1.

INTRODUCTION

The project titled Organizational study of Akay Flavours & Aromatics Pvt. Ltd is an earnest attempt to understand the functioning of the organization and assimilate the departmental and managerial functions in detail. The study was conducted in Akay Flavours & Aromatics Pvt. Ltd, Malaidamthuruth in Aluva town of Ernakulam district. Akay Flavours & Aromatics Pvt. Ltd is the manufacturers and suppliers of paprika and spice oleoresins, natural essential oils, and natural colours for the global food industry. The organizational study aims to familiarize with the functioning of the firm and helps in providing a pragmatic approach to various functionalities in the organization. The study provides an understanding of the departmentation and managerial functions in the organization in the real business world, keeping in mind the theoretical knowledge provided by management professionals and experts in the academic curriculum.

1.1

INDUSTRIAL PROFILE

India is traditionally been known for its spice and culinary herbs production. It is one of the largest spice producing and consuming country. Indias strategic location, climate conditions, advanced production process and availability of cheap labor etc are some of the favorable factors which ensure large scale production of quality spice and herbs.

Indias Share in the Global Spice Market

The Indian spice industry is booming with a substantial increase in export over the past few years. Indias accounts nearly 45% and 30% in terms of volume and value in the world spice trade. The booming global spice market also poses good opportunities for the Indian spice industry to provide quality spices at competitive prices. Indian exporters face stiff competition from China, Malaysia and Pakistan in terms of pricing of the products. Manufactures should therefore ensure consistency in supply, product quality, pricing and marketing strategy to increase their share in exports. Producers are incorporating largest methods and technologies to ensure higher quality of spices and herbs. India is one of the prime exporters of pepper, chilies, turmeric, seed spices and spice derivatives to the rest of the world. USA, EU, JAPAN and SRILANKA import these Indian spices in large volume.

Indias Share in Global Spice Derivative Market

Spice derivatives can be categorized into spice oil, oleoresins and essential oils. The demand for spice derivatives is increasing due to the hygiene, standardization and consistency factor. India contributes nearly 70% of the world spice derivative market. It exports largely to the USA and Europe. The Indian industry of spice is concentrated over the southern stages. The concentrated oils and oleoresins are used widely in perfumery, pharmaceutical, foods processing and chemical industry.
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Government Initiatives
Indian government is providing financial assistance to farmers, growers and spice producers and also has taken certain steps to ensure the availability of better quality spices and hygienically processed spices in order to boost exports. Indian spice board also provides financial and technical assistance to farmers.

About Spices
The strongly flavored and aromatic part of certain specious of plant is used in small quantities as either a preservative or a flavoring agent in cooking. Indian spices are generally the dried part of the bark, root or stem of a plant. Indian spice has their essence in the hard part of a plant.

Form of Spices
Whole spices: these spices are used in their original form after being thoroughly cleaned. These spices are used both for garnishing as well as flavoring. Example: cloves, cinnamon, black pepper etc. Grind spices: grinded spices are used as they deliver flavor quickly and also they blend easily into a product. This is so, because grinding of spices breakdowns the protective cell structure.

Parts of Plant Used As Spices

Berries Buds Leaf Roots Seeds Kernel
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Spices Extraction Methods

There are a number of extraction methods of spices being used depending in the technology and also the form of Indian spices being extracted. Some of the popular extraction methods are: Steam distillation Hydrocarbon extraction Chlorinated solvent extraction Enzymatic treatment and fermentation Carbon dioxide extraction

Application of Indian Spices

Spices are used mainly for food flavoring and preservation. However, Indian spices have medicinal, aromatic properties that also make them useful in a number of industries as follows. Perfumes Cosmetics Medicines

Beverages

International Trade in Spices

Spice trade has always held major economic importance throughout the human history. The international trade in different form of spices has grown tremendously in the last decade. According to an estimate 85% of the international trade in spice is in the dried form and is used without further processing. Pepper is one of the most valuable spices in the global trade. Countries including China, Madagascar, India, and Indonesia are the leaders in this trade.
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Indian Spices Market

India is famous for its spices that are widely used in industries like pharmaceutical, perfumery, toiletry and cosmetics. India is one of the major suppliers of pepper to large number of countries since ancient times.

Growth in Spices Market

The Indian spice market has shown remarkable growth in spices and culinary herbs exports. Indian spices manufactures are making substantial efforts to improve the quality of spices backed up by technological advancement to tap the international market. Advancement technologies such as carbon dioxide extraction, Cryogrinding, encapsulation of spices oil is being undertaken to ensure high quality of spices and their derivatives.

Market for Spice Oils and Oleoresins

Indian exporters leading in the field of spices derivatives, meeting almost 70% of the total demand of spices oils and oleoresin. The company is providing value added products and achieved a reputation in the international community. The focus is on strong R&D, the Indian manufacturers are developing new products, implementing organic methods of production for providing organic spices and herbs, which command a 10-30% premium.

Spice Export Figures

Indian spice exports accounts for about 39% of the total exports in terms of volume and around 22% in terms of exports value. India meets almost 65% of the global demand for derivatives like spices oils and oleoresins.

Major Spice Exported

Chilies Seed spices Turmeric Spice oils and oleoresins Pepper Cardamom Ginger Fennel Fenugreek Nutmeg and Mace

Organic Spices
Organic spices are those spices that are grown using organic farming method. Indian organic spices are grown with only limited use of pesticides and other synthetic fertilizers and growth regulators. Organic farming is the new buzz word in farming of spices, courtesy to the enormous effort by various NGOs towards a green and clean earth. Today most of the countries provide technological and financial assistance to farmers and producers for using organic methods.

Indian Organic Spice Market

The Indian organic spice market is comparatively small at present (According to estimate, it is a little more than 1% of the total spice demand) however it growing.

International Trade in Organic Spices

The international circuit is witnessing an unprecedented growth in the trade of organic spices and herbs. Countries are encouraging the farmers and other growers to produce spices using organic method of farming. North America and Europe are the major organic spice market. The organic spice commands a 10-30% premium in the international market.

Application of Organic Spices

Organic spices are used mainly for food flavoring and preservation. However spices have medicinal and aromatic properties that also make them useful in a number of industries like o Perfumes o Cosmetics o Medicines

Spice Production Areas

The spice and culinary herbs are concentrated in the moderated and semi-tropical regions of the world. There places are suited for spices or herbs due to their climate conditions and other factors including law wage rates, sound infrastructure etc. the production areas of spices and herbs can be categorized as follows: Global spice production areas: The production of spices and herbs has been

traditionally concentrated in countries like Egypt, India, Europe; particularly France is a new entry to league. Other major spice manufacturing areas include Bulgaria, Germany, Hungary etc. China, Malaysia, India and Korea are the leading spice production in Asia. India, Israel and a few European countries are leading in culinary herbs. Indian spice production areas /centers: The production of spices and herbs

is widely distributed in a number of Indian states, Southern states of Karnataka, and Tamilnadu are famous since ancient times. States of Rajasthan and Utter Pradesh are growing spices like Garlic, Mustard and Fennel Turmeric.
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Spice Derivatives
Essential oils: Essential oil has traditionally been used for therapeutic value. These oils have the properties of the spice or herbs they are derived from. These aromatic and volatile oils are extracted from the leaves, stems, and flowers of plant. Essential cooking oils are of complex composition and contain alcohols, esters, phenol in varying proportions, since these specialty oils have a very strong aroma and are highly volatile, they are used as a raw material in flavoring and perfumes.

Essential Oil Production Method

Steam Distilled Solvent Extracted Cold Pressed Hydro Diffused Carbon Dioxide Extraction

Market for Essential Oils

USA, EU, and Japan are the major import markets of essential oils. The international trade in essential oil has been on the rise for the past few years because of the increase in demand of these oils in a number of industries. The increased preference of natural products, natural fragrances and flavoring makes essential oils hot for the market.

Use of Essential Oils

The essential oils are traded in high volume and are particularly consumed in the flavor, personal care and pharmaceutical industries. These spices derivatives marked by their antiseptic and antimicrobial action for healing and smoothing effect. Following are some of the areas where the essential oils are used extensively Soaps Cosmetic Perfumery Confectionery Aerated Drinks Syrups Chewing Delicacies

Spice Oil
Spice oil is a spice derivative that is extracted generally by steam distillation. The spice essential oil distilled off from the spices at the initial stages before subject to solvent extraction. Spice oil is the volatile components present in spice and provide the aroma flavor of the spice they are made from. India is one of the top most producers of spice oil and contributes to around 70% of the total spice oil production. Countries including USA, EU, Japan and other Middle Eastern countries are the major importers of spice oil. The exports of Indian spice oil have been rising significantly in the last few years owing to sharp rise of demand in the fast food sector.

Popular Spice Oils

Spice essential oils are traded in large volumes for use in a number of industries. Some of the extensively traded oils are as follows: Clove oil Cardamom Oil Nutmeg and Mace Oil Mint Oil Pepper Oil

Advantages of Spice Oil

Standardization: these oils ensure standardization in various products and these are popularly used in pharmaceuticals, medicines and chemicals. Consistency: these oils have a consistent concentration of the spice they are made and hence more reliable. Hygiene: these oils are manufactured using high technology machinery and processes, hence are quite hygienic.

Use of Spice Oils

Food Processing Beverages Pharmaceuticals Chemicals Aromatherapy

Personal Hygiene products

Spice oleoresins are the concentrated liquid obtained from spices. This spice derivative has the same character and property of the spices it is obtained from. Oleoresins are popularly used for food flavoring in the food processing industry.
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The demand for these derivatives is on the rise in the global market and India too is cashing on this booming market. India is one of the leading producers and exporters of black pepper oleoresins. US are one of the chief importers of paprika and black oleoresin. The demand of this product can be attributed to a sharp rise in the snacks food and fast food industry for producing a standardized effect on taste. High concentration of oleoresins makes them difficulty to use in the food processing industry. These derivatives are sometimes combined with other spices and also used as a base for seasoning. Oleoresins contain the aroma and flavor of the spice in a concentrated from, the form is usually viscous or semisolid materials.

Manufacturing Process
Spice oleoresins are derived through non-aqueous volatile solvent extraction of powered and dried spices. These spices are, mixed with a suitable solvent and subsequently removed at the end of the process through evaporation. Spice oil, being volatile in nature, is distilled from the grounded spice and thereafter the wet spice is dried and extracted with a solvent to produce oleoresins. The extraction method will also vary depending on the properties of the spice being extracted.

Use of Spice Oleoresin

Spice oleoresins find wide application in a number of industries for its strong flavor and aroma Meat Canning Beverages Pharmaceutical Perfumery Confectionery

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1.2 COMPANY PROFILE

The saga of Akay begins in the year 1995. Today, Akay has carved a position of its own as one of the leading manufacturers and suppliers of paprika and spice oleoresins, natural essential oils, and natural colors for the global food industry. It is indeed sheer professionalism and ethical approach in the operations that took the fame of Akay to the global level! Also, Akay is the first company from India to supply organic spice oleoresins according to the strictest US and EU regulations.

VISION AND VALUE Vision

They focus on providing the best service to their customers and partners with their professional way of doing business. Their aspiration is to supply products that always meet and exceed their customers expectations They are committed to ensure food safety and their quality assurance systems are aimed at providing safe products to their customers They are committed to remain attentive to their customers whenever they need They give high priority in maintaining decency in all endeavours

Values
The listed extracts given overview of the values followed at Akay flavours and aromatics. Accountability: Each of their will be accountable - to the company, themselves and society for the quality of their efforts, for contributing to their goals. Ambition:They set the highest standard in everything they do and aim to achieve challenging-goal. Responsibility: They conduct their business in a socially and environmentally responsible-way. Honesty:Their business practices are open and honest to protect the integrity of Akay. Readiness for change: They make themselves prepared for change and use it to their advantage. Innovation is the key to their business and therefore they encourage a learning culture for the continuous development.
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COMMITMENT
The following are the commitments akay as an organization committed to its stake holders

Environmental Responsibility
They continuously improve the way they are operating in their production and sourcing areas by setting higher objectives and by placing bioethical considerations before business. They improve industrial performance and quality while saving on water, energy, raw materials and waste

Social Responsibility
They are committed to follow the 9 principles of United Nations Global Compact They support UNs convention on human rights.

CORE COMPETENCES Sourcing Expertise

Akay Situated in Kerala, the heart of India's spice region, Akay nurtures a very close and special relationship with the local spice farming community to ensure a continued supply of high grade raw materials. At Akay, sourcing is done by a team of sourcing specialists who have many years of experience in the respective field. Sourcing is done from the local markets in India and globally, wherever raw materials, meeting their quality standards, are available in abundant quantity.

Extraction Expertise
Akay has technical experts with more than 15 years of experience in the solvent extraction industry. Only non-chlorinated solvents are used for extraction. Along with their batch extraction plants, a continuous extraction plant is placed for extracting various spices. Akay is also equipped with the latest technology in extraction - Super Critical Fluid Extraction (SCFE).

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HISTORY AND FACTS

Founded in 1995 by A&P Group and entered in to a joint venture with Chr. Hansen A/S, Denmark in 1996 Akay is an independent company, since June 2007, belonging to the A&P Group based in Dubai, UAE Akay manufactures paprika and spice oleoresins, natural essential oils, natural colours for the global food industry Akay has 160 employees primarily situated in Kerala, India Akay has a worldwide presence with own warehouses / sales offices in USA, Europe, China and Japan Akay operates through dedicated distributors and agents R &D as well as product development centre in Cochin, India, recognised by Department of Scientific and Industrial Research, Ministry of Science & Technology, Government of India Integrated Management System certified by Bureau Veritas, consisting of ISO 9001:2008, ISO 14001:2004 and ISO 22000:2005 with PAS 220:2008 Quality Assurance laboratory accredited as per ISO 17025:2005

LOGO

The logo of Akay depicts the Indian Bindi. Thus the logo symbolizes the spices, the Indian heritage and the purpose of Akays products. The logo is also meant to bring associations of a growing plant to mind symbolizing the raw materials, the essence of nature.

SLOGAN
TASTE THE NATURE THROUGH TECHNOLOGY

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AWARDS WON
STAR EXPORT HOUSE by the ministry of commerce and industry of foreign trade BUSINESS EXCELENCE the award by spice board of India on the basis of export turnover SECOND PRIZE from state pollution contrcesboard for medium scale industry Certified by the Bureau for STD ISO 9001.2000 on 20th June 1998 Certified for ISO 22000.2005 on 1st October 2007 Certificate of MERIT from SugandhaBhavan, Cochin for its outstanding performance in EXPORT OF SPICES/SPICE PRODUCTS from India during the year 2006-2007 Certified by spice house for food and safety system and quality management system of the organization manufacture and export of spices oils and oleoresins in 2009

COMPETITORS
AVT natural product LTD Tata spices Asian Herbal LTD Cochin spices Enjoy spice (P) LTD Plant Lipids (P) LTD

CUSTOMERS
HR; Hansen, Denmark SFK; Denmark BBA, Philippines Doney Bang; Korea KNS Trading Company; USA
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ABOUT THE ORGANIZATION Corporate Office

Akay Group P. O. Box 1029, Ajman, UAE Tel: +971 6 7435492 / 7436542

Production Facilities Akay - Cochin

AkayFlavours& Aromatics Pvt. Ltd. Malaidamthuruthu P. O. South Vazhakkulam, Cochin 683561, Kerala, India

Akay - Pathanamthitta
AkayFlavours& Aromatics Pvt. Ltd. Nallanikunnu, Elavumthitta P. O. Pathanamthitta, 689625, Kerala, India Tel: +91 468 2257487 Fax: +91 468 2257471

Akay - Tadas
AkayFlavours& Aromatics Pvt. Ltd. (Raw material pre-treatment center) Tadas Village, ByadgiTaluk, Haveri District, 581106, Karnataka, India Tel: +91 837 5292015

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Sales Offices Akay - Cochin

AkayFlavours& Aromatics Pvt. Ltd. Malaidamthuruthu P. O. South Vazhakkulam Cochin 683561, Kerala, India

Akay Japan Co., Ltd.:

3-148-2-101, Negishi-cho, Naka-ku, 231-0836 Yokohama, Japan.

ORGANIZATION MANAGEMENT
Akay is lead by the Chairman and Board of Directors. The day to day running and manufacturing operations are managed by the Managing Director. There is a Management TEAM to assist the MD, and this TEAM represents the key segments of our business - our market, operations, quality management, supply chain, and global operations. Alex Koshy Chairman Dr. Balu P. Maliakel - Managing Director

OWNERSHIP
Akay is fully owned by A&P Group, based in Dubai. A&P Group holds interests in various other industries including engineering and marine services, building materials, high quality packaging materials, precast products for the construction industry and snack foods.

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PRODUCTS AREAS
Oleoresins Natural Colours Essential Oils

Organic Spices and Extracts

All products are meeting FCC specifications and conforming to US FDA 21 CFR (Code of Federal Regulations) standards.

OLEORESINS Capsicum
Viscous reddish brown homogenous liquid, pourable at room temperature, with a pungent flavour. This has an aroma typical to dried, ground hot chilli and creates a sensation of heat at the back of the throat and tongue. This is available in water and oil soluble forms and is chiefly used in snack foods, processed meats, ethnic foods, and for spice seasoning.

Turmeric
Thick viscous deep yellow liquid, pourable at ambient temperature, with the characteristic aroma of ground turmeric. This is soluble in water and oil and has a typical turmeric flavour. Storage under recommended conditions guarantees a shelf life of 24 months.

Black Pepper
Prepared from half matured, dried berries of Piper Nigrum L, this thick green liquid is pourable at room temperature and has the characteristic aroma of black pepper. The flavour is mildly warm and pleasant up-front and turns hot and pungent later. Soluble in water and oil with its oleoresin nature, this is recommended to be used in spice seasoning, snack foods, soup bases, sauces, savouryflavours, processed meat and other food products that require the flavour of black pepper

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Black Pepper Decolorized

A thick yellowish brown liquid, pourable at ambient temperature, this has mildly warm and pleasant flavour upfront and later turns hot and pungent. This has the characteristic aroma of black pepper and shows good solubility in water and oil. The product is recommended to be used in food products that require the characteristics of black pepper.

White Pepper
Prepared from fully matured, dried, decorticated (white) berries of Piper nigram L, this viscous suspension is pourable at room temperature and is creamy yellow to tan in colour. The flavour is mildly warm and pleasant initially and turns hot and pungent later. The product is available in water and oil soluble forms and is recommended for use in spice seasonings, snack foods, soup bases, dressings and sauces.

NATURAL COLORS Paprika

A viscous reddish homogenous liquid, pourable at ambient temperature. This is soluble in vegetable oils and can be added directly to food products with adequate mixing. This can be used in spice seasonings, snack foods, processed meat and other food products that require the characteristic colour/flavour of paprika.

Curcumin
Prepared from dried ripe rhizomes of Turmeric (Curcuma Longa L), this is a golden yellow powder soluble in alcohol and glacial acetic acid. This solvent is extracted to get Turmeric Oleoresin and then crystallized /purified to reach correct concentration.

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ESSENTIAL OILS Black Pepper

This is a thin, clear to slightly yellow liquid with a mildly warm and pleasant flavour upfront. It has the characteristic aroma of black pepper and is recommended for the usage in savouryflavours, spice seasonings, processed meat, snack food and other food products that require the characteristics of black pepper. This is prepared from carefully sourced half matured, dried berries of Piper nigrum L that are microbiologically tested and screened for quality and adherence to ASTA and FDA Standards.

Ginger
This is a steam distilled volatile oil of Zingiberofficinale with the characteristic aromatic odour and sweet flavour of ginger without bite. This is a light to dark straw coloured liquid and can be a great pick for preparing food products that require the aroma and flavour of ginger. Widely used in preparing snack foods, processed meat, baked foods, confectionary products and in pickling spices.

Clove Bud
Prepared from the dried, unopened flower buds of Eugenia Caryophyllus, oil of clove bud has a strong, spicy, warmly phenolic odour and a pungent flavour. Eugenol is the major constituent of the volatile oil. This colourless to pale yellow oil is used in food products which require the aroma and flavour of clove.

ORGANIC SPICES AND EXTRACTS

Akay is the first company from India to offer organic certified Spice Extracts. The products under this range are extracted using Super Critical Fluid Extraction (SCFE) technology, using liquid Carbon dioxide. Akay has been certified by Indocert and carry certificates according to US (National Organic Program technical standards), EU (council regulation - EEC No. 2092/91) and India (National Programme for Organic Production).

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Organic Spices
Black Pepper White Pepper Ginger Mace Nutmeg Cinnamon leaf Cardamom Vanilla Turmeric Clove bud

Organic Spice Extracts

Organic Oleoresins Black Pepper White Pepper Ginger Mace Nutmeg Clove Bud Cardamom Organic Essential Oils Black Pepper Ginger Mace Clove Bud Cardamom Cinnamon leaf

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QUALITY & FOOD SAFETY

Their quality and food safety management strategy is aimed at embedding awareness of quality and food safety in all theirorganizational process.

Quality Management
Their quality management philosophy is firmly rooted in developing, producing and delivering safe, quality products to their customers. They have developed their quality management system based on the ISO 9001 and ISO 22000 systems.

Quality Policy
They at Akay are dedicated to supply products and services that meet with customer requirements. Their products are for improving quality of food for people around the world. To achieve this, they have established a quality management system, which ensures a logical and systematic approach in improving customer satisfaction. The system is supported by all employees with their contribution of knowledge, experience, innovation, enthusiasm, team work and dedication. Training, education and individual development are provided to further improve the effectiveness of our systems, processes and products.

Food Safety Policy

They, as a food ingredient manufacturer and supplier globally, are fully committed to assure complete food safety to their customers. They communicate our commitment to conform to food safety requirements of the customer and ensure compliance to statutory and regulatory requirements. They assure hygienic processing in their facility to supply a completely safe food ingredient that meets the expectations and needs of their customers.

Legislation
They comply with all relevant statutory and regulatory requirements of the countries importing their products.

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CERTIFICATION
Akay's production facilities are ISO 9001:2008, ISO 14001:2004 and ISO 22000:2005 certified by Bureau Veritas (formerly BVQI). For this, an Integrated Management System (IMS) has been developed and implemented. Akay also is certified to PAS 220:2008 standards. In both these, Akay is the first in the spice industry. Publicly Available Specification (PAS) 220:2008 is a standard which specifies requirements for prerequisite programmes to assist in controlling food safety risks within the manufacturing processes of international food supply chains. This PAS is intended to be used in conjunction with ISO 22000, the internationally recognized standard for food safety management systems. ISO 22000 sets out specific food safety requirements for organizations in the food chain. One such requirement is that organizations establish, implement and maintain pre-requisite programmes (PRP) to assist in controlling food safety hazards. PAS 220:2008 has been developed to be used to support management systems designed to meet the requirements specified in ISO 22000, and sets out the detailed requirements for those prerequisite programmes. Further, Spices Board of India has given 'Spice House' certification to Akay.Akay's products carry Kosher Certification from Star-K Kosher Certification. The products are also Halal certifiable, declaration to this effect is available on request.Additionaly, Akay is the first certified manufacturer of Organic Spice Extracts in India.Akay is also a recognized Export House by the Government of India.

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COMPANY MILESTONE
1870: Christian D.A Hansen develops a method for extracting pure, consistent quality rennet from calves stomach 1874: the company set up its first rennet production plant in Copenhagen, then adds natural coloring agent for cheese and butter 1876: subsidiaries are established in United States, France, and Germany 1878: production in United States begins 1893: company began producing cultures for yogurt and other dairy products 1916: production line in United States is launched 1918: company opens a factory in Canada 1930: a new production site in Milwaukee, Wisconsin is opened 1936: production subsidiaries in Germany and Italy are established 1951: the company enters Australia with a production subsidiary 1955: the rennet production plant in France is opened 1976: DVS diary culture system is launched 1990: extract oils, in Spain is acquired 1995: akay joint venture in India is launched 1996: SEPCAL, in France are acquired 1998: Ingredient Technology Corporation in United States is acquired 1999: the company enters into Russia and acquires Italian Ingredient in Italy 2001: a new DKK 100 million facility opens in Denmark for research, development and resting 2003: Chr. Hansen enters China with subsidiary in Hong Kong 2004: Chr. Hansen holding announces its plan to split off Chr. Hansen group as a separate company in 2005 2007: akay is an independent company belonging to A&P group situated in Dubai, UAE

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2. FUNCTIONAL DEPARTMENTS
2.1 ORGANIZATION STRUCTURE
Vice Chairman

Board of Directors

Managing Directors

General Manager

Manager Operation

Manager Materials

Manager QA

Manager Finance

Manager Marketing

Manager R&D

Manager HR

Assistant Manager

Assistant Manager QA

Deputy Manager

Assistant Manager

Assistant manager R&D

Executive HR

Executive Material

Officer QA

Assistant Manager

Executive Marketing

Executive R&D

Officer

Worker Material

Lab Assistance

Executive Finance

Officer Sales

Officer R&D

Assistant Manager

Executive Production

Officer Production

Operators Production

Workers Production

Assistant Manager

Executive

Junior Officer

Technicians

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The basic structure of Akayflavours & aromatics pvt. Ltd involves issues such as how the work of the organization should be assigned among various positions, departments etc and also to accomplished the total organization objectives. Authority arises because of official positions of a person, his personal competence etc. it is the relationship between two individuals ie, superior and subordinate. The four basic structure forms are the functional structure, divisional structure, matrix structure and network structure.

Functional Structure
Functional structure is the structure that groups people on the basis of their common experience and expertise or because they use the same resources.

Divisional Structure
Divisional structure is that structure in which functions are grouped according the specific demands of products, markets or customers.

Matrix Structure
Matrix structure is that structure that creates dual lines of authority and combines functional and product departments.

Network Structure
It is the structure which is the cluster of different organizations whose activities are coordinated by contracts and agreements rather than formal hierarchy of authority. Akayflavours&aromatics pvt. Ltdhas a functional structure. It is highly characterized by routine operating tasks, much formalized rules and regulations, tasks that are grouped into functional departments, centralized authority and narrow span of control of decision making that follows the chain of command. Then top level managers make all decisions and the lower level managers execute those decisions. Since everything is standardized and formalizes there is no much scope for flexibility. But at the same time creativity and innovations of employees are always welcomed.

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2.2 DEPARTMENTS OF AKAY FLAVOURS

Material Department Production Department Maintenance Department Quality Assurance Department Marketing Department Finance Department Research and Development Department Human Resource Department

2.2.1 MATERIALS DEPARTMENT

Material department develop for manufacturing the material in the company required for running its day to day activities. This department plays an important role in the procurement and maintaining the stock of the raw material and essential items which are needed for the production and performance of the industry. Each and every item for the company is purchase through the material department there is a certain procedure for the purchasing of the material and supplying the same too different department of the company. The purchases made by the department include: Purchase of raw materials

It is the duty of this department to make sure that there is continues availability of raw materials to meet the day to day production needs of the company. All raw materials used in productions are seasonal. so it is might not be available in bulk quantity in every time. So this department makes sure that there is continuous availability of raw material with the help of some brokers and traders. Other production materials

It includes other materials which are wanted for the production process other than raw materials that is solvent, oil emulsifiers etc. Engineering materials

It includes materials that are used for smooth running of the machines or machineries part of the machines like seal, tools, spare parts, nuts and bolts etc.

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Purchasing of capital goods

Capital goods means goods that have a capital value it may be tangible assets for the company like machinery, building, land, equipments etc. they also play a key role in the inventory management and sampling of raw materials.

Purchase Procedure of Commodities

Annual purchase plant for raw materials is made by the committee consisting of MD, GM, Material manager, Finance manager, and Operation manager

Finalize the market target production schedule and raw material purchase plan

Approval of suppliers and vendors validation are identified

Orders are booked over phone or fax or email and recorded in the purchase order

Materials are purchased from these approval suppliers

The raw materials are checked and approved by the QA Department based on the standard

If the raw materials, analysis report does not satisfy the specification and standard it will be rejected

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Structure of Materials Department

Manager Materials

Assistant Manager

Executive Material

Workers Material

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2.2.2 PRODUCTION DEPARTMENT

At Akay, they employ proven methods and advanced technologies in their manufacturing process. It is indeed the in-depth research and development that enabled them to uncover manufacturing processes conforming to superior technical standards. Quality is their motto and they make it a point that the end products retain the flavour and aroma of the source, which is why they have adopted the following scientific methods for their manufacturing process

Production Process
Production

Steam Distillation

Solvent Extraction

Super Critical Extraction

Pre-treatment

Steam distillation & fraction collection

Drying of the steam distilled spice

First Stage RFE

Second Stage RFE

ATFE

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Steam Distillation
Most of the spices contain essential oils that give them a specific aroma profile, unique to each spice. These volatile oils are recovered from the spices through steam distillation process. This process involves 3 stages of operation 1. Pre-treatment Cleaning and Flaking 2. Steam distillation and fraction collection 3. Drying of the steam distilled spice Pre-treatment: The spice is cleaned of all dust and dirt and is sent for flaking. Spices are generally flaked using a roller mill that is cooled by running cold water. These very thin flakes are charged to the steam distillation vessel. Steam distillation and fraction collection: Steam is purged to the flaked spice charged in the steam distillation vessel. This steam carries with it the volatile oil which in turn is cooled through cooling water condensers. The condensed steam along with the essential oil is cooled in steel tanks. The oil segregates in the top and the water is continuously removed from the bottom of the tank. The essential oil is collected as three fractions the lighter, medium and high, by adjusting the distillation time. Drying: The flaked spice after steam distillation is dried inside the vessel using hot air. This dried spice is then transferred to the solvent extractors.

Solvent Extraction
This process involves extraction of the spice using solvents like hexane, acetone or a mixture based on the spice used. They have two batch extraction plants and a continuous extraction plant for the extraction of spice. The batch extraction process involves percolation of the solvent through the spice, after steam distillation, by several washing with the solvent until the extraction is complete, i.e. till all the active ingredients in the spice are fully taken to the solvent. The miscella thus formed contains about 10% of extracts (oleoresin) from the spice and 90% solvents. This miscella is then evaporated in a 3 stage evaporation system.

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1. First stage RFE (Rising Film Evaporator) 2. Second Stage RFE 3. ATFE (Agitated Thin Film Evaporator) With this three stage continuous evaporation system they reduce the contact time of the miscella with heat to the minimum level, thereby reducing the degradation of the active natural molecules present in the spice. The concentrated Oleoresin after the ATFE is taken for final solvent removal in vacuum desolventiser. Here high vacuum is applied to remove the solvent traces below 25 ppm. The product is then stored in quarantine tanks and inspected for residual solvent levels and other quality parameters. This crude oleoresin is then blended to the required specification as per the customer requirements or the standard specifications.

Super Critical Extracted Products

This is a latest extraction technology employing liquefied carbon dioxide as the solvent. Supercritical Carbon dioxide behaves as an excellent solvent for extraction. As the supercritical nature of carbon dioxide is achieved at high pressures above 30 MPA, the process of super critical extraction is done at very high pressures. They employ specially designed high pressureextractors for extraction. By adjusting the pressure it is possible to take the essential oil first followed by the oleoresins. By releasing the pressure the Carbon dioxide is transferred to the collection tank and the essential oils and oleoresins are collected in separate tanks by the differential pressure maintained in the receivers. The main advantage of this process is that there is no solvent residue in the final product as all carbon dioxide escapes with the release of pressure from the system. Also, the process is done at low temperatures and there is no heating of the spice, making the oleoresin resemble the spice very closely in flavour and aroma. Supercritical Carbon dioxide is a green solvent system approved for Organic products. At Akay, they apply this extraction system to manufacture Organic Extracts.

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Packing and Labeling

This process is done in finished goods storage is as per the dispatch instruction from the quality assurance department. The packing is to be done based on the customer requirement. There are different packing materials in standard size and weight such as, Rex Pail, Combo Drum, Carboys etc. labeling is also to be done as per the customer requirement in the specified format.

In view of customer requirements globally the materials listed or termed as Auer gens is not used in any of their production lines and entry and usage of same is strictly prohibited inside the factory of the company. Materials listed as Auer gens are: Peanuts & Peanuts product Tree nuts Fish Shell fish Egg & Egg products Diary & Diary products Wheat and Wheat products Soya bean & Soya bean products

FUNCTIONS OF PRODUCTION MANAGER Planning production and raw material requirement Control of production activities Improvement of production environment Corrective and preventive action Daily production report, monitoring inventory of finished goods, rework, reject Maintain documents

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Structure of Production Department

Manager Operation

Assistant Manager

Executive Production

Officer Production

Operators Production

Workers Production

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2.2.3 MAINTENANCE DEPARTMENT

The maintenance department is one of the supporting departments of production in akay. The other utilities such as boiler, treatment plant, cooling water plant, chilled water plant, water treatment section and electrical and diesel generator section are also under the maintenance department. The main aim of maintenance department is to make sure that all the machineries are in smooth working condition and there would be no interruption in the production. The maintenance department of AkayFlavours& Aromatics Pvt. Ltd is responsible for: 1. Preventive maintenance 2. Break-down maintenance 3. Shut-down maintenance 4. Ensure availability of spares

5. Safety Precautions
Preventive maintenance: this involves regular check up of the machineries and the plant equipments are done in daily and weekly manner. It is to ensure that there is no longer problem with the machines and the production will not be interrupted. Daily oiling and greasing are done as the part of preventive maintenance. Preventive maintenance help to avoid machinery break down and production delay. Break-down maintenance: during the production, if there is something wrong in the machineries, instant services are given and make sure that the production will not interrupted. Break down maintenance is not being done as per the break down procedure and to take all precaution to avoid any accident and minimize the production delay. Shut-down maintenance: shut down maintenance is given in the yearly basis, that is once in a year all the machineries are shut down and all the maintenance work which are to be done in that time. Any replacement of equipments or machinery is necessary is also done in the same time. Availability of Spares: It is vital to ensure the availability of spares for any kind of maintenance activities. Maintenance department keeps a close contact with the

purchase department and stores for ensuring the availability of spares.

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Safety Precautions: For carrying out a maintenance work safety precautions must be taken to avoid unnecessary accidents. For each work permits are requested to production department. It is their duty to isolate the area and issue work permit. All electrical and mechanical connections are isolated from the area under work. After the completion of work completion report will be issued to production department describing the works done, manpower and spares used.

Functions of Manager, Maintenance Department

Project discussion with suppliers Maintenance plant Bill passing Follow up with other departments Cost saving proposals Energy saving/ modifications for improvement Break downs monitoring Maintaining legal requirement pertaining to maintenance department Effective utilization of man power Checking work bill done by electrical contractors

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Structure of Maintenance Department

Manager Project & Engineering service

Assistant manager Maintenance

Executive Maintenance

Junior Officer Maintenance

Junior Officer Maintenance

Junior Officer Maintenance

Technicians Maintenance

Technicians Maintenance

Technicians Maintenance

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2.2.4 QUALITY ASSURANCE DEPARTMENT

Quality assurance is the process of verifying or determining whether product or services meet or exceed customers expectations. Quality assurance is a process driven approach with specific step to help define and attain goals. This process considers design, development of product and services. The main analysis involves in the quality control are: 1 2 3 4 5 Raw material analysis In process sample analysis Blending and final sample analysis Customer sample analysis New product and trial sample analysis

The quality assurance department performs the following function at akay 1. It investigates in to the quality of the raw materials used in manufacturing

process. In each stage of production sample taken and makes sure that the quality is properly assured. Testing for quality starts from the procurement of raw material, quality of product is checked in the lab by experts with the standards set. If any deviation is seem in the quality of the product from the standards then the product is rejected or measures are taken to bring back the product into the original standards. 2. It helps in preparing samples of the product for the customers. The customer

provides their specification about the product to the company and quality assurance department prepare sample as per the required specification and the same is sent to the customers. If the customer is satisfied with the sample provided they place an order with the company for the supply of the product with the required quality and this order is sent to the production department. 3. This department plays an important role in monthly planning and shipment of

product to the potential customers. The finished product is dispatched at the right time as specified by the customer. 4. This department also checks the quality of the packing materials which is used

to pack the finished product before it is dispatched to the potential customers. The materials are packed properly to avoid any damage during the transit and also to maintain the quality and flavor of the product.

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5.

It plays an important role in correcting a technical or cosmetic flaw. Before

dispatching a product to the potential customers a sample of product is retained by the department.

Structure of quality assurance department

Manager QA

Assistant Manager QA

Officer QA

Lab Assistant QA

Lab Assistant QA

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2.2.5 MARKETING DEPARTMENT

This company has separate marketing division is USA, JAPAN, CHINA, EUROPE. They have wide and string marketing network all over the world. The company has no local marketing as the potential customers are located outside our country. The promotion strategy of the company is giving advertisement in food magazine, taking fast food exhibition in worldwide etc. The annual turnover of the company around 150crore and the company is expecting turnover of 160crore for the next year.

Market Segmentation
A market segment is a group of customers who share similar set or a group wants. The market is segmented on the basis of certain variable such as geographic, demographic, psychographic and behavioral. Akay segment their market in a geographic wise. For geographic base segmentation they consider the following factor: a. Regulation of countries b. Behavior of buyers The market strategy varies according to each counties rules and regulations.

Pricing Strategy
There are several strategies that are typically used to determine pricing for a product or products live. The objective of pricing strategy include gaining the market share, achieving financial performance, repositioning the product, stimulating demand and influencing the completion. Standard pricing include cost based, going rate, target profit, cost plus and break even. Akay follows cost plus pricing strategy. Determining the breakeven point (by calculating the fixed and variable cost that go into producing the product) will give a price floor. By selling the price just above the basic price (cost plus pricing), earn profit and should remain competitive in the industry. This is known as cost based, cost plus or breakeven pricing.

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Since the company is a 100% EOU, there is certain procedure for exporting their goods. Some of the documents required for the export of goods are: o Invoice o Packing list o Bills of lading o Certificates its origin o Certificates of analysis

Structure of Marketing Department

Manager Marketing

Assistant Manager

Executive Marketing

Executive Marketing

Executive Marketing

Sales Officer Marketing

Sales Officer Marketing

Sales Officer Marketing

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2.2.6 FINANCE DEPARTMENT

The major activity of the finance department is data entry, book keeping, preparing budget etc. the financial year of the company starts from 1stApril to 31st March. The company is now running in a safe position. The company has a cash credit with SBT. The finance department verifies all the bills passed by various departments and the bills are cleared, either on the same day or some of the customers have credit for one month.

Functions of Finance Department

Preparation of cash flow budget ( monthly, quarterly, yearly ) Preparation of capital expenditure budget Preparation of revenue budget Budget variance statement ( monthly, quarterly, yearly ) Costing statements Standard costing statements on yearly basis Preparing monthly profit and loss account and balance sheet on or before 5th of every month o o Banking Working capital loan management

Cash flow management: They provide periodic performance to the bank and also they renew their working capital facility every year based on Credit Monitory Account (CMA) statement. Company budget is made by the financial manager, including production, purchase, and sales.

The company give credit facility to pre-shipment and post-shipment credit period allowed for the customer is 30 to 60 days Accounting: it start with data entering, source of data with documents accounting is done according to the amount manual of the company, and accounting also follows the policies and procedures of the company o o Consolidation Finalization of account done alter ledger totally

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Structure of Finance Department

Manager Finance

Deputy Manager

Deputy Manager

Deputy Manager

Deputy Manager

Assistant Manager

Assistant Manager

Executives Executives Executives

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2.2.7 RESEARCH AND DEVELOPMENT DEPARTMENT

In akay the research and development department is divided in to two. They are: 1 2 Seasoning division Neutraceuticaldivision

This department plays an important role in this organization. They do a research on the customer requirements and after receiving the input provide samples to the prospective customers. They make a blend of flavors so as to meet the customer requirement.

Areas of Research and Development Department

New product development Product and process development Instrumentation and process control Improve process and product quality New packing techniques New process method Invention and implementation of process technique

Structure of Research and Development Department

Manager R&D

Assistance Manager

Executive R&D

Officer R&D

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2.2.8 HUMAN RESOURCE DEPARTMENT

Human resource is like any other natural resource. It means that management can get and use the skill, knowledge, ability etc., through the development of talents, tapping and utilizing them again and again. When individuals come to work place, they come with not only technical skills, knowledge, experience etc., but also with their personal feelings, perceptions, desire, motives, attitudes, values etc., thus, an important element of HRM is human approach while managing people. This approach focuses of Human Resource Development on one hand and effective management of people on the other hand. HRM approach is a fundamental change in philosophy and perspective from the earlier through about manpower resource. It thus emphasize on the human aspect of individual workers and their aspirations and needs. It is thus management function that helps managers recruit, select, train and develops members for an organization.

Objectives
The primary objective of HRM is to ensure availability of a competent and willing workforce to an organization. Specifically the HRM objectives are four fold namely, societal, organizational, functional and personal. Social objectives: To be ethically and socially responsible to the needs and challenges of the society while minimizing the negative impact of such demands upon the organization. The failure of organization to use their resources. Organizational objectives:To recognize the role of HRM in bringing about organizational effectiveness, its only a means to assist the organization with the primary objective. Personal objective: To assist employees in achieving their personal goals, at least so far as these goals enhance the individuals contribution to the organization. Personal objective of the employees must be met if the workers are to be maintained, retained and motivated. Otherwise employees performance decline and may leave the organization.

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Human Resource Planning

Akay flavors give more stress on manpower planning. The manpower planning is done every month. The respective department prepares a strength report every month. The chart shows technical, skills and qualification capability of each worker. Coleman has defined Human Resource or manpower planning as the process of determining manpower requirement and the means for meeting their requirements in order to carry out the integrated plan of the organization.

Benefits of HR Planning
1 Upper management has a better view of human resource dimensions of business decisions. 2 Personal costs may be less because management can anticipate imbalance, before they become unmanageable and expensive. 3 4 More time is provided to locate source talent. Better opportunities exist include women and minority groups in future growth. 5 6 Better planning of assignments to develop manager can be done. Major and successful demands on local labour market can be made.

Process of Human Resource Planning

The process of human resource planning is one of the crucial, complex and continuing managerial functions, the multi step process are as follows: 1. Deciding goals or objectives 2. Estimates future organizational structure and manpower requirements 3. Auditing human resource 4. Planning job requirements and job descriptions

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Recruitment and Selection

According to the needs, the department head decide a new replacement. After the approval from the management, applications are then invited by the HR department for the vacant seats. The application so collected is then scrutinized depending upon the merit, skills and ability of the person. The short listed applicants are then called for interview which is conducted by the interview committee. They are again listed and called for the final interview. The selected candidates then undergo the necessary formalities such as medical check-up, induction; training etc. The company also invites application from Local Employment Exchange, Institutes as Government Apprentices. The eligible candidates are then scrutinized and undergo all the necessary formalities, such as medical check-up, written test appointment & contract letters etc. There is a separate training program for the Apprentice Trainees.

Training and Development

Training is very much essential for workers as well as officers and managers because it increases the efficiency in the work & also confidence in its employees. Thus AKAY Flavors is engaged in giving effective training to all its employees. The programs are so designed and arranged to fulfill the needs of various levels. Thus depending upon the needs, training programs are held. An annual budget is prepared by HRD Department for training. The key areas for which training is needed are identified. Job evaluation of the Performance Appraisal forms is done by the respective department and nomination for the below mentioned training are made. After completion of necessary training a feedback session is there and the necessary information of the training is recorded. The training programs are divided into: In-House Training Program External Training Program Training Program Abroad

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In-House Training Program The perspective department makes the identification of the need for training. The HRD department plans and organizes the training program. The department head or the persons who are experts in these fields generally impact this type of training. If necessary outside agencies are also invited for providing the respective training. There is a feedback and recording of the training. External Training Program The concerned departments prepare the external training program. The respective department then nominates the persons for training. The HRD department then does the registration formalities. The person nominated for the training has to undergo a contract. During training the necessary information is imparted to the concerned employees of the company and then evaluation of records of training is done. Training Program Abroad The HRD department organizes for other program such as workshops, seminars and conference. The brochures from various institutions are also invited for. The HRD departments get the approval from the managing directors and makes necessary arrangements for such programs. The information to all the concerned departments is given regarding these programs. Training programs are formulated on experimental and control group basis, feedback is taken in order to check the effectiveness of the training program.

Induction
A normal induction program is to be undergone by each and every newly joined employee of the organization. The induction is done under the supervision of a guide by respective department where induction is to be taken place. During induction the new entrant is generally imparted training and necessary job information. He has to undergo job rotation in order to understand the entire function at his level. He is also explained the discipline and work culture and satisfy rules of the company.

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Development
Development of a person is given prime importance, as AKAY Flavors believes in the growth of an individual in all walks of life. They have library which has an excellent collection of books ranging from technology to light hearted reading. Development in a board sense is the formal approach taken by the organization to ensure that people with the proper qualification and experiences are available when needed. Individual development and human recourse planning is highly interrelated. A proper conceived and executed program of development serves the betterment of individuals, the organization and society. There are various awareness programs such as family planning program; meditation where the employees are given the pros and cons of a large family, thus social objective is taken care off. According to AKAY, education is vital absolutely necessary to reach the ladder of success and thus the company for further sponsors many of them. AKAY is providing facilities for higher education to the employees and the company is giving 50% of the expenses of the course. Thus an applied education on training program is organized by the HRD department for the employees from the respective department.

Performance Appraisal
Performance appraisal has been considered as the most significant and indispensable tool for an organization. It provides highly useful information which helps in making decisions regarding various aspects such as promotion, transfer etc. Performance appraisal is a continuous process and not merely an issue of formal reports at particular point of time. It is an ongoing responsibility of the supervisor to determine how effectively his subordinates are performing different tasks allotted to them in their position to identify and correct their weakness, strength, so that they could be considered for promotion. The performance is appraised by the appraiser and also by the divisional head of the appraiser. The key performance areas and targets are to be set the beginning of the year and assessed at the end of the year.

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Structure of Human Resource Department

Manager HR

Executive HR

Officer Administration

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3. SWOT ANALYSIS
After interacting with the department heads and the top management and other staff in Akay Flavours & Aromatics Pvt. Ltd, a SWOT Analysis of the organization was performed to identify the strengths, Weakness, Opportunities and Threats of the concern. The SWOT analysis of Akay Flavours & Aromatics Pvt. Ltd. is as follows:

Strength
High Quality Product Akay Flavours & Aromatics Pvt. Ltd is having its own research and development team. The company have R&D department with a manager and assistant. They develop new Products on their own plant. The main success of the firm is their products are with high quality. Modern And Automatic Machineries As a part of innovation they use modern and automatic machineries compared with other competitors. Managed By Team Of Professionals The main strength of the firm is managed by high competence level of employees. The management and workers both strives to create a responsible attitude and productive atmosphere. High Demand For Product From Europe And USA Other strength is largest supply and marketing division in different countries especially from Europe and USA.

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Weakness
Seasonal Raw Materials The main weakness of the firm is their seasonal raw material like Red Chilly, Paprika etc. Huge Transportation Cost The plant is located in the rural area and there is a difficulty of transportation. The company has to pay a huge amount as transportation cost for raw material brings to the warehouse, distribution of goods. Electricity Problem Frequent power failure affects the production of the company.

Opportunities
Very Few Companies Are In The Same Fields There are few companies such as AVT natural product Ltd, Tata Spices etc in this field. So there is a great opportunities to increase their production and sales both inside and outside the country. Making The Product Available In India This is an exporting company. They have no sales and distribution in India. Globalization Increased The Opportunities For The Export Of Oleoresins Globalization increases the opportunity of sales and distribution of every organization. It makes the product available for the whole world.

Threats
High Price Cost such as transportation cost, manufacturing cost, export duty etc will increase the ultimate price of the single finished goods. Artificial Colors And Flavours Availability of Artificial colors and flavours affect the marketing of the natural colors and flavours.
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CONCLUSION
This organization study was an attempt to study the organizational structure and the department functions and to provide an analysis on the basis of SWOT regarding the functioning of the organization. The data with regarded to the study collected from the AKAY Flavours and Aromatics pvt Ltd helped to understand the manufacturing process. Each department in AKAY Flavours and Aromatics Pvt Ltd was analyzed in detail.

AKAY Flavours and Aromatics pvt Ltd has seventeen years of experience and goodwill in the industry. The study helped to familiarize with the functioning of the firm. The study provided an understanding of the department and managerial functions of the organization in the real business world, keeping in mind the theoretical knowledge provided by management professionals and experts in the academic curriculum.

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BIBLIOGRAPHY

www.akay-group.com www.indianspices.com www.spices.res.in Company manuals,AkayFlavours& Aromatics Pvt.Ltd Annual report of 2010-11 Marketing management ( Philip kotler)

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