INDUSTRY PROFILE

Home Appliances are that without which a modern home is considered incomplete,

especially in urban areas. We have become so used to some of the home appliances that it seems

difficult to live without them. Since the mid-1800s, people have been thinking of new and

innovative ways to store food, cook food and clean up after eating food. Many of these ideas were

good enough to be used by a large number of people and they are still around today. Indeed, they

have made our life more comfortable and easier than ever. In metro cities and big towns, such

household appliances are regarded as a boon, as they are instrumental in cutting down the time

involved in most of the domestic chores. This is really a great help since people often find it

difficult to keep a balance between professional obligation and household needs. China has

become one of the world's major producers of home appliances after development over a decade.

The Indian pressure cooker market size is approx. 9 million pieces p.a., which is equally

divided between organized and unorganized sector. Pigeon enjoys 30%+ market share in the

pressure cooker market of which it is the market leader in the outer lid market segment with 65%

market share and 5% of its recently entered into and a highly competitive inner lid market.

The branded cookers market has been growing at 5-6% over the last 4-5 years

While Pigeon has witnessed volumes growth at 8 -10%. We expect this segment to continue to

clock similar volumes growth over the next 2-3 years. Pigeon strategy in this segment has been

to innovate and give the user a better product experience. Pigeon has introduced both aluminium

and stainless steel cookers, the latter of which has given boost to the overall average realization.

Pigeon product innovation, superior quality and product technology has always enabled it to

command a superior price realization over its peers. Pigeon cookers are targeted towards middle

class and the upper middle class and enjoy a 3-5% price premium over other branded

manufacturers. Pricing Rate Structure and Incentives to Consumers. If done right, time of use

electricity pricing will not require people to change their behavior to save money and help the

environment. Communication Standards: Standards and protocols for communications with

Smart appliances must be open and limited in number across all utility districts. While smart

appliances must work seamlessly with electric utilities in a fully functional smart grid system,

the consumer must always have control over the appliance. If a consumer wishes to override

deferral of an appliance function and incur a higher electricity rate, they should be able to make

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such a choice the boundary of the utility's reach should end at the smart meter. The purpose of

the Pigeon is to provide more efficient use of energy, not for utilities to control or monitor

appliance usage. It is commonly believed that a trio of kitchen appliances—the refrigerator, the

mixer-grinder, and the pressure cooker have transformed the lives of millions of housewives in

India. Given the unique culinary habits of Indians, who use a lot of lentils and rice in their foods,

the pressure cooker is perhaps the most important kitchen appliance in an Indian home.

COMPANY PROFILE

Founded in 1995 by a young 25 year old first generation entrepreneur Mr.Rajendra.J.Gandhi ,

the current Chairman & Managing Director, whose passion for manufacturing, keen eye to learn

& innovate and ability to manage the company hands-on, has made Stovekraft - the FASTEST

Growing Kitchen Appliances Company in India.

Stovekraft established in 1997 as an unit of Vardhman group started manufacturing LPG

stoves in Banglore breking the stranglehold of Delhi based companies and become the largest

LPG stoves manufacturing in the country. Being an OEM for brands like TTK ,Maarlex ,

inaslsa and host of other brands was a feather in the cap for Stovekraft. In 1999 stovekraft pvt

ltd as born and started a tie up with BPL to manufacture its ulter premium LPG stove range.

It was time to taper down the OEM business and to have own brands birth of two brands

happened in 2001-Pigion and Gilma . From then on there is no looking back and the company

started adding new products to its protfolio every year.

Success has not in any way changed the values of the organization. Humility, Reliability and

Trustworthiness have always been the driving factors behind the growth of Stovekraft .But

evolving at Stovekraft is not just about being a market leader. The company provides its

employees, an environment that allows them to excel in their areas of competency and interest.

The work culture at Stovekraft is based on the profound belief that employees are its most

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important asset. Respect and genuine concern for each employee in the organization is the basic

principle on which the organization functions.

Stovekraft recognizes the need of the consumer depending on his values and lifestyle. The 250

Crore plus company is the proud owner of the two flagship brands in the market, namely

and . Pigeon being a value for money brand is now an immensely

successful brand with a wide product portfolio. Gilma branded products are targeted at the

premium segment.

The company has carved a niche for itself in the domestic and foreign markets, garnering export

orders from countries like Fiji, Sri Lanka, the Middle East, and Africa. Today, Stovekraft has

gained a strong foothold in all the markets it operates in and has managed to edge out the

existing competition. The company, whose turnover is INR 2500 Millions Plus, continues to

spread its wings and grow every day.

History and Growth

Starting with Manufacturing of Kerosene Wick stoves with a turnover of INR 24 lakhs Company

in 1994, adapting itself to the changing times, has constantly moved up the value chain.

Stovekraft established in 1997 as an unit of Vardhman Group, started Manufacturing LPG

stoves in Bangalore breaking the stranglehold of Delhi based companies and became the largest

LPG stove manufacturers in the Country. Being an OEM for brands like TTK, Marlex, Inalsa

and host of other brands, was a feather in the cap for Stovekraft. In 1999 Stovekraft Pvt ltd was

born and started a tie up with BPL to manufacture its Ultra Premium LPG stove range.

It was time to taper down the OEM business and to have own brands. Birth of two brands

happened in 2001 – Pigeon and Gilma. From then on there is no looking back and the company

started adding new products to its portfolio every year.

Most Valued Relationships

Stovekraft Ties-up with Petro Giant HPCL (HP) in April 2006 for Co-branded ISI

marked Green Label Series Pigeon LPG Stoves

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Stovekraft ties-up with Indian Oil in August 2006 for co-branded ISI marked Green

Label series Gilma LPG Stoves.

Stovekraft ties-up with Bharat Petroleum in August 2007 for co-branded ISI marked

Gilma stoves.

Stovekraft receives order from Tamil Nadu Govt. to supply 75,000 nos. of LPG Stoves

in December 2006.

Tamil Nadu re-imposes trust with an order for 200000 LPG Stoves in 2009.

Stovekraft is selected as the sole vendor by Pondicherry Govt to supply 10,000 nos. of

LPG Stoves in March 2007.

SIDBI SME Growth Fund has invested INR 22 Crores in Optionally Convertible

Debentures.

Ernst and Young are the Statutory Auditors of the Company.

Grant Thornton are the Internal Auditors for the Company.

Standard Chartered and State Bank of India is the Bankers to the Company.

The Company values these relationships very much and is confident that these relationships will

bring great benefits to the Company.

Nature of business:-

Actually the unit situated at Medmarnahalli , Bangalore rural. The nature of business is

manufacturing company. Stovekraft private Ltd. operates as a home appliances company

worldwide, specialized in kitchen appliances.

There are 4 units :

Production:

1. LPG FAB:

From 1 burner to 4 burner LPG Stoves with both Auto ignition and

Non-Auto Ignition systems

High Fuel Efficient Green Label Series LPG Stoves co-branded with

Public Sector Oil Companies

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Imported Gas Hobs in Gilma Range

2. Cooker

Aluminium and Stainless Steel Pressure Cookers

Imported Electric Rice Cookers

3. Non stick

Conventional pressed aluminium cookware to imported Pressure Die

cast aluminium Non stick Cookware.

4. Moulding

VISION:

Establish Stovekraft as a global brand known for its values assertiveness and the acumen to

adopt the ever changing environment.

MISSION:

To deliver innovative, user friendly and better quality product at best value to

The customers, keeping in mind the prosperity of the company and its stockholders.

GOAL:

Distribution Network all over India for Pigeon with over 25000 dealers

95 Company Owned Brand Stores for Gilma across south and western India.

3 International class showrooms for Gilma Kitchens.

Comprehensive service facility.

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Group turnover exceeding 350 Crores.

Product Profile :

Gilma:

1. Electric Chimneys,

2. Hobs,

3. Cook tops

4. Microwaves.

5. Modular Kitchens

6. Solar Water Heaters

7. Electronic safe

Pigeon:

1. Stainless Steel LPG stoves

2. Stainless Steel Wick Stove

3. Aluminium Pressure Cooker & Pressure Pans

4. Stainless Steel Pressure Cooker & Pressure Pans

5. Non – Stick Cookware

6. Mixer Grinder

7. Electronic pressure cooker

8. Microwaves

9. DVD Player

10. Water purifier

11. Water filter

12. Induction cooker

13. Stainless Steel Vacuum Flask

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14. Electric Rice Cooker

15. Electric Iron

16. Coffee Maker and Kettle

17. Pop-up Toaster

18. Sandwich Toaster

19. Citrus Juicer

Infrastructure:

Over 50 acres of land.

Canteen facilities: There is a canteen in premises of the factory, which provides food at

Free of cost .Canteen open on all working days.

Power Sanction of 1000 Hp.

Trained and Committed Production Team.

Quality Tool Making Facilities with highly skilled personnel.

Total built up area of over 250000 Square Feet.

Exclusive admin block – under construction.

Exclusive accommodation for workers.

Transportation Facility : Company owns vehicle

Medical Facilities: The Company has set up a medical center in the premises which has

qualified doctor with supporting staff. Medical facilities are available around the clock. It

has basic facility like ambulance, wheel chairs etc.

Capacity:

Pressure cooker – 2 million p.a

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LPG stoves – 3 million p.a.

Non-stick cookware – 3 million p.a .

Over 1700 employees

Achievement and Awards:

1999- Stovekraft Private Limited is born. A tie-up with BPL to manufacture its ultra-premium

LPG range.

2000- Pigeon Appliances Pvt. Ltd. Is born, develops and adds Mixers Grinder to its product

portfolio.

2004- State-of-the-art manufacturing unit at Baddi to deliver new range of exciting products.

Pressure cooker is added to Pigeon portfolio Gilma adds 4 burner cook top that stuns the market

with its looks and quality. In no time it becomes a star product.

2006- Chimneys, Hobs are launched under the Gilma brand. Becomes a major brand in India in

the lifestyle segment.

TIE-UP WITH PETROLEUM GIANTS HPCL , BPCL and IOCL To manufacture and market

co-branded ISI certified GREEN LABEL LPG Stoves with more than 68% Thermal Efficiency.

2009- STOVEKRAFT is the India’s largest manufacturer of co-branded ISI certified GREEN

LABEL LPG Stoves .To meet the raw material requirements we are setting up a rolling mill to

manufacture 5000 tons of Aluminum circles per Annum which will also be the largest facility in

India

2010- State-of-the-art fully automated Pressure cooker & LPG manufacturing unit at Bangalore

2010- State-of-the-art fully automated Nonstick and Wonder cast die cast manufacturing unit at

Bangalore.

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ORGANISATIONAL STRUCTURE:

MANAGING DIRECTOR

GENERAL MANAGER

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Finance Dept

Production Dept

Marketing Dept

Purchase Dept

HR Dept R&D Dept

Tool room

Service Dept

VP&CEO VP Marketing Senior Manager

GM Purchase

Director VP GM Head

GM A/c GM finance

Manager Production

ManagerVP Head In charge

In chargeAsst

Manager

Deputy Manager

Senior Manager

GM MktSenior

Manager

Supervisor Asst Manager

Executive Executive Designer Technician

Manager A/c

OperatorTrainee TechnicianAsst

ExecutiveAsst Purchase

Branch Manager

Line SupervisorManager

Finance

Accountant

Assistant

Asst Sales

Executive

Promoters

Competitors Information:

PREETHI:

Preethi, the largest selling mixer-grinder brand in India, today launched its new range

that would lead the company’s pan-India market expansion and was planning to enter into the wet

grinder market in the next 12 months. Preethi is a strong competitor in the market for Mixie. In

Mixie they are strong competitor for every one they are maintain a standard value in the minds of

the customer.

PANASONIC:

Under the Panasonic brand and its slogan, "Panasonic ideas for life," Panasonic Corporation

provides a wide range of products, from audiovisual and information/communication equipment to

home appliances and components, as one of the largest electronic companies in the world today.

The company aims to become the No.1 "Green Innovation Company" in the electronics industry.

PRESTIGE:

Over the past five decades TTK Prestige Limited, has emerged as India’s largest kitchen appliances company catering to the needs of home makers in the country.  Every Prestige brand product is built on the pillars of safety, innovation, durability and trust, making the brand Valuable. We always begin by understanding the needs and requirements of our customer and then we design and deliver innovative products.   TTK Prestige Limited has come a long way.  Today, TTK Prestige Limited has the widest product portfolio covering all aspects of the Kitchen making it the only brand to offer TOTAL KITCHEN SOLUTIONS to the customer. The product range includes Pressure Cookers, Non-Stick Cookware, Rice Cookers, OTG’s, Kitchen Hoods (Chimneys), and Hobs, LP Gas.

SUNFLAME:

Renowned for its high-quality, high-performance kitchen/home applications, Sun flame is clearly the No. 1 choice of homes across India. With leading-edge technical superiority, and innovation as the cornerstones of our corporate philosophy, Sun flame assures its customers consistent quality and dependability. Limited is also the first Kitchenware Company in India to receive the ISO 9001 Certification and the PED/CE Certification by TUV, Germany.   Prestige has been

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awarded with Selected “Super Brand” validated by Consumers and also it is the most preferred brand in Kitchenware segment.

BUTTERFLY:

The Butterfly Group, Pioneers in Stainless Steel Appliances started operations four decades ago. The company was the first in India, to introduce Stainless Steel Pressure Cookers and Vacuum Flasks, and acquire the ISO 9002 certification, in the LPG and Mixie divisions. Over the years, under the enterprising leadership of Mr. V Murugesa Chettiar and his sons, Butterfly has grown to be a household name among millions in India. Today, Butterfly manufactures a comprehensive range of home appliances, kitchen products and cookware.

NIRALI;

Nirali appliances" is a prominent name in world class electrical/electronic appliances

product. Our company was started with an aim to establish themselves as market leaders in the

service oriented industry. Our company believes that quality standards of products and services

can be raised through distributor/dealer network, teamwork, training and motivation.

Area of operation:

Area of operation of Stovekraft private limited.

Regional:

Bangalore rural: Stovekraft private limited

.#81 Harohalli Industrial area , Kanakapura Taluk , Ramanagara District , Bangalore Rural.

National: Himachal Pradesh

Baddi

Countries to which exported

1. UAE (Dubai)

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2. Kenya

3. Fiji Islands

4. Uganda

5. Sri Lanka

6. Kuwait

7. Sultanate of Oman

8. Singapore

9. Tanzania

Exploring Markets

1. South Africa

2. Botswana

3. Mexico

Countries of Import

1. Thailand --- Stainless Steel Sheets and Coils

2. Brazil --- Stainless Steel Sheets and Coils

3. Spain --- Stainless Steel Sheets and Coils

4. Indonesia --- PTFE (Non Stick coating chemical)

5. China --- Imported range of small appliances

J. Future growth and prospects:

SKPL is the Only one company to have such a widest range of products under the umbrella of Pigeon and Gilma two brands, in the world of kitchen appliances product which are consumed very frequently and also has a great demand for the product hence their a tremendous scope for growth as company has growing at a very rapidly in terms of turnover year by year.

The company with over 2000 employees with a turnover exceeding 500 crors with a growth of

100% year by year adding new successful products to its portfolio managing successful brands in

a different marketing segments. Looking at the future sales growth prospects company has

enhanced its in-house manufacturing facility to meet out the demands of the marketing.

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SOWT Analysis:

STRENGTHS

1. Maintain A Good Relationship With All Workers.

2. Highly qualified and efficient staff management.

3. Good industrial relation.

4. Low cost skilled labor.

5. ISO certified Company known for quality.

6. Employees working from many years in the same company which is one of the advantages

to the Company in molding the relationships and experiences.

7. Flexible in terms of production quantity and lead time.

8. Power generation.

9. It is located in the place where good infrastructure is available.

WEAKNESS:

1. Lower productivity and cost competitiveness

2. Quality is not consistent.

3. Low level of training.

4. Few Products quality is bad.

5. Lack of Creativity.

6. Lack of communication.

7. Poor Relationship b/w Workers and management.

OPPORTUNITIES:

1. Huge demand for value added goods in all major countries.

2. Relocation from high cost economies.

3. Large and relatively untapped domestic market

4. Had an Opportunity of NO-1 Position.

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THREATS:

1. A Heavy competition between one against other.

2. Deficiency of confidence in workers.

3. More Local Brands may exist in Market.

4. Though there is high mortality of these players they tend to impair the rapid growth

Of quality conscious branded players by putting their legitimate margins under pressure.

As has been the policy, the company continues to invest in innovation, feature and value

addition, customer education and brand promotion to stay above these unorganized players.

5. Declining economy of manufacturing sectors in general.

6. Govt Policies towards manufacturing industries, imposing environment pollution

restriction.

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Work flow model:

Cooker:

Body Operation Lid Operation

Not Ok

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Ingots for Melting to Vendor for Job work

Ingots for Melting to Vendor for Job work

Inspection of Aluminium

Inspection of Aluminium

Send Back to Supplier

Send Back to Supplier

First & Second Draw Operation

First Drawing

Broaching Operation Trimming Operation

Locking Profile Operation Edge Folding Information

Trimming

Outer Polishing Bottom Bending

GRS Slot Cutting

GRS Hole Piercing Side Hole Piercing

Outer Polishing Side Hole Piercing

Logo Stamping Top Logo Stamping, Vent tube & Safety Valve Piercing

Not Ok

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Inside Sunray OperationSunray Operation

Bracket Riveting Bracket Riveting

Body Hand Fitment Dimpling & Safety Valve Hole Bending

Side Supporting Handle Fitment

Packing with Trivet

Master Carton Packing

Labeling

Cleaning

Fitment Test With Lid & Body

Gasket Fitment

Safety Valve & Vent tube Fitment

Lid Handle Fitment

Pressure Test Rework

To Stores & Dispatch

1. Structure It prescribes formal relationship among various position and activities .Arrangement about the reporting relationship, how an Organizational member is to communicate with other members, what roles he has to perform and what rules and procedures exist to guide the various activities performed by a member are all part of Organization arrangement and relationships.

b) Departmental study:

HR Department:

Competence Building

Commitment 

Motivation  

Employee Relations

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M D

Senior Manager

Asst Manager

HR Executive

Asst Executive

In the backdrop of the above, the focus of Human Resource Development initiatives at

Stovekraft emphasizes the following

I] MAN POWER PLANNING

Out sourcing of low tech and medium tech jobs

Fresh induction only in critical / highly specialized areas based on requirements due to

increase in work load and super annotation profile. In the Workmen Cadre, induction

will be restricted to Direct Workmen only

Improving the existing qualification profile by focusing on  induction of professionally

qualified personnel and diploma holders

Hence focus of recruitment would be to recruit people with a combination of knowledge, skill,

experience and attitude in line with the organizational requirement through appropriate

manpower plan both short term (contract appointments) and long term recruitment program.

II] TRAINING AND DEVELOPMENT

Training is one of the most important tools for developing human resource. Hence, identification

of training competency profile in terms of Vision, Mission of the Company would be the

strategic point of the training and development strategy of the Company. The following

objectives have been set in this regard:-

To provide training to all employees at regular intervals in a plan period of 5

years

Training to become an integral component of individual professional evolution

by:

o updating knowledge to avoid obsolescence

o enhancing professional creativity

o enabling employees to shoulder higher responsibility

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Keeping in view the organizational requirement and goals and objectives of training, the

following have been identified as the key focus areas of training:

Technology

Tooling

Quality

Information Technology

III) PERFORMANCE APPRAISAL:

Appraising people for meeting the Company's goal would be the prime focus of performance

management. The new Performance Appraisal System based on work planning and commitment

(mutually agreed tasks) , self-review and performance analysis, performance review and

feedback would ensure that the focus would be on value adding activities rather than on routine

activities which bear no relationship with the Organization’s goals and objectives.

Identification of low performers and resultant corrective action throughout the Company would

be given priority. Similarly, faster career growth opportunity would be provided to high

performers.

IV] REWARD SYSTEM

The focus of the reward system in the Company is to promote team work and cultivate a sense of

achievement and excellence in the Organization. This is in addition to the existing scheme of

reward for an individual who innovatively and creatively makes exemplary contributions in the

key thrust areas of the Company that would lead to its achieving overall excellence. Lastly, the

HRD Plan will also include time-to-time OD Interventions to address specific requirement of the

Company.

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Marketing

Definition:

Philip Kotler defines marketing as 'satisfying needs and wants through an exchange

process'. Within this exchange transaction customers will only exchange what they value (money)

if they feel that their needs are being fully satisfied; clearly the greater the benefit provided the

higher transactional value an organization can charge.

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MD

Director Marketing

VP Head

GM Marketing

Promoters

Assistant Sales

Executive

Functions of marketing department

Connects link between the buyers and producers Help in increasing standard of leaving Generate revenue for firm Source of information to the top management regarding market condition and demands Facilitate development of business Receiving the purchase order Avoiding excess issue.

Transportation service will be getting from the third party through contract basis and regular basis majorly stocks and materials are moved by road to super distributors /distributers through transport with whom company as regular tie-up.

Distribution Channel:

Company

Super distributor

Distributor

Dealer

End customer

Advertisement agency:

1. Cocoon – Creative’s Agency

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2. Group M- Agency for Print and Electronic media releases

Finance:

Accounts of finance department are the main and the heart of every department of the company

or industry. Here in this factory, the accounts section maintains all the transactions related to the

factory dealings. The sales accounts, purchase accounts, etc are maintained and this department

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MD

VP &CEO

GM Accounts GM Finance

Manager Accounts

Senior Manager Senior Manager

Accountant

Assistant

Manager Finance

prepares P&L account, Balance sheet, etc. In SKPL Pvt Ltd. Accounts department is divided into

four sections.

1. Billing section.

2. Receivables.

3. Payables.

4. MIS &Costing.

In accounts section book keeping is followed. In Billing Section following functions are

performed like

1. Refer to planning sheet

2. Verify with price list.

3. Duties and Taxes.

4. Verify the stock.

Accounts Receivables & Payables section deals with all units’ expenses which includes

manufacturing, Job work-transport, Advertisement, Expenses, Import payment, Fixed

asset register. This section performs the functions like

1. Verify with GRN

2. Verify with purchase order

3. Verify the Taxes and Calculations.

4. Job work- verify with Stock statement.

Cash section: The company book is maintained by recording day today transaction such

as payment, salaries, and wages to banks, payment to suppliers and statutory payment,

salaries and wages.

Internal audit: This is main function of the accounts department to do the Auditing of

vouchers, payment, and purchase, debit note, credit note etc.

Finance:

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The primary function of any business is to earn profit. To earn profit the business has to produce

goods or render service .To do this the management should have adequate supply of funds. It is

the responsibilities of the financial department to ensure of needed funds.

Over the year’s financial function in a business has assumed greater significance .These reflects

by the fact that, some business is known headed by Financial managers. The finance Dept is

assigned the responsibilities of managing the cash flow in such a manner that it would ensure

that the organization will have the means to carry out its objectives as satisfactorily as possible

and the same time meet its obligations.

Taxation:

1. Direct Tax

a)Income Tax

2. Indirect tax

a) Sales tax (Monthly return)

b) Central excise (Annual return)

c) Service tax (Half yearly return)

d) Professional tax (Monthly &annually return)

e) Tax deducted at source (Quarterly return)

3 Banking functions are as follows:

a) Funds position

b) Quarterly, Half yearly report, financial flow report

c) CMA data

d) Monthly stock report

e) Annual budget.

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Production:

The task of production department is not only to produce products of specified quality but also to produce within the desired time and in most economical manner.

Production department functions:

It maintains the plant and machinery used for the production, in good condition. It provides information regarding the process and methods of production. It corrects the deviations from the standards, if any It informs to the top level management regarding the plant and machinery, quality of the

products, loss incurred and changes to be made.

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VP Marketing

Supervisor Production

Line Supervisor

Manager Production

MD

Cooker unit:

Cooker unit is the largest production the SKPL here they are dealing with aluminum pressure cooker two types

1. Outer lid Cooker2. Inner lid Cooker

Marketing department informs requirement for the month. (Ten days prior to the month) Planning and purchase department releases the purchase orders /plant for material procurement.

Production unit has four major sections

1. Component department.2. Press section.3. Assembly section.4. Buffing section.

Production is carried out as per quality standards set for the product .Periodic process control checklists are used to ensure quality.

The manufacturing is carried out of following guiding principal as shown below.

Safety

Delivery 100% on time.

Cost

Quality

Production

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Maintenance department carries out periodic maintenance of machines. Periodic audit is carried out to identify unsafe act, unsafe condition and corrective measures of department.

Application of McKinsey 7S Model

The 7-S model is better known as McKinsey’s 7-S model. This is because of two persons who

developed who developed this model. Developed in the early 1980s by Tom peters and Robert

Waterman have been consultants at McKinsey &company at the time. The model starts on the

premise that an organization is not just structure, but consists of seven elements.

The 7-S model is a tool for managerial analysis and action that provides a structure with which to

consider a company as a whole so that the organizations problem may be diagnosed and a

strategy may be developed and implemented. The 7-S is a framework for analyzing organizations

and their effectiveness. It looks at seven key elements that make the organization and their

effectiveness:

Strategy

Structure

System

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Style

Skills

Staff

Shared values

The seven aspects of McKinsey’s framework are inter-twinned as shown in the diagram below:

The 7-S diagram illustrates the multiplicity of interconnectedness of elements that define

organizations ability to change that it is not just a matter if devising a new strategy and

following it through nor it’s a matter if devising a new strategy and following it through nor it’s a

matter of setting up new system and letting them generate improvements.

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To be effective, their organization must have a high degree of fit, internal alignment amongst all

the seven S’s. All S’s are interrelated and a change in one has a ripple effect on all the others. It’s

impossible to make progress on one without making progress on all. Thus, to improve their

organization, you have to pay attention to all of the seven elements at the same time. There is no

starting point or implied hierarchy. Different factors may drive the business in any one

organization.

Those seven elements are distinguished as Hard S’s and soft S’s. The hard elements are feasible

and easy to identify. They can be found in strategy statement, corporate plans and organizational

charts and other documentations.

The four soft S’s however, are difficult to describe since capabilities, values and elements of

corporate culture are continuously developing and changing. They are highly determined by the

people at work in the organization. Therefore it is much difficult to plan or to influence the

people at work in the organization. Therefore it is much difficult to plan or to influence the

characteristics of the soft elements. Although the soft factors are below the surface, they can

have a great of the hard structure, strategies and system of the organization.

Description:

The hard S’s

Strategy: Action a company plans in response to or anticipation of change in its external

environment.

Structure: Base for specialization and co-ordination influenced primarily by strategy and by

organization size and diversity.

System: formal and informal procedures that support the strategy and structure.

(System are more powerful than they are given credit)

The Soft S’s

Style: The culture of the organization, consisting of two components:

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Organization culture: The dominant values and beliefs and norms, which develops over time

and become relatively enduring features of organization life.

Management style: More a matter of what manager do than what they say, how does a

company’s manager spend their time? What they say, how does a company’s manager spend

their time? What are they focusing attention on? Symbolism– the creation and maintenance (or

sometimes deconstruction) of meaning is a fundamental responsibility of managers.

Staff: The people /human resource management- process used to develop managers,

socialization processes, way of shaping basic values of management cadre, way of introducing

young recruit to the company, ways of helping to manage the careers of employees.

Skills: The distinctive competences – what the company does best, ways of expanding or

shifting competences.

Shared values: Guiding concepts, fundamental ideas around which a business is built must be

simple, usually stated at abstract level, have great meaning inside the organization even though

outsiders may not see or understand them. Effective organization achieves a fit between these

elements. This creation is the origin of the other name of the model: diagnostic model for

organization effectiveness.

System:

System Refer to the processes used to manage the organization

Once an origination is setup more and achieves its basic market share it becomes more service

oriented on the way to its growth. It has adapted the system like no child labour , employees are

taken care of by providing them the facilities like medical aids and their complaints are

considered and over come immediately. Their safety is taken care of by supplying them with

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the safety gadget and the necessary training for using the same. In case of any minor problems in

the company they are handled by the HR department.

Systems include:

Management information system.

Performance management system.

Financial system/Capital allocation system.

Compensation system/Reward system.

Total quality system.

A system is defined as a process or set of processes that links and orders activities to enable work

to be done and goals to be achieved. System in simple words is the formal and informal

procedures including compensation system, management information system and Capital

allocation system that govern every day activity.

Some of the system followed in Stovekraft pvt ltd Inventory control system, total quality

management system, Attendance system. Below is the detail study of system followed in SKPL.

Attendance system:

Company’s punctuality will be measured through their rules and practices .Where

attendance will be played a vital role in punctuality concept .At SKPL ,attendance will

be ,maintained either manually or electronic mode, It depend on the company’s standard.

At SKPL, there are adopting Biometric standards, where each and every employee of the

company will be registered under the Biometric standard /machine where everyone have to

punch their finger prints at the time of entering the Factory premises login and end of the day as

logout time. Will be recorded and maintained for every month .It will be very useful to calculate

the master roll activities of the company.

Out pass:

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Staff can go out Side during office hour only after submitting the outgoing pass (duly signed

by the concerned HOD) at the security department.

On Duty:

On duty intimation means where employee will be performing his/her duty out side the

company within the state or the country, where employee should be give his/her intimation

through a standard format which is duly signed by the authorized person and same will be

submitted to the HR department.

Shift Timings:

Shift Timing

General shift 9 AM to 5.30 PM

1st Shift 6 AM to 2 PM

2nd Shift 2 PM to 10 PM

3rd Shift 10 PM to 6 AM

Skills:

A skill is the ability, knowledge, understanding and judgment to accomplishing a task.

Skills may be defined as what the company does best; the distinctive capabilities that reside in

their organization. The organization selects and assigns personnel performing work affecting

product quality based on appropriate education skills and experience. The company has skilled,

unskilled, semiskilled labors. Depending on the nature and importance on-job Training will be

given to them.

The company requires technical skills for production and manufacturing divisions. Also it

requires strong management skills in marketing and H.R. divisions. The marketing executives

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must have good communication skills and better knowledge of the company and its product.

Many marketing executives have the engineering background with MBA.

Staff:

Staffing may be defined as filling and keeping filled the position in the organization

structure. This is done by identifying work force requirements, inventorying the people available

recruiting selecting placing promoting appraising planning the current job holders so that tasks

are accomplished effectively and efficiently.

At entry level fresher and people with one year or less than one year is also considered. Each unit

specifies the number and type of people required and the recruitment is done as per that

specification. The candidates are placed usually according to their location preference to

particular unit or location. The entry level recruitment process involves short listing and selecting

the candidates based on resumes and personal interview.

The company provides employment to 1903 people, from managerial level to stop floor level as

below:

Office staffs 167

Outside factory 329

Senior Management 19

Workers 1388

Total 1903

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Strategy:

Strategy is a plan an organization formulate to gain a substantial advantages over the

competition .Strategy is the art of devising and employing a system of activities that mobilize all

recourses towards a valuable goal .Strategy is the determination of basic long term goals and

objectives of the enterprise, and the adoption of course of action and the allocation of recourses

available for carrying out these goals.

In other words, the routs that the organization has chosen for its future growth, a plan an

organization formulates to gain a competitive advantage.

Company strategy is to give a customer’s quality products at a best price ‘value for money’ this

is achieved by cross subsidizing the products under combination schemes to dealer as well as

customers depending on the seasons.

For example:1) Consumer scheme : If a customer by induction cook top he gets one induction

base cooker and Tawa as a free .

2) Dealer scheme: If a dealer left specified quality in a lot /month he will be eligible

for additional incentive in kind.

Shared value:

A shared value means that the employees are aware about the common guiding

values. Values are things that one would strive for even if they were demonstrably not profitable.

Values acts as an organization’s conscience, providing guidance in times of crisis. Identify the

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corporate values is also the first essential step in defining the organization’s role in the larger

community in which it functions.

SKPL has the commitment and organization values with quality policy, customers satisfaction

and also with the employees.

The top management ensures whether the employees at all levels are focused towords

achieving the objectives of the company.

The top management arranges training programmers if any deviation exists.

The top management provides adequate resources for carrying out the activities as per the

requirement is given.

The top management carries out the activities relating to monitoring ,measuring analysis

and improvement of quality.

Style:

Style of leadership or relationship refers to the manner in which an individual uses his or her

talents, values, knowledge and attitude to lead and relate to others. Style express the person’s

character .Style is the leadership approach; also the way in which the employees in the

organization present themselves to the outside world, to suppliers and customers. In simple

words, a style is the pattern of behavior, which a leader adopts in influencing the behavior of his

followers in the organization aromatic.

Stovekraft Pvt Ltd has the culture to delegate the authority and responsibility to the workers,

where the worker can exposé his/her talent in the organization. According to culture of the

organization, the company gives the rights and powers to the managers in decision making.

The organization structure consists of managing directors, managers, officers and workers etc.

formal method is created is carried on for routine activities such as quality control and process

control etc. The employees are entrusted with responsibility is concerned. The policies and

procedures are clearly laid down and they are made easily available to the employees.

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