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Os 2013

  2. 2. 1.1 INTRODUCTION The term ‘organization’ has been defined by many experts of management in different ways, and while defining the term they have put emphasis on its different aspects. This has created a lot of confusion. Generally, organization refers to a group or an association or an institution of individuals working together for achieving predetermined common goals. So an organization is inevitable in those situations where two or more individuals work together to achieve a common objective. It may also defined as a planned unit formed by individuals for pursuing specific goals. The organization may further be viewed as a collective entity of individuals putting in joint effort to seek their common interests. Organizational study is "the examination of how individuals construct organizational structures, processes, and practices and how these, in turn, shape social relations and create institutions that ultimately influence people", organizational studies comprise different areas that deal with the different aspects of the organizations, many of the approaches are functionalist but critical research also provide alternative frame for understanding in the field. Organization is the backbone of management. Without efficient organization, no management can perform its functions smoothly. Sound Organization contributes greatly to the continuity and success of the enterprise. The organizational study undergone during the month of May was for partial fulfillment of the award of degree of Master of Business Administration of Mahatma Gandhi University. It helps to know more about the functions, structure, policies and different procedures undertaken in an organization. The study abridges the gap between theoretical knowledge and practical working condition. The organizational study was conducted at KERALA STATE DRUGS AND PHARMACEUTICALS Ltd which is the only pharmaceutical undertaking of government of Kerala. The study helped me to know the various functions in the organization. Every organization can be conceived as consisting of various subsystem or parts. Effective functioning of each of these parts is essential for effective functioning of the organization. In addition, the coordinated functioning of these subsystems also contributes to organizational effectiveness. For making organizational diagnosis the, strength weakness and potential Page | 2
  3. 3. of each of the subsystem need to be examined, hi addition the various processes that contributes to the effective functioning of the organization as a whole to be examined. 1.2 SCOPE OF THE STUDY The organizational study helps us to familiarize with the practical side of organizational functions. Thus an analysis is made through studies in which the theoretical aspect is compared with the actual situation. The scopes of the study are:- • This study aims to acquire an overall knowledge about all the Departments and procedures being carried out in the organization. • To have an exposure in working environment of an organization. • This study help to understand the decision making process in an organization and also to know the organization system. 1.3 OBJECTIVES OF THE STUDY The organizational study is to familiarize with a business organization and the operation of its departments and also interact with the managers at various levels of the organization hierarchy to acquire awareness about the practical side of the theories. Also the scope of the study covers examination of the structure of the organization, seeking information about the products produced and study on the functions of various departments of the firm.  To carry out a departmental study or analysis at Kerala Drugs and Pharmaceuticals LTD.  To familiarize with the organizational function.  To understand and get familiar with all the activities in the company  To understand process flow and management of departments in the company  To get acquainted with the policies, procedure, strategies, and programs adopted by the company.  To know the inter related department functions of an organization  To familiarize with the organizational structure and various departments. Page | 3
  4. 4.  To find out the Strength, Weakness, Opportunities& Threats of KSDP.  To knows the duties and responsibilities of the personnel. CHAPTER 2 INDUSTRY PROFILE Page | 4
  5. 5. INDUSTRY PROFILE 2.1 Background The Pharmaceutical Industry today is in the front rank of India’s science-based industries with wide ranging capabilities in the complex field of drug manufacture and technology. It ranks very high in the third world, in terms of technology, quality and range of medicines manufactured. From simple headache pills to sophisticated antibiotics and complex cardiac compounds, almost every type of medicine is now made indigenously. The Indian pharmaceutical sector has come a long way, being almost non-existent before 1970 to a prominent provider of healthcare products, meeting almost 95 per cent of the country's pharmaceuticals needs. The Industry today is in the front rank of India’s science-based industries with wide ranging capabilities in the complex field of drug manufacture and technology. It ranks very high in the third world, in terms of technology, quality and range of medicines manufactured. From simple headache pills to sophisticated antibiotics and complex cardiac compounds, almost every type of medicine is now made indigenously. The Indian Pharmaceutical sector is highly fragmented with more than 20,000 registered units with severe price competition and government price control. It has expanded drastically in the last two decades. There are about 250 large units that control 70 per cent of the market with market leader holding nearly 7 per cent of the market share and about 8000 Small Scale Units together which form the core of the pharmaceutical industry in India (including 5 Central Public Sector Units). These units produce the complete range of pharmaceutical formulations, i.e., medicines ready for consumption by patients and about 350 bulk drugs, i.e., chemicals having therapeutic value and used for production of pharmaceutical formulations. Page | 5
  6. 6. 2.2 Growth Scenario India's pharmaceutical industry is now the third largest in the world in terms of volume. Its rank is 14th in terms of value. Between September 2008 and September 2009, the total turnover of India's pharmaceuticals industry was US$ 21.04 billion. The domestic market was worth US$ 12.26 billion. This was reported by the Department of Pharmaceuticals, Ministry of Chemicals and Fertilizers. As per a report by IMS Health India, the Indian pharmaceutical market reached US$ 10.04 billion in size in July 2010. A highly organized sector, the Indian Pharma Industry is estimated to be worth $ 4.5 billion, growing at about 8 to 9 percent annually 2.3 Domestic Demand The industry has enormous growth potential. Factors listed below determine the rising demand for pharmaceuticals. • The growing population of over of a billion • Increasing income • Demand for quality healthcare service • Changing lifestyle has led to change in disease patterns, and increased demand for new medicines to combat lifestyle related diseases More than 85 per cent of the formulations produced in the country are sold in the domestic market. India is largely self-sufficient in case of formulations. Some lifesaving, new generation under- patent formulations continue to be imported, especially by MNCs, which then market them in India. Overall, the size of the domestic formulations market is around Rs160 billion and it is growing at 9 per cent per annum. 2.4 Future Prospects The Indian pharmaceuticals market is expected to reach US$ 55 billion in 2020 from US$ 12.6 billion in 2009. This was stated in a report title "India Pharma 2020: Propelling access and acceptance, realizing true potential" by McKinsey & Company. In the same report, it was also mentioned that in an aggressive growth scenario, the pharmaceuticals market has the further potential to reach US$ 70 Page | 6
  7. 7. billion by 2020 Due to increase in the population of high income group, there is every likelihood that they will open a potential US$ 8 billion market for multinational companies selling costly drugs by 2015. This was estimated in a report by Ernst & Young. The domestic Pharma market is estimated to touch US$ 20 billion by 2015. The healthcare market in India to reach US$ 31.59 billion by 2020. The sale of all types of pharmaceutical drugs and medicines in the country stands at US$ 9.61 billion, which is expected to reach around US$ 19.22 billion by 2012. Thus India would really become a lucrative destination for clinical trials for global giants. 2.5 Market Share Of Different Pharmaceutical Product Categories Category Market share (%) Value growth (%) Volume growth (%) Anti – infective 17 4 11 Gastrointestinal 11 8 9 Cardiac 10 18 15 Respiratory 10 9 6 Vitamins/minerals 10 5 5 Pain/analgesic 10 8 9 Dermatological 5 8 4 Gynaecology 5 3 -1 Neuro psychiatry 5 10 6 Antidiabetics 4 11 16 Opthologicals 2 18 16 Others 11 - - (Table:2.5) 2.6 Major Players In The Pharmaceuticals Industry Page | 7
  8. 8. 1. Ranbaxy Laboratories Ltd. 2. Dr. Reddy’s Laboratories 3. Nicholas Piramalindia Ltd 4. Cipla Ltd 5. Biocon Ltd 6. Aurobindo Pharma Ltd. 7. Glaxosmithkline Pharmaceuticals Ltd. 8. Cadila Healthcare Ltd. (Zydus) 9. Sun Pharmaceuticals Industries Ltd. 10.Wockhardt Ltd. 11.Dihman pharmaceuticals Ltd 12.Elder pharmaceuticals Ltd 13.JB pharmaceuticals Ltd 14.Merck pharmaceuticals Ltd 15. Matrix laboratories Ltd 16.Divis Laboratories Ltd 17.Abbott India Ltd 18. Blue Cross Laboratories Ltd 19.Intas pharmaceuticals Ltd 20.Lupin Ltd Page | 8
  9. 9. 2.7 Strengths Of Indian Pharmaceutical Industries  Competent workforce India has a pool of personnel with high managerial and technical competence as skilled workforce. It has the largest English speaking population in the world. Professional services are easily available.  Cost-effective Chemical Synthesis Its track record of development, particularly in the area of improved cost beneficial chemical synthesis for various drug molecules is excellent. It provides a wide variety of bulk drugs and exports sophisticated bulk drugs.  Information & Technology It has a good network of world-class educational institutions and established strengths in Information Technology.  Globalization The country is committed to a free market economy and globalization. It has a 70 million middle class market, which is continuously growing  Consolidation The international pharmaceutical industry is finding great opportunities in India as the process of consolidation has started taking place in India.  Low priced products The industry has thrived so far on reverse engineering skills exploiting the lack of process patent in the country. This has resulted in the Indian pharmaceutical players offering their products at some of the lowest prices in the world. Page | 9
  10. 10.  Quality assurance The quality of the products is reflected in the fact that India has the highest number of manufacturing plants approved by US FDA (61 plants), which is next only to that in the US.  Dominance in the market Multinational companies have traditionally dominated the industry, which is another trend seeing a reversal. Currently, it is the Indian companies which are dominating the marketplace with the local players dominating a number of key therapeutic segments.  Self-reliance Displayed by the production of 70 per cent of bulk drugs and almost the entire requirement of formulations within the country.  Labor force With one of the largest and most genetically diverse populations in any single country, India can recruit for clinical trials more quickly and perform them more cheaply than countries in the West.  Other Strengths Low cost of production, Low R&D costs, Innovative Scientific manpower and Increasing balance of trade in Pharma sector are also significant strengths of the Indian pharmaceutical industry. 2.8 Challenges Of Indian Pharmaceutical Industry  Underdeveloped new molecule discovery program The main weakness of the industry is an underdeveloped new molecule discovery program. Even after the increased investment, market leaders such as Ranbaxy and Dr.Reddy’s Laboratories spent only 5-10 per cent of their revenues on R&D, lagging behind Western pharmaceuticals like Pfizer, whose research budget last year was greater than the combined revenues of the entire Indian pharmaceutical industry. This disparity is too great to be Page | 10
  11. 11. explained by cost diffentials, and it comes when advances in genomics have made research equipment more expensive than ever.  Hue & cry against exploitation In clinical testing persons from developing countries will be used to generate data about possible effects of a drug. A feeling of unrest among them or some section of society might develop that we are being used as guinea pigs. It might lead to demonstrations or legislations which will hamper the growth of industry.  IP leakage IP leakage is one of the major concerns by companies outsourcing research work to India. So any major incident of IP leakage by Indian company can taint the image of whole industry.  Restricted items There are a lot of items that are restricted under the EXIM policy from free trading. These restrictions are a weakness for the industry and hence pose to be a threat for its development.  Safety concerns With recent high profile product withdrawals, there are also concerns that regulatory agencies will tighten up safety and efficacy testing requirements. A particular focus will be on the application of pharmacogenomics techniques to improve safety profile, but the advent of such techniques in the long run will improve industry productivity as more pharmacogenomics data is collated. Page | 11
  12. 12. CHAPTER 3 COMPANY PROFILE Page | 12
  13. 13. COMPANY PROFILE 3.1 Introduction About The Company Kerala State Drugs & Pharmaceuticals Ltd., a Public Sector Undertaking, since its inception in 1974 has been manufacturing and supplying essential and lifesaving medicines to cater the need of the common patients resorting to Hospitals in the State of Kerala. It is situated in Kalavoor, Alappuzha district. The KSDP Ltd. was incorporated as a company on1971 under the companies act,1956 with the main object of meeting the entire demands of drugs and formulation of the State Health Service Department. KSDP Ltd. is a subsidiary of M/S Kerala State Industrial Enterprises Ltd ( KSIE Ltd),Trivandrum. The factory was inaugurated in 12th September, 1974 and started its commercial production, manufacturing and supplying of essential and lifesaving drugs to health service department of the government of Kerala from 1978 onwards. It was started as a “kitchen” to supplying medicines to various government institutions coming under Government of Kerala. The complete shares of the company are taken by the Government. The liability of the members is limited. The slogan of the company is “quality that cures” and the company produces medicines that ‘cures’ rather than treats. The Company has reached glorious heights in its way to thrive in this Hi-Tech era. The Product Development wing of the Company has made all efforts to bring out scores of new products in addition to the existing multiplicity of drug formulations to the tune of hundred odd products. The development work of new generation drugs are in progress. Without any compromise in Quality, KSDP LTD. is shielding itself from the globalization threats and venturing in to commercial trade operations. Now the Company is a major supplier of Quality drugs to Kerala State Medical Service Corporation (KMSCL), Thiruvananthapuram. When multinational companies and other companies in the private sector were supplying medicines at exorbitant prices and reaping high profits, the entity of Government Company in the Page | 13
  14. 14. pharmaceuticals sector became absolutely necessary and hence the honorable minister for industries Sri T.V Thomas decided to set up the plant in an industrially backward district alleppey. The watch word of KSDP is “May all be free from diseases”. KSDP has two units 1. Formulation division 2. Vitamin division Now formulation division is only working 1. Formulation division The formulation division has different department such as Marketing, Production Purchase, Store, Production Planning, Personnel, Finance, Maintenance and research & development. KSDP started with this formulation division and as far as KSDP is concerned the formulation is very important and now this division is only working. Mainly the company is producing different types of tablets, capsules and powders. 2. Vitamin –a division KSDP started producing vitamin A in the year of 1983 and seized in the year 2004.The company stopped the production of Vitamin A due to heavy loss. The loss of the plant was due to high cost of production and unavailability of raw materials like lemon grass oil. 3.2 Slogan and logo of KSDP “Quality that cures” Page | 14
  15. 15. (Fig:3.2) 3.3 Vision and mission Vision To manufacturing and market “quality drugs” at economical rates to the common man and to extend social justice to suit the needs of the common man, moreover to formulate new products through research and development Mission  To undertake manufacture and trading of drugs, pharmaceuticals, Radio –Pharmaceuticals, Nutriments, Cosmetics and Hospitals equipment  To provide financial, technical, marketing development or any other assistance and guidance to any establishment, undertaking or any description what so ever which is likely to facilitate or accelerate the development of industries relating to Drugs,Pharmaceuticals,Radio- Pharmaceuticals,Nutriments,Cosmetics and Hospital equipment.  To promote, establish and operate sales offices such as Emporia, showrooms. Publicity offices, Stalls and Centers with the object of improving the marketability of Drugs, Pharmaceuticals Radio –Pharmaceuticals, Nutrients, Cosmetics and Hospitals equipment. 3.4 Specialties  The specialties of the company include antibiotics, vitamin B compound, anti-asthmatic medicines and disinfectant. Along with the above, the company in total, at present manufactures 53 drug formulations belonging to various groups like anti-diarrheal, tranquilizers etc. Page | 15
  16. 16.  Being a pharmaceutical industry, the KSDP has a well maintained animal house to perform toxicity and pyrogen tests on chosen healthy animals. KSDP is very particular about the quality of the raw materials even if the price is high. As per drugs and cosmetic act and rules, the company has to maintain raw materials and finished products. The company is very particular in maintaining each and every aspect.  Costly instruments are used for separate tests for each and every batch. The instruments like ultra violet spectrometer, infrared spectrometer, G C spectrometer and HPCC spectrometer. These instruments cost nearly Rs 10 lakhs. The company has a highly dedicated workforce and professional supervision.  The Marketing is mainly under the heading of formulation division. 95 % of the production of formulation division is given to the department of health, government of Kerala. Balance portion i.e. nearly 5 % is sold to other state and central government hospitals. 3.5 Products of KSDP (Fig:3.5) Capsule 1. Amoxicillin Capsules I.P 2. Ampicillin Capsules I.P 3. Cloxacillin Capsules I.P Page | 16
  17. 17. Tablets 1. Paracetamol Tablets I.P. 2. Cotrimoxazole Tablets I.P 3. Salbutamol Tablets I.P. 4. Citrizine Tablets I.P. 5. Metronidazole Tablets I.P 6. Glibenclamide Tablets I.P 7. Ciprofloxacin Tablets I..P. . 8. Erythromycine Stearate Tablets I.P 9. Metochlopromide Tablets I.P. 10. Folic Acid Tablets I.P 11. Acetylsalycylic Acid Tablets I.P 12. Chlorpheneramine Maleate Tablet I.P. 13. Diethyl Carbamazine Citrate Tablets I.P 14. Amitriptyllin Tablets I.P 15. Alprozolam Tablets I.P 16. Frusemide Tablets I.P. 17. Haloperidol Tablets I.P 18. Vitamin - B Compound Tablets I.P. Strong 19. Aluminium Hydroxide Tablets I.P 20. Norfloxacin Tablets I.P. 21. Phenobarbitone Tablets I.P 22. Diazepam Tablets I.P. Liquids 1. Citrimide and Chlorhexidine Solution. (Strong) 1 Litre Powders 1. ORS Packets WHO Formula Purified Talc Page | 17
  19. 19. (Fig:3.6) 3.7Responsibility and authority of executives 1.Managing director Responsibility  Overall control of the Company  Resource planning  Growth and development of the Company  Ultimate responsibility for product quality Management system  Chairing of the Company policy and achieving targets/objectives Authority  Total authority for all type of transaction of the Company subject to approval by the Board of Directors 1. Marketing manager Responsibility  Overall responsibility of marketing activities.  Contact review Authority  Contract finalization  Authorized to send subordinates staff on travel for official purpose.  To initiate disciplinary action against subordinates. Page | 19 STAFF DY MANAG ER ASSISTANT MANAGER TECHNICAL STAFF DY MANAGER (PIRO) SECURITY OFFICER DY MANAGE R personneL STAFF SECURI TY STAFF STAFF JUNIOR MANAGER STAFF SCIENTIST S ASSISTANT MANAGER
  20. 20. 2. Personnel & Administration Manager Responsibility  Wage administration and statutory compliance under Labour Law.  Identifying Training needs and Organizing training programs  General administration and Employee welfare. Adopt measures to seek Employee involvement in Company‘s development activities Authority  Approve payments to Employees ,Security ,Canteen, Transport etc. as per norms  Authorized to send subordinate staff on tour for official purpose  To initiate disciplinary action against erring subordinates 3. Finance manager Responsibility  Overall charge of the department  Preparation of Budget annually and enforcing financial discipline to work within the Budget  Costing of activities and suggesting cost control measures Authority  To represent KSDP in financial transaction with financial institution and other agencies as authorized by Managing Director  To recommend necessary Training needs to Subordinates staff  To initiate necessary discipline action against erring subordinate staff 4. Senior Manager Technical Responsibility  Over all charge of Production, Manpower, and co-ordination with other departments  Cost control and productivity improvement  Monitoring and implementing adequate safety measures for men and machinery Authority Page | 20
  21. 21.  To recommend necessary training needs to subordinates staff  To initiate necessary disciplinary action against erring subordinates. 5. Quality control manager Responsibility  Inspection of incoming raw materials & process  Calibration of Testing and Laboratory Instruments Authority  Final authority to accept/reject incoming and process materials  Authorized to stop /restart production /process in the case of non-quality production  To issues materials Test Certificate for finished products  To initial disciplinary action against subordinates. 6. Purchase Manager Responsibility • Supplier evaluation and all purchase activities • Inventory Management of incoming materials, compliance of purchase and inventory procedures Authority • Authorized to send subordinate staff on tour for official purpose • To initiate disciplinary action against subordinates 7. Maintenance Manager ( Electrical, Mechanical, Civil ) Responsibility  Overall charge of technical and administrative function of electrical and mechanical departments  Making plant and machinery available for maximum productivity by bringing down breakdown and scheduling preventive maintenance suitably Page | 21
  22. 22.  Introducing cost reduction where ever possible and implementing value Engineering Page | 22
  23. 23. FUNCTIONAL AREA 3.8.1 PRODUCTION DEPARTMENT Production department is considered to be the most important and largest department in the organization. The authority of this department is within the hands of production manager. The workers are working sincerely and best of their skills. There are permanent workers, contract workers and trainees in this department. The production department is operating under the directions of marketing and sales divisions, quality control departments, stores and inventory control. The total quantity to manufacture and the denomination of packing is obtained by production planning department and fed to the manufacturing wing .The quality department makes constant watch over the blending standards, packing safety and product hygiene. The inventory control department and packing section takes over the finished products in the predetermined areas. The production department consists of different sections such as tablets, capsules, powders and liquid preparation. Page | 23
  24. 24. Of Tablets Steps involved in the production of tablets are 1. Mixing 2. Drying 3. Powdering 4. Lubrication 5. Compression 6. Coating (Fig: 1. MIXING In mixing process, necessary ingredients as per the formula required for the formulation of each tablets are mixed together to obtain a wet mass, using a mixer machine. There will be an active ingredient for each tablet. The ingredients within the formula in addition to the active are called excipients. Excipients are needed to make a good quality tablet at the required tablet press speed. They help the flow, compressibility and the ability of the tablet to eject from the tablet press without falling apart. Excipients also enhance the hardness, disintegration, appearance, color, taste, and the overall performance of the tablet. It takes almost 20 minutes for mixing each batch. The common additives or excipients are  Binders  Disintegrating agents  Preservatives  Colours Page | 24 MIXING DRYING POWDERIN G LUBRICATIO N COMPRESSIO N COATING
  25. 25.  Flavors  Diluents The binders are used to provide stickiness to the powder. Commonly used binders are starch paste, gelatin, acacia paste. Disintegrating agents are added for the dissolution of tablet in the stomach. Starch powder or paste is commonly used as disintegrating agent. Preservatives are for the shelf time. It varies from 3 to 5 years. If necessary colours and flavors are added. For the small dosage of tablets diluents are added to increase the bulkiness. Lactose, glucose and sugar are used as diluents here. 2. DRYING The wet mass obtained after the mixing process should be dried using hot air. There are two types of dryers like  Fluid bed dryer  Tray dryer. In fluid bed dryer the wet mass is collected in a machine as bulk and steam is passed through it. Steam is obtained by heating water using electricity. In the case of tray dryer the wet mass is collected in different trays and is dried by placing these trays in a closed container. Hot air is passed through this container to dry the wet mass. In the drying step the wet mass is dried to a predetermined end point, commonly measured with a test called the “LOD” or loss on drying test. 3. POWDERING The dried mix consists of lumps. This mix of lumps is powdered in order to  To improve powder flow.  To improve compressibility  To reduce fines.  To control the tendency of powders to segregate  To control density  To capture and fuse small quantities of active material The dried mix consisting of lumps is powdered with the help of a powdering mill and its passed through a sieve to get fine particles of uniform size. The resultant form is subjected to sieving to extract fine powdered materials. Milling equipment is used to Improve flow, reduce segregation, Page | 25
  26. 26. enhance drying, and limit wide particle size distribution. There are four standardized tests which are commonly performed on either milled or finished granules:  LOD- water content  Bulk Density, mg/ml  Particle Size Distribution  Angle of Repose, flow gradient. Two of the four tests, Loss on Drying (LOD) and Particle Size Distribution, are commonly performed by operators on the production floor. In some cases, the operator only performs the LOD and the other three tests are performed in the laboratory. The practice varies depending on the situation. MILL APPLICATION: Generally we want to be as gentle with powders as possible. Some powders have high moisture content and they may be subject to compaction within the mill; others are very hard and friable and are subject to producing “fines”. Fines are powders that are very small and “dusty”, which will pass through a 200 mesh screen. Fine dusty particles impede the flow, do not compress well and can become air born. The air born dust can be witnessed on filters, walls, cabinets and machine components. Besides affecting yields, the dust will combine with oil and grease on the tablet press causing the punches to become tight, requiring more frequent cleaning cycles. 4. LUBRICATION The fine granules which obtained after powdering is lubricated using lubricating agents like talc, magnesium stearate, dried starch etc. Lubrication is carried out in a machine called Drum Mixer. It is mainly done to avoid the sticking of the mixture in the machines. 5. COMPRESSION Here the mixture is compressed in a compression machine to form tablets of desired shapes and sizes. The powder is compressed with the help of punches and dyes which can be attached to the compression machine. The size of the punches and dyes varies according to the size of the tablets. The lower and upper punch is pressed to compress the tablets. After compression, the tablets will be Page | 26
  27. 27. released by moving the punches apart. Here double rotary compression machine is used to make 54 tablets [27*2] in one rotation. In this step itself the tablets are turned into finished form with the engravings punched on it. The main steps involved in compression are  Filling the die: first step involved in compression is filling the die with the powdered mixture. To adjust the weight of tablet, volume of filling the power in the die should be adjusted. The tablet should be made available in different weights , say 250 grams, 500 grams etc. Based on this the die should be filled.  Compress the tablet: With the help of upper punch and lower punch the powder is compressed to form the tablet. When it is compressed all air inside the die and between the powder is removed. As binders are added with the mixture the powdered mixture stick to one another and thus tablets are formed in the shape of the dies used.  Eject the tablet: The tablet is pushed from the die. When setting up the tablet press; Adjust Tablet Weight, Adjust Thickness, Balance weight & thickness and machine speed, to get proper Hardness. 6. COATING Once a good tablet is made, we often need to add a coating. The coating can serve many purposes; it makes the tablet stronger and tougher, improves taste, adds color, and makes the tablet easy to handle and package. There are two types of coating  Sugar coating  Thin film coating Sugar coating is used to avoid the bitterness of some tablets. Coating is sprayed as a solution using a spray gun. Water based solution is used for coating. This presents a challenge in applying and quickly removing this water based solution so it does not disrupt the integrity of the tablet. Tablet film coating equipment has evolved to enhance drying capability. Essentially a tablet coating system is much like fancy clothes dryer. The water based solution is sprayed in a very fine mist so as to dry almost immediately as it reaches the tablets. As the water dries it leaves the solids as a thin film on each tablet. Page | 27
  28. 28. The coating system continuously supplies hot air, at the same time pulling air through small holes in the coating drum. The drum is commonly referred to as the coating pan, with small holes called perforations. This process can take as little a 30 minutes or it can take several hours. Tablets must be tough enough to tumble while the solution is added. The solution is distributed from tablet to tablet during the tumbling and drying process. The spraying, distribution and drying all takes place at the same time. Coating system consists of the coating pan, spraying system, air handling unit, dust collector and controls.  The coating pan is really a drum within a cabinet, allowing for control of air flow, air temperature and controlled solution application.  The spraying system consists of spraying guns, a solution pump, tank & mixer and air lines. The solution is pumped into the guns and the air combines with the solution for atomization into a very fine mist.  The air handling unit (AHU) is basically a way of heating and filtering the air. Dehumidification and/or humidification maybe needed depending on your location and application requirements.  The Dust Collector collects the dust during the pre heat and tumbling cycles and the Controls connect all of the components creating a complete coating system. (fig: Page | 28
  29. 29. Tablets are loaded into the coating pan, creating a bed of tablets. There must be enough tablets to attain good mixing, but not too many or the tablets will spill when the door is opened. Consistent batch sizes are important to attain consistent results. The tablet bed is tumbled slowly, as the warm air is introduced; the dust collector pulls the dust off the tablets and into a collection bin. When the tablet bed temperature reaches the proper temperature the spraying can begin. Once tablets have an initial base coating the spray rate can be increased. Tablet defects can occur if the temperature, spray rate and air volume are allowed to fluctuate. Production of capsules Formation of capsules involves various steps like 1. Mixing 2. Drying 3. Powdering 4. Lubricating 5. Encapsulation ( Fig: The steps mixing, drying, powdering and lubricating are same as that in followed in the production of tablets. The step encapsulation is explained below. ENCAPSULATION n this step, the lubricated powdered is filled in empty hard gelatin capsule. Commonly referred to as capsule filler, the encapsulation machine has the ability to fill Powders into a two piece (cap and body) capsule. The capsule filler must first position all of the incoming capsules into an upright position (rectification), separate the cap from the body (top from bottom), attain the proper fill volume (capsule weight), and then the product filled body is rejoined with the cap and ejected from the machine. Automatic machines have speeds up to 90,000 per hour. Page | 29 MIXING DRYING POWDERING LUBRICATINGENCAPSULATIO N
  30. 30. Gelatin capsules that are old and improperly stored can dry out and become brittle; they have a rather high defect rate when compared, say, to finished tablets. Even with all the quality check points many capsules are unusable by the time they reach the production floor. Common Capsule defects include: Dented, cracked, split, over size caps, and empty capsules after the filling cycle. CAPSULE CARE: Gelatin capsules that are old and improperly stored can dry out and become brittle; they have a rather high defect rate when compared, say, to finished tablets. Even with all the quality check points many capsules are unusable by the time they reach the production floor. The gelatin capsule caps have to be stored in cold place nearly at a temperature of 21 degree Celsius. Common Capsule defects include: Dented, cracked, split, over size caps, and empty capsules after the filling cycle. PRODUCTION DEPARTMENT CHART PRODUCTION MANAGER Page | 30
  31. 31. DEPUTY PRODUCTION MANAGER ASSIST PRODUCTION MANAGER PRODUCTION OFFICER WORKERS (Fig: PACKING DIVISION In KSDP centralized packing is done. Here packing is done for tablets, capsules , liquids and powders after the quality check of the medicine. For packing various high grade machines are used which result in the safe and hygienic packing. Various types of packing adopted by the company are blister packing, loose packing strip and container packing. Page | 31 SUPERVISORS
  32. 32. Once the production of one batch is finished in its respective section, then they will give intimation to packing section. The labels on the packs are printed by both hand printing and machine printing. Once the packing is completed it will be transferred to stock. It will be accounted to stock register only after getting approval from the quality control department. Different colours of packing are used for different products to identify the products. BLISTER PACKING KSDP chose blister packaging because it seemed to be the most appropriate way to package the pill for effective administration. Thus the most important reason for introducing blister packaging technology was to offer patients a clearly marked individual dose, enabling them to check whether they had taken the prescribed drugs on a given day. Moreover, the drugs that were not taken remained in the original package and were fully protected against adverse external conditions. The patient could handle the blister package more easily and could store it more conveniently than conventional packages. Other advantages of blister packaging such as the prevention of broken glass bottles and reduced costs and higher packaging speeds relative to other packaging materials. Another important benefit became apparent later: It is easier to prove misuse with blister packaging than with conventional packaging. Five aspects in which blister packaging is better than conventional packaging. • product integrity • product protection • tamper evidence • reduced possibility of accidental misuse • patient compliance. Two basic types of pharmaceutical blister packages exist. 1. In first variety the cavity is constructed of clear, thermoformed plastic, and the lid is formed of clear plastic or a combination of plastic, paper, and/or foil. 2. The other type of package contains foil as an essential component of both webs, and its cavity is created by cold stretching. In KSDP the first type of blister packing is followed. THE BASIC CONFIGURATION OF BLISTER PACKAGING. Page | 32
  33. 33. (Fig: BLISTER PACKAGING MACHINERY Thermoform–fill–seal machines can operate at speeds <800 packages/min. Blister packaging machines typically operate with intermittent motion. The seal is made during the dwell time required for thermoforming. The essential parts band functions of an intermittently operating packaging machine include the following.  The unwinding station. The unwinding station supplies the forming films and the lidding material at a rate corresponding to the speed of the packaging machine  The heating station. The heating station raises the temperature of the plastic forming films to a level suitable for deep drawing. Forming films containing the Polyvinyl chloride (PVC) support material are heated to 120–140 8C. Polypropylene (PP) forming films are heated to 140–150 8C.  The forming station. The forming station forms the plastic blister cavities via compressed air or die plates  The cooling station. The cooling station cools PP films after the forming process. Laminates containing PVC do not need to be cooled. Page | 33 Product Lid Blister pack
  34. 34.  The feeding machine. The loading area fills the blister cavities with product. The feeding machine can be linked, or the product to be packaged can simply be swept into the blisters.  The sealing station. The sealing station heat seals the lidding material to the forming film that contains the product All heat-sealing methods mate the blister and lid under constant pressure for a specified time, during which heat is supplied. The mating surfaces fuse and bond, setting almost instantaneously when heat input stops.  The cooling station. The cooling station is necessary with all forming films. PP forming films must be cooled longer than other types of film.  Labeling through packaging. Packages are labeled, notched, and then marked with a batch number at the coding station. The perforating device makes a cross-shaped perforation along the sealing seams. At the punching station, the packages are then separated into sheets that typically contain from 10 to 20 individual blisters. The vision system checks the filled packages for defects. PACKING DEPARTMENT CHART Page | 34
  36. 36. The main aim of this department is to supply the products of the company to common man at economic rates. The two ways of marketing are 1. Government sale 2. Open market sale Government Sales The company enjoys preference in the purchase from the government of Kerala. The company supplies medicines to institutions coming under health and family welfare, community health centers of government of Kerala like primary health center, medical college hospitals, taluk and district hospitals. 60% of demand of health department of Kerala is satisfied by KSDP. KMSCL (Kerala medical service corporation)is authorized to collect and distribute medicines to all the government institutions under health department. The Major Institutions under health department are 1. Institution under director of health service (DHS) 2. Institution under director of medical education (DME) Institutions coming under DHS are government institutions like Panchayat, consumer fed, hospital under local bodies, cooperative hospitals , district hospitals, taluk hospitals, primary health centers etc. Under the DME come all the government medical colleges of Kerala. Open Market Sales KSDP started open market sales in 1978 initially in Kerala and later on expanded to other states like Tamilnadu, Andhra Pradesh by employing medical representatives in each state and appointing medical officers. At that time there was a separate medical division located in cochin in Kerala, Chennai in Tamilnadu, Hyderabad in Andhra Pradesh and Great kailash in Delhi. 23 products were marketed in various dosage forms. It gradually ceased in 1998 since KSDP does not have the sufficient infrastructure for the prescription drug market. Open market sales involves 1. Institutional sale 2. Prescription sale In institutional sales, list of products, rate of each product, details about the quality of products and a covering letter is send to various medical institutions. If they are satisfied with the rate and Page | 36
  37. 37. quality of the product, they give purchase order to the company and the product is distributed. The company now is not going for prescribed sales. The price of product is determined by the price fixing committee which consists of top officials of the company. The rate of the medicines in the open market sales will be 5 to 30 % increased rate than for the government sales. The company is not permitted to sell the medicines at same price to open market and government. Branding During 1984,the company had branded products such as supremol tab for co-trimoxazole, Brodilan tab for saltbutamol 2mg +Theophylline 100 mg,kaymox250& 500 mg for Amoxicillin trihydrate,Maxillin 250 mg & 500 mg for Ampicillin trihydrate,Symix 100ml for cough syrup. At present,the company distributes its medicine under trade name as there is only less open market sales in function. Eg:Paracentamol Advertisements And Promotion As the company is not concentrating in open market sales, there is no advertisement and promotional efforts. process ( open market sales- hospitals) Customer study, analysis and enquiry Contacting prospective customers (hospitals) Receiving Enquiries from Interested Customers Receiving Purchase Order Transfer of products to the customers Page | 37
  38. 38. Receiving payment (fig: Major Competitors For paracetamol 1. Modern pharmaceuticals, kerala 2. Nester pharmaceuticals 3. Themis pharmaceuticals 4. Borrughswelcome pharmaceuticals For amoxicillin 1. Gufic laboratories 2. Warmer Hindustan 3. Murugan pharmaceuticals 4. Nester pharmaceuticals For ampicillin 1. Modern pharmaceuticals 2. Ranbaxy pharmaceuticals 3. Nester pharmaceuticals STAFF STRENGTH OF MARKETING DEPARTMENT EXISTING STAFF NO REQUIRED STAFF NO Marketing manager 1 Deputy manager 1 Senior assistant 1 Assistant manager 2 Junior assiatant 1 Junior manager 2 Stenographer 1 Junior assistant 1 Total 4 Typist 1 Medical reps 5 Attender 1 Total 13 (table: STRUCTURE OF MARKETING DEPARTMENT Page | 38 MARKETING MANAGER Pharmaceuticals
  40. 40. Personnel function is the effective function of management which means getting effective result with people. It permeates the entire department, since each executive must depend upon his subordinates for good result. Now HR system is developed as a result of restructuring the company by the way of induction of young blood by recruitment and selection. This is under process. There was an elaborated organisational structure before implementing VRS. Presently there are 236 employees in the company including contract workers, trainees, casual employees. The main function of this department are  General administration  Human resource planning  Recruitment and induction  Wages and salary  Training and development  Performance appraisal  Welfare measure  Labour relation. General Administration General administration includes a. Time keeping The company now has mainly four shifts  Production shift 1 - 6.30 am – 2.30 pm  Production shift 2 - 2.30 pm – 10.30 pm  Production shift 3 - 10.30 pm – 6.30 am  Office / general shift - 9.00 am – 5.00 pm Office maintains all attendance records of employees. An unauthorized absence is reported to appropriate section. It maintains records of any medical leave, compensatory leave, overtime offs, break more than half hour, on duty leave etc. This attendance list helps in the wage calculation. Time office use punching system for entry and exit of the permanent employees. In the case of late attendance up to 15 minutes, the concern department should give consent to the employees because the punching system cut off automatically after 15 minutes. Late attendance after 15 minutes is not Page | 40
  41. 41. allowed. Punching two cards by the same person is prohibited. The minutes are added up for one month and deduced from salary or wage. b. Employment administration includes  Maintaining details of agreed strength and actual strength.  Statistical data related to employees  Sending report relating to manpower  Maintaining seniority list and positions. c. Maintenance of personal records d. Contract labour management e. Formulating HR policies and procedure f. Issue office order, notices and circulars g. Administration of various schemes and agreement h. Administration of quality management system Recruitment And Selection The company mainly goes for two ways of recruitment. They are 1. Direct recruitment 2. Public service commission (PSC) Direct recruitment is done by publishing vacancies in newspaper and selected by conducting interview or tests as per the interest of the company. Direct recruitment is done for selecting managers, technical staffs, clerks etc. Security, receptionist, phone operators, drivers, peon are recruited by PSC. In KSDP, currently new recruitment process is being carried out for the betalactum plant operations. Moreover at the time of financial crises most of the permanent employees took VRS. The company is now planning to recruit employees in those vacancies. In selection first the applicants are screened on the basis of their qualification, experience, age, sex, additional qualification. If the number of applicants is more, a test is conducted before interview. Unstructured and job based interviews are conducted in KSDP. Page | 41
  42. 42. Induction Usually, for the newly employed personal, KSDP assigns a probation period that may extend from 6 months to 1 year. After the probation period is over, these personnel are only employed if the officials are confirmed of their ability. Training And Development In KSDP, training is given due importance. For newly recruited employees, usually on the job training is given. Training is given for existing employees if there is any change in technology. When new machines are introduced, training is given. In such cases off job training is given by the companies from where the new machine is purchased. Currently, due to lack of adequate financial assistance by the government no development process is being carried out. Performance Appraisal The section head of each department assess the work norms i.e. duties and responsibilities and achievement of the worker. Organizational behavior and attitude of the employee towards the job is evaluated and then the head of each department prepare a performance appraisal report. This report is then forwarded to the HR manager. The HR manager then takes necessary actions depending upon the performance of employees. Increments, incentives, gifts, or promotion is given to the employees whose performance is good. Thus the employees are motivated to get more productivity. Evaluation Process Based on 1) Assessment of job - Job knowledge - Planning, organizing, control and coordinating - Work output - Cost consciousness - Attitude to work Page | 42
  43. 43. - Knowledge of current trends & developments pertaining to his general fields of work 2) Professional & managerial abilities - Ability to inspire, motivate & develop subordinates - Decision making & judgments - Initiative - Communication skill - Theoretical & analytical ability - Leadership & team building - Sense of responsibility - Dependability 3) Personal qualities - Integrity - Attitude towards Organization - Discipline - Cooperation & team spirit - Capacity to withstand stress - Interpersonal relationship - Welfare Measures There is a welfare fund called Kerala Labour Fund through which the company gives assistance to the needy employees. For disease aid for employees with a salary less than Rs.10,000, 1.75% of the employee’s salary is taken along with 4.75% contribution by the company, in total the employee shall be provided with 6.5% of the salary along with the monthly salary. In case of an employee’s death before retirement, under dying harness scheme, employment is given to the deceased employee’s family member. The company also give aid for the employee’s children. Health And Saftey KSDP believes Page | 43
  44. 44.  In safety and health policy of their employees environmental cleanliness  That a work place which is free from hazards, accidents, and pollution enhances productivity and quality of products  That accidents and pollution cause unfold suffering and loss not only to the employees but also to the company and society Safety measures adopted by the company are  Good plant layout, machinery, equipment, tools and facilities  Giving on the job training and thus making the workers familiar with the working environment.  Providing mask for the workers to ensure that an emission from the pant does not affect their health. In KSDP, the employees are subjected to Medical check – up yearly. Moreover, Accident Benefit is given by ESI to the employees in case of occurrence of accident. Grievance Handling The management has been following an open door policy, which ensures that grievances raised by employees are given a fair hearing and solutions are provided. Grievances are either individual grievance or collective grievance. It is addressed by the employee to the HR manager. If the grievance is individual grievance, then the individual directly presents it before the HR manager, if it’s a collective grievance, then its presented before the HR manager through trade unions. Common grievances that can occur in the organization are regarding the wage or payment (other than monthly salary), Leave, Inter-department transfer, Promotion, Seniority, Work assignment, Working condition Procedure  The aggrieved Employee shall first present his grievance orally to his section head within 24 hours of the instance of such grievance and the section head will inquire into the matter and give his answer orally.  If the grievance is not settled by the above mentioned method, the grievance is reported to the personnel manager. This is for the case of individual grievances. In the case of collective grievances the trade union directly presents the grievance before the personnel manager. Page | 44
  45. 45.  Meetings will be held with trade unions to solve the grievance. If its not solved then trade union conducts meeting with the board of the company including all the top officials and the MD. Most of the grievances are solved within the company itself.  If the grievance is not solved in this stage, then they go to the labour commission, and then finally to the administrative tribunal. Trade Unions In KSDP, there are 4 trade union viz... i. INTUC-Indian National Trade Union Congress ii. CITU-Centre of Indian Trade Union iii. AITUC-All India Trade Union Congress iv. Staff Union Disciplinary Actions There are specific rules and regulations in the company. If any employee violates the rules punishment will be given to the employee in the following order.  As a part of natural justice an opportunity for fare hearing will be given.  If the employee is found to be guilty by the management after the enquiry, warning letters will be given.  Other punishments like withholding increment, downgrading, suspension, dismissal etc can be given to the employee based on the level of the employees guilt. STRENGTH OF THE COMPANY AS ON 1.05.2013 ( table: Position Number Supervisory / managerial 21 Staff 24 Workers 189 Contract 115 ITI trainees 28 Graduate trainees 10 Diploma trainees (D. pharm ) 1 SDC trainees 7 Attender – through employee exchange 1 Casual employees 19 Page | 45
  47. 47. 3.8.4 FINANCE DEPARTMENT Finance may be defined as the provision of money at the time when it is required. Business finance is an activity or process which is connected with the acquisition of funds and distribution of profits by a business firm. To carry on the business operation and to achieve its targets the finance department is very important. So the finance department is interacted with other departments. KSDP Ltd has given prior important to the Finance and Accounts Department. In 1983 vitamin A plant was set up and it was closed down in 2000 due to heavy loss. The loss was due to high cost of production. In 2009 government gave an assistance of 10 crores to survive the financial crises of the company and with this the betalactum plant was set up to manufacture the antibiotics. This year a betalactum injection project is planned for 4.84 crore. The marketing expenditure is much less since there is no open market sale now. Another manufacturing plant is planned for the year 2014 worth 65 crore. This plant is for non betalactum medicines. The total turnover for last year is 36.2 crore. The accounts are computerized ( tally accounting software) from last 10 years It has different section they are  Ledger section  Party bills section  Payroll section  Cash and computer section  Internal audit section  Costing and finalisation of accounts  Working capital Page | 47
  48. 48. 1. LEDGER SECTION Ledger section performs function such as passing and settlement of all miscellaneous advances, freight advances, and local purchases, personal accident claims of all employees, bill connected with work/telephone/water charges/excise duty etc. 2. PARTY BILL SECTION This section deals with service bills for rendering services such as telephone.typewritter, computer etc. Service bills are usually for the contract nature with respect work under supplied. The accounts department certifies bills and prepares cash/cheque payment accordingly. This department prepare the vouchers for the above and these vouchers are sent to cash department for drawing cash. A separate file is maintained for every supplier. In case of an extra item supplied by the supplier the supplier, a purchase department sends an amendment order to finance department on bills are prepared accordingly and a copy will be sent to store section. If the supply is less than the order placed no payment is made unless and until full quality of material supplied. The types of payment made by the suppliers are  Advance payment  Payment against credit  Payment through bank 3. PAYROLL CASH AND COMPUTER This section deals with salary computation with respect to attendance, overtime work, leave and recoveries in accordance with time office and personal department. Vouchers have been sanctioned and cash/cheque issued from the cash section. Salary details are obtained from computer with gross and net amount, salary account is prepaid monthly. Advance amount is given to employees are recovered from next month salary. Allowance like festival allowance, house rent allowance, medical allowance and dearness allowance etc. Are given to employees. 4. INTERNAL AUDIT Page | 48
  49. 49.  Securities of all personal files of all employees of the unit relating to annual increment, promotion, transfer etc.  Scrutinizing all purchase proposals, comparative statement connected with supply order and purchase.  Scrutinizing pay fixation statement, arrears pertaining to pay provision and other connected work o all employees.  Scrutinizing of several specific cases apart from the above work as directed by top authority. 5. COSTING SECTION Costing section deals with the preparation of Quarterly Financial Reports, Monthly profitability reports, budjects bank statement etc.profitability trend & wages analysis is done on the basis of monthly reports. 6. FINALIZATION OF ACCOUNTS This section deals with the preparation, co-ordination & assists in the preparation of final accounts of the company. It also assists the auditors of the company. 7. MANAGEMENT OF WORKING CAPITAL The fund given by the Government is used as the working capital by the company. SIGNIFICANT ACCOUNTING POLICIES a. FIXED ASSET & DEPRECIATION i. Fixed asset- fixed assets are stated at cost of acquisition inclusive of freight, duties, taxes, incidental erection expenses, commissioning expenses, pilot plant batch expenses and interest etc up to the date of commercial production. ii. Exchange difference on account of foreign exchange fluctuation is adjusted in the carrying cost of fixed asset. iii. CENVAT credit availed on purchase of fixed assets is reduced from the cost of respective assets. DEPRECIATION i. Depreciation on plant and machinery and factory building is provided on written down value method at the rates specified in schedule 14 of the companies Act, 1956. Page | 49
  50. 50. ii. Depreciation on fixed assets added during the period is provided on pro data basis with reference to the date of addition iii. Depreciation on disposed assets are not provided for depreciation during the year od disposal. CAPITAL WORK IN PROGRESS Capital work in progress includes advances on capital account. INVENTORIES i. Stock of raw materials and packing material are valued at cost on FIFO method. Work in progress is valued at cost. ii. Stock of finished goods of formulation division is valued at cost price or market price whichever is lower iii. The stock are valued only for serviceable items RESEARCH AND DEVELOPMENT i. Revenue expenditure on research and development is charged to profit and loss account in the year in which it is incurred. ii. Capital expenditure on research and development is treated as addition to fixed assets. FOREIGN EXCHANGE TRANSACTION Transactions in foreign currency are recorded at the exchange rate prevailing as on the date of transaction. Current assets and liabilities are reinstated at year end exchange rates and the profit and loss account. INTER DIVISIONAL TRANSFERS Inter divisional transfers of goods for captive goods are done at estimated cost. The same are shown as contra items in profit and loss account. However, excise duties, if any are treated as expenditure of company. This accounting treatment has no impact on the profit or losses in consolidated profit and loss account. RETIREMENT BENEFITS i. Provident fund and pension fund : Contribution to provident fund and pension fund as per the requirement of the application laws are charged to revenue on accrual basis ii. Gratuity plans : gratuity liability of the company is covered by the group gratuity scheme of Life Insurance Corporation of India. The life insurance corporation of India will pay the Page | 50
  51. 51. eligible gratuity of the employees during registration. The scheme stands withdrawn because of the non-payment of premium from 2000 bonwards, and so on provision for premium. iii. Salary and other amenities payable to VRS opts for the period of December 2003 to September 2004, is estimated as Rs 225 lakhs, but it is not provided in the accounts because the liability is not accepted or approved by the board of directors. EXCISE AND CUSTOMS DUTY i. Excise and customs duty payable in respect of finished goods and raw materials lying at factory or bonded premises are accounted for clearance or deboning. ii. CENVAT credit of excise duty availed during the period has been adjusted against excise duty amount. SUNDRY DEBTORS Credit balance in debtors accounts are treated as advance from customers and shown under other liabilities. Accounts having a credit balance and remains non performing since 1-04-2000 is totaled to Rs 214961. DISCOUNTING OPERATIONS Vitamin A division is defunct during the year. GRANT/ SUBSIDIES Grants or subsidies received in capital nature for specified purpose of purchase or construction of fixed assets are deduced from the gross value of fixed assets. In case of grants received in revenue nature, same is recognized on receipt basis in profit and loss account. Grants in nature of promoter’s contribution are treated as capital revenue under reserve and surplus. SEGMENT REPORTING One among the two business segments is defunct during the year. So no segmental reporting is made. PROVISIONS AND CONTINGENT LIABILITIES These are recognized as per AS 29 provisions, contingent liabilities and contingent assets. Page | 51
  52. 52. Finance Department Chart Page | 52 Manager Deputy Manager Junior Manager Accounts Officer Senior Assistant General Assistant Junior Assistant Cashier Sub-Staff
  53. 53. (fig:3.8.4) 3.8.5 MATERIALS DEPARTMENT The materials department has purchase and stores division. The purchase division of material department deals with the purchase of good quality raw materials at the lowest price while stores division deals with the storage of raw materials, finished goods and packing materials. PURCHASE DIVISION The function of purchase division is to buy right products at right price from right source with maximum monetary benefits. Production planning department will give list of requirement of raw materials. KSDP board is following a purchase procedure for giving the order of raw materials. They invite quotation based on the annual requirement with the details provided by the production planning department. The quotation is specifically sealed quotation. In emergency cases the quotations can based through mail or fax. The venders have to register in the KSDP website before sending the quotation. Once the sealed quotations are received the officials of three departments namely purchase, finance, and the user department open it and enter the details of the quotation in the register. A comparative statement is prepared with the rate, tax, vat, transportation charge, handed cost of all vendors. The purchase committee includes managing director, senior manager (purchase), accounts manager, quality control manager and manager of the concerned section. The final statement will be presented before MD along with the recommended. The negotiation is conducted and the final decision will be taken by the MD. The purchase order will be placed to the selected vendor. 80% of the payment is done before reaching the raw materials in KSDP. The remaining 20% will be paid once the quality is been tested and satisfied. Page | 53
  54. 54. The purchase order will be placed at the reorder level. It will take minimum 45days to get the raw materials once the purchase order is placed the buffer stalk will be maintained to meet the requirements. STORES DIVISION The main function of the stores department is to store the raw material and the finished goods There are 3 types of stores  Raw materials store  Finished goods store  Packing material In raw materials store, the raw materials that are procured by the company are stored and are used as per demand. These raw materials are firstly subjected to quality control tests and then only they are sanctioned for production purpose. The antibiotics and foils are stored in A/C rooms as the foils shrink on high temperature. The raw materials stock will be checked in every 15 days. The stores department checks the invoice number, production date, expiry date of the received goods. The stores requisition note shows to which section is the raw material purchased. In finished goods store, the finished goods are stored after they have been subjected to quality control tests. This store consists of only those finished goods that are given ‘pass card’ by the quality control department and then dispatching of the finished goods is done. The finished goods after quality check is packed and a transfer note is given to stores department. Based on the orders from the government, dispatching is done. The expired materials are disposed. The disposal committee has to approve and pays the excise duty to the government. The processing of supply orders are being scrutinized by the stores and supplies are being effected on the basis of FIFO (fist in first out). All the documentation regarding the receipt and supply of goods or materials are done in the stores department. This department has got a separate wing in connection with the work of excise duty. They are maintaining a systematic record system including kardex (carded) system. Page | 54
  56. 56. (Fig:3.8.5) 3.8.6 QUALITY CONTROL DEPARTMENT Quality control department is an essential part of an organization ,which determines the quality of the products and also the raw materials required for manufacturing and packing of products .All the incoming and outgoing materials are thoroughly checked at QC. This process is done through two distinct quality check 1. Incoming quality check 2. Outgoing quality check Incoming quality check is to check the quality of raw materials that is required for the production and packing .Outgoing quality check is to evaluate the quality of finished products. INCOMING QUALITY CHECK Once the goods arrived in the store, they will inform the QC through EIAIRN FORM. Then the QC department will take the samples for quality check based on the formula n+1.The testing process will be done on different procedures required for the INDIAN PHARMACOPOEIA If the materials have the quality then the store will issue an ok card to the store. The raw materials are received only after getting approval from QC. OUTGOING QUALITY CHECK Once the product is finished, the concerned sections will intimate and the QC will test the finished products according to the official books. If the test is ok, then pass card will be given to the concerned unit, packing and planning. If the finished product does not stand to the appropriate standards then the QC will ask for reprocess. Some tablets, capsules and liquids will take 1-2 days of Page | 56
  57. 57. testing time where the injection will take 7 days of testing time. All tablets and capsules will have to be tested for friability, disintegration, identification, dissolution, assay, etc. Every detail of each batch will be recorded in the quality control register. All the tests are recorded in fair records with the sign of concerned person who has done the testing. Then a protocol report is prepared to marketing section, which is signed by the manager and deputy manager of QC. The raw materials will be kept in polythene bags till the expiry date, as a control sample. A code number is given to the each sample, which will describe the year, month and batch of production. Raw materials and packing also have these numbers. All details of the materials are included in ‘goods information advice come goods receiving note ‘ Five copies of this note will be given to different departments namely quality control, store ,accounts, purchase and file copy . Quarantine Reference no [QRF] : This no will be entered in the register in the quality department for the analysis of the supplier/manufacturer of the raw material.QCR no quality control register no is entered after the material pass the test an 8 digit no is used for the passed material. Main two tests conducted after the tablets are 1. Friability test This test is done to check the brittleness of the tablets produced.From the produced lots, few number of tablets are taken and are weighed together. Then they are put in a machine and rotated for about 3 minutes. It is quite obvious that during rotation , the tablets will undergo wear and tear and some of them may also break. After rotation also the weight is noted. And if the difference in weight exceeds a specific limit , then that particular lot is rejected. 2. Solubility test This test is done to check the solubility of the tablet .as the tablet has to ultimately dissolve in the stomach , it is very important to check its solubility in the stomach’s temperature. Therefore , the tablet is put inside an apparatus with water which has temperature in parity with the stomach’s temperature. And the tablet is moved up and down with moderate speed in the apparatus. In this situation, the tablet can dissolve or not dissolve .if it dissolves, then the lot is accepted. Page | 57
  59. 59. ( Fig:3.8.6) 3.8.7 RESEARCH AND DEVELOPMENT DEPARTMENT The research and development department center of KSDP is fully integrated unit consisting of research laboratories analytical instrument laboratories and mine pilot plant. The gross value of research and development assets in terms sophisticated equipment and pilot plant equipment amounts to Rs 28 lakhs. The major objectives of this has been  Product development and analysis of raw materials and finished product of the formulation division using sophisticated instruments such as UV, IR, Gas chromatograph, high performance liquid chromatography.  Produce the existing products using new processes to reduce cost, time etc. cost can be reduced by replacing existing raw materials with new cost effective raw materials.  Identify the fast moving products in the market and produce them with KSDP’s own technologies. ACHIEVEMENTS OF R & D DEPARTMENT  Formulation of new trade products such as kayvit, feeling fresh and eva cream.  Perfumery materials, geraniol and methylhpteneon were separated on commercial scale from the non- citral portion of lemon grass oil, thereby providing value addition to the extent of 125 % to the by – product. Page | 59
  60. 60.  In the production and rearrangement of 3 –pentol to 1-pentol , the solvent was changed from toluene to isopropyl ether, the reaction time was reduced from 12 hours to 6 hours resulting in substantial savings in terms of yield, assay etc.  A new formulation which contains vitamin A and vitamin D3 was developed for animal health .this product was marketed by the company. R & D STRUCTURE (Fig:3.8.7) 3.8.8 SECURITY AND VIGILANCE DEPARTMENT Company has well established security and vigilance headed by security superintendent and vigilance officer. Security department is responsible for safeguarding the company’s functions as a whole. They shall not allow an unauthorized person in and around his duty place. They strictly monitor the Page | 60 MANAGER (R &D) SCIENTIST A SCIENTIST B SCIENTIST C LAB ASSISTANT 1 LAB ASSISTANT 2 SCIENTIST B
  61. 61. movement of the workers, materials, and vehicles within the company. They won’t allow anyone to enter the company without valid pass or identity cards and authorization. All movements in and out through the main gate will be recorded in the relevant registers and in the general diary. Different registers like visitors register, vehicles register (company vehicle only), contract workers register, kudumbasree workers register, trainees register, project trainees register are maintained by the security at the main gate. Raw material entering and finished goods outgoing are also recorded. At a time there should be three security guard present in the company. In total there are 7 security guards in the company. SECURITY AND VIGILANCE CHART Page | 61 HEAD OF THE DEPARTMENT SECURITY OFFICER VIGILANCE OFFICER STENOGRAPH ER HEAD GUARD ASSISTANT OFFICER
  62. 62. (fig:3.8.8) 3.8.9 MAINTENANCE DEPARTMENT Maintenance division in KSDP is mainly divided into two sections. 1. Mechanical engineering department. 2. Electrical engineering department These departments are considered as service sections in this organisation because maintenance department will give service to all departments. There function is to provide helpful environment so that all operations can be carried out in a flow. OBJECTIVES OF MAINTENANCE DEPARTMENT 1. Effective management of machine tool. 2. Minimization of heat loss and stream line. 3. Reduction in heating related breakdowns in packing machines Page | 62 SECURITY GUARD HOUSE KEEPING CLASS HOUSE KEEPING CLASS HOUSE KEEPING CLASS SECURITY GUARD SECURITY GUARD
  63. 63. 4. Standardization of temperature controlling packing machine. 5. Implementation of total productive maintenance. MAINTENANCE DEPARTMENT CHART Page | 63 MAINTENANCE MANAGER ELECTRICAL MECHANICAL A/C FOREMAN FOREMANFOREMAN SPECIAL GRADE A SPECIAL GRADE ASPECIAL GRADE A WORKMEN
  65. 65. 4.1BALANCE SHEET OF PERVIOUS THREE YEARS 4.1.1BALANCE SHEET AS ON 31- 03- 2008 SOURCES OF FUNDS As on 31- 03-2008 Amount in Rs 1. Share holders fund a. Share capital 90,794,000 b. Reserves and surplus 2,967,198 2. Loan fund a. Secured loan 20,214,012 b. Unsecured loan 726,391,398 3. Deferred tax liability 843,961 TOTAL 841,210,569 APPLICATION OF FUNDS Page | 65
  66. 66. 1. Fixed assets a. Gross block 117,402,960 b. Less depreciation 106,673,102 c. Net block 10,729,858 2. Capital work in progress 0 3. Current assets , loans and advances a. Inventory 17,619,297 b. Debtors 22,124,400 c. Cash and bank balances 1,686,723 d. Loans and advances 8,386,522 49,816,942 Less current liabilities and provisions a. Current liabilities 161,275,705 b. Provisons 4,230,446 165,506,151 Page | 66
  67. 67. Net current assets -115,689,209 4. Profit and loss account 938,187,275 5. Miscellaneous expenditure To the exent not written off 7,982,645 TOTAL 841,210,569 (Table:4.1.1) 4.1.2 BALANCE SHEET AS ON 31- 03- 2009 SOURCES OF FUNDS As on 31- 03-2008 Amount in Rs 4. Share holders fund c. Share capital 90,794,000 d. Reserves and surplus 2,967,198 5. Loan fund c. Secured loan 20,407,006 d. Unsecured loan 844,476,999 6. Deferred tax liability 789,864 Page | 67
  68. 68. TOTAL 959,435,067 APPLICATION OF FUNDS 6. Fixed assets d. Gross block 117,950,328 e. Less depreciation 107,847,551 f. Net block 10,102,777 7. Capital work in progress 13,695 8. Current assets , loans and advances e. Inventory 17,884,483 f. Debtors 43,473,974 g. Cash and bank balances 73,561,617 h. Loans and advances 11,135,849 146,055,923 Less current liabilities and provisions c. Current liabilities 171,884,483 d. Provisons 4,149,433 175,334,248 Net current assets -29,278,325 9. Profit and loss account 978,596,920 TOTAL 841,210,569 (Table:4.1.2) 4.1.3 BALANCE SHEET AS ON 31- 03- 2010 Page | 68
  69. 69. SOURCES OF FUNDS As on 31- 03-2010 Amount in Rs 1. Share holders fund a. Share capital 90,794,000 b. Reserves and surplus 2,967,198 2. Loan fund c. Secured loan 0 d. Unsecured loan 884,699,182 3. Deferred tax liability 765358 TOTAL 979,225,738 APPLICATION OF FUNDS 1. Fixed assets a. Gross block 117,910,831 b. Less depreciation 108,733,016 c. Net block 9,177,815 2. Capital work in progress 6,958,518 3. Current assets , loans and advances a. Inventory 33,239,142 b. Debtors 43,729,529 c. Cash and bank balances 73,691,790 d. Loans and advances 15,009,409 165,669,870 Less current liabilities and provisions a. Current liabilities 163,307,437 Page | 69
  70. 70. b. Provisons 4,027,258 167,334,695 Net current assets -1,664,825 4. Profit and loss account 964,754,230 TOTAL 979,225,738 ( Table:4.1.3) 4.2 PROFIT AND LOSS ACCOUNT OF PREVIOUS THREE YEARS 4.2.1PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31-3-08 Amount as on 31-03-2008 INCOME Gross sales less returns 87,616,270 Less Excise duty 10,591,030 77,025,240 Page | 70
  71. 71. Other income 48,941 Increase or decrease in stock 8,574,737 TOTAL 85,648,918 EXPENDITURE Cost of Materials Consumed 47,147,416 Other Manufacturing Expenses 5,039,521 Payments and Amenities to Employees 33,604,475 Administration and Other Expenses 1,862,698 Page | 71
  72. 72. Interest And Finance Charges 41,066,081 Selling and Distribution Expense 511,152 Provision For Doubtful Debtors W/back -97,648 Provision for expired/non-moving stock -511,736 Depreciation on Fixed Asset 1,219,533 TOTAL 129,841,492 Prior Period Items 159,659 PROFIT/LOSS BEFORE TAX -44,352,233 Provision For Tax-Current Tax 0 Deferred Tax W/back 232,810 PROFIT/LOSS AFTER TAX -44,119,423 Page | 72
  73. 73. (Table:4.2.1) 4.2.2 PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31-3-2009 Amount as on 31-03-2009 INCOME Gross sales less returns 119,715,884 Less Excise duty 6,678,494 113,037,390 Other income 62,965 Increase or decrease in stock -5,082,311 TOTAL 108,018,044 EXPENDITURE Cost of Materials Consumed 62,494,225 Other Manufacturing Expenses 4,456,110 Payments and Amenities to Employees 35,276,747 Administration and Other Expenses 2,024,478 Interest And Finance Charges 41,186,837 Page | 73
  74. 74. Selling and Distribution Expense 2,659,385 Provision For Doubtful Debtors W/back 0 Provision for expired/non-moving stock -1,356,805 Depreciation on Fixed Asset 1,174,449 TOTAL 147915426 Prior Period Items 566,360 PROFIT/LOSS BEFORE TAX -40,463,742 Provision For Tax-Current Tax 0 Deferred Tax W/back 54,097 PROFIT/LOSS AFTER TAX -40,409,645 (Table:4.2.2) 4.2.3 PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31-3-2010 Amount as on 31-03-2010 INCOME Gross sales less returns 149,144,037 Less Excise duty 5,744,555 Page | 74
  75. 75. 143,399,482 Other income 25,815,503 Increase or decrease in stock 12,318,113 TOTAL 181,533,098 EXPENDITURE Cost of Materials Consumed 88,226,830 Other Manufacturing Expenses 4,092,860 Payments and Amenities to Employees 26,833,744 Administration and Other Expenses 1,443,503 Interest And Finance Charges 43,261,450 Selling and Distribution Expense 3,317,069 Provision For Doubtful Debtors W/back 0 Provision for expired/non-moving stock 0 Depreciation on Fixed Asset 1,082,978 TOTAL 168,258,434 Page | 75
  76. 76. Prior Period Items -543,520 PROFIT/LOSS BEFORE TAX 13,818,184 Provision For Tax-Current Tax 0 Deferred Tax W/back 24,506 PROFIT/LOSS AFTER TAX 13,842,690 (Table:4.2.3) 4.3 APPLICATION OF FUND Page | 76
  77. 77. (Fig:4.3) 4.4 SOURCES OF FUND (Fig:4.4) Page | 77
  78. 78. 4.5 COST BREAKUP OF 2010 (Fig:4.5) Page | 78
  79. 79. CHAPTER 5 SWOT ANALYSIS Page | 79
  80. 80. SWOT ANALYSIS SWOT Analysis is a tool for auditing an organization and its environment. It is the first stage of planning and helps marketers to focus on key issues.SWOT stands for strengths, weakness, opportunities and threats are external factors. An opportunity is a favorable condition in the environment. It enables the enterprise to consolidate its position. Growing demand is an example of an opportunity. A threat is an unfavorable condition in the environment. It creates risks example, threat of growing competition. Strength is an inherent capacity which an organization cause to gain competitive strategic, advantage over its competitors. Superior research and development facilities, for example enable a firm to develop new products and thereby gain competitive advantage. A weakness is an inherent limitation or constraint which creates a strategic disadvantage. For example, overdependence on single product is potentially risky SWOT Analysis helps an enterprise in matching its strengths and weakness with opportunities and threats operating in the environment. The data about the internal factors is taken from company’s details from officers and employees. The external factors can be analyzed by looking into current trend in technology and market. STRENTH  Only public sector organization in Allopathic Doing manufactory  It has experienced and dedicated employees  Manufacture High Quality products.  Being a Government company it has a very reliable image.  A well-equipped lab for ensuring quality, availability of R&D facility.  Good infrastructure and good landscape.  Adheres to strict quality controls.  Availability of cheap labour.  Good and efficient marketing system. Page | 80
  81. 81. WEAKNESS  Industry has low level of research and development capability.  increased cost of production.  Very slow in reacting to an opportunity.  lack of open market sales.  lack of working capital.  Dissatisfaction among employee regarding pay scale. OPPORTUNITIES  Produce reservation by the government will act in favour of the company  Acquisition of the Good manufacturing practice certificate will expand the horizons of market for the company.  The company enjoys good support from the government. THREATS  The machinery of the company has to be modernized.  The main source of working capital is the fund granted by the government.  Competitors are able to sell their products at cheaper price  Increasing number of private sector  Trade union problems  Pressure on prices from the private sectors  Fast changing technology.  Increasing competition. Page | 81
  83. 83. FINDINGS 1. The main strength of the company is its quality products 2. Sound working atmosphere 3. Safety measures are considered to be very important by the company 4. Employees are dissatisfied with the current pay scale of the company 5. KSDP is strongly committed to customer safety 6. Company stopped the production of vitamin A due to high production cost and lack of availability of raw materials. 7. Lack of sufficient employees 8. Canteen provides good quality food at cheaper rate 9. Negligible scrap rate at production 10. Employees are very co-operative 11. Employees are satisfied with health and safety measures. 12. The production process is carried as per the orders received from different tenders. 13. Potential for introducing variety products, scope for entering in international markets, full utilization of production capacity and opportunity for switching over to new technology are the opportunities of the firm. Page | 83
  84. 84. RECOMMENDATIONS 1. The machinery must be modernized at a fast pace which will contribute in decreasing the cost of production. 2. The company has to restart the open market sales especially the prescribed sales. 3. Propose to get sufficient assistance from government so that the company can work in a better way. 4. Adopt new technologies for production. 5. Steps may be taken by the management to set a separate lab for checking the quality of the products. 6. Steps may be taken by the management to form a separate stores department. 7. Steps may be taken by the management to set a separate lab for checking the quality of the products. 8. Initiatives may be taken by the management to introduce direct marketing of the product. Page | 84
  85. 85. CONCLUSION The privileged opportunity of one month organizational study proved out the nature of business firm and it had enabled me to have an exposure to the majority of the topics related to company’s,functioning,structure,policies,promotional,activities,working.environment,organizational culture etc… The significant of financial analysis in determining the performance is organization was also realized. This organizational study helped me to know about the company, the various departments; the functioning of various departments etc…it also helped me to know the practical applications of the theories in the business studies. The organizational study helped to gain knowledge regarding the functional as well as the managerial aspect of various departments in KSDP. Moreover it helped me to get familiarized with the real world organizational system and understand the decision making process in the organization. Organizational study in KSDP helped me  To familiarize with a business Organization.  To familiarize with the different departments in the Organization and their functioning.  To enable myself to understand how the key business process are carried out in Organization.  To relate theory with practice.  To develop my attitude conducive to effective interpersonal relationships. Page | 85
  86. 86. BIBLIOGRAPHY Books: 1. Stephen.P.Robbins,Organizational.BehaviourConcepts,Controversies,Applicatios.4 th Ed.Prentice Hall (2004). 2. Tompkins, Jonathan. R.”Organization Theory and Public Management”. Thompson Wadsworth. (2005). 3. Philip Kotler ; Kevin Lane Keller (2006).Marketing Management ,12th Ed. Reports: 1. Annual reports in 31st march 2010 2. Company manuals in 31st march 2012 3. HR MANUAL OF KSDP in 5th April 2013. 4. Journals and newsletters of KSDP in 5th April 2013. Websites: www.ksdp.com Page | 86
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