SATISFACTION OF MANAGERIAL EMPLOYEES PERFORMANCE

APPRAISAL SYSTEM CAMPHOR ALLIED PRODUCTD LTD

Leading Manufacturer of Fragrance and Intermediates

Camphor & Allied Products Ltd.

 CONTENTS

PART 1-

1) STUDY OF PERFORMANCE APPRAISAL SYSTEM

Introduction
Objectives
Importance of performance appraisal system
Process
Models of performance appraisal system
Limitations
Performance appraisal of managers

PART 2-

2) OBJECTIVES OF THE STUDY

3) RESEARCH METHODOLOGY
4) COMPANY PROFILE
Location of various divisions of the organization
Board of directors
History and growth of camphor ltd.
Product range
Staff profile
Organizational structure
Personnel and general administration
Time office
Safety department
Production
Finance and accounts
Taxation
Computer department
Inventory control department

5) PERFORMANCE APPRAISAL SYSTEM IN CAMPHOR AND ALLIED PODUCTS

6) OBSERVATION AND ANALYSIS
7) FINDINGS
8) LIMITATIONS OF STUDY
9) SUGGESTIONS
10) CONCLUSION

BIBLIOGRAPHY
QUESTIONNAIRE
 PERFORMANCE APPRAISAL

INTRODUCTION

Performance appraisal is one of the traditional and most universal practices of the
management. It is a systematic and objective way of judging the relatives worth or ability
of an employee in performing his task. Modern management refers to an appraisal system
in which the employees merit like initiative, dependability, personality etc. are compared
with others and ranked and rated. The trend now a day is in the direction of attempting to
measure what the man does (performance appraisal) rather than what he is (merit rating).
Employees also wish to know their position in the organization. Performance appraisal
helps to identify those who are performing their assigned tasks well and those who are
not and the reason for such performance. Appraisals are judgments of characteristics,
traits and performance of others on the basis of which we assess the worth or value of
others and identify what is good and bad.

According to Flippo, performance appraisal is the systematic, periodic and an impartial

rating of an employees excellence in matters pertaining to his present job and his
potential for a better job.

A performance appraisal is an important tool for measuring managerial efficiency,

organizational effectiveness, monitoring and measuring the performance of employees.
MEANING
Performance appraisal is the process of evaluating the performance and qualifications
of the employees in terms of the requirements of the job for which he is employed, for
purposes of administration including placement, selection for promotions, providing
financial rewards and other actions which require differential treatment among the
members of a group as distinguished from action affecting all members equally.

In a nutshell we can say that performance appraisal is a process by which individual

employees behavior and accomplishments for a fixed time period are evaluated.
 OBJECTIVE

Appraisals serve to monitor the effort of individuals to integrate and coordinate

individuals effort into a cooperative endeavor and give feedback to the individual to
provide a means of correcting or commanding the efforts of individuals and to provide an
equitable and consistent basis of distributing rewards and penalties. It mainly concerns
itself with the following three purposes: -

a) ADMINISTRATIVE DECISIONS-

It can serve as a basis for job change or promotion.

b) EMPLOYEE DEVELOPMENT-

By identifying the strengths and weakness of an employee it serves as a

guide for formulating a suitable training and development programme to
improve his quality of performance in his present work. It serves as a
feedback to the employee. By letting the employee know how well he is
doing or where he stands with his supervisors it tells him what he can do to
improve his present performance and go up in the management hierarchy.

c) PERSONNEL RESEARCH-

This involves generation of manpower information

USES OR IMPORTANCE OF PERFORMANCE APPRAISAL

Performance appraisal is a significant element of the information and control system in

the organization. It can be put to several uses concerning the entire spectrum of human
resource management functions. Some common applications of performance appraisal
are given below-

Performance appraisal provides valuable information for personnel

decisions such as pay increases, promotions, demotions, transfers and
terminations.

It helps to judge the effectiveness of recruitment, selection, placement and

orientation systems of the organization.
It is useful in analyzing training and development needs.

It can be used to improve performance through appropriate feedback,

working and counseling employees.

Performance appraisal facilitates human resources planning, career planning

and succession planning.

It promotes a positive work environment, which contributes to productivity.

A competitive spirit is created and employees are motivated to improve

their performance.

Systematic appraisal of performance helps to develop confidence among

employees.

PROCESS OF PERFORMANCE APPRAISAL-

This process of performance appraisal has many stages and involves multiple
activities to be undertaken by an organization. These are usually format
determination, sharing evaluation, designing organizational inputs and reward
administration. The various approaches for appraisal are-

1) Intuitive approach- where the boss judges the employee based on his
perception of the employee behavior.

2) The self-appraisal approach- where the employee himself evaluates his

performance.

3) Group approach- where he is evaluated by a group of persons.

4) The conventional trait approach- where the boss evaluates the conventional
employee on the basis of presence or absence of certain traits likes integrity,
honesty, dependability etc.

5) On achieved results- where the targets are pre set jointly by the rater and
rates in a restricted sense.
 Setting performance standards
6 2

Taking corrective actions Communicating standards

5 3

Discussing results Measuring performance

4
Comparing the standards

THE PERFORMANCE APPRAISAL PROCESS

There are number of performance criteria which may be used to
measure the proficiency of an employee. It can be classified
into two main categories:

OBJECTIVE CRITERIA AND SUBJECTIVE CRITERIA-

Amount and quality of production, work sample tests, length of service,

amount of training necessary, absenteeism, accidents etc. are all
objectives criteria.

Rating of employees job proficiency by their superior, peers and subordinates, extent of
upward communication of ideas, degree of knowledge about corporate goal, contribution
to socio cultural values is all examples of subjective criteria.

ESSENTIALS OF AN EFFECTIVE PERFORMANCE APPRAISAL SYSTEM

1. Mutual trust
2. Clear objectives
3. Standardization
4. Training
5. Job relatedness
6. Documentation
7. Feedback and participation
8. Individual differences
9. Post appraisal interview
10. Review and appeal
 MODELS OF PERFORMANCE APPRAISAL-

Many form of rating are presently available each naming its strong points as well as
limitations. They may be classified into two broad category

PERFORMANCE APPRAISAL

TRADITIONAL METHODS MODERN METHODS

1. Confidential report 1. Assessment center

2. Free form or essay 2. HR accounting
3. Straight ranking 3. Behaviorally anchored
rating scales
4. Paired distribution 4. MBO appraisal
5. Forced distribution 5. 360-degree appraisal
6. Graphic rating scales
7. Checklist method
8. Critical incidents
9. Group appraisal
10. Field review
 TRADITIONAL METHODS OF PERFORMANCE APPRAISAL

1) Rating method-
The oldest and simplest method of performance appraisal is to compare one man with
all other men and place in a simple rank order. In this way ordering is done from best
to worst of all individuals comprising the group. This method takes into account
rating by more than one another rater. The ranks assigned are then averaged and
relative is determined for each member.

This method has two advantages of simplicity and naturalistic or naturalness. But it
has disadvantages of being subjective and the ranking becomes difficult when there
are even twenty or thirty cases. Also the magnitude of the difference in ability
between ranks is not equal at different positions.
As an answer to the last problem the paired comparison technique of ranking has been
evolved. In this method the rater compares each man in his group with every other
man with the final ranking of each worker determined by the number of time he was
judged better than others.

1) Rating scale method-

This method provides a kind of scale for measuring absolute differences between
individuals. This is method is of two types-

I) Discrete- the characteristic job knowledge may be divided into five

categories on a discrete scale exceptionally good, above average,
average, below average and poor. The rater can tick mark
category, which describes best he person being rated.
II) Continuous or graphic- where just above the category notation an
interrupted line is provided. The rater can tick at any point along its
length.
There are four kinds of standards used in rating scales, namely
numerical or alphabetical, descriptive adjective, man-to-man and
behavior sample. In man-to-man rating scale the standards are very
concrete because these are neither numbers nor alphabets (which do
not convey same meaning to all) nor descriptive adjective but are
persons, of varying ability whom the rater has selected and ranked in
the ability under consideration.

Thus a scale of men is created for each trait. The objective to this scale
is that its construction involves difficult and laborious procedure.
Persons used as standards by different raters are different.

In behavior sample standards, a series of actual description of behavior

are employed which is supposed to indicate varying amounts of the
characteristic being rated. The use of actual descriptions of behavior
reduces some of the differences in interpretation usually found among
different raters.

Frequently there is a tendency for the rater to pile up the ratings either
at he middle or at the highest end of the scale. To meet this the forced
distribution system is used where the rater is instructed about the
percentage of cases, which should fall in each category. For example,
job knowledge the following percentage must be used: poor-10%,
below average-20%, average-40%, above average-20% and
exceptionally good-10%.
2) Checklist method-

This consists of a list consisting of a number of statements about the worker and his
behavior. Each statement on this list is assigned a value, which are derived from
preliminary research in which the pooled judgments of person familiar with the job
are used. The rater is asked to place a plus sign or a question mark in front of each
statement depending on whether he feels the description applies, does not apply or
there is doubt. The method has the advantages of requiring only a report of facts from
the rater. Final rating is average of the scale value of the statement, which the superior
had checked.

Since the value assigned to different statements do not appear on the list the rater does
not know how highly he has rated a given individual. He also does not have to
distinguish among various categories for each of the several traits considered for each
the several employees working under him. The rater is more precise and less
ambiguous in his expression of the worthiness of the individual. The extent of
constant and halo error are also minimized.

3) Forced choice method-

The forced choice rating form contains a series of groups or statements. The rater
checks how effectively the statements describe each individual being evaluated. Each
statement carries weight, which is not indicated to the rater. There are a number of
variations. Sometimes all the statements may be either favorable or unfavorable. In
another, from four statements two positive and two negative the rater picks the most
appropriate and the most inappropriate respectively. It makes the performance
evaluation more objective.
4) Critical incident technique-

It involves three steps. A list of noteworthy (good or bad) on the job behavior, usually
of specific instances is first prepared which are vital for success or failure on job. A
group of experts then assigns scale values to them, depending upon the degree of
desirability for the job.

The third step is constructing a checklist that includes incidents, which define good
and bad workers. This method helps to identify key areas in which employees are
weak or strong. It emphasizes rating on the subjective evaluation of traits. Finally, the
supervisor finds counseling easier since he knows his subordinates weakness.

5) Confidential report-

This is a traditional form of appraisal used in most government organizations. A

confidential report is a report prepared by the employees immediate superior. It
covers the strengths and weaknesses, main achievements and failure, personality and
behavior of the employees. But it involves a lot of subjectivity because appraisal is
based on impressions rather than on data.

6) Free form or essay method-

Under this method, the evaluator writes a short essay on the employees performance
on the basis of overall impression. The description is expected to be as factual and
concrete as possible. An essay can provide a good deal of information about the
employee especially if the evaluator is asked to give examples of each one of his
judgments.
 7) Straight ranking method-

In this technique, the evaluator assigns relative ranks to all the employees in the same
work unit doing the same job. Employees are ranked from the best to the poorest on
the basis of overall performance. The whole man is compared with the whole man
without analyzing performance. The relative position of an employee is reflected in
his numerical rank.

8) Paired comparison method-

This is a modified form of man to man ranking. Herein, each employee is compared
with all the others in pairs one at a time. The number of times an employee is judged
better than the other determines his rank. Comparison is made on the basis of overall
performance. The number of comparisons to be decided on the basis of the following
formula-

N (N-1)\2

9) Group appraisal method-

Under this method, a group of evaluators assesses employees. This group consists of
the immediate superior of the employee, other supervisors having close contact with
the employees work, head of the department and a personnel expert. The group
determines the standards of performance for the job, measures actual performance of
an employee, analyses the cause of poor performance and other suggestions for
improvement in future.

10) Field review method-

In this method, a training officer from the HR department interviews line supervisors
to evaluate their respective subordinates. The interviewer prepares in advance the
questions to be asked. By answering these questions a supervisor gives his opinion
about the level of performance of his subordinate, the subordinates work progress,
his strengths and weakness, promotion potential, etc. The evaluator takes detailed
notes of the answer, which are then approved by the concerned supervisor. These are
then placed in the employees personal service file.
 MODERN METHODS OF PERFORMANCE APPRAISAL:

1) Assessment centers-

An assessment center is a group of employees drawn from the different work units. These
employees work together on an assignment similar to the one they would be handling
when promoted. Evaluators observe and rank the performance of all the participants.
Experienced managers with proven ability serve as evaluators. This group evaluates all
employees both individually and collectively by using simulation techniques like role
playing, business games and in basket exercises. Employees are evaluated on job related
characteristics considered important for job success.

2) Human resources accounting method-

HR is a valuable asset of the organization. This asset can be valued in terms of money.
When component and well-trained employees leave an organization the human asset is
decreased and vice versa. Under this method, performance is judged in terms of cost and
contribution of employees. Costs of HR consist of expenditure on HR planning,
recruitment, selection, induction, training, compensation, etc. contribution of HR is the
money value of labor productivity or value added by HR. difference between cost and
contribution will reflect the performance of employees.

3) Behaviorally anchored rating scales (BARS)-

This method combines graphic rating scales with critical incidents method. BARS are
description of various degrees of behavior relating to specific performance dimensions.
Critical areas of job performance and the most effective behavior for getting results are
determined in advance. The rater records the observable job behavior of an employee and
compares these observations with BARS. In this way, an employees actual job behavior
is judged against the desired behavior. The steps involved in constructing BARS are as
follows-

a) Identify critical incidents

b) Select performance dimensions
c) Retranslate the incidents
d) Assign scales to incidents
e) Develop final instrument

4) Appraisal by results or MBO-

The concept of management by objective (MBO) was developed by Peter Drucker in

1954. He called it management by objective and self-control. Since then MBO has
become an effective and operational technique of performance appraisal and a powerful
philosophy of managing. It is also known as work planning and review or goal setting
approach to appraisal.

MBO has been defined as a process whereby the superior and subordinate managers of
an organization jointly identify its common goals, define each individuals major areas of
responsibility in terms of results expected of him and use these measures as guides for
operating the unit and assessing the contributions of each of its members

The main steps involve din performance appraisal through MBO are as follows-

a) Set organizational goals

b) Defining performance targets
c) Performance reviews
d) Feedback

MBO is superior to other methods of performance appraisal. It offers the following

benefits:
 Ends-means chain
Role clarity
Objective appraisal
Motivation and commitment
Management development
Coordination

MBO suffers from the following drawbacks:

Difficulty in goal setting

Problem of participation
Lack of understanding
Time consuming and expensive
Inflexibility

5) The 360-degree appraisal technique -

Performance appraisal has come to occupy a pivotal place in human resource function.
The traditional merit rating which focused on personality traits was replaced by
performance appraisal with focus on work results. The concept of M30 transformed it
into a participative process. This led ultimately to the introduction of 360-degree
feedback system in the United States.

360-degree system involves evaluation of a manager by everyone above, alongside and

below him. Structured questionnaires are used to collect responses about a manager from
his bosses, peers and subordinates. Several parameters relating to performance and
behavior are used in questionnaires. Each manager is judged by a minimum of fifteen
colleagues, at least two of them being his bosses, four of them peer, and six of them
subordinates. The responses are presented collectively to the assesees in the form of
charts and graphs. Comments and interpretations are presented later. Counseling sessions
are arranged to solve the weaknesses identified in the 360-degree assessment. The 360-
degree assessment program is effective when used from the top down. The fact that the
manager at the top has also been administered the test convinces and they willing to go
through it as well.

SUPERIOR

PEER EMPLOYEE
PEER

SUBORDINATE

FOUR INTEGRAL COMPONENTS OF 360-DEGREE APPRAISAL

 LIMITATIONS OF PERFORMANCE APPRAISAL

The main problems involved in performance appraisal are as follows:

1) Errors in rating-
Performance appraisal may not be valid indicator of performance and
potential of employees due to the following types of errors:
a) Halo effect- it is the tendency to rate an employee consistently high or low on
the basis of overall impression. One trait of the employee influences the
raters appraisal on all other traits.

b) Stereotyping- this implies forming a mental picture of a person on the basis of

his sex, age, caste or religion.

c) Central tendency- it means assigning average rating to all the employees in

order to avoid commitment or involvement. This is adopted because the rater
has not to justify or clarify the average ratings.

d) Constant error- some evaluators tend to be lenient while others are strict in
assessing performance. In first case, performance is overrated while in second
case it is underrated.

e) Personal bias- performance appraisal may become invalid because the rater
dislikes the employee. Such bias may arise on the basis of regional or
religious beliefs and habits or interpersonal conflicts.

f) Spill over effect- this arises when past performance affects assessment of
present performance.

2) Lack of reliability-
Reliability implies stability and consistency in the measurement. Lack
of consistency over time and among different raters may reduce the
reliability of performance appraisal.

3) Incompetence-
Raters may fail to evaluate performance accurately due to lack of knowledge and
experience. Post appraisal interview is often handled ineffectively.
4) Negative approach-
Performance appraisal loses most of its value when the focus of
management is on punishment rather than on development of
employees.

5) Multiple objective-
Raters may get confused due to two many objectives or unclear objectives of
performance appraisal.

6) Resistance-
Trade unions may resist performance appraisal on the ground that it involves
discrimination among its members.

7) Lack of knowledge-
The staff appraising performance of employees might not be trained and experienced
enough to make correct appraisal.

8) Hypercritical or Horns effect-

It is the tendency of the superior to rate people lower than their
performance justify.

9) Reluctant to play God-

Some managers are reluctant to Play God by judging others. Accepting the
responsibility for being and judge for the future of another person causes sense of anxiety
in some people. The aggrieved employee is left with the feeling that the superior is so
arbitrary in his judgment, which is very frustrating for an honest and impartial superior.

10) Opportunity bias-

This results when the amount of output is influenced by factors beyond
the control of employees. Some employees have better working
conditions, supportive supervisors, and more experienced co-workers
and hence there output may be greater than others with identical
tasks. In such a case comparison between the performances of two
employees will have limitations. Moreover, the characteristic of an
individual group makes a direct effect in the performance. Cohesive
group with high morale can produce more than less cohesive groups
with low morale.
 PERFORMANCE APPRAISAL OF MANAGERS

Appraisal of managers is very important. But it is more difficult

because it cannot be measured in quantitative terms. Managerial
appraisal should measure therefore, both performance in
accomplishing goals and performance as a manager.

1) Performance in accomplishing goals-

A manager is responsible for achieving the targets of his work unit. The
extent to which these targets are achieved is a good criterion for
evaluation.

2) Performance as managers-
Although an impressive record of setting and accomplishing goals is an
indicator of a managers performance, this standard cannot be used in
all cases. Managers achieve organizational goals by performing the
basic managerial functions. Therefore, a manager can be appraised on
the basis of how well he understands and undertakes these functions
of planning, organizing, staffing, directing and controlling. Each of
these functions involves a series of activities. These activities can be
taken as standards of performance. A five-degree rating scale can be
used to rate the performance of managers. Weights to the scale can be
assigned for those activities, which are clear and adequately known.

FEEDBACK AND PERFORMANCE COUNSELLING

An individual is interested not only in knowing as to where stands but

also as to what he can do to go up in the hierarchy. He may therefore
need a feedback and subsequent follow-up action. This feedback has to
be supplemented by counseling. In this program the interchange of
ideas between the parties involved (managers and subordinate) is
directed towards a problem or a need that required in depth attention.
As the evaluation whether positive or negative can be useful it is
communicated to the employee. The rater can assess the abilities of
the employees or can suggest suitable remedial actions.
 OBJECTIVES OF STUDY

1) To study the performance appraisal system in camphor and allied products

limited.

2) To study the method used for performance appraisal in the organization.

3) To study the satisfaction level of the employees after performance appraisal.

4) To provide suggestion if necessary.

 RESEARCH METHODOLOGY

No work can be completed without the research methodology. Research methodology is

an important tool which provides a technique to conduct the study efficiently and
effectively. Research methodology is a way to systematically solve the research problem.
It may be understood as a science of studying how research is done scientifically.

Research design: - research design is the plan, structure and strategy of investigation.
Research design of the project will be exploratory research.
Exploratory research is often the initial step in a series of studies designed to supply
information for decision making. The purpose of this research is to explore the potential
problem and opportunities present for the decision situation.

The sample size of the research will be 25 employees.

The source of information will be the primary data which is collected through the survey
of 25 employees of the company.

The secondary data like books, company annual reports, journals, and websites will be
accesses to increase the knowledge regarding the topic of study.

Tabulation and graphical representation shall also be used for data analysis.

LOCATION OF VARIOUS DEVISION OF ORGANIZATIO

S.No. Location Type Address

1 Registered Office Plot No. 3, GIDC Industrial Estate, Nandesari,

Vadodra District , Gujarat - India

PinCode :391340

Phone :6403883,,,

Fax :91-22-2023892-6441693,
2 Corporate Office Jehangir Building, 133, M G Road,

Mumbai , Maharashtra - India

PinCode :400001
3 Branch Office 907, Surya Kiran, 19, Kasturba Gandhi Marg,

New Delhi , Delhi - India

PinCode :110001

Phone :23351473 / 74 / 75,,,

4 Branch Office 30, Ist Main Road, CIT Nagar,

Chennai (Madras) , Tamil Nadu - India

PinCode :600035

Phone :24334468,24334469,,
5 Factory/plant P.O. Clutterbuckganj

Bareilly , Uttar Pradesh India Pin code-243502

Board Of Directors
S.No Name Designation
1 Mr. Harshul Dalai Chairman and Managing director
2 Mr. H R Prasad Director
3 Mr. J K Setna Director
4 Mr. S M Mehta Director
5 Mr. Shobhan M Thakore Director
6 Mr. Nina H Dalai Director
7 Mr. S R Laghate Executive Director

BRIEF HISTORY AND GROWTH OF CAP

Camphor and allied products ltd (CAP) was founded in 1961 by

SHRI JAYANT DALAL, a man largely responsible for breakthrough in the Indian
Turpentine industry, as the first Camphor and terpene based chemicals producing
company in India.
CAP started production in 1964 with very few items in its product range. Soon after
CAP took strides of development and rapidly enlarged its scale of operations in both
facilities and personnel.

Subsequently, within short span of time through combination of technical and creative
competence, CAP has received tremendous qualitative and quantitative growth and
today CAP factory is turning out a total of over 40 terpene based quality products and
expended polyethylene, polystyrene and cross linked expended polyethylene foam-a
special plastic foam. Its star products are- camphor, menthol, thymol, astrolide, pine
oil, resins, and terpeneols.

CAP products have wide and variety of uses. Its products are mainly used in other
industries as raw materials. They impart the gloss to painted surfaces, the softness to
rubber mattresses, the tenacity to tyres, suppleness to leather and fragrance to soaps,
cosmetics and perfumes. CAPs products also find application in pharmaceuticals. Its
products are also used in medicines, cough syrups, Vicks, balms etc. as well as pan
masala.

To maintain its number one position company has given top priority to R&D. CAPs
multi chemicals research center was established as a self sufficient ultra modern
research center at Baroda a stepping stone to greater progress for the terpene industry
which is equipped with latest gadgets and machines and well qualified staff to
undertake new research and development, new technologies, test and control the
quality of its own products and check the supplied raw material to look into specific
requirement of the customers.

Excellence in quality is the prime motto of the company. To stay ahead of competition
CAP is always quality conscious and is constantly alert to changes and anticipates
future trend and discovers new areas.
Continued excellence in quality is the main objective of CAP to boost exports. CAP
has established very good relationship with overseas customers and tie-ups with
influential companies abroad. Many of CAPs outstanding organic products are being
largely exported to several developed countries including U.S.A., France, Japan,
U.K., Italy and Holland thus contributing to Indian economy by way of collecting
foreign exchange.

Flexible and creative management is the main factor of CAPs phenomenal growth.
Through diversification of its activities CAP has been creating more and more
employment avenues. Today over 1000 personnel are earning their livelihood by
direct employment in CAP and more and more than 2000 by indirect employment.

CAP has history of harmonious relationship between the management and the
workers. Its employees are not only known but also act as camphor family.

Company has provided various facilities such as building of housing colonies, full
fledged 20 bedded hospital, school, co-operative society, temple, club library,
swimming pool etc. for promotion of cultural and recreational activities there are
camphor cultural association, camphor club, camphor ladies club etc. Other facilities
provided to its workmen includes bus for school going children, canteen giving
healthy and subsidized food, loans for purchase of house vehicles.

CAP is also the recipient of several prestigious awards such as govt. of India award
for excellence in printing, SIR P.C.RAY award for the development of indigenous
technology and export award for export promotion council and the honor for
production of menthol from delta 3 carene with indigenous technology by its own
R&D center for the first time not only in India but also in the world.
 PRODUCT RANGE OF CAP

Located at clutterbuckganj on the Bareilly- Delhi national highway and about 6 km

from Bareilly city, CAPs factory is turning out a total of over 40 terpene based
quality products.
 CAP is the largest manufacturer of camphor in India. Besides its other star products
are menthol, thymol, astrolide, pine oils, resins, and terpineols. Most recently added
products are expanded polyethylene, expanded polystyrene and cross-linked
polyethylene foam.

Its major products are-

CAMPHOR AND ISOBORNEOL-

Saraswati camphor BQ
Saraswati camphor GF
Camphor USP
Saraswati camphor tablets
Isoborneol powder

TERPINEOLS\ PINE OILS

Pine oil commercial

Pine oil special
Terpineol pure
Terpineol perfumery
Terpineol MU\PG

TERPENE RESIN

Capolyte CP-70
Capolyte CP-90
Capolyte CP-120

PERFUMARY PRODUCTS
 I.B.A. perfumery
Terpinyl acetate perfumery
Ketone-101
Capinone
Citwanene

SPECIALITY CHEMICALS

P.M.P.H. for rubber

BY INTERMIDIATE PRODUCTS
Sodium acetate trihydrate
Pine tar oil 20
Camphene
Alpha pinene
Delta-3-carene
Astrone
Capolene
Dipentene oil
Fenchone oil
Longifolene
Isolongifolene
Spent catalyst

Facility Summary

The company was commissioned in 1964 and growing fast, the plant is located at
Bareilly in West Uttar Pradesh, 250 km from New Delhi, served by rail and road. The
plant handles 20,000 MT volumes of raw materials and finished products annually and
incorporates latest in technology and equipment.

They carry out all conceivable chemical operations such as fractionation, esterification,
saponification, hydrogenation, dehydrogenation, oxidation, peroxidation, pyrolysis, etc.
All processes are monitored by well trained technical personnel with help of latest in
instrumentation and quality control.
Over 300 dedicated workmen work zealously for bettering performance of the plant.
Efficient effluent treatment plant controls pollution limits set by the authority. The plant
is totally free of air and liquid pollution and maintains strict vigil all the time to protect
environment and people.
For the benefit of workmen and neighboring community, they have their own hospital run
by dedicated doctors. Also primary and secondary school for the children of the
community. Established in 1973 and located in sprawling 20 acres green lawns at
Nandesari, Baroda, only 45 minutes by air from Mumbai, there R&D centre has
contributed immensely to the terpene chemistry having developed several new products
for the first time in the world. It is well manned, well equipped and aesthetically set up
with excellent infra structure and has several patents to its credit.
In addition to R&D work for their own manufacturing activity the companies are well
poised to undertake contract research for multiple step synthesis of organic molecules,
process development from laboratory to pilot plant and process evaluation.
 Staff Profile
Total Staff Strength : 1171. We have a team of well qualified personnel who are
committed towards quality in everthing they do

Certifications / Awards

We have ISO 9001 Certification.

Fast Facts

Company Name Camphor & Allied Products

Jehangir Building
Address
133, M.G.Road
City Mumbai State/Province Maharashtra
Zip/Postal Code 400 001 Country India
Tel (1) 91 22 267 0833 Fax (1) 91 22 267 0490

ORGANIZATIONAL STRUCTURE OF CAP

An organization is a group of individuals coordinated into different levels of authority
and segments of specialization for the purpose of achieving the goals and objectives of
the organization.

The essence of an organization structure is that the people who work together require a
defined system or structure through which they relate to each other and through which
their efforts can be coordinated. The organizations goals can be achieved suitably if the
behavior of the workers and the composition of the organization can be predicted and
integrated cooperatively. The formal organization structure attempts to give order and
unity to the action and efforts of those who work together.

In CAP, the organization set up is informal instead of formal.

There is no clear-cut scalar chain and unity of command also does not properly exist.
There is a lack of proper communication skills.

As shown in the organizational chart all the managers are directly reporting to the
Executive Director. The account manager, head of the department, at the branch office,
handles finance department, which is accountable to the Vice President (finance) at the
Mumbai office. But the Vice President (finance) at Mumbai takes all the major financial
decisions.

General manager (marketing) looks after all the marketing activities and all the
branch\zonal sales offices that are situated at Delhi (north), Calcutta (east), madras
(south), Aslali (west), Banglore, Madurai, Vijawada, and Mumbai (central office).

Vice President looks after the multi chemical research center. From there successful
projects are forwarded to Bareilly

PERSONNEL AND GENERAL ADMINISTRATION

In CAP there is no clear cut demarcation between general and personnel administration,
both seems to be intermingled with each other.

The total administrative department includes all the administrative work, general welfare,
canteen, time office; transport, safety and security, E.S.I. and P.F. work. It is headed by
administrative manager who has one administrative officer and has one personnel officer
and reports to the Executive director.

Personnel administration more or less is the responsibility of the personnel officer who
looks after the grievances of employees, their recruitment, promotion, dismissal,
remunerations, employees training and their development, legal matters concerned with
the state of unions etc.

RECRUITMENT AND SELECTION

The personnel department is concerned with the recruitment and selection of employees
in CAP. Generally, giving advertisements in the national newspapers does recruitment
and selection of employees for the managerial post. Directly addressed applications are
also entertained at times. No campus interviews are conducted for executive positions.
There is no criterion to conduct psychological test or written test before personnel
interview.

Recruitment of workers is done by applications through employment exchanges or direct

as and when need arises.

Proper scanning of the aspirants by the interview board does selection. On the basis of the
education, experience, personality etc. each member of the interview board rates the
aspirants on the prescribed Rating form and a common opinion is framed and sent to the
personnel department for the Directors approval. The director does final appointment

After the final approval, personnel department issues the appointment letters to the
successful candidates.

TRAINING AND DEVELOPMENT

Training is the process of increasing the knowledge and skills for doing a particular job.
It is an organized procedure by which people learn knowledge and skill for a definite
purpose. The purpose of training is basically to bridge the gap between job requirements
and present competence of an employee. Training is aimed at improving the behavior and
performance of a person.

Training and development-

Employee training is distinct from management development. Training is a short-term

process utilizing a systematic and organized procedure by which non-managerial
personnel learn technical knowledge and skills for a definite purpose. It refers to
instructions in technical and mechanical operations like operation of the machine. It is
designed primarily for non-managers. It is for short duration and for a specific job-related
purpose.

On the other hand, development is a long-term education process utilizing a systematic

and organized procedure by which managerial personnel learn conceptual and theoretical
knowledge for general purpose. It involves philosophical and theoretical education
concepts and it is designed for managers. It involves broader education and its purpose is
long-term development. In the words of Campbell training courses are typically
designed for a short term, stated set purpose, and such as the operation of some pieces of
machinery while development involves a broader education for long-term purpose.

CAP does not have any specialized training department that can provide training in
various fields to the employees. The management believes in on the job training.
Seminars are organized but infrequently. Few executives get the opportunity to attend the
seminars.
 GENERAL WELFARE AND REMUNERATION

Probation period for a newcomer various from six months to one and half year depending
on the position after which the person gets permanent placement and is given regular
fixed pay scale. Extra-qualified person can get special scales.

Although the CAP people are not considered very good pay masters but many special
welfare facilities are provided to the employees and thus this compensates the pay
packets indirectly. Along with the E.S.I., medical group

Insurance and contributory provident fund schemes, many other facilities like subsidized
canteen, housing, education, transport, library, recreational facilities etc. are provided to
the employees.

An important feature of CAP regarding C.P.F. is that it is exempted by the govt. from the
usual procedure of depositing the money to the P.F. department. The employees need not
approach the P.F. office and obtain the money from the trust.

Every member shall contribute to the fund during the period of his service at the rate of
12% of his salary or wages and D.A. and cash value of food concession payable if any.
Such percentage shall be deducted from the members salary or wages at the time of each
periodical payment and shall be paid every month by the company within 15 days of the
close of the month to the Board of Trustees and shall be credited to the account of the
members in the books of the fund.

Out of the employees contribution, the company shall pay 12% in respect of every
member to the Regional Provident Fund Commissioner, U.P. Kanpur, being the
employees contribution towards the family pension. Funds contribution should be within
15 days to the close of every month.
Regarding the E.S.I. scheme, company has to deposit the contribution of 1.75% of
employee + 4.75% of employer in the E.S.I. department all positively by 20 th of every
month.

In the event of an industrial accident all the required medical facilities including interim
cash receipt is provided to the concerned person, a job is offered to next of kin along with
the usual financial benefits in the case of death.

Promotions of executives are done on the basis of seniority as well as on performance

and merit while workers are promoted strictly on basis of seniority because of workers
union interferences.

Performance appraisal is done by the heads\in charge of the departments concerned. For
unskilled and semi skilled workers only attitude, cooperation, job knowledge, quantity
and quality of work are considered but for skilled or supervisory staff few other factors
like initiative, personality, supervisory ability, attendance, judgment etc. are also
considered.

TIME OFFICE
Time office is one of the very significant departments of any industry. It maintains the
attendance and leave records of all the employees. Administrative officer who has a team
of 4 clerks under him heads time office and they all keep the attendance record of all the
employees shift wise.

In all there are 4 shifts in CAP. These are morning shift (A shift), evening shift (B shift),
night shift (C shift) and general shift (G shift). There is a provision of card punching for
all the employees except managers in order to make the attendance.

Deductions from salary are made after allowing 5 minutes delay in duty time.
Supervisors, managers and officers are exempted from such deductions. Attendance of all
the employees is maintained in the attendance register in the form of computerized form
12 of every month in order to calculate the salary and wages of all the employees. Pay
roll is closed on 20th of every month.

Every employee is provided with certain leaves. The worker can avail 7 casual leaves
(C\L), 9 medical leaves (M\L). Earned leaves are calculated by dividing actual working
days by 20. Supervisors can enjoy 30 days P\L and 10 days C\L. Managers are given earn
leave according to their grades. C\L and P\L are same as in the case of supervisors and
employees.

Workers can accumulate their E\L up to 40 days. There is encashment provision for 10
days but beyond that they have to be forfeited. The E\L can be availed four times in the
year by a worker and P\L only three times a year. M\L can be accumulated up to 27 days
after which it is lapsed. If illness exceeds 9 days then leave without pay is granted.
There are 12 paid holidays that can be availed in the year. Workers reporting on paid
holidays are given overtime payment. Overtime facility is also provided to the workers
after completion of 8 hours of duty at double rate basis. Time office keeps 3 years
records. It entertains all types of leave applications on prescribed forms.

SAFETY
Increasing industrialization is threatening the very being of the society. The life of
industrial workers is full of risks and hazards. Adequate measures should be taken to
understand these hazards, create awareness about them, device ways to eliminate them
and control these hazards.

Factories act formulated in 1948 deals with the welfare and safety of workmen working
in the factory. There are some legal, economic and social necessities for safety. Although
safety is a staff function but it is a line responsibility.

As far as CAP is concerned safety officer who reports to the administrative manager
looks after safety department. The safety officer has one safety supervisor, a safety team
of 10 fire fighters and a security team of 24 security guards. Security staff includes 12
watchmen and gunmen hired from the approved security agencies.

Safety department in CAP performs the following functions-

1. To ensure the implementation of legal requirements.

2. Lookout for unsafe work conditions.
3. Create awareness in the minds of workmen.
4. Maintenance of all safety equipments.
5. Control and supervision of hazardous operations.
6. Safety department may do entry into a confined space.
7. Selling safety safety department motivates and counsels the people to promote
safety. Safety lecturers are given, quiz competitions are held and awards are given
for safety.
 8. Safety department maintains the safety records that are fire occurrences, analysis
and prevention.
9. Safety training programmes are undertaken to educate the new people and refresh
the old ones.

Personnel protective equipments (PPE), gum boots, hand gloves, breathing sets, chemical
goggles, and face protection devices are given to the workmen. More over they have-

1. Carbon dioxide fire extinguishers.

2. Dry chemical power extinguishers.
3. Hydrant system.
4. Steam applicators.
5. Foam generation methods.
6. Emergency bathing showers.
7. Fire alarms.

The different types of masks used are-

Dust mask
Ammonia mask
Organic mask
Acid mask

These masks have the capacity of two hours. An employee can work up to two hours in
high fumes atmosphere.

Overall it can be said that CAP has sufficiency to combat safety methods.
 PRODUCTION

Production is the foundation on which every organization is built. Production process

basically involves optimum use of resources at optimum cost and manufacturing of the
desired quality and quantity of goods and services.

In CAP production manager who is accountable to the works manager heads production
department. The production manager has working under him the assistant production
manager, production superintendent, plant engineers and supervisors and operatives.

CAP has achieved tremendous qualitative growth and today CAPs factory is turning out
a total of over 40 terpene based quality products. Its main products are- camphor, pine
oils, resins, terpeneols etc.

CAMPHOR PLANT-

This is the main and most important product of the company. 75% turnover of the
company is due to this product. The main raw material for producing camphor is alpha
pinene that is now imported from China. Firstly alpha pinene was extracted from
turpentine oil, which was the main raw material before.
PROCESS-
Alpha pinene

Ti catalyst isomerization

Crude camphene

Distil

Pure camphene
Esterification
(Acetic acid)

Crude isoborneol acetate

Distil

Pure isoborneol acetate

Saponification (NaOH)

Isoborneol

Cu-Ni catalyst (dehydrogenation)

Crude camphor

Distil

Pure camphor
APPLICATION-
About 60% of camphor produced is used in puja.

Moreover, it is used in pharmaceutical industry, as a plastecizer, in defence industry (in

Cordite).

RESINS-

There are mainly two resins that are manufactured in CAP.

1- Capolyte C.P. Resin

PROCESS-
Carene

Capolyte C.P. resin

APPLICATION-

Used for the preparation of fevicol, shoe adhesive, varnishes and tyre industry for
binding rubber (rubber industry).

2- Caprez

PROCESS-
Alpha pinene

Caprez
APPLICATION-

Used mainly in pharmaceutical industry, chewing gums and band acids etc.

TERPINEOLS-

They are manufactured from alpha pinene, lower grade ones is called pine oils and higher
grade ones is called terpineols.

APPLICATIONS-

Pine oil commercial- used as solvent in paint industry.

Pine oil technical- used in good paints.
Pine oil special- used in making boot polishes, mason polish for floors.
Pine oil extra special-in copper flotation extraction.
 FINANCE AND ACCOUNTS

SET UP OF FINANCE DEPARTMENT

Financial stability is highly essential for the smooth running and luxuriant growth of any
organization. The success of Finance department lies, not in the availability of abundant
funds but in the effective and efficient use of available funds. Thus with a competent and
efficient financial staff, an industry can achieve high targets by maximum and optimum
utilization of funds.

The Finance Manager accountable to the Executive Director heads the finance
department in CAP. There are three sections in the finance department viz. the Account
section, the Taxation section and Computer or Data Processing section. Each section has
an officer who is in charge of all the activities carried out in that section. He has a staff of
supervisors who supervise the work done by the clerks of that section.

ACCOUNTS SECTION

An Accounts officer who reports to the Finance Manager heads the Accounts section. The
Finance Manager in turn reports to the Vice President (Finance). Accounts officer has a
staff comprising of Chief Accountant, Assistant Accounts officer and assistants.

The accounts department performs the following functions: -

1) It prepares financial reports like: -

(a) Balance sheet
(b) Profit and loss accounts
(c) Cash and fund flow statement
(d) Inventories and stock statements of various departments.
 2) Payment of wages, salaries and T.A.
3) Maintains various debit/credit records party wise and product wise.

4) Issues cheques to creditors in time.

5) Preparation of invoices.

Camphor and Allied Products Ltd. was incorporated in the year 1961 with a share capital
of Rs. 60 lacs consisting of 50,000 equity shares of Rs. 100 each and 10,000 preference
shares of Rs. 100 each.

CAP has a present Share capital of Rs. 513.37 lacs and reserves of Rs. 4719.93 lacs to get
the net worth of Rs. 5233.30 lacs. Along with this, it also borrowed Rs. 6701.50 lacs.
This total capital is distributed among different assets as follows: -

(a) On fixed assets 3238.29 lacs

(b) Investors 7.10 lacs

(c) Current assets 3456.43 lacs

It has only equity shares and no preferential shares. The face value of one share is Rs. 10.
The profit before tax (E.B.T) for the current year is Rs. 3157 lacs. Proposed dividend for
the current year is 15%.

The company has achieved a total turnover of Rs. 9224 lacs during the year as compared
to Rs. 7414 lacs for the previous year, registering an increase of 26%. The production of
the main product Camphor has gone down from 3163 M.T. to 3142 M.T. during the year
and the sales from 3566 lacs to 3151 lacs.

The companys continuous thrust on exports led to Substantial increase in export earnings
over previous year despite of set back in Expanded Polythene export market developed
by the company in the previous year. The export turnover during the year has been Rs.
163 lacs as against Rs. 114 lacs representing an increase of over 40%.

Financial resources are normally commercial banks and some financial institutions like
I.D.B.I, I.C.I.C.I, International Development Bank etc. Commercial Banks are
specifically serving as short-term sources. These banks are namely Bank of Baroda, State
Bank of Patiala and Dena Bank. For Short-term finance, only cash credit and over
drafting are preferred. In case of demand loans, the formalities required are very complex
so this is not preferred.
 TAXATION

Taxation is an instrument used by government to achieve its social and economic

objectives. Taxes are the prices ones pay to enjoy the benefits of law and order, a
harmonious relationship with other countries, protection against external aggression,
access to essential services like electricity, water, transport, health, education etc. It is
therefore obligatory to pay taxes.

In CAP, a finance manager who has under him an assistant finance manager and accounts
officer heads finance department. Further, there are supervisors and clerks under him.
Taxation is a prominent part of the finance department. CAP has around 40 tax items.
Mainly it has to deal with sales tax, excise duty and now also with VAT.

SALES TAX

There are two types of sales tax, which are imposed, central sales tax (C.S.T) and state
sales tax (in U.P. it is called UPST). Rate of C.S.T. is 10% (with out concession) but
against concession form (form C) which is issue only for product purposes, only 2%
C.S.T. is to paid that was 3-4% previously.

C.S.T.-

Government has prescribed a number of forms.

1) Form A-

This is the application form for obtaining C.S.T. registration from sales tax department.

2) Form B-

C.S.T. registration is issued in form B.

3) Form C-

The registered dealer for availing concession rate of C.S.T issues this. This is used in four
cases, manufacturing goods, mining, and packing of goods and for resale.

4) Form D-

Instead of form C, government to avail confessional rate of C.S.T issues form D.

5) Form E1 and E2-

If some items have consecutive sales then to save the multiple tax, form E1 followed by
form E2 and so on are issued against the form C.

6) Form F-

In case of stock transfer, there is no imposition of sales tax if form F is attached certifying
the receipt of stock.

7) Form G-

This is also known as indemnity form. In case form C sent by a party is lost in the transit,
form G is sent to party for a duplicate form.

8) Form H-

This form is to get exemption from sales tax on exports.

U.P.S.T-

Government has prescribed a number of forms for U.P.S.T.

Form 31-

If purchases are made from outside U.P. form 31 has to be submitted to the sales tax
department within 24 hours of the receipt of goods otherwise a penalty is to be paid.

Form 3B-

Any manufacturer who purchases raw material for manufacture of notified goods will not
pay any sales tax against form 3B.

Form 3D-

For availing concessional rate of purchase of material for their own consumption,
government issues form 3D.

If state sales tax is less than concessional rate of C.S.T., (at present 4%) the state sales tax
will be applicable for sale of material outside the state. If state sales tax is more than full
rate of C.S.T. and if party does not give form C then state sales tax will be applicable.

Every businessman or industrial organization has to submit a monthly return (monthly

statement) to the local sales tax office along with the cheques (separately prepared for
C.S.T. and U.P.S.T.) of tax collected positively by 20th of every month. If money is not
paid through cheque, it can directly be deposited through treasury challans up to 30 th of
every month. But if payment is delayed then 2% per day penal interest is charged by sales
tax office. These monthly returns include all types of information and details of the sales
made (name of the party, total value, amount of sales tax, forms used, name of the
product, its type, rates, packing etc.).
 CENTRAL EXCISE DUTY (CENVAT)-

Central value added tax is paid only for production units or manufacturing units. All
information regarding CENVAT is written in CENVAT register. Credit is taken on
personal ledger account and then duty is paid. The duty that is not paid by CENVAT is
paid through personal ledger account. It is paid monthly that is monthly return till 10th of
every month is to be submitted to central excise department with all proves and
documents.

Export is done in two ways- first is direct export and second is indirect export. Direct
export is again divided into two categories.

1) Under self-removal procedure (SRP)- in this type material is packed, sealed and
exported by the company.
2) Physical control- export information is given to the jurisdiction excise inspector
within 24 hours and in the presence of the inspector the material is sealed and
exported. Inspector also gives the sealing certificate, which is given to the
customer.

In CAP both SRP and physical control procedures are followed. No duty is paid for
export. But if the material is not exported within 6 months then duty on export is paid
with interest. Excise duty of 14% is paid on camphor, 2% CESS is paid and 1%
secondary higher education CESS is paid.

VALUE ADDED TAX (VAT)-

VAT is a type of sales tax that is paid within the state. 4% VAT is paid on all products of
CAP. Previously in place of VAT UP trade tax was paid.
 COMPUTER

Computers have helped to revolutionize the way people conduct their business and
personal work. They have put a wide range of capabilities on the desktop of the user.
With the advent of computers, a whole new world of possibilities is opened up for better
office management. Computers have made work easier, less time consuming and reliable.

The E.D.P. officer heads computer section in assistance with a supervisor and few
operators. E.D.P. officer reports to the finance manager. Computer

Section in CAP is mainly concerned with five areas of work namely-

I. Pay roll
II. Finance
III. Sales
IV. Excise
V. Material process

Inputs for payroll are-

A. Data from accounts department

B. Number of days and earning from time office
C. Personal information

In output we get-

A. Printed pay slips

B. Earning and deduction statement
C. Overtime statement
 D. Cost center wise details
E. Cumulative salaries for bonus calculations
F. Individual leave records

For financial statements inputs are-

Received vouchers
Payment vouchers
General credit and debit vouchers

In the output of finance we have-

Checklists
Cash and bank book
General voucher register
Main ledger
Personal ledger
Creditors ledger
Trial balance
Balance sheet

In material process the inputs are-

Material receipt memos (MRM)

Rejection memos
Indents (issues)
Issue returns
Bill sheets
In material process the outputs are-

Check lists
Bills
Stock statements
Receipt register
Rejection register
Value adjustment register
Stores ledger (including value)
Inventory ledger

To get the sales statement the inputs are-

a) Production details
b) Indents and dispatches details

Against these information we get-

DAILY

a) Checklists
b) Stock statements
c) Sales resale memo (based on which G.Ps are prepare for excise purpose)
d) Dispatches report
WEEKLY

a) Product wise sales statements

b) Branch wise sales statements
c) Finished product report

FORTNIGHTLY

a) Bank statements for loan purposes

b) Region wise invoice statement

MONTHLY

a) Sales register
b) Product register
c) Cumulative statements (debit and credit register)
d) Tax register

The computers print the entire price list for excise purpose. Apart from this all G.Ps
statements, export goods statements, and details of excise paid etc can also be printed.

Major departments to which IT is linked in CAP are-

Accounts department
Stores department
Taxation department
 Salary and manpower department
HR department for recruitment and selection.

EDP collects data from all the departments process them and then provides the required
information to the management.
 INVENTORY CONTROL DEPARTMENT

Set up of inventory control department

Inventory control is an unavoidable part of any organization. Inventory control implies to

the technique of maintaining stock keeping items at the desired level whether they are
raw materials, goods in process or finished products. It is important due to a large number
of factors like scarcity of funds, dynamic nature of the environment changes in
technology and cutthroat competition. Care should be taken to maintain the inventory at
an optimum level. There should be minimum blocking of the in inventory to achieve
effective and efficient utilization of funds. On the contrary, shortage of inputs or raw
materials should not occur so as to hamper the entire production process. Thus a proper
balance of inventory should be maintained so as to achieve production in the most
optimum manner.

In CAP, inventory control department is headed by a manager who regulates the

inventory of purchases (raw material and other inputs) with the help of a purchase officer,
supervisor and clerks and also of finished product\by products with the help of sales
officer, supervisor and clerks.

PURCHASE DEPARTMENT

The purchase department carries purchase of raw material, packing material, spare parts
and components, electrical appliances, plant and machinery items, laboratory chemicals
and equipments, safety equipments, consumable items of day-to-day use and stationery
etc. In order to affect such purchase, the purchase department receives requisitions from
different department of the company. The purchase order is placed with the party for
supply of material.
REQUISITIONS-

The requisitions come from various departments signed by the head of the department
and sent to the stores department which then gives consumption trend of the current year
and two past years of the particular item on the requisition. The requisitions are then
forwarded to the purchase department, which consults the concerned departments for any
change in their requirements. It then gives item wise rates on the requisition.

INVITATION OF QUOTATIONS-

The purchase department gives rates of material on basis of past purchases. If it thinks
that the rates might have changed, it invites quotations from reputed
manufacturers\suppliers of the item in quotation. After the receipt of quotations,
requisitions are sent back along with such quotations to the head of department so that he
may get an idea of the purchase and may also review such requisition in terms of quality,
quantity, number, brand and price of the item.

After the approval of the departmental head requisitions are put to the sanctioning
authority that is the vice president of operations department.

Requisition for the purchase of the raw material is not supposed to flow in the purchase
department from time to time as per requirements of the factory for if similar were the
procedure in their case too, the production may not only suffer but also halt. In order to
facilitate the procurement of raw material easily, regularly and timely, the company has
agreement with manufacturers\suppliers and the supply is made accordingly.
BUDGETORY LIMITS-

The budgetary considerations have to be in the forefront. If the budgetary limits as

stipulated by the management are likely to transcend, then the permission for such excess
expenditure is sought from the managing director.

RECEIPT OF MATERIALS-

On receipt of consignment from the transport company in the stores department through
the clearing agents, the goods so received with the bill are compared and the material
receipt memo (MRM) is prepared in the light of the purchase order. The MRMs are sent
to purchase department so that they can be forwarded to relevant departments who
initiated the requisition for their approval of the material.

APPROVAL\REJECTION OF MATERIAL

The approving authority may approve or reject the material. If the material is approved,
the purchase department will make the payment. If the material is rejected, the approving
authority would record its reasons for so rejecting the material and the stores department
would prepare a rejection memo and sent to purchase department for taking up the matter
with suppliers.

CASH PURCHASES-

In cases of certain items that are used in small quantity, occasionally and emergently, the
purchase department has been empowered to effect cash purchases. To enable such cash
purchase, the accounts department advance interest money to the tune of Rs.1, 000 to the
purchase department.

IMPORT OF GOODS-

For imported raw material, the import procedure prescribed by the government is
followed. The head office from Mumbai to whom the purchase department writes about
its needs places the purchase orders. Basic formalities like procuring import licenses etc.
for importing the materials are completed by the Clutterbuckganj office.

PAYMENT OF BILLS-

When the purchase is effected, goods received, MRMs prepared, material approved and
admitted in the stores department the stores department would pass the bill as it or after
making necessary deductions and send it to the accounts department for releasing
payment to the supplier. The accounts department after doing the needful sends all the
cheques to the purchase department for onwards transmission on standard Performa to the
concerned party.

SALES-

Sales are important for the well being of an industry. Without affecting optimum sales, a
company cannot survive because all the activities of an organization move around the
potentiality of the market for sales.

CAP has a full-fledged marketing division having branch office in all big cities of India
staffed with highly skilled and professional personnel familiar with special requirements
of all its customers. The regional offices are situated in Delhi, Madras, Mumbai, Calcutta,
Banglore, Madurai, and Vijay Wada. The head office is at Mumbai (central sales,
Mumbai). At each regional office, Regional Marketing manager is the in charge and
works with his marketing field force. Regional offices report weekly, fortnightly and
monthly to central sales, Mumbai. The regional offices send their requirements to central
sales and also to CAP, Bareilly.

Central sales, Mumbai

Delhi region Madras region Mumbai region Calcutta

region

Banglore Madurai Vijay wada

The GM (marketing) looks after all these regional offices from Mumbai (central sales).
There are no distributors whatsoever for the marketing of camphor products. Their own
resources do selling of materials.

All sales orders are received either through branch offices or directly from the purchasers
and are executed at the Bareilly office.
There are two modes of selling in CAP. Either the company dispatches the goods from
the campus to their branch offices and then the branch office markets the products to the
customers or the company directly transports the products to the customers on their
requirements.

Different indents are received daily from different branches. Sales input for is fed into the
computer. On the basis of this, sales resale memo (S.R.M.) cum temp0orary invoice is
prepared for materials to be sent daily.

Stock position of finished products comes daily from warehouse to sales department to
keep the sales department informed of current stocks. Indent wise and product wise
registers are also maintained so that the position of different products is maintained on
daily basis.

Dispatches are made insured, the premium of which along with the freight is paid by the
concerned party. After dispatching the products, the final invoices are prepared and sent
accordingly to the party, accounts department, computer section and the concerning
branch office so that proper follow up can be made for the recovery of money

STORES-

As the name indicates, the main function of stores is storing and issuing of raw materials,
packing material, engineering goods, electrical appliances, research components, safety
components and other requirements to avoid any hindrance in the production process.

Broadly, the stores material in CAP can be classified as-

 Raw material
Packing material
Consumable stores (utility items)
Engineering stores (Indian material)
Engineering stores (imported)

The purchase process is initiated through this department even though they cannot
purchase anything on their own.

The stores place requisition of items to the purchase department in two ways. First, it can
be an independent judge of the requirements in a particular calendar year considering the
past consumption of goods and the production and development of the country. In this
case it can requisition the articles in such a number or quantity as are reasonable and
permissible. The second and more common way is that the requisition should come from
the particular department. Specifying the specific quantity and quality of material it uses.
Even then the stores have to supervise whether the quantity etc. requisitioned is correct or
not. In so doing it has to take the consumption of last year in account. Purchase
requisition register is maintained in stores for entering of requisition.

Materials are issued on FIFO basis that is, first in first out, but may deviate in case of
emergency. Everyday issues and receipts of materials are sent to the computer section
where a statement gets prepared for the submission to purchase department. Weekly stock
position is sent to the purchase department so tat minimum level of inventory which
known to purchase department and determine by the requisition etc. of the plants can be
maintained and orders can be placed if required well in time.
 PERFORMANCE APPRAISAL SYSTEM IN
CAMPHOR AND ALLIED PRODUCTS LIMITED

Camphor and allied products limited is a public limited company

manufacturing over 40 terpene based quality products and expended
polyethylene foam- specialty plastic foam. Its major products are
camphor, menthol, thymol, pine oil, resins, and terpeneols
manufactured at its factory located at clutterbuckganj on the Bareilly-
Delhi National Highway about 6kms from Bareilly city. This project is
based on the study at their plant in Bareilly (U.P). The total strength of
employees is around 480 and they are basically divided into two
groups. They are-

MANAGEMENT-

This includes the managers, officers, supervisors, senior supervisors,

superintendents and assistant superintendents.

WORKERS-

This includes the unskilled, semiskilled, skilled and highly skilled

workers.

The performance appraisal is done in the form of Annual Confidential

Report. The performance is appraised from first 1st January to 31st
December. A personal file of each individual is maintained in which
every important event is recorded. Based on this file, performance is
perused annually or at the time of appraisal.
The whole process of appraisal in CAP begins with the personnel
department and ends with the personnel department. The personnel
department sends the performance appraisal form to the department
head that then sends it to the subordinate officers of their department.
These subordinate officers fill the form, which is then reviewed by the
department head and sent to the personnel department.

Personnel
Department APPRAISAL
FROM

Departmental
Form reviewed by Head
departmental head

Form filled by subordinate

officers of the respective
department
PERFORMANCE APPRAISAL SYSTEM IN CAP

Appraisal form of CAP is highly comprehensive. There is only one form

used in CAP and the same form is used for all the categories of
employees. The performance appraisal form in CAP applies to
promotions, annual increments and disciplinary actions. On the basis of
this form 5% people are promoted and 10% are given additional
benefits.

Trait Ranking Method does performance appraisal in CAP. This method

is less time consuming and the appraiser can get him acquainted with
performance at a glance. Under it, there is a printed form one for each
person to be rated. This form consists of a number of traits like
initiative, job knowledge, ability to learn, personality etc. Also the
employee contribution like quantity and quality of work, attitude
towards work and fellow employees is also considered. In front of each
factor, a number of boxes are given and the appropriate box is ticked
off. Sometimes for promotion purposes, paired comparison technique is
also used.

In the Annual Confidential Report brief bio-data of the employee is

incorporated such as name, position, department, category, pay scale,
basic consolidated salary, date of increment falling due date of expiry
of probationary period/apprentice period/temp. engagement, additional
benefits given during last one year and the attendance record.
Assessment is made mainly on the following points-

1. Quality of work- on the basis of frequency of mistakes and

general accuracy of work produced disregarding amount of
work output given.

2. Quantity of work- on the basis of volume of work, output

disregarding mistakes in their factor.

3. Judgment- on basis of employees ability to think clearly

and make logical decisions.

4. Initiative- on the basis of his resourcefulness in handling

assignment without detailed instructions and ability to think
on original lines.

5. Ability to learn- this is seen by the speed with which

instructions are grasped and new routines mastered.

6. Job knowledge- this assessment here is made on basis of

knowledge for job requirement gained through education
and experience that is to see whether he is familiar with the
job or not.
 7. Attitude- on basis of his attitude towards work and fellow
employees that is whether he is cooperative willingly and
tries to do a through job.

8. Personality- on the basis of the effect of employees

personality upon people contacted that is whether he makes
a favorable impression by his tact or whether he is courteous
and friendly in his daily associations.

9. Safety- on the basis of whether the employee is safety

conscious or not.

10. Supervision ability- this is applicable for supervisors

only. Assessment is made on the basis of the employees
ability to organize a group for maximum efficiency and
whether he has an ability to coordinate activities of the
group with other related groups within the organization.

For the unskilled and semi-skilled workers judgment, initiative,

personality and supervision ability are not applicable.

The Annual Confidential Report is filled by the immediate supervisors

and is then reviewed by the departmental head.

Promotion of executives is done on the basis of seniority as well as on

performance and merit. The Vice President (operations) does the final
appraisal of executives.
OBSERVATIONS-

1) Performance appraisal form in CAP is highly comprehensive. Only

one form is used for all the categories of employees. This is wrong, as
all the traits cannot be treated equally important for all individuals.
Some traits are more important for some individuals than for others.
For examples, aggressiveness is more important for a sales executive
as perseverance is for an executive working in the research
department.

2) All traits are considered additive in nature. This again is wrong, as

the excess of any one trait in an individual cannot make for the
deficiency of others.

3) There is complete absence of counseling or appraisal interview with

the ratee. Very little feedback is given to him and he is left in the dark
as to how he is doing and what he could do in future. This increases his
anxiety, lowers his morale and reduces his commitment to work.

4) There is no system of potential appraisal. Thus the potential of the

worker is not properly brought out.

5) The various factors are not rated with much attention, only a
generalized view is being considered. These factors should be given
different weight age according to their importance.

6) Care is being taken for the appraisal to be impartial.

7) The rating of performance appraisal is kept confidential and is not

communicated to the employees.
8) A positive point in CAP is that they conduct exit interviews. This is
quite useful as the outgoing person gives information without any fear
or pressure.

OBSERVATION
AND
ANALYSIS
INTERPRETATION-

The whole population under study is aware of the existence of performance appraisal
system within the organization.
 NUMBER OF EMPLOYEES APPRAISED IN THE ORGANIZATION

INTERPRETATION-

All the employees within the organization are appraised.

INTERPRETATION-

For all the employees performance appraisal takes place annually.

INTERPRETATION-

Checklist method is used for performance appraisal of all the employees.

INTERPRETATION-

Majority of the employees are aware of the feedback provided by the superior after
performance appraisal.
INTERPRETATION-

Most of the employees belief that after performance appraisal there has been a positive
change in their performance level.
INTERPRETATION-

Majority of the population under study is satisfied with the performance appraisal system
carried out in the organization.
INTERPRETATION-

56% of the employees belief that performance appraisal system can still be improved.
 FINDINGS

Mostly the whole population under study is aware of the performance appraisal system
done in the organization. All the employees are appraised by the head of the human
resource department.

The whole population under study is appraised annually by the head of the human
resource department. That is once in a year the performance appraisal system is practiced
in the organization.

All the employees in the organization are appraised by the checklist method. The head of
the personnel department prepares the checklist form containing questions which is filled
by all the employees.

Majority of the employees under study say that after performance appraisal they are
provided with proper feedback so that they can improve their performance and are also
guided for further betterments.

Most of the employees have found a positive change in their performance after appraisal
and proper feedback. After appraisal if the employees are not found up to the mark then
they are properly guided and trained for improvement.

Most of the employees are fully satisfied with the performance appraisal system done in
the organization but some of them also want some changes as they say that nothing is
perfect and everything can be improved.
Changes which the employees want in the appraisal system are-
The performance appraisal system should take place twice in a year that is half
yearly instead of yearly.
The appraisal system should not be biased.
 The immediate head or supervisor of the employee should do the appraisal and
also provide proper feedback.
LIMITATIONS OF THE STUDY

1) The time during which the study was done was not sufficient.

2) The information provided by the employees was biased.

3) The employees were not fully aware of the performance appraisal system being
practiced in the organization.
 SUGGESTIONS

1) The system can be redesigned in the sense that there should be three different
formats, one each for managers, officers and supervisors, and non-supervisors
personnel instead of the same format for each category.

2) The reliability of a rating system can be obtained by comparing the rating of two
individual for the same person.

3) The rating must be made by the immediate superior. However, a staff department
can assume the responsibility of monitoring the system. Though the staff
department cannot change any rating, it can point out inconsistencies to the rater
such as harshness, leniency, and central tendency and so on.

4) The system should be used as a mechanics to under trained difficulties of

subordinates and providing ways to remove them. The superior should understand
the strength and weaknesses of their subordinates and help them to realize these.
They should help the subordinates to become aware of their positive contribution.
They should also encourage them to accept more responsibilities and challenges
and acquire new capabilities. Finally the superior should plan for effective
utilization of the talents of subordinates.

5) Provision should be made to identify the training needs of the employees.

6) There should be a system of self appraisal of the employee. Along with the
appraisal form appraised by immediate superior, the employee should also
appraise himself and two forms should together go the personnel department. If
there is a wide disparity in any factor, then it should be analyzed and efforts
should be made to know the possible causes of the occurrence.
7) All the traits should not be treated equally for all individuals. Specific standards
should be fixed for specific groups of employees.

8) There should be a system of performance counseling with the ratee. The apraisee
should unreservedly be told how he has been evaluated, strong and weak points
should be fully discussed with him. Proper feedback regarding his performance
should be given to him as he is interested not only in knowing as to where he
stands but also as to what he can do to go up in the hierarchy. Apraisee can also
discuss his grievance with the appraiser which will help in maintaining
harmonious industrial relation.

9) There should be some criteria for potential appraisal which should be measured
in terms of individuals ability to undertake greater responsibilities in the decision
making process leading to greater decentralization.

10) Appraisal should be done with attention. A casual view to the appraisal should not
be adopted as it is very important for the person being appraised.
 CONCLUSION

Management in the modern times primarily means handling of men because it is through
them that the world moves. Of men, machine, money and material, men are the most
important assets possessed by the organization. They rely on the appraisal system as a
tool for deployment of manpower. But many people get upset the moment they learn
about the time for their performance to be appraised.

Performance appraisal is therefore a very vital tool for personal development and because
of the complex factors involved it has to be handled very delicately. It is a process of
assessing systematically the performance of a person on the job and his potential for
higher levels job in future. It provides an objective basis for taking personnel decisions. If
performance appraisal is not done properly then superiors will not able to take proper
personnel decisions. They will not be able to judge the effectiveness of recruitment,
selection, and placement and orientation system of the organization.

If performance system is biased then the superior will not able to judge the real
performance of the employees and will not be able to give the proper feedback and
analyze their training and development needs. Systematic appraisal of employees helps to
develop confidence among them.

The performance appraisal system in a reputed organization like Camphor and Allied
Products Ltd. has been studied with a view to analyze the practical implications of the
system and to give findings regarding the various aspects of the performance appraisal
system and their some of the applications. The various suggestions given have been based
on the survey conducted of different appraisers and appraises in the organization.
 QUESTIONNAIRE

This questionnaire is constructed to study the topic titled A comprehensive study of

performance appraisal system. The information and opinion given by you shall be
kept confidential and will be used for academic purpose only.

NAME

AGE

GENDER

CONTACT NO.

Q1) Are you aware of performance appraisal system in your organization?

a) Yes b) No

Q2) Have you ever been appraised?

a) Yes b) No

Q3) How many times the performance appraisal system takes place in your organization?

a) Annually b) Half yearly c) Quarterly

Q4) What are the methods used by the organization for performance appraisal?

a) checklist method
b) self appraisal method
c) diary method
d) observation method
e) any other method

Q5) Do you get the feedback after the performance appraisal?

a) Yes b) No

Q6) Do you find any positive change in your performance after appraisal?

a) Yes b) No

Q7) Are you satisfied with the methods of performance appraisal used by the
organization?
a) Yes b) No
Q8) Do you feel that there is a need of any change or improvement in the performance
appraisal system?

a) Yes b) No

Q9) what kind of change you want to impart?

Q10) Would you like to give any suggestion?

 BIBLIOGRAPHY

Tripathi, P.C: Personnel Management, Sultan Chand and Sons, New Delhi, 1995.

Monappa, Arun and M.S. Saiyidain: Personnel Management, Tata McGraw Hill, New
Delhi, 2004.

Boler, Malti: Performance Appraisal, Vikas Publishing House, New Delhi, 2005.

Flippo, Edwin B.: Personnel Management, McGraw Hill, Kogakusha, Tokyo, 2005.

Gupta, C.B.: Human Resource Management, Sultan Chand and Sons, New Delhi, 2007.