INTRODUCTION

Indian rubber is about hundred years old and has become third largest

industry of the nation after steel and textile industry. Rubber is Kerala’s primary

and prestigious crop. About 90% of the total rubber production in India is accounted

by the state of Kerala. It is cultivated in about 8, 90,000 hectares in the state and

nearly 67% of the total used is covered by rubbers plantation crops. Natural rubber

or natural CSI poly isoprene is produced from rubber tree HeveaBrasilienis. The

tree is also known as courthouse, a name given by Native Americans, which means

weeping tree.

Natural rubber is collected as a milky tapping rubber tree. The most common

method of tapping is cutting of thin portion of the bark in the shape of a half spiral

using a special tapping knife. The milky sap commonly called latex is a colloidal

dispersion in aqueous medium.

The rubber is separated from latex by coagulation. The common coagulant is

acid, preferable formic or acetic acid. The coagulant is separated and the absorbed

water removed by the passing through the pressure rollers. Subsequently the sheet is

passed through corrugated rolls to increase the surface area by rubbing. These

facilities are fast drying. These sheets are then dried in smoke house at a

temperature not exceeding 60 degree Celsius using hot smoke of burning wood. The

creosote compounds in the smoke provide a mild protection to the rubber.

Hanani Rubbers is one of the leaders in producing rubber mats in India. The

present study is an attempt to examine the organisational performance of the

organisation.

1

1.1 Scope of the Study

Hanani Rubbers is functioning with 7 departments such as administrative, finance,

purchase, production, sales, marketing and human resource. The scope of the study

covers the examination of the structure of the organisation, evaluation of function of

different departments and collecting information about its products and assesses the

potential for expanding its activities.

1.2 Significance of the Study

An organisation is a social entity that has a collective goal and is linked to an

external environment. By planning, organising, coordinating and cooperation from

various individuals, the organization is able to solve tasks that lie beyond the

abilities of a single individual. The present study on the organisational performance

of Hanani Rubbers is helpful to assess the gap if any in the application of well

accepted principles of management in day to day management and administration of

the company. The study is also helpful for the academicians to explore new ideas in

management and business managers for taking managerial decisions.

1.3 Objectives of the Study

The following objectives have been set for the study:

1. To acquire knowledge about the progress of rubber industry in India.

2. To study the management practices adopted in Hanani Rubbers

3. To study the functions of different departments and to assess the degree of

coordination in the departments.

4. To identify and examine the market potential of the products of the company.

5. To identify the strength, weakness, opportunities and threats of the company.

2

1.4 Methodology

The study has been conducted by collecting both primary and secondary data.

Primary data were collected with discussion with managers of different departments

and personal interviews with the employees and labourers of the company. The

method of observation is also adopted with a view to assess the relationship

between different departments, communication system in the organisation etc.

Secondary data were collected from annual accounts and reports of the company,

reports of rubber board and official website of the company.

Data Collection

Primary Data

1. Discussion: with managers of different departments

2. Data collected from employees through personal interview

3. Observation: by observing the functions of various departments

Secondary Data

Secondary data collected from various books includes:

1. Annual accounts and reports of the company

2. Company web site and general web site

3. Reports of Rubber Board

Reference Period

Secondary data were collected for the period of 5 years from 2007-08, 2008-09,

2009-10, 2010-11 and 2011-12.

3

1.5 Limitations of the Study

The limitations of the study are as follows:

1. The busy schedule of the employees might have resulted in not

incorporating in every aspects of the company.

2. As the confidential information was not supplied, the findings of the study

are arrived with a handicap of such information.

3. An extensive survey is not conducted in collecting primary data

4

Global Scenario

The production of rubber and rubber products is a large and diverse industry.

Natural rubber, obtained from plantations in Africa and Asia, accounts for only

about 25% of the rubber used in industry. Synthetic alternatives, developed during

World War II, are the primary sources of raw materials today.The world production

of rubber was considered to be very unstable during the last few years. The latest

rubber statistical bulletin and rubber industry report published by the International

Rubber Study Group for October-December 2011 states that, "Annualized global

rubber consumption reached 25.8 million metric tons by the end of the third quarter

of 2011, 6 percent higher than at the same point in 2010, reflecting a decelerating

increase in the demand for vehicles and tires. Global synthetic rubber production

was 7.5 percent higher than at the end of the third quarter of 2010, in line with the

relatively strong growth seen in the consumption supported by competitive prices,

while the global natural rubber supply was 4.1 percent higher than at the end of the

third quarter of 2010.

Indian ScenarioRubber producing regions in India are divided into two zones – traditional and non-

traditional.

Traditional zone include Kanyakumari district in Tamil Nadu and all districts of

Kerala.

Non Traditional zone includes coastal regions of Karnataka state, Goa, State of

Andhra Pradesh, some areas of Maharashtra, North-eastern states (mainly Tripura)

and Andaman and Nicobar Islands.

The Rubber industry in India has been growing. This is the result of India's

burgeoning role in the global economy. India is the world's largest producers and

third largest consumer of natural rubber. The high growth of automobile production

and the presence of large and medium industries have led to the growth of rubber

industry in India.

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India’s production varies from 6 and 7 lakhs tons annually which amount to Rs.

3000 crores. Seventy percent of the total rubber production in India is in the form of

Ribbed Smoked Sheets (RSS). This is also imported by India accounting for 45% of

the total import of rubber. The Indian rubber industry has a turnover of Rs 12000

crores. Most of the rubber production is consumed by the tyre industry which is

almost 52% of the total production of India. Among the states, Kerala is the leading

consumer of rubber, followed by Punjab and Maharashtra. The exports of Indian

natural rubber have increased tremendously over the years and have reached 76000

tons in 2003-04.Though, India is one of the leading producers of rubber but it still

imports rubber from other countries. At present, India is importing around 50000

tons of rubber annually. There are about 6000 unit comprising 30 large scale, 300

medium scale and around 5600 small scale and tiny sector units. These units are

manufacturing more than 35000 rubber products, employing 400 hundred thousand

people, which also includes 22000 technically qualified support personnel,

contributing Rs. 40 billions to the National Exchequer through taxes, duties and

other levies. The Indian Rubber Industry plays a vital role in the Indian national

economy. The rubber plantation sector in India produces over 630 hundred

thousand tonnes of natural rubber and there is a projected production of more than

one million tonnes in near future. This has helped in the radical and rapid growth of

the Indian rubber industry. This prospect of growth is further enhanced by a boom

in the vehicle industry, improved living standards of the people and rapid over-all

industrialization. The per capita consumption of rubber in India is only 800 grams

compared to 12 to 14 kilos in Japan, USA and Europe. So far as consumption of

rubber products is concerned, India is far from attaining any saturation level.

This is another factor leading to tremendous growth prospects of the industry in the

years to come.

Kerala ScenarioKerala contributes 90% of India’s total production of natural rubber. Also, Kerala

and Tamil Nadu together occupy 86% of the growing area of natural rubber.

Natural rubber is an elastomeric derived from latex of plants. The source of natural

rubber in Kerala is from the species Heveabrasiliensis. Actually rubber plant is not a

native

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plant of Kerala. Dutch colonialists brought rubber plant to Kerala. But at present

Rubber is an important source of Income for good number of Keralites. Kerala

accounts for 90% out of the total area under rubber cultivation in India. In Kerala

rubber is generally grown in the midlands and high lands including Kottayam,

Pathanamthitta, Kollam and Idukki. In 2009 the production of Rubber in Kerala

increased to 783,000 tonnes. Kottayam grows rubber in over 109,582 hectares and

produces 120,946 tonnes of rubber per annum. Kottayam, the fourth largest rubber

grower in India, produces almost nine percent of the world’s rubber. High price of

rubber has really warmed the Rubber planters in Kerala. But acute labour shortage

is affecting Rubber cultivation in Kerala.

7

A PROFILE OF HANANI RUBBERS

Hanani Rubbers was incorporated in the year 1981. After its incorporation Hanani

Rubber Industries has been a technological leader in manufacturing, supplying, and

trading high quality rubber products. Hanani Rubber Industries today offers a

diverse range of rubber products from the land of latex, Kottayam, South India.

Made exclusively out of pure natural rubber, straight from its own plantations,

Hanani products find demand in overseas market, worldwide.

Hanani Rubbers is proud to reveal that the products are widely distributed in world

class chain stores-Metro Cash & Carry, Auchan, OBI, Real, Leroy Merlen,

Castorama, Victoria, Hyperglobus, Carrefour, Home Centre through our buyers.

Hanani Rubber Industries an ISO 9001:2008 certified company a works towards

achieving total customer satisfaction. It is committed to give clients product and

service excellence by providing in time delivery and consistent products. It has a

highly skilled, competent, and experienced management team and manufacturing

staff with over 30 years of manufacturing experience. Hence, clients are guaranteed

that they receive only the best products and quality service.

All products pass through quality testing at every step of the production process

starting from the selection of raw materials and mixing of rubber compounds to

completion of the final product. Thus it ensures that each and every unit that goes

out of the production is the best quality.

Vision and Mission of Hanani Rubbers

"The vision is to be recognized as one of the leading manufacturers and suppliers of

molded rubber products. The mission is to ensure total customer satisfaction and

cost effectiveness by providing quality rubber products and delivering them to the

clients promptly."

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Objective of Hanani Rubbers

The company aims not just to be considered as a leading supplier of quality

materials but also to develop partnership with its clients, suppliers and

manufacturers.

Organisational Structure

An organizational structure consists of activities such as task allocation,

coordination and supervision, which are directed towards the achievement of

organizational aims. It can also be considered as the viewing glass or perspective

through which individuals see their organization and its environment. An

organization can be structured in many different ways, depending on their

objectives. The structure of an organization will determine the modes in which it

operates and performs.

Organizational structure allows the expressed allocation of responsibilities for

different functions and processes to different entities such as

the branch, department, workgroup and individual.

Organizational structure affects organizational action in two big ways. First, it

provides the foundation on which standard operating procedures and routines rest.

Second, it determines which individuals get to participate in which decision-making

processes, and thus to what extent their views shape the organization’s actions.

Fig. 1 explains the organisational structure of Hanani Rubbers. The top most

authority is the Managing Director followed by the Administrative Department

which controls all the other departments. The Purchase Manager, the Human

Resource Manager, the Production Manager, the Sales Manager, the Marketing

Manager, the Finance manager is assistant by their respective assistant under each

department. The middle level management comprising of assistants and supervisors

are supported by the workers comprising the lower level management in their

respective departments.

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Chart

10

WORKING RESULTS

The working results of the company during the period from 2007-08 to 2011-12 are given below:

Operating Profit

The operating profit ratio of Hanani Rubbers is given in Table 3.1.

Table 3.1

Operating Profit Ratio of Hanani Rubbers from 2007-08 to 2010-11

(Rs. in Crores)

YearOperating Profit (Rs.)

Sales (Rs.)

Operating profit ratio

(%)

2007-08 39.66 44.70 .89

2008-09 85.71 272.12 .31

2009-10 222.59 616.11 .36

2010-11 158.85 542.27 .29

2011-12 246.85 665.99 .37

Source: Audited Financial Statements for the period from 2007-08 to 2011-12

The Table shows that the operating profit of the company has increased Rs.39.66

crores in 2007-08 to Rs.246.85 crores in 2011-12. The operating profit ratio has

decreased 0.89 per cent in 2007-08 to 0.29 per cent in 2011-12. In 2011-12 the ratio

is 037 per cent.

11

The trend in the operating profit ratio is present in Fig.2

Trend in Operating Ratio

2007 2008 2009 2010 20110

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1

0.890000000000001

0.3100000000000020.36

0.29

0.37

Chart Title

Fig.2

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Net Profit

The net profit ratio of Hanani Rubbers is given in Table 3.2.

Table 3.2

Net Profit Ratio of Hanani Rubbers from 2007-08 to 2010-11

(Rs. in Crores)

YearNet Profit

(Rs.)Sales (Rs.)

Net profit ratio (%)

2007-08 26.47 44.70 .59

2008-09 52.12 272.12 .19

2009-10 157.73 616.11 .26

2010-11 105.83 542.27 .20

2011-12 152.02 665.99 .23

Source: Audited Financial Statements for the period from 2007-08 to 2011-12

The Table shows that the net profit has increased from Rs.26.47 crores in 2007-08

to Rs.157.73 crores in 2009-10. However it decreased to Rs.105.83 in 2010-11.

Again it increased to Rs.152.02 crores in 2011-12. The table also reveals that the

volume of sales has increased from Rs.44.70 crores in 2007-08 to Rs.665.99 crores

in 2011-12, recording an increase of 1389.92 per cent. The net profit ratio also

shows a decrease of 0.59 per cent in 2007-08 to 0.23 percent in 2011-12.

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The trend in the ratio of net profit to sales is presented in Fig.3

Trend in Net Profit Ratio

2007 2008 2009 2010 20110

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.590000000000001

0.19

0.26

0.20.23

Chart Title

Fig.3

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The present chapter discusses major characteristics of the products produced by the

company.

4.1. Ring Mat

This multipurpose heavy-duty mat can be used both indoors and outdoors as an

entrance mat, bath mat, laundry mat, snow mat, scraper mat or garden mat under all

weather conditions. They are durable, washable and can be used effectively on both

sides. Ring Mats are of modular design and can be joined to cover large floor areas

by using joiners.

PRODUCT SPECIFICATIONS:

Size in cm: 40x50, 40x70, 60x75, 50x100, 80x110, 100x150 approx

Thickness: 2.2 cm approx

Colour: True Black

4.2. Stud Mats

Stud Mats are covered with hundreds of flexible rubber studs/ fingers/

bristles which act as an effective cleaning medium. This mat offers cushioning to

the feet and helps minimize foot fatigue for jobs that involve prolonged standing. It

has an acupressure effect on bare feet.

PRODUCT SPECIFICATIONS:

Size in cm: 46x80, 60x100, 90x 140 approx

Thickness: 1 cm

Colour: True Black

15

4.3. Wiper Mat

Thin flexible wiper having ribs on the surface wipe away and remove sand and grit.

It is heavy duty cleaning mat. It is all weather resistant and very durable. Traps dirt

in design and prevents tracking. It prevents slipping on ramp ways.

PRODUCT SPECIFICATIONS:

Size in cm: 46x70, 60x100, 90x150 approx

Thickness: 1 cm

Colour: True Black

4.4. Radiator Mat

Soft rubber inter-woven plates form a unique design with great cleaning

efficiency and good anti-fatigue properties. Traps grit and sand within design and

does not allow tracking.

PRODUCT SPECIFICATIONS:

Size in cm: 45x75, 60x100, 75x90

Thickness: 1cm

Colour: True Black

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4.5. Square Mat

The square mat is a symmetrical designer class mat for use both indoors

and outdoors in all weather conditions. The mat is highly durable and its unique

square print design blends form with function. The differential level flexible stud

ensures proper cleaning and compliments any decor.

PRODUCT SPECIFICATIONS:

Size in cm: 40X60, 60x100 approx

Thickness: 1cm

Colour: True Black

4.6. Shoe Mat

Shoe mat is a durable, all-weather rubber mat suitable for indoor and outdoor use.

The unique foot print design with dual level flexible studs makes this mat very

effective in scrapping and collecting dust, sand and slush.

PRODUCT SPECIFICATIONS:

Size in cm: 40x60, 60x100 approx

Thickness: 1cm

Colour: True Black

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4.7. Stud Mat-Half Round

Another product catering to the increasing demand is for the popular half

round design. Sturdy studs, bevelled borders anti slip underside combined with all

weather capability make this product unique.

PRODUCT SPECIFICATIONS:

Size in cm: 45 x 75 approx

Thickness: 1cm

Colour: True Black

4.8. Honeycomb Mat

General purpose entrance mats. Attractive honeycomb design and holes

in mat trap dust and snow. Bevelled borders prevent tripping. These mats are very

durable and frequent washes do not affect life of the mats.

PRODUCT SPECIFICATIONS:

Size in cm: 40 x 70 approx

Thickness; 1 cm

Colour: True Black

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This chapter shows the functional department of Hanani Rubbers. There are seven

departments in the company. The functions of these departments are given below:

5.1. ADMINISTRATIVE DEPARTMENT

This department may coordinate all other department in the organization their functions are

1. Coordinate the activities of other department.

2. To provide proper guidelines to various departments

3. Inform the policy to other department.

4. To communicate the policies of the company to other department

The structure of administrative department is given in fig. 4

Structure of Administrative Department

Fig. 4

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ADMINISTRATIVE DEPARTMENT

PRODUCTIONDEPARTMENT

HR DEPARTMENT

SALES DEPARTMENT

PURCHASE DEPARTMENT

FINANCE DEPARTMENT MARKETING

DEPARTMENT

5.2. PRODUCTION DEPARTMENT

Production denotes the conversion of the raw materials to semi-finished or finished

product, with the help of certain production process. The main aim of any

production system is to produce economically the goods and services required by

the customer. Production is the process of transferring input into output. It is the

core of every business activities.

The structure of production department is given in fig 5

Structure of Production Department

Fig. 5

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Director

Factory Manager

Accounts Manager Admin Manager Production Manager

Shift Engineer

Loading Supervisor Shift Supervisor

Workers

Fig.5 describes the structure of production department of Hanani Rubbers. The supreme power vests in the hands of the Director. The Factory Manager comes below the Director. The Accounts Manager, the Administrative Manager and the Production Manager come under the Factory Manager. A Shift Engineer assists the Production Manager. Two supervisors’ viz. Loading Supervisor and Shift Supervisor fall below the Shift Engineer. Workers come below the Shift Supervisor.

Raw Materials

The main raw materials are:

a) Natural Rubber

b) Synthetic Rubber

c) Process Oil

d) Zinc Oxide

e) Anti-oxidants

f) Sulphur

g) Accelerations

Shift

The company adopts 3 shifts. These are:

First Shift - 8.30 AM TO 4.30 PM

Second Shift - 4.30 AM TO 12.30 PM

Third Shift - 12.30 PM TO 8.30 AM

In these shift100 workers are divided and work is assigned to them.

Average Daily Production

Rubber Mat - 1 ton

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Machines Used

The details of the machines used in production are given below:

1. K-4MK3 Intermix Accessories - 2

2. Air Compressor - 1

3. Mixing Mill with Accessories - 5

4. Extender with Accessories - 1

5. Calendaring Machine with Accessories - 1

6. 725 Kva Generator - 2

7. Dust Collector & Chimney - 1

8. Overhead Crane - 1

9. Electric Good Lift - 1

10. Hand/Mechanical Pallet Trunk - 4

11. Weight Bridge 30mt Capacity - 1

12. Electric Weighting Machines - 1

13. Industrial Vacuum Cleaner - 1

Quality Control

The word quality refers to the degree of excellence of a product. The compensation

today is cutthroat and every producer tries of to improve the quality of the product

to lure the customer. The Quality control is a systematic control of those variables

which affect the excellence of the ultimate product.

The company uses all types of production oriented quality control, Q1, Q2, Q3, Q4,

Q5, & Q6. The factory manager and the production manager are assigned for

quality control. The absolute quality controls are properly checked in the research

and development groups located at Kottayam.

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Production Sequence

It is the process of arranging the machines in to one line depending upon the

sequence of operation. Materials are fed in to the first machine and finished product

comes through the last machine. This process is called product layout or known as

straight line layout.

Input Output Process

Stage I - Input of Raw Materials

Stage II – Work-in-progress

Stage III - Output

Stage IV - Storage

Stage V - Despatch

Process of Manufacturing

The important steps involved in the manufacture of procured tread are described

below:

1. Mastication and Mixing

2. Maturation

3. Pre-warming

4. Extrusion

5. Cooling

6. Weighting

7. Moulding

8. Polishing

9. Inspection and packing

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5.3 FINANCE DEPARTMENT

Finance is the life blood of the business. For every activities related to business

finance is required. Finance is the study of how investors allocate their assets over

time under conditions of certainty and uncertainty. Finance is a simple task of

providing the necessary funds (money) required by the business of entities like

companies, firms, individuals and others on the terms that are most favourable to

achieve their economic objectives. A key point in finance, which affects decisions,

is the time value of money, which states that a unit of currency today is worth more

than the same unit of currency tomorrow. Finance aims to price assets based on

their risk level, and expected rate of return.

Maintenance of Accounts

Accounts in Hanani Rubbers are maintained as per the double entry principles. The

company maintain detailed account of its asset and liabilities, income and

expenditure. At the end of the year accounts are finalized and annual accounts are

prepared. They are properly audited.

The structure of finance department is given in fig. 6

Structure of Finance Department

Fig. 624

Director GM Administration Finance Manager

Data Entry Operator

Cashier

Fig. 6 shows the structure of the finance department of Hanani Rubbers. The Director is the supreme power. Director is assisted by the General Administrator. The Finance Manager falls below the General Manager Administration. Data Entry Operator and Cashier come below the Finance Manager.

The main function of finance department includes:

1. Preparation, submission and filing of Income tax return

2. Maintenance of relationship with banks

3. Identifying the sources of finance

4. Making arrangement for finance with different agencies

5. Financial analysis, planning and control

6. Management of the firm’s asset structure

7. Management of the firm’s financial structure

8. Assessing the financial performance and condition of the company

9. Estimating the financial needs of the firm

10. Forecasting and planning the financial future of the firm

11. Cash Management

12. Credit Administration

13. Management Account &Control

14. Internal Auditing

15. Funds Management

16. Preparation of Financial Report

17. Expense Analysis

18. Prepare profitability trend reports and wage analysis

25

5.4 PURCHASE DEPARTMENT

The company purchase of raw materials from approved suppliers only. The

approved given on the basis of quality text of raw materials price negotiations and

delivery. The company does make forecasting on purchase. The major purchase raw

materials like carbon, natural rubber are bought based on the principles of purchase.

The company adopt mainly just in time purchase.

The structure of purchase department is given in fig. 7

Structure of Purchase Department

Fig. 7

Fig. 7 explains the structure of purchase department. It comprises of the director at

the top level followed by the Director. The Purchase Manager falls below the

Director. The Office Superintendent and Office Assistant assists the Purchase

Manager.

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Director

PurchaseManager

Office Supdt

Office Assistant

Functions of Purchase Department

1. Raw Material Study

2. Market Intelligence Report Analysis

3. Purchase Policy

4. Turnover Analysis

5. Negotiation

6. Turnover Analysis

7. Purchase Order

8. Follow Up

9. Rating Under Supplies

10. Vendor rating

11. Purchase Monitoring Invoice Checking etc

Credit Pattern

Hanani Rubbers purchases are of bulk nature and payment is made on cash payment

basis. There is 0% credit against cash purchase. For certain raw materials like

rubber chemicals, the company does take a credit time of 15 to 30 days. The

company also provide advance payment for reputed suppliers.

Just in Time Purchase

The company adopts just in time purchase policies. Purchase is made at the

right time. The raw material like rubber is bought into production plant, in one day

advance of the production.

27

Purchase Pattern

The purchase pattern of Hanani Rubbers is shown in Fig. 8

Fig. 8

The figure shows the purchase pattern of the company. The company purchases

right quality material at right price and also makes sure it receives the materials at

the proper destination.

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A Right Quality MaterialB Right PriceC Right Delivery

5.5 MARKETING DEPARTMENT

Marketing concept was born out of the awareness that a business to start with the

determination of consumer wants and ends the satisfaction of those who wants.

Marketing is the economic process by which goods and services are exchanged and

their value is determined in terms of money.

The structure of marketing department is shown in Fig. 9

Structure of Marketing Department

Fig. 9

In the figure the Managing director is the top most authority. The General Manager of Marketing falls below the Managing Partner. Dispatch Manager Sales Officers and Service Manager come below the General Manager. Head of Sales Executive and Depot Manager come below Dispatch Manager Sales Officers and Depot Sales Executive below Depot Manager. Service men fall below the Service Executive.

29

Director

GM Marketing

Dispatch Manager Sales Officers

HO Sales Executives Depot Manager

Depot Sales Executive

Service Manager

Service Men

The Fig. 10 explains the marketing process of Hanani Rubbers.

Marketing Technique Adopted by Hanani Rubbers

Fig. 10

Marketing Strategy

Strategic thinking is the key to evolution of successful marketing. The strategies of

Hanani Rubbers involve the following analyses:

1. Understanding Markets: Strategic perspective of the market requires

skilful analysis of the trend and how they affect the market size and demand

for the firm’s product.

2. Finding market niches: Price, service, convenience and technology are

some of the niches in Indian Market.

3. Product and service planning: Analysis of the customer’s image of the

brand, both of the firm and competitors and analysis of the situation in

which the customer uses the product.

4. Distribution: Structural changes in inventory management, mobile

distribution process in the Indian market.

5. Managing for result: With pressure on costs, prices, and margins,

marketers will have to make effective utilization of every rupee spent in

marketing.

30

Product DespatchDepot DealersC & F AgentsCorporation

Customer

Market opportunity:

Identification of market opportunity is critical before the management of affirm a

decision to launch or diversify in any product area. This involves analysis of the

size of the market.

Size of the market

Marketing strategies and the extent and quality of services rendered by other firm

in the industry determines the size of the market.

Identification of key success factors in an industry and linking them to a firm’s

strengthens Hanani Rubbers. How Hanani Rubbers serves the market is explained

in the below Fig 5.8

The Process of Seeking Market Opportunities by Hanani Rubbers

Fig. 11

5.6 SALES DEPARTMENT

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Demand Conditions

Market segment analysis

Industry analysis

Trade analysis

Competition analysis

Market Opportunity

The concept of sales is that the company has to promote and push. Their products

are aggressively sold in the market. It cannot expect the product to get picked up

automatically by the customer.

Techniques for Improving the Sales

Heavy Advertising

Personal selling

Large scale Sales Promotion

The structure of sales Department is given Fig. 12

Structure of Sales Department

Fig. 12

The Fig.12 explains the structure of Sales Department of Hanani Rubbers. The

supreme power vests in the hands of the Managing Partner. Below the Managing

Partner falls the Director, followed by the Sales Manager. The Department Manager

comes below the Sales Manager. Stock Assistant, Accounts Assistant, Computer

Assistant and General Workers Assistant come below the Sales Manager.

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Director

Sales Manager

Department Manager

Stock Assistant Accounts Assistant Computer AssistantGeneral Workers

Asst

Function

The sale of Hanani Rubber products is based on the following sales policies and

norms:

1. Sales department receives the order from agents, dealers, contractors, etc

and passes the order to the factory for production.

2. Then the product is moved to the dispatch manager and is sold to the

customers as per the order.

3. Order receiving and dispatch are the major function of the sales department.

Distribution Channel

1. Direct Dealers

2. C & F Agents

3. Licensed Parties

4. Exporters

The company sells its products through the above distribution channels. Hanani

Rubbers has dealers in all states. The company do supply its product based on

agreement.

The Fig. 13 explains the sales technique of Hanani Rubbers.

33

Sales Technique Adopted by Hanani Rubbers

Fig. 13

In the figure the sales technique of the company is shown. After placing the order

for the product, the raw material is converted into finished products. On completion

of the product, the product is being despatch according to the orders from the

customers.

Sales Forecasting

Major forecasting is done at production meeting held at every month. The members

include production engineers, factory managers, supervisors, sales personnel’s etc.

The company products are seasonal in nature. So seasonal forecasting is also

conducted along with the meeting. Forecasting is conducted in monthly, quarterly,

yearly, basis.

Sales Promotion Policies

1. Right quality product, right price, right time deliver

2. The executives makes periodical visit to the dealers and agents on their

arrival to the head office.

3. Meetings and seminar are conducted occasionally and proper sales analysis

is made for promotion.

4. The company safeguards the customer’s interest and keeps a very strong

relationship with them.

5. The sales executives make a visit to the agents and people, to provide all

kind of assistance.

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Sales Order

Finished Product

Despatch The Product

Customers

5.7 HUMAN RESOURCE DEPARTMENT

Human Resource management is the function performed in organizations that

facilitates the most effective use of people (employees) to achieve organizational

and individual goals. Human Resource management encompasses those activities

designed to provide for and coordinate the human resources of an organisation.

Personnel management is the specialized branch of management that deals with

people in any organization, and it is directly concerned with the company’s welfare

and performance of persons who are a part of the operation. When an individual or

a team of individuals takes on this task of setting of programs and policies that

impact everyone associated with the company, they are engaged in the process of

personnel management, sometimes referred to as human resources management.

The function of a personnel manager usually begins with the staffing process.

Someone has to focus on screening and interviewing persons, with an eye to placing

individuals with the right skill sets in the right position within the company. Along

with placement, the HR manager also oversee or at least be involved in the creation

of entry level training programs, as the company continue education opportunities

for existing employees.

Determining company policies and procedures as they relate to personnel is another

important aspect of the personnel management process. HR functions often include

drafting vacation, sick leave, and bereavement policies that apply to all employees

of the company. The personnel management team often is also responsible for

managing the health care program provided to the employees in the company.

The structure of human resource department is given in Fig. 14

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Structure of Human Resource Department

Fig. 14

Fig. 14 explains the structure of the Human Resource Department. The Managing Partner heads the Human Resource Department. The Managing Partner is followed by the Director. Manager Personnel In-charge assists the Director. The Factory Manager comes below the Manager Personnel In-charge and Manager Accounts & Administration below the Factory Manager.

Functions of Personnel Department

1. Recruitment

2. Maintenance of personnel files

3. Time keeping

4. Selection

5. Management development

6. Organisation change & organisation development

7. Job analysis

8. Human resources planning

9. Wages and salaries administration

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Director

Manager Personnel In-

charge

Factory Manager

Manager Accounts & Administration

10. Training

11. Introduction & orientation

12. Performance appraisal

13. Career planning & development

14. Develop a maintain quality of work life

Wages

Daily wages are given to the workers. They are provided according to rules framed

Board of Directors. Wages is provided by adding basic pay with dearness

allowance.

Other Benefits

The other benefits provide by the company are as follows:

1. Medical aids

2. Loans

3. Night Bata

4. Overtime allowances

5. Production incentives

6. Insurance

7. Medical allowance leave with wages& Provident fund

Time and Attendance

Strict policy is followed by Hanani Rubbers regarding the attendance and timing.

1. Attendance card - it is meant for the workers.

2. Attendance register - it is maintained for the office staff.

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Health and Safety

Following are the safety measures done by the company as per safety precaution act

1. All type of safety cover for rotations pasts

2. Break system for machinery

3. Safety belt for above three meters

4. Pressure vessels safety certificate given by the factory inspector

5. Fire fighting equipment

6. Environment safety

7. All kind of electrical safety

Job Rotation & Job Schedule

The rotation and job schedule are favourably done for the both office staff and

workers. Factory manager does job rotation and job schedule for the workers.

Trade Union

The trade union is operating in the company is CITU, INTUC, BMS. Agreement is

made between Hanani Rubbers and the union members. It includes bonus wages

and other allowances.

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To analyse the functional performance of Hanani Rubbers, Porter’s Five Force

Analysis and SWOT analysis is made.

Porter’s Five Force Analysis

Porter's Five Forces is a framework for industry analysis and business strategy

development formed by Michael E. Porter. It draws upon Industrial Organization

(IO) economics to derive five forces that determine the competitive intensity and

therefore attractiveness of a market. Attractiveness in this context refers to the

overall industry profitability. Three of Porter's five forces refer to competition from

external sources. The remainder is internal threats.

Porter's five forces include - three forces from 'horizontal' competition: threat of

substitute products, the threat of established rivals, and the threat of new entrants;

and two forces from 'vertical' competition: the bargaining power of suppliers and

the bargaining power of customers.

(1) Threat of New Entrants

A growing industry often faces threat of new entrants that can alter the competitive

environment. There may however be a number of barriers to entry. Potential

competition tends to be high if the industry is profitable or critical.

In case of Hanani Rubbers, all the retail shops are the customers. Besides this, the

products are also exported to Sri Lanka, U.A.E, Netherlands, Germany and other

Middle East countries.

(2) Threat of Substitutes

The threat of substitution in an industry affects the competitive environment for the

firms in that industry and influences those firms’ ability to achieve profitability. The

availability of a substitution threat affects the profitability of an industry because

consumers can choose to purchase the substitute instead of the industry’s product.

The availability of close substitute products can make an industry more competitive

and decrease profit potential for the firms in the industry. In case of Hanani

Rubbers, the substitute product is synthetic rubber. Apart from the production of

mats, they also concentrate on the production of sandals in small scale.

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(3) Bargaining Power of Suppliers

If there are few suppliers and many buyers – supplier bargaining power is high. In

case of Hanani Rubbers, as there are many buyers and it is being exported, the

bargaining power of suppliers is very high.

(4) Bargaining Power of Buyers

The bargaining power of buyers of customers determines how much customer can

impose pressure on margins and volumes .Bargaining power of customers likely to

be high when the gaining power of the buyer is very high.

In case of Hanani Rubbers, the bargaining power of buyers is low.

(5) Rivalry Amoung Existing Competitors

Rivalry tends to intensify as the number of competitors increases and as they firms

become more equal in size and capability. Market rivalry is usually stronger when

demand for the product is growing slowly. The intensity of rivalry between

competitors in rubber industry is high and Hanani Rubbers has limitations for price

fixing. The main competitors of the company are Rubco Rubbers. Essgee Rubbers

& Melbin Enterprises, Vikas rubbers, Angel Rubbers, Dolphin Rubbers, T.J.P

Rubbers and Sharon Rubbers .

Swot Analysis

Setting the objective should be done after the SWOT analysis has been performed. This would allow achievable goals or objectives to be set for the organization.

Strengths: characteristics of the business, or project team that give it an advantage over others

Weaknesses (or Limitations): are characteristics that place the team at a disadvantage relative to others

Opportunities: external chances to improve performance (e.g. make greater profits) in the environment

Threats: external elements in the environment that could cause trouble for the business or project

Identification of SWOTs is essential because subsequent steps in the process of planning for achievement of the selected objective may be derived from the SWOTs.

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Strength

The strength of the company includes the following:

1. Good brand image

2. Production of Quality products

3. Fully automated production system

4. Well planned and controlled distribution network

5. Availability of skilled workers

6. Highly satisfied customers

7. Availability of highly qualified Employees

8. Good labour relations

Weakness

The weakness of the company includes the following:

1. Heavy work load for employees and labours

2. Insufficient promotion activities

3. Lack of delegation of authority

4. Lack of support from the government agencies

5. High amount of wastage

Opportunities

The following opportunities were identified for the company:

1. Opportunity in increasing production by fully utilizing plant capacity.

2. Scope for producing diverse products

3. Potential for setting branch network

4. Potential for widening the market both national and international

5. Scope for tie-ups with other firms

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Threats

The following are threats of the company:

1. Acute competition in the market

2. Large scale turnover of labourers

3. Rise in price of raw materials

4. Price of Artificial rubber is less than the Natural Rubber

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Findings

The following are the findings derived from the study:

1. 90% of the total rubber production in India is accounted by the state of

Kerala.

2. Shortage of skilled labours is a major problem of rubber cultivators in

Kerala.

3. Annualized global rubber consumption reached 25.8 million metric tons by

the end of the third quarter of 2011, 6 percent higher than at the same point

in 2010.

4. The Indian rubber industry has a turnover of Rs 12000 crores.

5. India is importing around 50,000 tons of rubber annually.

6. The net profit ratio of the company has shown a decrease of 0.59 percent in

2007-08 to 0.23 percent in 2011-2012.

7. Seventy percent of the total rubber production in India is in the form of

Ribbed Smoked Sheets (RSS).

8. India’s production varies from 6 and 7 lakhs tons annually which amount to

Rs. 3000 crores.

9. The rubber plantation sector in India produces over 630 hundred thousand

tonnes of natural rubber.

10. The per capita consumption of rubber in India is only 800 grams

compared to 12 to 14 kilos in Japan, USA and Europe.

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11. There are 7 major departments of the company comprising of

Administrative Department, Production Department, Finance Department,

Purchase Department, Marketing Department, Sales Department and Human

Resource Department.

12. Good brand image, production of Quality products, availability of highly

qualified Employees etc. are the strength of the company.

13. Heavy work load for employees and labours, insufficient promotion

activities, lack of delegation of authority etc. are the weaknesses of the

company.

14. Opportunity in increasing production by fully utilizing plant capacity, scope

for producing diverse products, potential for widening the market both

national and international etc. are the opportunities of the company.

15. Acute competition in the market, large scale turnover of labourers, price of

artificial rubber is less than the Natural Rubber etc. are threats of the

company.

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Conclusion

Hanani Rubbers started as a small rubber mat unit in Poovanthuruthu,

Kottayam district in 1981 has now expanded its activities and became one of the

major leaders in the rubber market. Maintaining the consistency in quality and

services is the main aim of the company. Hanani Rubbers is now India’s popular

brand of rubber mat having more than 400 tonnes of sales per year. The dynamic

leadership and innovative ideas made Hanani Rubbers as one of the leading

manufacturers of rubber mat products in India.

Hanani Rubbers, ISO 9001: 2008 certified company is having all the plant

facilities and a number of permanent satisfied clients over a period of time. The

company is competent enough because of its product quality and timely dispatch to

the requirement.

The study came to the conclusion that there exist a good system of

management and administration in the company, the employer – employee

relationship is better, the products has good market potential and the company has

good potential for widening its activities so as to satisfy the requirements of

national and international markets.

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Suggestions

1. Steps may be taken by the management to control the waste in the

production process.

2. Policies decisions may be taken by the management to organize orientation

and refresher training programmes for the employees at periodical intervals.

3. Initiatives may be taken by the management to institute aggressive sales

promotional activities.

4. Policies initiatives may be taken by the management to institute

collaboration agreements with international market leaders.

5. Discussion may be made with trade union leaders & frame policies

regarding workload, safety arrangements, recreation facilities etc for the

employees and labourers.

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BIBLIOGRAPHY

REPORTS:

Annual Accounts and Reports of the company

Reports of Rubber Board

BOOKS:

Evertte E Adam and Ronald J Ebert, Production and Operation Management, Konar Publications Pvt Ltd, Delhi, 2008

K Aswathappa, Human Resource Management, Tata McGraw Hill Publications, New Delhi, 2010

Philip Kotler, Marketing Management, Prentice Hall, Delhi, 1999

Prasana Chandra, Fundamentals of Financial Management, TataMcGraw Hill Publications, New Delhi, 2005

Suri. R K, Verma Sanjiv,” Organizational Behavior- Text and Cases”, .

. Wisdom publications, Delhi, 2005

Chhabra T. N, “Human Resource Management Concepts and Issues”,

Dhanpat Rai & Co, Delhi, 2008

V.S.Ramaswamy and S.Namakumary, Marketing Management, Macmillan

Business Books-2004

JOURNALS & MAGAZINES:

Rubber International Magazine, Vol 14, No. 11

Rubber Asia, Vol 9, No. 7

WEBSITE

www.hananirubbers.com

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