1

A REPORT ON ORGANIZATIONAL STUDY

AT

CARBORUNDUM UNIVERSAL LTD (CUMI)
NALUKETTU , KORATTY


Submitted
ALIAS A Y


Under the Guidance of
PROF . S . G . BHAT

I n
Partial fulfillment of the requirements for the
award of the degree of
Master of Business Administration



Department of Management Studies

ADI SHANKARA INSTITUTE OF ENGINEERING & TECHNOLOGY
(An ISO 9001:2008 Certified Institution)

(2012-2014)
2


DECLARATION



I, ALIAS A Y hereby declare that this report of the Organizational Study at
CARBORUNDUM UNIVERSAL LIMITED, KORATTY , NALUKETTU has been
prepared by me under the guidance of Prof. S.G. BHAT, ADISHANKARA INSTITUTE
OF ENGINEERING AND TECHNOLOGY, Kalady . I also declare that this training
report is my original work and it has not previously formed the basis for award of any degree
or diploma.



Date:
Place: Kalady ALIAS A . Y.































3


ADI SHANKARA INSTITUTE OF ENGINEERING & TECHNOLOGY
Shankar Nagar, Mattoor, Kalady




CERTIFICATE



Certified that this is a bonafide record of the project work Organizational Study
submitted by ALIAS A Y during the year 2012-2014 inpartial fulfillment of the
award of the degree of Master of Business Administration.







Faculty Guide H.O.D (MBA) Principal (ASIET)








4


ACKNOWLEDGEMENT


The successful and timely completion of this Organization Study
and its reports become possible only with those eminent personalities who extended their
wholehearted support and valuable assistance.

First of all I would like to extend my gratitude to our Principal Dr. Prof. S G IYER,
our HOD and guide Prof. S G BHAT of ASIET College, Kalady for their excellent
encouragement and support throughout the course of this project.

I express my humble gratitude to Mr. JULIUS V. D. , HR Executive of
Carborundum Universal Limited (CUMI), Nalukettu ,Koratty for his guidance , support
and friendly cooperation which shaped this organizational study from its completion . .I
express my sincere thanks to Mr. BIJU ISSAC, Plant manager of Carborundum Universal
Limited (CUMI), Koratty .

Above all, I thank the power and spirit of universe, the Almighty, for his inspirations
throughout the life.







Date: ALIAS A Y
Place: Kalady














5


TABLE OF CONTENT














































Chapter No. Title Page No.
1 Introduction

- Objective of study
- Scope of the study
- Limitation










2 Industry Profile



3 Company Profile

Organisation Structure

Product Profile





4 Functional Departments

4.1 Operation department

(a) Production department
(b) Quality department
(c) Maintenance department

4.2 HR department

4.3 Finance department
.
4.4 Shipping &Marketing
. department

. 4.5 System department















5 SWOT Analysis


6 Conclusion

Appendix

Bibliography

6




















CHAPTER 1

INTRODUCTION

















7

INTRODUCTION


The organizational study was conducted in Carborundum Universal
Limited, Koratty. As a part of MBA course this organizational study helps to know about the
organizational activities and various functions of the different department . The
organizational study was mainly conducted for knowing the particular organization and also
for getting amble information about the activities of each department.

Carborundum Universal was established in 1954 as a joint venture between
the Murugappa Group, India, the Carborundum Co., USA, and the Universal Grinding Wheel
Co. Ltd, U.K. . The main business activity of Carborundum Universal involves manufacture
of coated abrasives, bonded abrasive, super-refractories, electro-minerals, industrial ceramics,
and ceramic fibers. Further, CUMI produces about 20,000 different varieties of abrasive
products, refractory products, and electro-minerals. Carborundum Universal Ltd. has 10
manufacturing facilities across India and these manufacturing facilities are meticulously
connected with wide network of distributors and sub distributors .

CUMI is known to be an innovator and exports its products to 43
countries spread across North America, Europe, Australia, South Africa, and Asia. All the
manufacturing facilities of Carborundum Universal are ISO 9001:2008 , ISO 14001: 2004
and ISO 18001: 2007 certified for quality standards , environment-friendly and health-safety
manufacturing practices respectively.








8

Objectives of the study:

To study the functions of various departments
To understand the process flow in each departments
To understand hierarchical structure of various departments
To do SWOT analysis of organization
To have an exposure to the working environment




Scope of the study:

The study has been conducted at Carborundum Universal Ltd, Koratty, Thrissur, Kerala,
during the period of May, 2013.The study focuses on overall understanding of how the
various departments in the organization function.



Limitation :

Time is a major limitation since the organizational study was only for a period of one
month
Officers were at the peak of work and busy schedule of the department heads










9


















CHAPTER 2

INDUSTRY PROFILE















10

INDUSTRY PROFILE

World scenario
The electro mineral industry faced competition from imports but this was counted by
delivering quality product . In the export market, removal of anti-dumping duty of Chinese
product export to Europe. However during period the European counties are falling to
financial crisis . Many of companies stopped their production or quantity of production is
decreasing due to financial crisis .

Indian scenario
CUMI will continue to focus on quality and application, specific product offering and on
improving its customer base. In the domestic market there are 3 manufactures for electro
minerals. CUMI is market leader in the Indian Industry .The export market will be targeted
with Silicon Carbide micro grit with improved in product quality. CUMI is a major player in
the domestic market for the Brown and White Fused Aluminum Oxide and Silicon Carbide.
The key success factor in the industry is cost and quality, while entry barriers are
sophisticated technology. The availability of substitute product, product differentiation and
imports continue to be the principle challenge in the business.

State Scenario
There was a 17% increase in power tariff in Kerala, which adversely affected the profitability
of the electro-minerals industry. This was future compounded by the low power plant due to
poor monsoon in Kerala last year. The cost push created by improvement in operating
efficiencies of the country. Use of consumption and reduction in power consumption and
improvement in crude recovery helped in the same.

Competitions
In India there are four main players in this Industry. Apart from CUMI, SNAM Abrasives,
Orient Abrasives and Grind well are the major players. In order to mitigate the competition
risk, CUMI entered into a joint venture with Wendt India and holds 40% of its share capital.
After the joint venture, it now offers full range of abrasives to its Customers viz.
conventional and super abrasives. Super abrasives are manufactured by Wendt India Ltd. at
its plant located at Hosur in Tamil Nadu. CUMI is a market Leader in Indian abrasive
11

industry and enjoys a share of more than 45% followed by Grind well Norton which has a
share of 40% in the abrasive market.

Major Players (Major Competitors )
3M Coated abrasives division(USA)
Abandon Silicon Carbide of Aluminum production complex(ABASIC)
Abrasive Grains E.T Powder SA(AGP)France
Beiging Kingder Resource and Technology Development Corporation (China)
Carborundum Universal LTD (India)

Carborundum Universal Limited manufactures the widest range of Bonded and Coated
abrasives in the world. The Rs 314 crore, the company pioneered the manufacture of coated
and bonded abrasives in India, besides super refractories, electro minerals, industrial ceramics
and ceramic fibers. CUMI makes over 20,000 different varieties of abrasives, refractory
products and electro-minerals, manufactured at 14 locations. CUMI has the distinction of
having all its manufacturing units ISO 9001: 2008 certified.

Industry overview
Competition is increasing day by day so that the product development will be the main
criteria. Our mineral resources are limited so there is a challenge in future development. High
capital investment, limited market, sophisticated technology, availability of substitute
products, product differentiation & import are the principle challenges in this industry.

Exports
Carborundum industry plays a significant role in the growth of Indian economy and it is an
important component of global trade.. It is the second largest industry of India and is the
largest foreign export earner, accounting for 35% of the gross export earnings in trade .They
export 23 countries across the world.






12



















CHAPTER 3

COMPANY PROFILE





















13

COMPANY PROFILE

ESTABLISHMENT
CARBORUNDUM UNIVERSAL LTD (CUMI)
Carborundum Universal, also known as Carborundum Universal
Ltd (CUMI) is an India-based coated and bonded abrasive manufacturing company
.Carborundum Universal was established in 1954 as a joint venture between the Murugappa
Group, India, the Carborundum Co, USA,and the Universal Grinding Wheel Co. Ltd, U.K.
The main business activity of CUMI involves manufacture of coated abrasives, bonded
abrasive, super- refractories, electro-minerals, industrial ceramics, and ceramic fibers.
Further, CUMI produces about 20,000 different varieties of abrasive products, refractory
products, and electro-minerals. Carborundum Universal Ltd. has 14 manufacturing facilities
across India and these manufacturing facilities are meticulously connected with a wide
network of distributors and sub distributors. The company pioneered the manufacture of
Coated and Bonded Abrasive in India in addition to the manufacture of Super Refractories,
Electro Minerals, Industrial Ceramics and Ceramic Fibres. Today the company ranges over
20,000 different varieties of abrasives, refractory products and electro-minerals are
manufactured in ten locations across various parts of the country.

CUMI-Business Distribution (As per the revenue)


CUMI is known to be an innovator and exports its products to 23
countries spread across North America, Europe, Australia, South Africa, and Asia. All
the manufacturing facilities of Carborundum Universal are ISO 9001:2008 certified for
quality standards and ISO 14001 certified for environment-friendly manufacturing
14

practices and OSHAS 18001 certified for health and safety respectively. Carborundum
Universal Ltd Koratty , electrominerals unit established in 1985 . The R & D wing comes
out with constant innovations and product up gradations of products, which makes the
company a world leader in grinding technology. Its core competence provides total grinding
solutions which enables maximum grinding efficiencies and reduced cost for customers.

COMPANY HISTORY YEAR EVENTS



Incorporate as a joint venture between caborundum company, USA/Universal
Grinding Wheel Company, UK and the Murugappa Group, India.
Acquired a coated abrasives facility from Ajax Products pvt.ltd.
Bonded abrasives facility set up at Chennai, India
Bauxite mining at Bhatia,gujurat,india



Manufacture of super refractories at Chennai, India
Brown aluminum oxide grains plant at Edappally, India
Bauxite mining at Bhatia, Gujarat



Acquisition of Eastern Abrasives Ltd,a coated abrasives manufacturer in Kolkata,
India
Second bonded abrasives plant at Hosur, ,India
Established MMECL as a joint venture with Morgan Group plc,for ceramic fibres



Expansion of bonded abrsives plant at Hosur with a modern facility for vitrified
grinding wheels.
1954-1963 Revenues Rs.19 million

1964-1973 Revenues Rs.78 million

1974-1983 Revenues Rs.337 million

1984-1994 Revenues Rs.1308 million

15

Silicon carbide plant at Koratty & Refractories plant Ranipet,India
Industrial ceramic plant at Hosur, India
Acquisition of 40% interest in Wendt (India) Ltd., a joint venture with Wendt Gmbh,
Germany for super abrasives.



12 MW Hydel project at Maniyar ,Kerala
Second unit at Edapally for manufacture of brown aluminum oxide grains.
Acquired a controlling interest in Cut fast Abrasive Tool Ltd,and cut fast Polymer
ltd,a Chennai Based abrasive manufacturer and subsequent mergers
Established a 5.5MW natural gas based thermal power plant in Nallur in Tamil Nadu,
India through Southern Energy Development Corporation Ltd.
Acquired Prod rite Anticorrosive ltd, a leading player in anti-corrosion engineering.
Cloth proceeding facility at Maraimalainager ,Tamil Nadu



Capital investment of about Rs.4 billion for various modernization, expansion/new
product projects.
Automated thin wheel facility at Hosur and Chennai, India
Modern silicon carbide micro grit plant in Koratty, India
Modern polymer manufacturing facility near Chennai, India
Establishment of CUMI Middle East & CUMI Canada Inc.
Establishment of state of the-art coated abrasives Sriperambudur ,Chennai ,India
Acquisition of monolithic refractory facility in Jabalpur, India
Acquisition of Volzhskiy Abrasives Works, Russia
Acquisition of the Technical Ceramics Unit at Aurangabad, India
Acquisition of 51% holding Foskor Zirconia (Pty)Ltd ,South Africa, the worlds
largest manufacturer of Zirconia
1995-2004 Revenues Rs.3150 million

2005-2012 Revenues Rs.12126 million

16

World class facility for wear resistant liner, tiles, Hosur, India
Manufacturing facility for Thin Wheels, Uttarkhand, India
Manufacturing facility for Power Tool at Jigani, Bangalore, India.
Commissioning of a modern 1,000 tonne vitrified bonded abrasives plant & 2,000
tonne organic bonded abrasives facility in China
Establishment of state-of-the-art metalized cylinder plant at Hosur, India
Establishment of state-of-the-art super refractorys plant at Ranipet Serkaddu,India
Setting up of a modern facility for manufacture of anti-corrosive products at
Serkaddu, India
Establishments of automated silicon carbide micro grit plant in Cochin SEZ

Koratty plant
Carborundum Universal Limited Koratty , Electrominerals Macro unit established in 1985 .
The plant main product macro Silicon Carbide . Modern Silicon Carbide micro grit plant
established in 2005 . Now the plant capacity , Plant macro unit about 1000tons per month and
micro unit about 750 tons per month .
VISSION AND MISSION
Vision:
The vision of the Carborundum Universal Limited is we will be admired technical ceramic
company driven by innovation continuously enhancing stakeholder wealth

Mission:
The mission of the Carborundum Universal Limited we will steadily improve EMDs
profitability and grow aggressively in new products and micro grits.
To be innovative, resourceful, and profitable company.
To meet customer requirements of quality service and price consistency.
To make doing business with us easy, and delightful to our customers.
17

To provide an entrepreneurial environment in which employees can respond to the
needs of business and service, earn fair rewards and can be satisfied.

OBJECTIVES
To maintain the market leadership.
To minimize the cost incurring in production process.
To maintain the product quality.
To be competitive at all markets.
To be compliment to all global quality standards.
To maintain the top position in the industry.
To utilize the new technological changes for the benefit of the company


Forward into the Future
Carborundum Universal Limited is gearing for its next phase of growth and
expansion .Growth that could be defining and provide a quantum leap in terms of terms of
scope and scale .Continuing its journey in sustainability , the company has drawn up plans for
expansions , acquisitions and synergistic alliances with international technology providers .
Flagging the commencement of this phase , CUMI has entered into an
agreement for acquisition of a fused minerals and super refractory products manufacturing
facility which will be named as Thukela Refractories , South Africa .
CUMI s vision is value driven and based on trust and enduring people
relations . Relationships that transcend transactions and celebrate sustainability as an integral
part of growth .

18

ENVIRONMENTAL POLICY:
We at CUMI are committed to be an eco friendly organization and shall strive to protect,
preserve and to improve our environment. This will be achieved through
Continual improvement of the operations for achieving better environmental
performance
Optimizing usage of energy and other resources
Minimizing waste generation and disposing appropriately to reduce the on the
environment
Complying with environmental legislations and regulations other requirements to
which the organizations subscribes
Creating environmental awareness among all those who work and on behalf of the
organization

QUALITY POLICY
We shall proactively meet customer expectation by providing quality products and services.
This will be achieved through:
1. Total commitment of the management in implementing an effective quality
management system
2. Continual technological development in fulfilling changing need of the customer.
3. Total employee involvement for continues improvement
4. Enhancing employee competence through education and training
5. Building mutual beneficial relationship with suppliers





19

BOARD OF DIRECTORS
Mr. M . M. Murugappan : Chairman
Mr. Subodh Kumar Bhargava : Non executive Director
Mr. T L Palani Kumar : Non executive Director
Mr. Sridhar Ganesh : Non executive Director
Mr. Lakshminarayan : Non executive Director
Mr . Shobhan M Thakor : Non executive Director
Mr. Sanjay Jayavarthanavelu : Non executive Director
Mr . K Srinivasan : Managing Director




CUMI Plant Locations

1 CUMI Plant location

CUMI , Tiruvottiyur ,Tamil Nadu
CUMI , Bonded Division , Hosur ,TN
CUMI , Cutfast Division , Pallikaranai , TN
CUMI , Parganas District , West Bengal
20

CUMI WINDFARM , Tirunelveli , TN
CUMI , Industrial Ceramics Division , Dharmapuri , TN
CUMI , Super Refractories Division , Ranipet , TN
CUMI , Electrominerals Divisions ,Kalamassery , Kerala
CUMI , Micro plant , Cochin SEZ , Kakkanad


2. Plant locations of Subsidiaries / Joint Ventures

Sterling Abrasives Ltd , Gujarat
Muragappa Morgan Thermal Ceramics , Ranipet ,TN
Wendt Ltd , Hosur , TN
Volzhsky Abrasive Works , Russia
CUMI Abrasives & Ceramics Co. Ltd , China
CUMI Australia PTY . Ltd , Malaga
CUMI Canada Inc.













21















ORGANISATION STRUCTURE














22

OPERATIVES OPERATIVES
SHIPPING
EXECUTI-
VES
TEAM
MEMBERS
SENIOR MANAGER
MANUFACTURINJG
OPERATIVES
TEAM
MEMBERS
ORGANISATION STRUCTURE

































M D
K . S . SREENIVASAN


SR MANAGER
ENGINEERING
&
MAINTENANCE
SENIOR
MANAGER
TQM & QA
MANAGER
MANAFACTURI-
NG
(MACRO)
SENIOR
MANAGER
SHIPPING
MANAGER
MANUFACTURING
(MICRO)
MANAGER
ACCOUNT
JR
SUPERVISOR
SENIOR
MANAGER
HR
JR.
SUPERVISOR
DM
MANUFACTURING
DEPUTY
MANAGER
QA
DEPUTY
MANAGER
SUPERVISOR

HR

EXECUTIV
E
SUPER-
VISOR
DM
MANUFACTURING
ASSIT
ACCOUNT
SUPERVISOR
STORE
SENIOR VICEPRESIDENT (EMD)
N ANANTHASESHAN

GENERAL MANAGER ( MANUFACTURING)

A R SATHEESH
SYSTEM
ADMINI-
STRATOR
OPERATIVE
S
23

NATURE OF PRODUCT
Silicon Carbide is a man made mineral of extreme hardness and sharpness. It is the ideal
abrasive for grinding / sanding materials of low tensile strength such as Cast Iron, Brass,
Aluminum, Bronze etc. Its thermal properties make it an excellent medium for use in the
manufacture of refractory products and crucibles.
Silicon Carbide is produced by a process involving the electrochemical reaction of silica in
the form of quartz with Carbon in the form of raw petroleum coke. The stoichiometric
mixture is reacted in an electrical resistance furnace at a temperature greater than 2200C to
yield high quality crystals. The large crystals are then segregated, crushed, cleaned of
magnetic impurities in high intensity magnetic separators and classified into narrow size
fractions to suit the end use. Dedicated lines produce products for different applications.
Silicon Carbide Grains are also used in marble and granite polishing, manufacture of Kiln
furniture and as a deoxidizer in Iron and steel making.
Silicon carbide (SiC), also known as carborundum, is a compound of silicon and carbon with
chemical formula SiC. Silicon Carbide powder has been mass-produced since 1893 for use
as an abrasive. Grains of silicon carbide can be bonded together by sintering to form very
hard ceramics which are widely used in applications requiring high endurance, such as car
brakes, car clutches and ceramic plates in bulletproof vests.















24






















CHAPTER 5

FUNCTIONAL DEPARTMENTS


















25

4.1 .a. PRODUCTION DEPARTMENT

Production department structure




SENIOR MANAGER
MANUFACTURING
MANAGER MANUFACTURING MICRO
DM MANUFACTURING
MANAGER MANAFACTURING
MACRO
JR SUPERVISOR
OPERATIVES
OPERATIVES
JR SUPERVISOR
DM MANUFACTURING
GENERAL MANAGER
26

SILICON CARBIDE is the major product produced in CUMI Ltd. Raw materials used are
quartz and raw petroleum coke. These two raw materials are furnished at a temperature of
2200 C. This furnished product is classified in to two
Macro
Micro

MACRO
1) Furnace plant
The raw materials of the product are quartz and coke. They are mixed along with reclaim for
making mix charge as per the mix card issued by QA .One mix charge should be nearly
4tonnes ( ONE MIX = COKE 560 kg ,QUARTZ 800 kg ,Brg1 200kg ,Brg2 2350kg ,Water
100L ).Like wise 20 mixes will be used to fill a furnace. Furnasing will continue for 48 hours.
After that it will be allowed for 16 hours air cooling and 8 hour water cooling .Cooled pig
will be manually sledged to remove half reacted crushed in Jaw crusher and it will be send to
GP for further crushing and grading.

2) Grain plant
Crushing
Macro grit is the crushing of silicon carbide through different crushing such as
BARMAC, Raymond mill and other silicon carbide is crushed in to grains. Hence we
derive powder form of silicon carbide, macro grains.
Magneting
During the process of crushing some iron particles are attached with macro grit which is
then removed through high force magnets
Sizing
It is for grading the product. Different sizing machines are used with different openings.
Quality control check
27

Detailed chemical and physical analise is done to determine the iron percentage, silicon
carbide, size, magnetic, imputation and bulk density.


Bagging
All the grits are then bagged and send to Chennai for further production. They use HDPE
bags. Paper bag used for HDPE restricted countries.



MICRO

The input of micro grit plant is the end product of the macro plant. But in this plant
the grit are imported from Russia due to finer quality and economies available
1) Jet Milling
Its operations refer to crushing using compressed air. This is an iron free grinding
process.
2) Air Classifier
With the help of air classifier product are graded.
3) Quality control check
The chemistry, size and quality of the product is checked and assured.
4) Bagging
The end production is then packed for shipping.

Bonded Grain Sizes Available
F12 , F14 ,F16, F20, F24, F30, F40, F46, F54, F60 , F70, F80, F90 , F100,
F120, F150, F180 and F22O as per FEPA ( Federation of European Producers of
Abrasives) standard 42-1:2006

28

COATED GRAIN SIZES AVAILABLE
12, 14,16, 20, 24, 30, 36, 40, 46, 54, 60, 70, 80, 80, 90, 100, 120, 150, 180 and
220as per FEPA (Federation of European Producers of Abrasives) standard 43-1:2006.



BLACK SILICON CARBIDE MICRO

GRAIN SIZES AVAILABLE
F240, F280, F320, F360, F400, F500, F600, F800, F1000 and F1200
.

Applications are:
Bonded Abrasives
Bonded abrasives is a matrix of closed size abrasive grains pressed together with the help of
vitrified, resinoid or rubber bonding material into a variety of shapes, like grinding wheel,
honing stone etc. The matrix is fired at high temperature to provide a high strength bonding
between the abrasive grains.
CUMI specialize in manufacturing of a complete line of closed sized abrasive grains in
various shapes, sizes and densities, etc. to perfectly fit any grinding application and working
condition.
CUMI Sharp grains are blocky sharp edges with low iron and silica content. Its high
toughness & hardness (Mohs Hardness 9), excellent abrasion resistance, high corrosion
resistance properties combined with cooler cutting characteristics, appropriate friability,
multi-fracturing properties exposing sharp edges and self sharpening characteristics makes it
an ideal raw material for the manufacturing of bonded abrasive for all applications.

Typical Applications
Ball grinding & ball lapping wheel
Rice polishing wheel
Gear grinding wheel
Cam grinding wheel
Crankshaft grinding wheel
Valve components grinding
Internal grinding wheel
29

Thin wheel
Tool room grinding wheel
Roll grinding wheel
Razor blade wheel
Flute grinding
Bearing grinding wheel

.
Coated Abrasives
Coated abrasives is a three component system consisting of abrasive grains adhering to the
semi-flex backing like paper, cloth, fibre, plastic film etc with the help of resin or glue bond.
Coated Abrasive is manufactured as rolls which is then converted into different foams like
belts, disc, flap disc, flap wheel & spindle mop, sheet & non- woven products.
CUMI specialize in manufacturing of a complete line of closed sized abrasive grains in
various shapes, sizes and densities, etc. to perfectly fit any coated abrasive application and
working condition.
CUMI Sharp Grains for coated abrasives are angular, sharp edged with high capillarity for
instant adhesion to resin or glue bonds and electrostatic characteristics carefully monitored to
provide consistent and reliable grain projection. The High hardness (mohs hardness 9) and
toughness of the CUMI Sharp grains combined with the multi-fracturing property, self
sharpening characteristics and cooler cutting characteristics of the grains makes it an ideal
raw material for the manufacturing of coated abrasives for any application.

Typical Applications
Coated abrasives are used by hand or on machines, applications are extremely varied, at
home and in industry for:
Fine finishes: hand sanding or polishing of wooden cabinets, car bodies primers, metals.
High precision operations: Optical lens polishing, magnetic head super-finishing.
Medium stock removal with portable or fixed machines: Floor sanding, disc grinding of
metal, endless belts grinding of wood, metal, glass.
Heavy stock removal with wide (up to 3 m) belts on high power machines to grind stainless
steel sheets or coils or to calibrate plywood or chipboard panels.



30

Brake Lining

Brake lining are mainly composed of a heat resistant and strong fiber which are relatively soft
yet tough with high co-efficient of dynamic friction mounted to a solid backing using high
temperature adhesive or rivet. In order to increase the dynamic co-efficient of friction and
decrease the wear of the brake lining under high temperature produced during braking,
ceramic grains are added to the fiber.
CUMI Sharp micro grains with stringent particle size distribution possesses high toughness &
hardness, excellent abrasion and wear resistant and physical & chemical stability at high
temperature which makes it an ideal additive to the brake lining for higher dynamic co-
efficient of friction, longer life and hence better performance of the brake lining.


Typical Applications
Automotive brake
Rail brakes
Air-craft brakes

High Abrasion Resistance Coating
High abrasion resistance coating is a composite system containing
a high strength resin like epoxy and high abrasion resistance ceramic particles. The high
abrasion resistance coating is in the form of a thixotropic paste which could be easily applied
on the surface with a brush or in the form of a putty containing up to 70% solid mass. The
high abrasion resistance coating is used as a protective coating or to repair worn areas in
material handling equipment or components conveying abrasive materials.
CUMI Sharp micro grains possesses high hardness (more than 9 Mohs),
high toughness, excellent abrasion resistance, high resistance to chemical attack and
corrosion. These characteristics of CUMI sharp grains makes it an ideal raw material for the
manufacturing of High abrasion resistance coating.

Typical Applications
Slurry transport Lines
Agitator assemblies
31

Impellors
Ash and slurry Pumps
Shafts
Exhaust fans
Ore processing tanks
Screw conveyors
Cyclones
Pipe elbows
Chemical composition

Production capacity:
Production capacity of the Plant 1 is 1000 tons per month and the Plant 2 is 750 tons per
month

Packing:

25 kg multiply paper bags of 1000 kg palletized .Other packaging types on request

Work shifts:
The company works in three shifts;
8am-4pm,
4pm-12am, and
12am-8am.

ROLE AND RESPONSIBIITY OF PRODUCION MANAGER
Responsible for managing the production staff.
Monitoring the day today production.
Ensuring the timely dispatch of sales vehicles.
Ensuring quality of the product.
32

Training newcomers on the process. Taking trials of bread and bun.
Preparing the production report on the day today basis.


SLOGANS

Improve standard of living by increasing productivity
Wear safety gadgets in plant















33

4.1.b.QUALITY CONTROL DEPARTMENT
Quality Assurance Department Structure


CUMI is renowned for its quality, not only in electro minerals but also in all their products
such as abrasives and ceramics. As the raw materials for producing abrasives and ceramics
are electrominerals, whose quality is very important.

Quality policy of CUMI:
We shall proactively meet customer expectation by providing quality products and
services.


SENIOR MANAGER QA
DM QA
SUPERVISOR
JR SUPERVISOR
TEAM LEADER
34

This will be achieved through:
Total commitment of the management in implementing an effective quality
management system.
Continual technological development to fulfill changing needs of the customer.
Total employee involvement for continuous improvement.
Enhancing employee competence through education and training.
Building mutually beneficial relationship with suppliers.
Responsibility of quality department is checking the quality of the raw material because;
the quality of the final product is primarily depending on the raw material.
Quality is checked during-
Raw material is taken for the Production.
Mixing the raw materials.
Furnacing
Pig yard
Crushing.
Before packing the final product.
There are two laboratories in CUMI for checking the quality, they are:-
o Chemical lab
o Physical lab
In the chemical lab, they check the chemical properties such as gravity, percentage of
weight of each metal in the product, fusion level, and combination of the product etc.
In the physical lab, they check the free iron, HM (hand magnet), bulk density and size
analysis.
Final checking of the product is done in the bin. Quality analyzer checks the each bin and put
a bin card. If the bin card colour is green, that bin contains the product is accepted and that
bin goes to the packing section. If the bin card colour is red, that bin contains the product is
treated as rejected. If the bin card colour is yellow, they reserve that bin contains the product
35

for recycling.
They follow Total Quality Management (TQM) system for sustaining and improving the
quality of the products. The TQM values followed by the company are:
Excellence in all aspects of business.
Customer first attitude.
Total involvement.
Emphasis on leadership.
Internal customer support.
Continuous improvement.
Improving quality of life of the employee and society.
On time delivery.
CUMI maintain their TQM through various activities. These are:
5 S Policy: CUMI adopted 5s policy for improving the quality of product and work.
1)Sorting.
Segregate required usable re-workable and absolute item.
Dispose off the unwanted items.
Clear off walkways
2) Systematizing
Use labels, colour codes for easy identification
Use index doe files, records, drawings etc to facilitate retrieve ability
Plan storage with accessibility
3) Shining
Inspect the supply lines, scrap yards and gardens.
Clear up workplace, machine and tools after use
Identify root cause of loud noise, vibration, head noise, vibration heat buildup in
equipment and take remedial action



36

4)Standardizing
Establish checking procedure
Create visual control
Device ways and means and means to expose problems

5)Self discipline
Develop action plan for maintaining the self standards
Give unambiguous advice
. Quality audit
A systematic and independent examination to determine whether quality activities and related
result comply with planned arrangements and whether these arrangements are implemented
effectively and are suitable to achieve objectives.
The company has been following KAIZEN Japanese scheme for continuous improvement in
all activities of the business. This scheme means that the quality of the products or services is
determined by its uses, efficiency, value for the money, comparison with other products and
some other criteria etc. These parameters are varying depending upon the situations. So there
is no proper measure to determine the quality of products and services.
ISO Certification : CUMI has got ISO 9001-2008 series certification for quality assurance
in design / development, production installation and servicing

RESPONSIBLITIES OF QUALITY DEPARTMENT

Finished goods audit.
Packing material checking.
Raw material analysis.
Finished goods analysis.
Online checking of dividing weight
Online checking of finished product weight
Monitoring the hygiene and sanitation
Monitoring workers hygiene
37

Documenting the reports
Damage product checking
Production report making
Daily production report

SLOGANS
Its an attitude to achieve perfection
Our job # 1
Customer Satisfaction












38

4.1.c. MAINTENANCE & ENGINEERING DEPARTMENT
Maintenance and Engineering Services Department,
operates under certain responsibilities from which it derives its functions and commitments.
One responsibility is to ensure machine availability to ensure production as per monthly plan.
This is accomplished by ensuring minimum down time of critical and support equipment
maintaining high MTBF and Low MTTR, minimize machine downtime by adhering to
preventive maintenance as per plan
Another key responsibility is to ensure availability and quality of utility requirements
electricity, water and roads which are essential for ensuring continued and smooth operations
of the unit. All reports regarding the plant performance on utilities shall be maintained and
corresponding bills shall be verified by this department.
The department shall ensure required availability of all spares, consumables, wear parts for
critical process machinery as well as support equipment and utility facilities
Maintenance Work shop: - The maintenance work shop has the facilities for assembly of
rotatable, drilling and grinding and welding.
Department Objectives
Ensure availability of machinery as per business plan
Ensure adherence to performance parameter fixed in business plan
Reduce maintenance cost
Adherence to preventive maintenance plan
Initiate corrective and preventive action
Ensure availability , quality of plant utilities
Ensure safe disposal of waste
Ensure good housekeeping.
39

MAINTENANCE DEPARTMENT CHART











Responsibilities of Maintenance Department
Ensuring plant availability.
Planning and adherence to preventive maintenance schedule.
Ensuring machine parameters for optimum operation are maintained.
Prevent deterioration of machinery condition due to non-achievement of specified
parameters.
Execution of annual maintenance contracts.
Preventive Maintenance
As we know the famous proverb, Prevention is better than cure.CUMI believes in this
proverb. As per this, every Sunday maintenance operatives will inspect and do the
Sr. Manager-Engineering and
Maintenance
Dy. Manager- Engineering
Services
Supervisor
Operators (Mechanical) Operators (Electrical)

Trainees

40

maintenance work in the whole plant .They identify some critical machines and these
machines are periodically inspected
Prepare list of all equipment, identify Critical equipment
Critical machinery can be identified as those machines whose improper functioning will
lead to immediate stoppage of the production module
Master list preventive maintenance jobs to be prepared from equipment manuals and based
upon inputs from previous history break downs
. Safe work permits and checklists for PM execution shall be issued and verified by
maintenance in charges .
A preventive maintenance planner shall be prepared based on the above.

Breakdown Maintenance:
If any break down occurs, the concerned department will sent a complaint to the maintenance
department with the help of personal computer (ERP System Ramco No 3). Then the
maintenance Dept. head issues a work order depending on the manpower available. They will
try to rectify the root cause of the break down and bring the machine to the production
process

DOCUMENTS used
Master list of equipments
List of critical equipment
List of machine manuals and equipments manuals
Annual maintenance
Maintenance schedule
41

Preventive maintenance check list
Safe work permits
Use of Personal Protective Equipments (PPEs):
PPEs are one of the major factors to tackle many problems. The effective utilization of PPEs
wherever required minimizes injuries. The company has adopted a strategy regarding its
usage. The management has warned the concerned employees about the consequences of not
using the PPEs. It also considers taking disciplinary action against employees failing to use
them at his work place. The important PPEs provided are:
Helmets
Masks
Gloves
Ear plugs
Safety shoes
Slogans
Energy conservation is the foundation of the energy independence
Make every day , a safe day
Wear safety belts when working at a height
Look out power before starting maintenance






42

4.2.HUMAN RESOURCE DEPARTMENT

HR Department Hierarchy










Human Resource Department
Human resource has always been one of the focus points in business strategy. HR strategy
is carefully linked to the vision, mission and overall business strategy of the company. In
CUMI , the HR department is responsible for putting together the HR plan based on
corporate plan. It is responsible for recruitment, selection of employees, transfers, payroll
processing, canteen, and legal proceedings.
Human Resource Planning is done with the 3+1+3 business plan (3-past 3 years
performance, 1- current year performance,3-forecast of future 3 years performance). The
GM
HR MANAGER
HR EXECUTIVE
DY HR MANAGER
STAFF
43

company evaluates the HR requirements estimated by a series of analysis. The basic objective
of this department is effective utilization of Human Resource, desirable working relationship
among all employees and maximum individual development. The most appreciating feature
of CUMI is its profound flexibility in communication between any subordinate and superior.
This contributes to a friendlier cooperating environment. CUMI has a group of very
committed employees. It has strength of 44 permanent employees, 21 management staff, 65
non staff, 21 temporary trainees and 16 contractors.

HUMAN RESOURCE STRATEGY
CUMIS business strategy is evolved from Domestic and global market trends,
Economic growth competitor analysis and customer Industries growth plan .HR strategy
is linked to the the business strategy and facilities organization to achieve by building
people capabilities
CUMIs concern for people has been driving force for the growth of the organization
over the years attribute last 5 decades. The sustained growth over the past several years
attributed to the knowledge, skills of the people and technology. HR has been one of the
focus points in the business strategy.
The HR strategy is carefully linked to the vision, mission and overall business
strategy of the company
HR Values
Concern for people
Integrity
Customer orientation
Continuous improvement
Executive excellence

44

HR Principles
Whether workers or management staff, employees are employees. They are not
different bloc, but two faces of the same coin.
Employee Unions are treated with respect and are partners in the progress.
Harmony and peace cannot be at the cost of dilution of organization ethos.
Fairness and firmness will govern all employee relations.
Communication and dialogue would be the essence of managing relationships.
A proactive approach and a state of mental and physical preparedness would help
in managing unpleasant issues.
HR Functions
Recruitment & selection.
Preparing appointment letters.
Arranging training and development programs for the employees.
Keeping all statutory obligations.
Collecting data from all other factories to enable them prepare details for long
term negotiation.
Informing the concerned department about the change of factory rules & other
related acts.
Maintaining strict discipline.
Making daily attendance of the employees, pay and overtime, this department also
does all correspondence relating to the ESI and PF.
Running of canteen
. Recruitment & Selection
Recruitment and selection is based on integrity, competency and the ability to work in a
team. Company takes value fit individuals with group into consideration. Individuals are
placed under 1 year probation in which the superior accesses his/her abilities, teamwork,
and performance in pressure situations. But successful completion of probation does not
imply on assurance for permanent employment. Based on experience and qualification
selection of managers is done at the Head office, Chennai. The management gets people
through campus recruitments, personal references etc.
45

The selection procedure consists of:








Line managers are expected to prepare job description and job specification in respect of
job to be filled, HR department is expected to oversee and ensure proper compliance with
statutory and organizational requirement and policies. The recruitment process is a three
tier method-direct, indirect and third party. The sources of recruitment included both
internal & external. The internal source includes transfer and promotion, which is more
preferred by the company. The management chooses external source like campus
recruitments, personal references etc.
Induction
The workers are recruited and selected is given an individual program; introducing them
to the plant, their work and to the concerned department. For managerial personnel, the
induction method used is apprenticeship-training method; immediate supervisor trains
employees. For workers shop floor training is given. There is three level of induction at
CUMI:-
Corporate induction: mainly for corporate personnel. Given in Head Office (Chennai).
Induction across unit: Given for management staffs across the units in order to know
the various dynamics exist in the group.
Aptitude Test
Personal Interview
Final Interview
Group Discussion
Medical Checkup
46

Department/functional unit induction: This is given for both management and non-
management staffs; each department managers or supervisors give this.
Training and Development
The need for training is determined by identifying the gap between present performance of an
employee and the desired performance. In CUMI, it is done on the basis of skill matrix.
Training needs identification procedure:











Skill Matrix:
The objective of the skill matrix is to have a scientific analysis of skill level. The aim is
that technology changes fast and new technology demands new skill. Therefore, this helps
employees to progress his career plan. Skill matrix measures five aspects of an
individual/personal characteristics, discipline, skill work performance and participation in
management. The skill matrix is to find out the attitude of individual towards work and
Business Plan/ Long Term Strategy
Policy Deployment
Skill matrix for operatives/ Competency
requirement for managers
Competency gap
Training need identification
47

the skill of the person to perform. It is to identify scientifically the skill level existing in
the organization and to develop the skill levels pattern to meet the business requirements.
In skill matrix, the department head and the employee are rated based on certain
parameters. In rating the performance, it is classified into three -good performance,
average performance and poor performance.
Training for Management staffs
Two functional and one Personal Effectiveness Training Program as a part of
corporate initiative.
Specific program against the requirement- Division/unit HR.
Advanced TQM orientation
Negotiation skill.
Out bound training.
SHE programs.
Training for non-management staffs
Behavioral training
Skill improvement training
Multi tasking
Process orientation
Energy management conservation
TQM orientation

The funded needed for training both management and non management staffs is been
provided from the head office .the evaluation of training through an ERP software called
RAMCO. The performance of the employees evaluated every month through this
software. Based on the performance level they can know the effectiveness of the training
programs


48

CUMIs policy on HRP
CUMI will recruit based on integrity , competency and the ablility to work in a team. We
would also endeavour to select individuals with leadership potentials, customer
orientation and quality focus. Above all, we also take the value-fit of the individual with
the group in to consideration.
POLICY AND CARRIER PLANNING:
CUMI believes that its our responsibility to develop employees to their potential so that
the future challenges could me met with existing talent
DEVELOPMENT PLAN
The 3 Cs of retention of talent at CUMI
Challenge
Compensate
Competency
Areas-operational /cultural excellence


Performance management system

The performance management system is based on the score card.

The balance score card is the culmination of the business plan and is the complete
strategic map which identifies the strategic indicators and thrust areas of the business.
This balance score card is the authentic document approved by the Murugappa
Corporate Board. Based on the approved score card the functional score card are
evolved.

The monthly plans are then evolved from the above. These plans are reviewed on a
monthly basis against the plan.
49


The feedback and the learnings from the monthly reviews and course corrections are
incorporated.

The Performance Management System is on line with Policy Deployment.

The system is designed to capture the objectives and measures in the policy
deployment table drawn up for the current year.

The objectives and measures are to be clear cut, specific and quantifiable.

The appraiser and the appraise will jointly discuss and arrive at the best regrouping
possible of the objectives.

In the discussions, the appraiser and the appraise agree on a action plans including
resources and support. This is summarized and signed off by both the appraiser & the
appraise.

A review mechanism is also built in the system to ensure frequent monitoring of n and
course correction, if necessary.

The review calendar is drawn up to regularly monitor the progress of the objectives
and provide resources if any on the part of the appraisee

Control charts are maintained at agreed frequency and reviewed.

COMPENSATION
CUMI believes that compensation should be based on the individual performance is
classified through quantifiable/objective. The performance rating will be:
Exceptional contribution
50

Significant contribution
Good contribution
Not meeting the requirement
Not suitable
PERFORMANCE LINKED INCENTIVES:
The incentive, a part of the compensation and linked to balance Score Card helped CUMI,
iniative process of :
Rewarding stretch effort and risk taking
Encouraging inter functional and organizational perspective
Providing trust to sustainable processes
Giving inputs to innovation and learning
Incentives are an important and integral part of the compensation package. It would be based
on the achievement of the company/ SBU Score Card, with age specification for each
perspective
REWARDS AND RECOGNITION
CUMI has evolved a rewards and recognition scheme.
Kaizen Scheme: The objective of the scheme is to encourage and recognize management
staff for their participation and contribution in work /method/productivity improvement and
cost reduction exercises which benefit the organization.
This scheme is applicable to all management staffs up to MG6 including management trainee
category of CUMI for their individual contribution.
Suggestion Scheme: The objective of the suggestion scheme is to encourage and recognize
employee for their participation and contribution in work/method/productivity improvement
and cost reduction exercises which benefit the organization . This scheme is applicable to all
operatives of CUMI for their individual contribution


51

AREAS OF SUGGESTIONS:

To improve production or productivity
New methods or devices improvement for simplification
To improve quality of product or maintenance of services
To improve general; upkeep and cleanliness
To eliminate wasteful practices
To eliminate pilferage of materials
To improve process
To reduce cost
Performance appraisal
The methods used in CUMI are supervisory rating and self-rating. Performance appraisal
for the managers is called Policy Deployment. This system is based on factors like
business result, quality systems, total employee involvement, waste elimination and
customer satisfaction etc. In this system, the objectives of the GM will be the measure of
his next subordinate and this flow down accordingly until the final objective is attained.
The Performance Management System is based on the Balance Score Card .The Balance
scorecard is the culmination of the Business Plan and is the complete strategic indicators
and thrust areas of business. Appraisal for staffs consists of knowledge of methods and
procedures, quality of work, attendance and punctuality, resourcefulness, good manners,
team spirit etc.
Promotion Policy
Suitability and merit with number of service years are the criteria for promotion.
Promotion policy has been drawn taking into consideration of performance and seniority.
. Workers participation in management
CUMI takes suggestions from employees mainly relating to the cost reduction. The better
suggestions will be considered by the management and rewarded properly.

52

Salary payment
CUMI paying salary to employees through SBI Bank on 7
th
of every month .

Welfare Measures
Welfare Fund: Employees will contribute Rs.39 per month to the welfare fund. If the
employee is sick for more than two month, Rs.1400 will be granted. In case of serious
accidents or death, entire amount will be borne by the company. Cash award will be
given to the children of employees who secure highest marks in the SSLC exam.
Medical Scheme: Staffs who are not under the E.S.I scheme can avail this scheme.
The scheme is to provide financial assistant to the employees who have crossed the
ESI.Act and is not entitled for any other benefit from any other scheme. The ceiling
amount of this scheme is Rs.25000, amount will be granted only for inpatient
treatment. For out patient treatment amount within Rs.1800 will be reimbursed. Three
other members in the family can avail this scheme.
Recreation Club: CUMI has a library, there is a wide collection of novels and other
books, Television, newspapers ,company magazine (CONNECT) etc. Club conducts
sports and games. The club also conducts family tour programmes every year. The
club also celebrates annual day (which will be Dec/Jan) and Onam festival.
Canteen: CUMI has a subsidized canteen. Monthly Rs.18 is deducted from every
employee towards canteen. The company appoints suppliers and they are nine in
number. Purchase regarding the canteen is done by the company itself.
Dispensary: First aid is given in case some accidents happen. A register is
maintained in the dispensary and some of the medicines are stocked. There is no
permanent doctor, but only a visiting doctor who comes every three days in a week
and one compounder. Periodical medical check up is conducted in the dispensary and
the employees are given an amount as medical allowance. The employees are insured
under a group insurance scheme.
Uniform: Company provides uniform and foot wear to the employees every year. For
those who work in plants three pairs of uniforms and a pair of shoes will be given
once in a year. Those who work in sledging division in every 4 month a pair of dress
53

and shoes will be given. The company also pays Rs.110 towards stitching charge.
Both the management and operative staffs in CUMI has the same uniform.
Birthday celebration: The Company celebrates the birthday of their employees.
Company gives a pack of sweet and a birthday cards to the concern employee.

Allowances:
Washing Allowance
Shift Allowance
Travel Allowance
Educational Allowance
Attendance Bonus
House rent Allowance
Feeding allowance
Festival Allowance.
Grievance handling
Company policy:
Redressal of day-to-day grievances can motivate employees to be more effective.
Grievances should be settled reasonably, swiftly and transparently.
Welfare benefits:
Welfare fund:
Management agrees to contribute towards employees welfare fund at the rate of Rs.15.00
20.00 month with effect from 1st September, 2006.
Advances:
Management agrees to increase advance from Rs.5750.00 to Rs.7500.00 per annum,
which is to be paid in three installments of Rs.6000, Rs.3500 and Rs.1000 as Onam
advances and school advances and special advance respectively.

54

Safety shoes:
Additional one pair of safety shoes per year to plant operatives considering safety
requirements.
Leaves:
(a) Earned leave - strictly as per factory act
(b) Casual leave - Maximum 13 days per annum
(c) Medical leave - Maximum 12 days per annum

Hospitalization schemes:
Scheme for employees, spouse children. Introduced for those employees who are out of
purview ESI scheme consequent to exceeding the prescribed salary limit of Rs.10, 000
Tour subsidy:
The annual tour subsidy is revised from 5,500 to 10,500. Terms and conditions
unchanged.
Wages and allowance:
Applicable to all permanent employees with effect from 1
st
September, 2006
Dearness allowance:
DA is revised from Rs.4.35 to Rs.4.78 per point over and above 83 points of the
consumer price index (1970=100) published by the Director of Statistics, Kerala for
Ernakulam.
House rent allowance:
The house rent assistance is revised from Rs.390.00 to Rs.554.00 per month

55

Conveyance allowance:
The conveyance allowance is revised from Rs.355.75 to Rs.523.75 per month.

Night shift allowance:
Revised from Rs.10.00 to Rs.15.52 per shift for those who work between 4 pm and 12
midnight shift.
Revised from Rs.13.00 to Rs.19.88 per shift for those who work between 12 midnight and
8.00 am

Attendance bonus:
An amount of Rs.50.00 per month will be paid to eligible employees in addition to the
present practice of paying one day basic pay as attendance
Incentives:
Normal maximum amount earned for good performance per month is Rs.660. variable
pay base on 3 criteria namely process criteria, company criteria and individual criteria.
Overtime:
Overtime allowance is given to the workers on the basis of mass hours.
Overtime=Basic+ DA *attendance hours/240
. Trade unions
Carborundum Labour Union
Carborundum Employees Union

56

Industrial relation
In CUMI, the HR department plays a vital role in maintaining harmonious industrial
relations. A very good relationship exists between the management and the employees.
Since1987, no strike were reported. Inter as well as intra union rivalry is very low.

Slogans
Energy is the power that drives every human being to triumph
If you cannot measure it , you can not improve it












57

4.3. ACCOUNTS DEPARTMENT





The main finance department is the main branch at Eadappally. It prepares trail balance, MIS
and audit report. The financial department uses Ramco Virtil Works (RVW).
The accounts department does book keeping, accounting and reporting functions. It
undertakes the work of pay sheet preparation of staffs and workers, payment of bills,
vouchers and other financial transactions. They also prepare financial reports of the
company. All the major financial decisions are taken at corporate office (chennai). This
department also keeps income and expenditure accounts, which includes the sale and disposal
visible cost, contribution, fixed overheads, operating and non-operating income etc.
The corporate office provides funds for working capital requirements. Departmental
budgeting is also the function of accounts department.
Duties of accounts assistant is cash transactions, accounts payable, payment of tax. Trial
balance, capital expenditure are maintained by supervisor. Responsibilities of the manager
a/c are making monthly report, auditing and fund management etc. AGM a/c has the full
responsibilities of accounts department.
Major functions of this department are:
Keeping depreciation account.
Preparation of income and expenditure account
Preparation of budget for three years.
Departmental budgeting
ACCOUNT MANAGER
ASSIST
ACCOUNT
STORE
SUPERVISOR
58

Prepare management reports
Coordinating the auditing functions
FIFO method used to dispatch stock
Spare part planning undertaken
Item wise accounting and control of various inventory items
Responsible for purchase of mechanical spare


Capital structure:
CUMI capital structure consists of equity share capital, preference share capital, reserve and
surpluses, long-term loan, other loan and deferred tax liability.
Sources of funds:
CUMIs main source of fund is from the corporate office (Chennai).Issuing of share and
short-term loans from the companys consortium of banks like State Bank of India are the
other source of funds.
Earnings from the operation:
Last year companys operating profit and profit before interest and tax (PBIT) were 13.93
crore. In addition, the net profit was 5.55 crore.
Future investment proposals:
CUMIs investment proposal is 1500 lakhs for capital planning. It includes 100 lakhs for
mine purchasing, 500 lakhs for the application of tilled furnace, 500 lakhs for the large-scale
production of semi friable products and 400lakhs for miscellaneous.
Every 3
rd
of the month cash flow statement, Flash Report consisting of sales contribution,
contribution percentage, fixed expenditures, Profit before Interest and Tax (PBIT) and 8
th
of
every month Management Information System of profitability and Capex progress, Balance
Sheet statements are sent to Corporate Office.
59

Accounting policies:
The company policy has a special accounting policy, which is the basis of the financial
statement. It is in accordance with the accounting standards issued by the Institute of Charted
Accounts of India.
Deferred revenue expenditure:
Preliminary expenses are amortized over a period of 5 years.
Revenue recognition:
Both income and expenditure are recognized on accrual basis. At the end of the accounting
period, works in progress are recognized as revenue based on proportionate completion
period.
Foreign currency transaction:
Transactions of foreign currency are recorded at the rates of exchange prevailing on the date
of transactions and the exchange loss or gain is recorded within the profit and loss account.
Depreciation:
Earlier days Company adopted Written down Value Method. However, the management felt
that straight-line method would be more appropriate. So from 2000 onwards they adopted
Straight Line Method.
Investment:
It is meant to be held for long term is accounted at cost.
Fixed assets:
Fixed assets are stated at a cost of acquisition and subsequent improvement thereto inclusive
of taxes, dues, freight, and other incidental expenses related to acquisition, improvement and
installation.

60

Borrowing costs:
Borrowing costs are capitalized as part of qualified fixed assets when it is possible that they
will result in future economic benefits.

Inventories:
Inventories are valued at lower of cost and net realizable value. Cost includes all direct costs
and applicable production overheads to bring the goods to the present location and condition.
Excise duty on the finished goods is added to the cost.
The company also holds a special Murugappa economic value added method for better
operating profit, faster sales growth reduction in incremental fixed capital, reduction in
effective tax rate and lower WACC.

Retirement Benefits:
The contribution of gratuity fund is based on an annual valuation and to the superannuation is
funded to LIC of India.
Capital structure:
CUMI capital structure consists of equity share capital, preference share capital, reserves and
surplus, long-term loan, other loan and deferred tax liability.








61


STORE

The main function of store is procuring the raw materials and other required materials for the
company. This department invites quotation from various suppliers and make a vendors list
on the basis of some criteria.
This department also rates the each vendor based on their previous experience, quality of the
product, delivery speed and price, which is called vendor rating.

This department issues materials as per the order given by the concerned department through
material requisition. If the required material is out of stock, the commercial department head
invites quotations from the vendors. The best quotation is chosen and the purchase order is
placed. On the arrival of the material, it is checked and issued to the concerned department.

Purchase procedure:


















Purchase request
Authorization
Quotation
Planning Purchase order
Material collection
Payment for the material
Takes the least quotation
Inspection of material
62

Purchase request: If the departments require any materials, they will place a material
requisition to the commercial department. If the required material is not in the store, the store
manager places a purchase requisition (PR) to the plant manager.
Authorization: Purchase requisition is checked by the plant manager and approved for the
quotation.
Quotation: Department invites the quotations from the vendors.

Takes the least quotations: department selects the least quotations
Purchase order (PO): department takes the least quotations with the consideration of their
previous experience, quality of the product and delivery speed then placing a purchase order
to the appropriate vendor.
Material collection: When the materials are reached to the company, the store supervisor
inspects the materials and then issued to the concerned department.

Store:
The main raw material are quartz and raw petroleum coke supplied mainly by Tamil nadu
and Gujarat . The company is considering purchase from other sources also. Every item is
attached with a Bin Card, which has UNIQUE CODE NUMBER consisting of 14 digits.
The card has description of the item, date of receipt, date of supply, balance, signature,
remarks and stock number.







63

4.4. SHIPPING DEPARTMENT

Arrangement of movement of material. Marketing material is not undertaken here. This
department also maintain stock of finished goods.
3Types of dispatches
Captives dispatch(Branch Transfer about 50% )
Domestic Sale(with India)
Exports


GENERAL MANAGER
JUNIOR OFFICER SHIPPING
TRAINEES
SENIOR MANAGER
SHIPPING
64

Functions of shipping department
Customer interaction, customer visits, quotation preparation and submission
undertaken by department
Order receipt and order acknowledgement onwards entails responsibility of shipping
department
Transporters are employed as they absorb liability in relation to vehicles and drivers
Invoice, Gate pass, Declaration in 8f and Lorry receipt are to be maintained for
domestic sale
The transportation of domestic and captive sales is arranged by shipping department
as per the customer authorized transporter
For export CUMI arranges containers for house stuffing at Koratty plant as per the
supervision of central Excise officer
Stuffing report, Commercial invoice are document maintained for export.
This department is responsible for the packaging of finished products. They start dispatching
only after getting the green card from the quality control department. This department has
also the responsibility to determine the number of casual workers required for the loading and
unloading function. However there is a forklift to do major part of the loading work. This
department also in charge of preparing invoice.
Then it is packed in various quantities. In every shift 210 bags weighing 50 kilograms
(domestic purpose) and 25 kilograms (export purpose) is packed. The bags are placed in
pallet and lifted by Crain and taken to separate area from where trucks carry it to
destinations.
Main customers:
The main customer industries of the CUMI are:
Automobile industry.
General metal cutting industry.
Polishing of metal surfaces.
Marine paints etc.

65

And the main customer companies are:
Vishwa vishal.
Mechans in UK.
Milthon
Indoflogates.
Tata refractories.
Branding:
CUMI made its brand well known in the industry through continuous hard work and
determination. This was possible because of the following reasons:
Consistent high quality and reliability
Fair pricing practices and transparency
Relationship management
Customized product variants
Sales:
Ninety percentage of the sale is done through direct orders from the customers and 10
percentages is from the dealers. Last year the companys domestic sale was around rupees
42.35 crore and the export sale was around rupees 9.5 core.
Distribution:
CUMI has no formal warehouse. They distribute their products directly to the consumers.
Pricing strategy:
In the domestic market, the company sells products at premium price. However, in the export
market the company facing great competition from the Chinese products so in this market the
company sells the products at economic price.
Promotion:
Promotion is done using the broachers, brand name, technical journals, and magazines,
yellow pages of the internet and relationship management.
66

Competition:
Price and quality are the major competitive parameters in this industry. In the domestic
market, company divides the entire market into four regions i.e. north, west, south and east.
Each manager is being responsible for sales in the particular region. Last year the companys
domestic sale was around 42.35 crore. In the Indian market, 35 % of the share is from CUMI.
The main competitors of CUMI are Graind well Norton, Snam abrasives and Orient abrasive
.In the export market, the company focuses on Germany, Philippines, Italy, Spain, Saudi
Arabia, Japan, UAE, USA, and South Africa.




















67

4.5 .SYSTEMS DEPARTMENT













The electro minerals division at Koratty is becoming more automated and technocracy. In
this company, each department uses computer and is interconnected with the help of ERP
(Enterprise Resource Planning) system.
Ramco Virtual Works, a Chennai based software company provides ERP solution The
company uses ERP because it provides:
Integrated market information.
Better handling of raw materials
Better process control
Reduce the time and cost
To record the details of HR
Integrated financial information
The companys entire work, raw materials to marketing of the finished good is influenced by
the ERP. If any department is facing any problems, that information will spread to the entire
organization and then the concerned person or department will approach and solve that
problem within the shortest period. These are done with the help of ERP.CUMI has internet,
which is easily accessible. The type of net work is used by the company is Star Network.
GM
System
Administrator
System
Operatives
System
Operatives
System
Operatives
68

Office automation facilities are provided by Ramco Virtual Works. It is Chennai based and
perform the activities like Payroll service, shipping and updates etc.
Type of server
Exchange server for mail transcription. Front end sever is based on Chennai and the back-
end in CUMI, Edappally. Internet connectivity-Broad band-256kbs.Types of operating
systems are used by the company is Windows 2003 and Windows professional.
Security systems
1. E Scan - that act as an anti virus
2. Fort guard - This blocks the unwanted websites.

URL : http://tvtnet/cumiweb/intranet/home/index.html

IP ADDRESS : 121.243.115.163


WEBSITES
http://www.cumi-murugappa.com/
www.cumi-emd.eu













69























CHAPTER 5

SWOT ANALYSIS


















70

SWOT ANALYSIS
STRENGTH
The company provides value for money to the customers through their better quality
and innovative products.
The company treats customers with respect and concern
The company has got strong R& D department, which have a policy that 6% of total
sales every year should be from new products. R &D enables the company to have an
edge over competitors in the new product development.
The company has got professionally managed sales team with strong back up of
reputed dealers.
ISO 9001: 2008 certification also helps in obtaining some orders as well as
maintaining the standard of the company.
The greatest strength of the company comes from the employees who are efficient,
energetic and sincere. Dynamic top level management backs them. There is no barrier
between management and workers.

WEAKNESS
The salinity of water has to be improved.
.The roads within the company are to be developed so that men and materials can be
moved easily.
Promotion is based on the seniority not on performance
OPPORTUNITIES
The company can introduce more of its products in the market.
The company can produce new and improved products with less labor and advanced
technology.
More mines have to be found out.
Globalization and liberalization can make its products globally acceptable.
The company can employ best brains from top business and technical institutions for
better working and management.
71

THREATS
CUMI faces stiff competition from world majors and local players.
Power and other equipments are expensive.
The demand for abrasives has fallen down because of industrial and economy
slowdown.
European financial crisis .

































72























CHAPTER 6

CONCLUSION


















73

FINDINGS

Has a good organizations structure and management system
Provides better working conditions to workers
Growth possibilities
Adequate storage facilities
Experienced employees
Monopolistic nature in Kerala
Effective incentives system























74

CONCLUSION

CUMI is an ISO 9001 :2008 certified company. It is an excellent employer and producer of
world class abrasives and refractorys. This has happened only with the support of staffs and
workers in the company. The management is dynamic and supportive and patiently the
workers voices and acts accordingly.

For my study I visited Plant I producing silicon carbride and interacted with some of the
employees there. I could also interact with management staff who provided me with adequate
knowledge regarding various departments in the company . All the staff are very co-operative
. The study has helped me to know the objectives, vision and mission, values , rules and
regulations followed by the company. Company follows Japanese concept of housekeeping
- 5S programmes .

The privileged opportunity of doing four weeks long organization study proved out to be
highly beneficial in the learning point of view. It gave a practical knowledge about the nature
of the business firm and it had enabled me to have an exposure to the majority of the topics
related to company functioning, structure , policies , promotional activities , working
environment, organizational culture etc. It has also helped me to acquire the practical
application of the theories studied in the class room ..













75
















APPENDIX






















76

BALANCE SHEET
(standalone )

BALANCE SHEET (Rs. In million)

As at
31.03.2012
As at
31.03.2011
EQUITY AND LIABILITIES
Share holders s Funds
Share capital
Reserves and Surplus
187.40
6178.54
186.94
5095.30
6365.94 5282.24
Non current liabilities
Long term Borrowings
Deferred tax liabilities
558.48
425.30
1163.78
420.58

983.72 1584.36
Current liabilities
Short term Borrowing
Trade payable
Other current liabilities
Short term provisions
409.34
791.30
1206.58
246.62
482.72
834.59
1110.42
138.89

2653.84 2566.62
Total
10003.56 9433.22
ASSETS
Non current assets
Fixed assets
Tangible assets
Intangible assets
Capital work in- progress
Non current investments
Long term loans and advances
3822.35
30.94
272.54
1245.68
257.96
3690.44
41.68
142.16
1640.56
186.86

5629.47 5701.70
Current assets
Current investments
Inventories
Trade receivables
Cash and Bank balances
Short term loans and advances

100.00
1876.88
1847.16
104.23
445.82

-
1548.04
1772.18
78.16
333.14

77



4374.09 3731.52
Total
10003.56 9433.22






























78

BIBLIOGRAPHY


REFERENCE BOOKS
L R Potti: Research Methods, Yamuna Publication
P.C. Tripathi, P.N. Reddy: Principles of management, Tata McGraw Hill, 2
nd
Edition,
2001
Philip Kotler, Gary Armstrong: Principles of Management, Tata McGraw Hill, 2
nd

Edition, 2001


JOURNALS
Company magazine ( CONNECT)
Brochures and Leaflets published by CARBORANDUM LTD
Annual report

WEBSITES
http://www.cumi-murugappa.com/
www.cumi-emd.eu