1 CONTENTSSERIAL DETAILS PAGE NO NO I CHAPTER 1 INTRODUCTION 2 INDUSTRY PROFILE 3 COMPANY PROFILE 7 PRODUCT PROFILE 14 II CHAPTER II DESIGN OF THE STUDY 17 SCOPE OF THE STUDY 17 OBJECTIVES OF THE STUDY 18 LIMITATIONS OF THE STUDY 18 III CHAPTER III QUALITATIVE ANALYSIS OF THE 20 STUDY IV CHAPTER IV FINDINGS 47 SUGGESTIONS 48 CONCLUSION 49 BIBLIOGRAPHY 50
4 INTRODUCTION An organization is a social arrangement which pursue collectivegoals, which controls its own performance, and which has a boundary separating it from itsenvironment. Organization is the association formed by a group of people who workedindividually or in groups to achieve common set of goals.Organizational studies are the study of individual and group dynamics in an organizationalsetting, as well as the nature of the organization themselves. Whenever people interact in anorganization, many factors come to play. Organizational studies attempts to understand themand hence it is essential to an MBA program as it helps them to connect theory with practice.As a part of the MBA program I an organizational study was conducted at OUSHADHI, toknow about the functions of an entire organization. The study was conducted for a period ofone month. The aim of the study is to acquire practical knowledge of the application ofmanagement theories in the functioning of the organization and it also helps in understandingthe organization structure and functions of various departments in the organization.
5 INDUSTRY PROFILEAYURVEDA PHARMACY. The pharmaceutical industry develops, produces, and markets drugs licensedfor use as medications. Pharmaceutical companies can deal in generic and or brandmedications. They are subject to a variety of laws and regulations regarding the patenting,testing and marketing of drugs. The earliest drugstores date back to the middle Ages. Thefirst known drugstore was opened by Arabian pharmacists in Baghdad in 754 and manymore soon began operating throughout the medieval Islamic world and eventually medievalEurope. By the 19th century, many of the drug stores in Europe and North America hadeventually developed into larger pharmaceutical companies. The industry remained relativelysmall scale until the 1970s when it began to expand at a greater rate The Indian Pharmaceutical Industry today is in the front rank of India’sscience-based industries with wide ranging capabilities in the complex field of drugmanufacture and technology. It ranks very high in the third world, in terms of technology,quality and range of medicines manufactured. The Indian Pharmaceutical sector is highlyfragmented with more than 20,000 registered units. It has expanded drastically in the last twodecades. The leading 250 pharmaceutical companies control 70% of the market with marketleader holding nearly 7% of the market share. It is an extremely fragmented market withsevere price competition and government price control. Ayurvedic Pharmacy (AP) is emerging as an independent science largely dueto global acceptance of Ayurveda. Ayurvedic Pharmacy is not new subject and has recentlyit has faced drastic transition. Ayurvedic Pharmacy has roots in Dravyguna, Ras-Shastra andBhaishjya Kalpana. Ayurvedic Pharmacy utilizes drugs of composite origin including plant,animal, mineral and marine sources. Ayurvedic medicines are produced by several thousandcompanies in India. It is estimated that the total value of products from the entire Ayurvedicproduction in India is on the order of one billion dollars. The industry has been dominated by
6less than a dozen major companies for decades, joined recently by a few others that havefollowed their lead, so that there are today 30 companies doing a million dollars or more peryear in business to meet the growing demand for Ayurvedic medicine. The products of these companies are included within the broad category of "fast movingconsumer goods". Most of the larger Ayurvedic medicine suppliers provide materials otherthan Ayurvedic internal medicines, particularly in the areas of foods and toiletries, wherethere may be some overlap with Ayurveda, such as having traditional herbal ingredients inthe composition of toiletries. The key suppliers in Ayurveda are Dabur, Baidyanath, andZandu, which together have about 85% of Indias domestic market. Exports of Ayurvedicmedicines have reached a value of 100 million dollars a year. About 60% of this is crudeherbs, about 30% is finished product shipped abroad for direct sales to consumers, and theremaining 10% is partially prepared products to be finished in the foreign countries.AYURVEDA: THE SCIENCE OF LIFE.Ayurveda is a science which indented to benefit the entire world. In ancient India it wasconsidered as a great science in touch with Indian philosophical thoughts and its tenets werefound highly beneficial as a system of medicine. Ayurveda aims physical, psychological andsocial welfare of living being. It envisages the means of preservation of health, preventionand treatment of various ailments. Approach of Ayurveda is field oriented, holistic andfunctional. This science of life utilizes wealth of nature for increasing the resistance of thebody and treats man as a whole and uses drug as a whole as well. Ayurveda vies thatsuccessful medical treatments depends upon four factors-the physician drugs or diets, nurseand patients. The objective of the science of life is establishing the equilibrium of bodyelements. Ayurveda favors administration of natural raw drugs and their preparation.Generally Ayurvedic medicines cause no toxic or side effects, no question of tolerance,resistance and addiction.PHARMACEUTICAL SCIENCE OF AYURVEDA. The pharmaceutical science of Ayurveda deals with the preparation of effectiveremedies for the eradication of diseases and preservation of health. Pharmaceuticalpreparations are made with a view to make the drug more potent, preserved and clinicallyeffective. Mode of preparation plays an important role in the absorption of drugs.
7SCOPE OF AYURVEDAAyurveda has dealt with anatomy, physiology, Etiology, Pathology, Therapeutics,achievements of good health, hematology including the stage of the disease, physicians,therapies including wholesome locality and procedure. The body is composed ofpanchamahaboothas and divided into several organs. Its multifarious functions aremaintained and regulated by the food that one takes. The unwholesome contact with sense,intellectual blasphemy and seasonal variations constitute the etiology of the diseases. Thedisturbance of the equilibrium of the dhatus is responsible for the causation of the diseases.Different seasonal changes and the different stages of the manifestation of diseases, constitutethe time (Kaala). The procedure of treatment to be followed depends on the time, the diseaseand the drug.AYURVEDA IN INDIANative to India, Ayurveda is the ancient medicinal form, developed during the Vedic times,about 5000 years ago. The word Ayur means life, while Veda means science. Therefore,Ayurveda literally means the Science of Life. It is not just a medicinal system, but also away of life. Ayurveda deals with the physical, as well as spiritual health. The medicinal formis governed by the laws of nature, which suggest that life is a combination of senses, mind,body and soul. According to the science of life, the structural aspect of every individualcomprises five elements- earth, water, fire, air, and space. While giving Ayurvedic treatmentto a person to cure a particular disease, the physical, mental, emotional and spiritual well-being is taken into consideration. The best part of acquiring an Ayurvedic treatment is that ifthe prescribed doses of medicine are taken, the diseases can be cured in the most effect way.The Ayurvedic medicines generally come in the form of powders, tablets, decoctions, andmedicated oils, that are prepared from natural herbs, plants and minerals. In addition, thediseases treated and cured by Ayurvedic medicines do not cause any side effects.According to Ayurveda, the structural aspect of every individual is made up of five elements- earth, water, fire, air and space. The functional aspect of the body is governed by threebiological humors. Traditional techniques and processes are used to prepare the medicines athome, while certain amount of mechanization is inevitably used for large-scale production.The beauty of the therapeutics is that they contain the active principles in their natural forms
8and their administration in prescribed dozes does not cause any side effects to the patients.Ayurveda gives a complete look into the lifestyle of a person, like starting from his/herpersonality to the daily food habits. The Science of Life helps us in understanding eachindividual at a very subtle personal level and giving a detailed description about the diet,daily routine, lifestyle, actions and activities to be followed. The science teaches how to livelife in a balance way. Ayurveda aims at having a healthy and happy society, free fromdiseases. India has gained worldwide recognition for its indigenous and extensive Ayurvedictreatment. Various centers are established throughout the length and breadth of the country,wherein authentic Ayurvedic treatment is given. Kerala is the hub of Ayurvedic treatments inIndia. Ayurvedic treatments soothing effect on the body and soul has attracted tourists fromdifferent parts of the country as well as from across the globe. This has proved a boon fortourism in the states of India, especially Kerala, where Ayurvedic treatment is given atvarious health centers and tourists resorts.STATUS OF AYURVEDA IN INDIA • Number of registered medical practitioners: 366,812 • Number of dispensaries: 22,100 • Number of hospitals: 2,189 • Number of hospital beds: 33,145 • Number of teaching institutions (undergraduate): 187 • Number of upgraded postgraduate departments: 51 • Number of specialties in postgraduate medical training: 16 • Number of pharmacies manufacturing Ayurvedic medicines: 8,400MODERN MARKET DEVELOPMENTS
9The SAARC- South Asia Association for Regional Cooperation which include India,Pakistan, Nepal, Bangladesh, Bhutan, Maldives, and Sri Lanka- These countries all have beeninfluenced by Ayurvedic medicine. Trade in Ayurvedic medicines within the SAARC ismostly limited to raw materials that grow in one region (e.g., high mountains, northernclimate) and are then exported to other regions. Because of the large number of very smallfactories that try to service the local communities, with products labeled with the locallanguage, there is little opportunity for suppliers in one SAARC country to send finishedproducts to another SAARC or even abroad. Entrepreneurs in these countries, mainly inIndia, are seeking to break into the market for natural products have determined that thedemand for traditional style Ayurvedic medicines both inside and outside the region islimited. They have aimed to bolster interest by carrying out scientific research into promisingherbs and formulas that are based on Ayurveda but not necessarily reflecting traditionalpractices. Of necessity, such research eventually focuses on finding of active ingredients, andthis has led to the development of isolates from plants that are sold as "nutriceuticals"-substances not registered as drugs, but used like nutritional and dietary supplements. Forthese, there is a growing worldwide demand. COMPANY PROFILEOUSHADHI.The Pharmaceutical Corporation (Indian Medicines) Kerala Ltd or Oushadhi is a herbalAyurvedic medicines production company under the direct control of Kerala Government.Directly controlled by Health and Family Welfare Department of Kerala State Governmentand is governed by a Board of Directors, appointed by the Government of Kerala. Originatedas Sree Kerala Varma Govt. Ayurvedic Pharmacy in 1941 at the instance of His Highness theMaharaja of Cochin, for the supply of medicines to Govt.Ayurvedic Hospitals in Thrissur anderstwhile princely family of Cochin State.In 1959 it is converted and registered as Co-operative Society, and named as Sree Kerala Varma Ayurvedic Co-operative Pharmacy &Stores Limited, No.4318, Thrissur. On 08.09.1975 incorporated as a company under theCompanies Act 1956 and renamed as The Pharmaceutical Corporation (I.M) Kerala Ltd,
10Thrissur and its operations started on 10.07.76 with the take over of the business of SKVACPharmacy. The company supplies Ayurvedic medicines to 1000 plus Ayurvedic treatmentcenters functioning under Kerala Government. Their medicines are also available in themarket. The company also supplies medicines to other state Governments in India.Madyapradesh, Rajastan, Haryana, Maharashtra, Punjab, Chathisgarh, Orissa, andPondichery.LOCATIONRegistered Office: Shoranur road, Thrissur, Kerala, South India.Factory: Kuttanellur, 8 Kms from Thrissur Town.Office: Kuttanellur, 8 Kms East from Thrissur Town.OBJECTIVES Manufacturing and Marketing of high quality Ayurvedic medicines Research and Developmental studies on Ayurvedic formulations. Supply quality ayurveda medicines to all Government dispensaries and hospitals in the state at subsidized price. Promotional activities on medicinal plants Cultivation. Health Care through Panchakarma therapy and Clinical Research Program. Implementation of Govt. of Kerala Health Care Programmes. To act as a price stabilizingFEATURES The company manufactures more than 450 Ayurvedic formulations asper ancient classical texts, rare combinations of expert, experienced Keralite authorities andspecial combinations developed in the Research wing. The company upholds ancienttraditional methods of manufacturing along with modern machinery and technology understrict quality control measures. The whole manufacturing activities are under the direct andexpert supervision by qualified Ayurvedic Physicians. Quality medicines are made availableto the public at reasonable price
11The company meets the entire medicine requirements of Government Ayurvedic Hospitalsand Dispensaries under the Department of Indian Systems of Medicines, Kerala.The pharmacy fulfils the demands from Directorate of I.S.M.Bhopal, Jaipur National Instituteof Ayurveda, Government Hospitals and Dispensaries under Central Government HealthSchemes, Employees State Insurance Medical Services, Government Ayurveda Colleges,Tribal Welfare Department, Govt. Ayurvedic Mental Hospital, Kottakkal, Government ofKerala ICDS Cell programs. Public demands are met through a network of 500 exclusiveOushadhi Dealers and Agents. The organization implements health care projects from Localbodies. Propagation of Ayurveda by establishing specific clinical practices all over India.Also implements medicinal Plants Cultivation program linked with local bodies andentrepreneurs under buy- back arrangement .There is a nursery development for theproduction of quality seedlings.The annual national conference aimed at education on medicinal plants is conducted underthe aegis of oushadhi. Continuing Medical Education for Ayurvedic practitioners is anotherpositive step by the company. It has a wide product range of more than 450 medicines, 15 ofthem are patented to the company. An Ayurvedic hospital with panchakarma treatmentfacilities is the latest development by the company.PANCHAKARMA HOSPITAL & RESEARCH INSTITUTE THRISSURThe Panchakarma Hospital & Research Institute is situated in Thrissur. The hospital providesmodern amenities like luxury furnishing, air-conditioning, special treatment rooms etc.Oushadhi Panchakarma Hospital and Research Institute is fully owned by KeralaGovernment. Ayurvedic treatment is a traditional phenomenon of India. OushadhiPanchakarma Hospital and Research Institute will be an attraction for people becausePanchakarma therapies are inseparable part of Ayurvedic management and can be called theessence of Ayurveda. As a part of diversification program, Oushadhi has entered in the fieldof health care to provide quality treatment to the public. Adhering to the traditional methods,Oushadhi offers most modem facilities for health care practices through OushadhiPanchakarma Hospital and Research Institute at the heart of Kerala’s Cultural capital,Thrissur.Global attraction towards Ayurvedic system of medicine, made hopeful chances toimprove the system. Panchakarma and related health care practices are the integral part ofAyurvedic system of medicine.
12HOSPITAL COMMITTEEA committee to advice Oushadhi on various technical aspects of hospital administration isconstituted. The committee includes experienced and respectable Acharyas from differentsystems of medicine, officials of Govt. departments, eminent persons in the field ofAyurveda, medical research etcMEDICINAL PLANTS CULTIVATIONThe pharmaceutical corporation functions as a nodal agency of the Govt. of Kerala for thepropagation of medical plants cultivation. Land available in factory premises is utilized fornursery development under NMPB fund, cultivation of species like Ashokam (Saraca indica),Raktachandanam (Pterocarpus santalinus), Vilwam (aegle marmelos), Amalaki (phyllanthusemblicus) and various projects from Kerala Forest Department and KFRI. Land available atPariyaram, Kannur District is utilized for cultivation of tree species and selected herbs andnursery development. Has held discussions with Aralam farm authorities for leasing 100acres of land for medicinal plants cultivation. Oushadhi Managing Director holds the chargeof Chief executive Officer for State Medicinal Plants Board.Objectives To meet internal demand. To establish demonstration garden of rare species and to preserve them from extinction. To develop nursery of Medical plants, make them available even to small land owners who can cultivate medicinal plants and thus increase their income.visionA Leading world class Ayurveda industry in the country by 2020.Core values • Mutual trust and respect. • Customer satisfaction.
13 • Quality control. • Professional ethics. • March with time.Strength • Established brand image. • Continuous government support. • Huge market demand. • Dedicated work force. Future plans. The future plans of the company include modernization of existing unit to improve quality and to meet the modern market requirement. Establishing branches in neighboring state to promote oushadhi. Establishment of export oriented production unit for selected high demanded item. Computerization of entire business. Establishment of new processing and value addition units. Strengthening of quality control and drug testing laboratory. Development of new drugs in neutraceautical,cosmetic and baby product segments. Promote medical plant cultivation and conservation. Purchase of raw materials raised by farmers through oushadhi agents spread all over the states through an effective buy back arrangement to encourage medicinal plant cultivation by farmers..
14MILE STONES Year Achievements. 1941 Commenced by His Highness of Maharaja of Cochin as Sree Kerala Varma Ayurvedic pharmacy. 1959 Converted in to co-operative society viz Sree Kerala Varma Ayurvedic Pharmacy and Stores Ltd 1975 Registered as a company under Indian companies act and renamed as The Pharmaceutical Corporation ( Indian Medicines) Kerala Ltd. 1991 Commissioned modern manufacturing unit at kuttanallor and shifted the factory to new premises. 2004 Started a new Phanchakarma Hospital and Research Institute at Thrissur. 2007 The entire office shifted to the factory premises at Kuttanallor. 2008 Commenced full fledged R&D center at kuttanallor and regional distribution unit at Kannur.
15 ORGANIZATIONAL STRUCTURE CHAIRMAN BOARD DIRECTORS MANAGING DIRECTOR FINANCIAL ADMINISTRA PRODUCTION MARKETING MAINTANANCCONTROLLER TIVE OFFICER MANAGER MANAGER E MANAGER 2 SALES MNGR ACO ASS. DEPU (AGENCY) ACCO UNT ADMN MGR TY MANA PROD SALES MNGR GER SR ASS N (GOVT DEPT) PR MAN PURCHASECASH MANAGER ASS.IER SR. SR. MGR ASS ASS WOR AM MANA MANA KKKKACCOU CLER STORES GERNTANT KS PROS WORK JR.ASS S TRAIN MANA EMPL EE DR GER OYEES SUPERVISER JR. ASS /FOREMAN MANGR MAINTANA NCE EMPLOYEES WORKER/ LGE
18 CHAPTER – 2DESIGN OF THE STUDYThe information and data were collected from both primary and secondary sources.Primary sources Direct interview with managers. Direct interview with supervisors and workers. Through direct observation.
19Secondary sources Published sources of the company. Official websites of the company.SIGNIFICANCE OF THE STUDY. To get a practical experience of working of an organization. Comparison of theoretical knowledge with practical knowledge. To know about the application of management studies in an organization. To know the strength and weakness of the organization.SCOPE OF THE STUDYThe organization study covers the following aspects: Present position of the company Overall functioning of the company Performance of the companyOBJECTIVES OF THE STUDY The main objective of the study is to acquire knowledge about the organization structure. To have a practical knowledge of the application of the management theories. To know the role played by the company in the industry. To know the profile of the company. To study the different departments in the organization. To study the techniques adopted by the company. To analyze the strength and weakness of the company.
20 To analyze issues of the company and give suggestions.LIMITATION OF THE STUDY As time was a major constraint, a research type in depth study could not be made.
21 CHAPTER – 3 QUALITATIVE ANALYSIS OF THE COMPANYFINANCE DEPARTMENT.Finance is the lifeblood of every business. The ambitious plan of a business man wouldremain mere dreams unless adequate money is available to convert them into reality.Financial function calls for skillful planning and control of various financial activities.Finance department play a vital role for the smooth functioning of the organization. Thisdepartment is involved in all the activities that take place in the organization. Marketingdepartment and production department have to greatly depend on finance department for theavailability of the fund. Financial controller is the head of the department.Organization structure of the department. Financial controller.
22 Accounts Accounts Purchase manager. officer wing. Cashier. Accountants . Stores.ROLE OF FINANCE MANAGER Allocating the fund provided by the Government to various departments. Keeper of books of accounts. Evaluate the effectiveness of financial decisions. Advice Managing Director in all financial and Accounts matters. Scrutinize and clear the financial proposals. Ensure that the expenditures are having proper sanction and within the Budgetary limit, Responsible for up to date maintenance of all records, returns and accounts. Preparation of Annual Budgets. timely preparation of annual accounts & All other related works connected with Finance and AccountsCONTROL PROCESS:Finance functions deals with procurement of funds and effective utilization of the fund in thebetterment of the business. Control over expenses is ensured by comparing actual expenseswith that of budgeted figures. By constantly monitoring various operational activities costcontrol and cost reduction are facilitated. Accounting functions involves day to dayaccounting of several transactions relating to purchases, inventories, production, sales, otherincomes, fixed assets, salaries and wages and other expenses such as manufacturing,administration, selling and distribution.
23PREPARATION OF FINANCIAL STATEMENTOne of the important responsibilities of the department is the preparation of financialstatement in a periodic basis and the interpretation of this statement. This is quite helpful forthe management in ensuring proper control over the performance of the company and also toframe up appropriate policy frame works. The finance department prepares the followingstatements Profit and Loss Account Fund Flow Statement BudgetBOOKS OF ACCOUNTS MAINTAINED BY THE FIRM. • Cash book • Bank book • Purchases book • Sales book • Journals • General ledger • Fixed assets ledger etcCASH MANAGEMENTCash is needed by the firm to meet its transactions precautionary and speculatingrequirements. The fund provided by the Government is managed efficiently by the firm. Forthis a budget is prepared for the proposed requirements of fund that will be needed by eachdepartment. The goals of the cash management are • To satisfy the day today business requirements • To provide for schedule major payments • To face unexpected cash drains.
24 • To build image of credit worthiness • To build the reservoir for net cash.ALLOCATION OF FUNDS TO VARIOUS DEPARTMENTSFinance functions deals with procurement of funds and effective utilization of the fund in thebetterment of the business. Allocation of funds held in this mill as per requirements andavailability. All the funds are allocated to various departments that is purchase department,store department, production department, maintenance department, marketing department,and administration department.PAYMENT AND COLLECTION PROCEDUREThe payment and collection of money held in finance department. By constantly monitoringvarious operational activities cost control and cost reduction are facilitated. The major supplyof the organization is to government. For a public organization government will provide fundif they had, and using the fund provided by the government medicines are produced and amajor portion are sold to government. For sales to agency, cash and carry system is followed.Credit sales are not allowed. As regarding to purchase of raw materials, purchases are doneby inviting tenders. Annual tender is invited and a credit period of sixty days are allowed ifimmediate payments are not made. Likewise in the case of installation of machinery also.After installation and commissioning the payment for machineries are made.MARKETING DEPARTMENT.Oushadhi is having a strong network of exclusive Oushadhi agents and dealers of about 600.These agencies are exclusive showrooms of oushadhi products. Distribution centers havebeen opened in New Delhi, Mumbai, Pondichery etc for catering outside Kerala Market.Oushadhi is the Principal supplier of Ayurvedic Medicines to Government AyurvedicHospitals and Dispensaries under Indian Systems of Medicine (Kerala)as well as to some
25other I S M department of Madhyapradesh Chattigarh,Rajasthan,Pondichery etc. also theorganization Supplies medicine to institutions like Govt.Ayurveda Colleges, MentalHospital,Kottakal etc. Supply of medicines to Government of Kerala Health Care programsfor contagious diseases. Extends supplies to Central Government Health schemes, ESIdispensaries, ministry of Labour & mining, Tribal Welfare Department etc.organization structure of the department. Marketing manager Sales manager. Sales (govt) manager(agency) Ass.sales manager. Ass.sales managr. Jr.managers Jr.managerMarketing is based on identifying, anticipating and satisfying customer needs effectively andprofitably. It encompasses market research, pricing, promotion, distribution, customer care,your brand image and much more. The mission of marketing of oushadhi aims at satisfyingcustomer needs. It integrates all the functions and parts of a company to serve the markets.Marketing connects the production and consumption functions. Oushadhi is gifted with anefficient Marketing system which shows how to create effective production systems andconsequently prosperity. In addition to economic and social responsibility, ecologicalresponsibility is also emphasized by the firm. Three major functions of are divided as-exchange function, which include buying, selling and pricing. Physical function whichinclude assembling, transport and handling, storage and handling, grading and
26standardization. Facilitating functions include financing and risk bearing, market informationdemand and supply creation and market research.THE POWERS AND DUTIES OF MARKETING MANAGER ARE: Evolve strategies for effective marketing of products Prepare Sales targets Monitor dispatch of medicines Gather market intelligent report New agency allotments Hold agency and Doctors meetings Appraisal of agency performance Liaison between ISM Department Attend to matters relating to advertisement, sales promotions, Trade Fairs etcThe duties and responsibilities of Manager (Sales)(D) includes: To attend matters relating to Sales to Government Departments, Grama Panchayats, Guruvayur Devaswom and similar institutions. Act as Nodal Officer, related with Government supply, overall management of distribution to Government institutions. Overall control of sales staff etc.Manager (Sales) Attending to matters relating to Sales to Agents within the State of Kerala. This Includes, planning distribution of medicines to Agencies, periodical inspection of agencies. Monitoring the sales through outlets directly run by Oushadhi. Attending the files regarding advertisement, sales promotion and other publicity activities, etcPRICING.The main objective of oushadhi is to produce high quality products and to sell them atreasonable price. The pricing method adopted by the firm includes:
27 Cost plus pricing Competitors pricing.Cost plus pricing:Pricing method whereby a standard markup is added to the estimated cost of the product. Thecost-plus price is computed by dividing the fixed costs of a product by the estimated numberof units to be sold and then adding the variable cost per unit, or by adding the total variablecosts and fixed costs and then dividing by the total number of units to be produced. This willdetermine the true unit cost. Once the true unit cost has been determined, that cost is dividedby 1 minus the desired return on sales (a percentage) to determine the cost-plus . theadvantages of cost plus pricing are: Easy to calculate Minimal informational requirements. Easy to administrate. Tends to stabilize markets- insulated from demand variations and competitive factors. Insures seller against unpredictable or unexpected later cost. Ethical advantages.PRODUCT POLICY To produce medicines of high quality Continuous innovation of product To sell the products through suitable distribution structure. Pack and sale products in convenient pack and to use and store.ADVERTISING POLICIES AND PROCEDURESOushadi has created a high brand image that they are not even able to meet the customerdemand. They stick to the policy that ‘A satisfied customer is the best advertisement’.
28However to educate customers and make them aware of new product, Oushadhi advertisetheir products through various Medias which include: Newspaper Television channels FM Radio Internet Tradefair Exhibition Customer meet Medical camp by agents. Film adAdvertisement for the company is done through various agencies. For this a paper is calledfor and agencies are invited. The company will interview the representatives of the agencies.After interview the company will evaluate which agency can effectively sell them. A totalbudget of one lakh is allocated for advertisement. The various cost incurred are for Payment to agencies Payment to medias To display Pop materials for purchaser Shooting ad film etcDISTRIBUTION STRUCTURE Distribution structure involves the channel through which the products are reaching in thehands of consumers. As Oushadhi is a Government organization, two by third of the productsproduced are sold to the Government. The rest of the sales is done through agencies. Oushadi
29sale its products through six hundred and ten agencies across Kerala and special outlets in theMetros all over India. These agencies helps the organization For the forward flow of products from the company to the consumers. Provide for the successive storage and movement of the product. Helps for making orders and payments.SALES PROMOTION ACTIVITIESSales promotion activities are conducted to stimulate greater purchase of particular productsby the consumer. Oushadi is as patent producer of Ayurvedic medicine and has created brandimage since the beginning. The company is having high demand for its products and is notable to meet the existing demand. Hence they do not take too much effort to promote theirproducts. However, to meet the competition and at the time of introduction of new products,they conduct promotional activity which include Conducting exhibitions and Trade fair Providing free samples Conducting free medical camp Consumer contest etc. Meetings, seminars & camps.MARKETING RESEARCHResearch activities are conducted for the introduction of new products. Oushadhi conductresearch activities to develop medicines that can be used for new deseases. The stepsinvolved while conducting a research include Define the problem Develop the research plan
30 Collect the information Analyze the information Present the findings Making the decisionLarge scale research activities are conducted by the R & D Oushadhi. If any epidemicshappen to spread all over state, oushadhi through its research activities will come up withmedicines which can cure such diseases.HUMAN RESOURCE DEPARTMENT. Human Resources and Administration department is one, which facilitates smooth working of the organization by looking into the human resource side and also the overall administration of organization. Organization hierarchy: HR manager Ass.HR manager clerkHR MISSION: To create HR policies and processes which are employee friendly To build a culture which is warm forthcoming and professional with a sense of ownership & pride. To encourage innovative thinking. To encourage transparency & teamwork.
31 To develop leaders at all levels with general management skills. To create a learning organization. To develop competencies & skills through training and development. To constantly raise levels of employee productivity. To work towards attaining & sustaining the best employer statusMAJOR FUNCTIONS: a) Recruitment b) Selection c) Training d) Industrial Relations e) Welfare f) Security and Safety g) Other Administrative activities h) Performance management i) Enforcement of work culture.The total human resource of the company: Category Permanent Others Total Executives 11 Nil 11 Doctors 7 5 12 Middle level executives 10 11 21 Clerks & Other office staff 18 16 34 Drivers 9 4 13 Maintenance staff 6 13 19 Production supervisors 15 5 20 Security 5 12 17 Field Marketing Officer Nil 5 5 Hospital Workers Nil 8 8 Workers 34 373 407 Total 115 452 567RECRUITMENT & SELECTION.Employees in the organization are recruited after reviewing the vacancy. Employees areselected by the Public Service Commission. Candidates who are eligible in the test are called
32for interview and based on their performance they are selected. Some times vacancies mayarise in the organization and may need immediate placement, in such situation employees areselected on temporary basics. Such employee’s recruitment is done through advertising thevacancy. Recruitment and selection include two phases. The first phase includes vacancyreview, after finding out the vacant position, criteria for selection is formulated. Then suchvacancies are advertised in Medias. After this a selection panel is organized. The secondphase includes short listing the applicant who matches the requirement of the organization.Then these applicants are interviewed by the panel members. After the completion of theinterview the candidates are evaluated. Based on their performance they are selected. Recruitment and selection Phase I Phase II Vacancy review Short listing applicant Formulation of selection Interview criteria Advertising vacancy Evaluation Selecting panel members Selection decisionDISCIPLINE.
33Discipline is used to refer the act of imposing penalties for wrong behavior. If employees failto observe the rules, they are meted out punishment. Any employee violating the discipline inthe organization will be given punishment. Punishments are based on the depth of indisciplinary actions committed by the employee.If any employee commits a minor mistake he has to undergo small punishments whichinclude: Suspension, Charging penalties, Cutting down the benefits which are expected to receive in future. Demotion.If the in disciplinary action of the employee can not be tolerated, they are given severepunishments which include: Dismissal Restricting scope for promotion in carrier Cutting down salary of the employee.All these actions are taken by the M.D. If any employee notices any actions from their co-workers side which are against the discipline of the company, they can report to the M.Dregarding such action. They need to report it to their superior in a written form. Indisciplinary actions include not doing the assigned job not respecting supervisors sleeping atworking hours , bribery, not warring uniforms while at work , put in false signatures, leavewithout prior permissions , harassing others, using drugs in the organization etc.Disciplinary rules of the organization include: Employees should present in the organization at the correct time. To ensure they are present at the correct time, punching system is followed. If any employee comes late for one hour he cannot join the work without the permission of his supervisor.
34 If the employee continues to come late for more than three days his one day leave for that month will be cancelled. If employees absent themselves during the work hours after punching his attitude will be considered as in disciplinary action. Employees are asked to carry their identity cards in order to enter to the organization. Any employee arrested or got imprisoned for any criminal offense for more than forty eight hours; he will be suspended for the time for which he was in the custody. If he proves to be innocent, he can rejoin salary will be provided.GRIEVANCE HANDLING Every employee has certain expectations which he thinks must be fulfill by theorganization he is working for. When the organization fail to do this he develops a feeling ofdiscontent. When the employee feels that something is unfair in the organization he is said tohave a grievance. If any employee feels such, he needs to report it to the immediatesupervisor. If he is not taking any action within one month or his actions are unsatisfactory,the employee can report it to the next higher authority.The grievance if any should be passed through the following channel Manager Supervisor Foreman ke W or rs
35TRAINING AND DEVELOPMENT. Training is the act of the increasing the knowledge and skills of an employee forperforming particular job. Training is provided for both managers and workers, as bothinclude fresh and experienced hands. In Oushadhi training is provided under the control ofHR department to cater the needs of employees. Both on the job and off- the job training areprovided to the employees. Employees are asked to participate in the training programconducted by the outside trainers like Kerala Institute of Local Administration (KILA) Information Management Group (IMG) PF TMA National productivity council Institute of Charted Accountant of India. Etc.The general topics of training include building positive attitude; performance improvementetc. To ensures versatility of workers job rotation and apprentice training are given to theemployees. The impact of training will be observed from the performance of the employees.PERFORMANCE APPRAISAL OF EMPLOYEES.Performance appraisal is done to evaluate how well an employee is performing his job in theorganization. Based on this compensation decisions, decision on promotion of employees,need for training and development of employees are decided. Performance is appraised onyearly basics and it will be graded as outstanding, good, satisfactory & unsatisfactory. Theappraisal is done by top management. The appraisal form is given to workers and are asked tofill in the details which include name, job specification, target achieved by the employees,their difficulty in achieving the target if any etc..FINANCIAL AND NON FINANCIAL INCENTIVES
36Oushadhi pharmaceuticals provide both financial and non financial benefits to the employeesin order to retain them and to provide a satisfied work environment.Financial incentives include: Bonus, Extra wages for meritorious performance, Leave wages etc. Honorariums of Rs1000 are awarded to the employees who have extra ordinary caliber to perform job efficiently and effectively.The various non financial incentives include: Providing training facilities to the employees, Giving suitable promotions to employees. Employees are allowed to participate in managerial decision making,. Family get together and holiday trips are conducted by the organizationWELFARE FACILITIES.Welfare facilities are provided for better standard of living of the employees.The intramural facilities include: rest shelters, uniform and protective clothing subsidized food medical reimbursement, Canteen etc.
37The extramural facilities include: transportation facilities maternity benefits Social insurance etc.COMPENSATION PLAN.Salaries of the employees are paid as per payment of Wages Act 1936. Salaries to theemployees are paid at the end of every month. Special wages are paid to the employees forspecial work. Personal salary is paid on account demotion given to the employees.Employees who have extra ordinary caliber are paid with an honorarium of Rs 1000.PRODUCTION DEPARTMENT.In every department production department plays a very important role. Likewise in oushadhipharmaceuticals also. The function of this department is to plan and control the production ofmedicines. Production manager is the head of this department. Oushadhi pharmaceuticalsproduce around 450 varieties of medicines. The functioning of this department has qualitybecause of the supervision of experienced doctors to supervise production. The production ofmedicines is as per GMP norms. Strict quality control procedures are practiced to ensurequality of raw materials and finished products. Modern dosage like ointment, tablets,granules, and syrup are introduced.The objective of this department is: Achieving high production efficiency Low costs Mass distribution Production manager.
38 Deputy production Deputy production manager. manager Assistant production managers. Trainee doctors.THE POWERS AND DUTIES OF PRODUCTION MANAGER Planning and implementation of production in the Factory on the basis of prefixed targets. Ensure that necessary documents, registers and records in relation to production are properly maintained. Ensure co-ordination between sections of production. Maintenance of general discipline in the factory. Deployment of workers suitably. Observation of product/process related statutory requirements etc.PRODUCTION PROCESSProduction process starts with the purchase of raw material. Raw materials purchased arestored in the raw material stores. These materials needed for production are collected from all
39over India. They are purchased after testing the quality of material. The material whichmatches the pre- determined specifications is purchased. Each doctors are provided with araw material come issue note. They will specify their requirements in the note. These rawmaterials purchased are then transferred to pre processing unit. There these materials aretransferred into course powders for preparing medicines. These are then transferred intoprocessing units where the actual production takes place. These produced products are thentransferred to the quality control section and after checking the quality it is transferred intoprepared medicine stores. .RECEIVING & PROCESSING ORDERS.As Oushadhi is a Government undertaking, every year Government release fund in thebudget. Production is based on the basis of previous years demand. The ¾ th of the productsare sold to Government. There is a raw material come issue note provided to each departmentand doctors. They will specify their requirements and based on this production is done.Usually order is received as per the demand. Batch processing is done. The total order isdivided into batches and. After production of each batch the quality is tested. Based on theorder received production is carried out accordingly.Eg of production process of kashayam: Raw materials Disintegratio n Inprosess Quality Evaporatin quality check g pan. check. Drug boiler.
40 Quality check Adding preservative certification Packing.INVENTORY MANAGEMENT.The Inventory Management system and the Inventory Control Process provides informationto efficiently manage the flow of materials, effectively utilize people and equipment,coordinate internal activities, and communicate with customers. Inventory Management andthe activities of Inventory Control do not make decisions or manage operations; they providethe information to Managers who make more accurate and timely decisions to manage theiroperations. The basic building blocks for the Inventory Management system and InventoryControl activities are:1. Sales Forecasting or Demand Management2. Sales and Operations Planning3. Production Planning4. Material Requirements Planning5. Inventory ReductionPRODUCTION PLANNINGProduction planning is the process of producing a specification or chart of the manufacturingoperations to be performed by different departments over a particular time period. Productionscheduling takes account of factors such as the availability of plant and materials, customerdelivery requirements, and maintenance schedules. Production plan is prepared as per the
41demand received. A batch manufacturing record is maintained by the department. Thematerials required for each bottle of medicines, and also the quantity needed is specified.Using this total quantity to be produced is calculated and production is done on the basics ofthis information.Steps in production planning:1. Production planning• Verify the annual production demand from marketing section• Convert the annual production demand to batch wise report monthly, weekly, daily• Reply to marketing section• If the actual production plan is satisfactory to the marketing department, it is send topurchase• Production target & achievement details of each section.2. Allocation of man power for each section• Absenteeism of man power in each section and allocation of reserved man power toconcerned section3. Product creation• Check infrastructure availability• Develop raw material indent for a product• Fill in the batch manufacturing record• Record quality checking details• Details of Daily packing (quantity packed, pending, reasons for delay in packing)• Complete the BMR return to QC lab4. Medicine transfers• Prepare medicine transfer statementMATERIAL REQUIREMENT PLANNINGPurchase department is responsible for bargaining, procuring, managing and storing the rawmaterial needed for the production. This department plays a vital role in carrying out theprocess very smoothly. This department includes two sections. One is purchase and the otheris store.
42Steps in purchases of raw materials. Need recoginition. Inviting tenders. Determination of price Preparation of purchase order Acceptance of purchase order Making Payment Follow-up Follow-upNeed recognitionFirst of all the needed items often brought to the attention to the purchase department throughthe material cum issue note. The materials needed by all the departments will be specified inthe note.Inviting tenders.Purchases of the company are made through inviting tenders. The suppliers who couldprovide high quality materials at lowest rate and prompt delivery would be selected. Usuallya credit period of 60 days is followed by the company.Determination of priceThe next function of this department is to secure the price for the items to be purchased. Thesupplier providing the lowest price is selected.Preparation of purchase order
43In this phase the purchase department prepares the purchase orders and sends it to thesuppliers.Acceptance of purchase orderAfter sending the order the vendor provides the acceptance receipt and is accepted by thecompany and properly maintained.Follow upFollow up is also done to ensure the timely delivery of material.Making paymentsFinal function is to check the invoice and approving it for making payment to the supplier. Itis only provided to those who provide the invoice properly and also maintains the register ofvarious invoices. Through the purchase department the company purchases all the materialswhich have affordable price. Whenever the material reaches the company it checks thequality of raw materials.STORES DEPARTMENTStore section is also comes under the purchase department. The major function of thisdepartment is to store both raw material and finished products. Also it will issue the rawmaterials to the production department.OBJECTIVES To give information regarding the availability of spares, chemicals etc. To provide all materials for different departments Keeping of materials with proper indication
44 Proper information relating to stock levels of different materials.FUNCTIONS OF STORE DEPARTMENTFirst of all the section receives raw materials through purchase department and stores here.According to the transfer note, which is send by the purchase section to the store sectionreceives the raw material. Another function is to check the quality of the raw materialsreceived. Only which are passed after checking the quality are transferred to the productiondepartment for producing various mats. Some of the finished products are also stored in thissection.LIST OF MAJOR RAW MATERIALS. Other than medicinal plants. Medicinal plants based. Gingelly oil. Chukku Cow ghee Cheenathipally Coconut oil. Amukkuram Jagerry Kurumthottiveru Cow milk. Kurumulaku Honey. Klakkaya Castor oil. Kachoori Sugar. Raktha chandanam Camphor. Kadukkathodu Sugar candy. Athividayam..WASTAGE MANAGEMENT.Oushadhi aims to produce maximum output with minimum waste. To reduce wastage ofresources production is done with great care under the strict supervision of doctors,supervisors and foremens. They check for the quality of the production, and ensure reductionin wastage of materials. Still there will be waste products left after the production ofmedicines. Oushadhi Pharmaceuticals Corporation, Kuttanalloor, produces about one tone ofwastes daily in the process of manufacturing more than 400 formulations like asavarishtam,kalkam, himam, lehyam and the like. The wastes thus produced are managed effectively bythe corporation. The waste obtained from the production of choornams recycled using ahydraulic presser, which when pressed will extract oil present in the wastes which can be
45used for further production. The other waste products are collected in a container and are soldto outside agencies on contract basics. which are used for manufacturing fertilizers.QUALITY CONTROL & R&D WING.Oushadhi has well equipped quality control laboratory that monitors every step of production,right from procurement of raw materials to packing and storing. To ensure quality rawmaterials, Oushadhi has set up a herbarium where rare medicinal plants are nurtured. It hasalso set up an R & D wing for increasing the efficiency of medicines and manufacturingmarket friendly products, all under direct supervision of eminent physicians.This department aims to be a committed towards giving total satisfaction to their customersthrough the manufacture and making of Ayurvedic drugs and formulations at affordable pricewhile complying with all satisfactory requirement. They strive to be effective continuallyimproving their process. This is achieved by taking appropriate involvement of all themembers in the organization. The quality control and R&D wing are functioning effectivelyto ensure high quality products.STAGES OF QUALITY CONTROL ACTIVITY1. Receipt of request for quality checking along with sample2. Entries of items into common register date wise3. Testing methods for each Organoleptic Physico chemical characteristics4. Posting the values in corresponding records.5. Verification with standards.6. Furnishing quality certificate.7. Certificate issue to the concerned section.8. Packed sample collection and sample checkingRESEARCH AND DEVELOPMENT ACTIVITIES:The main function of the department include Product innovation Process innovation Stage wise quality examination
46 Research on substitute raw material drug & product. Training programs for Ayurveda MD, B.pharm, BAMS, and biotechnology students Product Development and related works like experimental and clinical trials. Innovation practices in processes and products to present ancient pharmaceutical forms in user friendly mode. Preparation and implementation of various projects for standardization, Shelf life studies, Prototype development, and Process trouble shoot etc. Preparation and implementation of various projects from other disciplines like Biotechnology, Biochemistry, Microbiology, Applied Chemistry, Modern Pharmacy etc. based on the formulations, processes and clinical practices laid down in Ayurveda. Preparation of database for raw materials, process, and formulations. RECORD KEEPING.The company maintains a prompt record of all the process done inside the organization. Thishelps to know about the consumed materials and products produced daily and by maintainingrecord wastage can be reduced to a great extend.1. BMR Records2. In-process Register3. Milk Register4. Lab equipment calibration records5. Batch wise medicine reports6. Section wise quality control parameters with QC number against work order7. Finished goods daily register8. Raw material daily register9. Raw material analysis registers10. Finished goods Analysis Register
48 FINDINGS SUGGESTIONS, CONCLUSION AND BIBLIOGRAPHY SWOT ANALYSIS OF OUSHADHI.STRENGTH Established brand image. Continuous government support. Huge market demand. Dedicated work force.WEAKNESS Lack of good marketing technique. No sales promotion activities. Too much government control.OPPORTUNITIES More patent product introduction through R&D
49 Lot of potential market. Tradition and goodwill. Increasing popularity of ayurveda.THREATS Tough competition Lack of credit policy Scarcity of herbs &plants Maintaining quality with modernization. FINDINGS Oushadhi is the largest producer of Ayurveda medicines in public sector in India. Sole supplier of medicines to government Ayurveda hospitals and dispensaries in Kerala. Oushadhi is a real example of efficient management. All its managerial functions are carried out in a systematic way. Oushadhi is having an efficient marketing system which creates and retain the goodwill of the company. Oushadhi provide high quality medicines through its well equipped quality control lab.
50 SUGGESTIONS Try to open more agencies through out the country and abroad. Advertisement and sales promotion in order to face competition. Cultivate as much medicinal herbs as possible. Conduct awareness programs to promote the cultivation of medicinal herbs in the surrounding areas.
51 CONCLUSIONThe organizational study at OUSHADHI helped me to understand the various functions of anorganization. It helped me to understand the functioning of different departments and howthey are coordinated and managed to achieve a common goal. It helped me to understand howthe management principles are set in to practice. The study has helped me to cooperate withchallenges like difficulty in getting data, communication, base information, processing of rawdata and time. The new product development, entrance into the field of social responsibility,
52exploring new markets and providing more customer satisfaction etc are the future prospectusof the company.BIBLIOGRAPHY.1. Company journals2. V S P Rao. Human resource management.3. Philip kotler. Marketing management.4. P M Srivastha. Financial management.
535. p.saravanavel Production management6. www.oushadhi.org.