SOUTH EASTERN COALFIELD LIMITED

A REPORT ON ORGANIZATION STUDY AT

SOUTH EASTERN COALFIELD LIMITED

ANAND AGRAWAL
(USN:-15MBA14219)

Under the Guidance of

K.V. SRIDHAR
Associate professor
CENTRE FOR MANAGEMENT STUDIES, JAIN UNIVERSITY

Submitted in partial fulfilment of the requirement for the award of the

Degree of
MASTER OF BUSSINESS ADMINISTRATION
TO THE JAIN UNIVERSITY

SCHOOL OF MANAGEMENT STUDIES

JAIN UNIVERSITY

J.P. Nagara , bengaluru , India

2015-2016

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DECLARATION

I do hereby declare that this report is a bonafide record of the organization study done by
me under the supervision of K.V. Sridhar, CENTRE FOR MAGANEMETN STUDUES
and DASRATHI SAHU , Genral manager, SOUTH EASTERN COALFIELD
LIMITED .during the academic year 2015-2016 from 02/01/16-13/01/16, in partial
fulfullment of the requirements for the award of the degree of masters programme in
Business Administration of center for management studies , jain university, bengaluru.

This work hasnot been under taken or submitted elsewhere in connection with any other
academic course.

Place:

Date:

signature

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ACKNOWLEDGEMENT

I wish to take this opportunity to express my sincere expression of gratitude to each and
everyone who helped me in the completion of the work
First of all I thank god almighty for giving me all the grace and assistance throughout my
work
I am very glad to express my gratitude to Dinesh nilakanth, centre head, centre for
management studies business school, Jain university, for giving me this opportunity.
I would like to extend my gratitude to professor K.V. Sridhar, associate professor, centre
for management studies Bangalore, Jain University, for his valuable suggestions, advice
and encouragement throughout the course of this work.
I express my deep gratitude to my dear friends for their co-operation and helping hands,
who were always friends in need.

ANAND AGRAWAL
(15MBA14219)

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INDEX

SL. PARTICULARS PAGE NO.

NO.

1 INTRIODUCTION TO INDUSTRY PROFILE

INTRODUCTION TO STUDY 1-4
INDUSTRY PROFILE 4-8
GLOBAL SCENARIO & INDIAN SCENARIO 8-12
PEST ANALYSIS 13-16
KEY PLAYERS IN THE INDUSTRY 16
PORTERS 5 FORCE ANALYSIS 17-19

2. COMPANY PROFILE
BACKGROUND AND HISTORY 20-23 20-23
VISION , MISION & OBJECTIVES 24
SWOT ANALYSIS 25-27
PRODUCT AND SURVICE 27-28

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3. STUDY OF THE ORGANISATION DESIGN

PRESENT ORGANISATION STRUCTURE 29
CRITICAL REVIEW OF THE STRUCTURE 30
A REVIEW OF CHOICE IN DESIGN 31-33

4. A STUDY OF KEY BUSINESS LEVELFUNCTION

AND PROCESS
FUNCTIONS OF OPERATIONS DEPARTMENT 34-35
PROCEDURE FOR MATERIAL 35-36
MANAGEMENT DEPARTMENT
FUNCTIONS OF QUALITY DEPARTMENT 36-38
MARKETING AND SALES DEPARTMENT 38-39
FUNCTIONS PERFORMED BY THE FINANCE 40-41
DEPARTMENT
HUMAN RESOURCE DEVELOPMENT
DEPARTMENT 42-45

5. FINDINGS,RECOMMENDATIONS & CONCLUSIONS 46-47

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Chapter 1:
Introduction to the study & Industry Profile

1.1 Introduction to the study-

1.1.1 Organization Study An overview:-

Organizational study is a systematic study of how an organization success

with the help of employees and various department in the competitive world.
Whenever people interact in an organization many factors comes into role.
Many controversies will rise in an organization, this organizational study
helps the student to know how the controversies is reduced.
Organizational study is not only about the study of an organization but also to
learn the roles & functions of an individual department in an organization.
This study is based on different aspects and dimensions of different
departments of the company.

1.1.2 Nature & Scope:-

The nature and scope of an organization is about the division of work,
interrelated activities, assigning duties to employees, decision process
etc.up to what extent.

1.1.3 Objectives:-
To gain knowledge about the business organization
To gain knowledge with the different departments in the organization
and their functioning.

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To understand how the key business processes at carried out in the

organizations.
Understand how information is used in organization for decision
making at various levels
To relate theory with practical.

1.1.4 Methodology:-
Both primary & secondary data is collected from the organization.
Primary data is collected through communicating with employees at
various levels.
Secondary data is obtained from company manuals, company website and
other magazines and newspapers.
Direct observation is used to understand the production process.

1.1.5 Limitations:-
There were difficulties in obtaining data from executives and managers
due to their busy work schedule.
An in depth study of company could not be carried out due to shortage of
time.
The reliability of data used for study in largely depends up on the
companys reports and the information given by executives.
The company has the limitation to disclose their financial details, so a
detailed analysis of financial performance of the company is not possible.

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1.1.6 FACTORS INFLUENCING ORGANIZATIONAL STUDY:-

Organizational study is a manifestation of the attitudes of organizational members

towards the organization. These attitudes are based upon such things that are
management policies, supervisory techniques, the fairness of management, labour
reactions to management and literally anything that affects the work environment.
The factors influencing organizational study are:

Organizational context

The management philosophy of an organization will be evident from the goals,

policies and functions of the organization and the manner in which the goals are
put into operation. For instance, the reputation of a particular company regarding
the treatment of employees would provide some indication of the managerial
philosophy regarding the utilization of human resources.

Organization Structure

An organization structure is the framework of authority- responsibility

relationships in an organization. It clarifies who is to supervise whom and who is
responsible to whom. It serves as the basis of inter- personal relationships between
the superiors and the subordinates and the peers.

Relationship between superior and subordinates

Every employee has to interact with his superior or boss for necessary instructions
and guidance. It is the immediate superior who allows the subordinate to
participate in decision making, gives assignments, does performance appraisals,
conducts performance reviews, interprets policies, determines pay increments and

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decides who has the potential to be promoted. These functions are inherent in
managing and every manner is concerned with these functions. The relationship
between superior and subordinate is not only of an interpersonal nature, but it also
represents the primary interface between the organization and employee.

Physical environment

It has been observed that office dcor, office size and the physical space allotted to
a person at work have an important influence to the development of a favourable
attitude towards the job. Noise has also been considered instrumental in
influencing the climate of organization.

Values and Norms

Over a period of time every organization develops a culture of its own. Culture is
the social or normality glue that holds an organization together.it expenses the
values or social ideals and beliefs that organization members come to share.

Communicating with the Employee

Both formal as well as informal communication channels are used to communicate

with the employees. In addition to downward communication to communicate
rules, procedures and programs of the organization to employees, employees
should also be encouraged to communicate to their superiors.

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1.2 Industry Profile-

1.2.1 Birth of Coal India Limited

The nationalization of the Coal Industry in India took place in two phases. The
Coking Coal Mines were nationalized in May 1972, and the Non-coking Coal
Mines in May 1973. With this, all the mines in the country, except captive mines
of two private companies, were placed under Public Sector. 1st November, 1975

represented a turning point for the nationalized coal industry, when a

comprehensive re-organization scheme was launched. Coal India Limited was born
as a holding company with Rs.750 Crores as its Authorized Capital, and Five
Subsidiary Companies including Central Mine Planning & Design Institute under
it.
The process of amalgamation of mines into bigger units started. The 925 taken-
over Mines, together with 44 NCDC Mines were re-organized into 374 Mines.
Coal India has eight Subsidiary Companies including CMPDI, and is one of the
largest Corporate Employer in the world, employing about 3.58 Lakh people.
Presently, about 91.65% of CIL's production comes from Opencast Mines.

1.2.2 Global scenario & Indian Scenario:

Globally, coal resources have been estimated at over 861 billion tonne. While India
accounts for 286 billion tonne of coal resources (as on 31 March 2011), other
countries with major chunk of resources are USA, China, Australia, Indonesia,

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South Africa and Mozambique. Coal meets around 30.3% of the global primary
energy needs and generates 42% of the worlds electricity. In 2011, coal was one
of the fastest growing forms of energy after renewable sources and its share in the
global primary energy consumption increased to 30.3%-highest since 1969. Coal
production in the Asia Pacific region has grown tremendously and accounts for
over 67% of the total production globally (2011) as compared to about 27% in
1981 (in terms of energy equivalent).

Global Coal Industry market is mainly segmented by Application and by

Geography. Based on Application, market is segmented into Industrial,
Residential, and Commercial, Power Generation and Transportation. Coal Industry
market, by geography is segmented into North America, Europe, Asia Pacific and
Rest of the World. Asia pacific is the largest market for Coal with major coal
exporting countries like China and India. Asia Pacific has the larger demand and
emerging as a larger supplier of Coal.

India is the worlds fifth largest energy consumer, accounting for 4.1% of the
global energy consumption. Maharashtra is the leading state in electricity
generation. The current per capita consumption of energy in India is 0.5 toe against
the global average of 1.9 toe, indicating a high potential for growth in this sector.
Of the total electricity consumed in the country, approximately 80% is produced
from coal.

Typically, Indian coal is characterised by the following quality aspects:

Lower to medium grade coal

High ash

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Low moisture
Low sulphur

While the sulphur content does not pose a serious threat in terms of coal quality
(as India has low sulphur content in general) which has a significant effect on the
environment, the focus always lies on having a balancing process whereby ash
and grade are as per the desired input to the various consumers, while providing a
maximum yield.

The major issues being faced by the coal industry today, leading to further quality
deterioration as follows:
Increased production from lower seams
Lower liberation size
Low washability index
Enhanced production from OCM consisting of larger dirt particles and
foreign
materials
Depletion of good quality coal seams (coking as well as thermal coal)

Owing to a very wide spectrum of coal usage, ranging from power generation to
steel
production to infrastructure and commercial usage, we need to improve the quality
of coal by washing, etc to reduce the environmental impact, enhance coal quality
and
increase process efficiency. The CFRI has developed the following:
Improved froth floatation process
Oleo flotation process

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Oil agglomeration process

Coal washing and coal beneficiation processes are to be given major thrust in terms
of developing strong research cells for developing better practices, suiting
requirements of all the coalfields of India. Various quality measurements should be
put into place complying with India ISO standards, or any other globally accepted
standards, even at the waheries/beneficiation plants operating at smaller capacities.
Apart from such processes, focus must also be given to our mining practices and
stringent norms and practices should be put in place for better mining practice, so
as to avoid contamination at the beginning level itself.

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1.3 PEST ANALYSIS

PEST refers to all political, economic, social and technological factors

affecting any industry. The objective of PEST analysis is to objectively study
the environmental factors facing a firm, company or an industry.
Theexternal environment affects the company in many different manners and
unlike internal environment it cannot be influenced much.

Political Factor:

1. Difficulty in obtaining clearance and leases from the State

Government. There are various clearance which need to be
obtained from different ministers stated below which is a
cumbersome and time consuming process:
Department of mines
Indian Bureau of mines
Ministry of environment and forests
Central Board of Excise and Customs
Department of heavy industry
Ministry of labour

2. There are many private sector players today have captive coalfields for their
own use. But Coal India and its pyramid subsidiaries virtually control the
bulk of this business, if not for anything else, for the simple reason that

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nobody else is equipped to cater to the huge Indian demand. For many years,
if not decades, Coal India is not expected to have any serious competition.
3. Indias coal industry is choking under a heap problem of corruption. There is
low production due to increase in corruption in allocation of coal of coal
blocks, leading to the misuse of these resources by few people.
4. Government of India is giving more emphasis on alternative means of
energy which is long lasting and more sustainable.

Economic Factor:
Although production has been increased the demand for more coal has not
been increased the reason behind it has been loss making electric distribution
companies who are unable to clear their dues.
The coal companies are also not finding it viable to produce more coal
unless they get paid for their dues.
The improvement regarding the production is to be done, it needs to be done
through investment but with lack of financial resources it is not possible for
coal mining companies.
Till now, Indias domestic production by CIL has lacked with respect to
demand, leading to import of coal from outside.
Further the State utilities which buy electricity are not in good financial
conditions, leading to problems of payment to thermal power producers like
NTPC.

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Social factors:
Coal plants in India are very polluting and cause extensive damage to nearby
environment. Further long term workers develop various health problems.
The present status is not sustainable. As India will need more power for the
future.
Mining and utilization of coal beds leads to serious problems of
environmental pollution such as:
1. Land degradation
2. Noise pollution
3. Pollution of local streams, rivers, ponds.
There is low production due to delay in environmental clearance,
environment problems has led to low coal production in India.
India largely performs surface mining leading to higher impact on the
environment could also lead to disasters.

Technological factors:
The use of low calorific coal along with the presence of outdated technology
leads to inefficiency in power generation.
The new technology like coal gasification, use of electrostatic precipitators,
bag collectors etc., in future will improve the efficiency and reduce the
pollution of power plants.
A sustainable development can be achieved by using a scientifically proven
coal mining technology.
Many technological improvements have helped the mining industry in cost
controls, emission controls, and mineral conservation.

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There are many concerned effort for introduction of new technology and
technology up gradation not only in the sphere of exploration and
exploitation but also in other spheres like safety and conservation,
beneficiation etc., continuous miner technology has already been introduced.

The major area for technological up gradations are:

1. Underground mining
2. Opencast mining
3. Coal handling plant
4. Mining electronics

1.4 THE KEY PLAYERS IN THE INDUSTRY:

1. COAL INDIA
2. ARCH COAL
3. RWE POWER

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1.5 PORTERS FIVE FORCES ANALYSIS:

1.5.1 RIVALRY AMONG EXISTING PLAYERS (Low) -

Government limits competition
Large industry size
Fast industry growth rate
Relatively few competitor

1.5.2 THREAT OF NEW ENTRANTS (Low)

High capital requirement

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Advanced technologies are required

Industry requires economy of scale
Geographic factor limit competition
Entry barrier are high

1.5.3 THREAT OF SUBSTITUTE PRODUCTS (Low)

High cost of switching to substitute
Limited number of substitute

1.5.4 BARGAINING POWER OF BUYER (Moderate)

Product is important to customers
Large number of customers
Limited buyers choice

1.5.5 BARGAINING POWER OF SUPPLIERS (High)

Critical production inputs are similar

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High Medium Low

1.Rivalry among establish
player.

2.Threat of new entry.

3.Bargaining power of
supplier.

4.Bargaining power of buyer.

5.Threat of substitute.

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Chapter 2:
Company Profile

About the company-

South Eastern Coalfields Limited is the largest coal producing company in the
country. The coal reserves of South Eastern Coalfields Limited are spread over two
States, namely, Chhattisgarh and Madhya Pradesh and the Company is operating
89 mines with 35 Mines in the State of Madhya Pradesh and 54 Mines in the State
of Chhattisgarh besides a Coal Carbonization Plant namely Dankuni Coal Complex
(DCC) at Dankuni in West Bengal on lease basis from Coal IndiaLimited.

For effective administrative control and operation,the mines have been grouped in
three Coalfields, namely, Central India Coalfields (CIC), Korba Coalfields and
Mand-Raigarh Coalfields with 13 operating Areas.

Awards And Accolades

2013
SECL gets the Corporate Performance Award for higest Production of Coal
in India
SECL gets the Corporate Award for best CSR activities among all Coal
Companies
2010
Business Leadership award to CMD SECL by Institute of Economic
Studies, New Delhi

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2009
Rajbhasha ShreeAward to CMD SECl by Bharatiya Rajbhasha Vikas
Sansthan,Dehradun.
Rajiv Gandhi Sabhavana Award to Shre R.S.Singh D(P) SECL by Rajiv
Gandhi Form, Orissa.
Greentech Environment Excellance Award to SECL by Greentech
Foundation, New Delhi.
International Status Award to CMD SECL by Economic Growth Society
of India, New Delhi.
Ugadi Award to SECL by Delhi Telugu Academy, New Delhi.
Rashtriya Vikas Ratna Award to CMD SECL by Economic Growth Society
of India, New Delhi.
Pride of India Award to SECL and Gold Medal to CMD SECL by
Institue of Economic Studies, New Delhi.
Genentech Safety Silver Award to SECL by Greentech Foundation, New
Delhi.
Best Enterprises Award First Pruxe to SECL By Forum of Women in
Public Sector (WIPS).

Certification-

SECL has been accredited with SA8000 CERTIFICATION on 06.08.2013

SECL has been accredited with ISO 14001:2004 CERTIFICATION on
26.04.2012
SECL has been accredited with ISO 9001:2008 CERTIFICATION
SECL has been accredited with ISO 9001:2000 CERTIFICATION

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HISTORY OF COAL INDIA LIMITED (Holding Company)

2009-10 Award of the Scope Excellence Award to the Company by the Standing
Conference of Public Enterprises for the year 2007-08.Establishment of
Coal India Africana Limitada, a foreign subsidiary in
Mozambique;Conversion of the Company into a public limited
company.
Award of 'Mini Ratna' status by the Department of Public Enterprises,
GoI to CMPDIL.Receipt by the Company of a composite score of 1.47
and rating as "excellent" for the year 2007-2008 by Department of
Public Enterprises, Ministry of Heavy Industries & Public Enterprises,
GoI.

2008-09 Award of 'Navratna' status to Coal India Limited by the Department of

Public Enterprises, GoI, for the operational efficiency and financial
strength, which affords greater operational freedom and autonomy in
decisionmaking.

Overall production of coal by our Company and our Subsidiaries,

crossed 400 million tonnes.

2007-08 Award of 'Mini Ratna' status by the Department of Public Enterprises,

GoI, to WCL and CCL.

1987-88 'Blasting Gallery Method' introduced at East Katras mine under BCCL
and Chora mine under ECL.

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1985-86 Formation of NCL and SECL as Subsidiaries of the Company, to

manage certain mines managed by WCL and CCL.

1981-82 Introduction of retention prices of coal by amending the Colliery

Control Order, 1945 by notification dated March 31, 1982, in respect of
the Subsidiaries.

1980-81 Construction of five new washeries: Moonidih washery, Ramgarh

washery, Mohuda washery, Barora washery, Kedla washery.Overall
production of coal by the Company and the Subsidiaries crossed 100
million tonnes.

1979-80 Construction of the low temperature carbonized plant started in Dankuni

Coal Complex.The pricing policy of CMPDIL was reviewed to ensure
that the company was working on a commercial line instead of working
on "no profit no loss" basis.

1975-76 Change of name of the Company to 'Coal India Limited'.Incorporation

of CMPDIL, ECL and WCL, and formation of BCCL, CCL, CMPDIL,
ECL and WCL, as our Subsidiaries.

1973-74 Nationalization of coal mines, in order to provide for a higher growth in

coal sector to meet the growing energy needs of the
country.Incorporation of the Company as 'Coal Mines Authority
Limited'.

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MISSION OF SECL:

To produce planned quantity of Coal efficiently and economically in an eco-

friendly manner with due regards to safety, conservation and quality.

VISION OF SECL:
To be the lading energy supplier in the country through the best practices from
mine to market.

OBJECTIVES :
SECL as a corporate citizen realizes its responsibility not only for meeting the
increasing demand of coal for generation of electricity but also for the protection
and improvement in environment and around its mining areas leading to
sustainable development.
The Enviroment protection and improvement aspects are integrated at mine
planning and design stage and practiced throughout operational life of the mines
till successful closure.

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SWOT ANALYSIS:
STRENGH-
1.The government offers a wide range of concession to the investors in India,
engaged in mining activity. The main concession includes in the following area:

Mining in specified backward districts.

Environment protection equipment is eligible for 100 per cent
depreciation.
From export profits

2.Labours are easily available

3. Low labour and conversion cost

4. Strong Coal reserves.

5. Strong financial and operational performance.

6. Has been awarded with Navratna Status.

7. Strategic agreements with NTPC.

WEAKNESS-
1. Coal mining in India is associated with poor employee productivity.
2. Historically, opencast mining has been favoured over underground mining.
This has led to land degradation, environment pollution and reduce
quality of coal as it tends to get mixed with other matters.

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3. Poor infrastructure facilities.

4. Mining technology is outdated.
5. Low innovation capabilities.
6. High rate of accidents.
7. Labour force is highly un-skilled and inexperienced
8. Mining operations are not environment friendly. Least importance is given
to the to environment concern issues.
9. High rate of illegal mining

OPPORTUNITIES-
1. There exists considerable opportunities for future discoveries with the
application of modern techniques.
2. Strenghning of logistics in coal distribution.
3. Indias numerous technology research institutes are working on energy
related R&D.
4. Upcoming power projects.
5. Emerging technologies.
6. Increasing demand for electricity in India.
7. Launch of E- procurement.

THREATS-

1. Foreign Investment in the Mining sector.

2. A heavy tax burden discourages further investments.
3. Politicians undervalue the industrys contributions to the economy.
4. Stricter environment rules restricting mining activities.

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5. Failure to satisfy contractual obligation.

6. Unpredictable future for Coal demand.
7. Operational risk.

PRODUCT AND SERVICES

COKING COAL :

These coals, when heated in the absence of air, form coherent beads, free from
volatiles, with strong and porous mass, called coke.

These have coking properties

Mainly used in steel making and metallurgical industries
Also used for hard coke manufacturing

SEMI COKING COAL :

These coals, when heated in the absence of air, form coherent beads not strong
enough to be directly fed into the blast furnace. Such coals are blended with coking
coal in adequate proportion to make coke.

These have comparatively less coking properties than coking coal

Mainly used as blend-able coal in steel making, merchant coke
manufacturing and other metallurgical industries

NON-COKING COAL :

These are coals without coking properties.

Mainly used as thermal grade coal for power generation

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Also used for cement, fertilizer, glass, ceramic, paper, chemical and brick
manufacturing, and for other heating purposes

LTC COKE :

LTC Coke(CIL Coke) is a smokeless, environment friendly product of the

Dankuni Coal Complex, obtained through low temperature carbonisation.

Used in furnaces and kilns of industrial units

Also used as domestic fuel by halwais, hotels, etc.

COAL FINES / COKE FINES :

These are the screened fractions of feed raw coal and LTC coke (CIL coke)
respectively, obtained from the Dankuni Coal Complex and other coke oven plants.

Used in industrial furnaces as well as for domestic purposes

TAR / HEAVY OIL / LIGHT OIL / SOFT PITCH :

These are products from Dankuni Coal Complex using low temperature
carbonisation of non-coking coal in vertical retorts.

Used in furnaces and boilers of industrial plants as well as power houses, oil,
dye, pharmaceutical industries, etc.

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Chapter 3
Organization Design

Board of Directors

CMD

Director T Director Director

Director T (operation)
(project & planning) (Finance) (personnel)

Excavation
Finance Personnel
Corporate Planning
& Projects
Production
Accounts Industrial
Relation
New Technology
Contract
management Internal Audits HRD
Electrical &
Mechenical
M.I.S.
Systems Welfare

Industrial Material
Engineering Management &
Stores Civil Enginnearing

Sales & Marketing

Safety & Conservation
& Resource
Medical

Quality Control
Electronic & Security
Telecommunication

Central Workshop
RAj Bhasha
Land & Resource

Legal
Environment

General Service
Civil Enginnering

Pension & Social

Security Service

Public Relation

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3.1 CRITICAL REVIEW OF SECL STRUCTURE

To cater to a large organization spread geographically as well as functionally is

well laid with combination of line and staff function. The organization is headed
by Chairman-cum-Managing Director (CMD) duly supported by four Functional
Directors like Operation, Project, Finance and Personnel.

The organizational structure is interwoven due to division of command Areas

geographically each headed by Area General Managers (AGM).

The parallels of AGM are placed at Corporate Office level to head each functions
like Material Management, Production, Safety, Land & Revenue, System,
Management Information System (MIS), S&M, Personnel, Medical, Excavation,
Electrical & Mechanical, and Civil etc.

The functions of these heads at corporate level is to finalize the supports to Areas
through policy making, standardization and technical evaluations of demand raised
by Areas.

Similarly, AGM is subordinated through staff functions in all the above cadres and
line subordination through Sub-Area Manager and Production Unit Manager.

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3.2 Types of organizational structure:

In the above organizational chart we can find different types of structures.

Some of them are:

i) Line organizational structure

ii) Staff organizational structure
iii) Line & staff organizational structure
iv) Divisional organizational structure

i. Line organizational structure:

Has only direct, vertical relationship between different levels in the firm.

Advantages:
We can easily simplify & clarify
Promotes fast decision making
Simple to understand

Disadvantages:

Overloads key persons

Ineffective because of larger line organization

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ii. Staff organizational structure:

An organization where staff department have authority over line personnel
in narrow areas of specialization.

Disadvantages:
Potential conflicts resulting from violation of principle of unity of
command
The tendency to keep authority centralized at higher levels in the
organization.

iii. Line& staff organizational structure:

Most large organizations belong to this type of organizational structure.

These organizations have direct, vertical relationships between different
levels and also specialists responsible for advising and assisting line
managers. Such organizations have both line and staff departments. Staff
departments provide line people with advice and assistance in specialized
areas.
Advantages:
Even through a line and staff structure allows higher flexibility and
specialization it may create conflict between line and staff
personnel.
Line managers may not like staff personnel telling them what to do
and how to do it even though they recognize the specialists
knowledge and expertise.
Some staff people have difficulty adjusting to the role, especially
when line managers are reluctant to accept advice.

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Staff people may resent their lack of authority and this may cause
line and staff conflict.

Disadvantages:
Conflict between line and staff may still arise.
Staff officers may resent their lack of authority.
Co-ordination between line and staff may become difficult.

iv. Divisional organizational structure:

In this type of structure, the organization can have different basis on which
departments are formed

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Chapter 4
Business Level Functions

4.1 FUNCTIONS OF OPERATIONS DEPARTMENT:

The operation function of SECL is to bring together the raw materials with
the production process to make products that is suitable for consumer use

By introduction of Universal Drilling Machines (UDM) this resulted in

significant improvement in blasting efficiency leading to increased
availability of coal and also improvement in Green Zone support with added
safety.

SECL enjoys wide range of benefits, such as increased efficiency by using

Man Riding System and Universal Drilling Machines and more efficiency and
more effective management of health and safety and environment issues by
taking Energy Efficiency Initiatives.

Material Management: All the procurement cases of material were finalized

through e-tendering with e-price bid in the company. Safety is always the top
priority and the company continuously thrives to achieve the superior
standards through adoption of best practices. Thrust is given to boost safety
awareness at the grass root level so as to prevent repetitive nature of
accidents.
Participative Safety Management is also practiced at the unit level through
monthly Safety Committee meetings and Tri-partite Safety Committee

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meetings at Area Level with active participation of DGMS officials as well.

Special safety awareness drives on various subjects like green roof support,

safe practices in haulage, belt conveyors, face equipment, ventilation, dust

suppression, explosives and blasting were also organized by Internal Safety
Organization (ISO), to improve the safety standards, practices and safety
awareness etc.

4.2 FUNCTION OF MATERIAL MANAGEMENT

DEPARTMENT:

Material Management department procedure is to procure Raw material. Following

is the procedure to procure raw material:
1) Material budget is to be prepared on the basis of consumption level and
area makes an estimate of budget and is forwarded through AreaGeneral
Manager to General Manager of material management.
2) General Manager of material management department get it approved
through Quality Competent Authority for WCL to purchase.
3) After approval it goes to finance department for budget provision for
revenue, capital and plant and machinery.
4) After getting budget provision Material Management department prepares
the terms and conditions for procurement with consultation of user
department.
5) Material management department floats the tender on the website on some
fixed date i.e., last date of tender submission and date for opening of the
tender.

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6) On the date of opening, it is being opened by dealing officer (Material

Management) department in presence of one finance executive.

7) Tender is submitted in two parts:

Commercial and Technical bid

Price bid

If the price is not justified Material management department will call the tenderer
to justify their rate and after justification if Material management thinks it is
reasonable price the order will be placed otherwise the department goes for re
tender.Before placing the order the approval of competent authority has to be
taken. Within the due date the tenderer has to supply the material to consignee as
per the order.

4.3 FUNCTIONS OF QUALITY DEPARTMENT:

1. Segregate the contamination from coal steams and extraction is done of

coal only.
2. Selective mining is done
3. Coal sampling is done and given grades. There are phase of coal
sampling:
Coal phase
Coal stock yard
At CHP(coal handling plant)

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At the Railway siding (it is a dispatch poi t before dispatching coal

is being crushed into small sizes)
4. Coal is being delivered to supplier and then it is governed under NCDP
policy.

GCV CHART:

GRADE GROSS CALORIFIC VALUE KCAL/KG)

G1 EXCEEDING 7000

G2 EXCEEDING 6700 AND NOT EXCEEDING 7000

G3 EXCEEDING 6400 AND NOT EXCEEDING 6700

G4 EXCEEDING 6100 AND NOT EXCEEDING 6400

G5 EXCEEDING 5800 AND NOT EXCEEDING 6100

G6 EXCEEDING 5500 AND NOT EXCEEDING 5800

G7 EXCEEDING 5200 AND NOT EXCEEDING 5500

G8 EXCEEDING 4900 AND NOT EXCEEDING 5200

G9 EXCEEDING 4600 AND NOT EXCEEDING 4900

G10 EXCEEDING 4300AND NOT EXCEEDING 4600

G11 EXCEEDING 4000 AND NOT EXCEEDING 4300

G12 EXCEEDING 3700 AND NOT EXCEEDING 4000

G13 EXCEEDING 3400 AND NOT EXCEEDING 3700

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G14 EXCEEDING 3100 AND NOT EXCEEDING 3400

G15 EXCEEDING 2800 AND NOT EXCEEDING 3100

G16 EXCEEDING 2500 AND NOT EXCEEDING 2800

G17 EXCEEDING 2200 AND NOT EXCEEDING 2500

4.4 MARKETING AND SALES DEPARTMENT:

The prevailing negative coal balance position arising out of demand commitments
being far in excess of the coal availability from the sources thus there is not much
need of marketing the Coal.

Raw coal off take was affected mainly due to the reasons beyond the control of
SECL. The main reasons of shortfall are as under:

MODES OF DESPACH OF COAL

1. Railway
2. Road
3. Other modes.

MODES OF SELLING COAL

1. Road Sales
2. Railway
3. Auctions
4. Commercial(payment billing agreement)
5. LOA (Letter of Assurance)

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CLASSIFICATION OF CONSUMERS:

1) Core and non-core consumers-

The existing classification of consumers into core & non-core has been
reviewed and it has now been decided to dispense with the same. Instead
each sector/consumers would be treated on merit keeping in view, the
regulatory provisions applicable thereto and other relevant factors.

2) Other consumers-
75% of the quantity as per the normative requirement of the
consumers/actual users would be considered for supply of coal through fuel
supply agreement by CIL at notified prices to be fixed and declared by CIL.
The balance 25% of coal requirement of the units will be sourced by them
through e-auction / import of coal etc.

3) Consumer in small and medium sector-

The state government is requested to work out for genuine requirement of
such units in small and medium sector like smokeless fuel, bricks kiln, coke
oven units etc. on transparent and scientific basis and distribute coal to them
accordingly. The present cap is also enhanced to 4200 tones per annum for
the targeted consumers under this category.

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4.5 FUNCTIONS PERFORMED BY THE FINANCE

DEPARTMENT:

1) TENDER:
Commercial and Technical bid
Price bid

Commercial and Technical bid

In technical and commercial bid, the bids are opened and sent to technical
department for examination of technical terms.

After the examination of technical and commercial terms and conditions is

being done, it is sent to the associate finance department from material
management department.

Price bid
After vetting approval from both the department price bid is opened for only
those tenderer who qualify in technical terms and conditions.
A comparative statement of price bid is prepared by dealing officer of Material
management department to decide lowest tenderer.
The lowest bid is then compared with justified rate and last purchase price and
if it is found to be reasonable order can be placed on the lowest bid.
If the price is not justified Material management department will call the
tenderer to justify their rate and after justification if Material management
thinks it is reasonable price the order will be placed otherwise the department
goes for re tender.

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Before placing the order the approval of competent authority has to be taken.
Within the due date the tenderer has to supply the material to consignee as per
the order.

2) Finance department performs the function of Auditing:

Ensures compliance of internal control system.

Reviewing the financial statements with the management before
submission to the Board for approval.
Reviewing the adequacy of internal audit function.
Discussion with the internal auditors any significant findings and follow
up thereon.
Discussion with statutory auditor.

3) Finance department performs the function of Sales accounting

4) Finance department prepares cost sheet

5) Finance department does Cash disbursement

6) Finance department prepares final accounts statement.

7) Finance department does treasury operation which means the department

invest the idle funds into a beneficial area of operation.

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4.6 HUMAN RESOURCE DEVELOPMENT DEPARTMENT:

Human Resource Development has three department i.e.

Industrial Relations Department,

Human Relations Department
Executive Establishment Department.

IR DEPARTMENTS FUNCTIONS ARE LISTED BELOW:

Fixation of wages:

The wage structure and other conditions of services including fringe benefits of the
employees in the coal industry are covered under the recommendation of the
central Wage Board for coal mining Industry as accepted by Government of India.

The wages were applicable as per wage agreement which shall be called as
NATIONAL COAL WAGE AGREEMENT VIII and which was effective from
1.7.2006.

This agreement shall cover all categories of employees in the coal industry
who were covered under NATIONAL COAL WAGE AGREEMENT I-VII
and also employees of those establishments, which are functioning and may
be functioning under the coal companies.

The scope of the agreement covers the wage structure including Dearness
Allowance, fitment in the revised pay, fringe benefits, service conditions, welfare,
leave and national holidays, house rent allowance, social security pension safety
&other matter as contained in the different chapters of this agreement.
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THE INDUSTRIAL RELATION FUNCTIONS ON THE BASIS OF:

Industrial department mainly deals with Non Executive employees.

IR department follows NCWA Policy which provides employment to the
legal heir or their dependent in case of death of an employees or deceased
employee.
IR Department deals with Staff establishment cell:

Which operates in promotion, absenteeism, problems related to staff.

IR department provides Employment against Land Acquisition benefits to

the owner from whom the land is being procured in accordance with PAPS
(Project Affected Person) and R&R Policy or give monitor compensation.
IR Department helps in Recruitment and Selection of Non-Executive for any
post through advertisement, the recruitment and selection process can be
through open or departmental.
Transfer of non-executive employees is also carried down by Recruitment
and Selection cell.
The Ministers letter or reference letter of ministers first come to IR
department and then it goes several concerned departments through VIP cell.
The grievance redressal can be done through union IR meetings which can
be resolved in area then if not solved it comes to headquarters department.
The meetings are arranged to resolve the conflicts related to SECL affecting in any
manner to SC/ST tribes. IR department helps to resolve their conflicts.

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IR Department functions in case of Misconduct of job

In case of misconduct one should abide the terms and conditions. The following
shall denote misconduct:

Theft, fraud or dishonesty in connection with the employers business.

Willful neglect of work.
Slowing down work.
Going to illegal strikes without giving prior notice of 14 days.
Refusal to accept any charge sheet or notice or order communicated in
writing.
Inciting other employees to resort to violence.
Sleeping on duty.
Holding meetings of mines without any prior notices to management.
Interference with safety devices and firefighting equipment.
Leaving work without permission or sufficient reason.
Acceptance of gift from subordinate employees.

Penalties for misconduct:

Warning
Fines
Suspension without wages not exceeding 10 days.
Stoppage of increment without cumulative effect.
Stoppage of increment with cumulative effect.
Demotion to a lower grade.
Removal or discharge from services.
Dismissal from services.

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HUMAN RESOURCE DEPARTMENT FUNCTION-

IN- COMPANY TRAINING:

In-Company training plays a vital role in improving knowledge, skill and attitude
leading to overall development of Human Resources.

OUT-COMPANY TRAINING:

Human Resource Development Department acts as nodal department to arrange

and provide Out-Company training to the employees to expose them to the global
and Sectoral Industrial Environment through participation in various seminars,
Conferences, institution based training in the educational institutes and Original
Equipment Manufacturers facilities.

SAFETY TRAINING:

Under VT Rules, various trainings such as Initial, Refresher and special trainings
are imparted to the workers working in mines. This purpose is fulfilled by 12
VTCs located in different Areas of SECL. Additionally, Contractors workers, who
play an important role in todays scenario, are also imparted initial and Refresher
training in our VTCs. As per recommendation of 8 th /9th Safety Conference, the
supervisors are provided Safety Training in the respective Institutes.

Executive Establishment Department:

Executive Establishment Departments function is to recruit executive

employees for the SECL.

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Chapter 5
Findings, conclusion & Recommendations

Findings:

Firm operates on principal of management.

Human resources are the key for organization.
The application of management function such as planning, organizing,
direction, control is significant and is in practice.
The HR possesses the managerial qualities so as to manage the firm
efficiently effectively and economically.
Importance of communication at each stage.
Contribution of the company to the people.
Safety measures & facility is available and emergency equipment acts
greatly.

Recommendations:

as per my observation I would recommend the company to adopt to the

latest technologies for the accounting process. As they are following
traditional manual methods of accounting which leads to inefficiencies.
The maximum expenses of the company i.e. around 63% of the total
expenses are being spent on salaries which should be reduced

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by adopting the latest technique of mining which will intern reduce the total
cost of the company and henceforth the salary.

Conclusion:

SECL possesses exceptional strength, if channelized in a right direction can

contribute significant to the society. SECL achieved an excellent score in the self-
evaluated report of compliance of Corporate Governance. SECL practice and
promote anti-corruption and transparency through Vigilance department, whistle
blower policy, surprise inspection, awareness on anti -corruption and code of
conduct.

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Bibliography:

Primary data by visiting the plant

Secondary data collected inside the firm
www.secl.nic.in
www.cl.nic
Wikipedia
Journals and magazines
http://www.yourarticlelibrary.com/organization/8 -types-of-
organisational-structures-their-advantages-and-
disadvantages/22143/

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