AZGARD NINE LIMITED UNIT II

3 Km off Muzaffar garh , Ali pur Road,

Pakistan

Phone: +92 (0)42 111-786-645

Fax: +92 (0)42 538 3591

Website:

www.AZGARD9.com

Supervised By:

Internship Advisor:

Submitted By:
Muhammad Ikhlaq Ahmed
MBA Finance

Submission Date:
 At first I am thankful to Almighty ALLAH and the Holy Prophet
(P.B.U.H), their blessings have been have with me in all good and bad times.
Then I’m grateful for the thorough support by my advisor…………… for
helping me determine the objective of the report and guiding me though to get
to the end. He made me grateful with his valuable suggestions from time to time
during my internship.
I must thank…………………………. for providing related information on
which this project is based. He has been a great support from the choice of the
topic, learning of different part of research and understanding the difference
between theory and practices.
I really should thank every other employee of Azgard9, whom I found
during different phases of my internship. Most of them have been very open
and friendly with me and provided me with the answers I needed from them.
They were the constant source of inspiration and encouragement that helped in
completion of my internship.

The Holy Prophet Muhammad (S.A.W.) The greater Social reformer and

guide in every sphere of life. My affectionate parents who taught me the first

word of speak and supported me morally and financially throughout my

studies.
 Table of Contents

Page
1. Executive Summary
6.
Struct
2. Industry Overview ure,
2.1 Textile Industry Desig
2.2 Spinning Industry n and
Issues
3. Introduction of Organization Divisio
ns and
3.1 History of Azgard9
6 Group
3.2 Company Vision . s of its
3.3 Company Mission 1 Units
3.4 Core Values Azgard
3.5 Company overview 9’s
3.6 Name of Department 6 Busine
. ss
2 Include
4. Introduction of Business Division Decisi
4.1 Spinning 6 on
4.2 Spinning Process . Makin
3g

5. A Managerial View Conflict

s and
5.1 Planning Process and Tools / Techniques 6their
5.2 Organizational Structure and Design .Resolu
5.3 Communication 4tion
5.4 Motivational Techniques Used Power
6 and
5.5 Controlling Authorities
. Policie
5.6 Control Approaches Used 5s
7.
Strate
gies &
Analy
sis
Comp
etitive
Strate
7.1
gy
Market
ing
Strate
7.2
gy
7
.
3
S
W
O
T
A
n
a
l
y
 sis
7.4 Financial Analysis
8. Core Internship Experience
8.1 Hierarchy of Marketing Department
8.2 Export Section
8.3 Local Sale Section
9. Conclusion
10. Recommendations
11. Bibliography
12. References
13. Glossary

1. Executive Summary

This report consists of my Twenty weeks internship at Azgard9

Limited unit II which is situated at Muzaffar garh ,Ali pur Road but main branch
situated at Manga, Raiwind Road, near Lahore. Azgard is consistently focusing
on improving performance so that risks can be left far behind. Azgard is a
responsible entity which is highly committed to comply with the corporate,
envoi mental laws and to conduct their business with utmost honesty and
sincerity. At Azgard it is believed that development can only be achieved by
equality and respect at work place. They have been doing it for decades and
there is no doubt they are reaping its benefits.
The Company’s management, combining innovative strategies,
aggressive marketing, creative synergy and visionary approach together with a
lean organizational structure capable of efficient response, succeeded in
establishing Azgard9 as the largest Yarn Business in the country, with sales to
the tune of Rs. 6, 628,341,926.
Azgard9 has been benefited by the management’s highly
responsive approach, increasing its profits significantly since its acquisition from
the Government of Pakistan. 2008 posed to be challenging, primarily owing to
the high raw material prices, comparatively less productive workforce as
compared to the major competing countries, rising fuel prices resulting in higher
domestic and International freight costs, and probable rise in minimum wages,
these factors are mitigated by Azgard9's stronger business model within the
Division and the Company.

2. Industry Overview

2.1 Textile Industry

In 1947, at the time of independence Pakistan Textile Industry

was like a feeble child with only three cotton mills, a small woolen spinning,
whereas weaving, hosiery and knitwear were features of cottage industry. Now
when we have entered into new millennium, Pakistan’s Textile Industry has become
a stalwart fellow, which has grown in all sections. Now we are not only self-
sufficient but are also exporting surplus products. Today we have over 8358 million
installed spindles, 166,000 installed rotors, 20,000 shuttle less looms, 200,000
power looms, 8,000 terry towel looms, 7620 canvas looms, 157,000
woolen/worsted installed spindles, 15,000 woolen looms, 12,000 knitting machines,
over 600 processing units and over 2500 garments units.
We all know, journey of textiles start from seed and culminates at
ready-to-wear garments and in present competitive world scenario, it is
combination of high production efficiencies, most appropriate technologies and
work methods, together with trained work force, management and marketing skills
which give any Industry a successful status.
Textile industry today is the backbone of economy of Pakistan
and provides the largest number i.e. about 40% of total industrial jobs and very
vast industrial service opportunities. It has always been the pillar of Pakistan’s
economy contributing substantially to Govt. revenues. It also has a dual linkage.
As a major consumer of domestic cotton, it provides a market for a leading cash
crop and thus has a critical influence on the growth and productivity in agrarian
sector. Hence the performance of the textile industry has a vital impact on the
overall growth and performance of the textile industry has a vital impact on the
overall growth and development of the economy. The industry also tops, as an
earner of ever-so-scarce foreign exchange and exported goods worth US $4.9
billion last year and this amount is about 60% of the total national exports. Its
share in total GDP is 8.5%. The investment in Textile Industry is 31% of the total
investment. The interest that banks and other financial institutions earn from
Textile sector is Rs. 4 billion per annum.

The salaries and wages that Textile sector provides to workers is 40

billion per annum. Its contribution to R & D is Rs. 116 million per annum. This very
remarkable achievement did not come easily and is due to combined and tireless
efforts of the Govt. planners, industrialists, technical support staff and our hard
working and inexpensive labor. On the top of these, Pakistan has been blessed
with suitable climate and perennial supply of good quality water to grow about 1.7
million tons per annum of lint cotton, “the silver fiber” that forms a natural and
sound base for a viable textile industry. Pakistan textile industry consumed 1441
million Kg raw cotton and 406 million Kg fiber during 1998 – 1999.
Value-added product exports of Pakistan Textile industry are very less.
The percentage of yarn exports in total textile exports in total textile exports in 20%
and percentage of cloth is 24% while 56% of total textile exports includes others
textile manufacturers. We should product more value-added products because if
we see the value addition chain the prices of cotton, yarn, cloth, garments, towels,
bed wear are US$ 1.33, US$ 2.33, US$ 5.41, US$ 6.71, US$ 4.05, US$ 5.51 per
Kg respectively. Thus we can earn additional foreign exchange by exporting value-
added products.

2.2 Spinning Industry

Areas comprising West and East Pakistan were big producers of good
quality cotton and jute fibrous raw materials but the value-added conversion industries
were mainly located around the Indian cities if Bombay and Calcutta in the respective
order. At the time of independence Pakistan was producing about one million bales of
cotton, which were exported and from the receipts, cloth and yarn for the handlooms
were imported. The Govt. took notice of this situation immediately and encouraged
setting up mills in both the wings of the country and in 1960 installed two million
spindles and 30,000 looms. In those days Govt. sanctioned only composite mills with
25,000 spindles, 500 looms and a wet processing unit to finish the cloth produced in
mills. The balanced quality of yarn was required to be sold often through an official
channel to the weavers of handlooms and later to the power looms. The mill owners
made huge profits but their efforts for further investment were hindered due to paucity
of foreign exchange.
This situation, however eased when the machinery manufacturers started
offering their plants under “the suppliers credit or pay as you earn” plans. This facility
brought is its wake escalation of prices of the textile machines and this started a new
development of installing only the spinning units of 12,500 spindles. Many of the
spinning units were then sanctioned on political consideration but went into the hands
of genuine entrepreneurs is no time. At the time Govt. tried to disperse the industry
away from the existing industrialized cities and new textile centers emerged in small
towns like Kotri, Sheikhupure etc. although these were quite close to the existing
centers in the big cities. By 1971, Pakistan had a substantial textile industry with about
3.5 million spindles and 38,000 looms in the mills sector and exported textile goods
worth US$ 400 million.
After the separation of East wing, Pakistan was left with about 2.5 million
working spindles but growth was continuous and rapid and by 1985, the figure reached
3 million. At that time the Govt. took a decision to convert all the home growth cotton
into yarn and for the first time, decided to waive the requirement of getting official
sanction for setting up a spinning mill. This decision opened the floodgate and in just
five years, the capacity increased to 5 million spindles. The present working capacity is
about 8,358 million spindles and 166,000 rotors. It may be mentioned that about 1.724
million spindles are lying idle in 143 financially sick mills which being of old technology
have become redundant.
In 1998-1999, the spinning industry produced 1542 million Kg of yarn out
of which about 26% was blended yarn, 47% was coarse count yarn, 24% was medium
court yarn, 2% fine and 1% super fine yarn.
Development in the spinning sector is not in numbers alone but there is also
an improvement in average productivity. On the basis of 20/1 count productivity has
gone up from 190 grams in 1986-87 to 235 grams per shift per spindle in 1996-97.
Pakistan exported 508 tons that is about 33% of total cotton yarn produced in 1996-97
and this makes her the largest exporters in the world with a share of about 28%. This is
not to be very proud of because of the yarn in a primary and not a value-added
commodity. Incidentally it has been estimated that about 70% of the total cotton yarn is
exported directly or after conversion into the value-added products.
During 1998-1999 textile industry produced 1,542 million Kg of yarn, out of
which 54.94 million Kg (3.56%) was consumed in mill while 417.78 million Kg (27.10%)
was exported and 1,069.2 million Kg (69.34%) was available for local market. The
price of yarn (20/1) during 1998-1999 was Rs. 472.61 per bundle of 10 lbs.
Pakistan exports yarn to the following major countries: Hong Kong (25.38%
of total yarn export), Japan (19.72%), South Korea (8.90%), Asian countries (8.31%),
Dubai (3.72%), China (7.77%), and USA (4.81%).
 3. Introduction of Organization

We are a vertically specialized textile company. We manufacture

virgin fibers to retail ready products, which are marketed through our global sales and
distribution set up. Azgard9 Ltd is about a 100 million US $ company with sales offices
in five (5) countries. Our business includes Specialized Yarns, Denim Fabrics and
Denim Garments.

Azgard9 Limited

The Origins and the Inception

‘A place at the centre of the universe inhabited by the GODS’

Azgard is represented and embodied by the LOGO we have created; the oval
male form is representative of the universe and the void or female portion in the centre,
where ‘THE GODS RESIDE’. The universe is cradling the void as if to protect as well
as nurture it as it is contained in the centre of the ‘WOMB’ of the universe in a fetal
position.
In the ancient legend ‘AZGARD’ was one of nine worlds in NORSE
MYTHOLOGY- it was protected by ‘HEIMDALL’ the son of nine different mothers each
attributing him with a particular skill and power- and thus he would protect Azgard from
the powers that be.

The significance of nine for the members of Azgard

The significance of Nine for our company is not just based on this mythology
but also connected with the auspicious nature of this number throughout many different
elements in and of the world today that affect humans and their behavior. The number
‘NINE’ is considered to be an auspicious and important number in Indian, Chinese,
Japanese, and Greek, cultures for various different reasons
In Chinese culture the number Nine represents ‘Change’ and ‘Transformation
as is the case with Azgard Nine Limited, which is changing and transforming itself into
a global entity with new goals, aspirations, and targets.
Nine is much of Ancient Greek Mythology also has represented ‘Gestation’
and ‘Fulfillment of Creation’ as it does for us at Azgard Nine- The ‘Fulfillment of
Creation’ for us being the forming of this global entity incepted by Nine members on the
Ninth day of February sowing the seeds for an auspicious and rewarding future.
3.1 History of Azgard9

Azgard-9 Nine Limited is one of the oldest business groups on the

Asian sub-continent. It was started as a family business over four generations ago.
The Sheikh Family, now in the fourth generation, is one of the oldest business
families in the Sub Continent with experience in many different sectors. The family
began its first operations in 1886 as a first Ginning factory in Shamkot India.
After the formation of Pakistan in 1947, the group saw massive
growth, whilst consolidating its position in the market. At the end of this period the
group employed over 15000 people.
In 1972 the group became international by expanding to Ireland in
the textile sector. In 1978 the group established a presence in the United States by
acquiring Burke Mills Inc. in North Carolina. By 1980 this presence was also
expanding and fortified with the addition of another company Tennessee Textiles.
The group was now solidly focused on the textile sector. We set up AZGARD NINE
LIMITED in 1994 as a fully integrated vertical denim unit for fabrics and garments
in collaboration with LEGLER SPA. Of Italy In 1996 we expanded our American
operations to Mexico where we set up a yarn twisting operation as another joint
venture between the NAFEES group and the Alpha group, which is the largest
industrial group in Mexico.
3.2 Company Vision

Our vision is to become a major global fashion Apparel Company

3.3 Company Mission

“To retain a leadership position as the largest value added denim Products
Company in Pakistan”

3.4 Core Values

(a) Respect For All

(b) Integrity
(c) Hard Work
(d) Ethics
 (a) Respect for All

 Does not discriminate on the basis of race, religion or

ethnic background
 Respect for Women
 Strongly prohibit all forms of harassments. For example racial, sexual
or any kind
 Attract, retain and develop outstanding people
(b) Integrity

 Honesty to self, colleagues and Azgard9

(c) Hard Work

 Company mission can be only achieved by hard work

 Honesty and hard work is appreciated and rewarded such as:
(i) Incentives upon achievement of target
(ii) Performance based incentives and promotions

(d) Ethics

 Professional behavior shall be entertained. e.g. gifts and favors will

not be accepted
 Personal beliefs of employee will be respected
 Responsibility and accountability
 Changes in Policies/Procedures shall be informed beforehand to the
concerned individuals
 Work ethics:

 Attendance
 Teamwork
 Appearance
 Attitude
 Productivity
 Cooperation
 Respect
 Character
 Communication

.
 3.5 Company Overview

Company Name:

Azgard Nine Limited

Legal Status:
Public Limited Company

Registered Office:
Ismail Alwen e science

Office Shahrah-e-Roomi
Lahore, 54600

Ph: +92(0)42 111 -786-645

Fax: +92(0)42 5761791

Chairperson

Mr. Mueen Afzal

Chief Executive
Mr. Ahmed H. Shaikh

Directors

Mr. Aehsun M.H. sheikh

Mr. Ali Jehangir Siddiqui

Mr. Khalid A.H.Al-Sagar

Mr. Mohammed Khaishgi

Mr. Mian Mahboob Ahmed chief justice (Retd.)

Company’s Secretary:

Mr. Muhammad Ijaz Haider

Auditors:

Rehman Sarfaraz &co

Chartered Accountants

Legal Advisor:

Hamid Law Association.

Hassan &Hassan Advocate

Bankers:

Allied Bank of Pakistan Limited

Faysal bank limited

NIB limited

National bank of Pakistan

Habib Bank Limited

JS bank limited

MCB limited

United bank limited

Standard chartered bank

Finance Department:

Mr. Tariq Muhammad Khan

Mr. Ahmed Sheikh

Mr. Ali Jehangir Siddiqui

 3.6 Name of the Department

Security
Admin / Human Time office
Resource Receiving pay
Fire fighting
Management
Department
Accounts officer
Accounts Raw material inventory
Department Dispatch incharge
Wages incharge
Cashiers

Production Different plans

Inputs
Department Output

Maintenance Services
Maintenance
Department Custodial Services

Utilities

Occupational
Check Quality Health & Safety
Liberty Check weight
Department Facility Bookings

Gas control
Power House Electric control

Department

Electric
Department

Workshop
Department

Dyeing Cotton dyeing

Department
4.1 Factors for Production in Spinning Mill
In every factory, production efficiency defends on some factors or
parameters. As like as other factory, production of Spinning mill defends on some factors.
The factors which influence the production of spinning mill are mentioned below:

1.Raw material
2.Labour
3. Machinery
 Ends down
 Doffs
 Creeling
 Bobbin size
4.Maintenance
5.Energy issue

Raw Material
Raw material has an important impact on yarn quality and production.
Let’s see how it affects on yarn production? There are many parameters through which we
can easily assess the properties of cotton; first one is the fiber length which is the most
important characteristic of cotton and is measured in terms of staple length, span length
and effective length. If fibers have good staple length it results in the form of high
production because less twist per inch is required to give enough strength. Second one is
the short fibers percentage; higher percentage of short fibers will result in the form of
production losses due to more end breakage and higher twist per inch. Third one is the fiber
maturity, in case of immature fibers it results in the form of production loss because the
yarn made from these types of fibers have poor strength and also it produces breakage in
spinning department. Fourth one is the fiber strength which is the dominating feature of
fiber. When fiber strength is higher it outcomes in the form of high production due to less
twist multiplier. I think while choosing cotton we have to keep in mind all these factors
otherwise it results in the form of great loss.

Labour
In all industries, the importance of labour cannot be denied. But in the
textile sector specially in spinning mills labour plays a very crucial role because without
their participation nothing could be done. For example if we take the example of the ring
department in a spinning mill or you can say the production department, 400 workers are
working in one shift and with their negligence it 28 results in the form of production loss.
In the ring department we can calculate production in bags /day, so, with the workers
carelessness it results in the form of loss of bags training sessions for their improvement
and the most important thing is to increase their wages time after time. By adopting these
things productivity can be improved.

Machinery
Machinery is the back bone of every industry. In the textile industry
machine are working 24 hours so it is important that its efficiency would be excellent.
Let’s look at the comparison between the old and new machine. In Spinning Mills we
analyzed that, “why new machine are better than old machine?” In the simplex department
they have erected 10 frames and in which one of them is the old one. If we compare the old
machine with the new machine in production point of view then, it is clear that new
machines are better than old ones. We got some experimental results, from the new frame
with the speed of 725 rpm the production is 45 bags/day while with the old machine with
the same speed production is 35 bags /days because many factors involved in it like sliver
and roving breakages, machine adjustments and stoppages. If we compare these machines
in energy point of view then old machine consumes more energy than the new ones. From
the above discussion it is clear that the machine matters if we talk about productivity.

While analyzing in Ring Department, during working stoppages may occur due to the
following reasons.
 Ends down
 Doffs
 Creeling
 Bobbin size

These factors affect the productivity to a great extent. If we control these stoppages then
production can be increased and it also has an impact on yarn quality which is improved
under the same conditions of cost and labour charges.
Ends Down
The end down is due to the less strength of yarn and greater spindle
speed. Adding to stops, no. of spindles per frame, lift of bobbin rail and cleanliness of the
department also affects the production. More number of spindles on a frame increases its
efficiency. Cleanliness means no fibrous mass is floating in atmosphere of ring otherwise
ends down rate will be increased.

Doffs
Doffing means removal of full size package and replacing it with the empty
one. During doffing, the machine is stopped and it is carried out by skilled workers. For
coarse count like 7s, 10s etc, doff time is less and for finer count like 30s, 40s etc, time is
more. For 20S it takes 90-110 min for complete doff. During doffing, it should be kept in
mind that it should be carried out in the shortest possible time.

Creeling
The changing of the roving bobbin when it is empty and to replace it by a
new full roving bobbin is called creeling. Creeling time should be as small as possible.

Bobbin Size
The production can be increased by increasing the bobbin size because with
a bigger bobbin less doff is required per shift. The Bobbin size depends on ring dia, but as
we increase the ring dia, ends down rate also increases so it also has a limit. Usually 42
mm ring dia is available on which 40 mm dia bobbin can be prepared.

Maintenance
Proper maintenance of machine is necessary otherwise it results in the
form of many problems like sudden shut downs and big production loss. In ATM
maintenance is done on daily basis to overcome the problems which they are facing every
day. Usually in ATM one machine is opened 30 in every department for maintenance.
Proper maintenance results in the form of efficient working of machine and good outputs.
For example by proper maintenance and by proper preparation of roving it results in the
form of minimizing the end breakage rate.

Energy Issue
Energy is the basic requirement of any industry but now a days in
Bangladesh it’s a big issue right now that’s why the textile industry is suffering from many

problems. Now take a look and discuss what kind of problems they are facing and how
they create hurdles for productivity? Bangladesh industry is mainly running on these two
resources i.e. gas and electricity. But due to shortage of these necessities many textile units
are shutting down. Sometimes due to sudden failures machine parts are being destructed.
The second and most important problem that arises is that the products are not being
prepared in time for delivery which causes customer and production loss as the products
are not being produced on time. For instance if one spinning mill has a production of 300
bags/ day due to shut down of 2 hours, its production is going to decrease by 275bags/day.

4.2 Spinning Process

Spinning is the process of combination of all processes which are
involved in conversion of fiber into yarn. In textile when we say spinning then we mean to
say about the final process in the transformation of fiber into yarn or thread. The object of
spinning and of the processes that precede it is to transform the single fibers into a cohesive
and workable continuous-length yarn. In spinning process the most important thing is fiber,
which is the base of thread/yarn and thread/yarn is end product of spinning departments
given below:

Mixing Section

Blow Room Section

Carding Section

Combing Section

Drawing Section

Simplex Section

Ring Section

Auto cone Section

Conditioning Section

Packing process Section

Deliver to Customer
I. Mixing Section

Mixing section is basically designed for the purpose of mixing

different lots, because these lots are purchased from different regions and areas and contain
different colors, shades and brightness ranges due to following factors,
• Moisture
• Weather
• Picking condition (manual or mechanical)
• Treatment during transportation

Objects of Mixing Hall

• Cotton Opening
• Mixing
• Removing of foreign particulars like jute, and pieces of cloth etc

II. Blow Room

The cotton is received in blow room through condensers from the mixing
section. In blow room this cotton is stocked for 12 to 16 hours for conditioning according
to the temperature of blow room, in the form of layers horizontally and cut vertically which
is very old method of mixing the cotton of different regions and characteristics. This
process is called Sandwich Process and this way is Conventional way of mixing. All
wastage extracted in the blow room is called trash.

Objects of Blow Room

• Mixing
• Opening (tuft to tuft)
• Cleaning (up to 60%)
• Lap Formation
III. Carding Section

In carding section laps are converted into sliver. In carding machines laps
are feed and slivers are received as an end product in cans or boxes.

Object of Carding Section

• Mixing
• Opening (fiber to fiber)
• Cleaning (about 99% of whole spinning process)
• Sliver Formation
• Drafting
• Elimination of Short fibers (about 1%)
• Sliver formation

IV. Combing Section

In this process short fibers are removed and wastage of combing is

called "Comber Noil" 20% of lap is extracted or removed in the form of Comber Noil
during combing process. Combs are feeded in comber machine to do this process. Lap
received from lap former is its input while its end product or its output is sliver, which is
called here "comber sliver".
Objects of Combing Section

• Removal of Short Fiber

• Doubling
• Sliver formation

V.Drawing Section

Drawing is a process in which different slivers are combined together to produce single
sliver. Normally 8 slivers are fed behind one drawing machine and get an end product in
form of single sliver in cans or boxes, which has the same weight as of single sliver. The
purpose of doing this is that to create uniformity and average out the weight of each sliver.
This process is also called 8/8 process

Drawing section consists of two sub-sections:

i) Breaker Drawing
Objects of Drawing (Breaker)

• Uniformity
• Parallelization
• Orientation
• Dust removal

ii) Finisher Drawing

VI.Simplex Section

Finisher sliver is input of simplex machine while "roving" is its

end product. Roving is a big bobbin having refined sliver (in the form of package) but thin
and slim than sliver. In this process, twisting is done on roving. Here the twist per inch
(TPI) is approximately 1.004. Roving is further used in "Ring Department" for making of
small bobbins after that making of cones. One package normally contains 3,000 meters
roving.

Objects of Simplex Machine

• Drafting
• Twisting
• Package formation (conversion in roving from sliver)
VII. Ring Section

In ring section, final spinning process starts. Here in this section roving from simplex
section is turned into fine & sophisticated yarn of different counts. Pulling effect makes
counts. Spindle is a smaller tapering rod, the rotation of which gives the twist and around
which the thread is wound as it is twisted. These bobbins are further sent to the Auto
Winder or Auto Cones department, where cones are made from them.

Objects of Ring Section

• Drafting
• Twisting
• Package formation (conversion in roving from sliver)

VIII.Auto Cone Section

We installed new 21 C Process Coner. We are producing yarn

having low level of contamination. It is a fully computerized system
and helps to determine departmental efficiency round the clock. Yarn
hairiness is controlled on 21 C Process Coner by its special balloon
system.
IX. Conditioning Section
After making sure the proper condition is met, the proper
conditioning time must be determined. Conditioning time is effected by several
factors.

Control Constancy
The ability of the conditioner and controller to maintain a
constant control at the control sensor location

Sensor Accuracy

Calibration uncertainty of both the temperature and relative humidity sensors

Uniformity
Stratification throughout the conditioned space caused by
insufficient air flow, heat or moisture loads within the space, or leakage to or from
an adjacent space

Conditioning Time
the amount of time a sample takes to come to equilibrium
at the specified condition.
X.Packing Section

Finally cones are sent to packing section where these cones are
thoroughly examined under "ultra violet lights". Contamination is checked after that cones
are kept in the controlled temperature of packing hall for 24 hours for conditioning. Then
these cones are packed in cartoons, after wrapping in polythene bags. 24 cones are packed
in one cartoon and 15 bags are packed in one plait.
XI.Deliver to Customer

After the packing deliver to the customer by order main branch of Azgard9 Ltd.
Lahore

5.1 Planning Process and Tools/ techniques

5.1.1 Product Development (PD)

First of all OCS (Order Confirmation sheet) is received from merchandiser,

which is attached with following details, which are as follows;

 Customer specification A/W sheet.

 Cutting details.
 Packing details.
 Approved trim cord B/W and A/W.
 Original sample which is valid for styling.
 Thread and washing details.

After receiving OCS the PD department send MS (merchandising sheet),

which is also known as work order sheet to MMC (Merchandiser Material Control)
department.

It is basically a procurement or purchase department. This department then

purchase and provide the material listed in the MS sheet.

nd
The 2 main function of PD department is to issue the Technical sheet
which is also known as production sheet. This Technical sheet describes every
single complication in the order.

Many Technical problems are solved and explained in this sheet. The
technical book contains the following contents:

 Style summery
 Stitching standards.
 Accessories standards.
 Packing standards.
Customer specs MS.

5.1.2 Production Planning Control (PPC)

The main function of PPC is to plan from booking to shipment and giving the
final dates to the marketing department for the completion of orders.

In this process the confirmation of order is first received from marketing

department with order number and desired date for completion. PPC department
receives availability report of goods and trims from the supply chain department. If
there is any shortage of fabric or before wash (B/W), after wash (A/W) accessories
then PPC demands estimated date for the availability of trims and fabric from MMS
(Main & fabric store) department for the procurement of goods .Then PPC
department make analysis of the capacity of the all operations in the company and
then give their possible date of completion to the merchandiser with the addition of
few days to the calculated completion date as a factor of safety.

If there is much difference between the desired date of merchandiser then

marketing department negotiate with customer and the date is then finalized .It is
PPC department which defines the targets for all the functioning departments on
daily basis also.

For this purpose a graphical chart is made which tells the starting and
completion time of stitching operation. This chart can be based on coming 2
months or more depending upon the load of orders. The chart on next page
shows it clearly.

The main functions of PPC are:

  Potential Planning
 Departmental Goals
 Time and Action Plan.

5.2 Organizational Structure and Design

Organization Structure designates formal reporting relationships. It identifies

the grouping together of individuals into departments and of department into the
total organization. It includes the design of systems to ensure effective
communication and coordination across departments.

Organization Structure
 Employees of AZGARD
NINE GROUP
Clear

skills, Direction

Shift In
competency,
CEO charge
new

-
Performance,achieve targets
Business Unit Senior
Manager Superv isor
Values,

General Manager Supervisor

Vision,
Manager Asst Supervisor
Mission
, Skilled Workforce
Assistant Manager
Management Trainee Goals Un-skilled Workforce
Management Staff Non-Management Staff

Human Resources Depa rtment

5.3 Communication

In Azgard9, there is paper-less communication. Communication plays a vital role in

daily routine of Azgard9 culture. The means of communication used by the
management are: Office telephone extensions, E-mails, Notice boards.

How to get information regarding Office telephone extension?

There are two main sources from where information can be obtained regarding
office telephone extensions i.e. Consult the Telephone list in your department or
Dial “0” to talk to company operator for further details.

How to get direct dialing from operator for official works?

The direct dialing from operator for official work can be managed through dialing
“0” from the office extension. Please note that mostly we dial “0”; the operator will
attend your phone; provide your information regarding your name, department and
office extension; the operator will ask you to hold; operator will dial the number and
direct you to talk. The maximum period for one call is restricted to 5 minutes due to
pressure of calls on telephone lines / telephone exchange. Please show patience
when dialing the operator.

How to create E-mail account?

To create the E-mail account of an employee, the employee will communicate the
name, designation and department with the Information Technology (IT)
department. The employee has to fill the “User Account Creation Form” to activate
the Login name and E-mail address. E-mail shall be provided if recommended by
Head of Department (HOD), otherwise only Login name will be created for the
employee. Those employees who were recommended to get E-mail address shall
submit the “User Account Creation Form” to IT department and the System
Administrator will activate their E-mail address.
How to use Microsoft Outlook for E-mail?

Major applications:
1. Send / Receive E-mail
2. Address Book
3. Create Signature
4. Attachment of file

Consult Key book at IT department

Where IT department is located?

The IT department is located on the first floor near Managing Directors (MD) room.

IT Support Services Extension no # 125, 225

Extension no # to confirm the purchase of system: 325

Where main notice boards are located?

There are two main notice boards for administrative information located in the
garment passage hall. There are two directions to reach the notice boards. Firstly,
enter the garment gate, pass the IN/OUT machine, walk ten (10) meters and you
will find the notice board at your right hand wall. Secondly, enter the reception gate,
pass the reception, enter the tunnel passage and turn to your right or left at the end
of the tunnel passage. You will find the notice board pasted on the adjust walls.

However, there are departmental notice boards located in each department to

paste their information. The further departmental notice board information can be
gathered from the respective departments in detail.

What are the major information’ communicated by the means of Notice board?

The major information regarding Gazetted holidays, announcements, policies and

administrative matters are communicated through two major notice boa
5.4 Motivational Techniques Used

Pay increment is being provided not on experience basis but on

performance basis. Also there are lists of benefits which are being provided to
employees to increase their productivity level.

Employee Benefits Highlights

• Foreign
• Incentive Scheme Training Trips • Residential
(On achieving tar gets) Colony
• Performance Based
• Provident Fund Annual Increments
Scheme
• Variable Pay
• Group Scheme
Insurance • Car Scheme

• Health • 32 leaves per

Insurance annum

• Pick and Drop • Company Loan

Facility Facility
• Company Paid • Recreational
Mobile Phone Subsidized Trips
Lunch Facility

Human Resources Department

5.5 Controlling Authorities

Managing Director (MD) and General Manager (GM) are the controlling
authorities over there.

5.6Control Approaches Used

Personal

observation

Statistical Reports
6. Structure, Design and Issues
6.1 Divisions and Groups of its businesses

 Specialized Yarns
 Denim Fabrics
 Denim Garments

6.2 Azgard Businesses Include

 Azgard 9 diversified into this sector by acquiring PAFL from

Government of Pakistan in 2006. The unit manufactures ammonia &
urea.
 Azgard Project Management &Engineering Solutions manages two
power Plants, which provide maintenance & support services.

6.3 Geographic Distribution of Azgard

 Garment business unit (Manga Site)

 Garment business unit (Ferozpur Road/ FPR)
 Spinning Unit (Muzaffar Garh)
 Pak American Fertilizers Limited (Mianwali)

External Environment: As Azgard9 deals with the foreign market only. So the
company strong competition with its foreign competitors.

6.4 Decision Making

GM and MD are involved in decision making. And also head of the departments
take part in formal decision making.

6.5 Conflicts and their Resolution

Being formalized organization, all the disputes and conflicts are sent to the
next higher authority in the hierarchy. And authority decides its resolution.

6.6 Power and Politics

Power is in hands of top management like higher authorities. There is no any

concept of employee empowerment. Politics exists everywhere in the company. No
employee can escape from that politics. Leg pulling is also there.
 7. Strategies and Analysis

7.1 Competitive Strategy

 Better performance
 Providing value added products
 Providing on demand washing effects
 Adopted pull and push strategy
 Providing better products at lower rates

7.2 Marketing Strategy

 Firstly improving own product

 Better research & development
 Product innovation
 Reasonable price against market
 Smart and excellent outlook of garments
 Using price strategy for youngsters

7.3 SWOT Analysis

Strengths:
 Vertical Composite Unit
 Multinational Company dealing with worldwide big brands (e.g.:
H&M, Diesel)
 Unique washing and dying
 Two power supply units

Weaknesses:
 Health and safety Environment problems
 Manual cutting
Opportunities:
 Company is going to launch a new local brand in 2009
 TQM Implementation is one of its big opportunities.

Threats:
 Competitors ( CBL, US Denim)
 Political instability in Pakistan

7.4 Financial Analysis

The challenging trading conditions have a great impact however the

performance of Azgard9 shows a healthy growth trend. However the increase in
finance cost was greater than the growth in income which significantly affected the
bottom line. The rapid increase in the finance cost is basically due to the
devaluation of the Pak Rupee. Company had borrowings in foreign currencies
either directly or indirectly thus effecting the finance cost very badly.

Performance

 Equity of company is Rs. 10,317,920,684

 Production reached 5 million tons, approximately.
 Sales Rs. 10,113,499,351 which is 53% change as compared to last
year
 Profit after tax is Rs. 897,283,923 which is 17% change as compared
to last year
 Having total assets of Rs. 29,600,032,254

Goals

 Continue with its low pricing strategy

 Keeping sufficient margins
 Further enhancing the product and services portfolio
 Ensuring seamless business process interaction with the customers
 Create a highly integrated supply chain
 Enhanced customer loyalty and value creation
 8. Core Internship Experience

Being a marketing internee, I was assigned a task related to marketing

practices. Here firstly I am going to discuss briefly whatever I learned over
there regarding other marketing practices.

Marketing department is the key department of the organization and half of

the success of the business depends upon the activities of this department
because this department has direct contact with the customers.

Marketing department deals with two types of markets

 International Market
 Local Market

8.1 Hierarchy of Marketing Department

Hierarchy structure if the marketing department is as follows:

8.2 Export Section

Azgard has local market as well as export market; therefore the major job of
all the marketing managers is defined. The major steps, which are involved in the
process, are as follows.

Broadly categorized there are two types of customers:

8.2.1 Direct Customers

Direct customers are those who directly import the yarn from Azgard. These
types of customers enjoy the low prices because of the fact that there is no
commission involved in that case. In this type of correspondence there is no
intermediary.

8.2.2 Agent Customers

In this aspect there are three possibilities

1) Pakistani agent is involved

First possibility occurs when a local agent has some direct customer in the
local country and that agent contact with Azgard. The commission paid to
the agent is added to the cost. The commission ranges from 2% to 3%.

2) Foreign agent is involved

Second possibility occurs when a foreign agent has some customers in his
country and that person is in direct contact with Azgard. The commission in
that case is also added to the cost. The limit of that commission ranges 2%
to 3% according to the amount of the invoice. The percentage depends upon
the profit margin which is given by the customer.

3) Pakistani as well as foreign agent is involved

Third possibility occurs when a foreign agent has some customers and that
agent had no direct link with the company but with a local agent who have
direct link with the company. In this case the maximum commission for both
the agent is 4% which is distributed among them by mutual understanding.
8.2.3 Production Mix

Product
Azgard9 produces high quality yarn. It exports in foreign markets, sells in
local markets and along with that uses a major portion of its yarn in its own
garment department. All products are produced according to the requirements of
customer orders.

Price
Pricing is an important factor in the marketing process for any company. The
price policy of the company should be in such a way that it should produce a
reasonable profit, for the company and should satisfy the customers.

Place

Azgard9 is using two types of distribution channels

1) Direct
Azgard Nine Limited Customer

2) Indirect
Azgard Nine Limited Middle Man (agent) Customer

Promotion

As the yarn is an industrial product, middle man (agent) plays a major role in
selling the yarn. However on the other hand the marketing department personally
contacts the customers and sells the product. Therefore personal selling is a major
promotional tool for Azgard’s marketing department.

8.3 Local Sale Section

Local sale section deals with the sale of yarn in local market. Therefore
manager local sales deal with the local parties for product selling.
Execution of Sales Process

For the sale in local market first they check industry rates and then they
began bargaining with the customers. The manager sets the rates with the parties
and terms and condition also by both the parties so in this way a contract is signed.

 Buyer Name
 Seller Name
 Product Specifications
 Price
 Delivery Time
 Place etc

Commission is also set by the company with agent if the agent is involved
here. Then order is given to the production unit confirming the date of destination
etc. So in this way local sale is done.

9. Conclusions

Being an HR internee in Azgard9, I would like to mention that Azgard9 provide us a

great opportunity to learn practical knowledge. Azgard9 is a well reputed and a big
garment company in the textile sector. I really enjoy a lot while doing work over
there. Supervisor and managers of the department help and guide me a lot. One
thing which I find missing over there i.e. strong communication between
departments. Politics exists everywhere.
 10. Recommendations

There is a need of strong communication within each department and

between the departments.
Locate all the sub-departments of HR at same place. It will help to
increase coordination between departments.
There should be separate uniform for workers of each department within
a specific business unit.
Attendance procedure should be more appropriate. Finger prints should

be taken from the employees.

Internees should be free to visit all departments.
There should be proper equipment provided to employees and workers to
prevent noise pollution and dusty areas. The workers should be strictly
bound to use these equipments.
Stipend should be given to internees.
There should be separate equipment for Training room.
There should be separate cafeteria for female

employees. There should be proper mosque for

employees.
 11. Bibliography

 http://www.azgard9.com/html/financial-information.htm
 http://www.azgard9.com/html/Security-Analyst.htm
 http://www.azgard9.com/html/financial-
info/2008/Security%20Analys_g%20-%20Q1.pdf
 http://www.js.com/pakistan-financial-news-latest_75.asp
 http://www.pacra.com/
 http://www.brecorder.com.pk/index.php?currMIndex=16&currPageNo=1
 12. References

 (Business Development Manager, Azgard9)

 (Business Unit Manager, Azgard9)
 (Deputy Manager Marketing, Azgard9)
 (Business Manager, Moody International)
 14. Glossary

Azgard9 Azgard Nine Limited

CEO Chief Executive Officer

COO Chief Operating Officer

E-mail Electronic Mail

HOD Head of Department

IT Information Technology

LC Letter of Credit

MD Managing Director

PAFL Pak American Fertilizers Limited

PPC Product Planning Control

WIP Work In Process

MCBL Muslim commercial bank Limited