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CHANGE MANAGEMENT

AT

PAKISTAN STATE OIL

PRESENTED BYRAFIA PERVAIZ

FARYAL GILANI

AMARA ZAKRI

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CO MPANYS PR O FILE

PSO is the market leader in Pakistans energy sector.

The company has the largest network of retail outlets to serve theautomotive sector and is the major fuel supplier to:

Aviation

Railways

Power projects

Armed forces

Agriculture sector.

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CO NTINUED

y PSO also provides Jet Fuel to Refueling Facilities at 9 airports inPakistan and ship fuel at 3 ports.

PSO is currently engaged in:

Storage

Distribution

Marketing of various POL products.

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VISIO N STATEMENTVISIO N STATEMENT

To excel in delivering value to customers as an innovative and To excel in delivering value to customers as an innovative and dynamic energy company that gets to the future first. dynamic energy company that gets to the future first.

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MISSI O N STATEMENTMISSI O N STATEMENT

We are committed to leadership in energy market through competitiveWe are committed to leadership in energy market through competitiveadvantage in providing the highest quality petroleum products and servicesadvantage in providing the highest quality petroleum products and servicesto our customers, based on:to our customers, based on:

Professionally trained, high quality, motivated workforce, working as aProfessionally trained, high quality, motivated workforce, working as ateam in an environment, which recognizes and rewards performance,team in an environment, which recognizes and rewards performance,innovation and creativity, and provides for personal growth and innovation and creativity, and provides for personal growth and development.development.

Lowest cost operations and assured access to long Lowest cost operations and assured access to long- -term and cost term and cost effective supply sources.effective supply sources.

Sustained growth in earnings in real terms.Sustained growth in earnings in real terms.

Highly ethical, safe environment friendly and socially responsibleHighly ethical, safe environment friendly and socially responsiblebusiness practices.business practices.

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CHANGE MANGEMENT AT PSOCHANGE MANGEMENT AT PSO

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Position Prior To Cha ngePosition Prior To Cha nge

Rising Oil Prices in the international market.Rising Oil Prices in the international market.

Declining market share.Declining market share.

Dissatisfaction of employees.Dissatisfaction of employees.

Low productivity.Low productivity.

Lack of highly skilled and trained employees.Lack of highly skilled and trained employees.

Lack of updated knowledge and tools.Lack of updated knowledge and tools.

Non supportive work environment.Non supportive work environment.

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RESISTAN C E T O CH ANGERESISTAN C E T O CH ANGE

During the change phase there were many obstacles and it wasDuring the change phase there were many obstacles and it washard to convince the employees.hard to convince the employees.

The employees were convinced through:The employees were convinced through:

Communication about the purpose of changeCommunication about the purpose of changeTrust in initiativeTrust in initiativeTelling about benefits to them and organizationTelling about benefits to them and organizationBy getting involved in social welfare activitiesBy getting involved in social welfare activities

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TH E CH ANGE PR OC ESSTH E CH ANGE PR OC ESS

Problem/Opportunity recognition

Identifying the required Change

Implementing the Change

Evaluation

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CO NTINUEDCO NTINUED

The Human Resource Department, thoughThe Human Resource Department, thoughexperienced lacked modern professionalexperienced lacked modern professional

knowledge and tools.knowledge and tools.

Internally it had very ineffective environmentInternally it had very ineffective environmentfor all level of employees because of that thefor all level of employees because of that theproductivity level of employees was very low.productivity level of employees was very low.

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IDENTIFYING T H E REQUIREDIDENTIFYING T H E REQUIREDCH ANGECH ANGE

PSO had to come up with some major PSO had to come up with some major changes in values, culture, structure,changes in values, culture, structure,procedures and strategies.procedures and strategies.

The change was brought at organizationalThe change was brought at organizationallevel by Tariq Kirmani, who implementedlevel by Tariq Kirmani, who implementedthe policies designed by Late. Mr. Shaukatthe policies designed by Late. Mr. ShaukatMirza (Managing director).Mirza (Managing director).

According to Pakistan State Oil's Senior According to Pakistan State Oil's Senior

Officers the process of change took placeOfficers the process of change took placeby taking the services of highly qualifiedby taking the services of highly qualifiedand experienced professionals by designingand experienced professionals by designingnew business models.new business models.

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CO NTINUEDCO NTINUED

They had implemented the change process which included the four They had implemented the change process which included the four main changes that were Leadership, Social responsibility, Checkmain changes that were Leadership, Social responsibility, Checkand balance on employee's attendance and the Quality of itsand balance on employee's attendance and the Quality of itsproducts.products.

New business model was designed consisted of strategic analysis,New business model was designed consisted of strategic analysis,strategy development and strategy implementation.strategy development and strategy implementation.

This business model led to the development of a corporate strategyThis business model led to the development of a corporate strategy

and various other plans, which included strategic plan, annualand various other plans, which included strategic plan, annualcorporate business plan, the new styles of management andcorporate business plan, the new styles of management andimproving the products quality.improving the products quality.

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CH ANGE IMPLEMENTEDCH ANGE IMPLEMENTED

New Vision Program and integration of change strategyNew Vision Program and integration of change strategywith organizations objectives and employees goals.with organizations objectives and employees goals.

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O RGANIZATI O NAL RESTRU C TURINGO RGANIZATI O NAL RESTRU C TURING

The The Bottom up approachBottom up approach involvedinvolvedconsiderable discussion and consultationconsiderable discussion and consultationwith managers and employees, emphasized onwith managers and employees, emphasized on

participation.participation.

Enhanced communication and minimizedEnhanced communication and minimizeduncertainty and confusions.uncertainty and confusions.

Provided considerable opportunity for Provided considerable opportunity for management to identify and deal with areas of management to identify and deal with areas of resistance and other problems before theyresistance and other problems before theybecame serious.became serious.

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Pakistan State Oil implemented the change processPakistan State Oil implemented the change processincluding the four main changes as:including the four main changes as:

Leadership.Leadership.Social responsibility.Social responsibility.Check and balance on employee 's attendance.Check and balance on employee 's attendance.Quality of products.Quality of products.

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LEADERS H IPLEADERS H IP New leadership style was introducedNew leadership style was introduced

(transformational ,system and people(transformational ,system and peopleoriented) which helped in achievingoriented) which helped in achievingorganizations objectives.organizations objectives.

Consistency without exception, givingConsistency without exception, givingand getting respect, model best behavior,and getting respect, model best behavior,and doing and letting others follow.and doing and letting others follow.

Open communication with the staff.Open communication with the staff.

Top down approach which was later Top down approach which was later cascaded to have other employees oncascaded to have other employees onboard from other levels.board from other levels.

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S OC IAL RESP O SIBILITYS OC IAL RESP O SIBILITY

Before the change the company was not muchBefore the change the company was not muchinvolved in the social activitiesinvolved in the social activities

PSO has succeeded in creating a culture, builtPSO has succeeded in creating a culture, built

on their strengths and best practices, not only inon their strengths and best practices, not only interms of operating excellence and exemplaryterms of operating excellence and exemplarystandards but also in their proactive approach tostandards but also in their proactive approach toquality of life.quality of life.

It also created visual parks at different placesIt also created visual parks at different placeslike one is in Islamabad.like one is in Islamabad.

It also took certain steps to protect the animalsIt also took certain steps to protect the animalsas well.as well.

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CH EC K & BALAN C E O N EMPL O YEESCH EC K & BALAN C E O N EMPL O YEESATTENDAN C EATTENDAN C E

Before the change the employees never stayed full time at their Before the change the employees never stayed full time at their work place.work place.

Employees were free to leave their work and could easily leaveEmployees were free to leave their work and could easily leavetheir offices without any strict control.their offices without any strict control.

Change was brought to context a new rule of keeping an eye onChange was brought to context a new rule of keeping an eye onemployees.employees.

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QUALITY O F PR O DUC TSQUALITY O F PR O DUC TS

The image of Pakistan State Oil wasThe image of Pakistan State Oil wasnot so good in customers mind, itsnot so good in customers mind, itsquality was low as compared to itsquality was low as compared to itscompetitors .competitors .

Quality management system wasQuality management system wasintroduced for its operational activities.introduced for its operational activities.

Satisfying the customers' needs whileSatisfying the customers' needs whileensuring the highest quality of ensuring the highest quality of products and services, consistentproducts and services, consistentconformance to prescribed standardsconformance to prescribed standardsand specifications.and specifications.

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EVALUATI O NEVALUATI O N

After the strategic change process: After the strategic change process:

Today Pakistan State Oil is recognized as a model of Today Pakistan State Oil is recognized as a model of corporate turnaround in the world.corporate turnaround in the world.

The company had won global recognition of corporateThe company had won global recognition of corporateexcellence.excellence.

The company increased its market share.The company increased its market share.

The company maintained its strong focus on New VisionThe company maintained its strong focus on New Visionretail Development program.retail Development program.

The company laid special emphasis on quality andThe company laid special emphasis on quality andquantity of productquantity of product

Employees are enthusiastic and satisfied.Employees are enthusiastic and satisfied.

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RE CO MMENDATI O NSRE CO MMENDATI O NS

Knowledge sharing environment andKnowledge sharing environment andcontinuously learning and instantly practicingcontinuously learning and instantly practicingit.it.

Benchmark against standards andBenchmark against standards andcompetitors.competitors.

Documentation and recording of changeDocumentation and recording of changeprocess that occur.process that occur.

Consistency and TQM.Consistency and TQM.

HR department at each center.HR department at each center.

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C hange Must Involve the PeopleC hange Must Involve the People - - C hange Must Not C hange Must Not be Imposed Upon the People.be Imposed Upon the People.

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