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INTRODUCTION

Indian Oil Corporation Limited, a wholly owned Government Company was


incorporated on 30 June, 1959 to undertake marketing functions of Petroleum
products. Later, Indian Oil Corporation Limited (IOCL) was set up.

On 1 st September, 1964 by amalgamating the Indian Refineries Limited (Started


in August, 1958) with the Indian Oil company Limited.

For the better coordination of refineries and marketing, in 1981 it took over a
private Oil Company by the name of Assam oil Company and created a separate
division in the name of Assam oil Division (AOD). In 1999 Indian Oil was given
Navratana status by the government of India and Maharatna(the company will be
allowed to investment decision up to Rs 5000 crore independent of Govt.). In 2007, it
merged its subsidiary IBP and created a separate division in the form of IBP Division
and as per available information as on 04/03/09 IOCL is in the 8th position in the list
of Navratna. Indian oil is India’s flagship company, accounting for 56% petroleum
products market share, 42% national refining capacity and 69% downstream pipeline
transportation network. It has a country’s largest network of crude product, with a
combined length of 9000 Kms and 54.20 MMTPA capacity. During the year 2000-
2001, Indian oil became the first company to surpass the ‘Rupees one hundred
thousand crore sales turnover’.

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BASIC REFINERY MODEL

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OBJECTIVES OF THE STUDY:

 To know the organization structure and the process of activities.


 Analyzing the function of each department.
 To identify the strength and weakness of all the departments.
 To study the growth, objectives and achievements of all departments.
 To give suggestion for the purpose of improving the performance of all
departments.

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INDUSTRY PROFILE

Assam Oil Division of the Indian Oil Corporation Ltd. and is regarded as the
birthplace the country's petroleum industry. It was in this region that the pioneers
struck oil in the midst of dense jungles at a time when there was hardly any industrial
development in the country. The Digboi Refinery, commissioned in 1901, is today
India's oldest operating refinery and one of the oldest operating refineries in the
world. In fact, it was the only refinery in India till the mid 1950's. Earlier owned and
operated by the Assam Oil Company ltd. It came into the fold of the Indian Oil
Corporation ltd. by an Act of Parliament on 14th October 1981 and became Assam Oil
Division of Indian Oil Ltd.

Indian Oil Corporation Limited. The Group's principal activities are manufacture and
market petroleum products, crude oil, lubricants and grease, oil base and additives and
other petroleum related products. The Group operates in two segments: Petroleum
Products and Other Businesses. Other business includes sale of imported crude oil,
sale of gas, petrochemicals, explosives and cryogenics, wind mill power generation
and oil and gas exploration activities jointly undertaken in the form of unincorporated
joint ventures.

Indian Oil Corporation Ltd. operates a network of 10329 km long crude oil and
petroleum product pipelines with a capacity of 71.60 million metric tonnes per
annum. Cross-country pipelines are globally recognized as the safest, cost-effective,
energy-efficient and environment-friendly mode for transportation of crude oil and
petroleum products.

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THE INDIAN OIL FOUNDATION

As part of the Corporate Mission ‘to help enrich the quality of life of the community
and preserve ecological balance and heritage…’, Indian Oil Corporation has set up
The IndianOil Foundation as a non-profit Trust to protect, preserve and promote our
national heritage and culture, in collaboration with the Archaeological Survey of India
and the National Culture Fund of the Ministry of Culture.

The Indian Oil Foundation will adopt at least one heritage site in every State and
Union Territory. Archaeological works will be funded by the IndianOil Foundation to
the Archaeological Survey of India through the National Culture Fund. Five
prestigious sites have been identified, viz., Qutb Minar, Delhi; Khajuraho, Madhya
Pradesh; Hampi, Karnataka; Kanheri Caves, Maharashtra; and Konarak, Orissa. The
IndianOil Foundation will develop world-class facilities and conveniences for visitors.
Indian Oil Corporation will provide refueling facilities for travelers and also
undertake community development in the neighborhood.

HISTORICAL VIEW OF IOCL:


In 1825, Army officers touring the jungles of upper Assam found Petroleum oil
exuding from the river.
In 1866, first oil well drilled at a depth of 120 ft, proved dry.
In 1882, Assam Railways and trading co. (AR&T CO.) come across oil seepage
at Digboi.
In 18989, first commercial well struck in Digboi at a depth of 662 ft.
In1893, AR&T CO. installed a tiny refinery at Margherita.
In 1899, Assam Oil Company formed.
In1901, capacity of 500 barrels (20000 gallons) per day.

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In 1902, Assam oil company (AOC) began marketing kerosene oil in the north-
east.
In 1921, Burma Oil Company (BOC) took over control of Assam Oil Company
operation of Digboi Oil field and refinery.
In 1922, Digboi refinery completely rebuild and capacity expanded by Burma Oil
Company (BOC), the owner manager of Assam Oil Company.
In 1928-40, crude units, cooker, KTU, wax units, boilers, power houses are
added.
In1966, Assam Oil Company took over marketing from Burma Oil Company and
gave the brand name “Assam Oil”.
In 1981, the government of India took over Assam Oil Company/Burma Oil
Company’s interest in India and merge Assam Oil Company with Indian Oil
Corporation, by an act of parliament but retained as division (Assam Oil Division)
with integrated refining and marketing operations.
In 2001, VRSD pilot plant commissioned and.
In 2002, merit certificate in best house keeping, in dealer’s conference held at
Digboi on 20th June 2002.
In1901, capacity of 500 barrel (20000) per day.

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COMPANY PROFILE

INDIAN OIL CORPORATION LIMITED


Indian Oil Corporation Ltd. (IndianOil) is the largest commercial enterprise in
India, and the only Indian presence in the Fortune magazine’s “global 500” listing of
the world’s largest corporations, with a ranking of 226 for fiscal 2001. In the ‘Forbes
International 500’ list of the largest companies outside US, IndianOil is ranked 112
and tops the four Indian companies in the listing. In addition to being the largest
national oil company in the Asia Pacific region, IndianOil has also been ranked ‘First’
in Petroleum Trading among the 15 national oil companies in the region in the 2001
Industry Perception Survey conducted by Applied Trading Systems, Singapore.
Indian Refineries Ltd. And Indian Oil Company Ltd. was set up in 1958 and 1959
respectively, to build national competence in the oil refining and marketing business.

On 1st September 1964,IndianOil owns and operates in seven country’s 18


refineries, at Digboi, Panipat, with a combined capacity of 38.15 million metric tones
per annum (MMTPA). A new MMTPA grassroots refinery is being set up at Paradip
in Orissa. In addition, IndianOil has two subsidiary companies, Chennai Petroleum
Corporation Ltd. And Bongaigaon Refinery and Petrochemicals Ltd., with a
combined refining capacity of 9.35 MMTPA, thereby raising its total refining
capacity to 47.50 MMTPA, the highest in the country today. IndianOil has the
country’s largest network to crude and product pipelines, with a combined length of
6,523 km and a capacity of 43.45 MMTPA. With sales of 47.17 million metric tones
in 2001-02, IndianOil holds over 53% of the petroleum products market share in
India. Its extensive network of over 22,000 sales points is backed for supplies by 182

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bulk storage points and 78 Indane bottling plants. 92 Aviation Fuel Stations cater to
the Aviation Industry, defense as well as civil.

India’s flagship national oil company and downstream petroleum major, Indian Oil
Corporation Ltd. (IndianOil) is celebrating its Golden Jubilee in 2009. It is India's
largest commercial enterprise, with a sales turnover of Rs. 2, 85,337 crore – the
highest-ever for an Indian company – and a net profit of Rs. 2, 950 crore for the year
2008-09. IndianOil is also the highest ranked Indian company in the prestigious
Fortune 'Global 500' listing, having moved up 11 places to the 105th position in 2009.

IBP Co. Limited, a stand-alone marketing company and a subsidiary of IndianOil,


has a nationwide network of over 1,550 retail outlets.

IndianOil’s Research and Development Centre has been engaged in world-class


research in tribology (lubricants formulation), refinery processes and pipeline
transportation. The Centre has developed over 2000 lubricant and grease
formulations, and obtained approvals of original equipment manufacturers in India
and abroad.

A wholly owned subsidiary, Indian Oil blending Ltd., manufactures over 450
grades of the country’s leading R brand of lubricants and greases. In pursuit of its
Vision of becoming ‘ a major, diversified, transnational, integrated energy company,
with national leadership and a strong environment conscience, playing a national role
in oil security and public distribution’, IndianOil is proactively identifying and
developing business opportunities in Exploration & Production (E&P), Gas and Gas-
to-Liquid, Petrochemicals, Power, Information Technology & Communications,
Collaborative R&D, Exports, Shipping, Training & Consultancy, Engineering &
Construction, and Transnational Operations. Twelve joint Ventures are now
operational in partnership with some of the leading international and Indian
companies;

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• Avi-Oil (India) Pvt. Ltd. With NYCOSA, France, and Balmer Lawrie & Co. for
manufacturing and marketing Defense and civil aviation lubricants and specialties.
• The cover depicts a bird, symbolizing IndianOil, breaking through barriers to seek
new horizons.
• It is a quest marked by immense possibilities a quest for progress through pursuit of
new opportunities.
• The colour blue signifies the vast expanse of a new world, and is a tangible expression
of widening horizons.
• Indian Oiltanking Ltd., with Oiltanking (India) GmbH, Germany, for infrastructure
development and terminalling services.
• Petronet India Ltd. (PIL), a consortium of oil companies and financial institutions, for
petroleum product pipeline projects.
• Petronet Vadinar-Kandla Ltd., as a subsidiary of PIL, for Vadinar-Kandla product
pipeline.
• Petronet Chennai-Trichy-Madurai Ltd., also as a subsidiary of PIL, for Chennai-
Trichy-Madurai product pipeline.

IndianOil is marketing diesel fuel additives for automobiles in collaboration with Elf
Antar; France.IndianOil Air BP is collaborating in aviation fueling business.

IndianOil’s investments in creation of assets will exceed Rs. 40,000/- Crore over
the decade beginning 1997. These investments, substantially funded from internal
resources, will result in expansion and modernization of existing capacities, as well as
creation of state-of-the-art facilities.

IndianOil is an “academy” company with 18training centers. The IndianOil


Institute of Petroleum Management (IIPM), Gurgaon, serves as an apex training and

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consultancy institute and conducts management development programmes in
association with reputed national and international institutes.

Indian Oil Management Centre for Learning (IMCL) recently set up in Mumbai
will facilitate in upgrading the functional knowledge and skills of the employees and
also impart behavioral training.

For the past two decades, IndianOil has been lending its expertise to several
countries in areas of refining, marketing, transportation, training and R&D. These
include Sri Lanka, Kuwait, Bahrain, Iraq, Abu Dhabi, Tanzania, Ethiopias, Algeria,
Nigeria, Nepal, Bhutan, Maldives, Malaysia and Zambia.

IndianOil’s commitment to quality, safety, health and environment is reflected in the


series of national and international certifications and awards earned over the years.

The 17th largest petroleum company in the world, Indian Oil, is now emerging as
a transnational energy conglomerate. From the icy slopes of Leh in the Himalayas to
Kanyakumari where the Bays of Bengal and the Arabian Sea join the Indian Ocean,
and from the Single Buoy Mooring at Salaya in the West to the Monasteries at
Tawang in the East, IndianOil lives in every heart and in every part of India.

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CORPORATION STRUCTURE OF
INDIAN OIL CORPORATION
LIMITED

BOARD

CORPORATE DIVISION

FINANCE INCLUDING REFINERIES


INTERNATIONAL

MARKETING
HUMAN RESOURCE

COMMUNICATION/
PIPELINES
INFORMATOIN

SYSTEMS
RESEARCH AND
DEVELOPMENT
PLANNING AND
BUSINESS
DEVELOPMENT

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DIVISIONAL STRUCTURE OF
INDIAN OIL CORPORATION LIMITED

MARKETING HO

4 REGIONAL OFFICES

15 STATE OFFICES

TERMINA LPG AREA AFSs


34DIVISIONAL OFFICES

OFFICES

DEPOTS LUBE GODOWNS

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DEPARTMENTS

Indian Oil Corporation Limited constitutes of various departments which helps the
organization to function properly and to attain the ultimate objectives.

The organization has four functional departments and they are:

 Human Resource Management: It helps in taking decisions regarding Human


Resource Policies, employee engagement and creating a good working condition in
the organization.

 Marketing Management: It is mainly involved in promoting the product of the


organization and increasing the sales.

 Financial Management: It deals with the monetary transaction and maintaining


various accounts so as to keep a clear check on the day to day financial activities.

 Production Management: It is mainly involved in transforming the raw materials


into the final product. It helps into smooth flow of products so that the organization
can meet the demand of its consumers.

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HUMAN RESOURCE MANAGEMENT

THEORETICAL FRAME WORK


Organisations are made up of people and function through people. Without
people organisation cannot exist. The resource of man money material and machinery
are collected, coordinate and utilize through people. The resources by themselves
cannot fulfill the objective of the organisation. They need to be united into a team. It
is through the combined effort of people that material and monetary resources are
effectively utilized for the attainment of common objective. Without united effort
human effort no organisation can be achieved its goals. All the activities of an
organisation are initiated and completed by the persons who make up the
organisation. Therefore peoples are the most significant resources of any organist ion.
The resource is called human resource and it is the most important factor in
production.

From the national view point human resource may be defined as “the knowledge,
skills, creative, abilities, talent and aptitude obtained in the population”. From the
view point of an organisation, human resource represents the people at work.

CONCEPT AND NATURE OF HRM


Human resource management may be defined as set of policies, practices and
program designed to maximize both personal and organisation goal. It is the process
of binding people and organisation together show that the objective of each are
achieved. According to flippo personnel management or human resource management
is “the planning, organizing directing and controlling of the procurement,
development, compensation, integration maintenance of human resource to the end
that individual, organisation and social objectives are accomplished.

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ORGANISATION SETUP AND ROLE OF PERSONNEL
DEPARTMENT
“A system approach to personnel in which the emphasize is on the inter-
relationships among various policies and programs of organisation. It involve
anticipating the future patterns of an organisation and of business environment and
then relating manpower requirements to these conditions“

PERSONNEL & ADMINISTRATION DEPARTMENT


The personnel, administration, management services, HRD & training corporate
communication department at refineries HQ are headed by ED(HR) with the
following functions under his charge:

• Personnel

• Administration, welfare & Hindi implementation

• Training & development

• Management services

• Corporate communication.

OBJECTIVES
The primary objectives of personnel department are as follows :

• Design and develop an organisational structure with well defined relationship


commensurate with the business plans and corporate strategies;

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• Promote and develop co-operative attitude amongst employees by fostering
harmonious relations at all levels and inculcate sense of belonging;

• Promote and inculcate the culture of employee participation in management;

• Change agent to new interventions.

FUNCTIONS:

STAFFING

• Manpower planning

• Determine the organisation structure and optimize manpower to effectively meet


company’s objective

• Job description

• Recruitment

• Personnel records

• Promotions

• Transfer

PERSONNEL MAINTENANCE
• Motivation

• Performance appraisal

• Recreation

• Communication

• Employee amenities- canteen, clubs etc.

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• Safety

• Medical service

• Securities

DEVELOPING HUMAN RESOURCE


• Induction and apprentices training

• Training and development of employee

Industrial relations
 Productive bargaining

 Grievance handling

 Discipline administration

 Providing joint consultive machinery-joint management councils

COMPENSATION
• Wages ,salary surveys & controls

• Negotiation

• Incentives/bonus

PERSONNEL POLICY & PLANNING


 Defining organisation goals policy guidelines and strategies

 Formulating and implementing personnel policies

MANPOWER

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Manpower is the one of the essential and vital part of the organisation. To
maintain manpower human resource management plays an important role from
decade ago. the basic requirements of the human resources for the company is noted
by the HRM departments.
Some important measures for maintaining human resources (manpower)
• Recruitment

• Post recruitment action & records

• Promotion and transfer

• Officiating appointments

• Probation and conformation

• Seniority

• Deputation

• Forwarding of application & foreign assignments

RECRUITMENT
Procedure of recruitment
• Recruitment through employment exchange

• Recruitment through advertisement in news paper

• Internal promotions

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• Transfer on deputation from government department or other public sector
undertaking

• Notification of vacancies .

There are two type of categories are there for recruitment

1) Officers

2) Non-Officers

OFFICERS

• Campus recruitment

• Advertisement

• A employee who is working in non-officers grade and have not been


completed his/her 5 years of service can apply for officers grade

• Advertisement on web site of corporation

NON-OFFICERS

• Selection done in the local region of division by employment exchange

• Notifications through news paper etc

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PROMOTION & TRANSFER

Promotion is based on the percentages allotted by the government .

 Based on merit

 Based on seniority

 Based on merit+ seniority

 Based on qualification

POST RECRUITMENT ACTION AND RECORDS

JOINING REPORTS

Every new appointee is required to submit a joining report accompanied by


medical certificate of fitness , duly completed attestation form and other documents
/testimonials as per the terms and condition of the appointee

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MEDICAL CERTIFICATE OF FITNESS ON FIRST APPOINTMENT

To be eligible for appointment in the service of the corporation . every


appointee has to submit a medical fitness certificate as per the prescribed
guidelines/format from the corporation’s chief medical officer as may be advice in the
offer of appointment . Before joining the corporation .

The candidate referred for pre-employment medical examination should either


be declared as fit or unit by medical officer and in case of later, the offer of
appointment should be cancelled or withdrawn.

MARITAL STATUS

A person who has entered into or contracted a marriage with a person having
spouse with another person is not eligible for the appointment in the service of the
corporation. Unless exempted by the director from the operation of the rule, based on
adequate justification

DATE OF BIRTH

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Personal department will record the age of every employee in sap data/ his ‘p’
file .

The date of birth once admitted shall not thereafter altered on any grounded
whatsoever.

PROBATION AND CONFORMATION

PERIOD OF PROBATION

 Employee join in grade ‘A’ of officers on appointment/selection/promotion (1-


year)

 Employee join in grade I/IV of non-officers on appointment/selection/promotion


(6-months)

 Promotion [except on promotion to grade ‘A’, grade ’H’ , and grade ‘I’] (6-
months)

 Promotion of grade ‘H’ & ‘I’ (1-year)

SENIORITY FOR OFFICER

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Direct recruitment

• Seniority as between person on fresh appointment shell be determined according


to date of joining of the service

• Where two or more appointee join on the same date ,their inter-se seniority shall
be reckoned according to their date of birth

FOR NON-OFFICER

Direct recruitment

• Seniority as a rule of thumb will be according to the date of appointment in the


regular scale of pay

• Seniority as between person on fresh appointment selected by the selection


committee at the same interview shall be determined according to order in the
merit list, irrespective of the date of joining.

DEPUTATION
Deputation in corporation’s interest
In the interest of the corporation, employees of the central/state
government , public sector undertaking or some other organisation may be
temporarily engaged on deputation in consideration of the nature of vacancies ,
special attainments of the persons concerned or the special requirements of certain
posts or for any other circumstances justifying appointment of such deputations as per
govt. guidelines on the subject.
Forwarding of applications
In deciding whether an application should be forwarded or withheld ,the
concerned authority should balance the interest the necessity of avoiding hardship to
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the individual. The term ’interest of the corporation’ should be interrupted strictly and
subject to that consideration.

HOLIDAYS
Festival holidays
• 10 paid festival holidays

• Inclusive of 3 national holidays ( 26th January-republic day, 15th august-


independence day, 2nd October- Gandhi jayanti )

Additional holidays

On the death of high designation. The administration offices and other units of
IOC are to be closed as per guidelines issued by BPE under which the officers/units
are to be closed only on the death of the president on the day of funeral takes place.

AWARDS
Period of service Award
15 years 5gm gold coin
(24ct)
25 years 10gm gold coin
(24ct)
30 years 20gm gold coin
(24ct)
35 years 20gm gold coin
(24ct)

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INDIANOIL SUGGESTION SCHEME:
The scheme hereunder named as “Indian oil scheme” harnessing the latent
creativity in every individual there by fostering amongst the employees a sense of
achievement and a feeling of involvement in the growth of organization.

OBJECTIVES:
 To provide well designed procedure for receiving, evaluating and rewarding
creative ideas of the employees

 To promote individual creativity for organisation excellence

 To improve quality , productivity , safety service and economy through employees


enterprise

 To enhance job satisfaction , sense of belonging and employee participant

SCOPE OF SCHEME:
Category 1:
All regular employees of IOCL are eligible to give the suggestion
Category 2:
Regular employees of IOCL who are on deputation to other organisation are
also eligible to give their suggestion pertaining to the business of IOCL
Category 3:
Deputationists from other organisation of IOCL are also eligible to give their
suggestion pertaining to the business of IOC

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TRAINING
ON THE JOB
ORIENTATION

JOB INSTRUCTION

APPRENTICE

INTERNSHIP

JOB ROTATION

COACHING

OFF THE JOB


VESTIBULE

LECTURE

SPECIAL STUDY

FILMS

TELEVISION

CONFERENCE

CASE STUDY

ROLE PLAY

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METHODS OF TRAINING ADDOPTED BY IOCL
ON THE JOB
ORIENTATION

Orientation is a program conducted when a new batch is selected in to an


organization. Orientation is a brief introduction of the company and the job that is to
be work upon. It gives a bird view of the organization.

JOB ROTATION

Here the employees are made to take up other responsibilities. This happens very
frequently in all other organisation. This helps then to gain more knowledge .jobs are
being rotated. Therefore every person gets to do different work at a time.

OFF THE JOB


CONFERENCE

This takes place for the higher level of the organisation .presentation,
discussions are held with a plane of member.

LECTURE

This is like a class room lecture where, an expert would come and give a
detailed lecture on the subject to be worked upon.

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SOCIAL SECURITY MEASURE
The concept of social security is essentially related to the high ideals of human dignity
and social justice. It is preliminary and instrument of social and economic justice.
According to ILO social security is the protection which society provides for its
members through a serried of public measures, against the economic and social
distress that otherwise would be caused by the stoppage or substantial reduction of
earning resulting from sickness, maternity, employment, injury, unemployment,
invalidity, old age, and death, the provision of subsidies for families with children.

SCOPE OF SOCIAL SECURITY


The scope of social security is very wide through the social security programmes
differ from country. Generally, social security schemes are of the following types.
1. Social insurance: under it the workers and employers make periodical contributions,
with or without a subsidy from the government. The funds so collected are used to
provide benefits without testing his/her financial position. Provident fund and group
insurance are examples of this type.
2. Social assistance under it the cost of the benefit provided is financed fully by the
government without any contributions from workers and employers. However, benefit
is paid after judging the financial position of the beneficiary. Old age pension is an
example.

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EMPLOYEE PROVIDENT FUND
• All employees are eligible to join the PF scheme from the date of their joining.
• An equal contribution for 12% of the basic and DA from the employer and their
employee (through an employee’s contribution can go up to 100% of basic+da).
• Administrated by a trust, the fund money is invested in the pattern prescribed by the
EPF act 1952.

Tax free benefits of the PF will be received in the event of:


 Retirement/permanent disablement, forcing the employees to leave the
company.
 Retirement, migration abroad for permanent settlement.
 Transfer of PF fund to another establishment.
 Death.
EMPLOYEES PENSION SCHEME
The salient features of the above scheme, which has come to effect from 16th
November 1995, are as follows:
 Employer and employee contribution to the fund up to 15th November 1995 will
remain intact and would be paid to the employee at the time of retirement
registration, death etc, as per the provision of PF act.
 Maximum services for eligibility to persion are 10 years subscription to EPF. In case
the services are less than 10 years, a lump sum amount is refunded, as laid down in
the scheme.
 From 16th November 1995 onwards 8.33% of Basic+DA (on maximum of 50000) of
employer’s contribution to PF will be deposited with the PF authorities towards the
pension fund.

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 Under new pension scheme, in of death of the member after retirement,
widow/widower and up to two children below the age 25 years would be entitled for
the pension as per the scheme.
 Retirement age is 58 years. Those resigning earlier and beyond the age of 50 can opt
for pension but we have to discount @ 6% and up to maximum of 25%.

GRATUITY
The gratuity scheme is similar to the one lays down in payment of gratuity act
and approved by the income tax authorities and is administered by trustees.
 The scheme covers all permanent employees.
 Gratuity is paid on occurrences of any of the following.
 Retirement, registration, permanent disablement or death.
 A minimum continuous service of 5 years is required for payment, except in
case of death/permanent disablement.

RETIREMENT FUNCTION
A small function will be arranged on the day of retirement. He will be
rewarded with the PF and gratuity cheques. If the person happens to be member of the
union he will be presented with a gold ring on behalf of the workmen.

INSURANCE
Employee deposit linked insurance. The IOCL employee group insurance
scheme is a more favorable substitute for the employee deposit linked insurance
scheme.
 Applies to all those covered by the EPF scheme.

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 Provides financial assistance to family member in case of an employee’s death
while in service.
 The company pays premium to LIC.

SAFETY PROGRAMS
The following are the various safety measures taken at IOCL.

MANAGEMENT COMMITTEE
The management is totally committed to promote a safe working environment
to the employees. Top priority is given to improve the areas to promote safety. To
demonstrate the commitment of the management, the general manager of the site
chairs all the safety committee meeting and personally inspects the sites that are
identified as unsafe conditions, along with the safety committee.

SAFETY COMMITTEE
This comprises of the total membership of 19 the committee is chaired by the
site general manager and it has representation from engineering is on the basis of
action prone section.

SAFETY DAY CELEBRATION


Safety day will be celebrated on 4th of March. On this day, presentation on
safety will be given to the workmen by government officials, quizzes will be
conducted.

EMPLOYEE INVOLVEMENT

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Employees are involved in various activities of safety programmes and some
of which are detailed as under safety committee meeting. These meeting given an
opportunity
to explore the ideas of all people to improve on the safety aspects. The workmen
representative especially identified several areas where improvements can be made
and bring to the notice of the committee and based on this fed back, suitable action
will be taken. A copy of needs of such meetings is enclosed for ready reference.

RISK ASSESSMENT
Effective 1996, the process of conducting risk assessment has been started the
job of conducting risk assessment is normally given through professional consultant.

ACCIDENT INVESTIGATION
As soon as an accident is reported, the EHS department conducted an accident
investigation along with the shift in charge of the concerned shift. This exercise is
mainly identified the unsafe condition and unsafe acts and to take steps to avoid and
unsafe acts to take steps to avoid recurrence. At the time of such investigation, the
workmen who met with an accident and his co-workmen who witnessed them will be
involved to assess the conditions that have caused the accident.

FIRST AID
Various first aid has been provided at the site to take care of place injuries and
the health of the workmen and the details are as under.

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FULL TIME MEDICAL OFFICER
The first aid cum occupation health centre is under the charge of a qualified
medical officer. Paramedical staff assists him round the clock. The compounders
attend in shift are qualified pharmacists and trained in first-aid. They give first aid to
the injured workmen. Basing up on the severity of the case they sent permanent
workers to the panel hospitals and bad lies to ESI dispensary.

AMBULANCE
An ambulance van with driver has been kept at the site to transport the injured
employees to the nearest ESI hospital for further treatment.

PERIODICAL MEDICAL EXAMINATION


As per the statutory requirement all the workmen employed in hazardous
processes, like acid handling, boilers, canteen, ETP, QA pump houses coal etc, are
subjected to six monthly medical examinations, to assess the occupational health
hazard.

BUILT-IN SAFETY MEASURES


1. Drying in through autoclaves in vacuum and is accordingly designed.
2. Floors are frequently washed to maintain free from oils to prevent slips and falls.
3. Lagging is done on all steam lines. This prevents heat loss to surroundings as well as
protects persons from burns.
4. Most of the coupling and Freon pump etc, are provided with guards.
5. On Freon compressor, pressure gauges and valves are provided for safety.
6. Raw material good owns, buffer salt, Maida, sugar are stacked in proper manner,
leaving clear moving place around and cross bonding to avoid collapse of the stack.

MBA-MSRCASC Page 33
7. Bands are laid around and the storage tanks are located on pedestals. Storage area is
under lock and control.
8. Few of the employees have been trained in fire fighting.
9. Qualified persons supervisors acid handling.
10. Employees are provided with protective wear.

PERFORMANCE APPRISAL IN IOCL


Performance Management System:
Term Description
PMS Performance Management System-The unique
system of managing performance at Indian oil.
Alignment(of Exist when individual and group objectives and
objectives and result contribute directly to achievement of
results) organization results.
Appraisee Every officer whose performance is assessed under
PMS.
Appraiser Every officer who assesses the performance of one
or more appraisees that report to him/her.
Competency Skills and abilities described in terms of behaviours

MBA-MSRCASC Page 34
that are coahable, observable,measurable and critical
to individual performance.
Countersigning The final authority in an individual’s performance
officer appraisal process.
e-Enabled Delivered through software
Final The rating given to an Appraisee after
performance countersignature
Rating
Internal He/she is the first point of contract for any queries
Change Agent on PMS process at his/her location.
Cascade The process of sequentially breaking down
organizational objective and targets into those of
various leveis of the organization.The individual
KRA’s (key result areas) would also include KRAs
over and above these cascaded ones such as
applicable to divisions, units , function areas and
individuals.
Rating scale 5-point scale used to define and assess level of
achivevement on an element.
Reviewer Typically the Appraisers, who is responsible for
reviewing the entire performance process.
Score on an Level of achievement on the 5-point rating scale for
Element KPIs,competencies,values and potential.
Stretch The degree of difficulty built into targets at the time
of performance planning.
Target A measurable and verifiable definition of outcomes
to be accomplished.
Unique Jobs that are held by different individual but are
Role(UR) similar in terms of objectives and outcomes.

Weightage The percentage value(out of 100%) allocated to a


KPI or a section on the basis of the critically,time
and effort required.

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Role-based KRAs that are predetermined for a role in role
KRAs profile.
Section score The summation of each element
Final score Overall score calculated by multiplying each section
score with the section weightage and then
sammating the same. This score is validated by the
e-reviewer.
Key result Critical achievement required to delivered Indian
area(KRA) Oil’s desired business results. Typically are
outcomes that directly contribute to Indian Oil’s
MoU, strategic objectives and operational goals
usually measurable or verifiable.
Additional KRAs that are predetermined for other roles in thr
KRAs organization and the officer can choose among these
if she/he finds necessary
Special KRAs KRAs to be written out by the Appraisee in case
required in his/her performance plan based on
special projects or membership of task forces,
committees etc.
Performance A tool for the appraisee to record significant events
diary or aspect of performance which may be used for
performance discussion review.
Performance The period for which performance is being planned,
period review or evaluated.
Performance A description of KRAs,KPIs and their targets
plan expected to be accomplished during the performance
period.
Proficiency The level at which a set of behaviours is required to
Level be demonstrated in a particular role.
PMS Responsible for centrally administering the e-
Facilitator enabled PMS software.
PMS Tools Tools developed within PMS to facilitate effective ,
usage, roles, rating scales, performance diary etc.
MBA-MSRCASC Page 36
TYPES OF WELFARE SERVICES
Employee welfare services may be classified into two broad categories.
1. Intra mural.
These services are provided with in the establishment these include latrines, urinal,
washing, bathing facilities, crèches, rest rooms shelters, canteens, uniform mercial
aid, recreation facilities subsidized food etc.
2. Extra mural.
These services provided outside the establishment these consists of housing
accommodation, transport, maternity benefits, children’s education, sports, holiday
homes, leave be travel facilities, workers cooperative store, fair price shops, credit
societies, etc.

WELFARE MEASURES IN INDIAN OIL CORPORATION LIMITED


IndianOil Corporation continued its endeavour to upgrade facilities and promote the
welfare of employees. With a view to promote employees’ welfare, Indian Oil
Corporation brought about improvements in policies concerning medical facilities,
allowances at remote locations, Productivity Incentive Scheme and post-retirement
medical facilities.

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Welfare at Digboi has under done a several change over the years. It is no more
viewed as statutory but has been understood as a development need for employees.
Hence the factory has been taken lot of pro active state in field of employees welfare
which includes measures like long service awards, scholarship for workmen children,
activities for the workmen children’s and families like which drawing and painting
etc.

Apart from the compliance of the statutory requirements, the company welfare and
other measures like.
• Long service award
• Children merit scholarship
• Organizing competitions

STATUTORY WELFARE FACILITIES:

SHELTER, REST ROOM AND LUNCH ROOM


In every company employing more than 150 employees, educate shelter, rest
room and lunch room with provision of drinking water, where workers can eat meals
by them.

CANTEEN
At IOCL canteen is run from its inception from 1979 onwards. Canteen is run
by IOCL employee’s society. On the basis of loss management replace it. They are
totally 52 employees who work for canteen with one manager. In canteen
management committee, there is equal participation from both the workers and
management.

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NON STATUTORY WELFARE ACTIVITIES FACILITIES

MERIT SCHOLARSHIP SCHEME


The company has instituted a merit scholarship scheme for providing financial
assistance to the children of IOCL employees to help then in their academic pursuit.

SOCIAL SECURITY MEASURE


The concept of social security is essentially related to the high ideals of human dignity
and social justice. It is preliminary and instrument of social and economic justice.
According to ILO social security is the protection which society provides for its
members through a serried of public measures, against the economic and social
distress that otherwise would be caused by the stoppage or substantial reduction of
earning resulting from sickness, maternity, employment, injury, unemployment,
invalidity, old age, and death, the provision of subsidies for families with children.

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MARKETING MANAGEMENT

INTRODUCTION
IndianOil has one of the largest petroleum marketing and distribution networks in
Asia, with over 35,000 marketing touch points. Its ubiquitous petrol/diesel stations are
located across different terrains and regions of the Indian sub-continent. From the icy
heights of the Himalayas to the sun-soaked shores of Kerala, from Kutch on India's
western tip to Kohima in the verdant North East, IndianOil is truly 'in every heart, in
every part'. IndianOil's vast marketing infrastructure of petrol/diesel stations, Indane
(LPG) distributorships, SERVO lubricants & greases outlets and large volume
consumer pumps are backed by bulk storage terminals and installations, inland
depots, aviation fuel stations, LPG bottling plants and lube blending plants amongst
others. The countrywide marketing operations are coordinated by 16 State Offices and
over 100 decentralised administrative offices.

Several landmark surveys continue to rate IndianOil as the dominant energy brand
in the country and an enduring symbol for high quality petroleum products and
services. The heritage and iconic association that the brand invokes has been built
over four decades of commitment to uninterrupted supply line of petroleum products

MBA-MSRCASC Page 40
to every part of the country, and unique products that cater not only to the functional
requirements but also the aspirational needs of millions of customers.

IndianOil has been adjudged India's No. 1 brand by UK-based Brand Finance, an
independent consultancy that deals with valuation of brands. It was also listed as
India's 'Most Trusted Brand' in the 'Gasoline' category in a Readers' Digest - AC
Nielsen survey. In addition, IndianOil topped The Hindu Businessline's "India's Most
Valuable Brands" list. However, the value of the IndianOil brand is not just limited to
its commercial role as an energy provider but straddles the entire value chain of gamut
of exploration & production, refining, transportation & marketing, petrochemicals &
natural gas and downstream marketing operations abroad. IndianOil is a national
brand owned by over a billion Indians and that is a priceless value.

SERVO LUBRICANTS - TECHNICAL SERVICES


SERVO continues to be the dominant player in the Indian lubricant sector
backed by cutting edge product development, high quality customization and
extensive blending and distribution network. For customers, the SERVO range is a
one-stop shop for providing complete lubrication solutions in the automotive,
industrial, agricultural and marine sectors. In the retailing segment, besides
IndianOil petrol stations, SERVO lubricants are marketed through exclusive
SERVO shops, SERVOXpress centres, auto spare parts and bazaar shops across the
country. IndianOil's technical service Engineers are available on call to provide on
site Tribology consultancy and value added services. Backed by incisive knowledge
of equipment, processes and machinery, IndianOil team can provide solutions to just
about anything - automotive or industrial. You name it, SERVO will tame it.

TOTAL FUEL MANAGEMENT/CONSUMER PUMPS

MBA-MSRCASC Page 41
IndianOil has the largest and most sophisticated integrated petroleum products
supply chain in India. Whether it is an immediate need, a long-term supply contract
or even setting up dedicated storage and handling facilities at your premises our
network is at your service. IndianOil's marketing operations network of storage,
distribution and supply hubs is backed by efficient sourcing, on-time logistics,
custom-designed deliveries and round-the-clock after sales service and consultancy.
Many customers like the Railways, State Transport Undertakings, Steel Plants,
Thermal Power Plants, Textile Mills and Power Plants continue to benefit from
long-term contracts signed with IndianOil for fuels & lubricants supplies and
consultancy. Tapping the expertise that we have built over five decades of working
with a cross-section of customers from a wide-range of industrial sectors,
IndianOil's Bulk liquid fuel supply offerings covers the complete gamut of fuels-
Diesel, Light Diesel Oil, Low Sulphur Heavy Stock, Special Products .

COMMERCIAL LPG/RETICULATED LPG


Besides supplying domestic Indane LPG cylinders to households, IndianOil
also markets commercial LPG cylinders in 19 Kg and 47.5 Kg capacity. The
commercial LPG cylinders are available at market rates and customers can avail of
the superior energy efficiency of LPG in their commercial establishments like
canteens, hotels or even in industrial and fabrication works like cutting, welding,
heating etc. Besides the regular Indane LPG cylinders that are delivered to
doorsteps, IndianOil also offers reticulated LPG systems for large residential
apartment complexes and establishments. Such systems are cost effective and the
gas lines laid to individual homes draw from a bank of LPG cylinders stored safely
in a dedicated place in the building.

LPG (NON-FUEL ALLIANCES)


IndianOil has signed business agreements with reputed companies and brands
for marketing their products through its countrywide network of Indane distributors.
Some of the hugely successful products being currently sold through the network
MBA-MSRCASC Page 42
are Suraksha rubber hoses, Green Label stoves, Zenith and Safex fire extinguishers.
New tie-ups have been signed for marketing Suraksha flame retardant aprons,
CNG/LPG auto kits, e-booking of railway tickets, money transfers, KwalityWalls'
kiosks, Mysore Sandal Soaps, courier services and telecom products through the
Indane network.

RETAIL (NON-FUEL ALLIANCES)


In an effort to tap alternate revenue streams, IndianOil is focused on enhancing its
non-fuel revenues (NFR) through its 195 million sq feet of retail space. IndianOil has
already mapped petrol stations to study the tyrefalls and assess their site potential with
the help of consultants, Technopak Advisors Pvt Ltd. A well-structured roll out plan
is already underway and petrol stations, primarily in the North have been identified
for a pilot study. The NFR model developed will provide for sharing of revenue
streams with the dealer network to enable unlocking of existing retail space value that
both IndianOil and its dealers command. Several alliances have already been forged
with leading brands like Hindustan Unilever Ltd, Dabur, ICICI Bank, Ferns & Petals,
MTR Foods, PVR Cinema, UAE Exchange, Reliance Capital and DHL. If you wish
to partner us in our non-fuel business ventures email your proposal to IndianOil

INDIANOIL AVIATION SERVICE


IndianOil Aviation Service is a leading aviation fuel solution provider in India and
the most-preferred supplier of jet fuel to major international and domestic airlines.
Between one sunrise and the next, IndianOil Aviation Service refuels over 1500
flights – from the bustling metros to the remote airports linking the vast Indian
landscape, from the icy heights of Leh (the highest airport in the world at 10,682 ft) to
the distant islands of Andaman & Nicobar.

Jet fuel is a colorless, combustible, straight-run petroleum distillate liquid. Its


principal uses are as jet engine fuel. The most common jet fuel worldwide is a

MBA-MSRCASC Page 43
kerosene-based fuel classified as JET A-1.The governing specifications in India are IS
1571: 2001 (7th Rev).

IndianOil is India's first ISO-9002 certified oil company conforming to stringent


global quality requirements of aviation fuel storage & handling. IndianOil Aviation
also caters to the fuel requirements of the Indian Defence Services, besides refueling
VVIP flights at all the airports and remote heli-pads/heli-bases across the Indian
subcontinent.

IndianOil Aviation group regularly organises International Aviation conferences


that act as a vital information facilitator with participation from leading international
and all domestic airlines, allied industries, statutory aviation authorities and
government agencies from over 35 countries.

IndianOil is the only oil company in India to market the widest possible range of
fuels used by the aviation industry in India- JP-5, Avgas 100LL, Methanol Water
Mixture, Jet A-1 and aviation lubricants, etc.

Aviation Turbine Fuel (ATF) is dispensed from specially designed refuellers,


which are driven up to parked airplanes and helicopters. Major airports have hydrant
refuelling systems that pump the fuel right up to the filling outlets on the tarmac
through underground pipelines for faster refuelling. Essentially, ATF is pumped into
an aircraft by two methods: Overwing and Underwing. Overwing fuelling is used on
smaller planes, helicopters, and piston-engine aircraft and is similar to automobile
fuelling - one or more fuel ports are opened and fuel is pumped in with a conventional
pump. Underwing fuelling, also called single-point is used on larger aircraft.

MBA-MSRCASC Page 44
LOYALTY PROGRAMMES:
IndianOil's loyalty programmes are designed exclusively to benefit the large
number of its customers who have been patronising the brand for over five decades

XTRAPOWER
The XTRAPOWER Fleet Card programme is a complete smart card-based fleet
management solution for fleet operators and corporates for cashless purchase of fuel
& lubricants from designated retail outlets (petrol pumps) of IndianOil through
flexible pre-paid and credit facilities. The fleet card also offers an exciting rewards
programme and unique benefits like personal accident insurance cover and vehicle
tracking facilities. In just under two years of its launch, it has emerged as the largest
fleet card in the country with the widest retail outlet coverage. Any business entity
owning or operating a vehicle fleet can become a member of the XTRAPOWER fleet
card programme at a nominal annual charge. Each fleet owner is issued a Fleet
Control Card and vehicle-specific Fleet Cards for every vehicle enrolled under the
programme. For enhanced security, the fleet card transactions are authorised through
a unique Personal Identification Number (PIN). Moreover, the card can help track
each vehicle's movement across remote corners of the country, leading to an
improvement in vehicle utilisation and route compliance. XTRAPOWER is also
backed by IndianOil's vast infrastructure network and web-based support services.

XTRAREWARDS
IndianOil XTRAREWARDS is India's first online rewards programme that seeks
to inculcate the habit of redeeming points. It is currently active in Mumbai, Delhi,

MBA-MSRCASC Page 45
Chennai, Ahmedabad, Bengaluru, Bhubaneshwar, Coimbatore, Mysore, Pune and
Secunderabad, with plans to reach other cities soon. The loyalty programme rewards
customers paying by cash, credit and debit cards. Each transaction is confirmed online
through a charge slip and customers can earn points on fuel/lube purchases at
participating IndianOil retail outlets. Additional points can also be earned outside the
IndianOil network, covering prominent FMCG, Food, Automobile, Travel,
Entertainment, Apparel and Hospitality sectors. Apart from redeeming the
accumulated points instantly on fuel / SERVO lubricants at participating retail outlets,
card-holders can also redeem the points to get exciting gift items from a catalogue.
The redemption on gifts can be registered either from the participating retail outlets or
from the comfortable confines of one's home through the 24x7 IVRS Help Line (1800
22 4111). The programme continuously provides the cardholder with privileges,
benefits and offers from a large number of alliance partners, including restaurants,
pizza companies, automobile service stations, jewellers, and online shopping
companies.

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PRODUCTION

PRODUCTION DEPARTMENT CONTAINS FOLLOWING UNITS


• ATMOSPHERIC DISTILLATION UNIT( AVU)
• Catalytic Reformer Unit (CRU)
• DELAYED COKING UNIT (DCU)
• Hydrotreater and Amine Treating Unit(HDTU)
• Hydrogen Generation Unit (HGU)
• HEIGH PURITY NITROGEN UNIT(HPNU)
• Solvent Dewaxing / Deoiling Unit (SDU)
• SULPHUR RECOVERY UNIT (SRU)
• SOUR WATER STRIPPING UNIT (SWSU)
• WAX HYDROFINISING UNIT (WHFU)

MBA-MSRCASC Page 47
TOTAL PRODUCTIVE MAINTENANCE

TPM DEFINITION:
A Company-Wide Team Based Efforts To Build Quality Into Systems And To
Improve Overall Plant Effectiveness.
TOTAL:
• All Employees Are Involved.

• It Aims To Eliminate All Accidents, Defects, Wastage, Losses And System Problems.

PRODUCTIVE:
• Actions Are Performed While Maintaining System Integrity.

• Troubles For System Are Minimised.

MAINTENANCE:
• Keep In Good Condition.

• Repair, Clean, Clear, Lubricate.

TPM Combines Preventive Maintenance With Total Quality Control And Total
Employees Involvement To Create A Culture Where All Employees Develop
Ownership Of Their Equipment And Operating Systems And Become Full Partners
With Engineering And Maintenance To Assure Equipment And Systems Operate
Properly And Effectively Everyday.

MBA-MSRCASC Page 48
AIM OF TPM:
1. Achieving World-Class Standards Of Performance By Eliminating All Losses And
By Adhering To Optimized Efficient Refinery Operation, Maintaining Highest Safety
Standards.

2. Inculcating A Complete Cultural And Attitudinal Change In The Employees To


Foster Ownership Of The Equipment And Plants And To Promote Continuous
Improvement In Work Environment.

3. Reduction In Cost Of Production While Maintaining Highest Standards In Product


Quality To Achieve Customer’s Delight, With An Ultimate Aim To Increase Profits
And Growth Of The Division And The Corporation As A Whole.

TOTAL PRODUCTIVE MAINTENANCE

TPM is a world class manufacturing strategy for optimizing the effectiveness of


manufacturing equipment.

The goal of the TPM program is to drastically increase production while, at the
same time, increasing employee morale and job satisfaction.

TPM was introduced to achieve the following objectives:

• Avoid waste in a quickly changing economic environment.


• Producing goods without reducing product quality.
• Reduce cost.

MBA-MSRCASC Page 49
• Produce a low batch quantity at the earliest possible time.
• Goods send to the customers must be non defective.

TPM HAS 8 PILLARS, EACH BEING SET TO ACHIEVE A “ZERO”


TARGET:

1. Focused improvement (kobetsu-kaizen): for eliminating waste.


2. Autonomous maintenance (jishu-hozen): the operator is the key player. It involves
daily maintenance activities carried out by the operators themselves that
prevent the deterioration of the equipment.
3. Planned maintenance (keikaku-hozen): for achieving zero breakdowns.
4. Quality maintenance (hinshitsu-hozen): This is actually “maintenance for quality”. It
includes the most effective quality tool of TPM: “poka-yoke”, which aims to achieve
zero loss by taking necessary measures to prevent loss.
5. Education and training: for increasing productivity
6. Early equipment/product management: to reduce waste occurring during the
implementation of a new machine or the production of a new product
7. Safety, hygiene, environment: for achieving zero work-related accidents and for
protecting the environment.
8. Office TPM: for involvement of all parties to TPM since office processes can be
improved in a similar manner as well.

THE ‘PQDSM’ CONCEPT:


P- Productivity Enhancement
Obtain Minimum 90% Ope. (Overall Plant Effectiveness)
Obtain Minimum 90% Oee. (Overall Equipment Effectiveness)

Q- Quality

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Operate In A Manner, So That There Are No Customer Complaints.

D- Delivery
Achieve 100% Success In Delivering The Goods As Required By The Customer.

S- Safety
Maintain An Accident Free Environment

M- Morale
Increase The Suggestions By 3 Times, Develop Multi-Skilled And Flexible Workers

MBA-MSRCASC Page 51
TPM BRINGS:

Enhanced productivity

Reduced waste
Healthy Environment

Quality Improvement
On Time Delivery
Customer Delight
Zero Accidents

Cost optimisation
Safety

TPM
Team
High spirit
Moral
Team

Collaboration Working

MBA-MSRCASC Page 52
TPM DEVELOPS THE FEELING OF OWNERSHIP

My
Equipments

TPM

My My People
Refinery

MBA-MSRCASC Page 53
MAINTENANCE DEPARTMENT OF IOCL (DIGBOI)

INTRODUCTION
Maintenance and repair of equipment in a Hydrocarbon process plant is defined as
"preserving the machine to operate its design condition with maximum availability at
minimum maintenance cost ".
Maintenance function has become another Profit Centre of any organisation.
Maintenance has gone through a Metamorphosis from "RUN-FAIL-FIX-RUN"
syndrome to a dynamic function capable of Prediction & Prevention of equipment
failure trends and contribution to continuous enhancement of Organizational
Productivity. Maintenance no longer is deemed merely as a Spender Department in
view of its recent transformation into a powerful medium of overall effectiveness of
the organization.
Maintenance function improves organizational productivity by consideration
of:
• Relationship between Loss Structure & Overall Equipment Efficiency
• "Why-Why" Analysis of Equipment Failure
• Observance of development of failure before it turns up
• Failure Analysis
• Prevention of "Recurrence" of Failure
• Quality control as applicable to Maintenance
• Need for Training and Development of Personnel
Plant & Equipment maintenance can often be quite costly in a hydrocarbon
process plant operation. It is the awareness that true cost savings and profitability
can only be achieved by combining machinery reliability, safety, availability, and
maintainability into a cost-effective total.
MBA-MSRCASC Page 54
There are many approaches to perform maintenance and engineering activities at
an operating facility. The type of process, plant size, location, and business
conditions at a particular time are the variables that can affect this approach. The
system must fit the basic overall corporate goals. The final evaluation of success,
however, for whichever system selected, is achieving the lowest possible product
cost over extended periods of time at varying business conditions.
Total plant profitability is obviously affected both by on-stream factors and
maintenance costs. One cannot be separated from the other. Any system, therefore,
must account for how cheaply maintenance can be performed from an organizational
setup, and also what must be done and how often. The ability to update maintenance
requirements and improved planning based on experience at a group of plants has a
large bearing on overall maintenance costs.

(a) Planning Sheets.

Planning in-charge shall prepare detailed planning sheets incorporating all the
jobs and circulate to all concerned one week before the planned shutdown date.

(b) Workshop Fabrication


Simultaneously, Planning in-charge in consultation with Workshop in-charge
and shutdown Engineer, shall finalized the list of jobs to be carried out in the Main
Repair shop and incorporate in the Planning sheets.

(c) Workforce
On assessment of the workforce required (done in consultation with
shutdown Engineer), Planning in-charge shall process the approval from Zonal
Maintenance In-Charge for arranging additional reinforcement either from other
Refineries or on contracts.

(d) Supervisory Force


For additional supervisory force, as required, Zonal Maintenance In-Charge

MBA-MSRCASC Page 55
shall get in touch with other Refineries and ensure their presence in time.

(e) Clearance Schedule


A calendar schedule for all the jobs planned shall be prepared by the
Production Coordinator in consultation with Production In-Charge concerned as well
as Planning in-charge and shutdown Engineer indicating the time when the clearance
for taking up individual jobs shall be available. The manpower requirement for
getting the equipment released shall also be planned and provided.

(f) Blinding Schedule


Production Coordinator shall also prepare schematic diagram in consultation
with the Production In-Charge where the blinds are required to be fixed and furnish
the same to shutdown Engineer.

(g) Shutdown Programme


Planning in-charge shall prepare shutdown programme incorporating .

• Date of shutdown
• Date of completion
• Job list with fixed tag numbers
• Man-hours requirement
• Distribution of the work force as well as date and time of clearance.

He shall also prepare PERT Chart for all major activities. The shutdown
programme so prepared shall be distributed to all concerned and displayed in the
shutdown Engineer's Office.
• Date of shutdown
• Date of completion
• Job list with fixed tag numbers
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• Man-hours requirement
• Distribution of the work force as well as date and time of clearance.

COMMUNICATIONS
Proper communications inters personnel / inter sectional play a vital role in
ensuring success of Management efforts to accomplish the desired objective. The
effective implementation of communication programmes enhances the sense of
participation in all members, in addition to making them 'result' oriented.

LOSS TO COMPANY'S PROPERTY


In the event of any loss to the Company's Property due to thefts, fire or accidents, the
procedures for reporting and follow up would be as follows:
THEFTS:
• For any loss of Company's property due to theft at site, the concerned Engineer
Shall inform about it on telephone immediately to CISF Authorities and bring to the
notice his first observation and also shall keep his superiors and Senior Administration
Officer informed of the same.
• After investigation, on the same day report shall be submitted by Engineer in
writing detailing out the item / items found missing to Senior Administration Officer
with a copy to CISF Authorities and his superiors.
• Further follow up till completion of final investigation and recovery or write off
of the loss, shall be done by the concerned Administration officer who should keep the
Maintenance Manger fully informed.

LOSS OF PROPERTY DUE TO FIRE / ACCIDENTS


• In the event of any loss to company's property on account of fire / accidents, the
first report in detail shall be furnished by the concerned Engineer to functional head
through his superiors.
• Functional Head shall analyze all the facts in detail in association with the Fire
& Safety

REPORTING OF ACCIDENTS
For any accident of an employee on duty, the immediate Supervisor concerned

MBA-MSRCASC Page 57
shall fill up 'Work Accident Form' and send to Medical Officer with a copy to Fire &
Safety Officer. (If the injury is serious, the injured employee takes the Form with him
to the First Aid/Hospital immediately and his Supervisor shall send the form
afterwards).
In case of death or serious bodily injuries, the Supervisor shall intimate the same on
phone to the Senior Medical Officer, Fire & Safety Officer, Chief Personnel &
Administration Manager and his own Departmental Head and shall follow by the work
accident from to the Senior Medical Officer and the Fire & Safety Officer.
In all cases of accidents, the Supervisor shall also send the 'Supervisor's Accident
Investigation Report' to the Fire & Safety Officer within 24 hours of the accident in the
form (prescribed)

HOUSE KEEPING
• Field Maintenance Engineer shall ensure that the place of work is kept clean
and tidy on completion of assigned work. All leftover materials and scraps shall be
removed on the same time on completion of the jobs.
• For keeping the Plant area, loading gantry and other tank-farm area clean, Civil
Section shall provide yard service and shall ensure proper 'house keep-keeping' through
effective coordination with the concerned production personnel.

SAFETY
Application of all safety measures for prevention of personal injuries to the workmen
while on duty shall be primary concern of all supervisors. Engineer/ Senior Engineer to
whom the workman reports shall ensure that all safety appliances required ink the
performance of their assigned tasks are made available to them and also guide them in
application and use of safety appliances.

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FINANCIAL MANAGEMENT

INTRODUCTION

“FINANCE” is the lifeblood and nerve system of any business organization.


Just as circulation of blood is necessary in human body to maintain life, finance is
very essential to the business organization for smooth running of the business.
Financial management involves managerial activities concerned with the
acquisition of fund for business purpose. The finance function does with procurement
of money taking into consideration today as well as future needs and finance is
required to purchase a machinery and raw material, to pay salaries and wages and also
for day-to-day expenses.

MBA-MSRCASC Page 59
METHODS USED IN FINANCING:

NET PRESENT VALUE :


It is the summation of the present value of cash proceeds in each year less the
summation of the present values of the net cash outflows in each year.

PROFITABILITY INDEX :
It is the present value of the return per rupee invested.

INTERNAL RATE OF RETURN :


It is the discount rates which equates the aggregate present value of the net cash
inflows with the present value of cash outflow of a project.

EQUIVALENT ANNUITY :
The equivalent annuity method expresses the NPV as an annualized cash flow by
dividing it by the present value of the annuity factor.

APPLICATION OF MANAGEMENT THEORY FOR DATA ANALYSIS


Capital projects in IOC are divided into :
1. Core – Sector projects eg. refining, marketing, pipelines and R&D.
2. Diversification projects eg. exploration and production(E&P), Liquified Natural
Gas(LNG),petrochemicals and power etc.
3. Globalization projects core/non core projects overseas.
4. Merger/Acquisitions

As per company policies all capital investment proposals above Rs. 100 crores require
board approval:
1. Above Rs. 100 crore : Board
2. Above Rs. 50 crore to 100 crore : Planning & Project

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3. Above Rs. 10 crore to 50 crore : Chairman
4. Above Rs. 10 crore : Fucntional Director
Project costing Rs. 250 crore and above also require approval of Project
Evaluation Committee. All proposals are to be prepared with the assistance of
professionals and experts.
Capital investment analysis involves estimating and comparing the benefits of
these schemes. Its is an exercise that helps Indian Oil to take a decision on he
investment proposal under review. The five basic steps in investment analysis in
Indian Oil are:

• NEED AND JUSTFICATION


• MARKET AND COMMERCIAL ASSESSMENT
• TECHNICAL FEASIBILITY STUDY
• FINANCIAL ANALYSIS
• SENSITIVITY AND RISK ANALYSIS

The final decision on a proposal is taken only after sensitivity and risk analysis. As
the name suggests sensitivity analysis test the proposal’s viability of profitability to
modifications in few variables. The sensitivity of the project to the critical variables is
thereby established. Risk analysis is a more comprehensive extension of sensitivity
analysis as it seeks to examine the profitability of the capital invested subject to
differing combinations of movements of the critical variables. Sensitivity analysis is
the first step towards risk analysis. Both sensitivity and risk analysis enables the
management to comprehend the sources of risk that a project is exposed to over its
projected life period. More important, it enables the corporation to undertake
measures that help to mitigate risk either through risk sharing procedures or through
hedging options. Subsequent chapters shall examine the above issues in detail.

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In case of R&D, any expenditure on development, testing and pre commercial
operation, such as demonstration, pilot and development of prototype will be treated
as R&D expenses. However, any commercial production will have to satisfy the
hurdle rate criteria.

THE NEED FOR A PROJECT MAY BE BROADLY ON ACCOUNT OF:


• Capacity enhancement due to demand and supply imbalance.
• Economic considerations.
• Technical/operational necessity.
• Marketing consideration.
• Improvement in existing operations through removal of constraints/ updation
of technology.
• Govt./strategic policy decisions.
• Safety/environmental and other statutory requirements.
• Expansion into new business – diversification/globalization.
• Research and development activities.

PROJECT COST
An accurate and realizable project cost estimate is vital for appraisal of the
project since it has a direct relation with the economic viability of the project. The
project cost estimates shall be prepared including the following components while
clearly indicating the break up of Rupee and foreign exchange components.

 PRIME COST
 PROVISION FOR DESIGN AND SCOPE CHANGES
 PROVISION FOR CONTINGENCIES
 CONSTUCTION PERIOD EXPENSES
 FINANCING COST DURING CONSTRUCTION PERIOD

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 PRIME COST:
Prime cost of the project includes total cost of the land, building, equipments,
materials, civil construction, other items namely mechanical, electrical,
instrumentation, and safety, fire fighting, pollution control etc. required to complete
the project.

 PROVISION FOR DESIGN AND SCOPE CHANGES:


The provision for design and scope change needs to be justified on case to case
basis. Normally no provision for scope and design change may be required in respect
of repetitive projects where scope is amply clear at the time of preparation a project
cost estimates. Similarly, for projects where quantum of jobs to be executed is
finalized and details of materials/specifications have been clearly determined, no
design change provision needs to be considered. However, in case of grass root
projects such provision not exceeding 10% of the total cost of the project may be
considered to take care of changes in the scope and design due to detailed
engineering.
 PROVISION FOR CONTINGENCIES:
The provision for contingencies not exceeding 3% to 5% of the total estimated
cost can normally be included while estimating the project cost. However, level of
contingency may vary from project to project depending upon the nature.

 CONSTRUCTION PERIOD EXPENSES:


As per statement of accounting policies, the construction period expenses are treated
as under:
Revenue expenses including expenses for crop compensation for acquiring Right-of-
way exclusively attributable to projects incurred during construction period are
capitalized. However, such expenses in respect of capital facilities being executed

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along with the production/operations simultaneously are charged to revenue.
Financing cost incurred during the construction period on loans specifically borrowed
for projects is capitalized at the actual borrowing rates.

 FINANCING COST:
In line of above policy, financing cost during construction period is reflected
separately, whenever applicable. Financing cost incurred on General Borrowings used
for projects is capitalized at the weighted average cost. The amount of such
borrowings is determined after setting off the amount of internal accruals.

FINANCING PROJECTS:
Projects taken up by the corporation are partly financed through internal resources
and partly through specific borrowings. Debt-equity ratio 1:1 is assumed where no
specific financing plans have been finalized. Where financing mode has been decided
then the same are indicated. However the ratio is reviewed on case to case basis. Non-
plan schemes are assumed to be financed from internal resources.
In respect of all those projects where the financing through borrowings has been
envisaged/ assumed, the following issues need to be dealt:
 Extent of the loan available and terms thereof (like rate of interest, repayment
schedule, moratorium, commitment charges etc.)

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 Break up of financing through borrowings into foreign exchange/Indian rupee
component.
 Deferred credit if available.
 For calculating financing cost, latest SBI Prime Lending Rate for long term loan.

DETERMINATION OF CASH FLOWS:


Determination of year wise cash flow cash flows is the most crucial step of the
financial analysis. The cash flow can be determined in 3 components namely:
A.INITIAL INVESTMENT
B.OPERATING CASH FLOWS
C.TERMINAL CASH FLOWS

A.INITIAL INVESTMENT:
This component of cash flows mainly represents net cash outlay in the period in
which the asset is purchased or constructed. In other words, initial investment shall
comprise of the total project cost as indicated in the capital investment proposal and
shall also include incremental value of working capital, wherever required. While
computing initial investment a care needs to be exercised in respect of following: in
respect of proposals where financing through borrowings is envisaged,
receipt/repayment of loans and payment of interest are not considered while
calculating ROI. However, these are to be considered while calculating ROE.

B.OPERATING CASH FLOWS:


The component of cash flow presents year-wise cash flow generated from
operations after the projects has been commissioned. The capacity utilization shall not
be more than 60% in the first year and at 90% from second year onwards till project
life cycle. The determination of operating cash flows shall, therefore, entail estimating
year-wise operating income, input/raw material cost and operating expenses during
the project life.

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C.TERMINAL CASH FLOW:
The cash flow in the terminal year of the project mainly represents the
salvage value of the project plus release of incremental working capital,
salvage value shall be considered as under:
 Land to be valued at original cost
 Other items to be valued at 30% of the original cost without financing cost
 Tax on capital gain should be considered. Capital gains are taken as terminal value
minus written down value as per income tax act.
 Terminal cash flow to be taken in 16th year.

PROJECT LIFE:
For cash flow determination and financial analysis, the life of project is taken as
15 years from the date of completion, unless the project life is shorter.
Issues requiring special-care cash flows:
While determining the cash flows for the projects special care is taken which need to
be exercised in respect of following:
 Cash flow can occur by increase in cash revenue and/or cash saving through reduction
in operating costs.
 Cash outflow can occur by increase in operating expenses and/or decrease in cash
revenue, apart from outgo for initial capital investment.

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 The net cash flow shall be estimated on ‘after tax basis’, as payment of taxes is an
outflow of cash.
 For calculation of IRR, all financial charges arising due to financial leverage like
interest payment/dividend payments are not to be considered as cash outflows.
Similarly, tax shield/benefit allowable due to such financial charges are not to be
considered as cash inflow/outflow.
 For calculation of ROE, interest outgo on project loans, tax shield available and
principle payments are considered. In this case, initial capital outgo shall be limited to
equity outgo.

CORPORATE TAX IS CONSIDERED AS UNDER:


1. Corporate tax to be considered on the project on standalone basis.
2. No tax shield for loss, if any.
3. Loss, if any, is carried forward for adjustment with future profit.
4. Minimum Alternative Tax (MAT) to be considered, wherever regular tax liability
does not arise.
5. All deductions/rebates/benefits etc. wherever available under the income tax act to be
considered.
6. Cen vat credit is not considered.

SUMMARY OF FINANCIAL ANALYSIS:


For the purpose of financial analysis of capital investment proposals, cash flow
estimates are to be prepared for the full project life. These cash flow estimates along
with calculation of ROI/ROE, NPV, DSCR and Break Even Analysis are attached to
the proposal. While considering the base case, capacity utilization shall not be more
than 90% (from 2nd year onwards) throughout the project life cycle for all projects.

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ANALYSIS OF RISK AND SENSITIVITY ANALYSIS AT INDIAN OIL:
After presentation of financial analysis of the project, the capital investment
proposal shall indicate an analysis of risk and uncertainty involved in the proposal.
All capital investment proposals involve some risk or uncertainty with respect to their
completion. Capacity utilization, fulfillment of specified need, safety and profitability
etc. as the underlying assumptions made at the project formulation stage may not hold
well during the project life. Therefore, analysis of risk and uncertainty is an essential
part of sound proposals but also helps in systematic consideration of risk by the
approving authorities.

TYPES OF RISKS:
 FINANCING RISK:
Impact of various risks finally affects the profitability as a result of change in
cash flows from the values considered at proposal stage. Some qualification of
financial involved with a proposal is possible. This quantification helps in decision-
making. Many techniques are available for determining financial risk involved with
the Project like Risk Adjusted Rate, Certainty Equivalent, Sensitivity analysis, DCF,
Break Even Analysis, Probability Assignment, Co-efficient of variation, and Standard
Deviation etc. Most of above techniques rely heavily on the institution of Project
Planner, because he has to give factors for probability or for risk quantification.

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Hence, the results established through such techniques are subjective and therefore do
not provide a clear insight to risk/uncertainty involved. However, sensitivity analysis
is subjective only with respect to the selection of range of variable for determining the
sensitivity. Sensitivity analysis is an excellent tool to know the financial impact of a
variable on the proposal. Therefore, sensitivity analysis shall be used for determining
financial risk of project.

 OTHER RISKS:
Other risks constitute all those risks which may jeopardize
success/completion of the project. In case where need is other than profit, like
operational necessity, government policy, safety, environment etc. there is a risk to
the fulfillment of the same. Following shall come under any risks:
 Risk in getting input/linkage with input sources.
 Risk in disposing output/linkage with market, downstream plants etc.
 Risk in obtaining statutory clearances.
 Risk in capacity utilization due changing in demand/supply situation.
 Performance risk associated with a new technology.
 Risk of technology obsolescence.
 Risk worthiness of technical collaborator.

SENSITIVITY ANALYSIS:
Sensitivity analysis is a quantitative process of measuring change in value of a
dependant variable consequent to change in the value of one or more other variables.
A further aspect of such analysis is evaluation of its sensitivity to possible errors in
estimation of each or some of the critical variable. This information is very valuable
and shall be provided in the capital investment proposal so as to give an overview of
the impact of changes in the value of those variables, which form an essential part of
the analysis. For the purpose of carrying out the sensitivity analysis, it is utmost
necessary in the first place to identify the important variables of the projects. These
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may be assumptions regarding incremental throughout/sales, capital cost, cen vat
benefit etc. after identification of these important variables, sensitivity analysis are
carried out to assess the impact of marginal changes in these variables on final results
of the project i.e. IRR/NPV of the project is also being computed on completion
Project Cost Basis, taking into account average rate of inflation in the following
manner:
 Labour component of the project cost may be updated using the average (of 12
months) of Consumer Price Index (CPI) for industrial workers.
 For all other components of cost except labour the average (of 12 months) of
Whole sale Price Index (WPI) for all commodities may be used.

With the help of sensitivity analysis, it is possible to identify the variables with high
sensitivity and low sensitivity. The Capital Investment proposals gives the full details
of these variables and their degree of sensitivity.

APPLICATION OF RISK AND UNCERTAINTY ANALYSIS:


Analysis of risk and uncertainty as enumerated above is applicable to all capital
investment proposals.

However, sensitivity analysis are normally provided for projects costing less than Rs.
50 crore, unless sensitivity of any variable is very high.

FINANCIAL OBJECTIVE OF INDIAN OIL CORPORATION LIMITED

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• To ensure adequate return on the capital employed and maintain a reasonable annual
dividend on equity capital.
• To ensure maximum economy in expenditure.
• To manage and operate all facilities in an efficient manner so as to generate adequate
internal resources to meet revenue cost and requirements for project investment,
without budgetary support.
• To develop long-term corporate plans to provide for adequate growth of the
Corporation’s business.
• To reduce the cost of production of petroleum products by means of systematic cost
control measures and thereby sustain market leadership through cost competitiveness.
• To complete all planned projects within the scheduled time and approved cost.

SWOT ANALYSIS

A SWOT (Strength, Weakness, Opportunities, Threats) analysis is a tool to


provide a general or detailed snapshot of a company’s health.
In any business, it is imperative that the business be its own worst critic. A
SWOT analysis forces an objective analysis of a company’s position vis-a-vis its
competitors and the market place. Simultaneously, an effective SWOT analysis will
help to determine in which areas a company is succeeding, allowing it to allocate

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resources in such a way as to maintain any dominant positions it may have. Below are
numerous, current example SWOT analysis.

STRENGTHS
The most important strength of IOCL is its goodwill. Its other strengths can be:
• Extensive access to rural market.

• Extensive marketing channels.

• Proper quality-implementation of quality concepts like six-sigma, etc.

• World class Research & Development centre.

• Nearness to the market helps in sales.

• Largest pipeline network.

• Location of refineries near to exploration site.

WEAKNESS
• Government intervention.

• New to the upstream business.

• Dependence on exploration companies for crude oil.

• High cost of raw materials.

• No control over fluctuation in the international market.

OPPORTUNITIES

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• It can spread out its offshore marketing ventures to tap new markets and explore
business opportunities.

• It has entered into a new arena where it can thrive to be the market leader, as it is
already established as one in the refining sector.

THREATS
 Competition from domestic players as well as from established MNC’S.

 To keep up with the global markets, it has to invest huge amounts for quality
upgradation projects.

 The discovery of huge reserves on the eastern coast of South India will affect the
demand for liquid petroleum products of IOCL.

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CORPORATE MISSION:
1. To achieve international standards of excellence in petroleum Refining, marketing
and transportation with concern for customer satisfaction.
2. To create a modern technology base for self reliance, growth and development.
3. To contribute to the national economy by providing adequate return on investment
and setting high standard of leadership in productivity and total quality.
4. To foster a culture of participation and innovation and innovation for employee
growth and contribution.
5. To help enrich quality of life of community and preserve ecological balance and
national heritage.

FINDINGS

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 IOCL possess enough resources. The technology used in AOD hospital is also
upgraded from time to time.

 Indian Oil with Assam Oil as a supplementary brand will be able to create a larger
pool of royal customers.

 In the north zone, Assam Oil has immersed as a strong brand in the items of
royalty and perceived quality. Loyalty and perceived quality appear to be key
brand differentiators.s

SUGGESTIONS
 Steps have to be taken for increasing the communication between various
departments. That can boost coordination.

 More opportunities for career development of the employee have to come in the
picture and the management of IOCL (AOD) should give exposure to the new
generation.

 IOCL (AOD) should attempt to put proper man in the right job, for this skill
inventory can be used.

 Being market leader in the north east, it should try to defend its position the best
defensive strategy is the courage to attack itself by putting retail outlets with
modern look or by the re-modelling the old retail outlets with high sight potential
& high dealers capability.

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CONCLUSION:

With development in technology and infrastructure, Assam Oil Division is


moving towards attaining higher standards of excellence. With a name that has
existed for over 100 years, ready to meet the challenges of the future with its greatest
resource - a committed and talented workforce.

Assam Oil Division has always upheld its commitment towards the community
at large, as a good corporate citizen. It has been carrying out various developmental
activities in the region. In its journey forward it believes in carrying along with it, the
community with which it co-exists. Today with its modern technology and facilities,
Digboi Refinery produces major petroleum products like fuels, wax, bitumen and
range of specialty products. This hundred year old Digboi refinery can very well be
said a technical marvel of the past and present.

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BIBLIOGRAPHY

NAME OF THE BOOK NAME OF THE AUTHOR

 HUMAN RESOURCE MANAGEMENT: P. SUBBA RAO


 FINANCIAL MANAGEMENT: I M PANDEY
 PRODUCTION MANAGEMENT: GAGAN DEEP SHARMA
& MANDEEP MAHEDENDRU.
 MARKETING MANAGEMENT: PHILIP KOTLER

REPORT:-

 INDIAN OIL CORPORATION LIMITED - ANNUAL REPORT

WEBSITES:-

 www.iocl.com
 www.iocl.gov.in
 www.ioc.com

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