Mm Ispahani Limited 1u482o

EXECUTIVE SUMMARY

This report is prepared to study the management of M. M. Ispahani Ltd. Here in this report we looked at the basic management of the company with respect to certain characteristics. They are as follows • • • •

Innovation Financial Performance/ Productivity Company Management Contribution to the Community

After looking at these aspects of the report and findings, we get a clear and practical concept about the management system of a company with its long organization structure. We have looked into the strengths and flexibility of Ispahani Ltd by going into the two most important product line which contribute most to the profitably of the company, that is Pahartali Textile and Hosiery Mills (PTHM) and Tea Blending and Packaging factory. We have gone into both Office and factory to Ispahani Ltd to see and analyze how both side of an organization coordinate and function. And finally this report contains final thoughts about the management of M. M. Ispahani Ltd and our comment on the sustainability of Ispahani Ltd in of the award that they received in 2003 and has the company moved forward or backward from where they were then.

TABLE OF CONTENTS

1. BACKGROUND OF THE COMPANY.................................................................6 2. COMPANY VISIT...................................................................................................7 3. CRITERIAS FOR SELECTION ...........................................................................7 Innovation..................................................................................................................7 Financial Performance/Productivity........................................................................8 Company Management.............................................................................................9 Contribution to the Community..............................................................................12 4. RECOMMANDATIONS, COMMENTS & SUGGESTION ............................13 APPENDIX.................................................................................................................14 REFERENCE.............................................................................................................18 BIBILIOGRAPHY.....................................................................................................19

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1. BACKGROUND OF THE COMPANY: M M ISPAHANI LIMITED Address: Head Office: M.M.Ispahani Limited, Ispahani Building, Sk. Mujib Road, Agrabad C/A, Chittagong-4100. Tel: +880-31-716153-6 (PABX) Corporate Office M.M.Ispahani Limited, Ispahani Building, 14/15, Motijheel Commercial Area, Dhaka-1000. Tel: + 880-02-9555192 Branch Office M.M.Ispahani Limited, Ispahani House, 28, Khan-A-Sabur Road, G.P.O. Box No.3, Khulna. Tel: +880-41-720964 The Ispahani Group is one of the most successful and respected business houses in Bangladesh. The company has corporate offices in Chittagong, Dhaka and Khulna. Through its tea, jute match, textile, property, poultry and shipping divisions the Group employs approximately 20,000 people. Today after 175 years of business in the sub-continent, the house of Ispahani is still dedicated to the cause of excellence in providing high quality goods and services. Mirza Ahmed Ispahani (1898-1986), the eldest son of Mirza Mohammed Ispahani ed the partnership in 1918 and established the private limited company, M M Ispahani Ltd in 1934 along with his younger brothers. They moved the corporate headquarter to Chittagong from Kolkata. It was under the visionary leadership of Mirza Ahmed Ispahani that the company rapidly expanded its business. By 1947 M M Ispahani Ltd was the foremost exporter of Shellac, Kapok, Hessain, Jute Bags, Tea and Chemicals. Today, the company -- still continuing in its private limited structure -- is involved in numerous sectors as diversified as textiles and tea, real estate and poultry, shipping and internet services. It has corporate offices in Chittagong, Dhaka and Khulna employing more than 20,000 people in its various concerns. The founding family is still very much hands-on involved in existing and new businesses. Three brothers -Ali Behrouze, Salman, and Shakir -- are now at the helm, but over time, the owners have also been able to instill professional and structured management across the businesses at different levels so that processes are self-sustaining.

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The Ispahani group has been the forerunner in numerous fields and has achieved noteworthy success in its many endeavours. Ispahani Tea is a household name and is the largest tea trading company in the country. It dominates the domestic tea market by capturing about 50 percent of the national branded tea market and 80 percent of the branded tea-bag segment. Particularly, the Mirzapore brand is a widely popular name distribution partners often identify the entire company as the "Mirzapore Tea" company. Pahartali Textile and Hosiery Mills (PTHM), established in 1954 with 18,000 spindles, is one of the pioneers in local textile manufacturing. The shipping division has been representing many world-renowned shipping lines and non-vessel operating common carriers in Bangladesh for the last 50 years. M.M. Ispahani Ltd. was again a pioneer in private sector power generation in 1951 at Pahartali. Turnover of the core group of companies amounted to more than Tk 200 crore in 2003; its export figures are also impressive. Tea and cotton yarns exported in 2003 were worth Tk 82.7 crore bringing the cumulative total amount exported in the last five years to about Tk 263.8 crore. On the prize giving ceremony of Daily Star DHL award, Mirza Ali Behrouze Ispahani, chairman of M M Ispahani Ltd, described the original vision behind the century-old company to be the one that is still driving it forward - the importance of investing in both the economic and social development of the country.

2. COMPANY VISIT: Enclosed are the pictures of the company head office and factory visit in the appendix section.

3. CRITERIAS FOR SELECTION AS ENTREPRENEUR OF THE YEAR 2003: (a) Innovation: M. M. Ispahani Ltd. is a company that has a vast product line of Tea, Cotton & Textiles Jute, Shipping, Real Estate, Foods, Poultry, Travel, Internet, Energy, and Textile. But even after having such a vast product line, Ispahani Ltd did not stop there but moved forward to new innovating products such as Ispahani Marshall Ltd which are already making a mark in contributing to the innovative product line. Ispahani Food will soon be launching a Biscuit to add more to their product line. Ispahani Limited has also been innovative in their production process. As for example, it was constantly been updating its machinery in Pahartali Textile and Hosiery Mills (PTHM) to keep up with the changing environment and be competitive. Currently an expansion of around TK 250 crore is going on in the Textile Mill to be more innovative in their products. It is this innovation that has helped Ispahani Ltd to export its goods abroad. The textile product is now exported abroad and also used in

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our local garments factories. Even the Mirzapore Ispahani Tea is serving the domestic market as well as being exported abroad with a very good penetration rate. Each of the tea gardens has factories equipped with modern tea manufacturing machinery. The tea produced is of high quality and sells at a at the Chittagong Tea Auction. There are 167 tea gardens in Bangladesh, and Ghazipur, Mirzapore, Zarreen and Neptune are consistently in the list of top ten tea gardens for the highest auction price achieved. Acknowledged as a pioneer in the marketing of tea, they introduced to the Bangladesh tea market: the laminated pouch; the double chamber tea bag; the "stand up" pouch; the food grade jar; the three layer pouch; the 10 gram easy pack and the "bag-in-bag" tea bag. Their tea department selects, buys, blends and packs the finest Bangladeshi teas for both the local and international markets. Best selling brands such as Mirzapore Best Leaf and Mirzapore Double Chamber Tea Bags are market leaders and household names in Bangladesh. And in case of Pahartali Textile and Hosiery Mills (PTHM), at present the installed spindle capacity of this mill is 56,352, and it produces 11,000 metric tons of yarn per annum. Due to increased demand for high quality knitting yarn used in exportoriented industries, they have intensified their BMRE (Balancing, Modernization, Rehabilitation and Expansion) program to meet the demand of knitting mills. Factory has been equipped with state-of-the-art machinery including the most technologically advanced European and Japanese equipment. They have also raised compliance levels to global standards by taking internationally recognized certificates of Global Organic Textile Standards (GOTS).

(b) Financial Performance/Productivity: M. M. Ispahani Ltd. Financial performance is at par with the MNC. It has a very good financial record in of salaries and wages paid. Ispahani Ltd has an astonishing record of giving its employees their salaries within 2nd or 3rd day of the month. As for the tax paying issue goes, it has been learned for company visit that Ispahani Ltd has been amongst one of the highest tax payers after the Multinational Companies. Ispahani Ltd is also know for not being defaulter for the loans taken rather in many occasions they have paid back their load before due time which has enabled them to make themselves financially sound. Turnover of the core group of companies amounted to more than Tk 200 crore in 2003, tea and cotton yarns exported in 2003 were worth Tk 82.7 crore bringing the cumulative total amount exported in the last five years to about Tk 263.8 crore is just some of the facts that Ispahani Ltd has not only been successful in doing business for so many years but has also been successful in making profit and continuously increasing their financial condition. The company has not only made profits but has efficiently used this money to reinvest in the existing sectors as well as entering new markets. The money has been also used to increase productivity of the existing sectors by adding new and improved machineries. To ensure productivity of the workers, Ispahani Ltd has given lots of facilities to the workers and to their family, such as medical facility and schools for the children of the workers at a very low cost but not compromising the quality of it. 5

(c) Company Management: M M Ispahani ltd has effective management style which is one of the reasons for their successful business. The employees of the organization are mainly divided into 3 main categories of Workers, Staffs and Officers. In case of Pahartali Textile and Hosiery Mills (PTHM) there are three types of workers who work in the factory. They are Learners (who are daily workers but works only when there is availability of work). Then there are Badli (who works on regular basis but not permanent workers) and last of all there are Permanent workers who work on regular basis and enjoy all sorts of facilities such as leave facility, hostel facility, etc. Staffs are the personnel who help the officers. And the officer raking starts form Junior Executives to General Manager. The organogram of the Pahartali Textile and Hosiery Mills (PTHM) and Tea Blending and Packaging Factory are given in the following pages:

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(d) Contribution to the community: Corporate and Social responsibility form a large part of the Ispahani philosophy. Throughout their history they have endeavored to and advance worthwhile causes. They have established schools and colleges in Bangladesh as well as the renowned Islamia Eye Hospital. In expanding the country's education, M M Ispahani's contribution is unique. It has established 9 renowned schools and colleges in Bangladesh where thousands of young people qualify every year. Islamia Eye Hospital and M.A. Ispahani Institute of Ophthalmology is a centre of excellence for providing modern, efficient and cost-effective eye care using the latest sight saving medical and surgical techniques. Since its inception in 1960, Islamia Eye Hospital and M.A. Ispahani Institute of Ophthalmology have been looking after the eye care needs of thousands of Bangladeshis. The hospital prides itself on the quality of its service, its cleanliness, its patient handling as well as services for out-patients. It also has a built-in medical/surgical follow-up regimen. The hospital and institute currently work in collaboration with different international organizations such as Sight Savers International, Orbis, Standard Chartered Bank and others for the prevention of blindness. It has a specialist line up of up to 40 doctors, 35 surgeons, trained nurses, paramedics and other staff to provide patients with the best eye care. The hospital handles 60 cataract surgeries every day. M M Ispahani has been involved for many years in the development of national games and sports in Bangladesh. Ispahani has been the patron of the Pioneer Football League in Chittagong for the last eighteen years, under the supervision of Chittagong Metropolitan Krira Sangstha. Every year, we sponsor the Premier Cricket League and Bijoy Dibash Cricket Tournament organized by CJKS. In 2007 Ispahani sponsored the National Cricket League for the seventh time. During the 2007 Cricket World Cup, Ispahani was the sponsor of the Bangladesh Cricket Team. In addition to football and cricket, Ispahani has also sponsored various golf tournaments for many years.

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4. RECOMMANDATION, COMMENTS & SUGGESTIONS: After studying and analyzing the different management aspects of M. M. Ispahani Limited, we can say that Ispahani Ltd has been a fully functional and has a good organizational structure. The company has been moving forward in all aspects like, innovation, financial performance, and management and also contributing a great amount to Corporate Social Responsibility (CSR). Even after getting the award in 2003, the progress of Ispahani Ltd has not stopped there. They have move forward in entering new markets and improving its existing sectors to be efficient as well as effective. So with keeping all this in mind, we believe that M. M. Ispahani Ltd still deserve to be labeled as the “Enterprise of the year.”

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