organizational study at western india plywoods

8/18/2019 Organizational study at western india plywoods

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Introduction

Introduction to Study

An Organization refers to consciously coordinated social unit composed of two or more

people that functions on relatively continuous basis to achieve a goal.

Organization 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.

The wood industry is one of the industries with great potential and it is mainly concerned

with furniture, plywood, hardboard, decorative wood, densified laminates, wood floorings,

Building material, material for interior decoration, ship building, automobile

manufacturing, and refrigerator etc.

The Western India Plywoods is one of the pioneers in Plywood and Hardboard Industries

in India. They have increased their product range from plywoods to all kinds of wood

products. The products of WIP are high in demand since their inception, and it is all due to

the stringent quality controls and reputation in the market. The purpose of the study is to

get an exposure about the industry and its functioning and to know how it feels to be a part

of an organization.

Scope of the study

This study is aimed at understanding the functioning of different departments of the

organization. It provides a better understanding about each functional department of the

organization and how they cooperate and coordinate with other departments to achieve the

organizational goals. To obtain information regarding strength, weakness, opportunity and

threats of the organization and to gather information about the market position and

financial position as well as the employees opinion about the organization. The study is

limited to ten departments of the organization and to the details that could be collected

during the period of study.


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Objective of the Study

To know about the basic functioning of an organization.

To get practical and theoretical knowledge about various departments of an

organization.

To study about the organizational culture and its influence on employees.

To learn about the mission, vision, policies and procedures of the organization.

To understand the strength, weakness, opportunity and threats of the organization.

To study the relationship between management, employees and customers.

Methodology

The methodology of study involves collection of data through primary and secondary

sources and analysis of activities of individuals by the means of constant observation and

enquiry. This task was carried out by building formal and informal relationship with the

staff members of the organization.

Primary Data. Data was collected through formal and informal discussion and

exchange of views with the company officials and employees. Technical data was collected

from the technicians and supervisors of the respective domains.

Secondary Data. The sources of secondary data are annual reports, qualitymanuals, periodicals, Company Newsletters, Organizational documents and Internet.

Limitations of the Study

The information collected was mainly from the employees under their busy schedule and

are subject to personal bias. Further much of the data required for the purpose of study

were drawn from secondary sources, so the project cannot be free from the defects of

secondary data. The data collected are subject to the limitations and are not available for

public scrutiny. It was not possible to interview the top officials of the firm due to their

busy schedules and this was a setback to the study because they are the people who have

an overall idea about the organization, their help could have improved the quality of

information. The time given was sufficient but if more time was given then it would be

helpful to blend in the organization and feel the organization culture.


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CHAPTER -TWO

ANALYSIS OF BUSINESSENVIRONMENT


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Industry Profile and Analysis

Trees are the nature’s greatest gift to mankind. They provide us with shelter, fuel,

medicines, tools, timber and much more. Nature develops trees as a mother brings up

children, making each one a separate individual. It is an amazing sight to see the natural

abstract rhythm of line, colour and texture in wood. Nothing from nature indoors gives

such a long lasting enjoyment as the natural beauty of wood. Flowers fade, but the beauty

of decorative wood is enhanced by age.

Global Scenario . Competition is keen in the plywood industry. Plywood

manufacturers and exporters are suffering from decreasing profit margins. Many

companies strive to reduce their cost of production and increase efficiency. Some relocate

their manufacturing operations to other areas with lower operation cost, such as theChinese mainland. On the other hand, foreign manufacturers are taking steps to strengthen

their domestic production through product specialisation.

To stay globally competitive, Hong Kong plywood manufacturers strive to reduce costs,

initiate quality control, improve design concepts and capability, and upgrade management

skills and increase marketing and sales effectiveness. Many manufacturers have obtained

or are applying for ISO 9000/9002 certification.

Hong Kong's plywood makers also started to develop their own brands. Plywood

Manufacturers also become more careful about the choice of raw materials to meet

international standards, such as compliance with legal or other environmental requirements

in their target markets. China is the largest plywood exporter to many countries, including

the US and Japan. The total plywood exports of China exceeded US$6,683 million in 2002,

with the US being its largest market. Guangdong province is the major manufacturing

centre of plywood on the Chinese mainland. Apart from Hong Kong, manufacturers from

Taiwan and even the US have also set up production plants on the mainland. In China,

most of the production is on an OEM basis. China also offers a huge potential market for plywood maker


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Indian Scenario . The Indian plywood industry owes its origin to the development

of tea industry in the state of Assam, West Bengal, Kerala and the difficulty created by the

two World wars in the way of imports of tea chest plywood. Except for the setbacks

suffered in the post war period, the plywood sector was booming since 1947.

In 1947 India was a net importer of plywood, mainly tea chest plywood of approximately

Rs.2 crore per annum. During 1992 India manufactured 150 million sq. meters of plywood

types that earned approximately Rs.1000 crore. The industry has grown both in small-scale,

medium and large scale sector.

The plywood industry consumes about 15 million m3 timbers of primary and secondary

species. In fact the plywood industry has provided main outlet for the maximum utilization

of secondary species of timber there by making available contribution in the forest

economy. Later, the plywood industry aided for the development of farm forestry sector plantation, which benefits the ordinary farmers in the country.

Industry Analysis

Industry Key Players

Figure 1:

Top players in India

Adapted from http://www.sourcinghardware.net/shrd/industry_report.html

14% 8%

3.50%

1.50%

1%

1%

70%

Competitor Analysis

Greenply Centuryply Merino Archidply Uniply WIP Others


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CHAPTER-THREE

ORGANIZATIONAL ANALYSIS


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Organizational Analaysis

Overview of the Organization

Background and History . Western India Plywood Ltd, is the largest integrated

wood-processing complex in the country as well as in southern Asia. It was established in

1945 and it started manufacture of sawn timberland plywood on a modest scale with a few

indigenous and lend lease machinery. The founder of Western India Plywood was Mr. A.K

Kunhiman Haji, Later he handed over the company to his son in law Mr. A.K. Kaderkutty

Sahib. The Company made progress through the years and expanded to its present status.

The company grew over the next two decades into a well integrated wood processing unit

with finely tuned skill in new product development and manufacturing. WIP is an ISO

9001:2000 certified company.

Plywood manufacturing was stepped up steadily by addition of new machinery, mostly

imported. They also diversified from the production of the Tea-Chests and Commercial

plywood to manufacture of decorative plywood, block board, flush door, shuttering

plywood, and aircraft plywood etc. The company also installed its synthetic resin unit in

1959 with a capacity of 200 tonnes. The hard board manufactured by the company found

ready acceptance in the market so that the company decided on an expansion project in

1977 to increase the output of the hardboard to 24700 tons per year. The expansion projectwas completed in 1980. Recently in 1990, the company added pre finished hard board and

plywood to its impressive product range. A state of the art production line imported from

Italy utilizes technology from the market leaders in the field of U.V curable paints

TREFFERT of Germany. Process employed in plant is totally environment friendly and

does not involve any harmful emission.

The company is the first in the country to put up a plant for irradiating wood in

collaboration with Bhabha Atomic Research Centre, Mumbai in order to aggregate the low-

grade timber.


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Company Mission, Vision and Values

Vision . Continue to remain the best plywood panel corporation in India with agrowth in allied areas.

Mission

To provide utmost satisfaction to the the consumer through best quality andcustomer care.

To continuously upgrade the product through innovation and convergence of new

technology and to produce the best quality product.

To respect the dignity of all employees and together to become instrumental in the

development of the country while protecting the environment.

To utilizes the surpluses for the welfare of employees and the society at large.

To safeguard and enhance shareholders values.

Objective

To promote the quality of products.

To attain self reliance.

To serve the national economy.

To build the reputation of Western India Plywoods Ltd.

To maintain the brand loyalty of its customers.


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Compreg Slats Customised Densified Wood Used in Railway Coaches

Densified Moulded Densified Wood Used in Railway Coaches,

Moulded Seats Auditoriums & Restaurants etc.

WESTIND PLY BWR &BWP grade Used for boat building, Concrete

Plywood Shuttering, Furniture, Paneling etc

HARDBOARDS Wooden Board made from Extensively used in automobile

crushed wood Industry, furniture elements, Clock

frames, Photo frames etc

Adapted from 69 th Annual Report (2103-2014) of WIP

Product Mix

Figure 2Pie Chart representation of product mix


57.07%18.06%

17.92%

2.45%

2%2.06%

Product Mix

Hardboard Plywood Compreg

PreCompressed Board PFB Furniture

Other Miscellaneous Sales


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WIP’s list of first in the country

First to make irradiated wood.

First to make aircraft plywood.

First to make synthetic resin adhesive bonded plywood using hot pressingtechniques.

First to make high pressure industrial laminates.

First to make quality hardboard way back in 1959-60.

First to manufacture Di Ally phthalate moulding powder.

First to manufacture GI – Plywood-GI sandwich panel for anechoic chamber.

First to make prefinished Plywood’s and hardboards using UV cured surfacefinishing techniques.

First to develop weather proof, marine and fire retardant hardboards.

First to get ISO 9000 certification for hardboard and prefinished boards.

The company has earned special appreciation from leading industries in theautomotive sector, Footwear sector, ISRO, BARC, Indian Railways etc.

Area of Operation

National

Kerala Karnataka

Tamilnadu

Andhra Pradesh

Maharashtra

Uttar Pradesh

Delhi

International

USA

EUROPE

AFRICA


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CHINA

JAPAN

KOREA

SRI LANKA

MIDDLE EAST

Awards, Recognitions and certifications

National Association for Applications of Radio Isotopes and Radiations inIndustry (NAARI) Award -1984

Chemical and Allied Products Export Promotion Council India(CAPEXIL)Awards:

o CAPEXIL Special Export Award 1975-76.

o CAPEXIL Certificate of Merit 1976-77.


o CAPEXIL Special Export Report 1982-84.



o CAPEXIL Certificate of Merit 1985-86.


o CAPEXIL Special Export Award 2002-03. ISO 9002 Certified Company for Hardboard & Prefinished Boards.

Business Performances . WIP is the fourth biggest plywood factory in Asia. The

factory is situated in Kannur district in Kerala state. WIP collects timber and firewood

through import from Malaysia, Africa, Burma, Russia etc. and local purchase. Thus it is

being processed at the factory and converted into various finished products such as

different varieties of plywood, hardboard, furniture, wood floor etc. WIP exports 80% of

total production to Germany, USA, Canada, Italy, Australia, Japan, Sweden, Papua New

Guinea Middle East and Gulf Countries regularly.

The rest of 20% is being through retail outlets and Company’s sales depots throughout

the country WIP Ltd., the largest integrated wood processing complex in the country, was

incorporated in 1945 immediately after second world war.


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The company has three divisions mainly i.e Hardboard, Plywood and Furniture divisions

with an employee strength of 1300 including 87 office staff members. Now the company

is one the leading in plywood and Hardboard industries in India and is supplying to

international market also.

Hardboard. A Hardboard plant with an installed capacity of 12.5 tons was set up

in 1959- 60 with West German technical collaboration. Today WIP’s hardboard division is

the market leader in hardboards with state of the art production lines manufacturing over

120 tones today. WIP’s hardboard like its plywood products, commands a premium in the

market, due to its intrinsic quality which is recognized by loyal customers.

The product range of Hardboards include

o Standard Hardboard

o Oil Tempered Hardboard

o Perforated Hardboard

Plywood. Plywood is the first type of engineered multipurpose wood form that was

invented. It is made from slices of wood shots called as veneer or piles. The veneer layers

are starched together and pressed under strong adhesives and heat. Plywood is preferred

over ordinary wood because it having good stability and good resistance to change.

Strategic plans and Future Programmes . WIP has a built a reputation and

goodwill in the market which they are striving hard to maintain it .They are constantly

satisfying the customer needs and satisfaction through constant improvement in quality of

products and by doing in house Research and Development to ensure 100% utilization of

wood.Here in WIP the Wood being the major raw material, they give utmost importanceto procurement of timber for the purpose of manufacture of plywood and Hardboard as

well as furniture. The company is looking forward to such Joint Ventures in the future as a

part of expansion and growth in international market.


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The Board of Directors are at the top level of the corporate structure where the long term

plans are formulated and policies are framed. They are followed by Managing Directors

and then by the various Departmental Heads. Each department is under the control of the

departmental heads and they are followed by the Managers & Executives.

Business and Departmental Structure . WIP has the following functional

departments for the ease of carrying out the business process.

Production Department

Human Resource Department

Finance Department

Purchase Department Export Import Department

Sales Department

Marketing Department

Timber Department

Central Excise Department

Research & Development Department

Stores Department

EDP Department


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Functional Analysis

Production Department

GENERAL MANAGER

PRODUCTION WORKS MANAGER MANAGER

SHIFT IN CHARGE

SUPERVISOR

OPERATOR

WORKER

Figure 4:Production Departmental structure

Adapted from Primary Source


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Production involves conversion of rawmaterial into finished products/goods.It can briefly

explained as follows

Input Conversion process Output

In WIP the raw material that are used to the output is steam,wood,chemichals. After

introducing these raw materials to a series of process the finished goods are obtained.The

wood that is required for production is acquired from both local as well as international

markets.The company is mainly having 5 major plants to produce 5 different products.

They are Hardboard, Plywood, Compreg, Furniture and Precompressed boards.

Raw Materials . The major raw materials used by the company are Wood, Steam

and Chemicals. Wood constitutes the majority of the raw material consumed.Wood. Wood is mainly imported by WIP from Malaysia, South Africa, Sweden,

Myanmar and other South Asian countries. The woods used for general purpose are

Kalpine, Mango, Panda Pine, Eucalyptus, White Cedar, Neeli, Swiss Pine, Kussia, Pali,

Beech etc. For furniture use Teak, Rosewood, Mahogany, Pad Oak etc are used.

Steam. Steam energy is used to operate the machines. They are generated in huge

boilers and supplied through pipelines to different manufacturing plants inside the

company. Boilers need fuel to produce steam and based on this the boilers are classified as

follows:

Saw Dust Boiler

Fire Wood Boiler

Agricultural Boiler

Fuel Bed Combustion Boiler

Chemicals Various chemicals and substitutes are used for manufacturing of plywood,

Hardboards etc.Some of them are Formaldehyde, Acrylate, Phenol Formaldehyde etc.


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Plywood. Plywood is made up of piles of wood wafers stacked together and glued.These layers

of wood are known as veneers. They can be bent to any shape.

Production process of Plywood.

LOGYARD

CROSS CUTTING

BOILING

PEELING

CLIPPER

GLUING

FREEPRESS & HOTPRESS

TRIMMING & SANDING

FINISHING

Figure 5

Plywood production process

Adapted from Organization manual (2013-2014) prepared by Chief General Manager


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Logyard . It is the area where the Wooden logs are kept. In WIP’s log yard consists

of a part of Valapattanam River and the logs are allowed to be soaked in water. It is actually

what we call as a warehouse of a company.

Cross Cutting. The Wood is transported from the logyard to the Cross Cutting

section for cutting into pieces using a chain saw and making it in sizes of 3 to 8 ft.

Boiling . Timber being a hardwood, in order to make it soft and easy to cut it is

boiled in hot water using pressurized steam at 80-160 0centigrade.

Peeling. The boiled logs are put into the peeling machine and peeled. There are two

types of peeling machines in the plant, they are spindle peeler and spindle less peeler.

Spindle less peeler is used to peel further what is left over by the spindled peeler. The

peeled log wafers are called as veneers.

Clipper . The veneers are put into clippers and cut into sizes of 3 to 8 ft. There are

two types of clippers, i.e. wet and dry clippers. Wet clippers are used for cutting hard logs

which were boiled. Dry clippers are used to cut the dry veneers.

Gluing. Gluing is the process of pasting the core veneer with adhesives on both

sides and sticking it to the face veneer in opposite right angled directions. The glue roller

machine is used to spread the adhesives.

Free press and Hot press. In Free Press the wooden board is compressed under

pressure without any temperature. In Hot Press the board is compressed at high temperature

of 140 to 2000 centigrade and 270k pressure.

Trimming & Sanding. Trimming is the process of cutting the edges to shape the

plywood and straighten the edge. Circular saws are used for trimming. Sanding is the

process of smoothening the surface of plywood through a sanding machine.


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Finishing. Finishing is the process of beautifying the plywood and preparing it as a

finished product. The board is cleaned off damages and cracks and crevices are filled with

French powder.

Organization chart for Plywood

Figure6:

Organization Chart of plywood



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FREE PRESS

HOT PRESS

TRIMMING

FINISHING

Figure 7:

Production process of hardboard


Logyard. This is the place where the logs are stored and it acts as a warehouse for

the company.

Chipper. Chipping is the process of crushing large blocks of wooden logs into small

pieces of wood chips. The wooden logs are transported to the chipping machine using the

conveyer belt. WIP has two chippers for this purpose.

Washing. The chipped wood is washed to remove mud and sand and other

impurities. The chips are put into a wooden chamber and mixed with water thoroughly.

The sand and mud gets settled down due to gravity. After washing the chips alone fall into

Chip Silo.


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Chip Silo. In Chip Silo the washed wooden chips are stored temporarily. A screw

conveyor is fixed at the bottom of the conical tank for collecting the chips.

Preheater. Preheater is a tank that is used for heating the wooden chips in order to

soften the chips and drain excess water.

Defiberator. It is used to convert chips into fibrous form. This is done by grinding

and heating the chips.

Cyclone. Here the grounded chips are mixed with water in a conical tank to form a

paste like mixture. It is mixed uniformly to form a pulp like substance.

Defiberator Chest. The defiberator chest is used store the pulp temporarily and it is

sent to equalizer.

Equalizer. Here the pulp’s thickness is adjusted and made uniform in size and

passed to the machine chest.

Head Box. The head box spreads the pulp into uniform flat surface to form a

rectangular shape. This pulp is transported through the conveyor belt.

Board Forming. The board is formed when it is cut using pressurized water in a

specific shape. The edges and corners are also shaped. This process is automated and so its

precision in cutting is very high

.

Free press. Here the shaped substance is compressed using metal plates to remove

the excess of water in the pulp.

Hot press. Here the wooden sheet that comes from the free press is compress and

heated at a temperature of 200 o centigrade and 200kg/m 3 pressure. This is done for 3

consecutive periods for a single board. The hot press can be loaded with 13 boards at a


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time.

Trimming & Finishing. Trimming is the process of cutting the board in regular

dimensions or customer defined sizes. This is done with trimming machine fixed with a

pair of saws at both sides. The finished product is sent for quality check and clearance.

Organization Chart of Hardboard

Figure 8:

Organization chart of HardboardAdapted from Primary Source

MANAGING DIRECTOR

GENERAL MANAGER

MECHANICHALENGINEER

ELECTRICALENGINEER

CHEMIST

WORKERSWORKERSOPERATORS


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The annual installed capacity of the various products being manufactured by the company

is summarized below

Table 2:

Annual Installed capacity of products

Plywood (in million sqm of 3ply x 4mm basis) 2.5

Hardboard (in M Tonnes) 34000

Densified wood (in M Tonnes) 2000

Resins(in M Tonnes) 2400

Furniture(in units) 15810

Dialyl phthalate(in M Tonnes) 10

Glass Reinforced plastics( in M Tonnes) 800

Prefinished boards (in lakhs sq.m) 9.0

Pre – compressed press board(in M Tonnes) 660

U.V Top coat and Basecoat(in kgs) 82600

Adapted from Organization Manual (2013-2014) prepared by Chief General Manager

Specifications

IS 303: specification for plywood for general purpose(Boiling water resistant)

IS 303: specification for moisture resistant

IS 710: specification for Marine plywood

IS 709: specification for Aircraft plywood

IS 1328: specification for veneered decorative plywood

IS 5509 : specification for Fire retardant plywood

IS 4990 : specification of shuttering plywood


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Human Resource Department

Figure 9:

Human Resource Departmental StructureAdapted from Organization manual (2013-2014) prepared by Chief General Manager

WIP Ltd is having the best governed Human Resource Department which is the heart and

soul behind the success of gigantic estabilishment.General Manager is the head of the

department followed by the factory executive who deals with all the matters in the personal

department.He is assisted by Personnel Officer and Welfare Officer.The time clerks deals

with the attendance leave and the time management of the workers in shifts and generalshifts.Besides there also provide people dealing with ESI,PF,Canteen token,wage and

salary administration and disciplinary action.


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Recruitment & Selection. In WIP the process of recruitment includes both internal

and external sources. Based on the vacancy or need for workforce manpower planning is

done. The internal sources include promotion, job rotation etc. External sources include

referral programme, campus selection, freshers and deputation. A panel of members

interviews the candidate and sends him/her for induction.

Training. One year training is given to the new entrance.Training is restricted not just

for a specific work but an overall training is given to workers so that they can fill in any

post of the absentee.This makes the worker more versatile.Stipend is given to the trainee

during the training periods.

Classification of Workers

Permanent Workers

Probationers

Substitutes

Temporary Workers

Casual Workers

Apprentice

Ticket or Attendance Card. Every workman shall be given a ticket or attendance

card free of cost showing his number or name,classification etc.Every workman shall

punch his attendance card at the punching machine and deliver up his card or ticket at the

place provided in the time office before commencement of each session of the shift in a

day.

Retirement. Any worker who is declared mentally unfit or found to continue ill health

or reach the age of 58 shall be retired from service according to Gratuity Act.


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Factory Timings. The factory runs for 24 hours and is not shutdown on any day. The

workers are allocated with three different shift timings for works. The timings are as

follows:

I shift 6:30 am to 2:30 pm II shift 2:30 pm to 10:30 pm

IIIshift 10:30 pm to 6:30 am

General shift 7:30 am to 4:00 pm

Office time 9:00 am to 5:00 pm

Since the work shifts can vary every time, most of the workers are local residents of

Valapattanam or Kannur District.

Disciplinary Action. Any employee found guilty of misconduct is liable to be

dismissed without notice or compensation in lieu of notice or alternatively to be suspended

for a period not exceeding 4 days or to be fixed up to 2% of his wages in accordance with

the provision of payment in Wages Act.

Leave & Holidays

The staff members are allowed for one leave for every 10 days of work. National and Festival leaves with wages will be allowed to workmen.

Leave for sickness, accident will be allowed to employees.

Wages. Factory workers are given with weekly wages whereas the office staff and

permanent workers get monthly salary. The administrative department draws monthly

salary which is credited to their bank accounts.

Welfare Measures

Employees Provident Fund. This act is applicable to those employees whose

drawing pay not exceeding `6500 /month. This act is applied to every factory in 20 or

more workers are employed.12% of employee’s wages and an equal of employer’s


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contribution is transferred to the EPF.

Employees State Insurance Scheme . The company follows ESI Act 1948. This act

provides medical benefits to the employees in case of sickness or accident during work. At

present the coverage of this scheme is restricted to employees not drawing wages not

exceeding `7500/ month. This may include salary, DA and HRA. The employee contributes

1.75% of the usage and 4.75% of the wage is contributed by the employer.

Canteen Facility. WIP runs a canteen where food is available at concessional rate

to the workers. Tokens have to be taken in advance for this facility.

Safety Provisions Walkway for movement of personnel

Masks and Protective covers

Mechanised Material Handling

Effluent Treatment as per KPSCB norms.

Saw dust absorbers

Proper lighting

Ambulance and First aid

Safety Day celebrations for awareness on March 4 th


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Finance Department

Figure 10:

Finance Departmental Structure


Finance department is one of the core departments of an organization. The General Manger

of Finance is head of the department. The Company secretary is also the Finance GM of

WIP. The company follows double entry system of accounting for recording the

transactions.The finance department has direct interaction with all other departments since

all the payments and collections are made through here.This department follows a written

form of communication.All department payments and receipt are finally reported to the

finance department

GM FINANCE

ACCOUNT MANAGER

ASSISTANT A/C

MANAGER

ASSISTANT A/C

MANAGER

ASSISTANT A/C

MANAGER

ACCOUNTSTAFF

ACCOUNTSTAFF

ACCOUNTSTAFF


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The following accounts are maintained by WIP

Journal

Ledger

Sub Ledger

The following records are maintained by WIP in finance department

Total Debtor Account

Total Creditor Account

Purchase Day Book

Sales Day Book

WIP publishes annual report every year after the annual general meeting which is attended

by the board of directors and major share holders. It includes P&L account, Balance Sheet,

Accounting Policies of the business, Consolidated Cash Flow Statement etc.

Sources of Finance

Shares

Reserves & Surpluses

Secured Loans Unsecured Loans

The company maintains the following types of journals

Cash payment book (CPB)

Bank payment book (BPB)

Cash receipt book (CRB)

Bank receipt book (BRB)


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For these types of journals sub ledgers are maintained, they are as follows:

Accounts receivable book

Accounts payable book

Personnel ledger

Sources of Fund. The main sources of funds are

Internal sources. The main internal sources to fund WIP are income generated from

sales. Reserves are the sources of fund other than income from sales. Current losses are

adjusted by these reserves.

External sources. The main external source of fund is term loan form bank and financialinstitutions like SBI, Canara Bank, Punjab National Bank etc.

Bankers . The main bankers of WIP are

State Bank of India

Canara Bank

Indian Overseas Bank

Bank of India

Dena Bank

State Bank of Travancore

Urban Bank of India

Other functions of Finance department are issue of cash & cheque, cheque receipt, auditfinalization, wages and salary and banking related tasks.


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Revenue Distribution

Figure 11:

Pie Chart Representation of Revenue Distribution


Share Holding Pattern

Figure 12:

Pie Chart Representation Share Holding Pattern


46%

14%

4%

5%

10% 1%

Revenue Distribution

Material Consumption Employee Benefits Finance Charges

Depreciation Other Expenses Profit

46%41%

12%

1%Shareholding Pattern

Public Promoters Financial Institutions BodiesCorporate


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2) Quick ratio = Quick asset/Current Liability

Quick asset = Total Current Asset - Inventory

= 613389177 - 381284311

Quick Asset= 232104866Cr

3) Total current liability = 139620950Cr

Quick ratio = Quick Asset/Current Liability

=232104866/139620950

Quick Ratio= 1.66

An ideal quick ratio is 1:1.In 2014 quick ratio is 1.66


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Purchase Department

Figure 13 :

Purchase Departmental StructureAdapted from Organization manual (2013-2014) prepared by Chief General Manager

The Western India Ltd has well developed and efficient purchase department,which is deals

with the purchasing of raw materials.Company usually makes three kinds of purchasing:

Local Purchase

Direct Purchase

Purchase through bank

Company has broadly classified its purchase department into Timber purchase department

and all other purchase departments.Other department does the buying of all other items

other than wood i.e timber.It is involved in purchasing of consumer

MANAGINGDEPARTMENT

GENERAL MANAGER

PURCHASE MANAGER

PURCHASE STAFFPURCHASE STAFF


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product,spares,oils,acids,chemichals and other ancillary raw material used for

manufacturing its products.

Timber purchasing department dals only with the purchase of Timber.Timbers are

purchased through bank or direct purchasing.An intend will be received from the stores

department about the item to be purchased.The production manager should sign it.An

enquiry will be made and following that the quotation will receive.Suitable quotations will

be selected and it will be sent to the production department mentoning the criteria of

selection.After receiving the quotation the purchase department will make order with

specified conditions.If the goods are sending through bank intimation will receive from the

bank that the goods are ready for delivery.The money is paid as per terms and conditions

and the goods are delivered .In the case of direct purchasing money is directly paid to thesupplier and the goods are received

Purchase Procedure. Invites for quotation from various parties.From the quotation the

actual buyer will be identified based on price and quality.Order for the goods.Goods will

be sent to the nearest parcel offices from there the customer company will collect the

consignment.Documentation through bank or direct supplier.Sometime advance payment

is also undertaken.Emergency purchases can be authorized by MD/ED by passing the

above step.


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Export & Import Department

MANAGING DIRECTOR

GENERAL MANAGER

EXPORT/IMPORTEXECUTIVE

EXPORT/IMPORTASSISTANTS

CLERKS/TRAINEES

Figure 14:Export & Import Departmental Structure


The Export & Import department of WIP deals with export of finished goods to overseas

and import of raw materials (timber) from other countries.Export dealing is coming

directly under the managing director and import dealings are controlled by the general

manager .Export and import executives carry out functioning of thr department and they

are assisted by assistants.

EXPORT


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Nearly 30% of the sales is from exports, WIP exports Hardboard to Australia, U.A.E,

New Zealand, Malaysia, Tanzania, Papua New Guinea, U.S.A, Europe and other Gulf

Countries.

Export Procedure

Proforma Invoice

Pre Shipment documents

Invoice preparation

Packing List

Bill of lading

Quality certificates

Post Shipment documents

Import WIP imports Timber, veneers and machines from countries like Malaysia,

Myanmar, France, Ecuador, Sweden, Italy, Kenya, U.S.A etc.

Import Procedure

Enquiries

Request for Proforma Invoice Selection of suppliers

Placing the Order

Clearance Procedure


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Sales Department

Figure 15:

Sales Departmental Structure


Western India Plywoods markets their products through agencies and depots.They use

sales representatives also,Their main promotion method is direct contact by sales

representatives to canvas govt. and railway.Enquiries are made through tenders.The main

tool used to catch government order is by the lowest quotation.

The Western India Plywood Ltd provides both cash as well as credit sales.The credit period

allowed is usually 30 days.The sales depots are run both by company as well as by some

external agencies.There were more than 40 depots in India of which 14 are in Kerala.Each

depot is handed and controlled by depot manager

ype Of Sales

Industrial sale

Export sale

Local or domestic sale

GENERAL MANAGER

SALES MANAGER

SALES STAFF DESPATCH


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The main industrial customer of this company are Indian railway,HMT,KSRTC,shipyard

etc.ProductsaremainlyexportedtocountrieslikeUSA,Netherlands,France,Srilanka,Japan

and Canada.

Methods of Sales

Depot System. WIP uses depot system in distribution showing its wide range of

market potentially.Each depot is headed and controlled by a depot manager and one or two

assistance assist him.

Manufacture Agent Industrial buyers

Direct Sales. The company sells directly to consumer.The major way of direct

marketing is e-mail,post and leadership.

Manufacture Industrial buyers

Dealership System. Approved stockiest or dealers purchase the goods and sell in

the retail market.

Process. Sales starts when the orders are received from the customers, they are sent

to the factory stating the requirement of the goods. The order is processed and

manufactured according to the specifications. The customer receives intimation when the

product is ready for delivery. Company allows credit sales to its loyal customers who have

been doing business with WIP from time to time.


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Figure 16:

Sales of last four years


In the year 2013-14 WIP made a turnover of 103 Crores.Excise Duty is 12.5%.Central

sales tax for registered is 2%.While for unregistered is 14.5%

90

92

94

96

98

100

102

104

2013-14 2012-13 2011-12 2010-11

Sales(Rs in Crores)

Sales(Rs in Crores)


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Marketing Department

Figure 17:

Marketing Departmental Structure


As we know that marketing is one of the important functions of any business organization.

WIP has a marketing department which most dynamic among other departments. The goal

of marketing is to satisfy the customer needs with profitability. Marketing department is

well established and marketing is done for its high quality products.The company targets both high income and low income group. Apart from that they also

target retail and wholesale buyers of their products. The name and goodwill of the company

is far enough to market the products of WIP. The company’s reputation plays an important

role in marketing strategy of WIP.

MARKETING

MANAGER

MARKETINGCOORDINATOR

MARKETINGOFFICER

BUSINESSDEVELOPMENT

OFFICER

MARKETINGEXECUTIVE

REPRESENTATIVE


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Marketing Strategy. WIP is producing high quality goods with international

and/or national standards.So the company cannot compromise to the price factor.They

follow ‘High Quality,High Cost,High Price’ marketing.The company is aiming at quality

conscious customers and is not ready to compete with local manufactures.

WIP’s marketing strategy is ‘Niche Marketing.Under this marketing strategy company

offers technologically superior products and where quality is the determining criterion.The

company is not entertaining any short term promotion schemes.Long term brand building

is undertaken through promotional tools.

Market Segmentation. The company believes in quality and standard. So WIP’s

products undergo stringent quality tests. The prices of WIP’s products are comparatively

high since there is no compromise on quality. WIP is marketing more than 300 products.

The market is segmented follows:

Domestic Market

Industrial Market

Export Market

Export Market

Australia

Sri Lanka

U.S.A

U.A.E

Malaysia

Burma

African Countries

Europe


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Industrial Market

Car Manufacturers

Clock Manufacturers

Railways

Other Major Industries

Local Market. These include local customers who purchase plywood or Hardboard for

ceiling separation, door separation and furniture.

Positioning. The WIP Ltd has positioned its brand in the upper and in the market target

those segment which requires or desire the quality offers backed by willingness to pay for

it.The WIP Ltd commitment to niches the latest technologies in the field of wood

processing and continuously upgraded its process and machinery.

Product Branding And Loyalty. WIP Ltd is a reputed company in producing wood

based products.The company is try ing to use this ‘goodwill’ in marketing their

products.They are not trying to sell their products using their brands and brand loyalty.WIP

has given WESTINED for their plywoods,furniture and for decorative floorings.The

company’s hardboard is branded as ‘WESTON’.The Densified wood and prefinished boards are individually branded.Most of the customers are showing company loyalty as

company is having very good image in their minds.

Marketing Mix

Product. WIP’s Hardboard has super mechanical and physical properties. WIP’s

Hardboards are exported worldwide. WIP’s plywood is also having good sales over the

market since they produce since they produce boiling water proof, boiling water resistant,

fire retardant plywood, aircraft grade plywood etc.

Pricing. As said earlier WIP’s products are more expensive than their competitors due

to their state of art technology and unmatched quality. They are sold through exclusive

retail outlets all over the country. The customers are retained due to their brand loyalty


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since the product is of good quality.

Place. WIP has 27 exclusive retail outlets all over India for the sale of their products,

which are either owned by the company or commission agents. The hardboard is sold

through leading dealers in the country since they are products of mass consumption

Promotion. WIP concentrates on long term promotional activities. Brand building is

done through personnel selling and direct mail marketing. It has a public relations

department for promotional activities. It also conducts and participates in Exhibitions and

Trade Fair etc to attract potential customers.


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Timber Department

GENERAL MANAGER

PUBLIC RELATION

CLERKS

Figure 18:

Timber Departmental Structure

Adapted from PrimarySource

Timber department procures the wood required for production which is the main raw

material of the company. The raw material procured is used for plywood, hardboard and

compreg production.

Sources of Timber are :

Private Sources. Timber is sourced from private parties if the quality of the timber

is good and the price is reasonable. The company negotiate with the parties and fix the

price according to the market value

Government Source. The Forest department puts forward the wood for quotation

every year. The company can collect the wood after acquiring the order. There is scarcity

in the Government sources recently.


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Import Sources. Recently WIP has started a Joint Venture in Malaysia for import

of timber and other quality raw materials. About 80% of the wood is sourced from imports.

Timber is mainly imported from countries like Myanmar, Sri Lanka, Germany, Africa,

Europe and Kenya etc.Different types of wood imported are vellapine

wood,beech,Redcede,kalpine,keruing,kussin,Paliwood.


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Documents Maintained

A copy of personal ledger accounts with records and details of payments

Central credit account

ER-1(Excise Return) CR-6(Chelan Receipts)


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Research & Development Department

Figure 20:

R&D Departmental Structure


WIP has an in house R&D department which is found rarely in wood and allied industry.

This is an added advantage to the company. The R&D department works on plywood and

allied products in WIP. This department is recognized by Department of Science &

Technology of Government of India.

This approval is to be renewed every two years and has to present a future plan for the nexttwo years to be implemented and a detailed report the performance of the previous two

years.

GENERAL MANAGER

HEAD R&D

EXECUTIVES QUALITY CONTROL

CHEMIST TECHNICIAN CHEMIST TECHNICIAN


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The department undertakes projects on resin development, plywood development and

prefinished boards. Some of the developments of R&D department are

Water based UV curing paint

12KV/mm insulation based on precompressed board

Wooden based compost

Bricket made of by products for Furnace Oil

The R&D department is allowed with tax benefits for the raw materials consumed and it

can source the raw materials in subsidised rates from Government of India. The recent

development was on Diethyl Phthalate, Resin based Glues and Sheet Moulding

components which are prominently used in electronic compound industry. The DAP

moulding compound was first manufactured in India by WIP by their state of the art

technology. This is an import substitution now used.

Differrent types of testing done on R&D department are

Density test

Glucious test

Modulus of fracture

Modulus of elasticity

Tensile strength Compressive strength

Block sheer strength.

Thickness swelling test

Smoke density test

Toxicity test

Vertical impact test


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Stores Department

GENERAL MANAGER

STORE OFFICER

STORE KEEPER

STORE HELPER

Figure 21:

Stores Departmental Structure


The Stores department is responsible for stocking of the tools, spares, necessary raw

material and other components.

It is headed by the General Manager, followed by the Store Officer and Store Keeper.

The Store Keeper is assisted by the Store helper.


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The Stores department maintains the following documents

Store Identification Label

Positive Recall Slip

Goods Rejection Note

Store Indent

Goods Inward Note

The goods ordered are delivered at the store house by the supplier. The store keeper keeps

a record of these items and stocks them at the store house.

The inspection department verifies whether the purchase goods are in accordance with the

purchase order.

The inspection department collects information such as quantity inspected, quantity

purchased, quantity rejected and the reason for rejection. The indents are signed by the

Works Manager and Store Keeper. The WIP store is well stacked and ordered to get ISO

9002 certified in 1996. It is bound to inspection for every 6 months.


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EDP Department

GENERAL MANAGER

EDP

CLERKS

Figure 22:

EDP Departmental Structure


The EDP department deals with the computer systems and network of the company. Thisis a small section in WIP and not a fully utilized or developed department. The company

office is LAN connected to each system but it is restricted to internet access, only few

systems are internet accessible. The EDP department prepares and edits

WIP’s monthly newsletter named “WOODTALK”.

The company doesn’t have its own technician for hardware maintenance. The maintenance

is outsourced to an external party. The EDP department takes care of the travel

arrangements for the organization heads and officials for official meeting and outstation

trips.


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Organizational Analysis

Key Resources

The key resources of the company include a vast pool of human resource and a state of art

technology and imported quality wood. They launch high quality products in the marketthrough constant innovation and persistent hard work. The company employs 1300

employees, which shows that a huge workforce is working for the improvement and

development of the company. WIP is highly dependent on good quality timber for

production of quality products, which they either import or source locally.

Swot Analysis. . SWOT analysis is an important aid for the management when it

comes to making critical decision. SWOT is an acronym for Strengths, Weakness,

Opportunities and Threats. The strengths and opportunities represent the positive aspectswhereas the weakness and threats represents the negative aspects that the company should

try to overcome. Strength and Weaknesses are internal to the organization. It is related to

the strategies implemented by the Organization, its position in relation to competitors etc.

Generally these parts are controllable whereas Opportunities and Threats are external to

the organization, which are caused by the external environment.

The aim of conducting a SWOT analysis is to isolate the key issues which would

be important in the future for the organization. Every successful firm’s success comes up

when they implement the outcomes of the SWOT analysis in the best possible manner

Strength . WIP is the one of the largest plywood manufacturing company in South

East Asia.They have stringent quality control techniques. The company is one of the very

few hardboard producing industries in India. The company has a well established in house

R&D, one of the best in industry. Installation and Licensed capacity is very high, so that it

can increase its production if needed. The company has an operational experience of 65years with dedicated workforce. WIP has larger dealer network in India for plywood and

hardboard sales.

Weakness . The company experiences an acute shortage of good raw material which has

forced the company to import good quality timber. As the raw materials are imported the


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company experiences high cost of production leading to low profit. Promotional activities

are insufficient to boost up the sales as the promotional activities of competitors are better

than that of WIPThe prices of the goods are high compared to its competitors. Lack of good

distribution network as compared to competitors

Oppurtunities. The company has a vast area where the there is a scope for growth &

development. Wood products are high in demand hence there is always stable demand in

the market. The goodwill and reputation can help in further diversification. R&D

department can supplement the development of new products. Modernization and

automation can be carried out for better production and competitive growth

Threats. As timber is a scarce resource there is a shortage of good quality timber and itcan affect the company in the long run. High cost of production and increasing cost of

furnace oil can lead to lower growth of the company. Environmental threats have adversely

affected the company since wood is a natural resource. Imported plywood is available at

cheaper cost compared to WIP’s plywood.


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Observations & Conclusion

Observations . The company has performed well over past few decades and has got many

accolades for it. The company gets a major chunk of profits from export activities.

Company emphasizes of 100% utilization of wood and zero wastage as wood is a scarce

natural resource.

The company is not fully computerized and not MIS employed so every action is recorded

manually. The company uses imported high quality machineries but it is high time to

replace the same. The company is unable to meet the demand as the production is not

sufficient to satisfy the market demand. WIP concentrates on high quality products and

hence stringent quality checks are conducted.

Since the inception of the company in 1945, WIP has experienced a steady growth through

constant innovation and persistent hard work to build a reputation and goodwill among its

customers.Due to its integrated production technique WIP achieved 100% utilization of

wood which sets an example for other companies as wastage of natural resources is a crime

to mankind. The company doesn’t aim to compete with local players and doesn’t have any

target or deadline to achieve. These all achievements has come into existence due to

effective leadership of the authorities.

WIP has stepped into next millennium and is a pioneer is allied wood products in the

country. These all came into being due to the dynamic vision WIP’s founder and visionaryMr. A.K. Kaderkutty.

Conclusion . Western India Plywoods Ltd., the second largest wood processing industry in

South East Asia, therefore it has a bright future in this field. During the running period

since 1945, the company has achieved various milestones. The high-end production

technology of WIP is well acknowledged among the wood processing industries in India.

WIP Ltd. stands for superior product performance and provides value for money to its

customers. It is backed by WIP’s commitment to harness the latest technology in wood

processing industry and continuously upgrade its processes and machinery. Due to the high

quality maintained, the company has found a ready market both India and abroad. The

company has better future prospects in the country in Wood and allied products


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Aswathappa, K., SridharaBhata, K. (2005). Production and Operations

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Flippo, Edward .B. (1984). Personal Management . New Delhi: Mc Graw Hill

Jain, P.k. Khan, M.Y. (2005). Financial Management. New Delhi: Tata McGraw-Hill Publishing Company Ltd, Fourth edition

Kothari, C R. (2004). Research Methodology . New Delhi: Prentice-hall of IndiaPrivate Limited, Eleventh edition

Kotler, Philip. (2009). Marketing Management . New Delhi: New agePublication.


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