Summer Internship Report

Organizational Study A study conducted at Facil Internet Technologies Private Limited

BY:

Prasanna B III SEMESTER, MBA 11MB8607

Guide Name NSB

Summer Internship Report

Project Report Submitted to the University of Mysore in Partial Fulfillment of The Requirements of III Semester MBA Degree Examination 2011-13 NSB School of Management Studies Bangalore - 560068

TITLE OF THE PAGE

Summer Internship Report

NSB School of Management Studies Bangalore-560068

Date:-

CERTIFICATE

This is to certify that Prasanna B student of III Semester MBA course has prepared this report entitled Organizational Study , Mysore in Partial Fulfillment of the Requirements of MBA Degree examination of 2011-13.

Summer Internship Report

Azam Illiyaz Placement Director

NSB School of Management Studies Bangalore-560068

Date:-

GUIDE CERTIFICATE

The project report titled Organizational Study is submitted by Student Name under my guidance. This report is submitted to the University of Mysore in partial fulfillment of the requirement s of III semester MBA Degree examinations of 2012.

Prof.

Summer Internship Report

(PROJECT GUIDE)

DECLARATION

I ,Prasanna B student of II semester MBA,NSB School of Management Studies Bangalore, hereby declare that this project Report, entitled during the year 2012 has been prepared under the valuable guidance and supervision of Prof. ,toward the fulfillment of the requirement for the award of Masters Degree in Business Administration, University of Mysore.

I further declare that this project report is a result of my own efforts and that it has not been submitted in part or in full to any other University or Institution for the award of any degree or Diploma. Place: -Bangalore Date: Prasanna B 11MB8607

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CHAPTER 1 INTRODUCTION

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Introduction:
Organizational Study is done in order to know about the operations of an organization structure, vision , mission and services/products offered by a organization. Also organization should also cover the various departments of an organization. This is because in order to know about an organization. It helps to see how theoretical concepts are applied practically and this report also gives a significant importance to market research since the main part of focus is market research on payroll process which is also a comparative analysis. Market Research is done in order to find out the potential market for a companys product or services. This is mainly to find out whether the product or service will be able to gain a part of market share. Also market research helps the company to find out the expectations of consumer from a service. A research is done in order to acquire knowledge similarly market research is done in order to find out the consumer behavior, macro and micro environmental factors that Influence the success of a service. Generally a Research has different steps namely Identification of research problem Literature review

Summer Internship Report Specifying the purpose of research Determine specific research questions or hypotheses Data collection Analyzing and interpreting the data Reporting and evaluating research Similarly here A Study on Comparative Analysis of Market Research Payroll process is market research that helps to in order to get complete knowledge about industry structure, market potential, Consumer behavior and segments to focus on future. Generally research is based on a hypothesis. This market research is based on the hypothesis of a payroll process. . variables. There are two kinds of hypothesis namely A hypothesis is a testable statement that gives the relationship between two or more

1. Null Hypothesis 2. Alternative Hypothesis

A null hypothesis is a statement that is given to prove that there is no statistical significance between two different variables. The following is an example of null hypothesis Mr VB sees that his investment strategy produces higher average returns than simply buying and holding a stock. The null hypothesis claims that there is no difference between the two average returns, and Chuck has to believe this until he proves otherwise. Chuck sees that his investment strategy produces higher average returns than simply buying and holding a stock. The null hypothesis claims that there is no difference between the two average returns, and Chuck has to believe this until he proves otherwise.

Summer Internship Report The alternative hypothesis for the following statement is the investment strategy gives him the maximum return. Alternative hypothesis (or maintained hypothesis or research hypothesis) is the opposite of the null hypothesis. It is the main thing that is useful to conduct research. Hypothesis testing is done on the basis of both null and alternative hypothesis. market research the following is the hypothesis given Objective: To find out whether there is a market for payroll outsourcing Null Hypothesis: There is no market for Payroll Outsourcing. Alternative Hypothesis: There is market for Payroll Outsourcing. Here in this

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CHAPTER 2
INDUSTRY PROFILE

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Industry Profile
A company is small unit of the economy. An Industry is a combination of two or more companies. Here a simple example can be given Maruthi Udyog Limited is a company that manufactures cars. The entire Industry is known as Automobile Industry. Similarly Facil Internet Technologies is a company. It comes under the Human Resource Services Industry. The industry name itself shows the function of this industry. This industry has gained more reputation because of increasing business complexities and growth of various industries and business enterprises. There are different services offered by HR services these are mainly classified into Temporary Recruitment Permanent Recruitment

Summer Internship Report Other Segments

Temporary Recruitment consists of three different sub categories namely Professional Staffing General Staffing White Collar General Staffing Blue Collar The first category is Professional Staffing skilled professionals in the IT and Engineering. General Staffing White collar is a category which provides skilled labor On the payroll of large companies in ITES, Retail and Telecom Sectors. General Staffing Blue Collar is a category which provides employees to various Factories and plants. The following is the different players in the temporary recruitment market. Key players Team Lease Manpower Adecco Mafoi Ikya, Kelly Allegis WDC and Future Focus it is particularly for technically

The market worth of temporary recruitment is INR 172 billion which consists of professional staffing market which has a value of 59 billion INR and General Staffing which has a value of INR 113 billion .

Permanent Recruitment consists of two different categories namely

Summer Internship Report Search Recruitment Search is done in the levels of CXO and top management and recruitment is done for middle and junior level employees of an organization. The following are the key players in the search market o Egon Zehnder o Heidrick &Struggles o Russel Reynolds, o Spencer Stuart, o Korn Ferry and o Transeacrh Amrop

The following are the different players in the recruitment market

Key players: o ABC Consultants, o Mafoi And o Kelly

The market value of Search is INR 6-7 billion in Financial Year 2011 The market value of Recruitment is INR 23-25 billion in Financial Year 2011 The following are the other services that are provided by different companies in HR Services industry namely o Payroll Administration o Employee Training o Resume Writing o Back Ground Interviews and Benefit Consulting o Online Job Portals

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The other segments contribute only to a small percentage of HR Industry Growth exactly 14% of the whole industry

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14 Temporary

13 Permenant 73

Others

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73% of Market size is occupied by Temporary Recruitment 13% of Market size is occupied by Permanent Recruitment 14% of Market size is occupied by Other Services. The majority of market size is occupied by temporary recruitment. This is because of the global economic slow down many companies wanted to have minimum bench strength in order to maintain its competitiveness.

Growth rate of HR Industry:

The next thing that is to be considered while analyzing a industry is to have a idea of growth rate of the industry. Similarly here the growth of the HR services Industry is analyzed in a

brief manner. This is because the particular segment of payroll process falls under this industry. And also the analysis of the industry also helps to find the growth level along with the potential of the market.

Here in this market research this analysis of industry is much useful because the growth of an individual company depends on the growth of the entire industry. To Have a clear understanding of growth rate generally diagrams and graphs are used to depict the growth . Because symbols and pictures are much more effective in communicating results to the end users. So here a line graph which shows the growth of the industry.

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250

200

150

228 100 170 202

127 50

0 FY 08 FY 09 FY 10 FY 11

Note: In this Graph the X axis denotes the financial year and the Y axis denotes the market value in Billion Indian Rupee

Summer Internship Report

The following diagram shows the market growth of HR services Industry. The market size of HR Services Industry in FY 08 was 127 Billion INR and the market size in the year FY2011 228 billion. Though the initial growth of HR Services Growth is very high later it declined. The initial growth was 33% at FY 08 and the growth at FY11 was 12%. Though the value of market is increased from 127 billion INR to 225 billion INR the growth rate is reduced this is mainly due to the global economic slowdown that caused a decline in industry growth and which in turn affected the overall employability,expansion etc.

Payroll Processing:
Payroll processing comes under other services of HR Services Industry. Payroll processing services are gaining significant importance because of increasing complexities in business and high expenditure on HR and Personnel. Payroll is the Salary of employees working in an organization. Payroll is Computed by making certain deductions and also adding allowances. In order to process payroll Certain statutory regulations must be known. This is because certain deductions are to be made according to the legal regulations of the central and state governments Generally the following deductions are made from a persons

salary/compensation of an employee they are Professional Tax Income Tax Provident Fund

Summer Internship Report ESI

Professional Tax
Professional Tax is the subject of State Government. The following is the Professional Tax that is prevailing in Karnataka

0- 10000 10001-14999 Above 15000

Nil 150 200

There are certain states without professional tax Rajasthan Delhi and Union Territories

Income Tax:
Income Tax is a tax levied by the Government of India .This tax is levied on the basis of Income Slabs. This is a tax that is levied by the central government The following table shows the income slabs along wit the tax rates

Provident Fund:
Provident Fund is the deduction made from an employees salary structure.

Summer Internship Report A company is eligible for provident fund if the number of employees is at least 20. 12% is deducted from the gross salary. And the amount is deposited in the Employee Provident Fund Account. This is beneficial because Employees are eligible to get loan from PF account after five years. Also the legal heirs are eligible to get financial compensation in case of death of the employee. After 10 years the employee is eligible to get pension.

ESIC:
Employees State Insurance Corporation is a organization which is much helpful to the employees. The employees are eligible to get medical benefits under this scheme. The employee is eligible to get into ESIC Scheme If the monthly income of the employee is upto Rs 10000 . The following is the contribution that is to be made by the employeer and employee 1.75% from the employee 4.75% from the employer

Tax Deduction at Source:

This is also a kind of deduction that is to be made on the employees salary structure.

Apart from deductions certainly there are certain allowances that are to be made. The following are the different kinds of allowances that

Summer Internship Report Basic Pay HRA(House Rent Allowance) Dearness Allowances City Compensatory Allowances Arrears Bonus and Incentives Generally these are the things which are to be considered while maintaining the payroll in a company or business enterprise. There are three different kinds of payroll maintenance namely Manual Payroll outsourced to a Vendor Maintenance of Payroll

Manual Payroll process:

A manual process is one which a companys HR manager/contact person maintains the payroll of the company by using manual methods. This also includes usage of spreadsheets like excel, and common accounting software like Tally.

Payroll outsourced to vendor:

Some companies have their payroll outsourced to vendors or payroll service providers who takes care of the payroll process of the companies. They produce Payslips on the basis of information provided by their clients.

Payroll Software

Summer Internship Report Companies which are of large size is capable of having their own payroll software. Also sometimes large companies have the capability to build their own software for their payroll process. Generally there are two kinds of payroll softwares namely Online Payroll Software Offline Payroll Software In a online payroll software the employees are capable of accessing their payslips through websites. Offline Payroll software is a one software for which access is restricted to other people. Outsourcing is a process of contracting out the business process. Similar to this the payroll of a company is outsourced to another company which is specialized in managing payroll this is also called as payroll outsourcing. There are different companies that are doing payroll process. The following are the main advantages of payroll process outsourcing namely Economical Time Saving Avoids Penalties Can concentrate on their main business activities

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CHAPTER 3 COMPANY PROFILE

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Company Profile:
Now in chapter 3 we do come to a company profile. Generally a company, firm or a business enterprise comes at the bottom level of an economic importance. A company is a micro segment of a economy. Every company has its own profile with its own products/services vision mission and the strategy management structure and standard operating procedure(SOP). Fa`cil Internet Technologies Private Limited has its own vision and mission strategy objectives and management structure. Here in this report we are going to see the profile of the company from which the study was conducted. Facil Internet Technologies is a leading technology organization founded by seasoned management professionals and alumnus of IIM and headquartered in the Silicon Valley of India, Bangalore. Facil aims to make technology affordable, convenient and scalable for Enterprises, Small and Medium Enterprises (SME) and Consumers with an Outside-In Approach. The Outside-In Approach is aimed at creatively delivering value to customers through Customer Centricity and Customer Intimacy through Collaboration and thereby maximizing long-run shareholder value.

The following Diagram depicts the four pillars which Facil Internet Technologies operates namely

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Value Creation:
Value is a term that is used in corporate world. Enterprises today aim at providing maximum value for their customer by providing products/services which are of superior quality. Facil also aims at maximizing value to the customers by providing superior quality of services.

Innovation:
Innovation is the creation of better or more effective products, services

Strategy & Execution:

Strategy and Execution are the two important things that are must for a business enterprise to be successful. At Fa`cil the management team is responsible for formulating good strategy. Similarly after strategy formulation the execution is very important .Fa`cil has a very good.

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Quality:
Quality is also a very important factor for success of a service in the market. The service or product must have quality. Also the service should be rendered at time to the clients/customers

Organizational Chart:
Organizational chart is the way in which the management of a company is structured. Generally the organizational chart/hierarchy chart is designed mainly on the basis of two parameters namely Nature of business Size of the organization. In case of a FMCG company the organizational structure is separately on the basis of product categories. In Facil Internet Technologies the organization structure is designed in outside in approach this is because the company believies that the customer is the key to attain business Objectives. The Board, CEO Senior and middle level of management are assigned to the customer in order to make the things done for them. designed

Summer Internship Report

As Facil is a startup it is a having a Flat organization (also known as horizontal organization) hierarchy which means only few or no levels of intervening management between staff and managers. The idea behind is that welltrained workers will be more productive when they are more directly involved in the decision making process, rather than closely supervised by many layers of management.

3.2 Advantages
Customer-Centric Focus
People who service customer needs understand who the target audience should be, what their needs are, how they view pricing, and how to sell the product. In a flat organization, managers are brought into the process

Summer Internship Report of accomplishing work for clients while workers are asked to make more decisions, bringing them more into the management arena. A flat organization moves everyone closer to the customer so that everyone understands the needs of those people using the product or service.

Employee Empowerment
Less managers mean that in many cases, employees need to be able to make decisions without intervention from a higher layer of authority. More training of employees so that everyone better understands how a company can achieve its goals and keep customers happy. In the long term, employees are freer to service the customer as they'd like, which leads to higher retention of employees with higher job satisfaction and also more satisfied customers.

Flexibility
Organizations relying on a flat structure need to cross-train employees to fill in for others quickly when special situations arise. This cross-training makes the organization more reflexively when problems arise, and creates a speedy growth business, which is able to solve customer problems and fix any complaints that arise faster than a traditional organization.

Accountability
Often in a traditional operation it's easy to "pass the buck" to another employee. Because a flat organization needs well-defined areas of focus, employee accountability is much higher. This makes it easier for managers to assess strengths and weaknesses of employees and look for sales or efficiency opportunities in the system.

Cost
A flat organization is less costly because there are less people in the management chain and more persons touching the end product or service. Cost per piece of product falls dramatically as layers of management overhead are reduced. New hire training costs also lower as retention levels increase.

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3.3 Disadvantages
Confusing Leadership
In a flat organizational structure, the layers of leadership are few but leadership tends to be more organic in nature. Since managers are on equal footing and involved in the same projects together, they may give employees different tasks in a confusing manner. Unless the process is very clear, an employee may be trying to work for two bosses at the same time, leading to confusing and contradictory instructions.

Limited Structures
Flat organizational structures can only last so long. As a business grows and eventually goes public, the flat structure cannot stay. A public business needs a board of directors to evolve into a corporation, and a more complex business structure to expand into multiple branches.

Employee Role Confusion

Just as manager roles can become confused in a flat structure, so can employee roles. An employee may go to work for a flat organization expecting to do one job, but find out that pieces of many other jobs are also required as needed. This makes it difficult for some employees to focus and specialize at their jobs.

3.4 Impact on Employees

Accuracy
Flat organizations do not have this issue as there are less layers or people for the message to travel across. Communication accuracy increases greatly in flat organizations.

Speed
Speed of communication is a big advantage for flat organizations. In a flat organizational structure, only one or two approvals are usually necessary and this speed allows new products and services to be implemented faster and with less red tape. Speed increases with fewer levels of management.

Ownership

Summer Internship Report Flat organizational structures produce a greater degree of ownership within an organization. Employees who are closer to the customer are more accountable for their decisions and can take action on the spot to please a customer. Your employees feel more empowered and responsible for their actions when they do not have to seek permission from several layers of management. Ownership of your employee's job duties is a major benefit of flat organizations. Employees act more like owners when they feel that their decisions affect the success and profitability of your company.

Effectiveness
Your employee's effectiveness also increases in a flat organization. Rules, regulations and reporting structures are much less complicated. Understanding expectations and assignments is easier when there are only one or two managers involved in supervising an employee or department. Conflicts between departments is reduced with a flat organizational structure and cooperation increases when everyone needs the assistance of others to succeed. Fewer layers of management allows your associates to operate with greater flexibility which leads to fewer conflicts and increased effectiveness for everyone.

Management Team:
MR. B. S. RAO Chief Executive Officer B S Rao popularly known as Srini, is a Seasoned Management Professional, Certified Lean Six Sigma Black Belt and a Certified Process Professional (CPP) with over two decades of rich and diverse experience in Strategic Business Management, Successful Start-ups, Business Turnaround's, Strategic Planning in the IT, Telecommunication Industries and Alliances, Management Consulting. Srini is an alumnus of IIM, Bangalore and holds a Graduate Degree in Computer Sciences and Triple Master Degrees in Management. In the past, he has headed organizations and managed businesses for Global Multinationals such as Singapore Telecom, Reliance Communications Ltd, GTL Limited and other leading groups in He is responsible for driving business strategy, vision, strategic customer relationships at Facil. Away from business, Srini is engaged in helping Orphanages, Deprived Urban, rural citizens and has been engaged in conducting medical camps for the deprived sections of society.

Summer Internship Report MR. RAJESH KUMAR Director Rajesh is a Serial Entrepreneur armed with an Bachelors Degree in Computer Applications with over seven years of experience in managing business, customers and stakeholders bringing customer delight through pro-active services and solutions. His Customer orientation has led to key wins in the Global and Domestic markets. He serves on boards of several leading and start-up organizations and is passionate about encouraging entrepreneurship in the country. At Facil, he would be overseeing the Technology, Strategic relationships. Rajesh takes a keen interest in Agriculture and Farmers, and apart from being an active Corporate Executive, he provides active support to the cause of Farmers by harnessing Technology and Knowledge management. He has initiated several Farmer Support activities as a part of the CSR initiative. Like other organizations Facil also has certain other policies on the following Factors CORPORATE SOCIAL RESPONSIBILITY Corporate Social Responsibility is a area in which all the organizations are concentrating.Many organizations do different kind of activities in order to enhance the society as a return to the society from which they earn their revenues.Facil also has certain measures in Order to show their Social Responsibility.

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Facil recognizes that its businesses should make an impact the earth communities and has designed CSR initiatives to help orphans, physically and mentally challenged,

Summer Internship Report orphanages and sponsoring medical camps for the deprived sections of societies in the urban, semi-urban and rural areas. Facil also has a strong commitment for Clean and Green Environment and has no tolerance for non degradable Plastic usage and other areas that add to environmental pollution. New initiatives are being designed to ensure adding value to the society we live and build a clean place for tomorrows generations. CORPORATE GOVERNANCE Corporate Governance is "the system by which companies are directed and controlled".It involves regulatory and market mechanisms, and the roles and relationships between a companys management, its board, its shareholders and other stakeholders, and the goals for which the corporation is governed. In contemporary business corporations, the main external stakeholder groups are shareholders, debtholders, trade creditors, suppliers, customers and communities affected by the corporation's activities[. Internal stakeholders are the board of directors, executives, and other employees Much of the contemporary interest in corporate governance is concerned with mitigation of the conflicts of interests between stakeholders. Ways of mitigating or preventing these conflicts of interests include the processes, customs, policies, laws, and institutions which have impact on the way a company is controlled. An important theme of corporate governance is the nature and extent of accountability of people in the business.

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Facil has a well-defined and enforced corporate governance policy under force addressing the financial, compliance and related best practices. The policy ensures adherence of ethical standards and best practices and covers the stakeholders such as customers, employees, shareholders, debtholders, trade creditors, suppliers and communities affected by the corporation's activities. The Corporate Governance at Facil is directed and controlled in a professional, transparent and responsible manner. The facts mentioned above give Technologies. us an Idea about Facil Internet

Services Offered:
Facil offers three services namely SPARK Startup Payroll and Risk Management Sevice this is a Integrated

Payroll Management Service(IPMS) and Integrated Accounting Management Services(IPMS) It provides a integrated service of Salary Structure HR Policies(Leave Policy,LOP,Reimbursement and Arrears) Investory Advice Plan The main function of IPMS is Salary Breakup Salary Policy Since Payroll processing must be following a lot of legal regulations this service is much helpful to the startup companies which has a cost constraint and also for small and medium enterprises that have difficulties in maintaining their payroll.

Summer Internship Report There are two other services namely

Easy Websites a web designing unit Reachout a service which provides digital marketing services and social media optimization.

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CHAPTER 4 FUNCTIONAL DEPARTMENTS

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Facil Internet Technologies is a marketing company .Though the main business is marketing of Services.It has other depatments also namely

Finance department Human resource department Information technology department Marketing Department

Finance Department
Objectives To Manage & account for the financial resource of the Organization, to forecast its requirement in the future and plan accordingly and to check for deviation. Report the financial performance of the company to Management, and to comply with the Govt. rules and regulations

4.2.2 Functions of Finance Department Some of the main functions are Payroll, billing, Preparation of journal, ledger and trial balance, Banking, Financial resources & materials accounting, Budget preparation, Cost accounting, Auditing, Preparation of financial statements & reports, Corporate Planning.

4.2.3 Process of Finance Department Finance department in Facil is divided into five sections for carrying out its process. They are:

Summer Internship Report Bills & Materials Sales Costing, MIS, Budget Cash, bank & Payroll and Tax & duties

4.2.3.1 Bills & Materials - The main functions is to record accounting and receiving, Dispatch and holding of bills

4.2.3.2 Sales Accounting Accountability for selling and distribution of services. Recording the transaction Transfer of information from depots to HO Compilation of reports

4.2.3.3 The Costing, MIS And Budget Section This section is concerned with ascertaining the cost of marketing the services, providing information, helping to prepare a budget, forecasting the performance and finally making a plan.

Summer Internship Report Fixed cost - Salaries and wages (Direct, Indirect, Administration & Maintenance), Staff welfare expenses, Insurance, office

maintenance, Depreciation, Administrative overheads, bonus.

MIS (Management Information System) To provide the management with vital facts which affects the efficient running of the business for decision making on planning, organizing and controlling the major activities of the organization and initiating suitable action. MIS Briefly consists of: Monthly report of all the expenses is prepared P & L Account-Statement and its analysis Production performance of the division Inventory position Cost of production - Actual and budget for the month Specific information important for the management - Major projects, man-hour utilisation etc.

Budgeting Two types of budget - Revenue and Capital budget Two types of estimates - Budget estimate and revised estimate

4.2.3.4 Capital Expenditure

Summer Internship Report Shows all items of capital expenditure to be undertaken during the budget period like expenditure on acquisition of new assets like machinery, furniture and office equipments which have reasonable life; expansion of existing facilities and modification and improvements to plant and machinery resulting in i) ii) increase in capacity Increase in useful life

iii) iv) Monthly report

Improvement in quality of output and Reduction in cost of output is treated as capital expenditure.

On closing of the accounts of the months a monthly P & L account is prepared. This report would give a comparison of the actual for every month against budgeted performance.

The Cash, Bank And Payroll Section

This section is concerned more with the day to day activities and less of future forecasting & planning. Cash And Bank Accounts Section The various functions include: Receipt of cash, cheques, bank drafts, and postal money orders Payment of cash, cheques, bank drafts, and letters of authority Handling of bank deposits/withdrawals, custody of cash and inter unit transfer of funds

Summer Internship Report Maintenance of petty cash books and cash books Reconciliation of bank accounts Security arrangement of cash handling Safe custody of valuable documents Cash interests calculation Any other duties assigned by authorized officer

Payroll Section Functions of the section are: Preparation and disbursement of salaries and wages to managerial and non-managerial employees Effect various recoveries through payroll and remit the same to concerned agencies Processing of various personal payments advances Keeps books of account for the above transaction.

Human Resource DEPARTMENT General Information

Human resource management is one of the most complex and challenging fields of endeavor. It is considered to be the most expensive and important resource of every organization.

Summer Internship Report Human Resource capability remains a key source of the Companys competitive advantage. The Company continues to place emphasis on enhancement of skills and capabilities of its people for meeting future challenges. The key areas of human resource developments are training, competency development and skill enhancement. The Company continues to implement best practices and innovative initiatives to meet the challenges in acquiring and retaining talent against intense competitive pressures. As the Company takes on projects with higher complexities and expands its business, the need to reinforce the human resource capabilities becomes more critical.

Objectives
To maintain the optimum manpower required to sustain the growth of Organization. To motivate and manage human resource and train them to ensure their personal and organizational development.

Functions of HR Department
Organizational human resource planning & development Recruitment & selection Wage & Salary administration Employee records maintaining Performance appraisal Welfare programme Job evaluation Handling employee grievances Handling the legal issues within & outside the Organization

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General Information
Human resource management is one of the most complex and challenging fields of endeavor. It is considered to be the most expensive and important resource of every organization. Human Resource capability remains a key source of the Companys competitive advantage. The Company continues to place emphasis on enhancement of skills and capabilities of its people for meeting future challenges. The key areas of human resource developments are training, competency development and skill enhancement. The Company continues to implement best practices and innovative initiatives to meet the challenges in acquiring and retaining talent against intense competitive pressures. As the Company takes on projects with higher complexities and expands its business, the need to reinforce the human resource capabilities becomes more critical.

4.4.2 Objectives
To maintain the optimum manpower required to sustain the growth of Organization. To motivate and manage human resource and train them to ensure their personal and organizational development.

4.4.3 Functions of HR Department

Organizational human resource planning & development Recruitment & selection Wage & Salary administration Employee records maintaining Performance appraisal Welfare programme Job evaluation Handling employee grievances Handling the legal issues within & outside the Organization

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4.4.4 Process of HR Department

The human resource department has 3 blocks which are: Establishment Industrial relation Welfare

4.4.4.1 Establishment Section

The main functions are: Recruitment & selection Transfer, rotation and placement of employees in consultation with divisional heads Wage and salary administration Performance Appraisal Retrenchment

4.4.4.2 Industrial Relation

Industrial relation operates only within the Organization. The Inter organizational relation is handled by the corporate cadre. 60 to 70 % of management time is lost in resolving IR issues. Therefore the H.R department is of paramount importance. The main functions are: Communication between management and trade unions

Summer Internship Report Grievance handling Settlement of dispute Handling disciplinary action Safeguarding Employee rights Career related issues like promotion, transfer & rotation Resolving daily petty issues

4.4.4.3 Welfare
Welfare schemes can be divided into Statutory, Agreement, Voluntary and Incentives The main objective of welfare measures is to maintain healthy working environment and raise the standards of living of employees which create harmony to the society and finally to the organization. Facil has always maintained very healthy measures. Following are the various facilities provided by Facil to their Employees.

Statutory and Agreement scheme

Health, safety, welfare Transport facilities Leave & holidays Local travel expenditure Conveyance Allowances Payment of gratuity Act, 1972 Employees welfare fund

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Voluntary Scheme and Incentives scheme

Production incentives & Business incentives Incentives for employees & Suggestion scheme

Talent Acquisition
Talent acquisition is the targeted recruitment/acquisition of high performing teams. Organizations requiring external recruitment or head-hunting firms are now employing "talent acquisition" specialists whose job it is to identify approach and recruit top performing teams from competitors. This role is a highly specialised role akin to that of a traditional recruiter/headhunter specialist but carrying greater visibility and strategic importance to a business.

4.4.5.1 Talent Acquisition Process

Identify vacancy Prepare job description and person specification Advertising the vacancy Managing the response Short-listing Arrange interviews Conducting interview and decision making

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Sources of Recruitment
Educational Institutes
Various management institutes are a good source of recruiting for Facil. They provide facilities for campus interviews and placements. This source is known as Campus Recruitment. The major sources of campus recruitment for Facil are:

Internet Recruitment Services

The Internet has revolutionised the recruitment world, drastically changing the way companies and recruitment agencies look for quality talent. The Internet is probably one of the greatest recruitment resources available to Recruiters. Facil is recruiting on the Web whether through:

Training and Development

Summer Internship Report The principal objective of training and development division is to make sure the availability of a skilled and willing workforce to an organization. As Facil is a startup it focuses much on training the employees so that they can effectively work on the mission and vision of the organization. In addition to that, there are four other objectives: Individual, Organizational, Functional, and Societal.

Individual Objectives help employees in achieving their personal goals,

which in turn, enhances the individual contribution to an organization.

Organizational Objectives assist the organization with its primary

objective by bringing individual effectiveness.

Functional Objectives maintain the departments contribution at a level

suitable to the organizations needs.

Societal Objectives ensure that an organization is ethically and socially

responsible to the needs and challenges of the society.

Performance Appraisal
A performance appraisal or performance evaluation is a systematic and periodic process that assesses an individual employees job performance and productivity in relation to certain pre-established criteria and organizational objectives. 360 DEGREE PERFORMANCE APPRAISAL METHOD Facil has adopted 360 degree performance appraisal method which is the most comprehensive appraisal where feedback about the employees performance comes from all the sources that comes in contact with the employee on his job.

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SUPERIOR

CUSTOMERS

SUPPLIERS

EMPLOYEES

PEERS

TEAM MEMBERS

SUBORDINATE

Grievances
Grievance is all about violation of the contract, practices, rules and regulations. As human beings are different there is bound to be grievances among employees leading to conflicts at the workplace. To avert any kind of conflicts within the organization, there is need for a proper grievance procedure so that the employees feel that their grievances are addressed and redressed.

Grievance Handling
Identify the grievance and acknowledge the same. Listen carefully to the complainant. Define the grievance clearly. Gather the complete information with facts and figures. Analyze and search for multiple solutions to the grievance and finally select the best feasible and possible solution and implement the same. Ensure that there is follow-up at each stage for successful grievance procedure. Prescriptions during Grievance Procedure:

Summer Internship Report If you are not the appropriate person, refer to the right person. Spend adequate time with the complainant. Be cool and composed during the process. Check for facts and figure rather than hearsay. Practice attentive listening skills. Find out what bugs the complainant. Dont have any preconceived notions about the involved parties. Dont threaten people. Always try to settle the grievance at the lower level amicably rather than dragging to the higher levels where it might become more complicated. Conduct the grievance hearing privately. Make necessary changes, if there are any irregularities in policies and procedures. Keep the entire grievance process confidential. Always make the process win-win situation.

Employee Motivation
Motivation is a set of forces that directs an individual to the behavior that results in better job performance. A motivated employee might work harder than expected to complete the task, proactively find ways to improve the quality and efficiency of the work environment.

Level 1: Safety and Security

Along with a physical sense of well-being, there must be a psychological belief that the environment is free of fear, intimidation or harassment.

Level 2: Rewards
Organizations offers cash and kind rewards to the employees on their performances. This helps them to keep their performance in a growing stage.

Level 3: Affiliation

Summer Internship Report This is a sense of belonging. It includes being "in the know" and being part of the team. This is also where a difference in personal and organizational values can have a big impact on motivation.

Level 4: Growth
Employees want to have the belief that achievement is taking place. I might feel safe, get all the money I want and feel part of the team. But if there are no growth opportunities, I might think about leaving the company.

Level 5: Work/Life Harmony

This term speaks for itself. Someone might have all the rewards that he/she wants, but he/she will burn out sooner or later if they don't have the time to spend it on the other things they want.

Level 6: Fun Activities

Facil organizes the fun activities to motivate the employees and make them to learn the things along with learning. Quiz, Team Building Games etc

Marketing Department
Marketing is the process of creating value,communicatin value and delivering value It is a department which is the profit centre business. This is the revenue earner of any organization and it is much important for converting the services into cash As Facil is into service industry it offers Business to Business (B2B) services and offers Payroll services. Facil starts marketing by identifying customer needs and wants through Market Research and ends with satisfying them through a coordinated set of activities that also allows a Facil to achieve its own goals, profitably. At market research we are able to find out the potential

customers,competitors,market size customer needs as we are able to analyze the needs of the consumer

Summer Internship Report Marketing Team here conducts the market research so they are helping the sales team by providing information of potential markets. Similarly the sales team helps the organization by achieving targets which in turn helps the organization to earn its revenue.

IT Department:
The IT department in the organization is like a back bone of the organization. It serves all the back end operations and helps all the departments and organization to achieve their goals. The role of IT department in the organizations is to deal with all of the issues regarding the technology. The three major functions in an organization are Finance, product and marketing. Today because of the advancements in the technology companies have Information Technology Departments. The aim of IT department is to provide technological support to the whole organization wherever needed. IT department also keeps on searching new tools and software which may enhance the efficiency of the organization. In addition, whenever the company faces technological issues then IT department is responsible to solve the problems. The following are the different applications of IT departments .5.2.1 Marketing Department

Marketing professional always looks for the way to do something amazing to impress the clients, to get the job done faster and to grow the business.

Facils IT department helps the marketing professional to make effective presentations to present to the client.

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The IT department also helps them to perform the market research through web surveys. It saves lots of time and helps to analyze the current scenario of the market.

The various IT tools also help to understand the consumer behavior, customer preference and taste through past records which will be kept safely only with IT department.

Each and every detail about the client will be kept safely for future contact and to build relation with the customers.

IT department also helps to market the organizations services through online and save cost.

Finance Department Information technology plays a key role in the Finance Departments Harmonize Financial Processes Automation

HR Department

Summer Internship Report It is important to look forward for the changing trends in technology which can have an impact on the HR practices. Understanding these changes will help smart managers to adapt and flourish. Once you exploit these changing trends, you can very well have the advantage over other players in the global market. The wide range of impact of technology on HR can be clearly viewed on the HR functions such as: Recruitment Training & development Performance management Payroll & attendance records Employee benefits etc

At Facil all the IT functions are taken care by Fomax Technologies Private Limited.

Operations Department:
The operations department in an organization is responsible for the conversion of inputs into outputs. Here in this company the following is the operational procedures are done like this.

INPUT

PROCESS

OUTPUT

Generally the inputs are converted into outputs .An Example is given below . The input for a spinning mill is cotton the process consists of removing the seeds converting into yarn and finally the yarn is converted to cloth.

Summer Internship Report Similarly for the payroll processing there is a process of collecting certain data from the client and this is a step by step process.

Inputs : Details of an employees salary . Process: The process consists of various salary details like deductions to made and
also the leave policy.

Output: The final output is Payslips and Paycheques.

Facil Internet Technologies is a marketing company for payroll process it has a tie up with BalaKrishna Legal Consulting. They provide the technical and statutory complaince for the payroll process.

Balakrishna Consulting (BCL) THE BACKEND OPERATION TEAM OF FACIL is a team of Chartered Accountants, Company Secretaries, Cost Accountants and Advocates.BCL team is having over 15 years of experience in Corporate Laws. Our expertise services are not just restricted to Company Incorporation, Company Formation, LLP Registration or assisting in starting your dream business in across India. Our team assist you at each level to comply with all the applicable laws and nurture you to develop your business Balakrishna Consulting (BCL) . These are the various functional departments that are present in Facil Internet Technologies.

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CHAPTER 5 SWOT ANALYSIS

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SWOT ANALYSIS
SWOT analysis (alternately SLOT analysis) is a strategic planning method used to evaluate the Strengths, Weaknesses/Limitations, Opportunities, and Threats involved in a project or in a business. SWOT ANALYSIS SWOT analysis (alternately SLOT analysis) is a strategic planning method used to evaluate the Strengths, Weaknesses/Limitations, Opportunities, and Threats involved in a project or in a business. SWOT Analysis of Facil

Summer Internship Report SWOT Analysis of Facil

HELPFUL
INTERNAL ORIGIN

HARMFUL WEAKNESSES
1. Startup 2. Limited finance

STRENGTHS
1. Experienced Management teams 2. Affordable products/services

EXTRENAL ORIGIN

OPPORTUNITIES
1. Large base of SMEs in India 2. Growing Entreprenurship

THREATS
1. New Competitors

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CHAPTER 6

FINDINGS AND CONCLUSIONS

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Current Method of Payroll

Payroll Software

33%

Outsourced

14%

Manual

53%

0%

20%

40%

60%

Observation

A significant 53% of the respondents have indicated that manually process Payroll within their organization.

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Better Method of Payroll Processing

Payroll Outsourcing Online Payroll Software Offline Payroll Software Manual Method 0%

7%

32%

17%

44% 10% 20% 30% 40% 50%

Observation

Manual Method (44%) is indicated as a better method of payroll processing by organizations.

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Challenges Faced in Payroll Processing

Errors in Reports Quality in service Limited High Cost Of HR Flixibility of Difficulty in Delay In Payroll Deficiency of 0%

3% 3% 23% 20% 3% 11% 29% 9% 10% 20% 30% 40%

Observation

Delay in Payroll is largest issue faced by the organizations. This leads to employee de-motivation, and at times attrition and lower productivity.

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Challenges faced in Manual Method of Payroll

Limited Awareness of Statutory Obligations High Cost of HR 15% 65%

Delay In Payroll Deficiency of Knowledge 0%

13%

7% 20% 40% 60% 80%

Observation

In the manual method of payroll too Limited awareness of Statutory obligations is a single largest challenge faced by human resource department followed by High Cost of HR and Delay in Payroll.

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Challenges faced in Outsourced method of Payroll

Limited Awareness of Statutory Obligations

54%

Delay In Payroll

29%

Deficiency of Knowledge 0%

18%

20%

40%

60%

Observation

Limited awareness of statutory obligations and Delay in Payroll are major challenges faced by the Human Resource Departments

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Challenges faced using Payroll Software Tool

Tax Accuracy Resources to Manage the Software Real Time Reporting Maintanance Cost Technology Acquisition and Upgrades 0% 7% 10% 20% 30% 40% 50% 6% 34% 39% 14%

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Observation

While using the software it was found the Maintenance Cost, Real Time Reporting are issues plaguing the human resources teams followed by tax related issues, which had lot to do with understanding the changes of tax laws which are ever changing?

Additional Services desired by HR Dept. for Payroll Processing

Low Cost Payroll Processing Timely Processing of Payroll Ease of Payroll Processing Statutory Consulting and Filing Automation of Attendance, Accuracy of Processing Customized Reports and Process 0% 10% 13% 16% 20% 30% 40% 2% 4% 7% 27% 31%

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Observation

Automation of Attendance, Leave, Statutory Consulting and Filing followed by Customization of Reports and Processes are the major needs of HR Departments as they opt for Outsourced payroll processing. The above issues can be termed as Pain Points of Human Resources Personnel.

Criteria for Selection of a Payroll Outsourcing Company

Vendors Reputation Technical Payroll Processing Capability Price Delay in Payroll Confidentiality Client Base 0% 10% 0% 0% 16% 20% 30% 40% 50% 14% 23% 47%

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Observation

Technical Capability and Vendors reputation are key criteria for selecting a Payroll Processing Company. Reputation also implies that they deliver accurate and error free and timely delivery of services.

Organizations with Employees seeking Outsourcing of Payroll

>50 >30 and <=50 >20 and <=30 >10 and <=20 <10 0% 5% 10% 12% 15% 20% 25% 30% 16% 28% 20% 24%

<10 >10 and <=20 >20 and <=30 >30 and <=50 >50

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Observation

Organizations with employees between 10 and 20, greater than 50 and between 30 and 50 have indicated need for outsourcing. It is also observed that Multinational companies with limited knowledge of India Statutory compliances have indicated a greater need for outsourcing

Findings
The study was mainly conducted not only to study the organization structure functional departments and their functioning in the organization. The major objective of the study the consumer behavior. Consumer behavior is the main aspect that is to be considered before developing a product/service of a particular organization. This is because a organization needs to understand various factors of the market and the external environment in order to find out whether the product has a market potential. This could be understood only when the consumer behavior of a particular market is studied. There are two types of business systems namely Business to Business

Summer Internship Report Business to Consumer And there is a difference in the type of consumers namely Corporate Consumer Retail Consumer The market of Business to Business enterprise is much different from the Business to Consumer enterprise so it should be understood that market research must be done order to find out the consumer behavior. Before entering into any market to analyze the market place a analysis is done it is PESTEL Analysis. PESTEL stands for Political Economic Social Technological Legal

This should be done in order to find out whether the environmental factors are affecting the business of any enterprise. Political Environment is important because political instability

This study was conducted at Facil internet Technologies Pvt. Ltd to understand the Organizational Structure, Various Functional Departments like Production, Finance, Marketing, Human Resource, & IT, the inter dependence on each other and the services offered by the organization. After spending 6 weeks at Facil Internet Technologies Pvt. Ltd. The major findings about the industry and organization are as follows:

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6.11.1 About Industry:

There are many Small and Medium size organizations having number of employees 10 50, are facing lots of challenges while processing the payrolls of their employees and not satisfied with their current method of payroll. The major challenge faced by the Human Resource department of many organizations is the continuous changes in the statutory obligations which they are unable to keep the update. As the number of employees in the organization is increasing the challenges for payroll process is getting increased. The organizations which are using online or offline methods of payroll processing are lagging behind in the knowledge of payroll processing. The industry requires more number of technical experts who can process payroll.

6.11.2 About Company

Being a startup, all the departments are well organized, functioning very well and active and managed. The organization is having flat structure and divided into several units like Production, Finance, Marketing, Human Resource, & IT. These all departments are headed by the head of the organization but at the same time they work for same objective with full co-ordination which shows the unity level about the organization. All the departments are having their own importance but while observing from a organization point of view they all work with each other. There are more number of newcomers and young blood working in the company.

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One important suggestion is that more care and concern should be given to the clients to retain the trust of existing valued customers. As company works on the philosophy of Customer is King. The company can promote its services through social media, as its costs nothing as compared to other promotion medium. Company should hire more number of marketing executives and technical experts to provide better services.

Company should focus more on technical part as the industry is facing challenges
in technical issues.

6.13 Conclusion
The study at Facil internet Technologies Pvt. Ltd. has enabled me to understand the various needs of an organization, how an organization of a corporate nature functions and how important it is to have a right relationship between the employee and employer or the management. The study was conducted with a view to understand the functions of an organization, and its various departments. During the course of study I was successful in achieving these objectives and could familiarize with an organization and its environment. This study has improved my confidence by its successful completion to undertake such studies in the future.

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APPENDIX

Questionnaire
A Study on Comparative Analysis Of Market Research on Payroll Process
As a part of my MBA program, I am doing this survey to understand the complete Industry Structure, HR Policy, Salary Structure, Understanding the bettor method of Payroll processing, to know the challenges faced by the organizations. Hence I request you to spare a few minutes from your valuable time.

Name Of Company

:__________________________________________

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Name of HR Contact Designation Email ID Mobile Number URL No of Employees

:__________________________________________ :__________________________________________ :__________________________________________ :__________________________________________ : www.____________________________________ :__________________________________________

___________________ Signature Seal of Company

Is your Organization Bangalore based? Yes ( ) No ( )

What payroll method have you currently adopted? Have our own Payroll Software. Payroll outsourced to Vendor. Manual . ( ( ( ) ) )

If Manual, Would you like to outsource Payroll ( ) or

Summer Internship Report Would you like to buy Payroll Software (

Which is a better method of payroll processing, according to you? Online Payroll Software Offline Payroll Software Outsource Payroll Manually ( ( ( ) ) ) Could you tell us why ?

Which of the following is the most important factor considered while buying payroll . Software / Payroll service? ( ) Quality Of software Price ( ( ) ) )

Service (Post sales Service) (

Since how many years you are using payroll process? 0 to 1years ( 2 to 5 years ( ) ) 1 to 2 years ( 5 to 10 years ( ) )

What are the issues which you faced from your current Vendor? Have you Faced any of the following challenges in your current method of payroll? High Cost of Human Resource Delay in payroll Deficiency of Knowledge Difficult to manage software
Such as Provident Fund, ESI, Income Tax Filing, Professional Tax etc

( ( ( (

) ) ) ) )

Limited awareness of Statutory Obligations (

What additional Services would you want for your payroll Service?

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What are the important factors on which you decide to outsource your payroll process ? Vendors Reputation Technical Expertise ( ( ) ) Client Base Price ( ( ) )

Have you faced any challenges in maintaining payroll software? Tax accuracy Resources Maintaining Cost Real time reporting ( ( ( ( ) ) ) ) )

Keeping Technology acquisition. (

Have you faced any challenges while processing payroll manually? Time consuming High Cost of Human Resource Limited Awareness of Statutory Obligations Attrition or Inconsistency. ( ( ( ( ) ) ) )

How much would you be willing to pay per month for Outsource payroll Service? Rs. .

Any Suggestion or Remark For Payroll Process