“BHARAT HEAVY ELECTRICALS LIMITED
&
THE STUDY OF MARKET POTENTIAL FOR CONTROL EQUIPMENTS AT
BHEL”
Dissertation Submitted to the ALAGAPPA UNIVERSITY in partial fulfillment of the
requirements for the award of the Degree of
MASTER OF BUSINESS ADMINISTRATION
SUBMITTED BY
CHAKRAPANI AWASTHI
Enrollment No:-083173871
Project Guide
Mr.-Manohar Ramesh MBA
NIILM School of Business
Bangalore-560025
DIRECTORATE OF DISTANCE EDUCATION
ALAGAPPA UNIVERSITY
KARAIKUDI – 630 003
JUNE 2010
1
DECLARATION
I hereby declare that the dissertation market potential for control equipment’s at
BHELsubmitted for the MBA (General) degree is my original work and the dissertation has not
formed the basis for the award of any Degree, Associate Ship, Fellowship or any other similar
titles.
Place:-Bangalore
Date:-30 June 2010 Signature of the Student
2
GUIDE CERTIFICATE
This is to certify that the dissertation entitled “THE STUDY OF MARKET POTENTIAL FOR
CONTROL EQUIPMENTS AT BHEL” is a bonafied research work carried out by
CHAKRAPANI AWASTHI & ENROLLEMENT NO. 083173871 of MBA (General) in
partial fulfillment of the requirements for the award of the degree of Master of Business
Administration ( General ) and that the dissertation has not found the basis for the award
previously of any Degree, Diploma, Associate ship, Fellowship or any other similar title.
Place: Signature of the Guide
Date: Manohar Ramesh
Head – Corporate Relations & Placement
NSB Bangalore
3
ACKNOWLEDGEMENT
It’s my special privilege to extend words of thanks to all of those who have helped me and
encouraged me in completing the internship successfully.
I sincerely thank Mr. Manohar Ramesh, Head CRPC – NIILM School of Business, for giving me
an opportunity to take up this research. I would like to express my profound sense of gratitude to
Mrs. Sasmita Bebortha, Campus Head– NIILM School of Business for providing me support to
conduct this research.
I feel extremely privileged that I completed my project under the guidance of Prof. Krishna K.
Havaldar, who spent his quality time even during his busy schedule to make me understand the
each and every aspect about the procedure of carrying out research study and guiding me
throughout the project.
I owe a special debt of gratitude to Mr. G. Kalyana Sundaram, Senior Manager HRD who has
been kind enough to permit me to take up internship study at BHEL-EDN. My warm thanks to
Mr. A. T. Seralathan, Manager Marketing CE, Mr. G. Senthil Kumar, Deputy General
Manager Marketing CE and Mr. Shailesh Kumar Singh, for their kind co-operation.
I also thank Prof. B. Suresh and Prof. Rajasekhar, program managers for their constant
support and well wishes during the project.
My gratitude will not be complete without thanking God and I am grateful to my beloved parents
and friends who have been a constant source of inspiration.
Chakrapani Awasthi
4
TABLE OF CONTENTS
Sl. No Topics Page no
Introduction
1 Industry profile 9
2 Company Profile 12
Functional Analysis
3 Production Department 33
4 Marketing & commercial department 38
5 Human resources department 41
6 Finance department 60
7 Quality Department 70
8 MIS 76
9 Factory service department 78
10 Summary of analysis & inference 81
PART-B Study of the Problem
11 Research design 84
12 Methodology 85
13 Limitation of the study 86
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14 Summary of findings 91
15 Inference 92
16 Conclusion 94
Table
No.PARTICULARS Page No.
17 My Learning 95
18 Bibliography 96
19 Annexure 97
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LIST OF TABLES
Si
No. Particulars
Page
No.
1 Major Manufacturing plants & Their products 16
2 No of customers purchased the control equipment’s 86
3 Dependence of customer on supplier 87
4 Awareness about BHEL 87
5 Opinion about BHEL 89
6 No. Of potential buyers 90
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LIST OF CHARTS
Sl No. Particulars Page No.
1 Shares holders pattern 18
2 Market shares of BHEL 18
3 BHEL’s role in power sector 19
4 Organisation chart for P&A 42
5 Finance Department 61
6 Turnover for last five years,PBT 65
7 Performance and highlight 67
8 Quality Department 70
9 CII model for TQM(BHEL) 73
10 MIS 78
11 Business activity flow chart 80
12 No. Of customers purchased the control equipment’s 86
13 Awareness about BHEL 88
14 Opinion about BHEL 89
15 No.of Potential Buyers 90
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INDUSTRY PROFILE
The critical role played by the power industry in the economic progress of a country has to be
emphasized. A self sufficient power industry is vital for a nation to achieve economic stability.
Indian Power Industry
(A) Before Independence
The British controlled the Indian power industry firmly before Independence. The then legal and
policy framework was conducive to private ownership, with not much regulation with regard to
operational safety.
(B) Post Independence
Immediately after Independence, the country was faced with capacity restraint. India adopted a
socialist structure for economic growth and all the major industries were controlled by public
sector enterprises. By 1970's India had nationalized most of its energy assets, due to its
commitment to social goals. By the late 1980's the Indian economy felt the strain of the socialist
agenda followed since independence. Faced with a serious deterioration in public finance and
balance of payment crisis, the Union government as part of its policy of economic liberalization
allowed greater investment by private sector in the power industry.
Power
Constitutional Position
Power as a matter of legislative and executive competence, falls in the Concurrent List (List III
of the Seventh Schedule to the Constitution of India).Both the Parliament and state legislatures
9
have the rights to pass laws on the matter and any law passed by the Parliament overrides the
existing state laws unless
Consolidate and rationalize existing laws.
To address the issues of developing industry including regulation, power trading, non
discriminatory open access, choice of dispensing with vertically integrated state
enterprises and encouraging private enterprise.
Future Trends:
According to experts the private sector would play a greater role in power generation and
foreign investments would increase considerable in his sector.
The government of India’s Hydrocarbon vision 2025 gives in details the guidelines for
the policies in India for the next 25 years to attract investment in exploration, production,
refining and distribution of petroleum products.
Analysis of Indian power sector:
India had been traditionally depending on thermal power as a major source of power generation ,
which constitutes about 65% of current capacity . Balance is contributed by Hydel power (26%),
Nuclear (3 %) and Renewable energy (6%).Over 87% of the current installed capacity in the
country is by the government, and with the state governments having lion’s a share of over 52%
and the balance by central (federal) government. Due to the initiative of government of India to
encourage Public Private Partnerships in power sector, share of private companies has gone up to
steadily to MW, about 13 % of the installed capacity. This report covers the overall industry
scenario, demand & supply, growth drivers, critical success factors for the industry. It also deals
with investment opportunities in the sector and an outlook.
'Indian Power Sector Analysis” focuses on the growing marketplace for power sector in India. It
thoroughly investigates the current market trends, evolving markets, and growth prospects for the
Indian power industry. It will help the client to analyze the driving forces and leading-edge
opportunities critical to the success of the power industry.
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The research study analyzes the prevailing scenario in the Indian power sector along with the
existing policy and regulatory framework. It tracks the growth and performance of the Indian
power sector, the ongoing reform initiatives and offers statistical updates on power generation,
transmission and distribution, along with a rational future forecast.
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Key Findings:
- More than 64% of India’s total installed capacity is contributed by thermal power. Significant
jump in unit size and steam parameters will result in higher efficiencies and better economics for
the Indian power sector.
- Western region accounts for largest share (30.09%) of the installed power in India followed by
Southern region with 27.76%.
- Unbalanced growth remains the cause of concern for the Indian power sector. Only about 56%
of households have access to electricity, with the rural access being 44% and urban access about
82%.
- Southern region remains the dominant region in renewable energy source accounting for more
than 57% of the total renewable energy installed capacity.
Key Players
These major players currently operating in the Indian power sector such as National Thermal
Power Corporation Limited, Nuclear Power Corporation of India Limited, North Eastern Electric
Power Corporation Limited, Power Grid Corporation of India, Tata Power, etc.
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BHEL – An Overview
BHEL is the largest engineering and manufacture enterprise in India in the energy
related/infrastructure sector today. BHEL has built over the years ,a robust domestic market
position by becoming the largest supplier of power plant equipment in India , and by
developing strong market presence in select segments of the industrial sector and the
Railways. BHEL was established more than 40years ago ushering in the indigenous Heavy
Electrical Equipment industry in India , a dream which has been more than realized with
a well recognized track record of performance. It has been earning profits continuously since
1971-72. BHEL has the proud privilege of having been selected as one of the
‘NAVARATNA’ PSU by the government of India.
BHEL manufactures over 180 products under 30 major product groups and caters to core
sector of the Indian Economy viz.,Power Generation and Transmission , Industry ,
Transportation , Renewable Energy , Defense , etc. The wide network of BHEL’s 14
manufacturing divisions , 4 power sector regional centers , 8 service centers , 15 regional
offices and a large number of Project Sites spread all over India and abroad enables the
Company to promptly serve its customers and provide them with suitable products ,
systems and services-efficiently and at competitive prices. The quality & reliability of its
products is due to the emphasis on design, engineering and manufacturing to international
standards by acquiring and adapting some of the best technologies from leading companies in the
world, together with technologies developed in its own R&D centers.
BHEL has attained ISO 9001 certificate for quality management and all the
manufacturing units/divisions of BHEL have been upgraded to the latest ISO-9001:2000
version. All the major units/division of BHEL have been awarded ISO-14001 certificate for
Environmental Management Systems and OHSAS-18001 certification for Occupational
Health and Safety Management Systems. BHEL was the first Public Sector Company in
the country to win the coveted ‘PRIZE’ for its Haridwar unit under the CII Exim Award
forbusiness excellence, as per the globally recognized model of European Foundation for
Quality Management.
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The company received EEPC’s Top Exports for the seventeenth year in succession. It
has also won the SCOPE Meritorious Award for R&D and Innovation 2005-06 for
commendable contribution in the area of R&D and Innovation.
BHEL has:
Installed equipment for over 90,000 MW of power generation - for Utilities, Captive
and Industrial users.
Supplied over 2,00,000 MVA transformer capacity and sustained equipment
operating in Transmission & Distribution network up to 400 KV - AC & DC.
Supplied over 25,000 Motors with Drive Control System to Power projects,
Petrochemicals, Refineries, Steel, Aluminum, Fertilizer, Cement plants, etc.
Supplied Traction electrics and AC/DC locos to power over 12,000 Kms Railway
network. Supplied over one million Valves to Power Plants and other Industries.
BHEL's operations are organized around three business sectors, namely Power,
Industry including Transmission, Transportation, Telecommunication, & Renewable Energy
and Overseas Business. This enables BHEL to have a strong customer orientation, to be
sensitive to his needs and respond quickly to the changes in the market
The greatest strength of BHEL is its highly skilled and committed 47,000 employees. Every
employee is given an equal opportunity to develop himself and improve his position. Continuous
training and retraining, career planning, a positive work culture and participative style of
management have engendered development of a committed and motivated work force leading to
enhanced productivity and higher levels of quality.
BHEL has a major presence in the domestic power market and accounts for 64% of the
nations installed power generation capacity , thus making a significant contribution to the
growth and development of the country’s economy over the years. It has had consistent
track record of growth, performance and profitability and has been reported by the World Bank
as being “one of the most efficient enterprises in the industrial sector at par with international
standards of efficiency”.
14
BHEL ‘s Contribution to various Core Sectors:
Power Transmission Sector:
BHEL is a leader in the field of power transmission in India with a wide range of
transmission systems and products. BHEL manufactured Transmission Products have a
proven track record in India and abroad. It also provides turnkey solutions Utilities and
Industries. Substations and Reactive Power Compensation installations set up by BHEL are
in operation all over the country. It has executed HVDC project in India with major
HVDC products viz., converter transformers , smoothing reactors , thermistor valves and
filter capacitors manufactured and supplied from its works.
Industry Sector:
Since its inception in 1982 , the Industry Sector business has grown at an impressive
rate and contributes significantly to BHEL’s turnover. It supplies all major equipment for
industries: AC/DC machine, solar photovoltaic systems and heating systems ,electrostatic
precipitators, fabric filters, etc. BHEL also provides solution for water management
systems, coal & ash handling plants.
The industries which BHEL serves include Steel, Aluminum , Fertilizer, Refinery ,Oil
&Gas Exploration ;Production & Pipelines , Petrochemical ,Chemicals ,Automobiles, Cement,
Sugar ,Paper, Mining, Textiles etc.
Transportation Sector:
In the transportation field , BHEL’s product range covers : Mainline AC locomotives,
AC/DC dual-voltage locomotives, diesel-electric shunting locomotives, EMU Coaches, diesel
power car and diesel-electric locomotives, track machines and solutions for Urban
Transportation Systems ,including Electric Trolley Buses, LRT & MRTs. Most of the
trains operated by Indian Railways are equipped with traction equipment and controls
manufactured and supplied by BHEL.
15
BHEL IN INDIA :
Registered office & Corporate Headquarters : NEW DELHI
Corporate Research& development Division : HYDERABAB
Over 100 Power Plant Project Sites all over India
BHEL has 14 Manufacturing units in India:
BANGALORE
BHOPAL
GOINDWAL
HARIDWAR
HYDERABAD
JAGDISHPUR
JHANSI
RANIPET
RUDRAPUR
TIRUCHIRAPPALLI
BHEL Service Centers:
CHANDIGARH
KOLKATA
NAGAPUR
NOIDA
PATNA
SECUNDERABAD
VADODARA
VARNASI
BHEL Regional Offices:
NOIDA (NORTHERN REGION)
KOLKATA (EASTERN REGION)
NAGPUR (WESTERN REGION)
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MAJOR MANUFACTURING PLANTS AND THEIR
PRODUCTS
17
MANUFACTURING PLANT
PROFILE
PRODUCT
HEP, BHOPAL Hydro sets, Nuclear turbines, Thermal sets (110
MW), AC Motors & large Electric Motors, Power
Transformers, Traction Machine & Controls for
traction & industrial applications, Diesel Generating
sets, Switchgear, Capacitors, Industrial turbines.
TP, JHANSI Power transformers (less than 220 KV) freight Loco
transformers, Instrument transformers, AC Locos
Diesel Electric Shutters etc.
HPEP, HYDERABAD Thermal sets, Gas turbine generator sets combined
cycle/Cogan plants, Industrial TG sets, Compressors,
Oil Rigs, mills, SF & MOCB switchgear, Heat
exchanger.
HEEP, HARDWAR Casting and forging for thermal/Hydro sets, motors
defense etc. Special facilities like 9000T press For
forgings, electric arc furnaces for melting steel, etc.
SSTP, TRICHY Seamless steel tubes.
BAP, RANIPET Boiler auxiliary fans, Electrostatic Preheaters.
EDN, BAGALORE Variable speed drives, programmable. Login and
digital controllers, Power devices, meters,
photovoltaic/solar – Panels, simulators, etc.
EPD, BANGALORE Insulators: solid core, bushings, pin.
BOARD OF DIRECTORS:
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Shri K. Ravi Kumar Chairman & Managing Director
Shri Dr. Surajit Mitra Director
Shri Dr. Sutanu Behuria Director
Shri Sanjay M. Dadlika Director
Shri Ashok K. Aggarwal Director
Shri Shekhar Datta Director
Shri Manish Gupta Director
Shri Madhukar Director
Shri S. Ravi Director
Shri C.S.Verma Director (Finance)
Shri C.P.Singh Director (E, R&D)
Shri Anil Sachdev Director (HR)
Shri B.P.Rao Director (IS&P)
Shri N.K. Sinha Company Secretary
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SHAREHOLDING PATTERN:
MARKET SHARE :
20
BHEL ‘S ROLE IN INDIAN POWER SECTOR
BHEL ELECTRONIC DIVISION -A PROFILE
The Electronics Division (EDN) of BHEL, situated at Bangalore, was
formed in 1976,mainly to establish a strong base in the areas of
power and control electronics, to supplement the company’s pioneering
efforts in power generation and transmission equipment manufacturing.
The division came into being when BHEL took over the Radio and
Electricals Manufacturing Company (RAMCO), which formally merged
with BHEL-EDN in 1980. Making a modest beginning with a turnover
of Rs.3 crore in 1976-77, the unit was poised to record a turnover of
over Rs.500 crore. The growth is amply reflected in the fact that most
of the power plants and process industries in the country are equipped
with products and systems made by BHEL-EDN.
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It has established itself as a market leader in new generation Power
Plant Automation System. Besides manufacturing and supplying state-of-
the-art control and automation equipment and systems for power plants
and process industries, the Electronics Division has also emerged as a
leading player in the fields of Power Transmission and Distribution,
Industry, Transportation and Renewable energy sources.
BHEL-EDN has been successful in meeting the demanding
requirements of International markets in terms of technical
specifications and qualities, establishing references in over 25 countries
by installation of Automation, Semiconductors and Photovoltaic
Systems.
Focus on achieving customer delight through product excellence,
adherence to quality, relentless efforts and unwavering commitment to
in-house solutions, along with Technical collaborations with international
leaders, have been the main factors contributing to the units rapid
growth and success.
In recognition of its commitment to the quality systems and
procedures, the unit has been certified for ISO 9001. It is also the first
Electronics Industry in Bangalore to get ISO 14001 Environment
Management System Certification and OHSAS 18001 Certification.
In its commitment towards integrity, confidentiality, availability and
security of information, EDN has been certified for ISO/IEC
27001:2005, Information Security Management System (ISMS) Standard.
In addition to their comprehensive products profile a number of new
technology areas have been earmarked for future developments. Prominent
among them are power and control electronics for traction application,
energy management systems, training simulators for defense applications,
electronic energy meters etc.
BHEL’s vision envisages further growth for EDN, transforming it into
a world class enterprise, providing comprehensive solutions to
22
customers while exploring new frontiers in software and hardware
application to fulfill the growing needs and expectations of the global
market. The company has already joined the United Nations “Global
Compact” and has committed to support the set of core values
enshrined in its ten principles in the areas of human rights, labor
standards, environment and anti-corruption.
BHEL EDN comprises an excellent and experienced group of 1950
employees who are classified into executives, supervisors, artisans and who
are further classified into skilled, semi skilled and unskilled workers.
VISION
A World Class Engineering Enterprise .Committed to Enhancing
Stakeholder Value.
MISSION:
To be an Indian Multinational Engineering .Enterprise providing Total
Business Solutions. Through Quality Products , Systems and Services in
the fields of Energy, Industry. Transportation, Infrastructure, and other
potential areas.
VALUES:
Zeal to excel and Zest for Change.
Integrity and Fairness in all Matters.
Respect for Dignity and Potential of Individuals.
Strict Adherence to Commitments.
Ensure Speed of Response.
Foster Learning , Creativity and Team work.
Loyalty and Pride in the Company
CONCERN FOR SOCIETY
Striving for the growth of the nation, BHEL-Electronics Division has always
been contributing for the upliftment of the poorer and backward sections of
23
the society. Three villages near Bangalore have been adopted by BHEL and
a number of social welfare programmes like solar electricity, low cost
housing, educational, medical and drinking water facilities have been
implemented resulting in remarkable transformation in the living conditions
of the villagers.
OBJECTIVES
BHEL’s objectives for the current financial year are to achieve 7395MW
power plant equipment’s which is planned and synchronization comprising
6983MW Thermal and 412 MW in Hydro. Similarly 6900MW have been
planned and trial operation completion during 2009-10 comprising 6488MW
Thermal and 412MW of Hydro. In addition BHEL also planning to
commission 260 MW of lift irrigation and other small Hydro projects.
In line with the capacity and capability enhancement strategy adopted by the
company, the manufacturing capacity expansion from 10000MW per annum
to 15000MW per annum is proceeding apace and plans are afoot to hike this
further to 20000MW by 2011-12.
THE MAJOR MILE STONES :
1976 : Take over of Remco.
1977 : Supply of first control equipment product.
1983 : Supply of first Photovoltaic Panel.
1985 : Supply of steam turbine control.
1986 : Entry into telecom with first EPABX supply.
1987 : Entry into HVDC controls for Rihand-Delhi.
: Supply of first AC drive system for ID fan control in
500MW power plant.
1988 : Supply of Procontrol systems for C & I.
1992:Entry into Defense Electronics business.
1994 : Supply of Gas Turbine Controls.
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1995 : Supply of MAX-L and MAX-XL exchanges.
2000 : Supply of first power converter for 3PH 6000 HP LOCOS.
2001 : Supply of first control electronics for 3PH 6000 HP
LOCOS.
: Supply of first converter for 3PH AC / DC EMU
: Introduction of first high power SFC for lift irrigation &
pumped
storage scheme
2002 : Introduction of new technology for C & I : maxDNA
2003 : First PADO system commissioned at 500 MW at
Simhadri
: ERP implementation using SAP package
2004 : First unified maxDNA based C & I system commissioned
for 500MW at
Ramagundam
: 3MW Photovoltaic production achieved
2005 : First 500MW Nuclear Turbine at Tarapur unit 4
commissioned with EDN
Supplied TG controls.
: INSAT 4A launched by ISRO on 22nd December 2005
with Batteries and
Solar Panels of BHEL make
PRODUCT PROFILE
CONTROL EQUIPMENT:
Power Plant Automation (DCS)
Industry Automation
AC & DC Drives
Power Supplies
25
Excitation Systems
Reactive Power Management Systems (RPM) like SVC
SCADA
PADO (Performance Analysis, Diagnostics & Optimization)
SEMICONDUCTORS & PHOTOVOLTIC SYSTEMS:
Power Semiconductor Devices
Solar Cells, PV Modules & PV Systems
Space Grand Solar Panels & Batteries
DEFENCE ELECTRONICS:
Infantry Weapon Effects Simulator System (IWESS)
Small Arms Training Simulator (SATS)
SIMFIRE
Integrated Platform Management System (IPMS)
Ship Control System
SERVICE OFFERED:
Harmonic Measurement and Analysis
System study for Reactive Power Compensation
Erection and commissioning by highly experienced team of
Engineers
In -house expertise for efficient Service-After-Sales
Assured Supply of Spares
A highly competent team to respond to Customers’ emergency
needs
Total Solutions to Renovation and Modernization requirements
Concept to Commissioning solution for large size Solar Power
Plants
A BRIEF OVER-VIEW OF THE PRODUCTS
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POWER PLANT AUTOMATION
Any power plant is a mini industrial cosmos with a variety of control
elements with intricate inter-relationships. BHEL-EDN offers a large variety
of control equipments for power stations ranging from simple control
systems to single push button automation for power plants of any size.
Digital automation systems for controlling steam/water turbines, boilers and
generators employing Distributed Control Systems (DCS) are amongst the
products that are offered. The systems for power plants include CRT-based
MAN-MACHINE interface and computer based information management
and optimization systems.
BHEL-EDN also has unified DCS solution for the entire power plant
comprising of boiler, turbine balance of plant (BOP) bringing uniformity in
hardware, software, and operation methodology as well as spares inventory
to the user.
Amongst the individual control systems for steam generators manufactured
by BHEL-EDN are:
-Burner management systems
-Secondary air dampener systems
-Soot blower control systems &
-Bypass control systems
-BHEL-EDN manufactures integrated control and instrumentation
systems capable of monitoring and controlling the critical
parameters of a steam turbine to high degree of accuracy. The
system is designed for automatic safe start up and shut down, as
well as efficient operation during normal and abnormal conditions.
Balance of plant (BOP) automation comprises of:
- Control
- Monitoring and information system including regulatory controls.
27
- Co-ordinate controls
- Sequential controls
- Interlocks and protections
- Alarm annunciation
- Operator interface units as well as performance calculation for the
entire power plant.
Higher-level automation can also be offered ensuring automatic plant start-
up, shut down and plant optimization.
Solutions also include automation for gas turbine based on open and
combined cycle power plants as well as hydro power plants.
BHEL-EDN also manufactures SPEEDTRONIC MARK IV/MARKV
controls for gas turbines with technical know-how from GE (USA). BHEL-
EDN is the only sub licensee of GE (USA) for manufacturing and servicing
MARK IV/MARKV gas turbine controls in the world.
DC DRIVE SYSTEMS:
BHEL-EDN’s Thyristorised Digital Convertors are used for DC
drives with constant power or constant torque control. Many such
converters are already in service in rolling mills and process lines in
industries like steel, aluminums, rubber, cement, coal and copper.
Converters up to 10000A ratings with digital controls have been
supplied by BHEL-EDN.
AC DRIVE SYSTEMS:
BHEL-EDN’s adjustable speed AC Drive System with load
commutated inverter is a highly energy efficient system for
controlling synchronous motors used for flow Control Applications
like fans, pumps, and compressors in power plants and industries.
Speed control of squirrel cage induction motors with GTO (Gate
Turnoff) thermistors’ are cost effective and low on maintenance and
28
find widespread use in industries. The digital controls with hot stand
by control and power channel increase system availability and make
these drives user friendly. A number of systems have been designed
for ID Fans and Boiler Feed Pumps (BFP) of various ratings up to
500 MW power plants.
EXCITATION SYSTEMS
BHEL-EDN offers Excitation Systems in Synchronous Generators
for hydro, thermal, nuclear, co-generation, and combined cycle, DG
power plants as well as for synchronous machines in industrial
applications. With the ever-growing size and complexities of the
power system network, fast response excitation systems capable of
meeting more stringent specifications are called for to improve
system stability and availability. The state-of-the-art excitation
system offered by EDN includes fast acting, fully controlled
semiconductor bridges along with digital controls. Redundant
philosophy in power and control circuits employed ensures high
availability and hot repair/ replacement possibilities. The digital
electronics with self-diagnostic feature, programmable logic controls
and serial communication etc., provide easy and efficient integration
with plant DDC. Unique facility exists at works for closed loop
performance testing, using an online real time generator simulator.
STATIC VAR COMPENSATION SYSTEMS (SVC)
With quality of power supply-gaining prominence both in utilities
and industries, BHEL-EDN offers indigenously developed
technology for reactive power management by way of Series
Compensation Systems and Shunt Compensation Systems. A number
of systems have been supplied for both utility and industrial
applications for improvement of voltage, reactive power controls etc.
BHEL-EDN manufactures thyristor valves and controls for the SVC.
29
To cater to the need of LT loads, solid state switched capacitor
systems using Thyristors or Triacs are also offered for improving the
power factor, reducing the reactive power demand.
POWER SEMICONDUCTOR DEVICES
BHEL-EDN manufactures Power Thermistors Devices and Diodes of
various ratings to meet the requirement of high power electronic
systems used for various applications in Power, Industry and
Transportation systems. While high power thermistors devices are
used in high current rectifiers for Industrial projects, high voltage
thermistor devices are used in HVDC applications.
PHOTOVOLTAIC SYSTEMS
Realizing the tremendous potential of Solar Power as a Non-Conventional Energy Source, BHEL-EDN started manufacturing Solar Photovoltaic (SPV) Cells and Modules besides developing complete SPV Systems. A sophisticated facility with a capacity of 2MW per annum has been set up for manufacture of cells and modules. The SPV systems are specifically designed keeping in mind the necessity. Some of the major systems in operation are SPV Power Plants (Stand Alone and Grid Interactive), Solar Power Systems for Rural Radio Phones, Telecommunications, Railway Signaling and other applications.
DEFENCE ELECTRONICS
With the strong background of Control, Instrumentation and System
aspects of power plants and industries, BHEL-EDN has diversified
into the field of Simulators for training police, paramilitary and
defense personnel with state-of-the-art technology. The following
types of Simulators are manufactured.
SIMFIRE
Simfire is laser based outdoor training simulator for training of crews
in armored fighting vehicles with precision gunnery and tactical
warfare without using live ammunition, resulting in a much more
effective training at much lower cost.
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INFANTRY WEAPON EFFECTS SIMULATION SYSTEM
The Infantry Weapon Effects Simulation System (IWESS) is a laser-
based system, which simulates the effects of small arms live fire like
Self Loading Rifle, Light Machine Gun, and Snipers etc. The IWESS
is used for training in Police, Paramilitary, Military forces etc. The
IWESS greatly reduces the usage of real ammunition and it gives the
soldier the realism of being able to accurately use his personal
weapon and also gives immediate feedback about the effectiveness of
his fire position, shooting skills, weapon skills and use of ground
cover.
SMALL ARMS TRAINING SIMULATOR
Small Arms Training Simulator (SATS) is an indoor simulator used
for marksmanship training. The system can be adopted for small arms
such as Rifles, Light Machine Guns etc. The SATS system is
computer based and can accurately simulate small arms with real
recoil effect. It is a substitute for live ranging training, thereby
reducing ammunition cost involved in training.
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WORLD CLASS TECHNOLOGIES
With a view to bring world class technologies from world leaders to Indian
clients, BHEL-EDN has entered into strategic alliance with many
international giants, and sourced technologies from them.
The significant tie-ups for different products/systems include:
Siemens AG : DC Drives
: Power Semiconductor Devices
: Brushless Excitation System
: Electronic Automation for
Steam Turbines
AD Trans (through CLW) : 3 Phase AC Loco
Taxis : DC/AC EMU
ABB : HVDC Controls
: Distributed Control Systems]
: Static Excitation Systems
: Large Area Power
Semiconductor Devices
General Electric : AC Drive Controls
: Gas Turbine Controls
Sulzer Brothers : HP/LP, HP, PRDS Controls
C-DOT, India : RAX, MAX-L, MAX-XL
Stock Eqpt. Co. : Gravimetric Feeder Controls
Combustion Engg. : Flame Scanner Amplifiers
Lockheed Martin
Information Systems : Tactical Training Simulators for
Tanks
OSCMAR : Infantry Weapon Effects
Simulator Systems
32
Spartans : Small Arms Training
Simulators
33
BHEL CUSTOMER’S PROFILE :
ABB : Static excitation systems
: HVDC Control
: Semi-conductors
Siemens AG: DC Drive Control
: Semiconductors
OSCMAR : Infantry Weapon Effects Simulator System
NTPC
Indian Railways
L & T Cements
Defense ministry
TATA Iron & steel
Nuclear power corporation
Ahmedabad electric company
Tata electric company
ONGC
Reliance industry
Indian Petro Chemicals
Easy steel
34
ELECTRONICS DIVISION GROWTH
BHEL- EDN has grown rapidly over a period of time. Its shown in the
below graph:
35
SWOT ANALYSIS of BHEL-EDN:
SWOT analysis stands for strength, weakness, opportunities and threats
an analysis it is given below:
STRENGTHS:
BHEL is India’s leading manufacturer of power equipment.
It has diversified into all vital sectors of the industry, reaching
its benefits of energy to every corner of the country.
It has very good product mix that is place, product, price, promotion.
It has an effective human resource management in the country.
It has a consistent track record of growth , performance and
profitability.
Good work culture, job security, and high employment.
Quality products and services.
A customer focused company that firmly believes in being a friend
for life.
Continuous improvement in production rates especially in Control
Equipment, which is the major contributor of profits.
Staff optimization by downsizing.
Talent scouting through campus recruiting and administration of
nationwide test.
WEAKNESSES:
The operating expenses of the company are comparatively high
which affects in its profit earnings capacity.
Slow updating of technology with time.
Overstaffed departments with people not opting for VRS.
Slow processing of documents due to centralized administration.
Poor accountability on people contribution and performance.
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Union intervention in the company’s policies and working.
There is lack of an aggressive and dynamic manufacturing.
OPPORTUNITIES:
Customers looking for Turnkey capability.
Enter into Power Generation Business
Providing Total Services to Co-gen. and Captive Power Plant needs
of industry
Increased volume in Transmission and Distribution Business
Usage of international financing
Develop as a Troubleshooting service provider
Increase export share
Strategic acquisition and mergers
To expand its market share by introducing new products.
To firm up strategic alliance with global leaders for the introduction
of better and newer products.
To provide opportunities to individuals to advance their career
prospects at an incredible pace.
Support by Government.
Availability of labour at cheap costs.
Order and collaborations from overseas.
THREATS:
Competition from few companies.
Fast technological changes may affect the company.
Absence abroad may hamper export prospects unlike the competing
MNCs.
New entrants in the field.
Disinvestment policy of the Government.
High cost price in view of overheads.
37
38
FUNTIONAL ANALYSIS
PRODUCTION DEPARTMENT
Production in EDN is divided into 3 product groups.
PRODUCT GROUP
CONTROL
EQUIPMENT
SEMI-CONDUCTOR &
PHOTOVOLTIC
DEFENCE
SIMULATOR
PRODUCT PRODUCTIONTYPE LAYOUT
Control equipment Job order production Group technology
(Product and Process)
SC & PV Batch production Mixed & product
Defense simulator Job order production Product and Process
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PRODUCTION MODEL
FABRICATION SHOP & TOOL ROOM
There are 2 fabrication shops in the electronics division and one tool room
for the entire factory needs. Fabrication shop no.1 caters the need for meters
and capacitors division. Fabrication shop no.2 caters the requirement of CE
division.
Tool room is common for the division. Tool room has number of machine
tools such as lathes, milling machines, grinding machines, NC & CNC
machines and many special purpose machines.
DESIGNS:
Design department comes into picture after the commercial group prepares a
MO and sends it to designs. Its significance lies in the fact that most of the
orders of BHEL-EDN are customized. The design department takes into
consideration the requirements and features asked by the customer and
design the product accordingly.
PROCUREMENT OF MATERIALS:
MATERIAL REQUIREMENT
STORESMRP PROBABLE DATE
(Checks for the materials OF
COMPLETION
40
in stores) (it looks for
the pending order)
RAISING INDENT
SUPPLIER
FOLLOW UP:
Present month requirement is received by PPC and MPC and once in 3
months they meet and review the issues.
INVENTORY:
Additional material, new material and reduction material are accommodated
and amended by purchase department. BHEL-EDN maintains minimum
order quantity method for non-moving and slow moving materials. This is to
allow of purchasing any quantity from manufacturers, where batch order,
that is MOQ (no less order if it is necessary than it is ordered). Hence it
takes care of non-moving and slow moving materials.
MATERIALS MANAGEMENT:
The department’s major responsibility is to make sure that the right material
of the right quality and quantity is supplied at the right price and at the right
time. AGM or a senior DGM usually heads this department.
There are two departments that work under materials management for
achieving its objectives, they are:
Purchase
Stores
MATERIALS PLANNING AND CONTROL (MPC):
This department is usually headed by senior DGM. This department plays a
strategic role in materials management. MPC is the prime agency responsible
for the availability of any material required for production and hence
41
constantly keeps track of material status. It is the department, which receives
the material requisition (M.R) from the engineering dept and makes sure that
the required material is made available to the manufacturing section. As this
department has the major responsibility of the stock in the store and for
allocation and coordination with the purchase department for procuring the
right material.
Functions of M.P.C:
Allocation of materials
Follow up
Authorization
Inventory control
PURCHASE:
This department is headed by the senior DGM. This is the department that
has key responsibility for placing the purchase order (P.O) and procuring the
right material.
PURCHASE PROCESS:
The technique of processing the right material from right supplier at a right
price can be termed as the major function of the purchase. The steps carried
out in this process of purchase are:
1. An initial check if there are any orders placed for similar material. If
so then order placed is amended for the additional required quantity.
2. In the absence of any such order being placed there is a check for any
rate contract (R.C) with the suppliers for the material intended. If
any R.C is found, the order can be placed immediately
3. In absence of any such R.C, check is made for any similar order
placed in the past. If there is any order placed and the quantity
required is less than three times and if the number of order placed of
the same orders being less than three times, a repeat order can be
placed.
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4. In absence of any such repeat purchases, tender is called for and the
purchase order is released.
STORES:
This department is headed by the senior DGM. The major responsibility of
this department is to store the material and issue them when requested by the
authorized intender.
Stores of BHEL-EDN:
Maintain assembly store or component store.
PCB stores: mechanical stores and electronic stores.
W.I.P stores.
Stores telecom
Semiconductor stores.
Photovoltaic stores.
Energy meter and capacitor stores.
Tool crib stores.
Central tool crib stores.
Inflammable and chemical stores.
Scrap and surplus stores.
Maintenance stores.
INDUSTRIAL ENGINEERING:
Industrial Engineering is oriented towards optimum usage of the resource
available. It includes the techniques like work study, time study, method
study and PTS etc. Some of the advantages of Industrial engineering are
stated below
In calculating the expected time required to complete a project
In fixing time standard for jobs
In production planning and control
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In analysis of man, machine and material flow
In performance appraisal
In computing efficiency of the individual
In estimation of overtime required in completion of any time bound
project
In decision making of Top management
Make or Buy decision
Assessing training needs
Assessing manpower requirement
As already discussed IE focuses towards optimization of resource
available
Vendor rating
FUNCTIONS OF MARKETING DEPARTMENT
Market exploration
Order booking
Offering
Bidding
Preparing annual budget
projections
Exploration of market is very important for new products as well as
oid products. Planning commission forecasts as well as based on the
projections of the working group, annul plans will be prepared by this
department and in turn it will be always tracking the laying of the
new electric line and tenders. Cost estimates will be given by Finance
44
department, which makes the work easy for this department for quoting
to a bid.
Approach to marketing is different at BHEL as the customers are
usually known and orders are of large size and value. The main
function of Marketing Department is to procure manufacturing order
in coordination with the commercial group. The central manufacturing
agency is located at the corporate office in Delhi. It breaks a
composite project and assigns to the required manufacturing units.
BHEL usually adds a profit margin about 10-12% of the order. BHEL-
EDN has a separate marketing department for each product group.
BHEL has been a leader in the power sector for a long time. Its
Turnkey capacity gives it a competitive edge. After Liberalization
BHEL is acing tough competition from MNC’s like Siemen’s ,ABB,
Cegetec, and C-DOT etc. Some other customers are Tesco, MRL, and
Jindal power company Limited.
The process of sanctioning a project goes through the following
stages :
Pro – active
Marketing
Tendering
Post –tender follow
up
The following ways are used for getting an order:
a) Direct enquiry
b) Bidding after floating an enquiry tenders and procures (annexure
checklist for tender review), technical viability studies and
commercial analysis is done to select the best one, 80-90% of the
orders floated have been bagged by BHEL.
45
c) Global competitive bidding (funded by World Bank).BHEL’s
international competitiveness is demonstrated by the fact that it has
bagged 86% of the order floated for competitive bidding.
COMMERCIAL DEPARTMENT
Commercial department acts as an internal customer to the EDN.
FUNCTIONS:
Every month follow up has to be done.
Preparation of plans. Based on the internal orders and shop floor
capacity turnover plans will be prepared.
Billing, invoice and dispatch
Commercial department issues dispatch and billing instructions, based
on the above instructions the invoice will be prepared. In case of Ex-
workers, constructions for covering up insurance will be given to the
consignee.
If it is for destination, it is the duty of EDN to cover the insurance. In
case of export invoice, packing list and GR form will be sent. Earlier
even the payment of excise duty was rested with department but now
the Finance department has taken over this function.
Periodical monitoring i.e. monitoring the achievements, and
comparing that whether they are doing as per the schedule.
Packing
MANUFACTURING PROCESS
The marketing section procures orders from customers, through
advertisement, Propaganda’s and promotional methods. A copy of this
order is passed to the commercial section. The commercial section
prepares a manufacturing order on the basis of the customer
46
specifications. The Engineering section makes a note of these
specifications and tries to design the product. At the same time, a
copy of the order is issued to the material management section so
that the required material can be made available at the stores for
production. Once the product are produced, they need to be tested by
the testing section before being issued or transported to the
customer’s sites.
SWOT ANALYSIS OF MARKETING DEPARTMENT
STRENGTHS:
BHEL has a very good product mix that is place, product, price,
promotion.
Reputation.
Brand image.
WEAKNESS:
Limited competition.
Dependence on collaborators
OPPORTUNITIES:
High market potential
Global market expanding
Industrial growth upward
Bench marking and best practices’ implementation
Widespread network across the country and around the globe.
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Order and collaborations from overseas.
THREATS:
Fast changing market conditions.
New competitors emerging
HUMAN RESOURCE DEPARTMENT
HUMAN RESOURCE MANAGEMENT:
With the changing business scenario, BHEL is awake to the change and
challenges before it. In terms of new approaches to Human Resource
Management; developing and sustaining a dynamic work culture which
enables joint optimization of organizational goals and individual potential,
taking care of changing aspirations of the people are the key areas of focus
for the organization at this juncture.
Human resource is very valuable and is an asset to any organization and it
implies to BHEL too. BHEL has an effective HR department. Recently
HRD separated to Personnel & Administration Department and it is now
clubbed with EDP and headed by a common AGM. There is a DGM-HRD
who envisages the function of HRD.
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ORGANISATIONAL CHART FOR P & A DEPARTMENT
49
SM (Law & admin)
Deputy Officer Sr.Personal Officer STAFF
GENERAL MANAGER
SENIOR OFFICER
SDGM (CE MARKETING)
FINANCIAL APPROVAL
GOVERNMENT APPROVAL
FEASIBILITY
STUDY
PERSONNEL AND ADMINISTRATION DEPARTMENT
The Personnel and Administration Department takes care of all the policies,
rules and procedures relating to various aspects of HUMAN RESOURCE
MANAGEMENT and is intended to serve as a basis for the effective and
uniform implementation of these across the entire organization. In other
words, it is just managing the people by an effective personnel policy.
BHEL is proud of the personnel policy that was framed more than 3 decades
ago and updated very often. It provides various benefits to the employees.
There is a common Head for Personnel and Administration Department. The
duties of personnel and administration are widely classified into 4 wide
categories. The various jobs handled under each head are listed below.
There are 3 senior assistants, personnel assistants and office superintendents
all handling serious functions. The entire department is headed by a DGM
(HRD).
DISTRIBUTION IN HR DEPARTMENT:
All the units have their separate HR departments, which administrate the HR
functions at the unit level. Apart from this, there is a conferrable HR, which
controls all HR departments. This conferrable body is responsible for all the
policy, decision-making and other key functions.
WORK CULTURE:
The most priced assets of BHEL are its employees’ continuous training and
retaining of a positive work culture and participative style of management.
This has resulted in developing of a committed and motivated work force,
which is ready to meet the challenges of the future. Workers participation at
all levels including the shop, the plant and even the board has become the
50
norm at BHEL. Representatives of workers actively participate in various
advisory bodies. All employees are given encouragement to take part in
cultural, sports, educational and other activities. A unique work culture has
set a tradition of individual responsibility and commitment, which reflects in
every sphere of BHEL’s growth.
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COMMITTEES:
BHEL has a corporate policy and culture that encourages the committees at
various levels of operations for the various aspects. Some of the committees
that have contributed to the productivity are the safety committee, canteen
management committee etc.
EMPLOYEE CLASSIFICATION
1. EXECUTIVES
E1 -Officers \ Engineers
E2 -Senior Officers \ Engineers
E3 -Deputy Manager
E4 -Manager
E5 -Senior Manager
E6a -Deputy General Manager (DGM)
E6b -Senior Deputy General Manager (SDGM)
E7 -Additional General Manager (AGM)
E8 -General Manager (GM)
E9 -Executive Director (ED)
2. SUPERVISORS
3. ARTISANS
4. SUPPORTIVE TECHNICAL STAFF
5. UNSKILLED WORKERS
6. SEMI SKILLED WORKERS
7. CLERICAL AND OFFICE STAFF
8. TRAINEE ENGINEERS\ OFFICERS
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9. TEMPORARY AND CASUAL WORKERS
53
IMPORTANT FUNCTIONS OF HRD
1. TRANING AND DEVELOPMENT OF EMPLOYEES:
Training is one of the efficient tools that help an organization in
avoiding obsolescence of the knowledge of manpower. Some of the
reasons for training are:
Technological obsolescence
Motivation
Attitudinal changes
Reduce manpower turnover
Improve the qualities
Increase the productivity
Personnel growth
Training is classified into two types:
In house training
External training
IN-HOUSE TRAINING
When the training is conducted within the BHEL – EDN premises it is
considered In house training. The trainers would be internal or external;
usually an expert in the field is called for such training. There are training
coordinators to evaluate the need for any training required in their
department. They further co-ordinate with HRD in organizing the training
54
program. Some of the common topics covered are personality development,
aptitude, social responsibility, social development and attitude etc.
EXTERNAL TRAINING
These are the training programs, which any executive can undergo and are
usually conducted by the professional consultants from any part of India or
abroad.
These include the workshops that are conducted in hotels and the programs
conducted by the professional bodies or educational institutions. The
subjects dealt with include personality development, stress management, etc.
All are allowed to attend such program depending on the importance of the
subject and the designation of the executives. The external training is
usually for high cadre employees.
BUDGET
The total budget allocated for the training is Rs 25 lakhs. The amount is
exclusive of the sum paid to the trainers and the training program. It does
not include traveling expenses related to training.
2. TRAINING FOR APPRENTICESHIP AND MANAGEMENT
TRAINEES:
BHEL has stopped recruiting for the lower level, which required less
qualified persons. Undertaking apprentice meets this need. Every
year 600-700 apprentices are selected for various levels of jobs with
different background. The apprentice of various trades and
specializations are recruited depending on the requirement placed by
the various departments.
MONTHLY ENROLMENT:
55
Every apprentice is fixed a monthly stipend of Rs. 1900/-, as per the
Government Policies and an additional Rs. 50 is provided from
BHEL, amounting to a net stipend of Rs.1950.
Every apprentice is given the canteen facility, which gives the food at a
subsidized rate.
Apart from this, they can also make use of company’s transport. They
are even provided a pair of uniform.
SELECTION PROCESS OF APPRENTICE:
The apprentices are selected from all over Karnataka through a
campus recruitment process. The process of selection is through
written test and interview.
MANAGEMENT TRAINEES:
BHEL has the policy of employing only at lower level of executive
cadre, which is E1 class. Later they are promoted based on their service
and merit. The executives selected on the E1 classes are called the
management trainees. They are on the training period of one year, later
they are all absorbed as
regular permanent employees. In the period of training they are offered a
salary of Rs 7000/-, then they are finally selected as engineers.
3. METHOD OF SELECTION FOR MANAGEMENT TRAINEES:
The various steps followed in selection are as given below.
1. Advertisements: The Corporate Office, Delhi, specifying the
needs of all the units and offices, gives Advertisements in all
major newspapers.
56
2. Screening: Written examination in which, Part1 constitutes
academic specialization of the candidate, Part2 constitutes
general awareness and aptitude. Both the parts are of the
objective type.
3. Interviews: Interview committee conducts the interview of
the selected candidates on various aspects of individual like
enthusiasm, initiative, creativity, attitude, behavior, loyalty
factors, etc.
STUDENT TRAINEES:
As a social obligation and responsibility, BHEL – EDN is continuously
helping young students by providing the necessary project training.
In plant training (non-technical aspect)
(M.B.A, M.COM)
Industrial training (technical aspect)
(Diploma, B.E, M.E)
Industrial visits.
CO-ORDINATION IN SEMINARS AND MEETINGS:
One of the important activities of the HRD is coordinating the various
seminars and meeting organized in the premises. It is the responsibility of
HRD to arrange for the necessary facilities and infrastructure. In certain
cases, they even host seminars, which are of social benefit.
TRANSFER POLICY:
Executive employee of the company is liable for transfer from one
department / section/ job with in the same unit / division or from one
57
unit/ division of which company to another or from the discretion of
the management.
At the same time while implementing the transfer policy the carrier
base promotion policy has also to be reckoned with.
58
WELFARE AND BENEFITS
LEAVE TRAVEL CONCESSION (LTC):
Once in every 2 years, employees can go on LTC to any desired destination
in India along with their family members. An employee of the grade of
DGM and above can claim airfare, where as others can claim for second-
class AC rail fare.
RETIREMENT BENEFITS:
Individuals who retire on completion of service duration get some of the benefits if
he has been in continuous service for the past 3 years. They include
Pension
Provident fund
Group insurance etc.
VEHICLE LOAN
Vehicle loans are provided for all the permanent employees depending on
their cadre for a 2 wheeler/4 wheeler. Employees of the cadre of E2 and
above are only provided a 4-wheeler loan. Other employees are provided
with 2 wheeler loans. The loan amount is Rs. 15000/- and 1, 10,000/- for
two-wheeler and 4 wheeler respectively. The loans are made available at the
interest fixed by SBI.
DEATH COMPENSATION
In case of death of any of the employees during service, BHEL provides all
the benefits that are due to the nominee. Provident Fund and Gratuity
payments are allowed to the immediate payments, it however doesn’t
provide any job compensation for any of its family members. Any of the
savings during the course of service and any unsettled cashable leaves are
paid to the family members immediately.
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COMPUTER LOANS
All the executives are entitled to a computer loan of Rs 80000/- at an interest
of 1.8% per month (fixed by S.B.I).
UNIFORMS:
Every employee and casual labourer is provided the material for a pair of
uniform every year. The stitching charges are paid by the company, which is
fixed by the Corporate Office.
INTERNET REIMBURSEMENT:
Executive of E1 to E5 is entitled to claim for 100 hours of Internet charges.
Where as the E6 and above can claim for 250 hours for a year.
MEDICAL EXPENDITURE:
The company meets all the medical expenses incurred by the employees.
The claims can be made on monthly basis. In case of high amount for major
surgeries or such, the advance can be obtained by producing the necessary
documents. The claims can be made for every family member of the
employees.
TRAVELING ALLOWANCE:
Any of the traveling expenses incurred by an employee for any official work
is met as per the guidelines. The Executives of E5 class and above can claim
for carfare.
NEWSPAPER ALLOWANCE:
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Every employee is given newspaper allowance every month. The amount is
however fixed by the Corporate Office and is included in the salary.
HOUSING FACILITIES
The employees are eligible to claim accommodation facility.
DEARNESS ALLOWANCE
DA is granted to compensate the price increase above CPI 1099 points, to
which the revised salary grades relate. Payment of DA based on slab basis
relate to percentage increases over quarterly of AICPI 1099.
INCENTIVES/ BONUS
BHEL does not practice incentives on any individual performance. Every
year based on the turnover and profits, yearly bonus is given to all its
employees as fixed by the corporate office.
WORKING HOURS
Every individual has to put in a minimum of 48 hours of work per year, 7:30
am to 4:35 pm in all working days except on Saturday (7:30 to 12:30 pm),
Sunday is weekly off.
LEAVES
Casual Leave (CL):
During the period of training and on absorption, every employee is eligible
for CL of 10 days per year. CL can be claimed even for half a day.
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Earned Leave (EL):
During the period and on joining, each employee is entitled to EL with salary
for 30 days in the first five years of service. The minimum limit of the
accumulation is 240 days.
Maternity Leave:
All female employees, excluding apprentices, according to the Apprentices
Act 1961, are entitled to the grants of maternity leave. Subject to the
provision of this act, every woman shall be entitled to and her employer shall
be liable for payment during the period of her actual absence immediately
proceeding and including the day of her delivery and for the immediate six
weeks.
Canteen Facilities:
Every employee, temporary or casual is provided with the canteen facility.
The food is available at subsidized rate.
LAW & ADMINISTRATION
Law & Administration is playing a vital role in maintaining the company
rules & regulations & to give justice for the employees. It has its own legal
advisors to maintain justice in the organization. An executive takes care of
the departments. Quite a large number of disputes of BHEL-EDN are about
the quarrels between two parties regarding the breaking of company rules &
regulations laid by corporate office.
Disciplinary action is taken against the employees who do not obey the rules.
Depending on the seriousness of the case, it is transferred to the court.
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4. PERFORMANCE APPRAISAL
Every authority maintains Annual Confidential Report (A.C.R.) of all his
subordinates with the performance recorded very often. It is kept highly
confidential and is available only to the senior authority and the personnel
department. During the time of performance appraisal the promotion
committee discusses the various positive and negative factors.
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PROMOTIONS
Every employee is eligible for promotion. The criterion for promotion is
time bound and performance/merit based. The promotion is given once the
employee completes the stipulated duration and then based on the
performance; promotions are awarded. The list is usually released twice a
year, once during June and other during December.
PROMOTION POLICES AND RULES:
Objectives:
To provide all employees with broad equality of opportunities in
growth and career prospects.
To ensure fairness, equality, consistency and uniformity in the
matters of promotion of employees in all the units/divisions of the
company
To sustain the high morale of the employees by informing them of
the promotion opportunity existing in the organization.
PROMOTION RULES:
Classification of group/cadres:
For the purpose of promotion and career growth all the employees are
included in one of the following groups/ cadres.
Sr. Executive cadre E6 and above
Executive cadre E1 to E5
Supervisory cadre SA1 / SB 1 to SA7/SB7 & IE’S
Skilled labour A3 / B3 to A11 / B11
Semiskilled group A2 / B2
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Unskilled group A1 / B1
Sr. Executive cadre is treated as all company cadres. Promotion to and
within this cadre will be regulated on a company wide basis and carried out
by the corporate office on the recommendations of the special committee.
VOLUNTARY RETIREMENT SCHEME (V.R.S):
Realizing the organization structure not being a pyramid and the number of
people in the middle management being some of the lower class, BHEL has
come out with V.R.S. The benefits to the employees were as below:
45 days salary of each completed year of service.
Claim on gratuity and provident fund as per the legal rules under the
various schemes.
Exit Interviews:
Not many people used to leave BHEL prior to liberalization. Now when
many MNCs have opened their offices and are offering better prospects, it is
observed that considerable amount of people are quitting for better prospects.
BHEL cannot offer a higher pay package to any position other than defined
in the personnel policy. Exit interviews were conducted for the employees,
quitting BHEL. A specific form is to be filled by every employee and even
inferences are taken on the working and the improvement of the
organization.
Dealing on their reasons for quitting the organization, BHEL has found that
better prospects are the main cause and it is not really possible to tackle this
problem; BHEL is trying to develop loyalty among its employees.
65
Medical facilities:
Medical facility unit has own hospital and has a contact with a chain of
hospitals like:
St. Johns hospital for neurology, Apollo hospital for cardiology,Mallya ,
CMC Vellore for cancer disease , KIMS
Service is free for the employees in these hospitals and facilities are given
for the employees and his family, but for children only up to 18 years of age.
Depending upon the grade of the employee the hospital facility is provided
as
General ward ------employee
Semi private ward ------for E1
Private ward ------for E11
INSURANCE:
Insurance establishment is responsible for two types of insurance
Group saving insurance connected with corporate office and LIC
Group saving linked insurance
PARTICIPATIVE MANAGEMENT:
The avenues, opportunities and means available for all levels of employees
to participate in the company’s policy making, decision making and planning
of company’s systems, procedures, improvements and business operations is
known as participative management
PARTICIPATIVE MANAGEMENT IN BHEL:
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Participative management in BHEL is implemented in BHEL through
various forums, committees, representations, bargain able means, awards,
recognitions and informal negotiations, counselling or discussions.
AVENUES IN BHEL
JOINT COMMITTEE:
Is a tripartite committee comprising of all trade unions, all local
managements and corporate policy making body ofBHEL including CMD
and board of directors.
Joint committee is an apex committee which decides on key issues like wage
revision, bonus, company’s career policies, operations or anything that
would apply to BHEL as a whole.
TRADE UNION:
Recognized union/s in units will negotiate with union on local and unit level
issues. There can be single or multiple unions in each unit with or without
affiliation to any national trade union organisation.
PLANT COUNCIL:
Plant council is a body comprising of union nominees on the one side and the
senior executives on the other side. They will meet periodically to discuss
and sort out many issues concerning business operations at unit level.
SHOP COUNCIL:
Shop council is a wing of plant council which is formed at departmental
level to discuss problems, performance and plans at departmental level and
comprises of members nominated by union and management
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WORKS COMMITTEE:
Is a statutory body with 8 member’s elected and equal number nominated by
management? They would discuss working conditions, quality of work life
and recommend solutions to problems, if any.
CANTEEN MANAGING COMMITTEE:
Is an elected body with three members from the workers and equal number
nominated by the management. The committee ensures smooth working of
the canteen and suggests plan of improvement.
SPORTS COMMITTEE:
Is an elected body with three members and with equal nominated
representatives from management. The committee facilitates, sports, literary
and cultural activities from amongst employees.
BHEL EPF:
Employees’ provident fund trust of BHEL is an elected body of trustees and
nominated members who manage the provident fund account and the finance
under this fund including loan disbursement and final settlement.
SAFETY COMMITTEE:
Central safety committee is a nominated body which studies, solves and
improves safety issues in the organisation. It generates enhanced awareness
amongst employees and recommends safe work practices
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SAFETY STEWARDS
Safety stewards are nominated by the management to represent each work
area, educate co-employees, bring to the notice of management various
problems and issues concerning safety.
COMPANY APPOINTED COMMITTEES:
Plant quality committee
Product committee
HSE – apex committee
HSE – working committee
Olic – official language
Grievance redressed committee
HRD governing council
Training co-ordinators scheme
Inference facilitators
Productivity co-ordinators
AWARDS AND RECOGNITIONS:
Excel awards
Impress – inference and productivity awards
Awards for sports, cultural and literary activities
OTHER ASSOCIATIONS
BHEL executive association
BHEL officers’ club
WIPS [women in public sector]
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BHEL supervisory staff association
BHEL SC ST welfare association
BHEL kannada hitharakshanasamithi
OTHER FORUMS
Management trainees’ hostel administration Committee
BHEL township resident’s forum
BHEL retired Employees forum
BHEL credit co-operative Society
BHEL house building society
INVOLVEMENT BY PARTICIPATION IN OTHER ACTIVITIES
Social responsibility
Environment
Children summer camps
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SWOT Analysis of Human Resources Department:
Strength:
BHEL has an effective human resources management in the
company.
Highly motivated and large work force.
Good work culture, job security and high employment.
Dedicated employees.
High job security.
Sense of commitment, involvement and belongingness.
Assured career growth.
Human touch.
Weakness:
Imbalance in distribution of workload among the employees.
Poor accountability on people contribution and performance.
Time bound promotion policy and high job security leading
sometimes to improper working on part of employee.
Opportunities:
Predetermined customers and good contractual relationship.
Availability of labour at cheap costs.
Threats:
Age factor of employees.
Outstanding payments.
Curb on manpower.
Labour turn-over in highly skilled, technical & areas of expertise
Huge salary bill
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FINANCE DEPARTMENT
Departmental Structure
Executive Director
A.G.M Finance
Senior D.G.M –1 Senior
D.G.M –2
D.G.M - 1 D.G.M – 2
Senior Manager – 1 Senior Manager – 2 Senior
Manager – 3
Manager – 1 Manager – 2 Manager – 3
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SECTIONS OF FINANCE DEPARTMENT
The various sections under finance department are:
Book and budget
Sales
Priced stores ledger
Costing
Establishment
Bills payable
Books & budget:
Collection of accounts from different sections
Preparation of trial balance and final accounts
Coordination with auditor
Helps statutory auditor
Sales:
It deals with
Collection
Debtor’s ledger
MIR etc.
Priced stores ledger:
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This section is responsible for maintaining accounts for the stores in
monetary items.
Costing:
Each product is having a separate section. It sets the cost that is used by
commercial group to add profit margin to set the price.
Establishment:
This section is responsible for cash disbursements and payment. It handles
all the payment to the employees such as
Benefits:
Medical reimbursement
Provident fund
Incentives
Loans and advances etc.
Bills payable:
This section handles the payment to be made to the suppliers once the S.R.V
(store receipt vouchers), P.O (purchase order) invoice are received, cross
verification of the P.O terms, quality and quantity assurance with the S.R.V
and invoice. Once all the claims are found satisfactory, the payment is
issued as per the terms.
Features:
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BHEL is the first government company to publish accounting policies. They
have centralized cash credit control and centralized cash management.
BHEL units cannot borrow directly from outside but from centralized
component account. The surplus funds of any BHEL unit are allocated to
other units and interest is charged on them.
OTHER IMPORTANT FUNCTIONS –
Payment to establishment – wages, salary etc.
Payment to suppliers,
1. Indigenous purchase
2. Important purchase (e.g. purchase, bills)
Terms of payment for purchase are:
Letter of credit (L/C) (most preferential)
Advance (D.D)
Cash and delivery (C.O.D)
Site draft (S.D) (if supplier is not familiar)
Pro-forma payment
SERVICE BILLS:
This section maintains bills for payment of
Factory service
Maintenance (civil & mechanical)
PURCHASE FINANCE:
Procurement of both indigenous and imports, 300 crores of material is
purchased every year and 50-60% are imports.
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INTERNAL AUDIT:
The main functions of internal audit are:
Fault recognition
Inferences for improvement
Overseas work of book budget
Assisting working level people
Internal audit conducts site audit, once in a year.
IT is a practice of conducting an internal audit before this statutory external
audit and this audit is conducted by CAG (Controller Auditor General).
ADDITIONAL INFORMATION:
Weighted average method is used for inventory valuation.
- Companies use act of 1956 straight line depreciation method on
fixed assets.
- By income tax act 1961 written down value method is used for
charging depreciation
TURN OVER FOR LAST FIVE YEARS ( Rs.CRORES)
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PROFIT BEFORE TAX (PBT) FOR LAST FIVE YEARS
(Rs.CRORES)
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79
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SWOT ANALYSIS OF FINANCE DEPARTMENT
Strength:
BHEL has consistent track record of growth, performance and
profitability.
Highly experienced accountants, CA, ICWA employees are
recruitment.
Weakness:
Stringent rules are involved in preparing accounts
Enormous paper work is involved.
Errors are possible in calculations of accounts.
Opportunities:
Paper work can be reduced by using latest technologies
Threats:
Competitors will be able to view the progress and performances
of the company which is prepared by the finance department.
Disinvestment policy of the government.
QUALITY DEPARTMENT
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ORGANISATION CHART OF QUALITY DEPARTMENT:
QUALITY ASSURANCE:
BHEL has acquired ISO-9000 certification for most of its operations.
Emphasis is given to the highest standards of quality at every stage of
operations through implementation of quality management systems and
procedures in line with international standards and practices. International
bodies like “ASME” and “API” have awarded certification to BHEL after
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SM (Welfare) P & A
DGM (P & A) DGM Personal Officer
DM (P) DGM
Assistant General Manager
DGM (P) GENERAL
Comprehensive scrutiny and verification of systems and operations in force
is in various units. Calibration facilities / testing laboratories have also been
accredited under the NCTF scheme being operated under the aegis of DST
(Department of science and technology).
Focus on Quality:
ISO 9001 certification conferred by the Bureau VERITAS Quality
International (BVQI) UK, on Electronics Division has enabled it to
strengthen its presence both at home and in the International market.
A rigorously quality assurance programme is followed by BHEL-EDN. The
facilities and procedures being used, dovetail to the requirement of this
quality plan. The Quality Manual defines quality responsibilities,
relationships, systems and procedures for all functions and personnel
necessary to focus and integrate the quality activities.
Latest, high precision test equipment in each area of testing is available in
the mechanical, electrical, electronics and chemical laboratories. A full-
fledged metrology laboratory (accredited by National Accreditation Board
for Testing and Calibration laboratories) caters to periodic in-house
calibration of all mechanical gauges and fixtures. All electron test and
measuring instruments are calibrated regularly at the unit’s well-equipped
Instruments calibration laboratory.
The concept of quality circles has been an integral part of EDN’s operations
and has resulted in commendable improvements in systems and processes.
The proximity and access of BHEL –EDN, Bangalore to a number of
defense and civilian test and evaluation facilities like CQAL, ETDC, CPRI,
IISC and LCSO has been a great advantage in keeping up with quality
standards (including different international standards and documentation).
EDN also has a close working relationship with organizations like Bharat
Electronics (BE), National Aeronautics Laboratory (NAL) and several
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defense laboratories. Availability of subcontractors and vendors certified
and approved by agencies like C-Dot, defense and space research
organizations is another distinct advantage in Bangalore.
Inline with corporate policy on Environment Management Systems BHEL
Bangalore based units are certified under Environment Management System
ISO.
NATIONAL AND INTERNATIONAL RECOGNITION:
BHEL photovoltaic modules certified to the international standard
IEC 61215, by Joint Research Centre, European commission, ISPRA,
Italy.]
ISI certification (IS 13779) for Electronic Energy Meters.
HN Thandani award conferred on EDN by the Indian Institute of
Industrial Engineering in recognition of innovative development and
support to industrial engineering and productivity.
IETE Corporate award for EDN by the Institute of Electronics and
Telecommunication for outstanding performance and excellence in
Electronics and Telecommunication.
EDN’s quality circle won the second prize in the National
Convention of Quality Circles.
For the second consecutive year, EDN received the British Safety
Council Award.
As a commitment towards Total Quality Management (TQM) in line with
CII / EFQM guidelines, annual improvement action plans are being
implemented involving techniques like;
Benchmarking
Business Process Re-engineering
Six Sigma and
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Kaizen
These are resulting in cycle time reduction for further improvements in
delivery and technological process up gradation, leading to improvement in
quality of products and enhanced customer focus on a continuous basis.
To fulfill its role as a corporate citizen towards protection and conservation
of the environment and ensuring that its products and systems also meet such
requirements, BHEL has finalized a Corporate Environment Management
Policy for ISO 14001 certification.
For ISO 9001 certification the INTERNAL AUDIT is done once in 6 months
by the BHEL personnel independent of their functions and the External
Audit is done by BVQI (Bureau Verities Quality International)
The management Responsibilities regarding Quality are:
Management must define and document its policy objectives and
commitment to quality.
Ensure that it is understood and implemented at all levels.
Define responsibilities and authorities.
Identify verification activities and assign to competent personnel with
adequate resources.
Appoint a management representative.
THE CII MODEL FOR TQM (followed by BHEL)
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Senior Manager
Senior Manager
Senior Manager
Senior Deputy
Manager
Manager
Senior Manager
Impact on society
Resources
ENABLERS RES
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Deputy General Manager
SELF-ASSESSMENT
Continuous improvement
Business Excellence
QUALITY SYSTEM STANDARDS
ISO – INTERNATIONAL ORGANISATION FOR
STANDARDISATION
ISO SERIES OF STANDARDS
ISO 9000, ISO 9001, ISO 9004
ISO 9001:
Covers management responsibility, contract review, control of
design, purchase, documents, production, testing storage etc.
All units of BHEL are ISO 9001 certified
Certification Agency- BVQI (Bureau Veritas Quality International)
Internal Audit once in 6 months
BVQI (external) Audit once in 6 months
First certification was in July 1993
Recertified in Nov 1996(once in 3 yrs)
Further recertified in Dec 2000
ISO 9000-2000 VERSION- BRIEF OVERVIEW
Revised standard is compatible with principles of ISO 14000 and
TQM. It centers on results achieved through P-D-C-A (Plan, Do,
Check, Act) and process approach.
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Focus on business needs, continual improvement through measurable
performance parameters leading to customer satisfaction.
Mandatory documentation requirement simplified; required in 6 of
the following areas.
1. Document control
2. Quality records
3. Internal audit
4. Control of non-conforming products
5. Corrective action
6. Preventive action
ISO 14000 (ENVIRONMENT MANAGEMENT SYSTEM)
Covers Statutory, Regulatory Acts
(Pollution, Chemical Treatment, Discharge etc)
Energy Conservation, Resource Utilization
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MANAGEMENT INFORMATION SYSTEMS
DEPARTMENT
BHEL has decided to take up information technology as a business initiative
with its existing expertise in IT and rich domain knowledge in power station
engineering, servicing and allied areas. BHEL can leverage itself to diversify
into the new economy sector of InfoTech and IT enabled services. The
company is strengthening its IT linkages within the organization and is
evaluating its approach towards emerging opportunities in IT, including e-
business which is fast transforming the traditional ways of business
transactions.
With these strategies, initiatives and continuous efforts to enhance its
competitiveness by reducing cycle time, cost and improving quality, BHEL
is on its way to achieving its vision of being a world class innovative,
competitive and profitable engineering enterprise providing total business
solutions.
Computerization in BHEL commenced at the very inception of the company
in the sixties. Initially, the manufacturing units were dependent on the
technology transferred from the collaborators through collaborator supplier
systems procedures and computer programs with suitable adaptations. The
systems and procedures formulated those days laid a strong foundation for
the development of an information technology base in the years that
followed.
Over the years, starting with the unit records machines, the computing power
and its technology was gradually upgraded in line with the functional needs
of the company. Suitable changes were adapted in the information
technology scenario.
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Today, computers are being deployed in all facets of the company’s
operations both for business and engineering applications. Each of the
manufacturing units has a strong functional, computerized system base
supported by state-of-the-art information technology.
The major units have centralized mainframe computers, while minor ones
have got mini-computer systems. The front-end-user-friendly desktop
personal computers are used in each of the units extensively.
In the data communications area, all the units are linked up through a wide
area corporate data network, BHELNET. Each of the major units is in the
process of setting up its campus-wide backbone network supported by the
LAN for inter-office/departmental connectivity for systems integration.
The company has a professional outlook towards the information technology.
Strategies and strengthening in IT infrastructure is in line with the future
business requirements. A core group of IT personnel are available in each of
the units with proper support and direction from a similar apex body at the
corporate level. The enterprise-wide computerized systems, web enabled
technology, e-commerce concepts, collaboration and concurrent engineering,
Simulation modeling and video conferencing are some of the newer areas
considered for adaptation today, for meeting the business challenges of the
future.
SAP IMPLEMENTATION:
BHEL-EDN in co-operation with Wipro is in the process of implementing
SAP, an ERP Package for the proper integration of business process among
different departments. They have planned to implement SAP in about six
months time.
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MIS SUB SYSTEMS
MIS
Transaction Management Decision
Office
Processing Reporting Support
Automation
System (TPS) System(MRS) System(DSS)
System(OAS)
FACTORY SERVICE DEPARTMENT
Functions :
Maintenance services
Power and transport service
Maintenance of information technology systems (PC’s)
Canteen, gardening, lift, etc.
Design and fabrication special type of machines
Operation and maintenance of vehicles
Maintenance at township
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Transportation Section:
In EDN, there are 4 Fork lifters, 3 tractors, 2 trucks and 3 cars.
Additional cars for the moment of Executives will be hired.
Maintenance and service of all these vehicules come under the perview
of this department.BMTC buses are hired for facilitating the employees
to reach factory and back home at the beginning and of each shift.
Drivers will be given identity cards except these; other people are not
permitted to drive in the vehicles into the premises.
Township:
InBangalore, ther are 169 fiats allotted on the basis of seniority.
Maintenance of these flats also comes under this department. Civil
maintenance bore well maintenance: this department will look after
sports club maintenance etc.
Maintenance:
This section will look after mechanical and electrical maintenance.
Since this is the process industry, several types of machines are used.
For the maintenanace department, starting time is receiving the
complaints, down is getting the requsition slip and end time is handing
over the machine to production department. There are 2 types of
maintenance viz. preventive and breakdown maintenance.
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BUSINESS ACTIVITY FLOW CHART
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Leadership Policy & strategy Customer satisfaction
SENIOR ENGINEER
EX-FOREMAN SAFETY
MANAGER (Safety)
SENIOR MANAGER(Factory Service)
PLANNING AND DEVELOPMENT - STRATEGIC BUSINESS PLANNING
MARKETING – SECURING ORDERS THROUGH TENDERS AND NEGOTIATIONS
COMMERCIAL – PROJECT MANAGEMENT, CONTRACTING
MATERIAL PLANNING, INDENTING, ORDERING [P.I., P.O., VENDOR DEVPT.
ENGINEERING - BOM, DEVICE LIST, MID
RELEASE OF M.O. MANUFACTUR-ING ORDER
MATERIAL RECEIPT – GOODS INWARDS / INSPECTION / SRV
PPC – PRODN. PLANNING & CONTROL – MRS, LOADING & SCHEDULING
SUMMARY OF ANALYSIS AND INFERENCES
Problem Analysis
1. Slow adaptation of new technology
2. To improve the sales turn over ratio.
3. To reduce the cost of production time.
4. To improve quality to satisfy customer future needs.
5. A new technology will reduce the cost and time also the company
will be able to cater the requirement of the customer.
Scope:
1. Compare analysis between the existing technology in BHEL and
advance technology in the market.
2. To determine the effectiveness of the new technology.
Data Collection:
1. Primary Data
2. Secondary Data
Primary Data:
1 Direct marketing with employees.
2 Guidance of product guide in BHEL.
Secondary Data:
1 Books
a) Marketing Management(Philip Kotler)
b) Production Management (Ronald J. Ebert)
2 Company manuals
3 BHEL website
4 Business World
Limitations:
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Need for study
1) Competitors of BHEL are adopting new technology very fastly and
grabbing. The marketing in term reducing the share of BHEL.
2) To meet customer's anticipation with high quality production with
minimum cost.
Inferences
1. Control Equipment to continue to be main contributor
2. Growth in Photovoltaic business should be anticipated
3. It is also necessary that the job rotation to be made in periodical
intervals.
4. Effective training should be imparted to the employee over the
change in technology.
5. Shift in Telecom business from land line to mobile
6. To tap business in WLL and Access products
7. Entry into defence areas like Embedded Electronics, Naval Mines
and Torpedoes, Computer Graphic Images (CGI) based Simulators,
Battle Management System, and Combat Training Centre (CTC) etc.
8. - Very important of all is the marketing department function i.e. it has
to do good advertisement and build brand awareness in the market.
9. - Job rotation, job enlargement, job enrichment needs to be done
frequently in EDN which would motivate a employee to do better.
10. - As BHEL faces a tough competitions from private firms it must
formulate better policies that attract customers.
11. - In order to survive and to be a leader BHEL needs to come out of
new products continuously and increase its product line.
12. - BHEL also needs serious technology upgrading since in some
production units, the machinery being used is as old as 1980's.
13. - It needs young upgraded work force than an older force so it needs
to replace them gradually as time permits.
14. - It needs also to eliminate the excess work force.
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Findings
- BHEL-EDN's products are priced higher than its competitors.
- Recruitment process has been increased from last two years, due to increase
in demand.
- BHEL among the public sector claims to be the best and which is true.
- BHEL has learnt it hard way and has been continuously striving to compete
with the competitors and has been successful.
- BHEL-EDN does not approach the customer instead it waits for the
customer to come to it since its products are priced higher than other players
in the field so it thinks that those who can afford its products will
automatically approach it.
- Because of computerization there is cost reduction in the form of reduction
in paper work and also quickness of action.
- BHEL is showing consistent growth prospective.
- There has been constant rise in BHEL-EDN's profit year after year.
- BHEL-EDN is managing its Human Resources and marketing very
effectively by conducting various types of training and other sessions.
- It has centralised many functions which helps of better control and
coordination.
5.2 Inferences
- Very important of all is the marketing department function i.e it has to do
good advertisement and build brand awareness in the market.
- Job rotation, job enlargement, job enrichment needs to be done frequently
in EDN which would motivate a employee to do better.
- As BHEL faces a tough competitions from private firms it must formulate
better policies that attract customers.
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- In order to survive and to be a leader BHEL needs to come out of new
products continuously and increase its product line.
- BHEL also needs serious technology upgrading since in some production
units, the machinery being used is as old as 1980's.
- It needs young upgraded work force than an older force so it needs to
replace them gradually as time permits.
- It needs also to eliminate the excess work force.
3.1 Statement of the problem
To find out the market potential for control equipment’s.
3.2 Title of the study
“A study on market potential for control equipment’s manufactured by
BHEL-EDN, Bangalore”.
3.3 Objectives of the study
To study the market potential for the control equipment’s in
Bangalore.
To find the influence of Word Of Mouth (WOM) communication in
purchase of the products like control equipment’s.
3.4 Need for the study
As the company is planning to bring a new product to the market, it is
important to estimate the market potential of the product in the market.
Estimating the market potential for a business is critical in evaluating its
viability and provides an estimate of the maximum total sales potential for a
given market. Once the estimated market potential has been calculated, it is
possible to determine if the market is large enough to sustain our proposed
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business or sustain an addition competitor in the marketplace. It is important
that the estimated market potential sets an upper boundary on the market size
and can be expressed in either units and/or sales.
It is also important to study about the sources through which the customers
collect the information about the products and the services, so that we can try
to promote our products through those channels. Word of mouth
communication also playing one of the important role in the organizational
buying. So it is important to know whether there is influence of word of
mouth communication in purchasing of the products like electric control
panels. If there is an influence of word of mouth communication, then the
company has to concentrate in bringing the quality and durable product to
the market and also it has to concentrate on its after sales services, as the
customers mostly communicate about the after sales service to one another.
It is necessary to know about the awareness level about the company in the
market, so that it will be easy to estimate the expenditures to be incurred to
promote the product. It is also important to know about whether the
customers who are aware about the company are having favorable opinion
about the company to look back into its strategies.
3.5 METHODOLOGY
3.5.1 Type of the study
This study is descriptive in nature as it involves the study of market potential
for the product, it covers the understanding of whether the respondents
require the control equipment’s or not, their sources of collecting the
information and also studying the awareness level about the company among
the respondents.
3.5.2 Sources of data
a) Primary b) secondary
(i) To attain all the mentioned objectives we relied on the secondary data.
We drafted the questionnaire for the companies, asked them to fill up the
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questionnaire and got the necessary information to attain our stated
objectives.
(ii) Secondary data was collected through BHEL publications and websites.
3.5.3 Sampling Plan
a)The sampling method adopted for the study was “non probability
Sampling”. The samples were selected on the basis of three criterions. Firstly
the companies should be active manufacturers in country. Secondly, they
should have the in hand projects and they should have the corporate offices
in India.
b) Sampling units were the distributer of powers.
c) Sample size
A sample size of 30 is taken for the study.
3.5.4 Tool for Data Collection:
A questionnaire was been designed as a tool for data collection. It contained
the questions for understanding the requirement of electric control
equipments, whether they are ready to purchase or not, their sources of
collecting the information about the products and the services and their
awareness level about the company.
3.5.5 Control method
Personal interviews were used to contact builders.
3.6 LIMITATIONS
Within the given time frame it was possible to meet around thirty
companies only.
Only major companies have been considered.
Only major companies were considered for the study
3.6.1 Tool for Data Collection:
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A questionnaire was been designed as a tool for data collection. It contained
the questions for understanding the requirement of electric control
equipment’s, whether they are ready to purchase or not, their sources of
collecting the information about the products and the services and their
awareness level about the company.
Table .No:4.1 Table showing No. of customers purchased electric control
equipment’s
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Responses No of respondents %of respondents
Yes 30 100
No 0 0
Total 30 100
Graph .No: 4.1 Graph showing No. of customers purchased electric
control equipment’s
Interpretation
Out of thirty respondents, all the respondents told that they have purchased
the electric control equipment’s, i.e. 100 percent of respondents responded
that they have purchased the electric control equipment.
Inference
It is obvious that, the companies need the electric control equipment’s and
already they are using the control equipment’s in their projects for the safety
purposes.
2) You mostly rely on
a) Single supplier b) Multi-supplier
Table.No:4.2 Table showing dependence of customers on suppliers
Purchase option No of respondents %of respondents
Single supplier 8 26.67
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Multi supplier 22 73.33
Total 30 100
Graph No: 4.10.1 Graph showing Awareness about BHEL amongst
respondents
Interpretation
Respondents were asked whether they are aware about the Bharat Heavy
Electricals .Ltd or not.87% of the respondents responded that they are aware
about the company. And only 13% of the respondents responded that they
are not aware about the company.
Inference
The Bharat Heavy Electricals.Ltd is the well known company in the market.
It has well established its roots in the market and has created well awareness
in the market. This company doesn’t have worry much about creating the
awareness in the market.
11) If yes, what is your opinion about this company?
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a) Favorable
b) Unfavorable
c) Don’t know
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Table No: 4.11.1 Table showing Opinion about the BHEL
Responses No of respondents %of respondents
Favorable 26 100
unfavorable 0 0
Don’t know 0 0
Total 26 100
Graph No: 4.11.1 Graph showing Opinion about the BHEL
Interpretation
Out of the 87% companies who are aware about the company, all of them
have favorable opinion about the company.
Inference
The company is well known for its good quality of products and the services.
The company is providing the good quality of products to its customers..
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Table No: 4.11.2 Table showing number of Potential buyers
Responses No of Respondents % of Respondents
Yes 25 83.33
No 5 16.66
Total 30 100
Graph No: 4.11.2 Graph showing Potential buyers
Interpretation
Out of the thirty respondents who responded to the question, 83% told that
they ready to purchase the control equipments, if the company provides all
the necessary criteria that they look into the control equipments.Only 13% of
the respondents told that they don’t purchase from this company.
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Inference
The new product control equipment has a good potential market with
reference to Bharat heavy electricals among the companies of the Bangalore.
The companies are in need if the electric control equipments as they use it in
their companies for the safety purposes.
5.1 Summary of findings:
All the companies are using the electric control equipment’s in
their projects. The companies are giving prime most importance
to the electrical safety in the companies constructed by them.
Most of the companies rely on the multi suppliers. They rely on
multi suppliers, because they may get the price benefits. So it is
very difficult to retain these customers as they will be always
having the multi options.
When it comes to the criteria that the companies look into when
purchasing the control equipment’s are, the price, the company
brand name and the quality stand as the three major criteria
which influence the purchase of the electric control
equipment’s. After sales service is the least preferred criteria
when it comes to the purchase of electric control equipment’s.
This indicates that the customers look into only tangible things
like price, the company brand name etc., or else we can say that
the products like electric control equipment’s need less after
sales service.
The majority of the companies rely on the consultants for the
information about the products and the services. Secondly it
comes to the industry websites which provide the information
about the products and the services. Thirdly it comes to the
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Word of Mouth Communication through which the companies
collect the information about the products and the services. One
of the interesting things is, the sales persons are considered as
the very least providers of the information about the products
and the services. We can say that the builders bear very less
amount of patience to deal with the sales persons.
One of the interesting thing that we found out is, around 86% of
the builders use Word of mouth communication as the source of
information. So we can say that word of mouth communication
is one of the reliable sources of information and is used by
majority of the builders for collecting the information about the
product and the services. Customers spread the comments about
the products to one another through word of mouth
communication, so it is important to serve the good quality
product to increase our sales.
Majority of the companies treat word of mouth communication
as important. By word of mouth communication the companies
seek information about the product durability, after sales
service etc., which can’t be seen while purchasing the products.
Price and the design of the product are given less importance in
the word of mouth communication.
Major percent of the word of mouth communication is received
and communicated about the positive things of the products and
the services, but at the same time the portion of the customers
communicate about the negative things of the products also.
Hence it is important to keep track on the both positive and the
negative things of the product.
About 87% of the builders are aware about the company Bharat
Heavy Electricals.Ltd. So we can say that the company has well
established its roots in the market. Among the customers who
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are aware about the company all are having the favorable
opinion about the company. So it is easy for the company for
promoting its new product in the market and also the company
doesn’t have to incur lot of expenditures on promoting its
control equipment’s.
5.2 Inferences:
- Very important of all is the marketing department function i.e it has to do
good advertisement and build brand awareness in the market.
- Job rotation, job enlargement, job enrichment needs to be done frequently
in EDN which would motivate a employee to do better.
- As BHEL faces tough competitions from private firms it must formulate
better policies that attract customers.
- In order to survive and to be a leader BHEL needs to come out of new
products continuously and increase its product line.
- BHEL also needs serious technology upgrading since in some production
units, the machinery being used is as old as 1980's.
- It needs young upgraded work force than an older force so it needs to
replace them gradually as time permits.
It needs also to eliminate the excess work force
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CONCLUSION
Objective 1: To study about the market potential for the control
equipment’s in BHEL-EDN Bangalore
BHEL has entered a new phase of growth. Its quick progress was aided by
the collaboration with international leaders in the field of power and control
electronics.
All the products have continued to be the undisputed leaders in the
categories, which is extremely creditable in the changing environment.
The current phase of innovation and business solutions has thrown up a
number of challenges and opportunities for a changed approach to business
itself, especially in the power sector.
The organization has to explore new ways to tap the market for business
and adopt strategies like lease financing, joint financing, joint bidding/
contortion, joint ventures deferred credit, financial packages, equity
participation etc., appropriately
BHEL-EDN has earned profits from the initial stage of its operations and it
is confident of meeting all the challenges that lies ahead and aims at
achieving the highest turnover.
A true corporate citizen of the world. Electronic division stands poised for greater
conquests in many challenging fields, using state of the art technologies and
keeping pace with the international standards.
Today BHEL is one of the most profiteering PSUs in the country. All the
products have continued to be the undisputed leaders in the categories, which
is extremely creditable in the changing environment.
BHEL is more than just a company, a responsible member of the eco-
conscious community, contributing towards the preservation of the
environment. A true corporate citizen of the world. Electronic division stands
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poised for greater conquests in many challenging fields, using state of the art
technologies and keeping pace with the international standards.
BHEL-EDN has earned profits from the initial stage of its operations and it
is confident of meeting all the challenges that lies ahead and aims at
achieving the highest turnover.
MY LEARNING
It was great to work in BHEL which is one among the NAVARATNAS. In
my 7weeks of learning of BHEL-EDN I was exposed to various departments
of BHEL this project work helped Mie to know how actually an organization
functions. I could relate my class room learning’s to actual working of an
organization. While undergoing the project at BHEL EDN I came to know
how actual marketing is done for B2B products.
Marketing management and business research in BHEL EDN was blend of
both class room sessions and practical exposure.
Through this internship, I got an opportunity to apply whatever
knowledge I had about management in real corporate world. Usually
internships will be restricted to only one department of the
organization but I got not only to study all the departments but also to
formulate strategies to improve overall organization by formulating
Organization Development Interventions. The findings and
inferences along with the details of research have been appreciated by
the management. After the completion of this research work
successfully, I am more confident to enter the most competitive
corporate world where I hope to get the most challenging tasks which
can be accomplished successfully using my skills and the
organizational resources.
I learnt how to carry on the research activities for the formulation of
strategic policies. I also learnt how to interact with the top level
executives and get the required information. I understood the
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importance marketing policies during this research activity. I was
able to channelize all the knowledge acquired from different sources
which taught me the usage of right thing at right time.
BIBLIOGRAPHY
PUBLICATIONS
1. BHEL manuals and publications.
2. Company magazines
3. Marketing Research
ISBN 0071009930,
Mc Graw Hill, 4th editions
Author: Thomas C. Kinnear
James R. Taylor
4. Marketing Management,
ISBN
4thEdition, Author: Philip Kotler
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WEBSITES
1. www.bhel.com
2. www.abb.com
3. www.siemens.com
4. www.google.com
5. www.honeywell.com
6. www.ecil.com
7. www.metroautomation.com
QUESTONNAIRE
1) Have you purchased electric control equipment’s from BHEL?
Yes
No
2) You mostly rely on
Single supplier
Multi supplier
3) What major criteria do you use while buying control equipment’s
The company brand name
The quality
The price
After sales service
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4) What are your sources of collecting information about a product or
service and its suppliers?
Industry websites
Word of mouth communication
Consultants
Sales Persons
5) Do you rely on word of mouth communication as a source of
communication?
Yes
No
6) How important is WOM as a source of information?
Very Important
Important
Neither/ nor
Less important
Not important
7) What percentage of time do you receive positive vs negative
WOM?
30vs20
40vs30
20vs30
50vs40
8) What percentage do you communicate positive vs. negative?
10 vs. 20
20 vs. 10
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30 vs. 20
30 vs. 40
9) Are you aware about Bharat Heavy Electricals Ltd.?
Yes
No
10) If yes what is your Opinion?
Favorable
Unfavorable
Don’t Know
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