A MINI PROJECT REPORT ON

ORGANISATIONAL OPERATION AND FINANCIAL MANAGEMENT

OF

VISVESVARAYA IRON AND STEEL PLANT

(SAIL-VISP BHADRAVATHI)

Organizational Operation And Financial Management Of VISP

CONTENTS

Chapter-1

Introduction……………………………………………….…….….. 05

Objectives……………………………………………….…..………. 14

Research methodology…………………………………..……. 14

Limitations of the study…………………………………..…... 15

Chapter-2

Organization profile……………………………………………… 17

Awards of the company…………………………………….…. 20

Organization structure…………………………………………. 21

Departments………………………………………………………… 22

Chapter-3

Points collected during the visit……………………………. 24

Production process…………………………………………….…. 24 Finance department……………………………………………… 28

Chapter-4

SWOT analysis…………………………………………………….. 37 Findings ……………………………………………………………… 39

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Organizational Operation And Financial Management Of VISP

Conclusion…………………………………………………........... 40

Suggestions…………………………………………………………. 41

Chapter-5

List of reference……………………………………………........ 44

Bibliography………………………………………………………… 44

Chapter-1

Introduction

Objectives

Research methodology

Limitations of the study

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Organizational Operation And Financial Management Of VISP

Introduction:

The history of steel making in India can be traced back to 400 BC when the Greek emperors used recruit Indian archers for their army who used arrows tipped with steel. Many more evidences are there of Indians perfect knowledge of steel-making long before the advent of Christ. Archeological finds in Mesopotamia and Egypt testify to the fact that of iron and steel was known to mankind for more than six thousand years and that some of the best products were made in India. Among the widely - known relics is the iron pillar near Qutb Minar in Delhi. The pillar, built between 350 and 380 AD, did not rust so far an engineering marvel that baffles the scientist even today. Yet another engineering feat is the famous sun temple at konark in Orissa, built around 1200AD, where steel structural were used for the first time in the world.

These were the halcyon days when India flourished in all direction and when its prosperity was a matter of envy for the foreigners. But as ill luck would have it. India’s prosperity gave way to poverty after the advent of the foreign rule. India’s indigenous industry languished because of a deliberate policy of the colonial rulers to make country only a supplier of raw materials.

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Organizational Operation And Financial Management Of VISP

Steel Role plays a vital role on the development of any modern economy. The per capita consumption of steel is generally accepted as yardstick to measure the level of social-economic development and living standards of the people. As such, no developing country can afford to ignore the steel industry.

GROWTH AND DEVELOPMENT:

Indians known for art of smelting iron in early times e.g. Mehrauli Pillar. But

first I&S unit on modern lines was set up in 1830 at Porto-Nova (T.N) - not

succeeded.

Other attempts in second half of 19th century – same fate.

Real beginning in 1907 with setting up of TISCO Plant at Sakchi (now

Jamshedpur)

1919 – IISCO (Indian Iron and Steel Company) set up at Burnpur

1923 – Mysore Steel Works set up at Bhadravati. Now called Vishvesvaraya

Iron and Steel Works (VISW)

Rapid growth after independence:

The development of I&S industry was envisaged during first Five Year Plan

(FYP), but it was during Second FYP that three integrated steel projects were

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Organizational Operation And Financial Management Of VISP

started at Bhilai (with erstwhile USSR’s Technical and Financial support),

Rourkela (with Germany’s assistance) and Durgapur (with U.K’s assistance)

During Third FYP, Bokaro Steel Plant was started (Production started in 1972).

Three more steel plants planned during IV FYP to meet the requirement of

steel.

1. Salem (T.N.)

2. Vizag (A.P.)

3. Vijayanagar (Hospet district in Karnataka)

Coming up of SAIL in 1973 provided an umbrella corporation for managing

plants in public sector.

Slow Growth (1950-60)

o New PSUs had yet to start production

o Low capital availability

o Low installed capacity

o Low Demand for the finished products

Exponential growth (1960 – mid 90s)

o Started with coming up of Bhilai, Durgapur and Rourkela Plants

o Expansion of existing plants

o Industrialization took place at a faster rate, therefore higher demand for

steel

o Increased per capita consumption

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Organizational Operation And Financial Management Of VISP

Plateau Section (Stagnation) (Mid 90s – 2001)

o After liberalization, tertiary sector started becoming more important

o Losses of PSUs mounted high pressure on the plants themselves

o Competition from abroad.

Impact of Liberalization:

o After decades of state orchestrated industrial development, the

government going by the experience world over decided to launch the

process of liberalization and the steel sector was also opened to

international market and associated competition.

o With the start of new millennium, increase in production because of

infrastructure development and exports. Annual GR of Production 2001-02

– 3.7% and 2002-03 – 8%.

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Organizational Operation And Financial Management Of VISP

Steel Authority of India Limited:

Steel Authority of India Limited (SAIL) is one of the largest state-owned steel makers in India. With a turnover of Rs. 48,681 crore, the company is among the top five highest profit earning corporates of the country. It is a public sector undertaking which trades publicly in the market is wholly owned by Government of India and acts like an operating company. Incorporated on January 24, 1973, SAIL has more than 131,910 employees. The company's current chairman is C.S Verma. With an annual production of 13.5 million metric tons, SAIL is the 16th largest steel producer in the world.

Major plants owned by SAIL are located at Bhilai, Bokaro, Durgapur, Rourkela, Burnpur (near Asansol) and Salem. SAIL is a public sector company, owned and operated by the Government of India. According to a recent survey, SAIL is one of India's fastest growing Public Sector Units.

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Organizational Operation And Financial Management Of VISP

Major Units:

SAIL Integrated Steel Plants1. Rourkela Steel Plant (RSP) in Orissa set up with German collaboration

(The first integrated steel plant in the Public Sector in India, 1959)2. Bhilai Steel Plant (BSP) in Chhattisgarh set up with Soviet collaboration

(1959)

3. Durgapur Steel Plant (DSP) at Durgapur, West Bengal set up with British collaboration (1965)

4. Bokaro Steel Plant (BSL) in Jharkhand (1965) set up with Soviet collaboration (The Plant is hailed as the country’s first Swadeshi steel plant, built with maximum indigenous content in terms of equipment, material and know-how)

5. IISCO Steel Plant (ISP) at Burnpur, West Bengal

Special Steel Plants1. Steel Authority of India Limited (SAIL), Kanpur, Uttar Pradesh2. Alloy Steels Plants (ASP), Durgapur, West Bengal

3. Salem Steel Plant (SSP), Tamil Nadu

4. Visvesvaraya Iron and Steel Limited (VISL), at Bhadravathi, Karnataka

Subsidiaries1. Maharashtra Elektro-smelt Limited (MEL) in Maharashtra

Central Units

1. Centre for Engineering and Technology2. Research and development centre for iron and steel

3. Management Training Institute

4. SAIL safety organization

5. Raw materials division

6. Central Marketing Organization

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Organizational Operation And Financial Management Of VISP

7. SAIL consultancy organization[2]

Joint Ventures:

o NTPC SAIL Power Company Pvt. Ltd (NSPCL)

o Bokaro Power Supply Company Pvt. Limited (BPSCL)

o Mjunction Services Limited

o SAIL-Bansal Service Center Ltd

o Bhilai JP Cement Ltd

o Bokaro JP Cement Ltdo SAIL&MOIL Ferro Alloys (Pvt.) Limitedo S&T Mining Company Pvt. Ltdo International Coal Ventures Private Limited

Ownership and Management:

The Government of India owns about 86% of SAIL's equity and retains voting control of the Company. However, SAIL, by virtue of its `Maharatna’ status, enjoys significant operational and financial autonomy

Achievements:

SAIL was featured in the 2008 list of Forbes Global 2000 companies at position 647 [3].

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Organizational Operation And Financial Management Of VISP

National Institute of Personnel Management conferred the National Award on SAIL for Best

HR Practices 2008.

SAIL was adjudged as the top Indian company under the Iron and Steel Sector for the Dun &

Bradstreet – Rolta Corporate Awards 2008.

Golden Peacock Award for Combating Climate Change – 2008 for BSP, Occupational

Health and Safety – 2008 for BSL.

Other major steel producers

Aichi Steel Corporation, Japan Allegheny Technologies, United States

Angang Steel Company Limited, China

Tuwairqi Steel Mills Limited, Karachi[citation needed], Pakistan

AK Steel, formerly Armco, Middletown, Ohio

BlueScope Steel, primarily in Australia

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Organizational Operation And Financial Management Of VISP

China Metallurgical Group Corporation, China

Commercial Metals Company, United States

Companhia Siderúrgica Nacional, Brazil

Dongkuk Steel in Seoul, South Korea

Electrotherm India Ltd , in Gujarat, India

Essar Steel, India

Erdemir in Karadeniz Ereğli, Turkey

Beshay Steel , Egypt

EZDK, Egypt

Georgsmarienhütte GmbH, Germany

Gruppo Lucchini, Italy

Habas, Turkey

Hadeed, Saudia Arabia

Ilyich Mariupol steel and iron works, Ukraine

Japan Steel Works, Japan

Jindal Steel, India

JSW Steel[citation needed], India

Kobe Steel, Japan

KVS Ispat [citation needed], India

Libyan Iron and Steel Company, Libya

Mechel, Russia

Metalloinvest, Russia

Mitsui & Co., Japan

Nedstaal , Netherlands

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Organizational Operation And Financial Management Of VISP

Nisshin, Japan

Olympic Steel, United States

Outokumpu, based in Finland

Ovako [citation needed], Sweden & Finland

Pakistan Steel Mills Pakistan

Panzhihua, China

Rautaruukki, Finland

Reliance Steel & Aluminum Co. , United States

Salzgitter AG, Germany

Schnitzer Steel Industries, United States

SCM Holdings (divisions of), Ukraine

Sheffield Forgemasters[citation needed] in Sheffield, England

Sidetur, Venezuela

SSAB, Sweden

Steel Dynamics, United States

Ternium -- Hylsa in Mexico, Siderar in Argentina, & Sidor in Venezuela

Usiminas, Brazil

Vizag Steel, India

Voestalpine, Austria

Sahaviriya Steel Industries , Thailand

Bhushan Steel Limited , India

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Organizational Operation And Financial Management Of VISP

Objectives:

1. To know practically the organizational operation and the strategies used.

2. To study about the finance department and its process.

3. To know the strength, weakness, opportunities, and threat of the organization.

4. To study of balance sheet formation.

5. Profit and loss account calculation by considering different factors.

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Organizational Operation And Financial Management Of VISP

Research methodology:

In order to carry out the project I have to collect information regarding the project work concept to collect the data I am using two methods they are

1. Primary method2. Secondary method

Primary method:Primary method can be of different types but I am using interview

and discussion method. In this method I had conducted interviews & discussion with executives and non executives of the organization to collect the relevant data which are necessary to this project.

From primary method I have got the information regarding 1. Operating process2. About the different departments and their function3. Technology used4. Overall performance of the organization5. Financial operation of the organization

Secondary method:

The secondary data are collected from

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Organizational Operation And Financial Management Of VISP

1. Sail website2. From account books3. VISP magazines

Limitation of the organization study:

There are some limitation faced during the project

1. VISP is one of the big industry to study about it we require a lot of time2. The technical terms used are difficult to understand.

Chapter-2

Organization profile

Awards of the company

Organization structure

Departments

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Organizational Operation And Financial Management Of VISP

Organization profile:

The iron works were started by Nalvadi krishnaraja wodeyar, the king of Mysore, under the guidance of his diwan, sir.M.Visvesvaraya. In the year 1915 - 1916. It was first started in the name the Mysore iron and steel works. In 1962 the name was changed to Visvesvaraya iron and steel limited and the factory was converted into a government company jointly owned by the govt of India and govt of Karnataka. In 1989, it was taken over by the steel authority of India as a subsidiary entity and in 1998, VISL was merged into sail. The years 1918-1922 were spent in setting up the factory.

To start with, a wood distillation plant for manufacturing charcoal and blast furnace for melting iron were setup in the factory in 1923 with a capacity of 60 tones of pig iron per day.

High grade Hematite iron ore from Kemmangundi Mines in Chikmaglur

district (Karnataka): 40 km away

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Organizational Operation And Financial Management Of VISP

Coal not available in vicinity; earlier used locally available charcoal, but now

HEP from Sharavati Power Project.

Bhadra (vati) River passes through it. Water easily available. Also its valley

13 km wide providing enough land for expanding activities.

Well connected to Mangalore Port.

NH4 (part of Golden Quadrilateral) passes near to it. Well connected by

transport linkages. Lies on Biru - Shimoga railway line.

Engaged in producing steel for Defense purposes.

Milestones of VISP:

1918: construction work started for setting up a wood distillation plant of 200 tons per day one charcoal blast furnace of 60 tons per day.

1923: mining of iron ore in kemmanagundi iron ore mines, a captive mine of the company.

1938: cement plant started.

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Organizational Operation And Financial Management Of VISP

1976: name of the company changed to Visvesvaraya iron and steel Ltd., (VISL) on Feb. 16, 1976.

1989: VISL was taken over by SAIL as subsidiary company.

1998: VISL was merged with the SAIL on 28th DEC 1998.

Quality policy:Quality policy of VISL is as below

Providing products and services that meet or exceed customer’s expectations.

Continual improvement to our quality management system and processes. Fostering the professional development of our employees.

Area of operation:The Visvesvaraya iron and steel plant operates only in India. Marketing is

managed through branch offices located at Bangalore, Pune, Chennai, Ahmadabad, Mumbai, Nagpur and Kolkata. Head office is located at Bhadravathi, India.

Nature of business carried:

Visvesvaraya iron and steel plant is the manufacturer of iron and steel mainly alloys special steel produced in the country.

Ownership pattern:When, Indian govt decided to enter in the field of iron and steel production.

It is decided broadly not to run the firm as departmental undertaking. Although

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Organizational Operation And Financial Management Of VISP

initially, the steel project administration was directly under the ministry of central govt, Hindustan steel was formed as a private limited company in 1954.

The committee of public under taking reviewed the question of setting up a holding company for steel as a public sector which contribute surplus in the economy. Based on these consideration Steel Authority of India Limited was approved by the government in December 1972 with an authorized capital of Rs.2000crores, in 1978 SAIL was restructured as an operating company.

In India, there is a large potential to expand the steel market, which is currently amongst the lowest per capital consumption an areas of the world. This revolution is being spearheaded by SAIL, the company’s largest and the world’s 13th largest steel producer with a production with of 12 million tons of crude steel.

At present govt of India has 86% of ownership of SAIL, the co owns and operates nine manufacturing plant including two subsidiary co’s.

Awards of the company:

1988: National Safety Award. 2004: National Award 2004: Best Safety Man Award 2005: Safety Man of the Year Award. 2007: Sail Safety Award 2009: ISPATH Suraksha Award For Mine & Plant 2009: Vishwakarma Rasthriya Puraskar 2009: The Golden Peacock Occupational Health Safety Award 2009: Green Tech Safety Gold Award 2009: Jawaharlal Award 2009: Special Award for Revamping Auto Cutter Carriage Drive System In

CCM & SMS. 2009: Mines Safety Award 2010: Mines Environment & Mineral Conservation Award. 2010: B.A. Narayana Murthy Award

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Executive director

AGM TECH

AGM PUBLIC RELATION

DGM IA

GM WORKS GM MARKETING

GM PROJECTS

DGM-I/CF&A

GM OPERATION

EMPLOYEES

MGR CO-ORDN

EMPLOYEES

ASST GM OPERATIONS

EMPLOYEES

ASST GM PROJECT

EMPLOYEES

ASST GM EMPLOYEES

EMPLOYEES

AGM IA

EMPLOYEES

AGM-I/CF&A

Organizational Operation And Financial Management Of VISP

Organization structure of VISP:

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Organizational Operation And Financial Management Of VISP

Departments:

VISP consists of different departments for the smooth operating process. The main departments are,

Raw material section Blast furnace department Steel making shop department Primary mill department Bar mill department Finishing shop department Heat treatment shop department Forge plant department Machine shop department Oxygen plant department

These are some of the operating or production departments

Purchase department Finance department Production planning commission department Plant control department Marketing department

These are some of the administrative departments

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Organizational Operation And Financial Management Of VISP

Chapter-3

Points collected during the visit

Production process

Finance department

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Organizational Operation And Financial Management Of VISP

Points collected during the visit:

1. Raw material department: The main process of this department is to maintain the raw material and

passing the required materials to the concerned department.

The main raw materials are:

Iron ore Coke Raw dolomite Limestone River sand Sea sand Manganese Donate Red earth Burnt lime

Iron and Steel industry is a Weight Losing Industry (Material Index, M.I. >

1). All the raw materials of this industry – Coking Coal, Iron Ore, Limestone,

Dolamite, Mn are heavy and bulky

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Main components

Attitudes

Organizational Operation And Financial Management Of VISP

Location is governed by proximity to raw materials particularly coking coal

and Iron ore.

Localization either near coal and Iron ore or in between.

VISW is an exception, located far from main coal producing areas. Earlier it

used locally available charcoal and now using HEP from Sharavati Power

Project.

2. Blast furnace:

The purpose of a blast furnace is to chemically reduce and physically convert iron oxides into liquid iron called "hot metal". The blast furnace is a huge, steel stack lined with refractory brick, where iron ore, coke and limestone are dumped into the top, and preheated air is blown into the bottom. The raw materials require 6 to 8 hours to descend to the bottom of the furnace where they become the final product of liquid slag and liquid iron. These liquid products are drained from the furnace at regular intervals. The hot air that was blown into

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Organizational Operation And Financial Management Of VISP

the bottom of the furnace ascends to the top in 6 to 8 seconds after going through numerous chemical reactions

3. Steel making shop:

Molten iron is further refined at the Steel Melting Shop (SMS) to produce steel, which is hard and malleable.

At DSP, there are 3 converters (Basic Oxygen Furnace) of 110-130 tonnes each. The SMS also has a Vacuum Arc Degassing (VAD) unit for making special grades of steel.

A major portion of the steel is routed through the Continuous Casting Plant. Another major portion of the steel is taken to the teeming bay, where it is top poured into 8 tonne ingot moulds for making ingot steel. A portion of highly controlled steel is cast at the Special Casting Bay into fluted ingots and special quality blooms. Fluted ingots are bottom poured and are used for making wheel steel for DSP’s Wheel & Axle Plant. A portion of the liquid steel is also bottom poured to make axle ingots.

4.Rolling Mills:

Ingots weighing 8 tonnes each are heated in the soaking pits (numbering 20) for about 7 to 12 hours at around 1, 200 degrees centigrade and thereafter rolled in the 42” primary and the 32” secondary blooming mills. These are rolled further into different shapes and sizes in different finishing mills.

5.Forge plant:

After the CCM are INGOT process the cured iron are send to forge plant for the shaping here more than 300mm width is manufactured.

6.Finishing shop:

After the primary mill or bar mill the iron bar are send to the finishing where the defective parts are removed through grinding and cutting.

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Organizational Operation And Financial Management Of VISP

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Organizational Operation And Financial Management Of VISP

Finance department:

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DGM

ASST. MGRFIN (PA)

MGR

FIN (A/C’S)

MGRFIN (PA)

ASST. MGR

FIN (ADV)

SR. MGRFIN (P&E)

ASST. MGRFIN (P&E)

JR. MGR(FIN)

SR. MGRFIN (COST)

JR.MGRFIN (COST)

MGR-FINPUNE

MGR-FIN(SA&CE)

MGR-FINCHENNAI

ASST. MGRFIN (SA)

JR. MGRFIN (CE)

MGRFIN (CA)

ASST. MGRFIN (CASH)

ASST. MGRFIN (PUR A/C’S)

Organizational Operation And Financial Management Of VISP

As for as finance department is concerned it is divided into different sub departments, like

Cost accounting Purchase accounts Sales account Central exercise

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Organizational Operation And Financial Management Of VISP

Cash department Pay and establishment

Cost accounts:

In management accounting, cost accounting establishes budget and actual cost of operations, processes, departments or product and the analysis of variances, profitability or social use of funds. Managers use cost accounting to support decision-making to cut a company's costs and improve profitability.

Elements of cost:

Material(Material is a very important part of business) o Direct materialo Indirect material

Labor o Direct laboro Indirect labor

Overhead

o A. Indirect material

o B. Indirect labor

(In some companies, machine cost is segregated form overhead and reported as a separate element)

They are grouped further based on their functions as,

1. Production or works overheads 2. Administration overheads

3. Selling overheads

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Organizational Operation And Financial Management Of VISP

4. Distribution overheads

Classification of costs:

Classification of cost means, the grouping of costs according to their common characteristics. The important ways of classification of costs are:

By nature or element: materials, labor, expenses By functions: production, selling, distribution, administration, R&D,

development,

As direct and indirect

By variability: fixed, variable, semi-variable

By controllability: controllable, uncontrollable

By normality: normal, abnormal

Purchase accounts:

Purchase accounting is mainly involved in the process of maintaining the accounts of payment made for the purchase of raw materials or any other assets.

Sales account:

Sales accounting is the maintenance of the sales record for the sales made by the company.

Central excise:

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Organizational Operation And Financial Management Of VISP

The Central Excise duty is levied in terms of the Central Excise Act, 1944 and the rates of duty, ad valorem (on value) or specific, are prescribed under the Schedule I and II of the Central Excise Tariff Act, 1985. The taxable event under the Central Excise law is ‘manufacture / production’ and the liability of Central Excise duty arises as soon as the goods are manufactured or produced. This department looks after that the exercise duty imposed on the customer should not be a burden on them.

Cash department:

The main purpose of the cash department is to maintain all the cash transactions of the company it may be inlet or outlet.

Pay & establishment:

This department is to look after the payment of salary, bonus, production bonus, performance rating to the employees of the company.

Summary of latest annual report

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Organizational Operation And Financial Management Of VISP

Balance sheet:

The total fixed assets after deducting the depreciation is Rs. 202.36 croers and no reserves and surplus made in the year.

Application made like this in investments Rs. 0.00 croers, net fixed assets Rs. 90.41 crores total current assets Rs. 561.42 crores current liability Rs. 109.11 crores and provision made is 195.27 crores. Shows the balance sheet.

Profit & loss account:

The total expenses Rs. 758.29 crores the profit before tax is 749.72 and the profit after tax is Rs. 149.29 crores shows profit and loss account.

STEEL AUTHORITY OF IN DIA LIMITED/VISL, BHADRAVATHIBALANCE SHEET AS AT 31 ST MARCH, 2010

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Organizational Operation And Financial Management Of VISP

Schedule no

31-mar-2010

31-mar-2009

Source of fund:Loans fundsSecured loanUnsecured loansDeferred taxLiability (net)Inter unit account

Applications of funds:Fixed assetsGross blockLess: deprNet blockCapital work in progressCurrent assets loans & advancesInventoriesSundry debtorsCash and bank balanceInterest receivable?AccruedLoans & advances

Less: current liabilities & provisionsCurrent liabilities provisions

Net current assetsMiscellaneousExpenditureProfit & loss a/cDebit balanceInter unit a/c

1.1

1.2

1.3

1.4

1.51.61.71.81.9

1.101.11

1.12

1.13

00

355.39214.97140.4217.52

343.2895.2622.760.6127.62489.53

128.78136.77265.55

0

0

1429.691429.69

157.94

223.98

0.00915.01

132.76

12.110

292.77202.3690.4148.43

448.5782.884.330.0025.74561.42

109.11195.27304.38

12.11

0

1299.471311.58

138.84

257.04

0.00814.33

101.37

1429.69 1311.58

Different accountability measures:

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Organizational Operation And Financial Management Of VISP

Accountability measures are the controlling measures adopted in VISP for internal control and smooth running of dept. activities, by conducting different types of audits;

Internal audit Cross plant audit Corporate audit Statutory audit Govt. audit Central excise audit State VAT audit Vigilance audit

o Internal audit is conducted by internal staff member by time to time.o Cross plant internal audit are conducted by the same system plant

audit people from time to timeo Corporate audit is conducted by the corporate office staff yearly onceo Statutory audit are conducted by the staff according to CAG

standardso Govt. audit are conducted by only CAG staff according to their rules

and regulationso Central excise audit are conducted by the central excise department

staffo State VAT audit are conducted by VAT staffo Vigilance audit is conducted by the staffs of VISP only if any

malpractice is found

Government Policy:

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Organizational Operation And Financial Management Of VISP

Trickle down hypothesis for balanced regional development guided

tremendously the location of I&S industry in the backward regions.

Policy of developing Growth Centers & Growth Poles with I&S industry as

their core also influenced its location in India.

Political lobbying at times influences greatly its location.

VISW Plant was set up to fulfill Defense requirements.

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Organizational Operation And Financial Management Of VISP

Chapter-4

SWOT analysis

Findings

Conclusion

Suggestions

SWOT analysis of the VISP:

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Organizational Operation And Financial Management Of VISP

SWOT analysis gives us a detail picture of the organization strength, weakness, opportunity, threat. These are very essential for any organization to know its ability in the field of:

Sales Marketing Capacity Working capital Budget allocation Size and segmentation Growth pattern and maturity International dimensions New technologies etc;

Strength:

A strong Team work Committed & skilled labors Efficient management units Well equipped lab facilities Known as quality suppliers of alloy & special steel Certified with ISO 9002 certificate by M/S R W TUV Germany

Weakness:

Old & traditional method in production process Being a public sector emphasis is more on welfare measure rather that

productivity growth of the organization Employees of age group more than 53 are more in numbers

Opportunities:

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Organizational Operation And Financial Management Of VISP

Growing market for iron & steel Competitive environment calls for improvement and increase in

productivity Cutting cost by making sure of new technology Goodwill of the company is very strong

Threats:

The other manufactures may sell their products at low price with their advanced technology

Emerging new companies to the market Raise in the cost of raw materials.

Findings:

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Organizational Operation And Financial Management Of VISP

Industry should face with changing technology, it is very difficult to stay

ahead in present competitive environment in terms of quality commercial viability

and demanding ecological factors.

1. Decreasing production level

2. Decreasing demand.

3. Employee of age group of 50 and above are more in numbers

4. Competing with private industries going harder day by day.

5. Very limited marketing area.

6. No involvement of employees in the decision making process.

7. Traditional method is still in routine.

8. Entry of private sector in the market.

Conclusion:

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Organizational Operation And Financial Management Of VISP

From doing the project we have got a great experience of real situation of

an organization. It help to know about Indian steel industries and Visvesvaraya

iron and steel industries process of operation and its finance department

operations. Which is very similar to our theory but very complicated and sensitive

in practical part.

Through this project I came to know about the strength, weakness,

opportunites, threats of the steel Industries, and regarding the govt policies and

the future aspect of these companies.

Suggestions:

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Organizational Operation And Financial Management Of VISP

1. As VISL is a very large company and the required man power is also more so

it should concentrate more on his man power.

2. Today’s word is fully based on technology it is very necessary to run

according to time. VISL has to concentrate more on his technical factors.

3. As VISL is of large company it as to concentrate more on its marketing also

because if production is the main organ, then marketing is its life blood.

4. It as to concentrate on reducing of its fixed cost also.

5. It as to find more alternatives of availability of raw materials.

6. It has to concentrate more on its contract labors

7. SAIL should give more attention towards the VISP to regain its original

position.

8. As the plant location is very plan fully made by Sir. M. Visvesvaraya, we

should try to protect it and take it to a standard level.

FUTURE PROSPECTS OF STEEL INDUSTRY:

The recent upswing in the international steel market has been a booster

dose for Indian steel industry but the real party can begin only when the

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Organizational Operation And Financial Management Of VISP

domestic market offers right environment and opens up avenues for long-

term sustenance and growth.

The potential for growth of this sector is enormous. This can be gauged

from the fact that the per capita consumption of steel is still around 29 kg

whereas the world average is 150 kg. Even to equal the world average, with

its population over a billion, will have to touch 150 million tones (present

consumption 29 million tones).

Generation of such kind of demand is dependent on health and rate of

growth of other sectors of economy like roads, power, railways, ports,

drinking water, housing and manufacturing.

New Road Projects estimated to cover around 10,000 kms, four laning of

existing roads is also planned. These will be a good source of new demand

for steel.

As the country will need more Greenfield capacities in the coming years,

the steel sector can hope to get the required impetus for steady growth.

Track renewal plans of railways for about 35000 kms. This will boost the

demand for steel in a major way. More high-speed trains, new demand for

coaches and wagons, and building of underground railway system will help

boost its demand.

GIRISH.B.P - 10 -

Organizational Operation And Financial Management Of VISP

Chapter-5

List of reference

Bibliography

List of reference:

Business policy and strategy formulation

GIRISH.B.P - 10 -

Organizational Operation And Financial Management Of VISP

o By, R. Srinivasan Finance management theory and practice

o By, Prasanna Chandra Sail magazines, iron and steel news

Bibliography:

Previous Project report

By, Harish. R

Student of Kuvempu University

Websites:

Wikipedia

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Organizational Operation And Financial Management Of VISP

GIRISH.B.P - 10 -