Report of Summer Training Conducted at Ayurvet Limited

On Attrition Call Back Analysis

Submitted in partial fulfillment of the requirementsfor the award of the degree of

Master of Business Administration (MBA)

To

Guru Gobind Singh Indraprastha University, Delhi

Guide: Submitted by:Guide Name: Dr.Ajay Pratap Singh Student Name:Megha Nanda Roll No.: 02721303912 Batch: 2012-14

Tecnia Institute Of Advanced Studies

New Delhi – 110085

Batch 2012-14

0

1

Certificate

I, Ms. Megha Nanda, Roll No. .: 02721303912 certify that the Summer Training Report (Paper Code MS-201 entitled “Attrition Call Back Analysis” is done by me and it is an authentic work carried out by me at Ayurvet Limited. The matter embodied in this Report has not been submitted earlier for the award of any degree or diploma to the best of my knowledge and belief.

Signature of the StudentDate:

Certified that the Summer Training Report (Paper Code MS-201) entitled

“Attrition Call Back Analysis” done by Ms. Megha Nanda, Roll

No. 02721303912, is completed under my guidance.

Signature of the Guide

Date:Name of the Guide:Designation:

Countersigned

Director/Project Coordinator

2

DECLARATION

I Megha Nanda, a student of MBA studying at Tecnia Institute Of Advanced Studies,

solemnly declare that the project work title as “Attrition Call Back Analysis” was

carried out by me in the partial fulfillment of the MBA programme under Guru

Gobind Singh Indraprastha University is genuine work of mine. It has not been either

fully or partly related to any other institute prior in any other connection.

This project was undertaken as part of the academic curriculum according to the

University rules and norms and by no commercial interest and motives.

(Megha Nanda)

3

ACKNOWLEDGEMENT

Gratitude is the hardest emotion to express and often one does not find adequate

words to convey one’s entire feelings. I owe my gratitude to Ayurvet Limited, New

Delhi for providing me the opportunity to undergo 2 months summer training,

especially Mrs. Nirupma Srivastava Head of HR Department for allowing me to work

on the project titled ‘Attrition Call Back Analysis’.

It is my foremost duty to express my deep sense of gratitude and respect to my

Supervisor Mr.Harsh Khanna, Ass. Manager of HR for her valuable guidance as well

as uplifting tendency and inspiring me for taking up this project work and complete it

successfully.

I would like to give sincere thanks to everyone in Ayurvet Limited for their extreme

help, self guidance, cooperation and friendliness; they did it in one way or other for

successful completion of the project.

My deep gratitude to Dr. A.K.Rathore, the Director of Tecnia Institute of advance

Studies, who always been playing a great role in all round development of student.

Finally, I would like to put on record my thanks to my Faculty Project Guide Dr. Ajay

Pratap Singh and all teaching and non teaching staff as well as friends for their kind

support, help and assistance, which they extended as and when required.

4

(Megha Nanda)

CONTENTS

S No Topic Page No

1 Certificate (s) 1

2 Declaration 2

3 Acknowledgement 3

4 List of Tables 5

5 List of Symbols 5

6 List of Abbreviations 6

7 Introduction 7

8 Chapter-1: Profile of the Firm/Company 19

9 Chapter-2: SWOT Analysis of the Company 24

10 Chapter-3: Research Methodology 43

11 Chapter-4: Data Collection & presentation 48

12 Chapter-5:Functional Ananlysis of the company 76

13 Chapter-6: Conclusions 79

14 References/Bibliography 81

5

LIST OF TABLES

Table No Title Page No

1 Corporate Office Address 11

2 Manufacturing and R & D Unit Address 11

3 Animal Feed Plant Address 11

TABLE OF SYMBOLS

S No Symbol Nomenclature & Meaning

1 % Percentage

2 @ At the rate

6

TABLE OF ABBREVIATIONS

S No Abbreviated Name Full Name

1 AGES Alternative Green Energy Solutions

2 ARF Ayurvet Research Foundation

3 CFOs Chief Financial Officers

4 DSIR Department of Scientific & Industrial

Research

5 EOQ Economic Order Quantity

6 ERP Enterprise Resource Planning

7 EU European Units

8 F & A Finance and Administration

9 GMP Good Manufacturing Practice

10 ISO Indian Standard Organisation

11 MNCs Multinational National Companies

12 R & D Research and Development

13 SAP Systems Applications and Products

14 SME Small and Medium Enterprises

15 WHO World Health Organisation

7

1.1 INTRODUCTION

Human resources are the only source of long term competitive advantage for any

business organization. It plays a key role in helping companies deal with a fast-

changing competitive environment. It is also the specialized responsibility of the HR

department. Thus Human Resource Management (HRM) is the strategic and coherent

approach to the management of an organization’s most valued assets. Human

Resource Management involves five major areas: staffing, retention, development,

adjustment and managing change. Together they compose the HRM system, for they

describe a network of interrelated components1. However, rising business

competition has led to high attrition rates in many sectors and retaining the employees

is proving to be a herculean task for most organizations in the modern era of

globalization and competitive business.

Attrition is a normal and uncontrollable reduction in the workforce because of

constant stress, retirement, death, sickness and relocation. In simple words, attrition

refers to the number or rate at which the people leave an organization. It is one

method of reducing the size of workforce without management taking any overt

actions. The drawback to reduction by attrition is that reductions are often

unpredictable and can leave gaps in an organization. Attrition is one of the biggest

challenges and it represents significant costs to most organizations. A high attrition

reflects poorly on an organization’s ability to hold on to its people. The toughest

concern for an HR manager is the high attrition rate.

Attrition level can also be more, due to rigid and unpopular HR policies pursued by

8

the corporate. All companies are working day and night to find out a long-term

solution of this complex issue.

The study of attrition is very important because the excess of it tells about the

productivity of the organization. It is obviously difficult for any organization to

operate smoothly and to attain its objectives if employees leave the organization.

Level of attrition beyond the normal range in any organization can have a direct

impact on that organizations effectiveness and efficiency. Most employees leave their

work for reasons other than money; they want more meaning in their work.

Employees seek opportunities that allow them to use and develop their skills. They

often indicate that they want to use their qualities and skills in challenging proper

working teamwork led by capable leaders. There are numerous reasons which may

drive an employee to quit. Some of them are: career opportunities, environment,

psychological satisfaction, unfair practices in organization, stress job & person

mismatch etc. Among management-level employees, the key attrition drivers are such

as opportunities for management, ability of top management, use of skills and abilities

and work/family balance. For professional – level employees, the key attrition drivers

are concern about coaching and counseling from one’s supervisor, clear sense of

direction from the company and chance to do interesting and challenging work.

Among clerical level employees, the key attrition drivers are concern about type of

work, use of skills and abilities and opportunity to learn new skills.

9

Definition of Attrition:

“A reduction in the number of employees through retirement, resignation or death is

called Attrition”. Attrition is also called total turnover or wastage rate.

Definition of Attrition Rate:

“The rate of shrinkage in size or number of employees is known as Attrition rate. It is

usually expressed in percentage.”

Types of Attrition

Attrition is not bad always if it happens in a controlled manner. Some

attrition is always desirable and necessary for organizational growth and

development. The only concern is how

organizations differentiate “good

attrition” from “bad attrition”.

Good Attrition -

Less productive employees voluntarily leaving the organization. This means if the one

who have left the organization fall in the category of low performers, the attrition in

considered being healthy or good attrition.

Attrition rates can be beneficial in some ways:-

When certain employees leave, whose continuation of service would have

negatively impacted productivity and profitability of the company, the company is

benefited.

10

If all employees stay in the same organization for a very long time, most of

them will be at the top of their pay scale which will result in excessive

manpower costs.

New employees bring new ideas, approaches, abilities & attitudes which can

keep the organization from becoming stagnant.

Desirable attrition also includes termination of employees with whom the

organization does not want to continue a relationship. It benefits the

organization in the following ways:

o It removes bottleneck in the progress of the company

o It creates space for the entry of new talents

o It assists in evolving high performance teams

o Business pressures do not allow the management to over-reward the

performers, but when undesirable employees leave the company, the

good employees can be given the share that they deserve.

Bad Attrition: -

In the performance analysis of the ones who have left, if the proportion of high

performers leaving is higher, the attrition is bad attrition. Attrition in any form

means that a wrong choice was made at the beginning while recruiting. Even

good attrition indicates loss as recruitment is a time consuming and costly

affair.

11

In addition to the above two types, there are-

Market Driven Attrition –

Based on the demand for a particular skill- The typical initial reaction by to

market driven attrition is to increase wages, offer better benefits, escape the

market by relocation or site migration or relax hiring standards.

Workload or Stress Driven Attrition -

On the actual capacity to perform the work required. This is when there are

not enough of the right people.

Process Driven Attrition –

Variables associated with job design and/or the organization. In some

industries and organizations there is a belief that attrition has always been

there and rigid process is also responsible.

Employees do not leave an organization without any significant reason. There are

certain circumstances that lead to their leaving the organization. Among management-

level employees, the key attrition drivers are such as opportunities for management,

ability of top management, use of skills and abilities and work/family balance. For

professional – level employees, the key attrition drivers are concern about coaching

and counseling from one’s supervisor, clear sense of direction from the company and

chance to do interesting and challenging work. Among clerical level employees, the

key attrition drivers are concern about type of work, use of skills and abilities and

opportunity to learn new skills.

12

Higher Pay:

The most obvious reason for employees leaving any organization is higher salaries

offered by other Organization with better job opportunity.

Job or work place is not what they expected :

Sometimes the job responsibilities don’t come out to be the same as expected by

the candidates. Unexpected job responsibilities lead to job dissatisfaction.

Job & person mismatch :

A candidate may be fit to do a certain type of job which matches his personality.

If he is given a job which mismatches his personality, then he want be able to

perform it well and will try to find out reasons to leave the job.

Less growth opportunities :

No or less learning and growth opportunities in the current job will make

candidate’s job and career stagnant. Only 20% of employees are able to go to

senior levels. The remaining 80% of employees look for other organization where

they can get opportunities for growth.

Lack of appreciation -

If the work is not appreciated by the supervisor, the employee feels de-motivated

and loses interest in job.

Lack of trust and support in coworkers, seniors and management :

Trust is the most important factor that is required for an individual to stay in the

job. Non-supportive coworkers, seniors and management can make office

environment unfriendly and difficult to work in. When employees are happy with

their superiors they choose to stay, if not they look for a switch.

13

Stress from overwork and work life imbalance :

Job stress can lead to work life imbalance which ultimately many times lead to

employee leaving the organization. If employees feel stressed out due to the

workload trusted on them they tend to look for a change. The major stress factors

are: -

Work Timings

Repetitive Nature of Work

Work Load & Pressure to Perform

Irritative Customers

Travel Time

Long Working Hours

Insufficient Breaks

Health Issues

Compensation:

Better compensation packages being offered by other companies may attract

employees towards themselves.

New Job Offer;

An attractive job offer which an employee thinks is good for him with respect

to job responsibility, compensation, growth and learning etc. can lead an

employee to leave the organization.

Plans for further studies: These days, in many organizations, employees are

joining at very young age because of lucrative salaries being offered. But with

time, they apply for higher education and try to move on to other organizations or

sectors to occupy top positions.

14

Women Workers :

The percentage of women workers is very high, around 30%. Generally, women

workers leave the organization after marriage to take up their house-hold duties,

irregular work hour’s et al. Even when someone relocates with their spouse or

partner, it comes outside the control of any employer.

Costs are often broadly categorized as follows:

Recruiting and hiring costs –

The cost of advertisements; agency costs; employee referral costs;

internet posting costs.

The cost of the internal recruiter's time to understand the position

requirements, develop and implement a sourcing strategy, review

candidates backgrounds, prepare for interviews, conduct interviews,

prepare candidate assessments, conduct reference checks, make the

employment offer and notify unsuccessful candidates. This can range

from a minimum of 30 hours to over 100 hours per position.

Calculate the cost of the various candidate pre-employment tests to

help assess candidates' skills, abilities, aptitude, attitude, values and

behaviors.

Training and orientation costs –

Calculate the cost of orientation in terms of the new person's salary

and the cost of the person who conducts the orientation. Also include

the cost of orientation materials.

15

Calculate the cost of departmental training as the actual development

and delivery cost plus the cost of the salary of the new employee.

Note that the cost will be significantly higher for some positions such

as sales representatives and call center agents who require 4 - 6 weeks

or more of classroom training.

Calculate the cost of the person(s) who conduct the training.

Calculate the cost of various training materials needed including

company or product manuals, computer or other technology

equipment used in the delivery of training.

Lost Productivity Costs – As the new employee is learning the new job,

the company policies and practices, etc. they are not fully productive. Use the

following guidelines to calculate the cost of this lost productivity:

Upon completion of whatever training is provided, the employee

is contributing at a 25% productivity level for the first 2 - 4

weeks. The cost therefore is 75% of the new employee’s full

salary during that time period.

During weeks 5 - 12, the employee is contributing at a 50%

productivity level. The cost is therefore 50% of full salary

during that time period.

During weeks 13 - 20, the employee is contributing at a 75%

productivity level. The cost is therefore 25% of full salary

during that time period.

Calculate the cost of mistakes the new employee makes during

this elongated indoctrination period.

16

New Hire Costs –

Calculate the cost of bring the new person on board including the cost to put

the person on the payroll, computer and security passwords and identification cards,

telephone hookups, cost of establishing email accounts, or leasing other equipment

such as cell phones, automobiles.

Calculate the cost of a manager's time spent developing trust and building

confidence in the new employee's work.

Lost Sales Costs –

Calculate the revenue per employee by dividing total company revenue by the

average number of employees in a given year. Whether an employee contributes

directly or indirectly to the generation of revenue, their purpose is to provide some

defined set of responsibilities that are necessary to the generation of revenue.

Calculate the lost revenue by multiplying the number of weeks the position is vacant

by the average weekly revenue per employee. Reduced loyalty and outright

defections to competitor’s .It is clear that there are massive costs associated with

attrition or turnover and, while some of these are not visible to the management

reporting or budget system, they are none the less real.

The approach to calculate attrition might vary from organization to organization.

While a few techniques are common, there are no proven theories. The most

commonly used formulae are:

17

Total Number of Resigns per month (Whether voluntary or

forced) X 100

----------------------------------------------------------------------------------------------

----------

(Total Number of employees at the beginning of the month+ total

number of new joiners’ - total

number of resignations)

Total Terminations in a month

----------------------------------------------------------------------------------------------

---------

(Total Head Count at the beginning of the month) + (Total New

Hires)

Total No. of employee left X 100

----------------------------------------------------------------------------------------------

---------

Total No .Of employees present

Number of employee separations-involuntary separations X 100

----------------------------------------------------------------------------------------------

--------

*Average employee count

(*Avg. employee count = January month strength + December month strength)

18

Types of attrition calculation

Fresher attrition :

The number of fresher’s who left within one year. It tells you how many are

using the company as a springboard.

Infant mortality:

Percentage of people who left within one year. This indicates the ease with

which people adapt to the company.

Critical resource attrition :

Key men exit.

Low performance attrition :

Those who left due to poor performance.

OBJECTIVES:

1) To identify the financial strengths & weaknesses of the company.

2) Through the net profit ratio & other profitability ratio, understand the

profitability of the company.

3) Evaluating company’s performance relating to financial statement analysis.

4) To know the liquidity position of the company with the help of current ratio.

5) To find out the utility of financial ratio in credit analysis & determine the

financial capacity of the firm.

19

CHAPTER-1

20

PROFILEOF

THE COMPANY

21

1.1 NAME AND ADDRESS OF THE FIRM

Name Ayurvet Limited

Address 6th Floor, Sagar Plaza, District Centre, Vikas Marg,

Laxmi Nagar, Delhi-110092Phone No. 011-22455992, 22455993

Email info@ayurvet.com

Website www.ayurvet.com

Industry Pharmaceutical/ Animal Health Care

Company Type Manufacturing

Table No-1: Corporate Office Address

Address Health Care Products Plant Village: Katha Post Office

Baddi, Tehsil: Nalagarh; District: Solan, Himachal

Pradesh, INDIA- 173205

Phone No. +91-1795-247746, 247690, 247998

Table No-2: Manufacturing and R & D Unit Address

Address28-5 Km, Panipat-Gohana Road, NH-71 H, Village:

Chidana, Tehsil: Gohana, District: Sonipat Haryana,

INDIA- 123301

22

Phone No. Phone: +91-1263-278555

Table No-3: Animal Feed Plant Address

1.2 NATURE OF THE ORGANISATION AND ITS BUSINESS

Ayurvet Limited, a public limited company, was established on 12th October 1992 as

the Veterinary Products division of Dabur India Limited. This was an extension of

Dabur's status as a pioneer in the field of herbal medicines and the desire to include

the animal population in the gamut of its Healthcare operations. In 2002, Ayurvet

Limited branched off from Dabur India Limited and became an independent

company, specializing in natural and safe herbal products for animal species.

Ayurvet Limited is a premier animal healthcare company specializing in Ayurvedic

Veterinary formulations. The products are based on the traditional knowledge of

Ayurveda, validated through modern research using technological tools. The company

blends ayurveda with modern precision and technology to deliver quality-assured and

scientifically-researched formulations for various animal species.

23

CattlePoultry

Pet

EquinePorcine

Aqua

Cattle Feed

Poultry Feed

Figure No- 1: Various Categories of the Products

The company has two manufacturing plants, Herbal Animal Healthcare Products

Manufacturing Plant at Baddi, Solan, Himachal Pradesh (set up in 2005) and Animal

Feed Manufacturing Plant at Chidana, Sonepat, Haryana (set up in 2007). The plant at

Baddi is WHO – GMP certified, EU – GMP compliant and ISO: 9001- 2008 certified.

The unit has a modern and well equipped R&D setup which is approved by the

Department of Scientific and Industrial Research (DSIR), Govt. of India.

Ayurvet has an India- wide Sales and Distribution network. Operations and activities

are divided into: north, south, east and west zones. We work towards customer

satisfaction. We seek long-term relationships based on our comprehensive

understanding of customer needs. Our dedicated field force is tasked to provide our

customers with quality products and services.

Globally, Ayurvet Limited is present in more than 30 countries across various zones

like South Asia, Middle East, South East Asia, Europe and Africa. Our business

partners in Africa and Europe and all the zones in India, individually are contributing

more than 5% of the total revenue. The product range focuses on a range of Farm

animals as well as Aqua and Companion animals. End users of our products are

mainly farmers.

To promote Sustainable Agriculture and Animal Husbandry Practices and support

technologies which are environment-friendly and affordable, Ayurvet Research

Foundation (ARF), a Charitable Trust, was established in 2005. The basic objective of

the trust is to conduct research in the areas of Animal Health, Nutrition & Diagnostics

24

and other areas for the welfare of animals and the economic health of the rural

community.

As a part of the extension services, ARF has initiated a Sambandh programme. This

programme, promotes regular interaction with farmers through Kisan Goshthis, the

Ayurvet Pashu Jagat radio programme, Rural Entrepreneurship Development Centres

and monthly and bi-monthly newsletters in Hindi and English. Sambandh has been a

pioneering attempt to improve livestock productivity, increase employability and

secure livelihoods for farmers. Over the years, ARF has addressed issues like

education, agriculture and livestock development as well as environment and rural

entrepreneurial skills development.

In 2010, Ayurvet AGES Pvt. Ltd., a subsidiary company of Ayurvet Ltd., was formed.

The acronym ‘AGES’ stands for ‘Alternative Green Energy Solutions’. Ayurvet

AGES fosters and promotes ecological and sustainable business growth practices,

while maintaining the highest standards of integrity and performance. We adopt an

‘out- of- box’ approach and develop ecologically superior and economically viable

business models. AGES also works towards reducing the gap between innovation and

implementation.

1.3 COMPANY’S VISION AND MISSION

1.3.1 VISION OF THE COMPANY

Dedicated to improve animal health through the wisdom of traditional knowledge &

modern research.

25

1.3.2 MISSION OF THE COMPANY

To be the leader in providing innovative, safe, dependable and environment friendly

solutions for Animal Health.

1.3.3 ETHOS OF THE COMPANY

To provide EQUAL OPPORTUNITY to our people to realize their full

potential.

To work as A TEAM for achieving our goals and be transparent in our

dealings.

To have a GLOBAL APPROACH for providing scientifically proven

solutions for the health care need of animals.

To dedicate ourselves to achieve the highest level of CUSTOMER

SATISFACTION.

To work for SUSTAINABLE DEVELOPMENT and be mindful of the safety

of the environment, human beings and animals.

1.4 PRODUCT RANGE OF THE COMPANY

At Ayurvet, their endeavour is to blend the ancient knowledge of ayurveda with

modern technology to deliver quality-assured, scientifically tested products for animal

health care. The product portfolio comprises an exclusive range of products for

Cattle, Poultry, Pigs, Equines, Aqua and all Companion animals. All products

are subjected to rigorous testing through a series of lab and field trials across various

Universities and Research labs. Appropriate packaging ensures the retention of

properties and ease-of-use.

26

Figure No- 2: Product Range of the Company

1.4.1 CATTLE

Cattle rearing have always been the corner stone of Agrarian systems. To serve this

segment, Ayurvet has researched and developed an exclusive range of herbal health

care products to cater to all the vital needs of livestock. This range of products has

been developed to improve the health of livestock and enhance productivity without

compromising on safety and sustainability. Various products under Cattle range are:

27

AFANIL

AYUMIN

AYUMIN V 5

CALDHAN V

CHARMIL

DIAROAK

EXAPAR

HILAK

JANOVA

MASTILEP

MASTRIP

MINTRUS

PACHOPLUS

PAYAPRO

RESTOBAL

RUCHAMAX

UNISELIT

VITADHAN

YAKRIFIT

1.4.2 POULTRY

The Poultry industry is rapidly transforming itself into a commercial venture from a

traditional farming activity. Ayurvet's portfolio of poultry products has been

developed keeping in mind the modern Poultry farming practises. The portfolio

includes products aimed at maximising production and maintaining the natural health

of the flock. Various products under Poultry are:

28

AYUCAL D

AYUCEE

AYUFYTASE 5000

AYUMIN V

CHIKIMUNE

DIAROAK

METHIOREP

REPCHOL

RESPZZ

SALCOCHEK

STRESROAK

SUPERLIV

TOXIROAK

VILOCYM

VILOCYM Z

VITADHAN

XLIVPRO

1.4.3 EQUINES

Ayurvet has developed a range of Equine products to care for the health of horses and

thoroughbreds and enhance performance through the natural way. These products

have been developed after years of research and are perfectly natural, safe and without

side-effects. The various products are:

EQDERM G

EQDERM L

EQRESP

29

EQSPURT

1.4.4 ANIMAL FEED

Recognizing the direct relation between nutrition, health and productivity, Ayurvet

entered the promising Animal feed market in 2005. By combining the science of

herbals with nutrition, the company hopes to bring out a range of value-added and

customised feed and nutrition products to cater to a wide range of animal

species. Currently, the portfolio of products include Cattle Feed, Pig Feed and

specialty feeds for Buffaloes. Research work is going on to develop Feed products for

other species and also on herbal-enriched nutrition products. All products are

available in key North Indian states, produced from a recently commissioned state-of-

art factory in Chidana, Haryana. The products are:

AYURVET UTTAM SUPER

AYURVET UTTAM SUPER GOLD

AYURVET UTTAM SUPER GOLD BUFFALO SPECIAL

AYURVET UTTAM SUPER GOLD DAIRY SPECIAL

1.4.5 OTHER SPECIES

Ayurvet offers a complete range for products for Camels, Aqua (Fish, Shrimps and

Prawns), Pigs, Pets and other companion animal species. Developed to cater to a wide

range of problems facing these animals, the products offer a natural and safe

alternative to conventional health care systems.

AYUCAL AQ

AYUMIN

CALOZ

30

CHARMAID

CHARMIL

DIAROAK

EXAPAR

LIVJIVAN

LOAMGLO

NEWCHARM

OTOSAF

PAYAPRO

RESTOBAL

RUCHAMAX

SPIRUMAX AQ

STRESROAK AQ

SUPERLIV AQ

VITACHARM

YAKRIFIT

ZEROKEET

1.5 SIZE OF THE ORGANISATION

The company has total manpower of more than 350 employees and its turnover in the

year 2011-12 was 70.28 crores.

1.6 ORGANISATION STRUCTURE

31

1.7 MARKET SHARE AND POSITION OF THE COMPANY

The total market size of veterinary pharmaceutical industry is approximately Rs. 1900

crores in India. The top most company in India is Virbac having almost 12% market

share followed by Pfizer almost 10% market share. Then Provimi nutrition India has

10% of the total share. Ayurvet’s share is about Rs. 85.5 crores which is about 4.5%

of the total industry.

1.8 PRESENT LEADERSHIP

Mr. Ashish Jain- GM (Accounts & Finance)

32

Chairman

Managing Director

GMAccounts & Finance

Legal

IT

Sr. Manager Accounts &

Finance

Assistant

ManagerSenior

Executive

Executive Finance

GMHuman Resources

Assistant Manager

Senior Executive

Executive Human

Resources

GM Sales & Marketing

Export

ManagerAssistant

ManagerExecutive Export

Sales ManagerFiel

d Force

200 employees

Institution

al Sales Head

Ms. Nisha Mittal- DGM (Accounts & Finance)

Mr. Harsh Khanna- Assistant Manager (Human Resources)

Dr. Ashish Sachdeva- Deputy Manager (Product)

Mr. Rajesh Kumar- Head Institutional Sales

Ms. Monika Jain- Manager (Marketing)

Ms. Simple Jain- Company Secretary

Mr. Purushottam Pathak- Executive IT

Ms. Kanchan Chauhan- Sr. Executive (Human Resources)

1.9 SOURCE OF DATA COLLECTION

Data has been collected from both the primary as well as secondary sources.

Primary Data: Primary data is the data that has not been previously published, i.e.,

the data is derived from a new or original research study and collected at the source. It

is the information that is obtained directly from the first hand sources by means of

surveys, observation or experimentation.

Primary Data has been collected through following means:

Structured interview

Observation

Secondary Data: Secondary data is the data that have been already collected by and

readily available from other sources. Sources of secondary data include the internet,

libraries, company reports, newspaper, etc. The data collected is useful as it allows the

researcher to see the prevailing thoughts about his/her area of study.

Secondary Data has been collected from the following sources:

www.ayurvet.com

33

Annual Report of Ayurvet Ltd.

Sustainability Report of the company

CHAPTER-234

SWOTANALYSIS

2.1 The Porter's Five Forces SWOT Analysis Model

The Porter's Five Forces tool is a simple but powerful tool for understanding where

power lies in a business situation. This is useful, because it helps you understand both

the strength of your current competitive position, and the strength of a position you're

considering moving into .With a clear understanding of where power lies, you can

take fair advantage of a situation of strength, improve a situation of weakness, and

avoid taking wrong steps. This makes it an important part of your planning toolkit.

35

Conventionally, the tool is used to identify whether new products, services or

businesses have the potential to be profitable. However it can be very illuminating

when used to understand the balance of power in other situations.

Understanding the Tool:

Five forces Analysis assumes that there are five important forces that determine

competitive power in a business situation. These are:

1. Supplier Power: Here you assess how easy it is for suppliers to drive up

prices. This is driven by the number of suppliers of each key input, the

uniqueness of their product or service, their strength and control over you, the

cost of switching from one to another, and so on. The fewer the supplier

choices you have, and the more you need suppliers' help, the more powerful

your suppliers are.

2. Buyer Power: Here you ask yourself how easy it is for buyers to drive prices

down. Again, this is driven by the number of buyers, the importance of each

individual buyer to your business, the cost to them of switching from your

products and services to those of someone else, and so on. If you deal with

few, powerful buyers, then they are often able to dictate terms to you.

3. Competitive Rivalry: What is important here is the number and capability of

your competitors. If you have many competitors, and they offer equally

attractive products and services, then you'll most likely have little power in the

situation, because suppliers and buyers will go elsewhere if they don't get a

good deal from you. On the other hand, if no-one else can do what you do,

then you can often have tremendous strength.

36

4. Threat of Substitution: This is affected by the ability of your customers to

find a different way of doing what you do – for example, if you supply a

unique software product that automates an important process, people may

substitute by doing the process manually or by outsourcing it. If substitution is

easy and substitution is viable, then this weakens your power.

5. Threat of New Entry: Power is also affected by the ability of people to enter

your market. If it costs little in time or money to enter your market and

compete effectively, if there are few economies of scale in place, or if you

have little protection for your key technologies, then new competitors can

quickly enter your market and weaken your position. If you have strong and

durable barriers to entry, then you can preserve a favorable position and take

fair advantage of it.

These forces can be neatly brought together in a diagram like the one in figure below:

37

Figure No- 3: Porter's Five Forces Model

38

2.2 STRENGTHS AND WEAKNESSES OF THE COMPANY

2.2.1 STRENGTHS OF THE COMPANY

Products based on traditional knowledge of Ayurveda and validated

through modern research.

Well established and wide Sales and Distribution network.

Specialization in natural and safe herbal products.

Certified under WHO-GMP, EU-GMP and ISO: 9001-2008.

Globally located in more than 30 countries.

Focus on environment friendly products.

Good Financial position.

Awarded “SME 1” rating by India’s leading credit rating agency CRISIL.

Self reliant technology for production.

2.2.2 WEAKNESSES OF THE COMPANY

Since the company deals in Ayurvedic products only, so the company’s

range is limited.

Lack of resources to compete with MNCs for new drug discovery research

and to commercialize molecules on a worldwide basis.

Inadequate regulatory standards.

Low medical expenditure and healthcare spend in the country.

No common goal, each person is working for different objective.

Decreasing level of mutual trust between team members, management.

Lack of sufficient field staff

39

2.3 OPPORTUNITIES AND THREATS OF THE COMPANY

2.3.1 OPPORTUNITIES OF THE COMPANY

Significant export potential.

Marketing alliances to sell MNCs products in domestic market.

High potential to penetrate further in domestic market; to replicate the

success of Bihar, AP in other states as well.

Niche player in global pharmaceutical R&D.

Strong base of scientific as well as technical manpower and also due to

pioneering work done in process development.

Diversification to related business like herbal extracts, nutraceuticals,

allopathic veterinary segment etc.

Since the company is present in only 30 countries so niche countries need

to be explored.

2.3.2 THREATS OF THE COMPANY

Product patent regime poses serious challenge to domestic industry unless

it invests in research and development.

R&D efforts of Indian pharmaceutical companies hampered by lack of

enabling regulatory requirement.

Entrants of newer players in highly fragmented market.

High promotional cost.

New and existing competitors like Indian Herbs, Natural Remedies, Cattle

Remedies, etc.

Availability and cost of herbs as business volumes grow

Different regulatory requirements in different countries

40

2.4 BEST PRACTICES/USPs OF THE COMPANY

2.4.1 HUMAN RESOURCES

Establish multi-functional teams to identify best practices and increase employee

buy-in for initiatives- To identify its best business practices, Ayurvet Limited

brought together 5 top managers and supervisors from all plants and all functions and

assigned them to five teams. Together they identified and consolidated the division's

best practices. In the course of their best practices identification project, the division

developed a set of 88 performance measures falling into five critical management

areas. They included financial management, production, quality, transportation, and

health and safety. Each job area has a handful of measures to monitor the progress of

work efforts. The measures help employees to understand how well they are

performing the best practices and how well they are performing relative to their peers

in other plants.

2.4.2 FINANCE

Ayurvet combines a deep understanding of financial accounting and reporting with a

broad knowledge of running industrialized business services for CFO’s organization,

F&A operations outsourcing, business process transformation, smart technologies,

smarter analytics and best practices. In addition, their highly evolved Learning Path

enables them to offer clients the right mix of well-tested theoretical expertise and

hands-on operational experience. Citrix based applications are used to access remote

databases.

41

2.4.3 INFORMATION TECHNOLOGY

Ayurvet’s best practices of SAP-ERP baselines package provides a comprehensive

and flexible business management response to business needs with built in support for

best business practices. Best practices of SAP-ERP cross industry packages provide

predefined business scenarios that focus on the areas of customer relationship

management, supply chain management and business intelligence.

2.4.4 MARKETING

A global approach: Ayurvet’s Global Ethical Interactions Policy provides a single

common, principle-based approach to all their interactions with public officials,

healthcare professionals and healthcare organisations, and community organisations

worldwide. This means that everyone in Ayurvet, wherever they are located, is

required to work to our global standards of ethical sales and marketing practice.

Delivering consistently high standards of sales and marketing practice is one of our

top priorities and sits at the core of our commitment to driving commercial success

responsibly. Our activities centre on making sure that the appropriate information is

provided to those who need it to support the safe and effective use of our medicines

and enhance patient care.

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2.5 DEVIATIONS/VARIAIONS IN PRACTICES

2.5.1 DEVIATION IN FINANCE

According to what we have studied in class room, Capital budgeting is the planning

process used to determine whether an organization's long term investments such as

new machinery, replacement machinery, new plants, new products, and research

development projects are worth the funding of cash through the firm's capitalization

structure (debt, equity or retained earnings). It is the process of allocating resources

for major capital, or investment, expenditures.

But in Ayurvet no capital budgeting is done, company simply invest in a project with

the mutual decision of the top management without analyzing the project through any

technique such as Accounting Rate of Return, Payback Period, Net Present Value,

Profitability Index, Internal Rate of Return, Modified Internal Rate of Return,

Equivalent Annuity and Real options valuation.

The capital budgeting decisions affect the profitability of the firm for a long period;

therefore the importance of these decisions is very much crucial. Even a single wrong

decision by a firm may endanger the existence of the firm as a profitable firm. There

are several factors and considerations which make the capital budgeting decisions as

the most important decisions of a finance manager. Thus, the capital budgeting

decisions involve a large irreversible commitment of resources i.e., subject to a

significant degree of risk. These decisions may have far reaching effects on the

profitability of the firm. These decisions therefore require a carefully developed

decision making process and strategy based on reliable forecasting system.

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2.5.2 DEVIATION IN OPERATIONS

As we have studied in class room, every company must calculate Economic Order

Quantity (EOQ) to minimize its cost on inventory and place order according to the

EOQ level. However Ayurvet does not calculate EOQ level and simply place order

for raw material whenever it is required in different quantities.

44

CHAPTER-3

RESEARCH METHODOLOGY

45

In Research Methodology mainly Data plays an important role. The Data is divided in

two parts:

a) Primary Data.

b) Secondary Data.

Primary Data –

The data is collected by telephonic interview, Information received through drafting a

questionnaire.

Secondary Data -

Is the data, which is collected from the various books, magazine and material, reports,

etc. The data which is stored in the Organization and provide by the HR people are

also secondary data.

Sample and sampling method -

Is a smaller representation of the population , it is any number of persons selected to

represent the population , according to some rules or plans .ON the basis of sample

sampling methods are identified which method to choose generally there are two

methods of sampling ie; probability sampling method and non-probability sampling

method.

The sampling method used in this project report is that clearly specifies the probability

or likelihood of inclusion of each and every element or individual in the sample. Thus

sampling technique used is the present project report is SIMPLE RANDOM

SAMPLING technique .

Some features of simple random sampling are as follows-

46

The size of the parent population or universe from which the sample is to be

taken must be known to the investigator.

Each element or individual must have an equal chance of being included in the

subsequent sample.

The desired sample size must be clearly specified.

The sampling method used in the present project is Random Sampling Method.

In this method each and every individual have chances of being included.

Research methodology portion captures a unique blend of the possible Causes of

Attrition , in the industries , corporate houses ,and especially in the insurance sector .

In this process , the number of causes or variables which directly or indirectly

increases the rate of attrition and leads towards dump of employee’s turnover debt

were sorted out on the basis of those dimensions or causes a well structured

questionnaire was prepared named “ EMPLOYYEE ATTRITION RATING

SCALE” , employees and by secondary source which included drawing information

from the website of AYURVET and also by talking to the existing employees of

AYURVET to understand the current problem across the veterinary sector .

Sample

Population-

The well identified and specified group is known as a population. It may be of

two types i.e;

Finite population -

Is one where all the members can be easily counted. Whereas

Infinite population –

47

Is one where size is unlimited and therefore its members cannot be

counted.

In this report population is finite in nature and population size is 450.

Sample -

It is the representative of population which holds all the characteristics

of population .

Sample size of this research report is 65. Out of which it was divided

into three parts ie

Cases of voluntary resignation - 21

Cases of involuntary absconding -08

Cases of involuntary termination -09

So our sample size is 65 as report is based on the cases of resignation

only

For the process of collecting data the structed interview was conducted in

which all the 13 statements where asked to the to the exited employees and

they were asked to reply on the basis of 5- point rating scale ie; LIKERT

SCALE and also subjective responses were provided by them in the form of

suggestions .after the process of data collection these 13 statements where

arranged accordingly on the basis of dimensions.

Salary Issues 17

Management Issue 5

Growth Prospects 7

Not Happy 8

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CHAPTER-4

DATACOLLECTION

ANDPRESENTATION

49

A. DATA COLLECTION

4.1 MARKETING

4.1.1 PRODUCT PLANNING PROCESS

Product planning is the process of creating a product idea and following through on it

until the product is introduced to the market. Product planning entails managing the

product throughout its life using various marketing strategies, including product

extensions or improvements, increased distribution, price changes and promotions.

The product planning process at Ayurvet consists of the following steps:

1. Developing the Product Concept: The first phase of product planning is

developing the product concept. Marketing managers usually create ideas for new

products by identifying certain problems that consumers must solve or various

customer needs. After the product idea is conceived, managers will start planning the

dimensions and features of the product. Some small companies will even develop a

product mock-up or model.

2. Studying the Market: The next step in the product planning process is studying

the competition. Secondary research usually provides details on key competitors and

their market share, which is the percent of total sales that they hold in the

marketplace.

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3. Marketing Research: The next crucial step is to go for the market research.

Ayurvet considers doing both qualitative and quantitative marketing research for its

new product. The company basically conducts prior testing of the product.

4. Product Introduction: If the product is successful, the company then decides to

sell the new product on a small scale or regional basis. During this time, the company

distributes its products in one or more cities.

5. Product Life Cycle: Product planning must also include managing the product

through various stages of its product life cycle. These stages include the introduction,

growth, maturity and decline stages. Sales are usually strong during the growth phase,

while competition is low. However, continued success of the product will pique the

interest of competitors, which will develop products of their own. The introduction of

these competitive products may force a small company to lower its price. This low

pricing strategy may help prevent the small company from losing market share.

4.1.2 PRICING POLICIES/STRATEGIES

Pricing is one of the four elements of the marketing mix, along with product, place

and promotion. Pricing strategy is important for companies who wish to achieve

success by finding the price point where they can maximize sales and profits.

Following are the various pricing policies/strategies used in Ayurvet:

1. Cost-plus pricing: The firm calculates the cost of producing the product and

adds on a percentage (profit) to that price to give the selling price.

2. Skimming: Ayurvet also use skimming as the pricing policy for some of their

products. In this, products are sold at higher prices so that fewer sales are

needed to break even.

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3. Market-oriented pricing: Here prices are based upon analysis and research

compiled from the target market. This means that marketers set prices

depending on the results from the research. For instance if the competitors are

pricing their products at a lower price, then it's up to them to either price their

goods at an above price or below, depending on what the company wants to

achieve.

4. Penetration pricing: Penetration pricing includes setting the price low with

the goals of attracting customers and gaining market share. The price will be

raised later once this market share is gained.

5. Price discrimination: Price discrimination is also used for some products.

Price discrimination is basically the practice of setting a different price for the

same product in different segments to the market.

6. Premium pricing: Premium pricing is the practice of keeping the price of a

product artificially high in order to encourage favorable perceptions among

buyers, based solely on the price. The practice is intended to exploit the

tendency for buyers to assume that expensive products enjoy an exceptional

reputation, are more reliable or desirable, or represent exceptional quality and

distinction.

7. Contribution margin-based pricing: Contribution margin-based pricing also

helps Ayurvet in maximizing the profits derived from an individual product,

based on the difference between the product's price and variable costs, and on

one’s assumptions regarding the relationship between the product’s price and

the number of units that can be sold at that price.

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4.1.3 CHANNEL PLANNING AND MANAGEMENT

Channel management is the process by which the company creates formalized

programs for selling and servicing customers within a specific channel in a positive

way. Very similar to running a small business, you have to know your company, your

channel partner's business, and your customer's issues. Sales channels come in many

descriptions and shapes. For the purposes of this article, we will focus on selling your

product or service using some type of partner organization and not direct selling.

4.2 HRM

4.2.1 HR PLANNING

Human Resource (HR) Planning is the most crucial step for any organisation. After

jobs have been analysed and the information has been put into a job description and

specification, the human resource planning begins. At Ayurvet the HR Planning starts

at the time of Annual Budgeting. Every department shares their expected manpower

requirement annually after proper evaluation as per the set targeted profits by the

management. After receiving the department wise manpower requirement, the HR

department evaluates as per the Company’s set objectives and goals for the year and

then after discussion, management’s requirements are freezed.

HR Planning helps Ayurvet in the following ways:

Determine the number of personnel needed for the future.

Predict changes skills needed for different jobs.

Determine how many people with the right qualities are needed at what time

so that it can attract candidates in time.

The information gathered through HR Planning can be used for other HR

management function.

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4.2.2 RECRUITMENT AND SELECTION

In order to increase efficiency in hiring and retention and to ensure consistency and

compliance in the recruitment and selection process, Ayurvet follows the following

steps:

Step 1: Identify Vacancy and Evaluate Need

Step 2: Develop Position Description

Step 3: Develop Recruitment Plan

Step 4: Select Search Committee

Step 5: Post Position and Implement Recruitment Plan

Step 6: Review Applicants and Develop Short List

Step 7: Conduct Interviews

Step 8: Select Hire

Step 9: Finalize Recruitment

4.2.3 TRAINING AND DEVELOPMENT

Creativity and innovation are pre-requisite for attaining and sustaining success.

Emphasis on right-brain functions helps creativity, big-picture thinking and the ability

to conceptualize. Training and Development helps to optimize the utilization of

human resources. This also helps the employee to achieve organizational and

individual goals. Ayurvet focuses on developing talent from within.

The training programs are conducted at “Gurukul - the Learning Centre”. Ayurvet

conducts regular training programs to enhance learning through other peoples’

experiences. Employees are trained on all the latest needs of the business to help them

adapt to the ever changing global scenario. Internal and external faculty conducts the

training. During the year 2011-2012 a total of 40 hours of training was conducted.

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Various programs such as “Managerial Effectiveness” for managerial level staff

members, “Wellness Workshop”, “Team Building for Sales Force”, “Thomas

Profiling” for HR Team Members, and a number of other Open House workshops

were organized throughout the year. Employees are also sent to a number of seminars

and conclaves. Some of the seminars attended by team members in the year 2011-12

were:

1. IPO & Pvt Equity Conclave

2. Finance for Non Finance Manager

3. Women Entrepreneurship-Unplugged

4. Risk Management

5. CSR Conclave

An array of training & development programs were also organized at the two plants:

1. Safety Training-PPE & Health Hazards

2. Safety in Manual Material Handling

3. Life style Management & FER Practical Refresher

4. Disaster Management

5. ETP Water reuse & recycle

6. WHO-GMP

7. Fire Fighting

8. Electrical Safety

9. Risk Management

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10. Know Your SOPs and Work Instructions

11. Training Program on Prevention & Management Chemical Accident

4.2.4 EMPLOYEE WELFARE

Ayurvet believes in the quality of benefits provided to its employees, which actually

play a major role in retention and keeping them engaged or involved in the company.

In their endeavor to preserve the Human Capital, various benefits and plans are in

place for their well-being. Some benefits are as under:

Provident Fund -Provident Fund (PF) is a statutory contribution of 12% of

annual basic component by the employer to the PF Department. This is in

addition to the employee contribution of 12% of the annual basic salary. The

accumulation of this amount provides the employee a fund which he/she may

withdraw at the time of financial exigencies in life or at the time of retirement.

Accidental/ Hospitalization insurance benefits- An accident can happen any

time, so Ayurvet this benefit in order to ensure that the family of the victim

does not have to bear the financial burden of medical treatment. Personal

Accidental Insurance cover offers a comprehensive coverage at affordable

costs. The cover extends to the entire family, including dependent parents and

dependent children, with a single policy. At Ayurvet, both Personal Accident

Insurance and Hospitalization are covered through distinct policies available,

to insure the health, safety and security of the employees.

Leave Travel Allowance (LTA) - Ayurvet believes that vacations are

essential to reduce stress and keep employees creative, to enhance the quality

of life both at professional and personal levels and to help employees to

maintain a work/life balance. LTA is remuneration provided by an employer

56

to an employee to compensate for the travel expenses incurred for a vacation.

Our policies are defined so that this allowance benefits all our employees.

Gratuity scheme- Gratuity is another powerful source of benefits received by

employees when leaving a company. Ayurvet has carefully invested in the

Group Gratuity plan from LIC of India which offers a number of benefits in

addition to fulfilling the statutory requirements.

Leave encashment- Ayurvet has also implemented the Group Leave

Encashment Scheme from LIC of India, offering benefits over and above

statutory requirements.

Education Loan for further studies- Ayurvet also understands the

importance of education and continuous learning. They understand that

monetary obligations sometimes restrict an individual’s desire to study further.

Thus, a subsidy of 25% of the course fee is offered by the management to all

its employees. Employees are also given full fee sponsorship for specific

course programs which will upgrade their knowledge and skills to the benefit

of the Company.

House Loan/Car Loan subsidy- Ayurvet believes in providing social security

and up-liftment to its employees. This improves morale and the quality of

work. Thus, Ayurvet supports its employees in the form of subsidies on

Housing and Car loans.

Superannuation scheme- Considering that the needs of a family may

mushroom in the years after retirement, a group plan of Superannuation has

been provided to the employees who voluntarily contribute to this scheme.

Maternity leave for female employees- According to the Maternity Benefit

Act, leave with wages for a certain period, for employees availing of

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Maternity leave, is mandatory. However, Instead of the statutory requirement

of Basic salary for the period, Ayurvet pays the gross salary.

4.3 PRODUCTION AND OPERATIONS

4.3.1 PRODUCTION AND PROCUREMENT PLANNING

The Production Planning and Procurement Planning enterprise process area includes

the business processes for sales quantity planning and demand management planning.

It includes:

Importing strategic sales and profit planning from areas upstream in the

enterprise, such as a sales plan from the sales area

Sales and operations planning for long-term planning of product groups and

important products.

Forecasting, which uses historical sales and operations figures to propose

current planning values

Long-term planning

Master production scheduling for medium and long-term demand

management of important A products

Demand management and material requirements planning

Master data for these processes

 

Use

Ayurvet uses these planning processes in its enterprise for the following types of

business planning:

Make-to-order planning using the requirements arising directly from a

particular sales order

Consumption-based planning with reorder-point procedure and forecasting

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Market-oriented planning with planned independent requirements determining

production and procurement without reference to specific sales orders.

Planning with consumption for managing planned independent requirements

that are subsequently offset dynamically against consumption for sales orders

received

Variant planning of various kinds, for managing the planning and

consumption of variant-rich products

 

4.3.2 SUPPLY CHAIN MANAGEMENT

Supply chain management (SCM) is the management of an interconnected or

interlinked between network, channel and node businesses involved in the provision

of product and service packages required by the end customers in a supply

chain. Supply chain management spans the movement and storage of raw materials,

work-in-process inventory, and finished goods from point of origin to point of

consumption. It is also defined as the "design, planning, execution, control, and

monitoring of supply chain activities with the objective of creating net value, building

a competitive infrastructure, leveraging worldwide logistics, synchronizing supply

with demand and measuring performance globally." Ayurvet believes that they must

rely on effective supply chains, or networks, to compete in the global market and

networked economy.

4.3.3 INVENTORY MANAGEMENT

Inventory management is the overseeing and controlling of the ordering, storage and

use of components that a company will use in the production of the items it will sell

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as well as the overseeing and controlling of quantities of finished products for sale. A

business's inventory is one of its major assets and represents an investment that is tied

up until the item is sold or used in the production of an item that is sold. It also costs

money to store, track and insure inventory. Inventories that are mismanaged can

create significant financial problems for a business, whether the mismanagement

results in an inventory glut or an inventory shortage.

Successful inventory management involves creating a purchasing plan that will ensure

that items are available when they are needed (but that neither too much nor too little

is purchased) and keeping track of existing inventory and its use. Two common

inventory-management strategies are the just-in-time method, where companies plan

to receive items as they are needed rather than maintaining high inventory levels, and

materials requirement planning, which schedules material deliveries based on sales

forecasts. 

4.3.4 QUALITY ASSURANCE AND CONTROL

Ayurvet is ISO 9001:2008 certified organisation. Its manufacturing plants at Chidana

and Baddi are WHO-GMP certified and EU-GMP compliant. Ayurvet also received

the “Rajiv Gandhi National Quality Commendation” Award in 2010 from BIS

(Bureau of Indian Standards). The company is also able to maintain “SME 1” rating

awarded by India’s leading credit rating agency CRISIL. The rating indicates that the

level of credit worthiness of Ayurvet Ltd, adjudged in relation to other SMEs, is

highest.

4.4 FINANCE

60

4.4.1 Analysis of Balance Sheet

Balance Sheet (Rs. in lacs)Mar '09 Mar '10 Mar '11 Mar '12

Sources Of Funds

Total Share Capital 4162.65 3567.49 3662.26 4062.55

Equity Share Capital 982.44 982.44 982.44 1083.20

Share Application Money 114.05 0.00 0.00 0.00

Reserves 3066.16 2585.05 2679.82 2979.35

Secured Loans 487.04 989.40 768.24 803.07

Unsecured Loans 1232.15 73.07 74.61 70.71

Total Debt 1719.19 1062.47 842.85 873.78

Deferred tax liabilities 199.48 246.14 289.79 224.68

Total Liabilities 6081.32 4876.10 4794.90 5161.01

Application Of Funds

Gross Block 3975.55 4062.23 4199.02 4822.9

Less: Accumulated Depreciation 736.98 878.16 1031.81 901.25

Net Block 3238.57 3184.07 3167.21 3621.66

Capital Work In Progress 0.00 0.00 20.44 0.00

Investments 1.45 1.45 51.73 48.73

Deferred Tax Assets 51.25 60.29 80.73 0.00

Inventories 508.59 597.94 843.69 677.58

Sundry Debtors 825.15 807.74 840.93 1023.53

Cash and Bank Balances 718.52 328.70 179.24 235.83

Other Current Assets 0.00 0.00 31.18 250.96

Total Current Assets 2052.26 1734.38 1895.04 2187.90

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Loans and Advances 151.64 209.54 353.57 239.91

Total Current Assets, Loans &

Advances2203.92 1943.92 2248.61 2427.81

Current Liabilities 487.61 529.48 562.99 719.11

Provisions 13.98 54.09 210.84 218.08

Total Current Liabilities &

Provisions501.59 583.57 773.83 937.19

Net Current Assets 1702.33 1360.35 1474.78 1490.62

Total Assets 6081.32 4876.10 4794.90 5161.01

Interpretation:

Total Share Capital: Total Share Capital is highest in march 2009 if

compared in last 4 years than its own decreasing trend till March 2011 as share

application money has returned. Total share capital has again increased in

2012 as new shares have been issued.

Secured and Unsecured Loans: Secured loans have shown an increasing

trend from 2009 to 2012. On the other hand unsecured loans have a decreasing

trend which shows the company’s willingness of shifting their debt financing

from unsecured to secured loans.

Fixed Assets: Fixed assets of Ayurvet Ltd. are showing good numbers. They

have decreasing trend from 2009 to 2011 but again have increased in 2012 as

company has purchased bulk of assets.

Inventories: Inventories have shown an increasing trend from 2009 to 2011

but fall again in 2012 as sales in 2012 have jumped up as compared to

previous year.

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Total Current Assets: Total Current Assets have shown a decreasing trend

till 2011 and have increased in 2012. The major increment in the total current

assets is driven by sundry debtors in 2012.

Total Current Liabilities: Current liabilities have shown an upward trend

from 2009 to 2012 as company’s cost of material has rose up.

4.4.2 Analysis of Profit and Loss Statements

Profit and Loss Account (Rs. in lacs)

Mar '09 Mar '10 Mar '11 Mar '12

Income

Net Sales 4410.73 5000.50 5951.51 6986.90

Other Income 659.20 85.06 190.24 41.17

Total Income 5069.93 5085.56 6141.75 7028.07

Expenditure

Cost of Materials 2155.11 2214.08 2643.49 2974.66

Manufacturing & Operating

Expenses259.11 228.79 326.58 150

Employees Cost 627.86 660.80 776.33 1035.12

Selling and Admin Expenses 1071.45 1252.88 1532.41 1970.17

Financial Expenses 225.56 171.78 108.18 6910

Depreciation 144.45 142.70 165.28 171.56

Total Expenses 4483.54 4671.03 5552.27 6370.61

PBT 586.38 414.53 589.48 657.46

Tax 67.92 37.62 110.20 149.63

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PAT 518.46 376.91 479.28 507.83

Interpretation:

Total Income: The net sales as depicted in Profit and Loss Account has an

increasing trend from 2009 to 2012 which shows company’s improvement in

performance. On the other hand, other incomes have very less contribution in

group of total income.

Total Expenses: The total expenses are primarily driven by cost of materials.

All the other expenses like employee cost, selling and administration

expenses, etc. have equal influence on the total expenses figure.

Profit: Profit is maximum in 2012 which is influenced by large volume of

sales.

4.4.3 Analysis of Cash Flow Statements

Cash flow Statement (Rs. in lacs)

Mar ' 09 Mar ' 10 Mar ' 11 Mar ' 12

Net Profit before tax 586.38 414.52 589.48 657.46

Net cash from operating

activities

392.40 595.90 495.99 535.63

Net cash from/(used) in

investing activities

440.99 (699.88) (422.71) (266.54)

Net cash used in financing

activities

(283.76) (285.83) (222.73) (212.50)

Net increase/decrease in cash

and equivalent

549.63 (389.81) (149.45) 56.59

Cash and cash equivalents at

beginning of year

168.88 718.52 328.70 179.24

Cash and cash equivalents at

end of year

718,52 328.70 179.25 235.83

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Interpretation:

The cash flow statement shows that the net profit before tax first decreased in

the year 2010 and then increased in the years 2011 and 2012 driven by large

volume of sales.

The net cash from the operating activities continuously increased from the

2009 to 2010. Then it decreased a bit from 2010 to 2011 and then increased in

2012. This shows the sound position of the firm as well aggressive credit

collection measures.

The statement shows that net cash from investing activities was positive in

2009 and then became negative in rest three years which means the firm is not

enough contributing in investment as companies view is increasing the volume

of sales.

The net cash used in financing activities is negative in all four years. Neither it

is increasing at a very high pace nor is it decreasing. Rather, it is almost stable

which depicts that company is not raising further finance.

The opening cash and cash equivalents are minimum in the year 2009 and

maximum in the year 2010. The Closing cash and cash equivalents maximum

in the year 2009 and minimum in the year 2011 shows the firm maintain the

maximum liquidity position in the year 2009.

The cash and cash equivalents of the firm increased in the year 2012 which

shows the high liquidity position of the firm.

4.5 IT

Ayurvet runs SAP Business One as Enterprise resource planning (ERP) system which

integrates internal and external management of information across an entire

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organization—embracing finance/accounting, manufacturing, customer relationship

management, sales and service, marketing, etc.

ERP systems automate this activity with an integrated software application. It

facilitates information flow between all business functions inside the organization,

and manages connections to outside stakeholders. Ayurvet considers the ERP system

as their backbone, and a vital organizational tool because it integrates varied

organizational systems, and enables flawless transactions and production. ERP

systems can run on a variety of computer hardware and network configurations,

typically deploying a database as a repository for information.

Ayurvet Limited has 3 separate database – Corporate Office, New Delhi; Ayurvet

Feed Business (AFB), Chidana and Manufacturing Unit, Baddi. For remote users

(manufacturing, sales employees, etc.), Ayurvet is using Citrix Software (Application

Virtualization Software). The company has its own firewall system to prevent all

those unwanted websites, threats, etc.

Web applications are popular due to the ubiquity of web browsers, and the

convenience of using a web browser as a client, sometimes called a thin client. The

ability to update and maintain web applications without distributing and installing

software on potentially thousands of client computers is a key reason for their

popularity, as is the inherent support for cross-platform compatibility.

B. DATA PRESENTATION

Employees Attrition Rate in AYURVET

After the detail Analysis of Attrition in context of meaning, Types,

Calculation of Attrition rate & impact of Higher Attrition on

Organizational growth. Now I am focusing on, why attrition rate is

higher in Ayurvet Company Ltd.?

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Attrition rate across the Departments/ Channels for FY 2011-2012

Total No. of Employees as on 1st April 2009 (Across Location)= 225

Total No. of Exit Cases (Across the Location)=37

Total Attrition Rate Of UP2 Region is 16.44%

Major Affected Divisions:

Location Attrition

Ambala 3

Aurangabad 2

Chidana 4

Cuttak 2

Delhi 7

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3

2

4

2

7

Major Affected Divisions-Attrition

AmbalaAurangabadChidanaCuttakDelhi

.

8%17%

22%9%19%

26%

Tenure Wise

0-1 mnt 1.1-3 mnths 3.1-6 mnths

6.1-9 mnths 9.1-12 mnths 12 < mnths

Nature of exits

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Mode of exit Total

Involuntary -

Absconding 8

Termination 9

Involuntary total 17

Voluntary -

Resignation 21

Voluntary total 21

Grand total 38

Mode Of Exits

·        Absconding·        TerminationInvoluntary totalVoluntary -·        Resignation

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Now the data is being interpreted on

the basis of statement wise and dimension wise , so from here starts

the interpretation on basis of statements, data is also represented

graphically-

Statement 1-

What is the primary reason for leaving the job?

Analysis –

Prospective view as per classification of each trends.

Acciden

t/ Hea

lth

ASM's b

ehav

iour

Better

Opportunity

Distan

ce an

d salar

y

Family

Problem

Personal

reaso

n

Salar

y Gro

wth

Sacke

d0

1

2

3

4

5

6

7

Series1

Statement 2-

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What was the most satisfying about your job?

Analysis-

Policies are generally hardcore rule& regulations are partly part of organization rather

than the behavior consideration.

Statement 3-

71

102468

101214161820

Management Policies (+)Management Behaviour (-)

Did you receive enough training and support to do your

jo

Analysis-

The given % is applicable for training oriented programs as a

part of their opportunity.

Data of sacked employees are not interpreted.

Statement 4-

72

Yes No Sacked

-5

0

5

10

15

20

Series1

Did this company help you to fulfill your career goals?

Analysis –

Partly yes, because training is basically the enhancement of skills and

competency and lack of default crisis, so due to failure of this may lead to decline in

the training phenomenon.

Statement 5-

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Yes No Sacked

-4

-2

0

2

4

6

8

10

12

14

Series1

Did any company policy or procedure makes your job more difficult or easy?

Analysis-

Policy are hardly rules and regulation which an organization can follow but it

Makes all job perspective easy.

74

Yes No Sacked

-5

0

5

10

15

20

25

Series1

Statement 6-

Would you consider working again for this company in future?

Analysis-

Yes working again in this company for future correspondence can make out

More profile easy and flexible.

Statement 7-

75

1 2 3 4

-4

-2

0

2

4

6

8

10

12

14

16

Series1Series2

What would you suggest to management to make our organization a better place?

Analysis-

Their main issue quite about higher salary , as

salary can increase the conditions of working it

as a high profiled company.

Conclusion

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-8

-6

-4

-2

0

2

4

6

8

10

Series1Series2Series3

CHAPTER-5

FUCTIONAL ANALYSIS

OF

THE COMPANY

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The inferences drawn in the earlier chapter are analyzed as follows:

1. Marketing Department: Ayurvet Ltd. is having a clearly stated marketing

mix which helps to frame the pricing policies and perform the product related

activities. It focuses on its advertisement activities with proper care and

attention. The company sells its products through Veterinary Sales Officers

(VSOs).The sales agents are also having a process of selling to avoid any

confusion and failures. There is a clarified payment plan to be followed by the

sales agents which is disclosed to the customers. They are also having a layout

to calculate the total price of the units sold to a particular customer. Hence, it

is justified that the marketing department is performing all its activities

carefully which is good for the growth of the company.

2. HR Department: The Company is having a well established process of HR

planning, recruitment and selection, training and development, etc. It is using

an effective source mix for Recruitment. Induction programme is given proper

attention to make the new hires feel like the member of the Ayurvet family.

Training and Performance Appraisal are also considered to be the major part

of the organization as the goals of the organization can be achieved efficiently.

Ayurvet is also providing all the necessary benefits to its employees and is

continuously involved in the activities to maintain Industrial Relationships.

So, it can be concluded that the HR department of Ayurvet Ltd. is performing

all its major activities with proper attention and having a good base of

processes and policies.

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3. Production & Operations Department: The operations department is also

functioning as an important part of the organization. As the company is a

manufacturing concern so it is the most important part as it attracts the

customers. The operations department is providing the basic things to build the

properties which make it an important functional area of the organization.

4. Finance Department: The finance department is continuously involved in the

activities that are important for the growth of the company. It is the most

important part of the organization as it manages its money and ensures the

smooth functioning of the organization.

5.  IT Department: The IT department is providing communication support to

the organization which helps in information sharing. The functions it performs

make it the backbone of the entire business. It also helps the company to

communicate with people at manufacturing plants at Baddi and Chidana.

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CHAPTER-6

CONCLUSIONS

80

One of the biggest asset of any industry or organization is its manpower. As this

organization AYURVET deals in veterinary sector , so its main power is manpower to

launch new products , introduce to customers and even to attract the customers

towards our products .

Veterinary sector is facing high attrition rate because the rate at which its loosing its

employees is just the double of the rate at which they hire . in today’s scenario where

companies are fighting to combat global business competitions , and struggling to

survive , employee turnover becomes as double.

In today’s knowledge economy, managing human resources has been the most

difficult task undertaking the project at AYURVET have learned about company

induction, attrition and causes of attrition that would not been learned in books ,

because causes keeps on changing from organization to organization.

This is not possible for any organization to vanish the attrition rate for any

organization but human resources are taking steps to reduce the attrition rate. The

project captures the unique blend of causes of attrition for organizations especially in

Veterinary sector with reduction in dumb of employee turnover debt.

In the end of the project it lies the main cause of attrition in AYURVET in the form

of pie-charts and bar-graphs and I received in very professional manner from. The

learning experience I got during my entire project work will really help me in my

career throughout.

With this from here I am concluding the project report.

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BIBLIOGRAPHY

WEBSITES -

www.ayurvet.com

www.google.com

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