsible and efficient use in all our
operations.
Systematic education of
company
employees & Contractor
personnel
for
observing safe work practices & establishing continual improvement .

Pre-employment
and
periodic
medical check up
of
employees
for
early
Identification of occupational health hazards.

Make this policy available to the public.
Our objective in implementation of this policy is long run sustenance and
growth of our business by continually improving business process, profitability,
enhancing satisfaction of all interested parties and proactive compliance with
applicable HSE regulations.
PERSONNEL POLICY
It is the aim of the company to get the right talent available in the country to man the
various functions and provide them with good working environment to get the best
results. A filament is a highly specialized and competitive business in the international
arena in which the company has to complete with giants established in the field. The
companys objectives are to be a significant player in the domestic market and establish
an international image in selected areas.
The guidelines under these policies are:
1.
To strive for optimum utilization of human resources and creating an

Environment which is conductive to higher productivity and quality;
2.
To achieve excellence in implementing the statuary and Non-statuary welfare

programmes for employees of the company;
3.
Implementation of HRD Policy of the company;
11
4.
To train and develop the employees of the company in relation to HRD Policy and
ISO- 9001, ISO- 14001 & ISO- 18001 towards achieving Goals and objectives of
the company;
5.
To achieve perfection in educating employees of observing and implementation

safety precaution and devices to safeguard men, machine, materials and property
of the company;
6.
To operate within the framework of standing orders of the company and with in spirit
of laws of land.
HUMAN RESOURCE DEVELOPMENT POLICY

This policy of human resource development at IPCL will be based on the firm
Commitment that Total Customer Satisfaction in terms of Quality &Services. Hence, a
strategy of customer satisfaction and technology supported by
competent human
resource network will give the company and its products the necessary competitive
edge in the Domestic and International market.
OBJECTIVE
The Human Resource developmental efforts at all levels of working, will be guided as
per the following:
1. Strengthening of prevalent congenial atmosphere by ensuring the active involvement
of the people in the policies, procedures, processes and systems.
12
2. Enhancing the spirit of camaraderie through mutual trust, self-respect and

collaborative team efforts;
3. Generating a climate of openness and proper information sharing by active listening
and communication skills;
4.
Setting
in
motion
the
efforts
towards
achieving
business
profits,
speed, Simplicity and self-confidence.
SOCIO-CULTURAL ACTIVITIES AT IPCL
Periodically holding medical camps for blood donation, Polio Camp, Eye & Skin
Treatments for Employees & Surrounding Villagers.
Ambulance donated to Red Cross
Nearby schools adopted for computer education
Tribal Womens Education
Sneh Sutru Magazine
BIRDS EYE VIEW

Name of the company
: Indian Petrochemicals Cooperation Limited
Year of Incorporation
: 1994
Constitution
: Private Limited Company.
Board Of Directors
: a) Mr. Shiva P Chakravorty (chairman)

b) Shri C. Bose (Managing Director)
c) R. Santhana Raman (Director)
Bankers
: HDFC Bank
Dena Bank
Syndicate Bank
SBI
ABN Ambro Bank
Auditors
: Chaturvedhy & Shah.

13
ACCREDITATIONS
ISO 9001:2000 - QMS certified
ISO 14001:2004 - EMS certified
OHSAS 18001:1999 - certified
TQM & Quality Circles
Six Sigma activities across all functional areas
Eco - friendly operations
Du Pont certified and accredited Lycra Lab.
OekoTex certified Products
AWARDS & ACHIEVEMENTS

Best Housekeeping award from Baroda Productivity Council.
First prize in inter -industry safety poster / slogan competition in D&NH.
Winner in inter industry cricket tournament for continuous last 3
years.
Received Certificate of Excellence for CASH project in 2005-06.

Received appreciation from D&NH administration for providing excellent fire services
in D & NH.
LOCATION
A)
Factory/ Works
: Silvassa Industries Pvt. Limited

342, kharapada, Naroli
14
Near Silvassa
Union Terrotiory of Dadra & Nagar Haveli
Pin code 396 235
B)
Registered Office

T-5, Vikram Chambers,
Opp, Mahila Milan Mandir, Ashram Road,
Ahmedabad 380 009
C)
Corporate office

Shree Ram Mills Premises,
Ganpat Kadam Marg,
Worli, Mumbai 400 013
ORGANISATION OVERVIEW
Product
Polyester TexYarn
Plant Commissioned
1995 Sept
Licensed production capacity
300 KTA
Installed Production Capacity
:
:
158
Share in the Indian market
12 -14 %
Exports
25 - 30 %
Turnover FY 2006-07
No of Texturising Machines
140 KTA
1192 Rs. crs
INFRASTRUCTURE
Site Location
Silvassa
15
Located in Zero Pollution area
128 Acres
Built-up Area
120,000 M2
Air conditioning capacity
6,300 TR
Power connected
33 MVA
Power tariff
2.95 Rs
Compressed air capacity
95,000 M3
PRODUCT PROFILE
Process
Texturising
Raw Material
POY ( Partially Oriented Yarn)
Final Product
Textured & Twisted Yarn
Basic Products
Crimp, Tex, Intermingled
Customers
Bhiwandi, Surat, Kanpur, Udaipur,
Amritsar
and Many
Export Countries
Turkey, Belgium, Switzerland, Canada, Japan,

Mexico, & Bangladesh
Specialty Product
Lycra Covered, Melange, Bi-shrinkage, Thick &

thin, etc.
End Use
Suiting, Shirting, Saris, Jeans, Knitting & Dress

Material.
MANPOWER BRIEF
Supervisory
211
Non- Supervisory
836
Contract Labours
995
TOTAL
2042
POLYESTER UNITS
16
Allahabad Unit, Uttar Pradesh

Barabanki Unit, Uttar Pradesh
Dhenkanal Unit, Orissa
Hoshiarpur Unit, Punjab
Nagpur Unit, Maharashtra
Silvassa Unit, Union Territory of Dadra and Nagar Haveli
MANUFACTURING FACILITIES
Capacities of Polyester Units
Name of Polyester Unit
Installed Capacity MTA

PFY141,000
Silvassa Unit, Union Territory
PTT - 600
SUBSIDIARY COMPANIES
A)
Recron Polyester Limited
B)
Synergy Synthetics Limited
ORGANIZATIONAL STRUCTURE AT IPCL

POY STORE
Material
Group
PPC
Production
Process Control
PlantII
INDIAN PETROCHEMICALS
COOPERATION LIMITED
Productions/Process
Warehouse/Excise
Stores
QA/R&D
Control
HRD
Packing
Systems
Engineering/Packing
17
TRAINING SPOT
PLANT LOCATION
PLANT I & PLANT II
TEMPLE & ADMIN BUILDING & FINANCE DEPARTMENT
18
GUEST HOUSE
PTY
POY
19
ERP (ENTERPRISE RESOURCE PLANNING)

ERP an Enterprise Resource Planning is a packaged business software system, that
integrates all the functions such as planning, manufacturing, distribution, shipping,
accounting etc. into a single system, design to serve the needs of each different
department within the enterprise. It is a complex piece of software that enables a
company to manage the efficient and effective utilization of its resources (Material,
people, plant, equipments etc). Thus ERP surely brings significant changes to how a
company does business, as it tinkers with the workflows, and alters long-standing
processes.
IPCL PURPOSE FOR USING ERP PACKAGE

To automate the workflow and integrate various departments of the enterprise.
To share common data & practices across the entire enterprise.
To make the employees more outward focused towards customers, suppliers &
business partners rather than worrying about internal processes.
To provide the backbone for further extending the functionality through bolt on &
other solutions, such as product lifecycle management, supply
chain, e-
commerce.
To yield significant non-tangible benefits such as visibility of Information,
smooth processing with adequate controls & enhanced integration.
20
SAP (SYSTEM APPLICATION PROGRAMME)

SAP can be introduced as 4th largest independent software supplier, founded by five
former IBM employees at Germany in 1972. It is available in 14 different languages
and implemented by more than 7500 customers all over 90 countries in the world.
Founded in 1972 as Systems Applications and Products in Data Processing, SAP is the
recognized leader in providing collaborative business solutions for all types of industries
and for every major market.
SAP is the third generation set of highly integrated software modules that performs
common business functions based on multinational leading practices. It takes care of
any enterprise, however diverse it may be in operations, spread over the world
geographically. SAP understands that the only industry that matters to you is your
industry. That's why there's no such thing as a generic industry solution from SAP. Sap
solution sets are based on an in-depth knowledge of the processes that drive your
business, whether small business, a midsize company, or a large enterprise.
COMPONENTS OF SAP
FI
Financial Accounts
SD
Sales & Distribution
PP
Production Planning
MM
Material Management
QM
Quality Management
21
PM
Plant Maintenance
HR
Human Resource
IPCL PURPOSE FOR USING SAP
Global Basis
Faster Speed
Flexibility for Changes (Business & IT)
Alertness
Reach New Opportunity
Knowledge Sharing
Creativity Focus
SAP R/3
IPCL uses SAP R/3 for controlling its whole system. SAP R/3 is SAP's integrated
software solution for client/server and distributed open systems. SAP's R/3 is the
world's most-used standard business software for client/server computing. R/3
meets the needs of a customer from the small grocer with 3 users to the multibillion dollar companies.
22
SAP PROCESS MODEL

Sales Order
Delivery Note
Goods Issue
Business Plan
Billing
Accounts Receipts
Sales Forecast
Inventory Management
MPS
Accounts Payment
Invoice Verification
R
E
P
O
R
T
I
N
G
MRP
Goods Receipts
Purchase Order
Requisition
23
FUNCTION OF SYSTEM DEPARTMENT

To provide solutions for hardware problems and to make new softwares as per the
requirement of different department. The entire unit of IPCL is computerized. SYSTEM
department controls each unit in IPCL. System department is divided into two parts.
1. Hardware Department
2. Software Department
3. Network Department (which is within hardware department)
HARDWARE DEPARTMENT
Hardware means those physical components to which we can touch and feel like
monitor, keyboard, mouse etc. It supports various departments of IPCL by solving
their problem, provides Personal Computers to various department or users and
checks the configuration of the computers, which are received from the vendors.
Repair the computers do troubleshooting and requested software installation.
Switches are used to connect servers to nodes so that data can be stored and
accessed by the concerned users. these switches are located in each and every
department i.e. POY Godown, YOI A, YOI B, YO2 A, YO2 B, System,
Administration department etc.
MAIN FUNCTION
Solve problems related to printers and PC
Operation of LAN through a device called switch
Operation of WAN through leased lines.
24
SOFTWARE DEPARTMENT
Software means those components to which we cannot touch or feel. We can only
see it. The software department basically performs the function of
Software Development
Software Maintenance
Software Modifications
To develop various soft ware for better communication and prevent error and to
make the work easy and store the data.
Certain software developed is sticker printing, pay roll, doffing schedule, material
store, POY issue and receipt system, etc.
Previously in IPCL all the software were developed using FoxPro language, but now the
scenario has been changed due to incoming technology. Now all the software have
been developed using Visual Basics.
The various software applications used are as follow:
1. APS Lines/Pallet Scanning/Jumbo
2. APS TR/SAP unload
3. APS- Reports
4. Weigh Bridge
5. Budget Tracking System
6. MIS
7. POY System
8. Help Desk
9. OLT- Client
10. Payroll/ESS/IT
11. ISO Documentation System
25
12. Database Administration

13. Server Administration
14. Waste System
15. Contractor System
16. QMS
17. System Analysis and Design
18. Label Printing System
19. BACK UP Management Systems, etc.
NETWORK DEPARTMENT
At IPCL we use LAN, WAN and Lease Line for network connectivity. The speed of
these varies accordingly. Here various topologies are used.
Software, Database used in IPCL (Silvassa)
Visual Basic: Visual Basic is a product of Microsoft and is an object oriented
Programming Language in which it is easy to develop windows based applications.
SAP: SAP is the leading Enterprise Information and Management Package
Worldwide. Use of this Package makes it possible to track and manage in realtime, sales production, finance accounting and human resources in an enterprise.
SQL server: In SIPL, SQL server is used as database to store information. SQL
server is product of Microsoft.
26
PROCESS APPROACH FOR SOFTWARE SECTOR

New/Modifications of
software request from user
department
Will assign the job to

s/w in charge engineer
for feasibility study.
Will study the feasibility, if

feasibility study is possible
Will go ahead with

design, modification, s/w
coding programming and
testing of s/w with user
before implementation
After successful completion of
test with user s/w acceptance is
obtained from user and s/w is
implemented at user department.
27
FUNCTION OF UTILITY DEPARTMENT
Supply compressed air at required pressure to roto machines, pneumatic

instruments such as splicer and APS.
Supply cooled air in the plant so as to maintain good working condition.
Supply water for drinking purpose for cooling tower etc.
SECTION
Compressor (For balancing Air for PLANT -1 and PLANT -2 there are 29
compressors at present )
Total 8 compressors
2 Ingersol rand centrifugal type of compressors
6 Atlas Copco screw type of compressors.
Chiller (Total 9 Chiller is there to provide cooling facility to PLANT 1 and PLANT
2)
Total 6 chillers
4 blue star chillers
2 Trane chillers
Water system (For providing cooling system.)
Raw water plant (toilets etc.)

Drinking water plant(for drinking)
Soft water plant (for machinaries)
28
POWER DEPARTMENT
The main source of power supply for SIPL is Gujarat electric board.
They supply 66 kv power .the power section uses two types of motors to manage
power.
LT MOTOR AND H T MOTORS

HT converts 66 KV power to 6.6 KV by using power transformer. The total capacity
of power transformer is 55 mva. There are four transformers in switch yards, out of
them two are 15 mva and other two are 12.5 mva LT motor convert 6.6kv to
430vVolts by using distributed transformer.
There are 16 distributed transformers present in the plant used in switch yard, out
of them two are 15 mva and other two are 12.5 mva.
DISTRIBUTION
YO1 having four numbered from 1 to 4
YO2 is having four numbers from 4 to 8
PLANT 2 having four numbered from 9 to12
Utility having four numbered from 13 to 16
Total unit of power consumed each day is 6, 42,500 KWH
29
PLANT I & II
In PLANT II only two types of machines are used, One is Barmag FK6-1000 and
another is Barmag AFK.
S.No
1
2
Type of Machine
Barmag FK6-1000
Barmag AFK
Total
No. of Machine
12
36
48
The total Barmag AFK machine is 36. Out of this twelve (12) machines are manual and
rests of 24 machines are automatic. By manual we mean that one of the function or
operation is done manually. In manual machine when the bobbins are required diameter
and weight it gives indication. The indication is given by lightening of red light. At that
time the worker has to come and break the yarn and load another POY for further
texturing of doffing. Whereas in the case of automatic machine when the bobbin is of
required weight and diameter the machine will automatically break the yarn and the yarn
would come in the tray. As soon as the bobbin comes in the tray another tube take it
place and textured yarn starts wrap on it. In PLANT II raw material POY is issued
directly to the machine. There is no facility of godown. There is no separate department
for packing as packing is done near the machine. This helps in reducing the error of
mixing different bobbins of having different merge number in the box.
In PLANT II there is no weight and vision system in the packaging department as the
machine only does the weight and diameter measurement. Thus these machines are
more advanced. They perform various functions, which machines of Plant I cannot do.
30
In Plant I Barmag AFK machines have been bought from IRELAND whereas Barmag
FK6 machine have been bought from Baroda. Preventive maintenance of the machine
is done after every 45 days. The length of the tube on which POY is loaded varies but
generally it has the diameter of 69mm. The engineers of production department by
taking the rpm of the machine calculate the time taken to accumulate the PTY of
required weight and diameter. This time is set in the machine and soon as this time is
reached or spent, the automatic or manual breaking of yarn is done and new tube takes
its place with concluding texturing of next POY is done.
The various parameters set in the machines are as follow-:
POY Denier
POY Merge
Speed
Oil RPM
Batch No.
Paper Tube
Doff Time
Doff weight
Doff diameter
Air Pressure
31
COMPARATIVE STUDY
S.No
1
Parameter
Goodown
PLANT I
PLANT II
It has separate godown No facility of godown. POY of
and on requisition yarn of required merge number is
required merge number is allotted directly to machine.
allotted to the concerned
Material
Group
Type
department.
Yes
NO
of SDS 700
Machines
Barmag FK6-1000
SDS 1200
Barmag AFK
Barmag FX-900
ICBT
Murata
4
6
Alidhara
Advance
Less advance machines.
More advance machines
Time taken More
time
taken
in Less time taken in production
in
production as there are as cascading of many steps
production
various steps.
take place.
Weight and It is done after doff has This is inbuilt facility in the
vision
came out of the machine. It machine. As soon as the doff
system
is
separate
from
machine.
8
9
this
the takes the required size and

weight automatic or manual
Waste
In
there
Size
wastage
Big and old plant
is
breaking of yarn is done.

more Due to automation less
wastage.
Small and new plant
32
10
Denier
Generally
PTY
of
less PTY of heavy denier is made
denier is made
ORGANOGRAM
UNIT HEAD
HOD - RMS
JR. - OFFICER
ASSITANT
LEADING HANDS
33
STORE DEPARTMENT
This is one of the most important departments. It stores all the material except raw
material POY and finished material PTY. All the various requirement of the
department are fulfilled or satisfied here. The various functions performed by the
store department are as follows-:
1)
Stores stationary items like note books, registers, cards, used by various
departments
2)
Stores machine parts
3)
Sends the machine parts for repairing to the concerned vendor
4)
Issues the new machine parts to the concerned engineer or department
5)
Keep the data of goods available, goods demanded and goods allotted to
concerned person or department
The Engineering section consists of two, one is receipt and other is issue.
The engineer takes sample from the store section of goods demanded and check
whether it is of required quality or not. If it is of low grade quality than the whole
goods is returned to the supplier.
RMS- WORKING PROCEDURE IN BRIEF

A)
To make availability of all Raw Material & Packing

Materials required by Production Department.
B) Receipt, Storage and issue of all incomings.

34
Minimum, Maximum, & Order levels are maintained by RMS and purchase request
is raised for the material below re- order level. On receipt of the material the
quantity is verified with purchase order & supplies Challan / Invoice and the
material is unloaded. Q.C. Department is intimated along with intimation slip to pick
up batch wise sample for analysis. The material is shifted to its designed area with
proper tagging for its further trace ability. As and when the material is required by
the production Department it is issued as per FIFO system.
POY STORE
The process of yarn starts from POY store. It is the store where supplier of POY
dispatches their raw material. This store performs various functions right from
generating and dispatching the invoice and giving the required POY to concerned
plants. It keeps the record of which plant needs POY of which type or merges
number. As soon as they get the raw material which has been marked as critical
stock or the stock in demand of specified Denier/Filament they send it soon as they
receive to concerned department so that the process remains continue. Denier
varies from 30 to 330.
A denier can be defined as weights in grams of 9000 meters. There are various
suppliers from where we get POY. These are as follow-:
S.NO
Suppliers
RIL, Hazira Plant
RIL, Patalganga
CIPL, Nagpur
RSF, Allahabad
5
6
AFL, Hosiarpur
RIL, FDC
35
The truck, which comes to SIPL with POY, loaded at that time the truck number is
noted. After passing through the first gate the trucks weight is weighted with POY
at the second gate. This truck after dispatching the raw material at store comes
back to the gate. At that time again the trucks weight is weighted without POY
and then he has to show the receipt in order to exist SIPL. The raw material
obtained is either used as job (for Reliance itself) or for IPCL. If it is for job (RIL) it
is recorded as 927 and registered as SI52 and STJW where as if it is for IPCL it
is recorded as 101 and registered as SI01 and SCST. Generally 70% of raw
material comes from RIL, FDC in order to decrease the sales tax. When it comes
from RIL, FDC sales tax imposed is 1% and when raw material comes from RIL,
Hazaria Plant the sales tax imposed is 4%.
For IPCL type various entries entered are as follow
Challan Number
Excise Group
Reporting Number
Freight vendor
For job type, where the finished goods would be used by RIL, the various entries
entered or recorded are as follow-:
Delivery Quantity
Truck depot number
Document posting date
Thus in this way purchase order and goods receipt is made and its print out is taken and
kept for further reference. The raw material comes in various packages or form.
S.NO
1
2
3
TYPE of PACK
RU
CARTOON
EXPORT
DISCRIPTION
Contains 36 tubes of 665 Kg
36
JUMBO
MATERIAL GROUP
The marketing department gives the data to Material group regarding which type of yarn
and of what quantity is to be produced. After receiving the data the material group
change or set the hardware parameter of the machine in order to produce the
required type and quantity of yarn. So as per requirement the material group takes
yarn from warehouse to buffer area. The work is done in three shifts named as shift
A, shift B and shift C.
FUNCTIONS OF MATERIAL GROUP
Decide the POY requirement for 24 hours of all the machines
Raising an issue to warehouse for the quantity required for each merge under the
specific account head.
Stocking the material in the buffer area
Allocating the loading of material to loaders
Cross checking the loading of POY on particular machine in order to prevent mix
up of different deniers
Scanning of the barcode on the machine creel
OTHER ACTIVITIES OF MATERIAL GROUP
Records of the no. of POY loaded for each merge and source.
Record the no. of POY without tail end & collection of unworkable POY and
sending it back to respective sources.
Collections of bottoms of each merge.

37
Collection of the cutting and stripping waste of POY and recording the same.
Flowchart for material issue to user department from stores

Material reservation raised by
the user department in the
system.
Reservation no. intimated to the
stores department by the user
department
Stores department books the
issue with reference to the
reservation no. and prints the
Return to vendor as per the
process
As per the material issue note

material is withdrawn from the
storage location.
Material delivered to the user
department
END
38
Steps for repairing jobs in Engineering Stores
Receipt of repairing material with

requisition request from the user
department for refundable gate
pass.
Preparation of refundable gate

pass in the system.
Getting the approval from the
DGM (stores) in the system.
Getting the released from site

excise department in the system.
Getting the print out of refundable

gate pass copy and getting the
signature of concerned person
Sending out the material to the

vendor
Receipt of material as per the

receipt process approach.
END
39
ORGANOGRAM
Ware House Manager
Sr. Officer
Receipt
Section
Textured
Material
Material
Asst.
Officer
Receipt
Supervisor
Dispatch
Section
Documentation
Section
Asst. Officer
Domestic
Dispatch
Asst.
Officer
Export
Dispatch
Asst.
Officer
Computer
Operator
Operator
Loading
Supervisor
40
INTRODUCTION
Warehouse Department is the place where finished goods are stored that is finished
yarn (PTY) is stored. The PTY after being released by packing department is sent to
warehouse department. This department checks the goods received. It has to take care
that boxes on the pallet are of same batch number or not. After that it is the
responsibility of warehouse to load the truck with PTY and send it to concerned
department. If there is no order it will be stored in warehouse only. Thus from here the
final dispatch of the finished goods starts.
The main function is to receive the material from lag area and store it in the ware house
and dispatch the same as per requirement stated by marketing department.
SECTIONS
1) Receipt system
2) Dispatch system
RECEIPT SYSTEM
Receiving the material from lag area through transfer note.
Updating the transfer note in SAP system and assigning the location to the
material.
Stacking the pallets as per the location of SAP system.
The location is from FA to FO with an avg. of 40 rows in each.
The location FZ is used for storing downgraded material.
41
DISPATCH SYSTEM
Receive the order from marketing department.
Check the availability and location of the material.
To make a material pick- up- note (MPN) through SAP system so as to free the
location and dispatch the material as per MPN.
Cross checking the quantity and no. of pallet according to MPN.
Make the invoice and dispatch the material
POY GODOWN
It receives the material under different accounts.
Accepts the material by checking the same and entering in SAP system.
Locates the material in the godown as per free location available through SAP
system.
File the packing list of the material received and invoice of the material account
wise.
Issue the material as per the requirement of material group(through SAP system)
Prepare the stock report daily.
Other activities of POY GODOWN
Returning of the pallets and jumbos.
Sending of the scrap material.
Returning the POY that is unworkable on the machine.
Reuse of the POY paper tube after getting it checked
42
INTRODUCTION
Production is considered to be the backbone of an industry. It is the step-by-step
conversion of one form of materials into another, through chemical or mechanical
processing, to create or enhances the utility of the products or services.
Production is at the center and all other activities revolve around it. It deals with
decision making related to production processes, so that the resulting goods or
services is produced according to specifications. Therefore to run production, we
require service activities which make sure that the manufacturing activity can go on
and control to make sure that it goes in right direction.
TEXTURING
It is the process where yarn is inserted in bulk with the help of heater and twisting units.
It is the process to strengthen a texturing yarn to work properly in future process. At
IPCL we have two plants named as Plant I and Plant II. There are total 158 machines
at IPCL. Plant I comprise of 110 machines and Plant II have 48 machines. The table
below shows the type of machine at Plant I. It produces 380 tones of textured yarn per
day and about 100000 packages are packed daily. It exports 30% of its production to
European countries. And remaining of is used for domestic purpose. The main work
done here at this plant is Texturing.
Textile products are sold under the brand names of Only Vimal, Harmony, Reance,
RueRel and V2 (pre-cut, pre-packed products). The flagship brand ONLY VIMAL is
India's largest selling brand of premium textiles. In a survey conducted by The
Economic Times, it was voted as 'India's most trusted Fabric Brand'.
43
IPCL efforts in research and development has resulted in several new products
and processes, such as fluorescent shades on polyester fabrics, extended
laundering colourfast fabrics in dope-dyed fibres, water and oil repellent finishes on
polywool and Lycra stretch fabrics, wash-fast and flame-retardant fabrics.
ORDER PAYMENT CYCLE

Marketing Department
Production planning
POY Godown
Material Group
R & D / Process
Control
Production
Quality Assurance
Process Control
-
Auto - packing system.
Lag Area
Ware house
44
STEPS
1.
POY Loading:- It is the first step to the PTY production. So it should be carefully
done Otherwise unnoticed error would create more problem in end.
Every
machine has two sides A and B. There are total 108 positions on each side. New
machine have total of 240 machines. Therefore 9 creels are used to load the one
side of the machine. Each creel has 24 tubes. It should be noticed that POY of
same merge number should be used on the same machine to produce yarn of
same quality.
2.
Creeling and Threading-: Creel the whole machine up with yarn, ensure that
each supply package is correctly aligned in relation to the yarn guide tube and that
it clears the baffle plates .Pre thread the creel as far as the first pig tail guide
situated prior to yarn cutters.
3.
Creeling Supply Packages-: In placing the packages on the creel page careful
handling is essential in order to avoid damage to the yarn mass. While the
packages being handled, it is convenient to locate the leading ends of the yarn and
to leave them in an accessible position Take off discs should be used on packages
to prevent snags on the end of the supply tubes if it is not perfectly smooth. Doffing
is performed without interruption to the draw-texturing zone and therefore does not
involve re-threading.
4.
Process Specification Development-: The development of optimum process

specification on high-speed draw texturing equipment is complex and many factors
influence the choice of the final process parameter. This section outlines the basics
method of specification development and discusses the effect of varying each
45
process parameter as well as giving typical setting for each parameter. The
development of a process specification is broken down into three stages, which
must be completed in sequence to avoid complex integration. Before the
specification development procedure is begin a starting specification on needs to
be established. This allows yarn to be process so that tensions levels can be
measured and product quality examined.
It is the principle department whose main function is to produce the textured yarn
at targeted efficiency.
Checking that the machine is loaded with specific POY and ready with other
accessories like jet in case of roto product.
Receive the batch no. to be given to the final product, from the process control
department.
Decide the paper tube colour to be used.
Collect the sticker from the system department for that particular denier, machine
and product.
Sticking of stickers on P/T and fixing it on the machine and keep it ready for yarn
threading.
Start the yarn threading on machine after getting clearance from process control
department.
Take a short doff after completing yarn threading.
Deciding doff duration as per diameter of 218 mm
Taking the doff as per time and release the same to PC department with proper
identification i.e. yarn card and stickers on each trolley and paper tube.
Yarn card and sticker cross checking by dispatcher
Entering the same through trolley barcode scanning in
BTS or TTS system
whichever is applicable.
Other activities of Production
Do splicing of tail end of running POY with end of reserve POY.

46
Machine loading in case of clearance after breakdown.
Enter the doff weight and mode of packing in the batch master system.
To clear the textured package within 24 hrs for the material which is running for
exhaustion
Yarn Path through the machine

Creel
Creel pipe
Cutter
Input roller
Primary Heater
Cooling plate
Spindle unit
Inter mediate roller
Secondary Heater
Out put roller
Oiler Roller
Traverse guide
Winding drum
47
PRODUCTION PLANNING
It receives the information regarding the type of the product and quantity of the
product to be produced by marketing department.
In accordance with the production department plans for the availability of the
machine.
In todays environment production plays a very important role as concern to the

development of company.
PROCESS OF PRODUCTION PLANNING
The production planning start with the preparation of budget.
Devising manufacturing method and sequencing of process.
Set the plant layout.
Estimate material and manpower requirement.
Preparation of MPS and CRP.
Periodically improvement of quality.
Daily production is made on the basis of three important aspects.

1.
MONTHLY PRODUCTION PLAN.
2.
SHORTAGE LIST.
3.
POTENTIAL OREDERS EXPECTED.
48
Monthly production plan is prepared by the unit head, on the basis of which the daily
production plan is prepared by H.O.D. (Prod). Subsequently, when they get the
shortage list, production plan is again updated and at last it is put in to action.
FACTS AND FIGURES
There is one operator on each machine for the activities listed in the production
flow chart.
Apart from that there is 1 dispatcher for a group of 20 machine who leads the team
of contract personnel whose function is to see that dirty and damage packages are
not delivered to PC III department.
The dispatcher also collects the waste at the end of each shift and reports the
same to the engineer along with the no. of trolley and packages released to PC III
section.
One more operator is there to look after the batch close system and other general
activities.
MATERIAL HANDLING
Material handling is simply picking up, moving and laying down of material through
manufacturer. It is helpful in movement of raw material, part of process, finished
goods, and packing materials, disposal of scraps and even transportation of
workforce in the plant. Proper material handling facility reduces production cost by
reducing time and energy etc.
MATERIAL HANDLING EQUIPMENTS
Fork lifter.
49
Wooden pallet.
Belt conveyer.
Roller conveyer.
Hand trolley.
Electric hoist.
Pipelines.
Stacker.
INTRODUCTION
The main function of Process control department is to decide the machine parameters
for different types of yarn through trials and monitor the quality of the product as
well as to control the process by preventing down gradation of material through
necessary corrective action and analyze the reason for breakage and take
corrective action accordingly.
The process control department has three sections.
PC 1 ( Co ordinates with YO1 Production)
PCII (Co ordinates with YO2 & YO3 Production)
PCIII (Arranges for releasing of the material from YO 1,2 & 3 on either OLT,TKD
or TYT bases)
The main function of the PC department is: -
Inspection of raw material
POY
Coning oil
Paper tube
Product control through
OLT (On Line Tension) System
TYT (Textured Yarn Tester)

50
TKD (Tube Knitting and Dying)
There are four numbers of machines at present. The process control department has
three sub departments PC 1, PC2, PC3.
General works done by PC department
Machine Auditing
Machine Checking
Export Box Checking
PROCESS CONTROL I & II
Take trials with different machine parameters and type of products.
Send the packages for laboratory testing
Check the lab results with the specified requirements and norms.
To change the parameters if required and finalize the same through lab results
analysis.
Give the batch no. through batch master system.
Checking the actual machine parameters once again and give clearance for
production.
Grading of the packages produced as per OLT.
Entering the downgraded packages in a register in order to analyze repetition of

the fault on particular position.
OTHER ACTIVITIES OF PROCESS CONTROL.

As said earlier that one of the main functions of PC is to control the process and for
that it is very necessary to ensure that actual machine parameters are same as those
set.
DATA BOOK OPERATOR

51
He checks and ensure that the machine speed and parameters are same as
those set
He is allotted a group of 20 machines whose parameters should be checked with

in 3 to 4 days.
Apart from that he follow up the positional fault memo from APS and QA lab
faults and rectifies the same with the help of line fitter.
MACHINE MONITORING OPERATOR
He checks for the reason for the breaks and prepare the report
Reasons for the break.
POY problem
Splicing break
Bottom break
Guide worn out
Others.
Apart from that he checks the yarn path of non OLT machines.
Snap study of non OLT machine every two hours.
FACTS AND FIGURES
There is one data book operator for a group of 20 machines. (A Shift only)
One PC operator.
One machine monitoring operator.
OLT operator for group of 20 machines (All shifts)
PROCESS CONTROL III

52
The main function of PC III is to receive the material produced by production and
release the same to APS department based on either OLT, TYT or TKD.
Thus material flow will be as flow as follows.(for OLT base)
Stripping of the material.
Releasing of the material.
Stripping of 50 mts is done.
Along with stripping the material is checked for low nips, dirty, damage, and
single yarn in double or double yarn in single.
If any abnormality is found same is informed to the prod. Dept. through memo.
INTRODUCTION
Quality is the totality of features and characteristics of a product or service that bear on
its ability to satisfy stated or implied needs. It is a sense of appreciation that something
is better than something else. It changes in a lifetime from generation to generation and
varies by facts of human activity. Quality means focusing on production of increasingly
better products and services at progressively more competitive prices.
Today, companies have no choice, but to implement total quality management
programs, if they are to remain solvent and profitable. Total quality is the key to value
creation and customer satisfaction.
QUALITY OBJECTIVES
To establish and continuously upgrade the standard of raw material and

keeping the suppliers informed of our requirements as well as their short
comings.
To upgrade and develop new process to meet the customer requirements.

53
To ensure availability of competent manpower and to further enhance their

skills and competence.
To maintain the consistency in manufacturing by producing right product in

first attempt.
To enhance the timely delivery to customer.
To enhance corrective and preventive action activities at functional level.
PROCEDURE OF QUALITY DEPARTMENT

Quality process involves the understanding of who the customer is, what his needs are,
and how these needs can be satisfied. Thus, Quality process comprises different steps,
through which complete satisfaction is provided to the customer. Quality operation is a
process and inspection of raw-material, semi-finished products, and finished products.
The sample of raw-material is tested in the lab before the material is entered to the
stores department. After that if it is approved by the quality department a log tag with
O.K mark is put on the material and then send for production and if it is not approved
then it send back to the supplier.
When the production process is completed with the approved material, the finished
product is tested by the QC department and if the finished product is not according to
the standard quality it is again handled to the production department. This is called Proactive method.
FUNCTION
54
To ensure that the quality produced is upto the required standards and according to the
norms lay down. Moreover the material used in the process should also be as per the
norms.
SECTIONS
1)
PHYSICAL TESTING LAB.
Paper Tube
Weight
Dimension
Compression strength
Corrugated Box, Centre Plate Etc.
Weight
Dimensions
Printing defects
Puncture resistance
Bursting strength
Bopp Tape
Holding Strength
2)
CHEMICAL TESTING LAB
Oil pick up percentage
Properties of coning oil.
Viscosity
% Volatile impurities & % moisture
Density
PH of drinking water.
55
Distillation of water (for use in battery)
Dyeing of tube Knitted hose
PURPOSE
To see that only inspected material used in process. Use only conforming process
material for quality analysis, identifying and holding non-conforming process material
and then releasing after proper analysis. The final product conforms in all respects to
product specification and for non-conformity material it is only dispatched after suitable
gradation or identification. The test for quality is done on the material as per specified
sampling plan. This is applicable for both incoming as well as in-process material. The
variation inspection and testing procedures, which can be carried out by QA for various
materials, are as follow-:
1) Coning Oil Testing.
2) ply testing
3) Box testing
4) Compress testing
5) Printing testing
6) Box weight
7) Testing of wooden Platte
8) Testing of denier of YARN
9) Testing of Elongation and tenacity
10)Bursting testing
There are various instruments used in the Quality analysis Lab. For the purpose of
measuring Denier, tenacity, twist elasticity and nodes in a given or fixed length of yarn.
EXAMPLE:
56
Testing/ Approval procedure for the Paper Tube

Sampling-: The total 10 samples to be drawn first as well as CS, dimensions and
weight.
Approval procedure-: If test of first samples are below our standards in any one or
more parameters are down
If two readings are within 0-5% down and average is ok as per our standards
the result is Accept.
If two readings or more are down and average is upto 95% of our standards then
Re-test.
If two readings or more are down and average is below 95% of our standards the
sample is rejected and is categorized as low-grade product.
INTRODUCTION
The entire APS computerized and for software related problems deepens on SYSTEM
departments. The APS system that has been installed here is supported to be the most
modern equipment to be installed in the industry. This system has been acquired from
CAMEL ROBOT, a Company based in Italy through its India agents the Novell
Industries. The Installation of this machine has led to faster packing & dispatch Rate,
thereby making the plant truly fully automated. The last part of the system that has been
installed at IPCL, i.e., after the installation of the barcode scanner has been directly
installed by Novell Industries. This means the weighing scale to calculate the Net
Weight of the box, the automatic top flaps closer, the strapping machine, and the
automatic centering devices & the pallet has been installed by Novell Industries.
They made two types of packages according to use
57
1. Domestic
2. Export
The main function of this department is to packing the material received from PCIII so
as to provide empty trolley to production. The bobbin after inspected by process control
department is sent to packing department for packing. Here two type of packing is done.
1 Auto packing
2 Manual packing
A brief description on various units of APS system which is essential for easy going of
the entire system given as below
1) Chain accumulating conveyor for loaded trolleys
2) 2 Robot to Unload packages from trolley to disks conveyer
3) Re-circulating disk conveyor to transport packages through system
4) Automatic weighing and vision systems for individual packages on disks
5) Weighing scale Controller
6) Manual inspection is done after passing from weighting and vision system
7) After the manual inspection of the bobbin it is further passed to Wrapper machine for
covering the bobbin with the plastic bags
8) Automatic buzzer for individual packages on the disk
9) Automatic Feeder for wooden pallet
Modes Of Packing
1) Jumbo
2) Boxes
Types Of jumbo & boxes

1)
Neutral
2)
Semi-neutral
3)
Recron
58
The boxes listed above are single Decker boxes which contain 6 Pkgs. /box
Colour of the boxes

1)
Brown.(for job material)
2)
Green.(for own material)
3)
Blue.(for R &D material)
The boxes listed above are double Decker boxes with Texlene Trademark printed on it
(12 Pkgs. /box).
Flow chart of packing material through camel robot.

Trolley
Trolley conveyor
Unloading Robot
Weight system
Manual Inspection Station
Wrapping Machine
59
Auto packing robot
Manual filling
BTS scanning.
BTS scanning
Box inspector
Gross Weigh Scale
Cartoon Labeller
Taping Machine
Strapping Machine
Vacculift
Lag Area
For Domestic packing

Sticking of domestic stickers.
Packing as per grade by SAL checker.
On to conveyor
Gross weigh scale.
Carton labeller
60
Taping Machine.
Strapping Machine.
Vacculift
Lag Area
Warehouse
FACTS AND FIGURES
No. of checkers = 18 (A&B)
No. of Knotter = 02
No. of trolley pusher=02
Box inspector = 02(1 in C)
Data Entry operator = 02(1 in C)
Box labeler = 02 (1 in C)
Target for each checker =1500
Target for packing = 63,000/day (on an avg.)
Production capacity =49,680 ( considering 12 hrs doff and 216 spindles on each
machine)
Packing capacity on Camel robot = 4500 5000/shift
Packing capacity on salmoraghi= 5000 -5500/shift

61
LAG AREA
The main function of the lag area is to store half pallets and supply full pallets to the
warehouse through transfer note.
Receives the boxes from packing
Stacking the boxes as per address
Transferring the full pallets to wrapping station
Scanning of the pallet no. and the boxes on the pallet
Transferring to Warehouse through transfer not.
INTRODUCTION
Maintenance is concerned with day-to-day problem; keeping production facilities
and equipment in proper operating condition. To achieve a high rate of industrial
productivity, it is necessary to
maintain productive facility properly. Everybody
knows that machines break down; parts wear out, equipment and other facilities
detioriate. As a result productivity fails to make its full contribution, if these are
not operating efficiently. For this purpose all the manufacturing concerns follow
some maintenance routing to keep all productive assets in efficient working
conditions and minimize ideal equipment time.
PURPOSE OF MAINTANANCE DEPARTMENT

62
To keep all the production facilities in proper working condition.
Allowing machines and other facilities to operate at their optimal capacity.
To replace the critical parts before they fail.
To contribute a great deal to safety of man power and spoilage of a material.
PROCEDURE OF MAINTENANCE DEPARTMENT

The purpose of maintenance department is to maintain the machine and avoid
breakdown for smooth functioning of production department. The department
maintains stock of frequently required spares part to overcome the breakdown of
machine. There are three types of maintenance carried out by the department.
1.
Routine Maintenance
2.
Preventive Maintenance
3.
Workshop Maintenance
FUNCTION
To keep the machine in good mechanical condition through preventive
maintenance and routine check up as well as to minimize the no. of idle position
due to mechanical fault.
PREVENTIVE MAINTENANCE
Preventive maintenance is plan maintenance, according to which the timely
checkup of machine is done. Under this maintenance, they prepare yearly plan.
Firstly, they inform production department that they want to take particular tank or
machine for maintenance and so they want it empty, with the help of which both
the department can carry on their work.
63
FUNCTION
It should be carried out on the machine with in 33 +/- 7 days
The PM duration is monthly, quarterly, half yearly, eleven monthly.
Buffing of rollers of input, out put and intermediate.
Removal of lapping on all shafts
Cooling plate cleaning
Checking of all the belts and replacing the faulty one
Replacing of damage parts such as worn out guides, discs having cuts
traverse guide which are broken.
Cleaning of all machine parts and airing it.
Checking of the bearings in input, out put and intermediate shafts.
Greasing of all the bearings and parts after 4 months.
Changing of the traverse box oil after 11 months.
ROUTINE MAINTENANCE
Daily oiling and greasing of machine is done in routine maintenance. Routine
checkup of tanks and machines are done for smooth production.
FUNCTION
To minimize the idle position on running machine.
In case the idle position are more than 03 and that cannot be rectified in
running machine then machine is stopped during doff time and idle position
are attended.
Rectify the quality related problems Due to mechanical faults.

For this a memo is given by PC department to maintenance.
64
To Change the gears in case of machine change over and attend the
machine breakdown problem.
WORK SHOP
FUNCTION
To minimize the down time during breakdown by keeping the spares of the
machine in good condition.
Machine in workshop
Roller buffing machine
Lathe machine
Welding machine
Presser (Hydraulic and manual)
Drilling machine.
Eccentricity Tester
SECTIONS IN WORKSHOP
Roller buffing section.
General maintenance section
Spindle shop
Jet cleaning
Welding
Knitting machine maintenance
PLANT ELECTRICAL MAINTENANCE & INSTRUMENTATION

To prevent machine breakdown due to electrical or instrumentation problem through
preventive maintenance and routine check up.
Activities of Electrical Preventive maintenance
65
Cleaning of primary heaters.
Checking of all NCD, cutters, panel board
Checking of all electrical connections
Checking of all instrumentation related cards (control card for PH, SH, oiler and
traverse.)
Checking of all motors for its bearing.
Activities of Routine Electrical Maintenance

Attending the idle positions due to electrical problem such as cutter problems.
Activities of Workshop
Overhauling: Change of bearing in
motors.
Checking of PRV on PM machine.
Venting of heaters.
Keep the spares such as motors and coupling in ready condition so as to

minimize the down time during breakdown.
INTRODUCTION
Human resource of an organization is considered to be the most vital assets, because it
is the people who make other resources moving. They perform various activities in
the organization in different functional areas like production, marketing, finance,
etc.
Organizations require the service of large number of personnel. Each position of the
organization makes certain specific contributions to achieve organizational objectives.
Hence, the personnel who occupy the position should have sufficient ability to meet the
66
requirements. This may require a number of functions like manpower planning,

recruitment, selection, training and development, performance appraisal, promotion,
transfer, etc.
Human resource management is concerned with competing for and competing on
human resource. Competing for human resources involves recruiting and employing
right personnel and competing on human resources involves developing, retaining, and
integrating personnel to achieve competitive advantages.
HUMAN RESOURCES PLANNING

HR planning basically deals with forecasting of additional human resources required in
an organization in future. Although human resource planning means different things to
different people, general agreement exists on its ultimate objectives the most effective
use of scarce talent in the interests of the labour and the organization. Human resource
planning includes the estimation of how many qualified people are necessary to carry
out the assigned activities, how many people will be available.
OBJECTIVE OF HUMAN RESOURCE
To understand the nature of employees and how it is a function of all managers

in an organization.
To understand manpower planning so that right people are available at right time
and at right place.
To understand the issues related to job analysis and the uses for which it is
undertaken.
To understand the concept of performance appraisal and its relevance of

managers.
67
To link directing with the human nature in the organization so that suitable
behavioural and managerial models are adopted.
To understand how to design incentive system, job, & enhance quality of work
life.
PERSONNEL /HRD DEPARTMENT

This P/A department has several sections, those are as follows:
1) Administrator department: This department helps staff in various ways. They
handle mostly all finance tasks, like accounts, Company purchase/Sales Account
Salary Accounts etc. they also control buses services, guest house providing Air
and Train Tickets, also entire telephone system is control by them.
2) Security Department: This department is responsible for safety of entire
industry. This department is directly controlled by reliance group. There are two
types of entry permit photo card and temporary card for visitors there are two
type of cards Green and Red.
3) Medical Department: This department provides medical facilities each and
every employee of IPCL .They conduct an annually medical test for all
employees. They have four staff Medical Officer and a chief Medical Officer, and
also provide medical services for any causality with help of Ambulance facility.
4) Fire and Safety: Various activities done by this department are
i)
Mock Drill
ii)
Noise level monitoring
iii)
Safety committee meeting
iv)
Safety audit and inspection
v)
Siren beam detector checking
vi)
Fire door checking
vii)
Fire extinguisher checking
viii)
Tool box talk to employees
ix)
Work permit checking

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5) Time Office: They handle each employees attendance. They temporary provide
manual attendance register for staff who is new and those who have missed their
ID cards.
They divide the entire work into shifts like A,B,C,H,I,G .
Several types of records maintained by time office are:
1)
Gate Pass
2)
C-Off
3)
CMS Card
4)
Shift Change
5)
Absence
6)
Paid Holiday
7)
OT (Overtime)
8)
Accident and fitness
9)
Buses pass Etc.
ACTIVITIES OF TIMEOFFICE
Attendance
Leave records
Wages for regular staff
Wages for contractual workforce
Over time
General insurance
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Group medical policy and group accidental policy
OHSAS 18001
ISO 14001
Government records and register
Contractual projection and bills
Provident fund
Gratuity
Superannuation
SHIFT AND LUNCH HOURS

The company runs in five shifts. The shift timings and corresponding lunch hours are as
below:
Shift Hours
From
To
07:00
15:00(A)
15;00
23:00(B)
23:00
07;00
(C)
08:30
18:00
(G)
08:00
16:30(H
)
Lunch Hours
From
To
11;00
13:00
19:00
21:00
12;00
14:00
Tea Break
From
07:00
16;30
12:00
04:00
09:30
15:00
09:00
16:20
To
08:15
16:55
00:20
04:20
10:00
15:30
09:30
16:35
LEAVE
The following type of leaves is admissible:

1) Sick Leave
2) Sick leave without Pay
3) Privilege Leave
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4) Casual Leave
5) Compensatory Leave
All the regular employees working with IPCL are entitled to get leave as per the rate
applicable to their category.
EMPLOYEE SELF SERVICE (ESS)
Every regular employee of IPCL has an option of self service system wherein they have
the following options:
Office
Attendance- Reliance
Time-Infocomm
Training
Travel
Reimbursement
Employee separation
Payroll
Personal Information
R-Matrix
Appraisals
Skills
Income Tax Benefits
Forms for Download
For Administrator
Every employee has their own password to access the Employee Self Service, where
he can access his information from the above mentioned functions and make necessary
changes. This information is recorded in the website which can accessed only by the
IPCL employees.
WELFARE FACILITIES
71
IPCL provides various welfare and recreational facilities to its employees, which are
Statuary as well as non-statuary, as listed below;
1)
Sports and Recreation

IPCL offers different sports and recreational facilities to its employees, they are:
2)
a.
Facility for indoor games - Table Tennis / Carom / Chess / Athletes etc.
b.
Sponsor players for indoor/outdoor games.
c.
Conduct tournament for indoor/outdoor games.
Industrial health and safety

Under this head, various facilities, which are provided by IPCL as statuary and
non-statuary compliance for, its employees are:
3)
a.
Medical Inspection Room (MI Room).
b.
Protective clothing, Shoes, Glasses, Safety Belts etc.
c.
Periodic check-up for employees.
Social Celebrations
Various social functions are celebrated at site with employees taking part in it:
a.
26th January Celebration
b.
15th August Celebration

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4)
Canteen
IPCL runs a canteen with facilities of 250 seating for work force and a
different canteen for the officials, where strict vegetarian meals is served for on
coupon basis for Rs 10/- and snacks for Rs 5/-
5)
Bus Facility
IPCL provides bus facility on subsidized rate for attending duty on shift. Bus
passes is available in the time office.
6)
Uniform
IPCL provides uniform and shoes to all employees on yearly basis. All employees
should wear their uniform cloth clean and properly tucked.
7)
Employees Credit & Co-operative society

Employees Credit and Co-operative Society is being running with 1300 members.
To become the member of the society employee should contribute Rs 100/- as
membership fee at first then as saving and Rs 5/- as Employee Labour Welfare
Fund, every month
PERFORMANCE APPRAISALS
Performance Appraisals is a method of evaluating the behavior of employees while
working in the organization, which includes both the quantitative and qualitative aspect
of job performance. Performance can be referred to as the degree of accomplishment of
the tasks that are assigned to an individual. It indicates how well the individual has
73
fulfilled the tasks assigned to him. It can be confusing stating that performance can only
be measured in terms of results.
IMPORTANT ASPECTS OF PERFORMANCE APPRAISALS
Performance appraisal is the systematic description of an employees job

relevant strengths and weaknesses.
The basic purpose is to find out how well the employee is performing the job
within the organization.
It is a systematic process which tries to evaluate the performance of an individual

working in the organization.
Appraisals are arranged periodically within a definite plan.
It is a continuous process in every large organization.
PURPOSE
Performance appraisal aims at attaining the different purpose they are
To create and maintain a satisfactory level of performance.
To contribute to the employee growth and development through self training and
management development programs.
To help the superiors to have a proper understanding about their subordinate.
To guide job change with the help of yearly ranking system.
To facilitate fair and equitable compensation based on performance.
To facilitate for testing and validating selection tests interview techniques through
comparing their scores with performance appraisal ranks.
TECHNIQUE OF PERFORMANCE APPRAISAL AT IPCL

Key Results Areas (KRA)
In IPCL, department wise performance and knowledge about various aspects

needed in the department is effectively checked.
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Here there are two types of KRAS

o
Team KRA
Individual KRA
The KRA carries 1000 points which is marked by 10 options been provided.
1-5 options is the team KRA- it is very particular to the department, it varies
department wise. This carries 400 marks.
6&7 options are similar for all departments which involves the performance diary
and special projects. This carries 400 marks with 200 marks for each.
8-10 options are the individual KRA which involves IR, Safety etc. this carries 200
marks.
According to the marks gained the rating is done department wise. The grades
are given as under:
EXCELLENT
VERY GOOD
GOOD
AVERAGE
BELOW AVERAGE
According to the ratings individual is given some incentive allowances once in a

year as per the position of the individual.
Even some promotions can be expected.
The time period of KRA rating is April - march.
The rating is termed as OMEGA rating.
MOTIVATION
Various benefits are provided to the employees for motivating them. These are as listed
below:
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Uniform with shoes.
Medical facilities- self, wife and two children( group medical policy)
Individual accident policy (Group personal accident policy)
Ten paid public holidays where meals are provided for the company with sweets
Sports activities conducted with prizes.
Flag hoisting on Independence day and Republic day.
Planting
Polio, Blood camp, Skin camp
Summer Vivah
Hospital development
FOR NON- SUPERVISORS
Attendance incentive
Production incentive
Top ten attendance performance awarded
RECRUITMENT AND SELECTION

Recruitment is the process of finding and attracting capable applicants for employment.
The process begins, when new recruits are sought and ends when their applications are
76
submitted. Recruitment is concerned with the identification of sources from where the
personnel can be employed and motivating them to offer themselves for employment.
Recruitment is the process concerned with the identification of possible sources of
human resource supply and tapping those sources.
The Company hires workers on contract basis. In case of staff, whenever any vacancy
is created in the company, first of all the company tries to fill it by promoting the
employees within the company, or otherwise they use the external source for
recruitment. For the external recruitment, an application is submitted to the HO
(Mumbai) by the department head and if HO approves it the company starts their
selection process.
SOURCES FOR RECRUITMENT
Internal source
External source
---- Promotion
---- Advertisement
---- Transfer
---- Labour contractors
INTERNAL SOURCE
The company fills up the vacancy by employing the existing employee for the
required post through promotion or transfering them from other units.
77
EXTERNAL SOURCE
The company recruits and selects the employee from external sources that is
through advertisement in the newspapers and hiring employees through
contractors.
PROCESS
Personal requisition
Application pool
Screening of applications
Interview
Approval from HO (Head Office)
Placement
PERSONNEL REQUISITIONS
The recruitment process starts when the personnel department receives the
requisition for recruitment from any department of the company. It contains all the
78
details about the position to be filled, qualification required from the candidate,
terms & conditions of employment, & time by which the candidate has to appear
for the appointment.
APPLICATION POOL
The process starts with the collection of various applications. All the applications
are collected by the company on the basis of criteria placed by them.
SCREENING OF APPLICATIONS
Screening is done to weed out totally undesirable or unqualified candidates at the
outset. The applications received from the applicants contain information
regarding their personal bio-data, achievements, experience etc. Based on the
screening of applications only those candidates are called for further process of
selection.
INTERVIEW
After screening of applicants is done, the company conducts a personal interview
of the applicants to find out overall suitability of candidates for the job. It also
provides opportunity to give relevant information about the organization to the
candidates
APPROVAL FROM HO
The applications of the selected candidate are send to HO (Mumbai), who is then
approved by them. The head office further decides the authority, responsibility &
pay of the candidate.
PLACEMENT
After all the procedure is completed, initially the candidates are placed on the job
on probation basis for six months. During this period, they are observed deeply,
and when they complete this period successfully, they become the permanent
employees of the organization.
79
PROBATION PERIOD/ TRAINING PERIOD

Probation/Training is the trial period, which a new employee has to undergo
before the individual & the organization accept each other. The various terms and
conditions are applicable during the Probationary/ Training period.
1.The Probationer/ Trainer is entitled to get the salary as per the grade in which
he is appointed.
2. The training period is of one year and Probation period is of six months, which
may be subjected to extension of three months if the performance of the
employee is not found satisfactory. However, on successful completion of the
probationary period or training period, the employee is confirmed in the
services of the company or comes to probation as the case may be;
3.The Probationers/ Trainees services may be terminated by the company at the
end of the probationary/ Training period without assigning any reason thereof;
4.The Probationary/ Trainees will be subject to the standing orders & rules and
regulations of the company , which are in force and framed by the company
from time to time;
5.The Probationary /Trainees has to work in any department /office / branch
office as required by the company;
6.The appointment of the probationer /Trainer is subject to his medical fitness
certified by the Companys Chief Medical Officer.
FINALIZATION
Once the candidate has gone though the training and the probation period he is
finally chosen for the work with the necessary incentives to be provided
TRAINING
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Every organization needs to have well trained and experienced people to perform the
activities that have to be done. If the current or potential job occupant can meet this
requirement, training is not important. But when this is not the case, it is necessary to
raise the skill levels and increase the versatility and adaptability of employees.
Inadequate job performance or a decline in productivity or changes resulting out of jobs
redesigning or a technological breakthrough requires some types of training &
developmental efforts. As the job becomes more complex, the importance of employee
development also increases. In a rapidly changing environment, employee training &
development is not only an activity that is desirable but also an activity that an
organization must commit resources to if it is to maintain a viable and knowledgeable
work force. Training & development constitute an on-going process in any organization.
IMPORTANCE OF TRAINING
Training Programs helps to remove the Performance deficiencies in employees. This is
particularly true in case of
1) The deficiency is caused by a lack of ability rather than lack of motivation to perform
2) The individual involved have the aptitude and motivation needed to learn to do the
job better
3) Supervisors & Peers are supportive of the desired behavior
There is a greater stability, flexibility and capacity for growth in an organization. Training
contributes to employee stability in at least two ways. Employees become efficient after
undergoing training. Efficient employees contribute to the growth of the organization.
Growth renders stability to the work force. Training makes employee versatile in all jobs.
Flexibility is therefore assured. Accidents scrap & damage to machinery and equipment
can be avoided or minimized through training. Even dissatisfaction, complaints,
absenteeism and turnover can be reduced if employees are trained well.
Hence, Training is an investment in HR with a promise of better returns in
future.
The Entire Training Process can be outlined as below:
INDIAN Organizational
PETROCHEMICALS COOPERATION LIMITED
Objectives &
Strategies
81
Assessment of
Training Needs
Establishment of
Training Goals
Devising Training
Programs
Implementation of
Training Programme
Evaluation of
Results
TRAINING PROCESS FLOWCHART
82
TOP
MANAGEMENT/
TRAINING NEED
IDENTIFICATION
EXTERNAL
DEPARTMENTA
L HEAD/ T & D
HEAD
FINALISING
THE MODE
OF
TRAINING
INHOUSE
T & D HEAD
TRAINER
PREPARATION OF TRAINING
CALENDARS
FINALISATION OF DATE, TIME,

FACULTY, VENUE, TRG.
CONTENT
IMPARTING TRAINING TO THE
TRAINEE
T & D OFFICER
SAME TO BE PUT TO HEAD HR / SITE CHIEF

FOR APPROVAL
BASED ON WHICH TRAINING CALENDER
WOULD BE PREPARED
FINALISATION OF AGENCY & SENDING THE

TRAINEE FOR TRAINING PROGRAM
FEEDBACK FROM THE

TRAINEE
NOT EFFECTIVE
HOD/TRAINER
ON RECEIPT OF BROCHURES, IT IS SENT TO

CONCERNED HOD WHO WOULD INDICATE
THE EXPECTATIONS
REVIEWING
EFFECTIVEN
ESS OF
TRAINING
ANALYSE FOR THE FAILURE & RECORD

THE DETAILS
TAKE CORRECTIVE ACTION
EFFECTIVE
T & D OFFICER
RECORD THE DETAILS IN THE

COMPUTER SOFTWARE
The Training Needs Can Broadly Be Classified Under Following Heads :

1)
Induction Training
83
2)
Mandatory Training
3)
Competency Assessment Training (SDM)
4)
Need Based Training
PURPOSE OF TRAINING
Development of all cadres
Career Progression
Succession Planning
Multi-discipline skills
Own discipline, Cross functional, soft and conceptual skills
Building expertise and multiplying it across company : Uniformity in practices

across sites.
To bridge losses due to
Retirement
Attrition
To meet additional demands as a result of growth of the company.
KSA
K Knowledge -
S Skill -
A Attributes -
requires to know, to perform
has to be proficient in, to perform .

soft skills / conceptual & behavioural traits, to perform
KSAs ( for a Job/Position ) are classified as
Own Discipline / Function created for the Job / Position
Cross Discipline borrowed from KSAs created for the other disciplines
Soft Skills borrowed from a common pool created by HR
HSEF Related relevant for HO ? ?
Location specific - created for the Job / Position
Others
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INTRODUCTION
Marketing is typically seen as the task of creating, promoting & delivering goods &
services to consumers & business. It is a societal process by which individuals & groups
obtain what they need & want, through creating, offering & freely exchanging products &
services of values with others. Business plans are becoming more customer &
competitor oriented, better reasoned & more realistic than in the past. To be successful
the firm needs to look for competitive advantages beyond its own operations into the
value chains of its suppliers distributors & customers.
IPCL has an extensive network of sales offices, representatives, and distributors that
are constantly striving to reaffirm the commitment of every sale and complete support
thereafter. They share with their customers, the enormous wealth of their experience
and knowledge gained over the years. The company not only supports their present, but
also helps to build their future in the business
The companys service centers are equipped with the modern techniques and
procedures for total customer support. Every stage of production is being closely
monitored and tested ensuring consistent quality to their customers.
OBJECTIVES OF MARKETING DEPARTMENT
Marketing department not only deals with retaining the existing one, but also attracting
new customers. The marketing objectives are as follows: To increase awareness among the customer about the product.
To provide quick and widely available service to their customers.
To understand the service output levels desired by the target customers.
To initiate and respond to price change.
To gather information about present market situation and measure market demand.
85
MARKETING PROCESS
Marketing department at the end of every month gets the PTY requirement from each
region and thereafter find pout the best possible product mix/sales mix to be run for
given PTY Machine plan. Monthly production plan is prepared by marketing head
considering customer order in hand, pending order and future requirements.
PRICING POLICY
Pricing policy is been set by the producer, to establish a price list and schedule of
discounts and allowance, that is equitable and sufficient to the customers. The pricing
policy of IPCL is set up by its Head Office.
TURNOVER OF THE COMPANY

Although the company faced heavy pressure of stiff competition from national and
international quarters, the sales of the company continued to register growth.
Production at the newly set up plant at Silvassa grew substantially, to compensate for
the sagging performance at the manufacturing plant in Mumbai. The annual turnover of
IPCL is 1000 crores and above.
EXPORTS
The exports of the company grew by 10% as compare to the pervious year, however the
management is pursuing much higher goals to achieve exponential growths in the
coming years.
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EXPORT YIELD %
SALES AND DISTRIBUTION

Sales department and the warehouse department are both always interlinked whenever
the warehouse is used for the storing of finished goods.
Order generation process in the company
The sales representatives, marketers, and other employees of the head office of the
company collect the orders from the market and pass those orders to the sales
and distribution department.
The sales and distribution department notifies the specifications made by the
customer and checks the availability of the stocks as per the specifications and
then finally decides the date of delivery.
87
This delivery date is then conveyed to the customer, and if accepted then the order
is then recorded for completion within the delivery date accepted.
ACTIVITIES OF THE SALES AND DISTRIBUTION DEPARTMENT
The sales and distribution department looks upon to deliver the goods to the goods
to the customer on the promised due date.
The sales and distribution department calculated the stock to be manufactured or
the stock to be generated from the pending orders and thus plans for future
production cycles to be carried out.
It checks the deliver dates getting near and asks the warehouse department to pass
on this order quantity of the goods to sales department.
These goods are then prepared to be loaded in to the vehicle through it has to be
transported to the customer or the delivery site, whatever may be the case.
The transportation vehicle is decided after estimating and considering the quantity,
weight, and size of the goods.
A local transporters vehicle may be chosen if the quantity is small enough to hire a
full vehicle.
But if the quantity or size is large enough that a vehicle is required to be hired then a
carrier or a container is chosen.
The loading supervisors are responsible for the proper and safer loading of the
goods in the vehicle.
SUMMARY
The sales and distribution department looks upon supplying the goods
(a)
Demanded by the customers if its consumer goods.
(b)
Demanded by the zonal distribution centers if the company has a wider

market
88
(c)
Demanded by the further processing if its linked to a sub assembly storing

center.
It reports the production planning department for the stock required to be produced
in the near future to meet the customer needs at the promised date of delivery and
to maintain the planned level of stock in the warehouse.
INTRODUCTION
Research and Development means large-scale investment to support innovative
ideas. R&D Laboratories attach great importance to the smooth integration of quality
testing, production methods and packaging systems of newly introduced products. R &
D activities are monitored by the new version of ISO 9001 : 2000 quality management
system.
Research and Development centre of IPCL is playing a key role in maintaining its
technological
leadership
by
quickly
responding
to
customer
and
market.
It is manned by a larger team of highly qualified and experienced technocrats. They

have well equipped library facilities to update reference material, periodicals, current
journals and standards of Indian and International origin.
RESEARCH & TECHNOLOGY
IPCL considers R&T as an integral part of its strategic management. Its R&D Center, at
Vadodara, established even before commencement of commercial operation, is a
forerunner in petrochemical research. The vision of R&T is "...from licensing technology
to developing technology, from being an intellectual property user to intellectual property
creator" through Research in Hydrocarbon chain, Polymer and Hybrid Material
Applications and, Technology Development. In order to cater the needs of Research &
Technology, several areas of research encompass Polymers and Materials Sciences,
Catalysts and Adsorbents, Organic Chemicals, Chemical Engineering and Process
Development, Applied Biology and Environmental Science, Chemical and Analytical
Spectroscopy. The center also has pilot plants for Polyolefins and a demonstration gas
89
cracker. IPCL R&D is widely linked with the eight Manufacturing Sites and seven
Business Groups of IPCL and Reliance.
FUNCTION
To develop specialist yarn
Continuous tight spot
Lycra covered yarn
Mlange
Wool like
Slub
Bi shrinkage yarn
To conduct various trials
POY performance for new merge
Core splash study of POY bottom
Different oil trials
Running in of different discs
AWARDS/RECOGNITION/ACHIEVEMENTS:
IPCL R&D Centre has won several prestigious National Awards like ICMA,
VASVIK, DSIR, DGTD, DSIR, and Golden Peacock Award
RESEARCH & DEVELOPMENT
Evolution of POY:
In this process they do research with their H/w and match POY with H/W
parameters. The best match is found, then they order required amount of raw
materials from market for production purpose.
90
New PTY Product Development:

It means they take input as POY and convert into PTY and check for whether it Is
suitable for customers or not
New Process Developments:

This phase include adding extra features to pilot machines. They check the
development made to H/w machines is efficient for production or not. The two terms
associated with Research and Development is as follow-:
1) Texturing: It is a process when you insert Bulk in yarn with the help of heaters and
twisting units
2) Twisting: It is a process to strengthen a textured yarn to work properly in future
process.
3) Give support to Reliance manufacturing site:
It takes POY from various
manufacturing plant and measure its various parameter regarding its quality and
sent the report to the concerned manufacturing plant. Thus it is also the R&D
department for various Reliance plant.
4) Troubleshooting: It has to troubleshoot every problem coming in machine and
process. On each side of machine there are heaters the short heaters on one side
and V type and M type heaters on other sides.
The various machines related to R & D is:
SDS-700 (Super Draw set)
Barmag FK -6-1000
Murata -33H-Crimper
Barmag FK-6-L-900
Reiter Goal
91
Finally the work of R & D Department is generating sample package for all machines.
INTRODUCTION
Finance is regarded as the life blood of business. Financial management is concerned
with the accumulation, classification, interpretation and supply of accounting and other
information, which are helpful to management for decision making. It also provides
information to the shareholders, creditors, government regarding the financial position,
overall progress, strength, and weakness of an enterprise. It not only deals with
procurement of funds in business but also its effective utilization.
IPCL finance department is handled over by the HO in Mumbai. The finance head of
Silvassa unit looks after the financial transactions of local parties, budget planning
accounting of purchase and sales, payment of salary and finance of day to day
expenses.
FUNCTIONS
Supervision of cash receipts and payments.
Safeguarding of cash balance, securities, insurance policies and other valuable

papers.
Measuring the economic activity of the enterprise as a whole.
Taking care of the mechanical duties of new outside financing.
Record keeping and reporting.
Providing information regarding profit and loss to the owners and outsiders.
Providing information regarding financial position of the company at the end of

the year.
92
Review and control decisions to commit or recommit funds to new or ongoing

uses.
SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The accounts have been prepared under the historical cost convention in
accordance with the generally accepted accounting principles and provisions of
the Companies Act, 1956.
USE OF ESTIMATES
Initially, the company prepares the financial statement on the basis of estimations
and assumptions, that affects the reported amount of assets and liabilities, revenue
and expenses. Afterwards the difference between the actual expenses and
estimates are recognized.
FIXED ASSETS AND DEPRECIATION

Fixed assets are stated at cost of acquisition including expenditure incurred during
construction/erection period less accumulated depreciation. Depreciation is
provided on SLM at the rates specified in schedule XIV of the companies Act,
1956.
LEASES:Operating lease payments are recognized on straight line basis over the lease
term.
INVESTMENTS
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Investments are for long term & valued at cost of acquisition. Provision is made for
depletion in market value of investments.
INVENTORIES
Stores, Spares, Raw-Material, and Packing Materials are valued at cost.

While finished goods and work-in progress are valued at lower of cost and net
realizable value.
The cost of Raw-materials, Stores, Spares, and Packing Materials is

determined on FIFO basis. While cost of Finished Goods and Work-InProgress is determined by considering materials, labour and other related
direct expenses.
RESEARCH & DEVELOPMENT

Research & development expenditure of revenue nature is written off in the year in
which it is incurred and expenditure of capital nature is included in fixed assets and
depreciation is provided on such assets as applicable.
RETIREMENT BENEFITS:Retirement benefits as per service rules of the company i.e. Gratuity, contribution
to provident fund, leave encashment are accounted on accrual basis.
FOREIGN CURRENCY TRANSACTION:Transactions arising in foreign currencies during the year are recorded at the
exchange rates prevailing on the date of the transactions. Foreign currency Assets
and Liabilities are converted into Rupee, equivalent at the exchange rates
prevailing at the date of the Balance Sheet.
CUSTOMS DUTY & EXCISE DUTY:-
94
Custom duty & Excise Duty are accounted on the basis of both payments made in
respect of goods cleared as well as on provision made for goods lying in bonded
warehouse.
INCOME TAXES:Provision is made for Income Tax liability estimated to arise on the results for the
year at the current rate of tax in accordance with the Income Tax Act, 1961.
DEFERRED TAX
Deferred tax arises when the actual tax consequence of a particular transaction
(tax payable or recoverable) arises in a different period from the period in which
the transaction itself is included in the financial statements.
These differences are referred to in FRS 19, Deferred Tax as timing differences.
Since taxation is payable on profits (or gains) less losses, FRS 19 adopts the
approach that classifies differences between the gains and losses that are
recognised in the financial statements and the gains and losses that are
recognised for tax purposes into two types:
Permanent differences - one-off differences between results for accounting
purposes and taxable income, caused by certain items not being taxable /
allowable. Such differences only impact on the taxation computation of one
period.
Timing differences - defined above.
TURNOVER
Turnover comprise sale of goods, net of trade discount and includes excise duty and sales tax.
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EXCISE DEPARTMENT
Central Excise is a tax on act of manufacture or production, while sales tax is a tax on
act of sale and for custom duty is a tax on import of goods within the custom barrier.
Excise is collected, on the goods manufactured or produced, at the time of their removal
from the factory for administrative convenience. Excise is a duty on production or
manufacture of goods. It is a tax levied on manufacture of goods and the liability to pay
excise duty arises immediately on manufacture or production of goods. General Excise
is a central subject; therefore central government is responsible for its levy & collection
in India. However, liquor & narcotics are excluded from purview of central government
as the same are covered by state excise laws in India.
With effect from 9-7-2004, an education cess @2% of the aggregate duties of custom
and excise is leviable. However the cess amount paid on inputs will be available as
credit for paying education cess on final excisable products as provided for in the cenvat
credit rules. Education cess being a new levy is not leviable on excisable goods
manufactured prior to imposition of cess but cleared after such imposition. If goods fully
exempted from duty or are changeable to nil duty or are cleared without payment of
duty under prescribed procedure, such as clearance under bond, no cess would be
leviable. Duties/cesses , formally called duties of excise but collected by a department
96
other than department of revenue should not be taken into account for calculation of
education cess.
The person requiring registration of excise are: 1) Every manufacturer of dutiable excisable goods.
2) First and second stage dealers (including manufacturers depots and importers)
desiring to issue cenvatable invoices.
3) Persons holding warehouse for storing non-duty paid goods.
4) Person who obtains excisable goods for availing and use based exemption.
5) Exporter manufacturer under rebate/bond procedure exports oriented units and EPZ
units, which have interaction with the domestic economy.
6) Person who gets yarns, fabrics, readymade garments etc. manufactured on job work
rule 12B.
Separate registration is required in respect of separate premises (factory, depot,
goodown etc) except in case where or two or more premises are actually part of same
factory (where premises are inter-linked) but are segregated by public road, canal or
railway line. In the case of textiles, a single registration will do for all the premises listed
there in. Further several manufacturers owning machinery under a common shed or in
common premises will be treated as a separate factory. Each for their respective
machinery and there will be no dubbing of their production/clearance.
Excise duties are by and large assessed on self-assessment basis. Before central
excise duty can be imposed on any article it must satisfy two basic conditions
The article should be Goods.It should have come into existence as a result of
manufacturer if either of the above two conditions is not satisfied; central excise duty
cannot be levied.
Excisable Goods means goods specified in the schedule to the Central Tariff Act,
1985 as being subject to a duty of excise. The basic conditions to be satisfied by any
goods to be called excisable goods are:
The goods must be movable.

97
The goods must be marketable i.e. saleable in the market. Actual sale of
goods in the market is not necessary because excise duty is chargeable on
manufacture and not on sales.
The goods must be specified in the Central Excise Tariff Act
After obtaining the registration certificate and before commencement of manufacturing

activities, the manufacturer must intimate to the excise authorities, the intended date of
commencement of manufacturing operations.The manufacturer is required to intimate
the excise authorities, details of plant and machinery used to manufacture the product.
On completion of production, the finished goods must be kept in the bonded store room
specified in the application form. The goods can be removed from the store room only on
payment of duty or against modvat credit. In India, excise duty is levied in accordance
with the provisions of the Central Excise Act, 1944.
SERVICE TAX
Services are increasingly gaining importance in Indian economy as well as in tax
revenues and their importance cannot be undermined. Growing contribution makes
service sector conductive for mobilization of greater resources. The expert committee or
service tax headed by Dr. Govind Rao and suggested to bring in more services in under
service tax net. Dr. Vijay Kelkars task force also recommended that having
compressive tax base should facilitate implementation of service tax and that the
government should identify certain minimum services which are not subject to service
tax. Service tax was introduced for the first time in the year 1994 through the insertion of
chapter v in the Finance Act, 1994 and its scope has been gradually enlarged to cover
near about 100 types of services. The initial rate of tax was 50%, which was operation,
until 13th May 2003. However with effect from 14 th May 2003 the rate of service tax has
been increased to 8%. In the budget 2004-05 it was proposed to increase the service
tax from 8% to 10% and enacted from 10 th Sep 2004. And later in the last budget it was
proposed to increase from 10% to 12% and enacted from 18 th April, 2006.
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Service Tax is leviable on service in respect of which change of tax has been created
under the act. At the prescribed rate with effect from 1-4-05 a threshold limit of Rs
4Lakh has been prescribed upto which value of all taxable services provided by a
service provider during a financial year exempt from tax. For this purpose the taxable
services have been specifically defined. The act makes the person providing the
services to pay service tax in such manner and within such period as may be
prescribed. Provisions have been made for self assessment, rectification, revision,
appeals, penalties etc. as well as for registration of persons liable to pay tax. Credits of
service tax and excise duty is being extended across goods and services with effect
from 10-09-2004
SWOT ANALYSIS
STRENGTHS
It stands 1st in the world as private textile industry for texturising
The company is equipped with well qualified staff members and continuously
upgrades the quantity and quality of its human resources to handle large
business volumes and enhance competitiveness,
Strong and good reputation in international market
Higher quality goods
It has a good management and adequate system of internal controls to ensure

that all activities are monitored and controlled correctly.
Enjoys market leadership in USA and U.K
Advance ERP system sap R/3
WEAKNESS
High employee turn over (at lower level management)

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Higher centralization of authority (head office)
Internal disputes and lack of co ordination between departments
Lack of proper communication with management due to improper controls
Difficult to mange the contract labour and their problems
OPPORTUNITIES
Can work to achieve domestic market share
Easy availability of finance
High rate of growth due to expansion undergoing at the company
Can make optimum unitization of machines
THREATS
Risk of rise in raw material price
Devaluation of Indian rupees
Competition from international players and out of growth in a rapid globalizing

market
Due to liberalization it creates higher and competitive market
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CHARTS
101
TEXTURISING MACHINES (Nos.)
QUANTITY PRODUCED - KTA
102
MACHINE EFFICIENCY %
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PROJECT ON PROFIT PLANNING & BUDGETORY CONTROL

Abstract
Profit Planning & Budgetary Control is an important short term tool of management
planning & control. Preparation of budget helps to increase the bottom line of the
organization. It helps to prepare the budget year after year. The main purpose of
budgeting activity is to show the future position of the business. Hence it is very
necessary to have a thorough knowledge of the same.
The report mainly consists of the procedure followed by the company to prepare the
Profitability Budget, Classification of Master Budget & comparison of the actual output
with that of the budgeted & thereby determining the causes of the deviations &
variances.
Working at IPCL, a subsidiary of Reliance Industries Ltd. the number one Indian
company in terms of profit & capitalization is a wonderful experience. The company is
no behind than other multinational companies in terms of using the latest technology.
IPCL uses SAP for all its operation, which makes the system organized, fast & very user
friendly.
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INTRODUCTION TO THE STUDY

Background to the study
All enterprise requires some planning for the future. A business enterprise would be
interested in planning for the activities that would help them to achieve their objectives &
goals. In the case of small business enterprise owned & managed by the owner, the
planning may be based on the intuitive foresight based on the business acumen of the
proprietor. As an enterprise grows & becomes more complex, the planning exercise may
have to be carried out on a more scientific basis rather than on intuitive gut feeling of an
individual. Since the total organizational task is performed by several managers, each
one being responsible for an assigned sub task, it becomes the responsibility center. It
can be expressed not only in physical units but also in terms of monetary value. Both
formulated together can be used as a basis for the comparison of actual performance
with the planned performance & can thus help in implementation of corrective actions.
Hence, it can be used as an instrument of control.
Profit Planning is essentially a managerial process concerned with planning,
coordination & control. The budget is essentially an action plan that covers all aspects
of the operations of an enterprise for a definite future period of time. A budget prepared
for one year is also sometimes referred to as annual action plan, & it is a formal
expression of the objectives, goals & plans as evolved in advance by the management
for the enterprise as a whole as well as fro each of its responsibility center.
A firm should be managed effectively & efficiently in order to achieve its objective in
more prominent way & to continually generate business & returns for its stakeholders.
This implies that the firm should be able to achieve its objective by minimizing the use of
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resources. The process of managing is facilitated when management charts its future
course of action in advance & takes decision in a professional manner, utilizing the
individual & group efforts in a coordinated & rational manner. One systematic approach
for attaining effective management performance is Financial Planning & Profit
Planning. Financial planning indicates a firms growth performance, investments &
requirements of funds during a given period of time, usually three to five years. It
includes preparation of profit & loss account, balance sheet etc. Budgeting or profit
planning is a detailed plan of action during a period of one year or less.
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STATEMENT OF THE PROBLEM

Profit Planning & Budgetary Control
OBJECTIVES OF THE STUDY

The main objective of this study is to get a practical exposure of the Profit Planning
Process & Budgetary Control in a manufacturing company & there by suggest way to
improve them for the achievement of goals in most optimal comportment.
Other objectives are
To know how budgets are helpful in long term decision making & short term
operations.
Understand budget variance analysis
To study the responsibilities taken by the heads of different responsibility centers
at the time of budgetary variance
METHODOLOGY
Nature of the project is Descriptive type. The project involves studying the procedures
for undertaking the Profit Planning & Budgetary Control techniques adopted by the
company.
Data collection
a) Primary Method
Observation
Conversation with the concerned personnel.

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b) Secondary Method
Company Journal.
LITERATURE REVIEW
Profit planning or budget is a comprehensive statement of intensions, expressed in
financial terms, for the operations of the firm for a short term period. It is a plan of the
firms expectations & it is used as a basis for measuring & controlling the actual
performance of the managers & their units.
No system of planning can be successful without having an effective and efficient
system of control. Budgeting is closely connected with control. The exercise of control in
the organization with the help of budgets is known as budgetary control. The process of
budgetary control includes:
1. Preparation of various budgets.
2. Continuous comparison of actual performance with budgetary performance.
3. Revision of budgets in the light of changed circumstances.
A system of budgetary control should not become rigid. There should be enough scope
of flexibility to provide for individual initiative and drive. Budgetary control is an important
device for making the organization more efficient on all fronts. It is an important tool for
controlling costs and achieving the overall objectives.
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Conceptual Framework for Profit Planning Program
There must be commitments by the top management to the broad concept of

profit planning & control & a sophisticated understanding of its implications &
operations.
The characteristics of the enterprise & the environment in which it operates including
the controllable & non controllable variable, must be identified & evaluated so relative
decision can be taken that are realistic & practical
There should be an evaluation of organizational structure & assignment of managerial

responsibilities & implementation of changes deemed necessary.
There must be an evaluation & reorganization of the accounting system to ensure that it
is tailored to the organizational responsibilities so that it can provide data particularly
useful for planning & control purpose
A policy determination must be made about the time dimensions to be used for profit
planning & control purpose
A program of budget education should be developed to inform management at all levels

about,
Its purpose
Manner in which it will operate
Responsibility of each level of management
The way in which performance evaluation is going to be performed
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PROFIT PLANNING AT IPCL

In IPCL, Profit Planning is prepared on the Marginal Cost Concept. The budgetary
preparation starts generally in the month of December for the next financial year. Here
the business sector forecast their targeted marketing capacity for the financial year
based on the trend, pattern and demand of the preceding financial year. But here they
always keep in mind the changing circumstances of the Market parameters for deciding
and selecting their quantifiable business forecast. On the basis of captioned quantifiable
details the business machine running program is set on the basis of tenure and type of
production to be produced for the particular period.
Quantifiable business forecast is examined on the basis of available resources like
Machine
Material
Labour
Utility Resources
Availability of Power
Other prevailing rules of the law along with any limiting factor which is treated as
constraints regarding the determination of production quantum of various denies and
types.
In case of ipcl constraints of limiting factors is the utility service like availability of air
which is required for the manufacturing of intermingled yarn better known as rotoyarn.
For the production parameters total plant machine utilization & machine efficiency for
budget production are as 98% & 97% respectively with 1 st quality of 95 to 96% is the
target.
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BUDGET PREPARATION PROCESS

FORMULATING
PRICING POLICY
SALES FORECAST
SALES QUANTITY BUDGET
PRODUCTION BUDGET
DIRECT MATERIAL
BUDGET
DIRECT LABOUR
BUDGET
FACTORY
OVERHEAD BUDGET
STORES, SPARES & CONSUMABLES
GENERAL ADMINISTRATIVE EXPENSE BUDGET
SELLING & DISTRIBUTION EXPENSE
RESEARCH & PRODUCT DEVELOPMENT
MARKETING & DEVELOPMENT EXPENSE
BUDGETED FINANCIAL STATEMENTS

1) INCOME STATEMENTS
2) BALANCE SHEET
3) CASH FLOW STATEMENT ETC.
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FEEDBACK MECHANISM
WHICH HELPS TO FIND
DEVIATION IF ANY &
HELP TO FORMULATE
NEXT BUDGET
IPCL prepares a master budget which summarizes the various functioned budgets. It is
a summary plan for overall activities of the organization for a definite future period. The
financial budget is a budget of income or expenditure appropriate to or the responsibility
of a function. Each functional department of the organization prepares its own budget &
these functional budgets are then integrated into a master budget.
Profit Planning activities carried on by IPCL starts with the preparation of the sales
budget in which forecasting of sales is done by the Marketing Department or by the top
level marketing team, considering the demand of the product, marketing efforts &
external environment which effects the sales of the business.
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SALES BUDGET
The preparation of the sales budget is usually the responsibility of the marketing
manager & starts with the sales planning exercise. Sales planning involves not only
developing projections of the expected sales volume in physical & monetary terms but
also the associated selling costs. Hence it encompasses both revenue as well as cost
components.
The sales plan is intimately related firstly to the objectives of the enterprise that provide
broad goals around which the sales plan is developed & secondly, to the managerial
strategies in the long & short run that provide bases for identifying markets/products.
The sales plan is based on a sales forecast that gives the projections of the customer
demands under a certain set of assumptions.
The marketing team carries on sales budget at IPCL. The team will estimate the
quantity which they can sell both domestically & internationally within a year. At the time
of estimating the total sales, records of the past sales, future trends of the market,
demand of the particular product, growth trends in the volume of sales, competition,
economic condition etc is taken into consideration.
Marketing team on the basis of their market research determines which product is in
demand & which to be produced & what period of time. Here sales ids determine in
terms of volume & value for the specific period.
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The basic format of monthly sales budget is as follows:

Denier
For the month of Jan

PTY Sales Ex
Value
Rate
fact
(Rs)
(Rs)
with
For the month of Feb

Sales Ex Rate (Rs)
Value (Rs)
excise
Roto
Texlene
Crimp
Total
Correspondingly, in the same way sales budget is prepared for all the remaining
months. Thus likewise the whole year sales budget is prepared.
The preparation of sales budget has many advantages for the organization like
It helps to compare the actual performance with the target for the process of
overall control of sales performance.
It helps in planning & control of production.
It helps in purchase of raw materials & in the management of inventories.
It helps to plan distribution & warehousing arrangement.
It helps to project the working capital requirement of the enterprise.
PRICING POLICY
Pricing decision is one of the important policies which the organization while fixing a
price has to keep in mind the cost of the product which includes the variable & fixed cost
& secondly the margin of the company which ultimately gives the bottom line. Every
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organizations has its own pricing decision policy. IPCL has also adopted a different style
of pricing decision.
The pricing policy is undertaken after the process of determining the sales both in value
& volume terms. The company gives eminence on reducing the variable cost year after
year because that will increase the profit of the company.
S VC = F + P
Where,
S = Sales (in value)
VC = Variable Cost
F = Fixed Cost
P = Profit
In a situation when the firm cannot increase its selling price or the sales become s
stagnant because of the immense competition in the market, there is an increase in per
unit Variable Cost & as a result price of the product may tend to increase. If such
situation prevails results will be decrease in the profits of the company. The firm carrying
on its business will never like to reduce the profits. Thus it will strive to control their
variable cost.
On the other hand fixed cost remains same & after sometime it tends to increase but
there is very less probability that fixed cost can be reduced.
Thus F&A department at IPCL works on budget to control its variable costs & increase
sales quantity which will result in higher profits for the organization.
Price fixed on the basis of the pricing policy followed by ipcl is normally as follows:
Price of PTY = cost of sales + margin + commission + special discount
Where;
Cost of sales = cost of production + cost incurred on activities related to sales,

distribution & administration.
Margin = fixed on the basis of company policy.

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Commission = purely based on marketing strategy; currently it is 1.5%
Special discount = generally used to promote new product or to enter new

market
As PTY is an industrial product its selling price will be same for the customers within the
boundaries of the country.
Cost of sales includes the following items;
1. Cost of production
i) Raw materials
ADD
ii) Support activities
ADD
2. Miscellaneous
ADD
3.Selling & Distribution
Direct Material
Direct Labour
Direct Overheads
Directly
related
to
Indirect Material
Indirect Labour
Indirect Overhead
Not directly related to
production
production
Other expenses
Marketing expenses
PRODUCTION BUDGET
The production budget specifies the planned quantity of goods to be manufactured
during the budget period. To develop the production budget, the first step is to establish
policies for inventory levels. The next step is to plan the total quantity of each product
that is to be manufactured during the budget period. The third step is to schedule this
production by interim periods. A complete production plan should show budget data
classified by:
a) Products to be manufactured
b) Interim time periods &
c) Activities of each responsibility enter in the manufacturing process.
The production budget is the principal budget, 3 other principal budgets relevant to
manufacturing are
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a) The Direct material and purchased components budget, which specifies the
planned material and components
b) The Labour budget, which shows the planned quantity and cost of direct Labour
&
c) The Manufacturing expense or factory overhead budget, which includes the
plans for all factory costs other than direct material and Labour.
The following chart shows the planning activities from marketing to production plan,
To plan production effectively, the manufacturing manager must develop the information
about the manufacturing operations necessary for each product. The manager should
develop information about the uses and output capacities of each manufacturing
department. The managers must provide historical data about production quantities,
costs and the availability of resources.
DIRECT MATERIAL BUDGET

A comprehensive direct material budget includes planning & controlling raw materials &
components used in the manufacturing of finished products. In this case, the
coordination to be planned and controlled is among
1) Production requirement for materials and parts,
2) Raw material and parts inventory levels and
3) Purchases of raw material
When the required quantities of each product to be manufactured are specified in the
production plan, the next step in planning the manufacturing program involves
consideration of the various production requirements and costs.
The raw materials and component parts budget:
To ensure that the appropriate amounts of raw materials and component parts will be on
hand at the time required and to plan for the costs of such material and parts, the
tactical short-term profit plan should include
1) A detailed budget that specifies the quantity and cost of such materials and parts
117
2) A related budget of materials and parts purchased. Planning raw materials and parts
usually requires the following points to be kept in mind:
a) Materials & Parts Budget
This budget specifies the planned quantities of each raw material & part required
for planned production. It should specify quantities of each raw material and part
by time, product and responsibility.
b) Materials & Parts Purchases Budget
The materials and parts budget specifies the quantities and timing of each raw
material and component part needed; therefore, a plan for purchases must be
developed. The purchases and parts budget specifies the planned quantities of
materials and parts to be purchased, the estimated cost and the required delivery
dates.
c) Materials & Parts Inventory Budget
The budget specifies the planned levels of raw materials and parts inventory in
terms of quantities and cost. The difference in units between the requirements as
specified in the materials budget and the purchases budget is shown as planned
increases or decreases in the materials and parts inventory budget.
d) Cost of Materials and Parts Used Budget
This budget specifies the planned cost of the materials and parts that will be
used in the production process.
PARTIALLY ORIENTED YARN

In IPCL, the main raw material is the (POY) Partially Oriented Yarn and the Antistatic
Oil. The basic data required to develop the materials budget is the volume of output
planned and the standard usage rate for each direct material. The data related to plan
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the volume of planned output are available from the production budget. Thus by
multiplying usage rates with the production budget data, they get the quantities of
materials required. The standard usage rates per unit of finished product are based on
technical parameters. However, they are also derived from past consumption records.
Antistatic Oil
AO is used in the form of lubricant to dissipate the static energy at the subsequent
processing yarn, at its subsequent processing stage of process operation passes
through high speed, which generates friction and to counteract the polyester
hydrophobia fever, antistatic oils are generally used.
In planning the materials budget, appropriate allowances are made for normal waste,
spoilage and scrap. Once the estimates of raw material requirements are prepared, a
purchase budget is prepared, specifying the quantities of each type of raw material to
be purchased, the timing of the purchases and the estimated costs of raw material
purchases. This is done keeping in view the change sin the inventory levels.
The basic data used to develop the materials budget is the volume of output planned
and the standard usage rate for each direct material. The data related to plan volume of
output is available from the production budget. Thus, by multiplying usage rates with the
production budget data, they get the quantities of materials required. The standard
usage rates per unit of finished products are based on technical parameters. However,
they also derive from past consumption records.
DIRECT LABOUR BUDGET

Effective planning & control of labour costs are essential ingredients in an overall
program of profit planning & control. Labour costs include all expenditures for
employees from top executives down to unskilled laborers. Direct labour costs include
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the wages paid to employees who work directly on the companys product, while indirect
labour costs refer to the cost of other employees who do not work directly on the
product. In profit planning direct labour cost, it is necessary to estimate both the quantity
of labour that will be paid per hour for the various classes of labour.
Labour costs include all expenditures for employees: top executives, middle
management personnel, staff officers, supervisors, & unskilled &skilled employees.
Labour generally is classified as direct or indirect. Direct labour cost includes the wages
paid to employees who work directly on specific productive output. As with direct
material costs labour cost that can be directly traced to specific production are defined
as direct, indirect labour involves all other labour costs, such as supervisory, salaries &
wages paid to toolmakers, repair personnel, storekeepers etc. Direct material & direct
labour costs are frequently referred to collectively as the prime costs of the product.
The primary reason for using a separate direct labour budget is to provide planning data
about the amount of direct labour required, number of direct labour employees needed,
labour cost of each product unit, & cash flow requirements. Another purpose of the
direct labour budget is to establish a basis for control of direct labour. The responsibility
for preparing the direct labour budget should be assigned to the executive responsible
for the manufacturing function. The cost accounting & personnel departments provide
support & supplementary information.
Details about person on the pay scale of IPCL are as under:
i)
Staff - 253
ii)
Permanent employees 1137
iii)
Contract based employees 602 approx.
Basic guidelines for calculation of salary & wages are as followsExisting number of staff + addition if any required * average salary paid.
ADD
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Existing number of workers + addition if any required * average salary paid.

ADD
Existing number of contract workers + addition if any required * average salary paid
ADD
Expected future increments, bonus, and rewards for that year.
MANUFACTURING OVERHEAD BUDGET

The manufacturing overhead is that part of the total manufacturing expenses that are
not directly identifiable with specific products or jobs. This includes indirect material,
indirect labour including salaries expenses such as rent, rates & taxes, depreciation,
insurance, repairs & supplies. In all manufacturing situation there are two distinct types
of responsibility centres namely, producing departments & service departments. The
service departments provide service to producing departments & to other service
departments.
The budget is to be used as an instrument of control, expenses should be classified as
controllable & non- controllable items should not be reported as the responsibility of the
manager of responsibility centre.
Managers should view expense planning & control as necessary to maintain reasonable
expense levels to support the objectives & planned programs of the enterprise. Expense
planning should not focus on decreasing expenses, but rather on better utilization of
limited resources. Viewed in this light, expense planning & control may cause either
decreased or increase expenditure. Expense planning & control should focus on the
relationship between expenditures & the benefits derived for those expenditures. The
desired benefits should be viewed as goals & sufficient resources must be planned to
support the operating activities essential for their accomplishment.
Factory overheads include some major components like power consumption & cost and
packing material. They are discussed as below.
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Power consumption in IPCL, the monthly consumption of power is found by the product
(K) of power unit per machine, number of machines & number of days.
Power consumption & cost include the details like:
Main production machines (115 machines)
Pilot machines (5 machines)
Air conditioners
Compressors
Additional compressor
Miscellaneous like
Machine lightning
General lighting
Pump house
Fume extraction
Transformer loss
Feeder pillar & battery charges
Machine power consumption depends on machine speed & load factor, therefore higher
the speed, higher the consumption & vice versa. The power consumption is also
determined with the help of energy measurement meter.
Speed of the machine depends on the type of product produced on that machine. Also
machine are having there own speed limits i.e. if machine
SDS 700 is used, and then maximum speed is 700 MPM. For producing premium
quality product, machines are operated at low speed because of technical requirements
of the production of the material.
Power consumption for premium quality material is generally higher than that consumed
for other types of material. Power consumption for AC and A compressor is determined
on the basis of power load factor.
Power is also consumed in the existing robotized packaging module for packaging and
auto packaging system.
PACKING MATERIAL BUDGET

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In IPCL, goods are manufactured for the domestic as well as for export market. Here,
IPCL is the manufacturer, whereas RIL is the merchant exporter.
For the purpose of packing the finished goods, i.e., PTY & PTT, the materials include:
Plastic Tubes
Paper Tubes
Boxes
Polythene Bags
Bopp Tapes for strapping
The standard package weight consists of 4.25 kg to 4.50 kg /tube and weight of the
bobbins caries 2.5 kg to 4.5 kg. It is packed in three dimensional boxes, they are
Single Decker Boxes: It contains 6 packages or so called bobbins and the

weight of this box is 28kg. These types of boxes are purely used for
exports.
Double Decker Boxes: It contains 12 bobbins 54 kg, Domestic
Jumbo Boxes: 128 bobbins 600 kg, Export
Marketing team of the IPCL decides the style of packaging or the type of boxes for the
exports, thus they decide on the basis of the quantity produced. Statistical concept, i.e.
Matrix Design is used for the packing design.
The cost of packing material is determined as:
Total no. of boxes required + Cost of each box + Other Packing items + Total Wastage
STORES, SPARES & CONSUMABLES

Stores & spares budget is prepared on the basis of all departments. It gives the details
about the funds required to support the activities carried on mainly for the production
department & for the rest of the departments. The availability of funds & preventive
maintenance forecasting are the basis through which amounts or funds are allocated
within departments.
Funds are allocated on the following activities:
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Production (Texlene)
Utility
Power
Electrical
Instrumentation
Systems
Plant maintenance
Purchase administration
Finance & Accounts
Logistics
Excise
It contains mainly Variable Cost. Thus if variable costs increases & the selling price
remains same then contribution becomes low, which gives a wrong scenario of the
company.
In IPCL, while preparing stores & Spares budget, first & foremost, each & every
department has to give their total cost with justification for that particular cost.
Secondly, at the time of preparing functional budget there is a contingent budget too for
every department that is +1.5% to 2.5%
Thirdly, if the coast or the expenditure of the particular department increases more than
the contingency present, then there should be valid explanation given to support their
justification.
Lastly, they also compare the departments previous year & the current fiscal year
budget to see whether the expenditure is increasing or decreasing the reasons behind
it.While preparing the functional budgets every department have to give the explanation
for the needed expenditure. The budgetary team on the basis of their requirement
forecasts the actual expenditure & tries to lower down the expenses if possible. Thus,
they calculate every budget on per kg of production.
124
GENERAL ADMINISTRATION BUDGET

Administrative expenses are incurs for supervising & providing services to all the major
functions of business. As most of these expenses are fixed in nature, there is a general
feeling hat they are uncontrollable. However quite a large number of them are
discretionary & influenced by managerial decisions & policies, therefore a close watch is
necessary. An important characteristic of administrative costs is that the top
management incurs a part of such costs.
The general administrative costs are incurred by several responsibility centers such as
the legal departments, the public relations department, the personal department, the
controller department & the administration department. Each cost should be identified
with the related responsibility center & the manager incharge should formulate the
budget, which should be presented to the top management for approval. The
responsibility center in charge may base his budget on the specific plans or programs of
his department, past experience & anticipated changes in policies. Because of the fixed
nature of expenses, the past data serves a useful purpose in budgeting administrative
expenses
General administration budget consists of an expense which is not directly related to
production but which comes as a support service for any organization. They are
incurred in the responsibility centers that provide supervision of, & service to all the
functions of the enterprise
Some of the expenses taken into consideration at IPCL are as follows:
Bank charges
Audit fees
Guesthouse expenses
Entertainment expenses
Insurance
Canteen/ caterer expenses
House keeping expenses

125
Telephone expenses - both residential & office
Large portions of administration expenses are fixed rather than variable. Aside from
certain top management salaries, most administrative expenses are determined by
management decisions. It is common to find administrative expenses Top Heavy,
when measured by the volume of business done.
Each administrative expense should be directly identified with the responsibility center &
the center manager should be responsible for planning & controlling the expense. This
fundamental of expense control is especially important for administrative costs because
there is often a failure to pinpoint responsibility for expense of a general nature.
SELLING & DISTRIBUTION BUDGET

The selling & distribution costs includes all costs related to making the product available
to customers at their point of convenience, since several organizations, this element of
cost is a significant item. Careful planning & control is needed in this area. In developing
selling g& distribution expense budget, it is essential to relate sales effort with sales
results i.e. the expenses should be related to revenues. The selling expense budget will
include items such as travel & entertainment, telephone, salesmens salaries, stationary
& office supplies. It may be useful to classify these expenses as fixed & variable, so that
they can be related to the planned level of sales. The distribution expenses include
costs such as transportation & warehousing. These expenses should be planned by
responsibility centers which, in some cases, may be sales territory, in other cases the
product itself. In the case of distribution costs also it may be useful to classify that costs
as fixed & variable.
Selling expenses are those expenses that are requires to make a sales & to distribute
the merchandise to the customer. The manager is responsible for selling expenses
budget. Many selling expenses may be budgeted based on percentage of sales,
including salesperson commission & salaries, sales promotion, distribution freight,
traveling, training etc. control & monitoring purpose is highly essential
126
PROFITABILITY STATEMENT
Profitability statement is prepared to glimpse the profitability of the organization.
Preparation of budget helps to increase the bottom line of the organization. It helps to
prepare the budget year after year. The main purpose of the budgeting activity is to
show the future position of the business when it follows a plan operating at particular
level of efficiency (in case of IPCL it follows an efficiency of 95% or more).
Note: Balance Sheet is not attached, as a disclosure of Balance Sheet is not permitted
under the policy of the company.
LIMITATIONS OF THE STUDY
Head office of IPCL is located at Mumbai. All major Finance functions are carried
out by top level management in Mumbai, so there is less access to data.
Some information were no revealed due top security reason
Getting appointment with concerned personnel of various departments
127
Analysis and Interpretation

Variance Analysis
Variance analysis seeks to analyse the factors that cause the actual results to differ
from the pre-determined budgeted targets. It distinguishes between controllable and
uncontrollable items. It also finds out variances which are caused by controllable factors
such as inefficiency. Helps identify individual/departments that are accountable for the
variances
IPCL performance of April has been taken into consideration for case study to find out
the following variance between the budgeted & the actual.
A) PRODUCTION VOLUME VARIANCE

Budget considered the own (domestic) production to tune to 6040 MT but the
actual production is recorded as 6803 MT. There is an excess production of 763
MT. Also budget considered the job (export) production to tune to 2328 MT but the
actual production is recorded as 1660 MT. There is a shortfall of 668 MT. After
having studied the reasons of the production variance the following are being
noted as causes.
Causes for lower contribution were:
Due to lower efficiency
Due to power failure./ fluctuation
Due to Lower Avg. Denier
Due to less oil application
Due to Non-Availability of material / Machines stop
Due to change in Product Process Modification

128
Causes for higher contribution were
Due to Higher Avg. Denier for change in Product Mix
Due to Higher Efficiency/More machine Run
More machine Run
Due to Increase in the speed of the Machines
higher % of oil pick up
SUGGESTION
Increase the efficiency by giving attention to utility breakdown like Air supply, Air
Compressor & Air conditioner. Also giving immediate attention to idle spindles.
Make material available at any giving point of time from the Stores, i.e. keeping
enough inventories needed. This will also reduce the sudden stoppage of
machines due to material deficiency, & automatically reduce the machine running
hours.
Less oil application may make the yarn static & is more likely to get disconnected
from the spindle. So for the process to run smoothly without getting disconnected
there should be enough application of oil. This may reduce the machine
stoppage & also number of defectives.
B)
SALES VOLUME VARIANCE

Going through the sales budget it has been found that there is a difference in
budgeted sales & the actual quantity of sales. The budget considered the sales
to be 6040MT but the actual quantity sold is only 5412 MT. there is a shortfall of
628 MT.
129
The causes for the shortfall can be noted as under
Lack of sales force
Lower job production of 668 tons,
C) OTHER CAUSES FOR VARIANCE
Employee turnover rate is high
Problems with contract labours
Changes in price of raw material
130
PLANT PERFORMANCE (MAY 07)

UNITS
IPCL
Production
Mt
Planned
19980
Actual
17535
Sales volume
Mt
19980
17326
Value
Rs. Cr.
164.95
133.54
Net Realised
Rs/kg
82.56
77.08
Raw material
Rs/kg
62.89
62.47
Chem
RS/KG
1.83
1.22
Power & utility
RS/KG
5.91
4.75
Stores & spares
RS/KG
0.79
0.58
Packing Materials
Rs/kg
2.96
2.41
Outside processing Rs/kg
0.00
0.00
Conversion cost
Rs/kg
11.49
8.88
By product Credit
Rs/kg
-0.06
Total Variable Cost
Rs/kg
74.38
71.30
Variation in Stock
Rs/kg
0.00
-0.02
Cost of Sales
Rs/kg
74.38
71.28
Contribution
Rs/kg
8.17
5.80
CONTRIBUTION
Rs/kg
16.33
12.05
Particulars
FINDINGS
1.
IPCL is the largest producer of polyester yarn.

131
2.
The company enjoys a strong presence across the country with more branches.
3.
There is difficulty is using the SAP system and getting acquitted with it.
4.
It has a large customer base due to its quality.
5.
The company presently using master budget which take time and is difficult to
prepare.
6.
Commission provided to the sales person is low compared to its competitors.
SUGGESTIONS
1.
Company should try to make flexible budget as it would be easy in making for all
the materials.
2.
It should increase the rate of commission on new product.
CONCLUSIONS
132
A budget is in a sense a one year slice of the strategic plan. However, it is prepared in
more details than the strategic plan, & its preparation involves managers at all levels in
the organization. An operating budget shows the details of revenues & expenses for the
budgeted year for each responsibility center & for the organization as a whole. It is so
structured that amounts are identified with specific responsibility center.
The process starts with the dissemination of guidelines approves by senior
management. Using these guidelines, each responsibility center manager prepares a
proposed budget, which is reviewed by his/her superior and an agreed position is
negotiated. When these individual pieces reach the top of the business unit or the whole
organization, analysts review them for consistency and adherence to overall corporate
goals. The whole process is primarily behavioral. Responsibility center manager must
participate in the process. But they may do so within constraints decided on by senior
management. Participative budgeting, in which manager feel that have influence on the
process, has benefits generally for the organization.
Business unit managers report their financial performance to senior management
regularly, usually monthly. The formal report consists of comparison of actual receives
and costs with budgeted amounts. The difference, or variances, between these two
amounts can be analyzed at several levels of details. This analysis identifies the causes
of the variances from the budgeted profit and the amount attributed to each cause.
Hence, it can be used as an instrument of control.
BIBLIOGRAPHY
133
1.
www.kmsril.com
2.
Magazines and Annual reports
3.
Facts and figures of the company
4.
I.M. Pandey, Financial Management
ANNEXURE
134
TRAINING NEEDS IDENTIFICATION

Date:
Training needs identified: (Brochures / leaflets may please be attached, if any)
a)
Specific training needs
i): ________________________________
(Topic/s)
ii): ________________________________
b)
General training needs
i): _________________________________
(Topic/s)
ii): ________________________________
c)
Type of Training
: In-house / External / Institutional
(For specific training needs only)

The following Executives / Staff are being deputed for the same.
Sr.
EC No.
Name
Signature of Functional Head
Design
Deptt.
Signature of Approving Authority
___________________________________________________________________
PARTICIPANTS FEEDBACK FOR
135
Name:____________________________E.C. No:-_____________________________
Department: _____________________________
Subject/Topic: _____________________________
Type of programme : a)In house / External / Institutional
b)Seminar/ Conference / Training
Date/Duration
of
programme:
-------------------------------------------------------------------------------------------------Conducted
by:
__________________________________
Venue:_____________________________________
COMMENYS/REMARKS OF PARTICIPANTS
I) For Training :(To be filled by participant's , if attended training )
a)Arrangements / Facilities Provided :
i) Excellent ii) Very Good iii) Average iv) Below Average
b) How well the objectives of the programme were met?
c) Opinion about the faculty:
d) How of you plan to implement the learning acquired to develop your professional skill
_____________________________________________________________________
II) For Seminar / Conference (To be filled by the participants if attended
Seminar/Conference)
Theme: _______________, Relevance of the programme __________________ , How
the
programme
benefit
the
employee/
Organisation___________________________________________________________
136

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PROJECT AT A GLANCE

OBJECTIVE OF THE STUDY

Day to day operation of the company.

INDIAN PETROCHEMICALS COOPERATION LIMITED

INDIAN PETROCHEMICALS COOPERATION LIMITED

INDIAN PETROCHEMICALS COOPERATION LIMITED

railway station is Vapi and airport is

INDIAN PETROCHEMICALS COOPERATION LIMITED

SALIENT FEATURES OF IPCL

INDIAN PETROCHEMICALS COOPERATION LIMITED

SR. MGR (F&A)

INDIAN PETROCHEMICALS COOPERATION LIMITED

Code of ethics and business responsibility

State purpose and review agenda

Everyone contributes constructively

Summarize issues and decisions

INDIAN PETROCHEMICALS COOPERATION LIMITED

Texturising (Plant -2)

INDIAN PETROCHEMICALS COOPERATION LIMITED

Total Hard Wastage

HEALTH, SAFETY AND ENVIRONMENTAL POLICY

Occupational Health and Safety Management Plan in order to achieve continual

INDIAN PETROCHEMICALS COOPERATION LIMITED

employees & Contractor

observing safe work practices & establishing continual improvement .

Identification of occupational health hazards.

To strive for optimum utilization of human resources and creating an

To achieve excellence in implementing the statuary and Non-statuary welfare

Implementation of HRD Policy of the company;

INDIAN PETROCHEMICALS COOPERATION LIMITED

To achieve perfection in educating employees of observing and implementation

HUMAN RESOURCE DEVELOPMENT POLICY

INDIAN PETROCHEMICALS COOPERATION LIMITED

2. Enhancing the spirit of camaraderie through mutual trust, self-respect and

speed, Simplicity and self-confidence.

SOCIO-CULTURAL ACTIVITIES AT IPCL

Ambulance donated to Red Cross

Nearby schools adopted for computer education

Tribal Womens Education

Sneh Sutru Magazine

BIRDS EYE VIEW

: Indian Petrochemicals Cooperation Limited

: Private Limited Company.

: a) Mr. Shiva P Chakravorty (chairman)

: Chaturvedhy & Shah.

AWARDS & ACHIEVEMENTS

Received Certificate of Excellence for CASH project in 2005-06.

: Silvassa Industries Pvt. Limited

INDIAN PETROCHEMICALS COOPERATION LIMITED

: Silvassa Industries Pvt. Limited

: Silvassa Industries Pvt. Limited

Licensed production capacity

Installed Production Capacity

Share in the Indian market

1192 Rs. crs

INDIAN PETROCHEMICALS COOPERATION LIMITED

Located in Zero Pollution area

Air conditioning capacity

Compressed air capacity

POY ( Partially Oriented Yarn)

Textured & Twisted Yarn

Crimp, Tex, Intermingled

Bhiwandi, Surat, Kanpur, Udaipur,