1

26-August-2016

NISHAT
MILLS
LTD.

FINAL PROJECT HRM ( DEVELOPMENT AND

TRAINING

Group members:
Muhammad Sabeeh Ul Hassan
Hamza Ali
Usman Khalid
M. Imran Naeem

PMBA section A , First Year

Table of Contents
List of Figures........................................................................................................................................ 3
Abstract:................................................................................................................................................. 4
Introduction: .......................................................................................................................................... 4
Mission: ................................................................................................................................................. 5
Vision: ................................................................................................................................................... 5
Nishat Over the Years: .......................................................................................................................... 6
SWOT analysis of Nishat: .................................................................................................................... 6
Training and development Process in Nishat mills: ............................................................................. 8
Recruitment and Selection process: ...................................................................................................... 9
Selection and Recruitment process in Nishat Textile: ....................................................................... 12
Identifying Need or Requirement: .................................................................................................. 12
Interviewing and Testing Candidates: ............................................................................................ 12
Suggestions for testing the employee before hiring: .......................................................................... 13
Worker skill analysis report ................................................................................................................ 14
Retaining Employees: ..................................................................................................................... 15
Suggestions for Training Need Analysis: ........................................................................................... 15
Methods to train employees: ........................................................................................................... 17
On-the-Job Training .................................................................................................................... 17
Job Rotation/ Apprenticeship training ........................................................................................ 18
Job Mentoring/ Job instruction training ..................................................................................... 18

List of Figures

Figure 1 . Literacy rate of employees ................................................................................................... 8

Figure 2 . Department wise employees distribution ........................................................................... 9

Abstract:

Staffing is an important pillar for the management process in the companies where the numbers of
employees are far greater than smaller companies. Human resource management department in any
organization is responsible for the policies and practices; that involve human aspect of
management position including recruiting, screening, selection, training, rewarding and appraising.
Textile industry is worker rich industry in Pakistan and the number of employees in the textile mill
is more than any other established industry in the country. Textile industry has an overwhelming
effect on Pakistan economy and it contributes more than 50 percent in the total exports of the
country. In this research we will look into the Human resource management in a textile industry
and will analyze how the HR policies are helpful in the achieving the organizational goal and how
these policies can be further improved to upraise the efficiency and efficacy of work methodology
of employees. The complete Training and Development system of a Textile mill will be critically
analyzed in this paper.
This paper comprises two parts; in the first one we will discuss the Human resource management
practice for training and development in the Nishat mills Ltd then in the second part we will
analyze the potential gaps and make suggestions for improvement in the current policies.

Introduction:

Nishat has grown from a cotton export house into the premier business group of Pakistan with 5
listed companies, concentrating on 4 core business; Textiles, Cement, Banking and Power
Generation. Today, Nishat is considered to be at par with multinational operating locally in
terms of its quality products and management skills. Company has an Annual turnover of 17
billion rupees in which 14 billion is from textiles. It earned foreign exchange of US $ 236
million and pays taxes and Levis of 2,080 million rupees annually.

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NML total export for the year 2009 is 38.8 billion rupees. Due to the application of prudent
management policies, consolidation of operations, a strong balance sheet and an effective
marketing strategies, this trend is expected to continue in the years to come. The
companys production facilities comprise Spinning, Weaving, Processing, Stitching, and
Power Generation. Nishat Mills Ltd. Spinning division today has 1, 73,000 spindles working
in 9 units.

Production of different qualities of yarn (more than 100 different types) using natural and
artificial fibers with production capacity of 64.713 million kg of yarn per annum. There is
average daily consumption of138,000 kg of local cotton and 20,000 kg of imported cotton
(Brazilian, Russian, Uzbek, Afghan, Indian, Egyptian, and American Upland cotton).Out of total
cotton purchases around 90% purchase is from local market and 10% is imported.

Mission:

To provide quality products to customers and explore new markets to promote/expand sales of
the Company through good governance and foster a sound and dynamic team, so as to achieve
optimum prices of products of the Company for sustainable and equitable growth and prosperity
of the Company.

Vision:

To transform the Company into a modern and dynamic yarn, cloth and processed cloth and
finished product manufacturing company that is fully equipped to play a meaningful role on
sustainable basis in the economy of Pakistan.
Also to transform the Company into a modern and dynamic power generating company that is
fully equipped to play a meaningful role on sustainable basis in the economy of Pakistan.

Nishat Over the Years:

Lets take a look of the company progress over the span of 60 years
1951

Nishat Mills Limited commenced its business as partnership.

1959

The company incorporated as private limited company.

1961

Nishat Mills Limited was listed on Karachi Stock Exchange.

1989

The Company was listed on Lahore Stock Exchange.

1992

The Company was listed on Islamabad Stock Exchange.

1996

Acquired the operating assets of Nishat Tek Limited and Nishat Fabrics Limited.

2005

Acquired the assets of Umer Fabrics Limited.

2008

Acquired the assets of Nishat Apparel Limited.

SWOT analysis of Nishat:

Strengths:
1. Nishat is one of the largest textile composite units in Pakistan.
2. Nishat is ISO 9001 and IKO-TEX 100 certificate holder.
3. It has one of the highest credit rating by PACRA.
4. Nishat has its self-owned power plants.
5. Nishat has one of the largest Fabric dyeing facilities in south East Asia.
Weakness:
1. Nishat mostly rely on international market.
2. Nishat incurs a relatively high cost of production.
3. Employees turnover is comparatively high as compare to its competitors.

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4. Nishat has more transit time when compared with international market.
Opportunities:
1. It can expand its product line from domestic to industrial clothing.
2. It can reduce the cost by prudent use of the resources.
3. It can invest more in its Human resources and can hire more educated and trained
personnel.
4. It can shift to domestic market for branded ready-made garments.
5. It can invest more in emerging mall culture and retail expansion.
6. Nishat should try to implement the latest ISO standards including ISO14000series, which
will improve their image and customer satisfaction in the local market as well as in
international market.
7. Nishat can introduce its garments to local market by using the same stitching unit.
Threats:
1. Todays shortened fashion life cycle is a great threat to Nishat.
2. It has to encounter stiff competition from other big countries the Asia like china and India.
3. It can have disadvantage in form of its production plants location.
4. Government is focusing on the industrialization and is giving different incentives to the
investors. It is also a big threat because the number of competitors will increase.
5. More and more competitors (National and International) are entering in the same markets
and offering attractive prices to the customers.
6. Currency fluctuations, exchange rates and Government applied GST can also create
problems for Nishat mills.

Training and development Process in Nishat mills:

Before we discuss and analyze the training and development system in the organization it is
necessary to understand the number of employees and to have a brief overview of different
departments in the mill firstly.
Employees Profile:
Nishat mills unit # 27 has total workers strength of 728 employees. Following figure describes the
literacy rate of the employees in the mill according to Pakistani education system.

Figure 1 . Literacy rate of employees

If we take a look on the distribution of employees in the department we will notice that mostly the
employees are falling in maintenance and production department category which is typically more
technical department in the mill.
Before analyzing training need in the mills we will see in the below figure#2 which is showing the
number of employees working in different major departments of the organization.

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There is an administration department which covers all the aspects of human resource function .In
the Nishat mill Unit # 27 there is no any proper and well established Human resource department.
However, the administration department is doing most of the service of employees recruitment,
wages, daily attendances, overtime, health and safety etc.

Department wise distribution of employees

500
450
400
350
300
250
200
150
100
50
0

No. of Employees

Managers

Accounts
and stores

15

Maintenance Production
depart
depart
167

437

Quality
depart

Electrical
depart

80

23

Figure 2 . Department wise employees distribution

Recruitment and Selection process:

According to a careful analysis (data provided by administration department of the mill),
employees turnover ratio for the last 6 months is about 4.5% per month. That means almost 32
employees are leaving the mill every month and the same amount is employed every month. This
figure is quite disastrous when we compare with other organizations, however, in most of the
textile mills this culture is considered normal.
Typically, in Nishat textile unit # 27 the recruitment from advertisement is almost equal to none.
From most senior employees to the lowest level employee Employees referral procedure is
followed. The recruitment form properly have a column in which new employee has to mention
about its referee.

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If the person has applied for technical job then in some cases job related test and interview is
conducted which is very informal in the form and require no proper documentation. For example if
a mechanical supervisor is applying for the job then the managers might ask him to do a specific
task on the machine and he would ask some questions that will judge the technical and
technological knowledge of the candidate about the machines.
Interviews:
Informal interviews are very common and are the only type of interview for selection process. No
formal interview and panel is set up accordingly as we have discussed previously the employees
turnover rate is high and top managers mostly rely on referred candidates and in most cases the
supervisor of the department is responsible for hiring the employee and completing the strength of
his workers.

Orientation of employees:
After hiring the employees, employees should be welcomed properly so that they can feel
comfortable and at ease. Unfortunately, this orientation process is not carried through proper
channel. However, newly hired employees are welcomed by their supervisors and are told by them
what is expected from them in work and behavior.
Training needs analysis:
Training needs analysis involves task analysis and performance analysis.
In Nishat mills training analyses is carried through interviews, observations, performance
appraisals and job related performance data.
Following table is summarizing the training methods and their application in the mills.

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Table 1. Different methods of training

Training method

Used / Not used

On the job training

Used

Apprenticeship training

Used

Informal learning

Used

Job instruction training

Used

Lectures

Occasionally used

Programmed Learning

Not used

Audio visual training

Not used

Simulated training

Not used

Computer based training

Not used

Electronic performance support

Not used

system
Distant and internet based training

Not used

On the job training is most widely used training methods in the Nishat mills ltd. Production and
maintenance departments use this kind of training for enhancing the skill level of employee.
For the assistant managers and middle managers the training is mostly done by job rotation. For
example the assistant managers are bound to change their concerned departments and span of
control consequently after every two years.
Lectures are used by external clients .There is a proper meeting room and conference hall. Outside
visitors and trainers use to come there and train the maintenance department about their product.
For instance, if a lubricant company wants to extend its sales it will give sample of its product to
run on trial basis and it will give training by lectures and presentations and videos to the
maintenance department about how to use the product correctly and how to effectively carry out
preventive maintenance of machines.

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Selection and Recruitment process in Nishat Textile:

As already discussed that recruitment and selection process is very informal and the main reason
behind this is high turnover especially in labor class, like machine operators and foreman in the
production department. Due to this issue managers have to hire almost 32 employees every month
which means they hire one person daily on an average. So they try to make this process as quick as
possible to avoid any disruptions in the production department.
The procedure of recruitment and selection at every stage is discussed below:

Identifying Need or Requirement:

In most developed organizations HR department does the need analysis through proper
employment planning and forecasting. But in Nishat line manager or technical supervisor does this,
and put a requirement for hiring a new person. In most of the cases this requirement is generated
when an employee leaves the organization, as mentioned before Nishat has a very high turnover
rate. But sometimes additional employees are also required when a new machine is being
purchased or a new project is starting etc. So when the line manager or the supervisor identifies a
need for hiring they start building a pool for it and initiate the hiring process after getting an
approval from their senior manager.

Interviewing and Testing Candidates:

Interviewing takes place for two types of employees, first type is when hiring candidates for
management positions and second type is when hiring skilled workers. Hiring at both levels is
mostly referral based and interviews are informal at both the levels. When hiring for management
positions mostly top level managers take the interview, but these interviews are again not
structured. If the position is technical then they test they candidate on various technical skills and
abilities. They also take unstructured tests when needed to determine the technical knowledge of
the candidate. If the position is nontechnical then they mostly rely on informal and unstructured
interview to test the general skills abilities of the candidate.

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When they are hiring for labor positions they take short and informal interviews and sometimes
they also conduct simulations on machines to test the knowledge of the worker on machine. They
ask them to operate the machine in a certain way to check his abilities and knowledge of the
machine.

Suggestions for testing the employee before hiring:

For testing the employees we have developed ourselves a sample testing format for a specific
department of the mill which they can use for testing the skill of employees before hiring them on
regular basis. Below is the sample of the skill test.
We have developed the test given on the next page by asking the required traits in the employees
from managers. This test should be conducted by the supervisor and he should duly fill the form of
test.
This test can be introduced as a standard of testing, before hiring any employee of specific
department the department should be responsible for conducting the test and then giving verdict
about the skills of employee. This initiative can give better and programmed data about the
employees which can also be utilized as a record in future.
Below sample test is typically showing the required traits in a 4/sider and a 6/sider employee of the
ring department. In the test page required skills are given and then the level of employee for the
skills should also be recorded against them.
This will give a systematic view of employee skills and then employee can be accepted or rejected
based on his level of skills.
Table below is showing a typical test for ring department employee who will be candidate for
4/sider or 6/sider designation in the ring department (production) of mill.

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Worker skill analysis report

Depart: Ring
SKILL

Date: __________
Unit of

Maximum

measurement

points

Piecing of yarn

per minute

12

Mounting of Gripper

per minute

per minute

12

Obtained points

released

Salai
H.Roving Piecing

Good(1 ) ,

poor(

0)
Machine Signal Lamp

Good (2) , poor(0)

Good (2) ,Avrg.(1),

awareness

Working method

poor(0)

Total Points
Previous experience :
Recommended standards
Employee designation

Piecing / min

Salai / min

4 sider

8~ 10

12 ~ 16

6 sider

12 ~ 14

14 ~ 18

Checked and verified by:

Final Verdict:

Head Of Department

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Retaining Employees:
As we have already mentioned that Nishat has a high employee turnover ratio so retaining new and
existing employees has been an issue with Nishat so far. However, this type of turnover is
somewhat common in mills culture but Nishat has to face a lot of problems and bottlenecks due to
this issue. They also incur extra costs and production constraint issue due to high employee
turnover. This high turnover is mostly common in labor class, so Nishat has to come up with an
effective strategy to retain their workforce.
There can be many effective ways of retaining employees but most common and effective method
of retaining employees especially labor class is high salaries and job security. Most of the
workforce of Nishat belongs to middle class of society and low salaries and insecurity of job is
their major concern, and if the management of Nishat can come up with effective policies and
strategies to tackle this, they can surely reduce their turnover rate.

Suggestions for Training Need Analysis:

A training need is a shortage of skills or abilities, which could be reduced or eliminated by means
of training and development. Training needs hinder employees in the fulfillment of their job
responsibilities or prevent an organization from achieving its objectives. They may be caused by a
lack of skills, knowledge or understanding, or arise from a change in the workplace.
Training needs analysis identifies training needs at employee, departmental or organizational level
in order to help the organization to perform effectively. The aim of training needs analysis is to
ensure that training addresses existing problems, is tailored to organizational objectives, and is
delivered in an effective and cost-efficient manner.
Training needs analysis involves:

Monitoring current performance using techniques such as observation, interviews and

questionnaires
Anticipating future shortfalls or problems
Identifying the type and level of training required and analyzing how this can best be
provided.

We can conduct a training need analysis by following these steps

1. Anticipate future needs:

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Training needs often appear at the organizational or activity level. For example, the
arrival of a new office or workshop equipment may well have training implications for
everyone using it.
Alternatively, an organization that decides to enhance its level of customer service as
part of a corporate strategy knows that a program of training and development is
essential for its success.
2. Develop monitoring techniques:
Some training needs can go unnoticed because they creep up on the organization
gradually. Active monitoring systems are essential to spot these and can make a
valuable contribution to the process of collecting information on performance gaps and
training needs.
Variance analysis is one approach to monitoring. It translates precisely to the identification
of training needs. When a budget is agreed, expected monthly expenditure is detailed. Any
major variance from the forecast - upwards or downwards - triggers an investigation into
why it happened and what the implications will be.
Asking questions at appraisal interviews can act as a form of survey, as the same issues are
being addressed throughout the organization. Identifying training needs is one purpose of
appraisal. In addition to training needs that emerge as a result of an appraisal interview, a
worthwhile approach to investigating one-off problems is to interview staff and customers.
Regularly ask a random sample of people for their views on the same set of questions
relating to general performance - for instance customer satisfaction levels.
3. Identify the level of need:
It could be that a training need is limited to a single individual or activity but it is
more likely to be relevant for a number of people, a whole department or across the
organization. For example, if the organization traditionally treats customers as a nuisance,
it needs to change its overall approach. In this case, giving one or two people training
would address the training need at the wrong level; organization development is needed
rather than individual training sessions.
4. Take appropriate action:
If the training needs are within the span of control, probably at individual or maybe at
activity level, we can plan action to meet the needs. If the needs are broader, we will
need to make recommendations and proposals to those responsible for planning and
implementing training interventions in the organization. This may involve drawing up a
report specifying the training needs which are identified, recommendations for meeting
them and the expected benefits of the training.

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We can implement better and continuous training for employees by periodically running training
need analysis, having informal meetings with employees, evaluating timelines of projects assigned
in the organization. With time need to acquire new skills and to update existing skills is required by
both employee and organization. Continuous training help employees avoid making mistakes that
result from their lack of information and knowledge but they also help the company increase
employee retention, gain their loyalty, and ultimately boost organizational productivity.
Continuous training provides following benefits
1. Address weak links
2. Increase employee retention
3. Boost employee retention

Methods to train employees:

There are several different types of training methods used to prepare an employee to a new
job or even to a new position within his current organization. Those used in Nishat are discussed
below
On-the-Job Training
On-the-job training allows employees to learn by actually performing a specific job or task. Onthe-job training can be structured by using hands-on application supported by classroom-type
instruction. It can also be unstructured using only hands-on application.
For instance, if Nishat has hired a new maintenance manager, he can be trained on the different
types of machinery in the mill. Lets assume that manager has no experience on Swiss-made
machinery and has all exposure about Japanese machine of that department. He can be given
training about the working method of machine which is unfamiliar for him. He can be trained on
the job about how to operate the display panel, how to give different settings, his supervisor can
tell him about the overhauling of machine; doing it by himself.

The advantages of this method are:

a. Immediate feedback on performance
b. Swift remediation if task is not performed to standard
The disadvantages of this method are:
a. Can slow down production for the trainer

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b. Can disrupt the workflow
Job Rotation/ Apprenticeship training
Job rotation teaches current employees how to do various jobs over time. The employee will rotate
around to different jobs within the organization, performing various different tasks unrelated to his
original job.
Assume that Nishat has hired a helper for maintenance department of ring spinning. After a year he
should be rotated to another department e.g. transferred to carding and blow room department. This
rotation will increase the skill level of the helper and will help also the organization to fill the
vacant position in the company with more skilled employee if required.

The advantages of this method are:

a.
b.
c.
d.

Reduces employee boredom

Increases skills
Opens new opportunities to employees
Hones in on employee interests

The disadvantages of this method are:

a. Employee may not be satisfied with the new rotation
b. Employee morale may decrease if employee is moved for a long period of time
c. Can disrupt the workflow as employee learns new task or job

Job Mentoring/ Job instruction training

Job mentoring involves providing an employee with an experienced coach to oversee his or her
learning experience. The mentor or coach provides advice and instruction, but is not performing
the job with the employee as in on-the-job training. The trainee employee learns the job firsthand
and may consult the mentor or coach at any time for assistance.
Job mentoring can be very easy task in Nishats textile culture, because of the span of the control in
the management. This covers both aspects from management to unskilled employees. If we take a
look on the span of control, there is supervisor or shift in charge on every 25 employees that is
monitoring the performance of his subordinates.in this culture job mentoring is very easy and takes
place by itself if the supervisors are properly trained about how to be a good leader and divert the
energy of employees to contribute in the profit and goal of organization.

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Three ways to measure training effectiveness in Nishat:

Visual Confirmation
In traditional trainings, learners demonstrate their knowledge by performing a role-play.
Technology allows us to take role-plays a step further. Instead of demonstrating knowledge that
may or may not be true to the learners job, learners now have the ability to share visual
confirmation theyve completed a task in real life.
1. Social Ownership
The ability to teach others is one of the highest forms of mastery of a subject. Social Ownership
puts learners in the position to teach others by showing how they apply concepts in their real
world. This concept not only engages employees to teach and learn from each other, it also gives
training managers the ability to measure how well concepts are being implemented within the
organization.
2. Skill Assessments
Creating a visual assessment of an employees skill set and performance before and after a training
moment. These snapshots, or skylines, of a learners abilities can give a clear picture of
performance and skill improvements you can directly tie to training. A simple example would be,
testing a sales persons current sales skills prior to training, then retesting the individual after the
event to see the delta. There are so many improvements going on in this area right now because of
data analytics, its a good one to jump on ahead of the curve.