SUMMER PLACEMENT PROJECT

REPORT

AT

GENERAL MOTORS INDIA LTD

SUBMITTED BY:

Kingshuk DuttaRoll no: 23BBA Programme, Faculty of CommerceMaharaja Sayajirao University,Vadodara,Gujarat

Acknowledgements

It is the duty of the trainee to acquire maximum knowledge and to inculcate the necessary skills along with building a charismatic personality which will be an inseparable asset throughout the trainee’s life.

Since the commencement of my training at GMI Halol, I have encountered many people who have helped and guided me all the way. These people deserve a special mention and my project report will be incomplete without acknowledging them.

I would like to express my gratitude to General Motors India Pvt. Ltd for enhancing my knowledge of the various systems, processes and functions followed at GMI Halol. The key source of guidance was the HR Department with which I could relate my learning to what I have studied theoretically.

It would be dereliction of duty if I do not extend my sincerest thanks to Mr. Rakesh Mehta- General Manager HR for providing me with a golden opportunity to pursue my summer internship at GMI Halol. My project report will be incomplete without the invaluable support and guidance of Mr. Ranjan Kumar, Mr. A Perumal, Mr. W Venkatesh.

Their Constant presence kept me all the more motivated and eager to learn more and absorb the experience in order to make myself a better individual.

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Preface

Summer internships are a crucial aspect of a management student’s life. At the MSU BBA programme under the aegis of M.S University, Baroda, summer internships aim to give the students an opportunity to actually put their theoretical knowledge into practical use. Undergraduate students with no or minimal experience also get a chance to feel the processes, systems and functions at a corporate level. The students get an exposure to the workings of a corporate organization. This would further help the student to understand their level of creativity and assist them to choose a field in which they would like to pursue specialization in future.

In this report prepared by me on my summer internship at GMI Halol, I have presented my understanding of the working of an enterprise which is one of the major players in the automobile industry in India and the World.

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Entry of General Motors in India:

General Motors India Private Limited

Overview

General Motors India, incorporated in 1994 as a 50:50 joint venture company with the CK Birla Group of Companies, became a fully owned subsidiary of

3 major zones for Automobile Manufacturers in India

Kolkata

Halol

Maruti – SuzukiHonda

TelcoHM

VolvoToyotaAshok LeylandFordHyundaiMitsubishi – HMBMW

FiatM & MTelcoBajaj TempoDaimlerChryslerSkoda

Delhi

Pune Nashik

Chennai

Mumbai

Gurgaon

[ Tech Center, [ Tech Center, FSS Center ]FSS Center ]

[ Present Mfg Plant ][ Present Mfg Plant ]

[ Mktg Office ][ Mktg Office ]

Clusters - auto companies & component suppliers

Bangalore

Tatanagar

GMI has regional sales

offices at Mumbai, Kolkata and Chennai

Indore

[ New Greenfield Site][ New Greenfield Site]

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GM in 1999 when GMOC bought the remaining shares. The company was restructured in 1999 and was converted from a Public Limited company to a Private Limited company.

General Motors India is now a wholly-owned subsidiary of General Motors Corporation, the largest automaker in the world. It offers products under the Chevrolet brand in the country. Introduced in India in 2003, under the banner “For a special journey called life”, Chevrolet has emerged as one of the fastest growing brand names in India. Today, the Chevrolet brand clearly is established for quality, reliability, safety, innovation, value for money proposition, environment-friendliness and customer care.

GM India has expanded its dealership network to 95 sales points and over 110 service centers, so far. The network is still being expanded to cater to its recent entry into the mini-car segment with the Chevrolet Spark. In addition, two new parts distribution centers have also been set up in Maharashtra and Delhi to supplement the two existing centers in Gujarat and Tamil Nadu.

GM India is the pioneer in introducing several industry-first programmes including a centralized 24x7 call centre to attend to customer complaints and provide any information related to GM India’s products and services through just a local call to 3030-8080 from any landline or mobile phone in the country. Chevrolet also provides additional peace of mind to its customers with an industry-first assurance of fixed cost for 45,000 kilometers or three years on service and maintenance with a "Cost of Ownership" program. A customer can pay a predetermined, fixed amount while buying a Chevrolet product rest assured that if its maintenance costs exceed this predetermined amount, the difference will be reimbursed.

Other first programmes introduced by the company earlier included chauffeur training programmes, mobile road show caravans, the OK 5-Star pre-owned car program, and a best-in-class warranty of three-years/100,000 kilometers, service holidays and fuel economy rallies.

GM India presently produces the Chevrolet Optra Magnum (both petrol and diesel), the Chevrolet Tavera, the Chevrolet SRV, the Chevrolet Aveo, the Chevrolet Aveo U-VA and the Chevrolet Spark at its plant in Halol near Baroda, Gujarat.

The Chevrolet Aveo U-VA, Chevrolet Spark and Chevrolet Optra Magnum Diesel have all been rated best in class in their respective market segments

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against stiff competition by auto journalists across the country. The Tavera, Optra and Aveo-U-VA have, between them, won a number of automotive excellence awards since launch.

Facilities

GM India’s state-of-the-art plant at Halol near Baroda has received the ISO 9002:1994 Quality Management System certification in 1999 and was re-certified for ISO-9001: 2000 standards in April 2005. GM India also received the ISO 14001 certification for its Environment Management System in 2000, which was re-certified for ISO 14001:2004 standards in November 2005. GM India’s plant also received the prestigious 3 Leaves Award from the Centre for Science and Environment (CSE) for overall environmental performance in 2001-02. Besides, it has also bagged Quality Circle awards instituted by various state governments.

The capacity of Halol facility has been expanded to 85,000 units from 60,000 units in April 2007 to meet increased demand for Chevrolet vehicles. In the meantime, GM India’s second plant is situated at Talegaon, near Pune in Maharashtra. Envisaged with an initial annual production capacity of 140,000 vehicles, the plant commenced production by the last quarter of 2008.

GM India – Greenfield, Pune Overview

• Site area : 172 Acres• Start of Production : June 1996• Capacity : 85,000 units / year

(expansions underway)

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• Shifts : 2 shift, 5 days / week• Management systems : GM Global Manufacturing System

: ISO 9001 : ISO 14001

• Automation level : Medium

Company Profile

1928: GM enters India. Produces cars under the Chevrolet and Vauxhall

brands. It also produces Trucks under the Bedford brand.

1954: GM exits India due to unfavorable business climate. It produces

386,000 vehicles during this period.

1988: Hindustan Motors begin to manufacture Isuzu trucks at the Halol

plant. The plant is closed due to unfavorable exchange rate.

1993: GM re-enters India by entering into a 50:50 joint venture with

Hindustan motors at Halol.

1995: GM launches Astra under the Opel brand.

1999: GM acquires 100% stake in GM India.

2000: GM launches Corsa under the Opel brand.

2003: The Company launches Chevrolet brand in India with the launch of

Optra.

2003: The GM technical center was established at Bangalore.

2004: Launch of Chevrolet Tavera

2006: Launch of Chevrolet Aveo

2006:Launch of Chevrolet Optra-SRV

2006:Launch of Chevrolet Aveo-UVA

2007:Launch of Chevrolet Spark

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Overview of GENERAL MOTORS:

General Motors (GM) was founded on September 27, 1908, in Flint, Michigan, as a holding company for Buick, then controlled by William C. Durant. It acquired Oldsmobile later that year. In 1909 Durant brought in Cadillac, Elmore, Oakland (later known as Pontiac) and several others. In 1909, General Motors acquired the Reliance Motor Truck Company of Owosso, Michigan, and the Rapid Motor Vehicle Company of Pontiac, Michigan, the predecessors of GMC Truck. Durant lost control of GM in 1910 to a bankers' trust because of the large amount of debt taken on in its acquisitions coupled with a collapse in new vehicle sales. A few years later, Durant started the Chevrolet Motor car company and through this he secretly purchased a controlling interest in GM. Durant took back control of the company after one of the most dramatic proxy wars in American business history. Shortly after, he again lost control, this time for good, after the new vehicle market collapsed. Alfred Sloan was picked to take charge of the corporation and led it to its post war global dominance. This unprecedented growth of GM would last into the early 1980s when it employed 349,000 workers and 150 assembly plants.

A joint venture (often abbreviated JV) is an entity formed between two or more parties to undertake economic activity together. The parties agree to create a new entity by both contributing equity, and they then share in the revenues, expenses, and control of the enterprise. This is in contrast to a strategic alliance, which involves no equity stake by the participants, and is a much less rigid arrangement.The phrase generally refers to the purpose of the entity and not to a type of entity. Therefore, a joint venture may be a corporation, limited liability company, partnership or other legal structure, depending on a number of considerations such as tax and tort liability.

Reasons

1. Build on company's strengths 2. Spreading costs and risks 3. Improving access to financial resources 4. Economies of scale and advantages of size

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5. Access to new technologies and customers 6. Access to innovative managerial practices

Competitive goals

1. Influencing structural evolution of the industry 2. Pre-empting competition 3. Defensive response to blurring industry boundaries 4. Creation of stronger competitive units 5. Speed to market 6. Improved agility

Strategic goals

1. Synergies 2. Transfer of technology/skills 3. Diversification

GM status as of now

GM is asking for $22.5 to $30 billion in loans, depending on how quickly the economy recovers. They expect to begin repaying the loans in 2012 and fully repay them by 2017. This amount breaks down like this:

$18.0 billion (Original request on Dec. 2, 2008, for a downside scenario, which is where industry volume is now tracking)

4.5 billion (Additional loan amount requested on Feb. 17 to cover an existing revolving line of credit that rolls over in 2011)

7.5 billion (Additional line of credit that may be needed if industry sales volumes deteriorate further, to 9.5 million units in 2009 and 11.5 million in 2010)

GM India is confident of achieving 20% growth in car sales compared to last year in spite of the recession and the growing interest rates. This is against the general Industry growth rate of 7%.  GM targets to produce 80, 000 vehicles this year and even it falls short by even 10,000 it would still be 20% more than last years production According to General Motors India Vice-President, Mr. P. Balendran, the market share of GM cars in Indian market would grow to 10 % by 2010 from the current market share of 4%.

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GM sources about $300 million worth auto components from India for their plants across the world. Talks are on with their suppliers to reduce the cost as the sourcing volume is goring to grow to $ 1 billion per year in next two years.

GMs Spark car is produced at the Talegaon factory in Maharashtra. This plant is set up at a cost of $300 million.

THE SCENARIO IN INDIA FROM 1992 TO 2000

In anticipation of rapid growth, the passenger car market in India is crowded with 18 companies trying to establish themselves. Most companies have joint ventures with Indian partners and have entered the market in the last two years. The number of new entrants over a narrow time window of two years is unprecedented.

Demand forecasts vary and analysts expect anywhere between 2 and 3.5 million cars to be sold in the next five years. Equity holding for the international partner is usually over 50% and they retain significant managerial control. Most of them have introduced cars in the $13,500 to $33,000 price range, which is viewed as a luxury segment in India. Automobile companies have also chosen to establish exclusive dealerships. Initially, companies have chosen to import completely knocked down (CKD) kits and assemble them in India.

However, this strategy is not effective in the long run since such imports attract 50% duty. The major implications are that a shake out is likely and that companies would need to have alternate plans, including introduction of cars in other market segments, lower prices, and exports from India if they cannot establish themselves in the domestic market. The supplier industry is very small and needs to develop simultaneously on all fronts including rapid capacity expansion, acquisition of technology, improvement in manufacturing practices, quality and productivity, adoption of lean manufacturing, and developing product design capabilities to meet the needs of assemblers. Therefore, a critical requirement for rapid growth of the industry is adequate assembler involvement in the suppler industry.

The Government of India's new automobile policy announced in June 1993 attracted a large number of automobile companies to India. These include General Motors and Ford, and three Japanese, six European and two Korean companies. Chrysler was also seeking to enter the country with a suitable Indian partner. In addition, there are three existing Indian companies, Hindustan

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Motors, Premier Automobiles and Telco, and one Indo-Japanese venture, Maruti already in the passenger car market. Maruti is by far the biggest player with about 70% of the market share.

The number of new entrants and the level of investment within a very narrow time window of two to three years are unprecedented and seems unique to India. Compared to three major models available in the Indian market until recently, customers can now choose from a wide variety of products.

Some of the entry barriers faced by automobile companies in India are relatively high levels of import duties, a nascent ancillary industry, and product modifications required for relatively poor road conditions and high levels of heat and dust. On the other hand, a rapidly growing middle class, rising per capita income, and high levels of latent unsatisfied demand with customers starved of world class options promise enormous opportunities. For instance, from current sales of around 300,000 passenger cars in 1996-97, sales are expected to rise to anywhere between 850,000 to 1.7 million vehicles by the year 2000. Automobile companies have announced plans to install capacity of around 900,000 vehicles by the year 2000.

The number of cars sold over the next four years is going to be anywhere between 2 and 3.5 million vehicles.It is not certain how exactly demand will grow and on what factors it will depend, and whether there is room for so many players. The supplier industry also faces enormous challenges to keep pace with rapid growth. Manufacturing practices will have to change considerably to come closer to lean production. It is also possible that some companies will increasingly use India as a base for exporting vehicles to other countries. These issues will become clear as the future unfolds. At this stage, we describe and analyze the entry strategies of multinational companies in the Indian automobile industry.

Entry Strategies prevalent during 1990s:

Entry strategy for international markets is a comprehensive plan, which sets forth the objectives, goals, resources, and policies that will guide a company's international business

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Operations over a future period long enough to achieve sustainable growth in world markets

For a company, each product in each foreign market has a different entry strategy. The corporate international entry strategy is a combination of the different entry strategies of its various products in various foreign markets. There are various elements of entry strategy. In this paper, we have considered the following elements:

o choice of product - choice of target market - choice of an entry mode to penetrate the target country - timing of entry

o magnitude of investment and area of competitive emphasiso marketing plan to penetrate the target marketo control system to monitor performance in the target marketo A close look at the entry strategies of the multinational companies

in the Indian automobile industry points to some distinct patterns. Except for Audi, which is targeting a premium market niche, and Hyundai, the rest of the companies have set up joint ventures with Indian partners. Audi has announced plans for franchising automobiles. Recently, Hyundai has announced plans to enter the country with a wholly owned subsidiary. For most of the new joint ventures, management control lies with the MNCs. For example, though General Motors India is a 50:50 joint venture of GM and Hindustan Motors, ten International Service Personnel from Opel form the entire top management team of General Motors India. Similarly, Daewoo in DCM Daewoo Motors, Ford in Mahindra Ford, Mercedes in Mercedes Benz India Limited, Honda in Honda Siel, and Volkswagen in Eicher Volkswagen exercise significant management control. All these companies have expatriate managers in top positions.

Implications:

There were 18 automobile companies jostling for a market whose size by the most optimistic estimates is around 1.7 million vehicles per year by the year 2000. Clearly, sufficient room for so many players was not there. This means

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companies will need to have clear strategies on what they will do if they are not able to establish a viable market presence. One alternative is to use India as a manufacturing base to supply cars to other countries in South East Asia, Middle East and perhaps the Eastern block countries.

The other major implication is that automobile companies need to pay attention to the development of the supplier industry. Rapid growth in assemblers' capacity is possible only if suppliers are able to keep pace with them. The strategy used by Suzuki in 1980 of facilitating joint ventures between its major suppliers in Japan and some Indian companies was a good one.

However, the supplier industry needs to grow, acquire new technology, improve manufacturing practices, quality and productivity, and restructure itself into first, second and third tier companies. There is also a lot of pressure on suppliers from assemblers to acquire product design capabilities. Simultaneous, fast development on so many fronts is possible provided assemblers facilitate the process. Automobile companies may also need to rethink their strategy of introducing models successful in developed economies into India.

GM Operations in present times:

“An Integrated Management System is a single integrated structure used by an organization to manage its processes – or activities – that transform inputs of resources into a product or service which meet the organization’s objectives and equitably satisfy the stakeholders quality, health, safety, environmental, security, ethical or any other identified requirement.”

Principle characterstics of an IMS system :

A true IMS will typically have the following characteristics:

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1. Its scope will cover the totality of the organization’s processes and systems and embrace health, safety, environment, security, human resource, finance, marketing, public relations, etc. as relevant to the organization’s values, operations and objectives.

2. It is formally defined in a uniform style that only varies where necessary to meet its purpose e.g. description of broad principles as opposed to a defined sequence of steps to be followed in a process.

3. While ensuring the effectiveness of the IMS, replication of documentation is minimised through a minimalist approach.

4. The structure does not slavishly follow that of a specific management standard or item of legislation but is designed to control and guide the organization’s processes in the most effective and efficient way.

5. Each component of the management system takes account of all of the other components as appropriate.

6. It transparently addresses all relevant stakeholder key requirements defined via relelevant standards, legislation or other defined requirements.

Typical features of an IMS:

An IMS needs to be structred to enable the organization to effectively and efficiently manage its processes and will depend on its’ size, number and complexity of products and services, degree that it is regulated, national or multinational nature, etc. The following features would be typically observed in an IMS:

1. Single Policy Statement covering all relevant issues. This may include subsections addressing specific topics.

2. Notwithstanding any specific stakeholder requirements such as licensing and regulation, there is a single Management Manual describing the formal management arrangements.

3. Organization, responsibilities and authorities are defined such that the job descriptiopn for any given post or individual is concise, clear and complete.

4. The totality of the control of people issues, such as competency and project employment life-cyclces, is defined in an integrated way and promotes integrated processes.

5. Process controls are developed such that opportunity and all aspects of risk are simultaneouly addressed.

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6. Notwithstanding any specific stakeholder requirements such as licensing and regulatuion, management control at company and project level are defined in a single coherent set of documentation such as generic plans, procedures, work instructions and forms e.g. an incident reporting form would cover any issue such as complaint, personnel or environmental accident, etc.

7. Reactive Monitoring (customer feedback, accidents, and incidents etc) managed via a single integrated process. The resulting analysis would cover all issues in an integrated way.

8. Proactive Monitoring (audits, inspections, surveys, benchmarking etc) are managed together in a coherent way to effectively and efficiently opitimize the management system, and the organization’s processes.

9. All types of change are managed through the same formal processes.10.The Management Review process covers all the aspects of the operation

of the organization and shorter term review cycles are logically embedded into longer term review cycles to form an integrated hierarchy of management review processes apporpriate to the size and complexity of the organizaion.

11.Tendency to use generic management tools and approaches for systems and process ananalysis to identify opportunity and hazards and assess risks.

Fostering Global Partnerships and Consumer Relationships:

GM is the major shareholder in GM Daewoo Auto & Technology Co. of South Korea, and has product, powertrain and purchasing collaboration with Suzuki

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Motors Corp. & Isuzu Motors Ltd. Of Japan. It also has advanced technological collaborations with DaimlerChrysler AG and BMW AG of Germany and Toyota Motor Corp. of Japan. It has Vehicle manufacturing ventures with several established automakers in the world such as Toyota, Suzuki, Shanghai Automotive Industry Corp. (SAIC), AVTOVAZ of Russia and Renault of France.

The Global Reach of GM Parts & Accessories:

Genuine GM parts and accessories are sold under the GM, GM goodwrench, GM performance and AC Delco Brands through GM Service & Parts Operation, which supplies Dealerships and Distribution worldwide. The GM engines and Transmissions are marketed through GM Powertrain.

IMS Policy:

We at General Motors India are committed to become a successful company by providing vehicles and offering services which are best-in-class and continually improve to exceed customers’ expectations and organization’s environmental performance while complying with all applicable, legal, safety and other requirements.

GM's Vision :

GM's vision is to be the world leader in transportation products and related services. GM earns customers' enthusiasm through continuous improvement driven by the integrity, teamwork and innovation of GM people.

Mission:

To profitably sell 200000 vehicles in 2010, achieve top 3 ranking in JD power and be amongst the 50 most admired companies in India.

Core Values:

Core values are what Company stands for, and are shared by everyone throughout the organization.

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1. Customer Enthusiasm GM dedicates themselves to products and services that create enthusiastic customers. No one will be second guessed for doing the right thing for the customer.

2. Integrity

GM stands for honesty and trust in everything we do. They believe and do what we say.

3. TeamworkGM wins by thinking and acting together as one General Motors team, focused on global leadership. Their strengths are highly skilled people and diversity.

4. Innovation GM challenge conventional thinking, explore new technology and implement new ideas regardless of their source faster than their competition.

5. Continuous Improvement GM set ambitious goals, stretch to meet them, and then "raise the bar" again and again. They believe that everything can be done better, faster and more effectively in a learning environment.

6. Individual Respect and Responsibility GM respect others and act responsibly, so that they can work together to meet the common goals. 

Cultural Priorities:

Enhance Product and Customer Focus

Focuses on the customer: links customer needs and wants to innovation and product development

Integrates across functions to address customer needs Embraces excellence and innovation: Leads efforts to create value-added

products and services Supports initiatives focused on "designing, building, and selling"

excellent products and services to customers Questions conventional thinking on products and services.

Act As One Company

Collaborates proactively on global issues and drives for team success Encourages teamwork

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Leverages ideas, concepts, products, and processes for GM units around the world

Leads teams effectively within and across organizations/borders Encourages others to look beyond individual organizations and focus on

GM's success Stimulates external and internal exploration, benchmarking, and learning Understands customers, markets, and competitors, and focuses on

customer requirements and customer enthusiasm

Embrace Stretch Targets

Sets and deploys high-impact, stretch goals and objectives focused on making GM the best

Makes stretch "the very best we can do" -- 1 in 10 -- benchmark performance

Understands, measures, and manages intelligent risks Motivates, stimulates, and supports efforts to deliver results that achieve

competitive advantage Monitors, evaluates, coaches, and rewards based on performance and

results that really make a difference

Move with a Sense of Urgency

Communicates a compelling and inspired vision for change; champions fast implementation of leading-edge changes

Eliminates bureaucracy and slowness; seizes opportunities, not fearful of responding or reacting with minimal planning

Ensures that speed and cycle times are understood, measured and improved

Inspires and leads employees and teams to pursue Go-Fast! opportunities; shares ownership and implementation responsibilities

Drives self and others for results; makes employee feel his/her work is important

Is decisive and empowers others to make decisions based on performance and integrity

Business Strategy

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Introduce great cars and trucks ("gotta-have" products)

Be aggressive in the market place Reduce costs and improve quality Generate cash

BUSINESS AREAS OF GM:

GMC - Corporate Affairs (Detroit)

NAO - North America Operations

Vehicle Sales, Service, & Marketing Group - Warren Michigan, Midsize and Luxury Car Group - Los Angeles, California + Mexico & Canada sales offices

LAO - Latin America Operations

Brazil, Argentina

GME - General Motors Europe

Poland, Germany, Egypt, South Africa, Hungary, Czech Republic

APO - Asia Pacific Operations

Indonesia, Japan, China & Hong Kong, Philippines,

India, Australia,Malaysia, South Korea, Thailand

ARMS OF GM:

Electro Motive Division (EMD)

Allison Transmission Division (ALLISON)

Hughes Electronic Corporation (HUGHES)

General Motor’s International Operation (GMIO)

General Motors Acceptance Corporation (GMAC)

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CORPORATE AFFAIRS:

GM has a significant stake in the Suzuki Motor Corporation of Japan. It will soon phase out Oldsmobile brand line of vehicles oldest in America. General Motors has been the No. 1 Company in the Fortune magazine’s worldwide ratings; currently it is ranked at No. 3. It has been leading the automobile sector for many years, although the competitors are gradually closing in. Ford Motor Company (currently ranked 4th in the Fortune list) and the Toyota Motors are its nearest competitors.

The General Motors Group worldwide consists of the various newly acquired /partly acquired/ fully owned subsidiaries.

Fiat Auto Spa (20% market share)

Fuji Heavy Industries Ltd.

Isuzu motors Ltd.

Suzuki Motors Corp.

Daewoo Auto & Technology Co (DAT)-now known as GM-DAT

GENERAL MOTORS PRODUCTS:

GM (General Motors) is best known as the world’s largest full-line vehicle manufacturer. As a leader in the transportation business GM has products catering to about every transportation need. These products include:

Cars, trucks, vans, buses and sport utilities Locomotives, diesel engines, and gas turbines Heavy duty automatic transmissions Defense equipment Financial products Information management and communication

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BRANDS ASSOCIATED WITH GM:

GM is the majority shareholder in GM Daewoo Auto & Technology Co. of South Korea, and has product, powertrain and purchasing collaborations with Suzuki Motor Corp. and Isuzu Motors Ltd. of Japan. GM also has advanced technology collaborations with DaimlerChrysler AG and BMW AG of Germany and Toyota Motor Corp. of Japan , and vehicle manufacturing ventures with several automakers around the world, including Toyota, Suzuki, Shanghai Automotive Industry Corp. of China, AVTOVAZ of Russia and Renault SA of France.GM’s automotive brands are Buick, Cadillac, Chevrolet, GMC, Holden, HUMMER, Opel, Pontiac, Saab, Saturn and Vauxhall. In some countries, the GM Group distribution network also markets vehicles manufactured by GM Daewoo, Isuzu and Suzuki.

Genuine GM Parts and accessories are sold under the GM, GM Goodwrench and ACDelco brands through GM Service and Parts Operations through GM dealerships and distributors worldwide. GM engines and transmissions are marketed through GM Power train.

GM operates one of the world’s leading financial services companies, GMAC Financial Services, which offers automotive and commercial financing along

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with an array of mortgage and insurance products. GM’s OnStar is the industry leader in vehicle safety, security and information services.GM’s largest national market is the United States, followed by China, Canada, the United Kingdom and Germany.

MAJOR DEPARTMENTS AT GMI:

1. MANUFACTURING2. BODY SHOP3. PAINT SHOP4. ASSEMBLY SHOP5. PURCHASE6. FINANCE7. PRODUCT ENGINEERING8. NEW BUSINESS DEVELOPMENT9. QUALITY10.MAINTENANCE DEPARTMENT11.HUMAN RESOURCE12.MARKETING

Responsibilities of the Major Departments at GM:

A) MANUFACTURING

It is responsible for assembling various components of the car to make the final product. Manufacturing department consists of the body shop, where the sheet metal parts are all assembled and the basic BIW (Body In White) structure of the body is made; paint shop, where the body and its assembly parts are chemically treated and painted; and finally Trim Line where the vehicle is equipped with its various components, including chassis, engine, wheels, seats, suspensions, etc.

The GMI manufacturing has in it three major shops as follows:

A.1 BODY SHOPMajor activity carried out in body shop is the welding of all the press components and assembling it to form the car body as per specified model. The maintenance team 1 is responsible for this area. This team is split into two groups which work alternatively in A and B shifts under leadership of team leader and assistant team leader respectively. Major equipments in this area are Weld Transformers, Weld Guns, Fixtures, Sealer Pumps, Stud welders, Projection welders, Mig welders, etc.

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A.2 PAINT SHOPThe paint shop is further divided into Body Paint shop and Plastic paint shop. The output from the Body shop comes to the Body paint shop and after the paint job is completed, the painted car body is transferred to the Assembly shop for final assembly.Major areas or booths in Paint Shop are Pre Treatment plant, electro dip plant, electro coat oven, spray booths, prima and topcoat oven, paint shop ventilators, body-carrying trucks, PT-Elpo conveyors and spray-booth/oven conveyors. The Plastic parts like Bumpers are painted in the Plastic Paint shop and once the paint job is completed it is send to the Assembly line for final assembly. The Major equipments in the plastic paint shop are Flaming Zone, Spray Booth and Humidifier; Sludge handling system, Oven and plant ventilation. Maintenance Team 4 is responsible for this area.

A.3 ASSEMBLY SHOPThis is the last activity of the Production where the car is completely assembled. The major areas in the Assembly shop are Trim Line, Chassis Line, Car Final and Final Process. Currently two lines are running parallel to each other. One is T&J line producing Optra, Aveo, UVA and Spark under the brand name of Chevrolet & second one is I-163 line producing Tavera under the brand name of Chevrolet.

B) PURCHASEThis is the largest department in GMI in terms of resources. This Department is mainly responsible for procuring all the components of the car at reasonable prices from potential auto part manufacturers. Supplier Quality Assurance (SQA) looks after the quality issues relating to the parts supplied by the supplier and checks the parts quality before accepting it from the supplier. This checking is done to verify whether the supplier has performed all the tests according to the specifications given by GMI, and dimensions and tolerance and even part functionality is checked. Finally, the required documents should be completed. Material, Planning and Control (MPC) looks after the handling of material into the company, stores in inventory and decides how much to be ordered as per daily requirement

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C) FINANCEFinance Department looks after all the monetary transactions and is responsible for budgeting.

D) PRODUCT ENGINEERINGThis department is responsible for initiating the localization process like releasing the required documents, specifications and drawings. After this, the Lead Product Engineers are required to attend technical reviews along with the Purchase Dept. In addition, choose the supplier(s) for a particular part. This department does not involve in designing of the parts as mainly the designs are reproduced from Isuzu and GMDAT drawings. However, it tries to account for the value-engineering proposals i.e. VA/VE (Value Analysis/Value Engineering) put forward by the employees in order to improve the product efficiency. The product engineers constantly work towards taking care of the field issues and incorporating location specific features into the vehicles.

E) NEW BUSINESS DEVELOPMENTThis department plays a major role in suggesting new projects, leads the Product Planning Task Force Team, then issues the Product Change Notification and in a way is the heart of the company.

F) QUALITYQuality department ensures the best quality to be delivered to the customers. Quality department audits vehicles right from body shop until final buyoff of the vehicle. This department has Global Customer Audit area (GCA) where the vehicle is being inspected for quality, manufacturing and engineering related faults in front of their respective dept. director and vice-president. The faults are noted down in a book and respective actions are then taken.

G) MAINTENANCE DEPARTMENTThe maintenance department at General Motors India has a lot of responsibilities to be taken care of. We had an overview of Strategic Asset Management and its implementation in GMI. Let us have a brief overview of the responsibilities of the maintenance department.

H) HUMAN RESOURCE

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This department is responsible for the company’s image and makeover. It takes care of recruitments that occur. Security too comes under the purview of this department. Employee satisfaction is its major agenda. Moreover, the training of company employees is done by the HR dept. every month the training is organized to teach employees the GMS (Global Manufacturing System). Simultaneously, the training about safety and rules, working ergonomically and other new systems is given to the employees to make them more competitive.

I) MARKETING

The marketing department is located at Gurgaon (Haryana) & Halol and is responsible for vehicle sales and distribution. Also market forecasting, product features, variant suggestions and demand & supply analysis is carried out by Marketing. Based on the demand & supply data by marketing department the production planning is carried out so that there remains a balance between demand & supply, thus inventory control is achieved.

The marketing activities relate to identifying the needs of the target customers (end user) and converting them into potential opportunities for GMI. It also is responsible for gauging the sentiments of the GMI present customers as regard to their vehicle performance and the services rendered to them by GMI retailers. This is done through an extensive survey carried out periodically by an external agency. The formats are frozen by GM Asia Pacific operations are cannot be modified by any business unit as they are in line with regional objectives of GMC. It helps in taking necessary corrective action and increasing the confidence of the GMI customers in the product.

The selling activity is initiated at the Retailer level. The Retailer is the key in product promotion, product sales and providing after sales support for GMI products.As such the Retailer selection and appointment forms one of the most important activities to ensure overall support to the customer and customer enthusiasm. Retailers are continuously evaluated on the requisite criterion to meet company objectives.

Another important activity is to provide a correct and timely forecast for possible sales of various models in the GMI range. It helps the production team to plan, produce and supply the vehicles accordingly. This also ensures that the customer’s requirements are met and GMI maintains a competitive presence in the market.

25

The vehicles are sold through the retailer network. The vehicles need periodic care and attention while they are used by the customers (end users).

After sales activities provide the necessary support to the customers through the retailer network by providing guidelines for work, receiving and resolving customer complaints, taking product feedback for corrective action, expanding its network and providing warranty to the customers as per the warranty terms.The retailers are provided with a copy of after sales operational manual, this serves as a general guideline for regular operations.

The respective Department will identify their training needs & send to training coordinator at Delhi who will compile and forward to HR Dept. The records are available with Training Coordinator.

The Distribution department specifically is a support function to the Sales and After sales departments. It executes the orders placed by the retailers for vehicles for onward delivery to the customers (end users). It is also responsible for coordinating the market requirements with the manufacturing team for supply.

The parts distribution department also caters to procurement and distribution of spare parts for the GMI range of vehicles. This includes ordering & receiving of parts from vendors & receiving and executing orders from retailers. It incorporates all the functions of a warehouse and its related activities.

PURPOSE: Carry’s out Marketing and support activities as relative to GMI

‘s present and future range of vehicles.

Selling the GMI range of vehicles through an extensive retailer network throughout the country and in selected export markets.

Provides supporting & guiding into the areas of operation of after sales activities in context to vehicles sold by GMI.

Ensure that all the activities are carried out in an environmentally friendly manner.

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Page 8/35

GM India Organization Chart

Ankush AroraVP – VSSM

Anthony C Bates General Counsel

Sunil RekhiVP Finance

Karl SlymPresident & MD

Yash YadavVP - HR

Manish PatelVP - IS&S

Vempati SastryDirector – PPPM

M VenkatramVP - GPSC

Rakesh Sabbarwal Dir.-Mfg, Talegaon

P BalendranVP Corp. Affairs

Dr B G PrakashDirector – R&D

Sheila SarvarVP - Engineering

Prashant SwadiaDirector – SFO

Vijay KalraVP – Mfg, Halol

27

Human Resources

Department

28

This department is responsible for the company’s image and makeover. It takes care of recruitments that occur. Security too comes under the purview of this department. Employee satisfaction is its major agenda. Moreover, the training of company employees is done by the HR dept. every month the training is organized to teach employees the GMS (Global Manufacturing System). Simultaneously, the training about safety and rules, working ergonomically and other new systems is given to the employees to make them more competitive. The spectrum oh HR activities in General motors are as follows. But there are five main important Aspects of HR department at GM.

They are as follows:-1. Recruitment and selection 2. Training and development 3. Employee relation4. Welfare5. General affairs and security.

Rakesh MehtaGeneral Manager - HR

Nachiket UpadhyayDy Manager- HR

DeepakER Assistant

GR ArunAsst. Manager - HR

Chirag Vaishnav Sr Executive - Admin

Gaurang Pandya

Sr Executive - Admn

Yeshwinder PatialDy Manager-HR

Staffing

Niraj ChaturvediManager-General Affairs

Rajiv VermaAdmin Assistant

Krunal PatelDy Manager – HR

HRIT

Ranjan KumarDy Manager – HR

Training & Dev.

Sanjeev DumasiaSr. Executive - HR

Sailesh KumarAsst. Manager – HR

Payroll & Benefits

RandhirEmp. Benefits

Bhavesh Emp. Attn. & Leave

GM India, Halol - Human Resources Organization Chart

Yash YadavVice President - HR

BrijeshHRIT Support

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1. RECRUITMENT AND SELECTION:

MAN POWER PLANNING:-

PURPOSE: Manpower planning enables a department to project its short to long term needs on the basis of its departmental plans so that it can adjust its manpower requirements to meet changing priorities. The more changing the environment the department is in, the more the department needs manpower planning to show:

the number of recruits required in a specified timeframe and the availability of talent

early indications of potential recruitment or retention difficulties surpluses or deficiencies in certain ranks or grades availability of suitable qualified and experienced successors

Key elements of Man Power Planning also include Successive Planning.

PROCESS: Steps of Man Power Planning in GMI: Coming Year (2008) business plans and budgets are been decided by the

GM’s global head which is situated in Detroit. Once it is been planned and decided it goes to the head of various plants

(GMI- Halol) by the month of September-October 2007. The entire plans is been discussed to the Staff Head. Accordingly the number of employees required in an organization along

with their experience, job description is been given to the HR Department. It goes for the approval to the HR Head and for the senior level position

even Managing Directors approval is required. Once the confirmation is made recruitment coordinators would try to find

out the source i.e. internal (promotion, up gradation) and external (from data base, advertisement, e-recruitment, etc).

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SELECTION PROCESS:-

(A)For internal promotion (Level 2PA to Level 3PB)(B)Temporary Assignees

(C)Exit Interviews

PURPOSE:

The Recruitment and Selection process promotes successful hiring decisions that can truly impact the success of a department or faculty.

The selection of a candidate with the right combination of education, work experience, attitude, and creativity will not only increase the quality and stability of the workforce, it will also play a large role in bringing management strategies and planning to fruition.

PROCESS:(A)For internal promotion (Level 2PA to Level 3B ) Approximate 8 to 10 people had applied for interview for “Team Leader

Position” in various area in the shop floor I took part in the interview as a silent observant

INDUCTION:-

PURPOSE:

The purpose of induction is to ensure the successful implementation of a uniform procedure for introducing new employees and help our new employees feel part of the organization by providing information and assistance at the time it’s needed.

It is important that the induction process is consistent to ensure that all new employees have the same induction experience and receive the same messages. Induction if implemented effectively has the potential to reduce turnover, absenteeism and boost morale.

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PROCESS:

Once in a month induction takes place. Either its on the first week of every month or on the last week of every month

Induction goes for minimum 3 days for staff level.

Movement the newly recruited employee has joint the company training department gets the intimation and a schedule is prepared for newly joint recruitees’ induction.

It is a role of an HR professional to see to it that induction is properly carried out and is been practiced in the right manner.

After induction process is completed a small multiple choice questions test is conducted which will help the HR department to get the feed back and also for the audit purpose.

2. TRAINING AND DEVELOPMENT:-

PURPOSE:

The basis purpose or believes of GMI is upgrading the skills and knowledge of its HR through comprehensive training to enable them to efficiently perform their duties according to the GMI standards.

PROCESS: On Job Training (OJT)

1. Training Need Identification

Off the Job Training

1. Compilation and review of identified training needs

Computer Base Training

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2. Training Execution In house Training

External Training

4. Training Evaluation Steps:-

Off the Job Evaluation On the Job Evaluation

~ Pre/Post Training Test ~ it is designed and taken by Department~ Post Training Skills Test Training Coordinator (DTC)~ Short Term Evaluation~ Long Term Evaluation

5. Corrective Action Procedure:- ~ Counseling with trainee by some trainer for better understanding of key Issues. ~ Imparting training again (retraining) by same/new trainer ~ Supporting trainee for self learning approach (providing books, articles, news Papers cuttings, Cd’s, Videos, etc to read and understand).

6. Extra:

~ Training Coordinator maintains training records other then OJT ~ Training records are preserved for 2 years after the employees’ separation ~ HR department maintains records related to education qualification and Experience of each employee.

Coordinating 2 major Training Programmes:-

1. Communication & Presentation Skills of assistant team leaders (ATL) – Mr. Ranjan Kumar.

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2. Communication & Presentation Skills of team leaders – Mr. Ranjan Kumar.

The Kirkpatrick's Four Level Model of Training Evaluation:-

The "Kirkpatrick Model" is the most widely used approach for evaluating the effectiveness of training in the corporate, government, and academic worlds. It was developed (and subsequently refined) by Donald L. Kirkpatrick, professor of education at the University of Wisconsin and former president of the American Society for Training and Development (ASTD).

Kirkpatrick’s Four Levels of Evaluation are:

• Measuring REACTION: Getting feedback from participants describing how

they felt about the various aspects of the program.

• Measuring LEARNING: Quantifying the learning that took place by

measuring increased knowledge, improved skills, and/or changes in

attitudes.

• Measuring BEHAVIOR: Gauging changes in behaviour that result from the training program.

• Measuring RESULTS: Determining the final results which have come about because of the training program.

The model is a useful tool -- but one that is oftentimes difficult to implement. It is deceptively simple. Kirkpatrick's categories for evaluation seem almost obvious on first approach, but when an evaluator attempts to implement them in a real context it is easy to become mired down in detail or factors that are difficult to identify or measure. As a result, many organizations find themselves implementing the lower levels of the model, and don't attempt the higher levels. For example, trainers and training departments typically conduct Level 1 and Level 2 evaluations of their training programmes. Level 1 evaluation might consist of gathering feedback from learners or having them fill out a survey. Level 2 evaluations can be conducted through delivering pre-tests to learners before they take the training and post-tests after they have completed it. Measuring Level 3, which involves assessing how the learner's behaviour has changed, is more complex and difficult. Finally, measuring Level 4 -- which some have interpreted as a financial evaluation (measuring the company's return

34

on investment (ROI) in relation to the training programme) -- can be a very complex process. The main point to keep in mind about the Kirkpatrick Model is that it is not a rigid set of measurements that can be universally applied to any learning programme to evaluate its effectiveness. Instead, it is a set of flexible guidelines that should be used to help design and implement effective and appropriate evaluation and assessment strategies.

The Kirkpatrick's Four Levels of Evaluation are as follow:-

Level 1 – Reaction How did participants react to the program? Level 2 – Learning To what extent did participants improve knowledge and skills and change attitudes as a result of the training? Level 3 – Behavior To what extent did participants change their behavior back in the workplace as a result of the training? Level 4 – Results What organizational benefits resulted from the training? The content or the data sources which will help in understanding and designing each level are as follow:

Level 1 (Reaction)

completed participant feedback questionnaire

informal comments from participants

focus group sessions with participants

Level 2 (Learning)

pre- and post-test scores

on-the-job assessments

supervisor reports

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Level 3 (Behavior)

completed self-assessment questionnaire

on-the-job observation

reports from customers, peers and participant’s manager

Level 4 (Results)

financial reports

quality inspections

interview with sales manager

Performance appraisal:

Performance appraisal, also known as employee appraisal, is a method by which the job performance of an employee is evaluated (generally in terms of quality, quantity, cost and time). Performance appraisal is a part of career development.

Performance appraisals are regular reviews of employee performance within organizations

Generally, the aims of a performance appraisal are to:

Give feedback on performance to employees. Identify employee training needs. Document criteria used to allocate organizational rewards. Form a basis for personnel decisions: salary increases, promotions,

disciplinary actions, etc. Provide the opportunity for organizational diagnosis and development. Facilitate communication between employee and administraton Validate selection techniques and human resource policies to meet

federal Equal Employment Opportunity requirements.

A common approach to assessing performance is to use a numerical or scalar rating system whereby managers are asked to score an individual against a

36

number of objectives/attributes. In some companies, employees receive assessments from their manager, peers, subordinates and customers while also performing a self assessment. This is known as 360° appraisal. forms good communication patterns

The most popular methods that are being used as performance appraisal process are:

Management by objectives 360 degree appraisal Behavioral Observation Scale Behaviorally Anchored Rating Scale

Trait based systems, which rely on factors such as integrity and conscientiousness, are also commonly used by businesses. The scientific literature on the subject provides evidence that assessing employees on factors such as these should be avoided. The reasons for this are two-fold:

1) Because trait based systems are by definition based on personality traits, they make it difficult for a manager to provide feedback that can cause positive change in employee performance. This is caused by the fact that personality dimensions are for the most part static, and while an employee can change a specific behavior they cannot change their personality. For example, a person who lacks integrity may stop lying to a manager because they have been caught, but they still have low integrity and are likely to lie again when the threat of being caught is gone.

2) Trait based systems, because they are vague, are more easily influenced by office politics, causing them to be less reliable as a source of information on an employee's true performance. The vagueness of these instruments allows managers to fill them out based on who they want to/feel should get a raise, rather than basing scores on specific behaviors employees should/should not be engaging in. These systems are also more likely to leave a company open to discrimination claims because a manager can make biased decisions without having to back them up with specific behavioral information.

In the PTF Report it was claimed that “although annual Reports by ministries and departments are obligatory, they are hardly ever prepared and submitted to government, and where they, they are scanty and hardly confirms with any standards, either in terms of contents or format. The recommendation was that

37

there should be target setting by ministries where concrete and measurable achievement can be inferred

THE PROCESS OF APPRAISAL:

38

EMPLOYEE RELATIONS:-

Employee Communication Channels:-

Diagonal Slice Meeting (DSM): This is a forum for informal discussions between the leadership of the plant & the employees. This provides a platform to the plant leadership to get direct feedback from the employees. Alternatively, it provides an opportunity to the employees to share ideas & concerns & to seek clarifications on the various issues. This meeting is held once in a month (Based on the availability of MD). All those employees whose Birthday fall in that month are invited to participate in the DSM. President & Managing Director chairs this meeting.

Business Condition Sharing Meeting: This is a forum where the President& MD shares information related to the business conditions with level 7 & above employees & is held once a month (Based on the availability of MD).

Annual Roll Out: This is an open forum wherein Leadership shares the business results of preceding year’s results & rolls out the business plan for the current year. Roll out is held in the month of January every year.

Human Resources Technicians Sub Committee Meeting (HRTSC): This forum provides a platform for interaction between Human Resources Staff & the representatives from the workplace. This forum has been a great success in resolving various workplace concerns on the principles of mutual understanding.

Canteen Management Committee: This forum has representation from all the departments. This forum meets once a month to address various issues/concerns relating to the canteen.

Transportation Committee: This forum also has representation from all the departments & meets once a month to address the concerns related to employee commutation.

Fun Time: This is an informal get-together of the families of the employees. The employees organize this function once in a year,

39

preferably in the month of December. This is a time for general enjoyment with lots of on-stage cultural activities.

Heartbeat: It’s a quarterly magazine for GMI. Heartbeat is tool used to communicate to all the employees on various activities, announcements, events etc that takes place across all the units of GMI. This magazine is generated from the corporate office with inputs provided by the internal communication personal from all the locations. This is distributed to all the employees.

Junction: It’s an in-house local monthly e-magazine. It covers all the activities, developments and initiatives etc. that are location specific. This magazine is drafted, designed and distributed by the internal communication personal.

4.WELFARE:-

Gratuity & PF – As per Statute. We are a member of RPFC. We have our account with LIC Gratuity. Both the cases payment is as per Statute.

Term Insurance – Family protection against natural death of salaried employee... The payout can vary from 15 – 40 Lacs depending on level.

Mediclaim – Family insurance cover for 2 Lacs. Additionally 3 Lacs for some special diseases. There is a waiting period of one month for claim from the date of registration. For maternity, 9 months waiting is mandatory.

GPA – Coverage for medicine as well as absence from workplace.

In addition to these facilities, there are various other statutory welfare facilities such as,

Well furnished canteen facilities First aid facility Cold drinking water Locker facility Urinals and toilets Washing facility Lightening and ventilations.

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Non-statutory welfare facilities:- Medical facilities Uniforms and shoes.

Security & General Affairs:

Security:

1. ID Card at Main Entry Gate.2. Mobile with Camera is not allowed.3. Fire Safety.4. Visitor Security

General Affairs:

1. Pool Car - Online through Lotus Notes.2. Canteen - Coupons issued on Tuesday & Thursday 1030 – 1130 hrs &

1930 – 2030 hrs3. Transportation – Bus4. Courier Services – 11 p.m. – 05:00 p.m. (Admin Room behind reception)5. Statutory Compliances & Liaison with Government Agencies like – police,

Administration etc,6. Corporate Social Responsibility.7. Event Management - Business Plan rollout, Fun Time, Product Launch etc.

Career Movements:

Levels & Designations• Level 1C/1B/1A – Team Member• Level 2C/2B/2A – Certified TM• Level 2PB/2PA – Asst. Team Leader• Level 3B/3A – Team Leader• Level 3PA/3PB – Area Leader• Level 4C/4B – Sr. Exe /Sr. Eng• Level 4A/5C – Asst. Manager• Level 5B/5A – Dy. Manager• Level 6C/6B/6A – Manager

41

• Level 7C – Div. Mgr• Level 7B – Sr. Div. Mgr• Level 7A – Dy. Gen. Manager• Level 8C – General Manager• Level 8B – Director• Level 8A – Vice President

Communication Channels:• GM believes in Open Door Policy and strongly encourages its employees • To express their opinion• To challenge status quo. • We have several communication forums where senior managements meet

employees• DSM (Diagonal Slice Meeting)• Biz Information Sharing Meeting• New Joiners’ meeting with MD • Departmental Team Meeting• Functional Meeting.• Additionally all the senior people are open to discuss any

ideas/suggestions/observations/issues.

HR Policies:-

1. Recruitment and selection policy2. Performance management policy3. Training and development policy4. Leave policy5. Disciplinary code6. Grievance code7. Termination of employment policy8. Retrenchment policy9. Compensation policy10.Policy for temporary employees11. Health and safety policy12. Conflict of interest policy13.Gift policy.

42

GPSCDepartment

43

M VENKATRAMVICE PRESIDENT GLOBAL PURCHASING

AND SUPPLY CHAIN

VIKAS VARMAGM – INDIRECT/ POWERTRAIN

AC DELCO/ PROGM. MGT/ COST/ PROCESS

RAKESH MISTRYDIRECTOR SFO & SQA

AVADHUT DESHPANDE

MGR – PUR. PPM/ AC DELCO

SYRUS VASANIASR.DIV MGR –

INDIRECTMATERIALS

SHAILESH HAZELASR.MANAGER – POWERTRAIN/

PROCESS/ COST

SNEHAL KHURGESR. EXECUTIVE

VAIBHAV DEVKARSR. EXECUTIVE

BIMAL CHOPRAMANAGER

BHOLA SINGH BAGGA

DEPUTY MGRINTERIORS

PARAG SHARMASR. MANAGEREXTERIOR/ GLASS/

RAW MATERIALS

Neelesh DangeCHASSIS

ASIT CHATTERJEE

DIV MGR STRUCTURES &

CLOSURES

MANISH TIWARI

HVAC/ELECTRICAL

AMIT KUMARPANDEYDY. MGR

SUMIT SARDANA(ASST. MANGER)

RAKESH RANAASST. MANAGER

DHARMESH PARMARBUYER

SHAILESH NERIKERBUYER

MUKUL KUMARASST. MANAGER

ASHOK KANSARASMT LEADER ELECTRICAL

PURCHASESECRETARY

RAJNISH SHARMASR. EXECUTIVE

SUBHOJIT CHATTERJEE

BUYER

Raghavendra HatwarBUYER

GAURAV GUPTABUYER

PRASHANT SHIMPI

AC DELCOBUYER

BHAVIN SHAHDY, MANAGER

DHAVAL CHANDAWALLAPROG. MNGT. JAYANT

BUYERARINDAM GOSWAMI

AM

ALINJAN MUKHERJEE

BUYER

SAMEER SHARMA

BUYER

Sanjeevkumar SharmaBUYER

PANKAJ DHANSHETTY

BUYER

DURGESH SRIVASTAV

BUYER

VIKAS GOELBUYER

PANKAJ UPADHYAY

BUYER

AMIT CHOUDHARY

SR. EXECUTIVE

VACANT

ABHIJIT SINGHBUYER

RASHMI NAIRBUSINESS PROCES

& COST MGT.

VacantBuyer

FRESHTEENAEXECUTIVE

`

PRADEEP BARTAKKE

BUYER

Anilkumar Dubey BUYER

RADHESHYAMMAURYABUYER

Global Purchasing and Supply Chain(GPSC) is headed by Bo Anderson at the Global level and assisting him at the Asia Pacific Operations is James Bovenzi. Mr. M. Venkatraman is the leading authority of the GPSC in India.GPSC can broadly be divided into 4 areas:

44

1. Direct Purchase : This department is responsible for sourcing and procuring the parts which are directly required for the manufacturing of GM vehicles. For Example; Powertrains purchase, chemicals, rubber etc.

2. Indirect Purchase: This department is responsible for the purchase of products which are indirectly related to the manufacturing of the vehicles such as Machinery, Equipments, and Office Stationery etc.

3. Supplier Quality Assurance: The SQA department is responsible for ensuring that the materials and products purchased conform to the GM standards. There is no compromise on the quality of the parts and products purchased by GM.

4. Material Planning and Control Logistics: The MPCL department is responsible for the scheduling and the shipment of parts which are local or overseas from the supplier to the Manufacturing Line. It also looks after the logistics, warehousing etc.

Direct Purchase:

INDIRECT/MACHINERY & EQUIPMENT

ADVANCE/DIRECT PURCHASING

SU

PP

LY

C

HA

IN

Roles of PurchasingRoles of Purchasing

SUPERIORQUALITY

45

Direct Purchase has 7 sub systems and each sub system has its own management team. The team consists of a leader at regional and global level and buyers to buy parts relating to their sub systems and manufacturing of GM vehicles. The parts are categorized into commodities and each commodity has a global commodity manager. A subsystem may consist of one or more commodities.

The seven sub systems are:1. Interiors2. Exteriors3. Structures and Closures4. HVAC and Electrical5. Chassis6. Power Train

Global Sourcing:

“Global Sourcing” (GS) is a tool to ensure quality, services and prices of current parts and materials which are directly required in the manufacturing process. Sourcing activities involving current production parts and parts with PPAP status requires a request for quote (RFQ) to be sent to one or more suppliers. Global sourcing does not occur once or twice a year but it is an ongoing process to identify the best in class supplier based on cost drivers. Global sourcing starts with the comparison of the existing conditions such as quality service ratings towards GM and price quotations of the current suppliers with the world wide competitors.

Functions in Purchasing:

Supplier Quality Assurance Supply Chain Purchase Planning M&E & Indirect Purchasing Powertrain GM Service Parts Operation & AC Delco

46

SFO

Fundamentals of Working Together:

Expectations of the Supplier from GM India

• Equal opportunity for capable suppliers• Integrity in everything we do• Clearly defined expectations and rewards• Simple and common performance metrics• Assistance when needed • Prompt payment

Expectations of GM India:

• Be clear on where you want to be with GM – What is supplier’s vision?• Integrity in everything supplier does• Alignment to GM priorities• Focus on the right things• Fast awareness of potential issues• Be a GM ambassador

Prerequisites for Potential Suppliers:

Develop bidders list

Implement source recommendation

Identify global sourcing

Prepare distributors list

Receive, analyze and summarize

Obtain sourcing recommendatio

Prepare distributors

list

Receive, analyze & summarize

47

• Monitoring of Tier 2/3 Suppliers• Launch Readiness for New Programs• Strong Logistics Systems • QS 9000/TS 16949 Certification• Engineering/technical Capabilities• Testing and Validation Capabilities• Production Capacity• Financial Strength• World Class Quality• Flawless Execution• World Class Technology• Competitive Advantage• Continued Process Capability Reviews• Focus on Reliability and Durability • Language/Cultural Understanding• Human Resource & Talent Base

What do Customers “Want”:• Emotional and compelling designs• Rich value-transmitting interiors• The best powertrains• Competitive technology• Superb quality and reliability

What Makes a World Class Supplier?

48

India: An economy ready to take-off: Sustained Economic growth - GDP growth outlook:

Next Decade: 8%* Next 50 years: 6%* FII Investment: Over US$ 7 billion so far this year All Time High Forex Reserves: US $ 125 Billion Currency: Stable, Will be Fully Convertible in 2 years Healthy Savings Rate: Gross domestic saving – 24.2 % of GDP Exports growth: Over 19 % p.a. in the last 2 years Growing Consumerism: Easing Interest rates

Source: Goldman Sachs

Best-in-Class ValueQuality PerformanceSustainable Cost

AdvantageFlawless Launches

+

Bring Best-in-Class Designs

Breakthrough Technology

Go Fast

+

“Can Do” AttitudeObsessed with

Continuous Improvement

Team SpiritSaying “No” the Right

Way

Superior Competitiv

e Advantage

Superior Competitiv

e Advantage

Superior Organizatio

nal Capability

Superior Organizatio

nal Capability

Superior Culture

Superior Culture

Sustainable Contribution and Value

49

Asia Pacific – An opportunity to Indian Suppliers:

Opportunities:•Highest Growth Market for OEM’s in the world – especially India,

China, ASEAN and Korea• Supply base opportunities in many countries for Tier 1/2/3 content • Delay in taking advantage as either a supplier or a customer of

regional opportunities will mean your competitors are gaining momentum

Focus for Indian Suppliers:• Migrate to contemporary technology• Dynamic FMEAs / Control plan and strict adherence• Continued Process capability reviews• Focus on reliability and durability • Monitoring of Tier 2/3 suppliers• Launch Readiness for new programs• Improved logistics systems to support export customer

Performance is based on All PrioritiesQuality/Launch/Current-Future Business

Grow the bestFix those that have strategic value

No choice but to Exit the rest

GROWGROW FIXFIX EXITEXIT

Need to be the best to grow with GM

Supplier Performance StrategySupplier Performance Strategy

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Supplier Details:

Total Suppliers: 119nos. TS16949 Certified: 96nos. QS9000: 17nos. ISO 9000: 1no. Waiver: 5nos. ISO 14001 Certified: 67nos. Planned: 8nos.

Transition to a low cost base:

f

51

India59%

GMDAT35%

Isuzu- Thiland1%

Isuzu- Japan5%

Vehicle DistributionDepartment

52

BLOCK DIAGRAM OF DISTRIBUTION PROCESS:

Places Order with the Dealer

Order entered into DMS & Upload on WEB

DealerEnd User Customer

OR

Filled Order Form sent to GMI Distribution thro' Fax, Mail or Informed on Telephone

Dealer gets the desire information from the WEB

GMI DISTRIBUTION STAFF

Check for the legibility of order(WCO) recd. By Fax/ E mail

Check the stock

availability for the order

Check the Limit for the Dealer

Create Order into SAP if received thro' Fax, Mail or Phone

Create Delivery in SAP

GMI FINANCE - CREDIT MANAGEMENT

Check Credit Limit against Order

Release the Sales Order In the SAP

Give the Sales Order to ACS (Bangalore) & get the Sales

Order released

GMI DISPATCH

Goods Issue to be done of Sales Order

Print the invoice copies & Form 22 thro' SAP

Hand Over the car along with documents to transporter

Hand Over the car along with documents to transporter

Transporter to dispatch the car as per GMI Dispatch

Upload the dispatch Info. In WEB

GMI FINANCE - ACS INVOICING

Recheck the Pricing & Save the Invoice in SAP

REFERENCES

FMT/VSSM/DIS/001

CONTROL POINTS

99% Invoicing on Same Day of Credit Release

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DISTRIBUTION DEPARTMENT:

The distribution department is located in GMI Halol plant. It is one of the most important departments of the company. Distribution department is a part of marketing department which handles all the sale & clearance of vehicles which are distributed all over the country as well as to Nepal & Sri Lanka. Distribution department is linked with many other departments i.e. production planning, finance, dispatch, paint shop & body shop. It is also linked with various dealers present in India, respective regional office & stockyards in Mumbai, Kerala & Karnataka. In distribution the process starts from requirement given by the dealer till the final allotment of vehicles & dispatching them to their respective areas.

Distribution department is responsible for all the activities happening in the plant. They are responsible for how many vehicles are to be taken into production in the plant & how many vehicles are to be allocated for sale every day. The department generates various reports which give complete details about the sales, how many vehicles are in production, number of vehicles lying in stockyards, number of vehicles in dispatch, number of vehicles invoiced, pending orders etc.

Distribution department also takes care of government sales which is called DGS&D (Directorate General of Supply & Disposal). Government has enforced certain norms which are to be followed while billing the vehicles to them. The department follows a predefined procedure to bill the vehicles to government.

Distribution department keeps all the records of customers by whom the vehicles are purchased. On an average GM sells around 2000 vehicles every month all over India. Its major markets are north & west India. At present highest sale is of Chevrolet Aveo- UVA, a new model introduced by GMI.

The marketing department is located at Gurgaon (Haryana) & Halol and is responsible for vehicle sales and distribution. Also market forecasting, product features, variant suggestions and demand & supply analysis is carried out by Marketing. Based on the demand & supply data by marketing department the production planning is carried out so that there remains a balance between demand & supply, thus inventory control is achieved.Another important activity is to provide a correct and timely forecast for possible sales of various models in the GMI range. It helps the production team

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to plan, produce and supply the vehicles accordingly. This also ensures that the customer’s requirements are met and GMI maintains a competitive presence in the market.

USING OVAAP SYSTEM:

OVAAP system is a web based system used by dealers to send orders. OVAAP stands for Online Vehicle and Parts Processing. It’s a more efficient way to place order from the customer.

As it was introduced, it is not being used extensively by the dealers to place order. Dealers are at present placing orders via fax, telephone, e-mails. This creates a chaos in the distribution process as all the orders are to be stored for future reference.

Reasons for not using OVAAP facility are:1. Dealers reluctant to use the facility.2. Less knowledge of how to use it.3. Finding it fax, e-mail & telephone easy to use to place orders

Troubles which may occur by not using it:1. Difficulty to store orders given.2. More time consumption.3. Stressful activity for the team.4. Wrong orders can be punched.5. Wrong delivery is made.6. More paper work done.

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VEHICLE DISTRIBUTION PROCESS FLOW CHART:

YES NO

NO

YES

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DEALER AREA MANAGER

DISTRIBUTION GMI

PERFORMS

DETAILED

PROCESS BY GMI

ACS

SEND DETAILS TO FINANCE

CREDIT RELEASE /INVOICE

MAKE AVAIBILITY OF STOCK/FUNDS

INFORM DIST/FINAN & GMI

(PRICING SEC)

CHECK FOR TRANSPOR

T

WAIT TILL AVAIBILITY

SEND VEHICLE END

START/CUSTOMER

PROCESS DESCRIPTION:

1. The whole process is initiated by the customer. Customer selects the car from the respective retail outlet to buy. He gives the complete description as to what model he wants, engine type, color, accessories etc. He places the order to the dealer with the required specifications. Customer books the vehicle by giving some token money.

2. After getting all the details from the customer, the dealer will check the stock on OVAPP (Online Vehicle and Parts Processing). If the stock is available he places the order & arrangers the funds for billing the vehicles. If the stock is not available then he contacts the area manager & gets the tentative availability of the vehicle & continues with the same process stated above. Each area manager has been assigned regions which he would be responsible for. At present their 15 area managers all over India who are looking after the sales in their respective regions.

3. GMI distribution department accepts all the orders from the dealers/ area managers.

4. GMI distribution checks the legibility of the orders. After that they check the stock for availability of the vehicle that has been ordered. If the vehicle is not available in the stock, they place the order to production department for making the vehicle.

5. The credit limit is checked & it is then send to finance department for further processing.

6. The finance is handled by ACS an outsourcing company in Bangalore. The sales order from distribution department is sent to ACS. ACS reconciles the payment against the order as well as price of the order. After doing this it gives order to release the vehicle in SAP after removing credit block.

7. Entry is made into SAP of creating delivery.8. After creating delivery in SAP, the details are send to GMI Dispatch

department. Here the goods issued & are created in SAP.9. Dispatch sends the details to ACS finance for a final check of the pricing

& saves the invoice into SAP. The details are then send back to dispatch department.

10.Then dispatch prints the invoice cum delivery form along with challan & form 22.

11. It checks the availability of transportation. Vehicles are send by trailers to respective locations. Dispatch hands over the necessary document, to transporter along with the vehicle.

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12.If the transportation is not available, dispatch makes the availability of the trailers as quickly as possible so that the vehicles are not delayed & can reach the destination on time.

13.As the vehicle is received by the dealer, he does PDI (Pre Delivery Inspection) Before delivering the vehicle to the customer.

WHOLESALE CAR ORDER FORM (WCO):

Upon opening of a Retail Sales order (RSO), the dealer will raise Wholesale Car Order (WCO) on OVAPP (Online Vehicle and Parts Process) through WWW.GMINDIADISTRIBUTION.COM site or EXCEL base WCO (Wholesale Car Order) format. The WCO will clearly identify the details of the car, shipment, payment, options, fleet, pricing structure, date of delivery to the customer etc. One Wholesale order sheet may be used to place 20 WCO’s of any vehicle.

The numbering of Wholesale Car Order would be first 6 characters for dealership code, followed by a slash “/” and then a running 6 digit serial number, i.e. Wholesale Car Order No. NDL001/005001, first six digit indicate dealership code, British Motor Car Co. & last six digit order serial number.

WCO includes the following:

Full description of the variant ordered Finance name Full shipping and billing address Mention the options for e.g. Alloy wheels clearly in bold letters Write the Dealer Code Maintain the wholesale car order series and pay accordingly Mark a copy to your Zonal Sales Manager for information

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Specimen of wholesale car order form:

CAR SCHEDULING PROCEDURE:

1. Sales Planning is done by sales team. They forecast the plan & direct the plan to GMI Distribution team. GMI Distribution team reviews the wholesale plan & makes notes as to number of vehicles that they have to sale in particular month.

2. GMI Distribution dept initiates according to the plan & makes strategies accordingly.

3. Cars are scheduled according to the pre-sales plan. The procedure as follows.

o Orders are received from dealers, zonal managers & area managers via phone, e-mail or fax.

o Credit limits for the orders placed are reviewed by finance.o After completing the process invoicing is done as per priority

given by sales team.

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GMI- STOCKYARD:

GMI maintains 3 stockyards i.e. Mumbai, Kerala, Karnataka. The stockyards can hold approx 250-300 vehicles at one time. Stockyards cater to the sale of vehicles in their respective states because of high demand of vehicles there. E.g. Mumbai stockyard caters to sale of vehicles in Maharashtra. If the vehicles are sold to other states, the company will have to bear sales tax. Vehicles are send to these stockyards from Halol plant.

4. USE OF 4P’s OF MARKETING BY G.M.IDefinition of Marketing

PUTTING THE RIGHT PRODUCT AT THE RIGHT PLACE, AT THE RIGHT PRICE AND AT THE RIGHT TIMEMarketing mix" is a general phrase used to describe the different kinds of choices organizations have to make in the whole process of bringing a product or service to market. The 4 Ps is one way – probably the best-known. All the 4 strategies of marketing mix are interrelated. Having a powerful marketing mix will not only help the company in acquiring market share but will also have a good sale & good impact in the mind of the masses.

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HALOL PLANTGMI STOCKYARD

MUMBAI STOCKYARD

KERALA STOCKYARD

KARNATAKA STOCKYARD

The 4Ps are Product Place Price Promotion

We all know about the 4P’s of marketing viz. Product, Place, Price & Promotion. All the 4P’s play a very important role in marketing strategy for the company. The image of the company is built with a proper blend of all the 4P’s. 4P’s for GMI are as follows:

1. Product:This implies to the all the vehicles that are produced at GMI plant for sale in the market.Different products cater to different levels of society. Different products of GMI are.

Tavera Optra Spark Aveo- UVA SRV

All the 5 vehicles have different variants according to the requirement of the customer’s choice. Each variant is priced differently. GMI does this so that the customers are given enough options to choose from. The simplest model is “base model” which has the lowest price & the highest model is “LT” which has the highest price. Both these variants are available in all the vehicles.

Every product is designed & in competition with other vehicles in the market. The company keeps making changes in the features of the vehicles over a period of time which keeps them in demand in the market as the customers are always interested in new designs of the vehicles. New designs helps in keeping in pace & maintain a position within the market place.

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Customer always chooses the vehicles according to his needs & requirements’. As there are many vehicles available in the market, so many choices also. GMI vehicles are available in all the categories right from 3.5laks to 11laks with different variants available which adds into the uniqueness on the vehicles.

For e.g. Chev Spark with basic features would cater to small families where as Chevy Optra LT model will cater to customers in the higher segment i.e. the upper-middle or the upper class of customers. GM is a world recognized company, so its vehicles are also manufactured keeping in mind the global standards. All GMI vehicles are stylish, fuel efficient, affordable, and very safe. This makes GM one of the topmost vehicle manufacturing company in the world. GMI follows a rigorous quality check before selling the vehicles to its customers. The process involves many criteria on which the quality of vehicles depends on various globally approved standards which are followed in all GM plants.

2. Place:This is one of the important factors in marketing. GMI sells the vehicles all over the country. They have divided India into north sales, east sales, west sales & south sales. Major sales of vehicles are manly in metros like New Delhi, Mumbai, Bangalore, Chennai, Hyderabad, Calcutta, Poona etc... Deliveries of vehicles to their respective areas are managed by coordination between GMI Distribution & Dispatch Depts. This is the most challenging job as the vehicles should reach in the customers hand in the quickest time. They cannot afford any delays as they could loose the customer. Therefore we need a very effective & right distribution channel to cater to our customers. The dealers are the face of the company in the market.

3. Price:Pricing of the vehicles is the most crucial factor for any organization. Pricing is done with taking into consideration of the following factors.

a) How much a customers can payb) Governmental policies i.e. VAT, Taxesc) Competition with other players in the same fieldd) Market condition

Indian automobile market is flooded with many local as well as international players. Every one has a wide range of pricing strategy that attracts the customers to them.

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Any Indian customer will consider the following factors before buying the vehicles.

a) Is the price affordableb) What benefits is he getting from buying the vehicle.c) Will the vehicle satisfy his needsd) How cost effective will be the vehicle

E.g. if the customer has a budget of around 8 lacks, he would have a wide range of cars to choose from. The customer will only opt for that car that will qualify in all this criteria. GMI should implement a 3 stage pricing strategy to its vehicles to attract customers.

In the 1st stage GMI should have an introductory price to attract the customers. It would be a tempting offer to the customer as he is getting more facilities in a less price. In this way the customer will be attracted & thus sale of vehicle can pick up right from its launch into the market.

In the 2nd stage as the sale would have picked up, GMI should increase the price by few percent. As the sale has already picked up & customers satisfied, more customers would initiate buying the vehicles even at a slightly higher price as a good word of mouth has already been spread by previous customers. This would keep the market hot & demanding.

In the starting of the 3rd stage, the market has picked up pace, now when the company wants to decline the product from the market; they should reduce the price again so that maximum vehicles are sold in that period before the product is taken off from the market.

Pricing can also be done my keeping festive seasons in mind. In India there is vast sale of all kinds of vehicle’s during festivals. Initiating this kind of pricing strategy would work wonders for the company & help them acquire a good market share & it would also create a good impact in the customer mind. There are always fewer sales in the months from May till August; here the company can reduce the price of some vehicles of come up with various offers to keep attracting more customers.

4. PromotionPromotion plays a very important role in marketing. It is the method by which any organization spreads awareness to the customers about their products. Promotion is done many by using all types of media. Customers are more prone & depended on media to gather information about the product. Promotion

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educates the customers about the product is being launched in the market, how it will be useful to customer, will the customer afford to buy it etc. The customer pays a lot of attention to what the media says. Doing this creates a very good image of the company in the minds of the people.

GMI had “Club Astra” as the time of when they sold Opel Astra into the market. The members were Astra owners. There were get together, parties, picnic etc... That was organized by “Club Astra”. It worked off well for GMI. GMI should initiate more such promotional ways to attract its customers. This would also create a brand image of the company in the market. In festive months promotion should be in a different manner & there should be many offers to attract the customers.

At present GMI has approx of 8-9 percent of market share. To pick up a good share into the market GMI should concentrate more on right kind of promotion for right kind of vehicles so that it would create a good image in the minds of the customers & thus attract them. In this way we can say that using the basic 4P’s of marketing can be of great value to the company as well as to the customers. This will also add to good image & more sales for the company.

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PDCA (" Plan-Do-Check-Act ") is an iterative four-step problem-solving process typically used in business process improvement. It is also known as the Deming Cycle, Shewhart cycle, Deming Wheel, or Plan-Do-Study-Act.

PLAN: Establish the objectives and processes necessary to deliver results in accordance with the expected output. By making the expected output the focus, it differs from other techniques in that the completeness and accuracy of the specification is also part of the improvement.

DO: Implement the new processes. Often on a small scale if possible. CHECK: Measure the new processes and compare the results against the

expected results to ascertain any differences. ACT: Analyze the differences to determine their cause. Each will be part of

either one or more of the P-D-C-A steps. Determine where to apply changes that will include improvement. When a pass through these four steps does not result in the need to improve, refine the scope to which PDCA is applied until there is a plan that involves improvement.

Feed-forward is a term describing an element or pathway within a control system which passes a controlling signal from a source in the control system's external environment, often a command signal from an external operator, to a load elsewhere in its external environment. A control system which has only feed-forward behavior responds to its control signal in a pre-defined way without responding to how the load reacts; it is in contrast with a system that also has feedback, which adjusts the output to take account of how it affects the load, and how the load itself may vary unpredictably; the load is considered to belong to the external environment of the system.

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Some prerequisites are needed for control scheme to be reliable by pure feed-forward without feedback: the external command or

controlling signal must be available, and the effect of the output of the system on the load should be known (that usually means that the load must be predictably unchanging with time). Sometimes pure feed-forward control without feedback is called 'ballistic', because once a control signal has been sent, it cannot be further adjusted; any corrective adjustment must be by way of a new control signal. In contrast 'cruise control' adjusts the output in response to the load that it encounters, by a feedback mechanism.

A lead time is the period of time between the initiation of any process of production and the completion of that process. Thus the lead time for ordering a new car from a manufacturer may be anywhere from 2 weeks to 6 months. In industry, lead time reduction is an important part of lean manufacturing.

Lead time in Supply Chain Management:

A more conventional definition of Lead Time in the Supply Chain Management realms is the time from the moment the supplier receives an order to the moment it is shipped. In the absence of finished goods or intermediate (Work In Progress) inventory--it is the time it takes to actually manufacture the order without any inventory other than raw materials or supply parts.

Lead time in Manufacturing:

In the manufacturing environment, Lead Time has the same definition as that of Supply Chain Management, but it includes the time required to ship the product to the purchaser. The shipping time is included because the manufacturing company needs to know when the parts will be available for Material requirements planning. It is also possible for lead time to include the time it takes for a company to process and have the part ready for manufacturing once it has been received. The time it takes a company to unload a product from a truck, inspect it, and move it into storage is non-trivial. With tight manufacturing constraints or when a company is using Just In Time manufacturing it is important for supply chain to know how long their own internal processes take.

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Example:

Company A needs a part that can be manufactured in two days once Company B has received an order. It takes three days for company A to receive the part once shipped, and one additional day before the part is ready to go into manufacturing.

If Company A's Supply Chain calls Company B they will be quoted a lead time of 2 days for the part.

If Company A's Manufacturing division asks the Supply Chain division what the lead time is, they will be quoted 5 days since shipping will be included.

If a line worker asks the Manufacturing Division boss what the lead time is before the part is ready to be used, it will be 6 days because setup time will be included.

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