Case_Study-A Day in the Life

8/15/2019 Case_Study-A Day in the Life

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By Professor Baber Saad Khairi SPRING 2016

A DAY IN THE LIFE OF CORPORATE PAKISTAN

1This case prepared for discussion in Seminar for Business Policy. Baber Khairi may be found at: [email protected]

Maliha

Graduating with an MBA from Karachi’s leading

private business University, IOBM, Syeda Maliha

Hasan (or Malo for short) joined MAFOM

Pharma as a Manager for product development.

After 6years studies, with a high GPA and

excellent references from her professors, she

was ready to take on the world.

After completing her BBA she had worked for

two years at KAHO TV as a Pharma Marketing

Expert, gaining valuable experience before

returning to do complete her MBA. She had

hoped to join a multinational like P&G but noone was hiring when she got her MBA. She had

loved her internship with Glaxo SmithKline and

enjoyed the thought of being in the

Pharmaceutical sector.

Eventually a chance meeting with Mehmood

Qureshi, the MD of MAFOM Pharma, at a fund

raiser changed her chances of getting a suitable

job. MAFOM Pharma originated as a trading

company from Mardan that went from trading

activities – exporting cotton – to packingmedicines. In time it shifted its head office to

Karachi where it got into a joint venture with a

medium sized French company, Medicines Avec

Frontiers – MAF for short.

Malo had done well at KAHO TV – she was hard

working, ambitious and always ready to take

the initiative. As a star performer she caught

the eye of many people. One such person was

her owner- boss who was going through a

midlife crisis. She had attracted unwanted

attention from him and as he sought to cometerms with his life at that stage, he had made a

pass at Malo who was unsure whether to fight

him or not. In the process he suggested she

become his mistress in exchange for rapid

career growth. He had given her the key to his

hotel room where he would be spending the

weekend.

“And if I refuse?” she asked

“If you say yes, we will have a lot of fun

together and your career will shoot into space.

You will go places in this company and we will

enjoy ourselves a lot” he paused and thenadded very directly “Other wise your career here

at KAHO is over ”

“But I’m engaged! And you’re married with kids.

How will your wife feel?”

“Hmm, my wife knows that boys will be boys. I

provide her a home, money to burn and good

living. That is what she wants” he said it as a

matter-of-fact and smiled back.

She was shocked and furious. She contacted

other senior people in the company but theyseemed to think it was an acceptable price for

rapid career growth. One even told her that not

everyone got such an opportunity. She went to

the HR department but they flatly suggested

she get another job. Malo then complained to

her fiancée Noman, expecting him to fix it.

Noman however, had other ideas. When they

got married, the extra money would come in

handy and they could afford so much more – he

could get a nose job. “But he’s harassing me!”

‘So? ’ came Noman’s reply ‘It is your problem:

you deal with it. Give him what he wants or

leave the job. It is simple. I am such a great help

to you’

Then she had a big break --- a job offer with

Nestle Foods. One of her IOBM professors

strongly recommended her. They offered her

everything she had dreamed of and more but

her fiancée, Noman, wouldn’t let her take it.

Noman had wanted to join Nestle but couldn’t

even get an interview. He was deeply jealous

and made sure that Malo didn’t work thereeither. With a ‘C’ grade from Shah College, he

was working at a Call center for NEL. So she

returned to IOBM again on a scholarship to get

her MBA. Noman was annoyed that she didn’t

have any money to lend him during her studies

and frequently told her what a drag she was on


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his finances although he never paid for anything

she did.

After Malo completed her MBA and was about

to join MAFOM Pharma, Noman was happy

again because now he would get her to takehim to movies, buy him expensive items and

pay for his Hairdressing parlor bills where he

spent hours grooming himself, especially his

moustache that was his pride and joy.

The MAFOM Management

The Zarmina Group – in which MAFOM Pharma

was its flagship company and most profitable

unit -- was the brainchild of Captain (Retd)

Sultan Sherwani, husband to a wealthieryounger wife, Zarmina Khan, the daughter of

Nawab Zahid Khan, a one-time Provincial

Minister and progressive landowner. He had

two brothers in the group, along with several

relatives. Their eldest son, Sultan’s stepson, had

studied in the US where he had met and

married a minor Emirati Princess with family

interests in the Far East. Their daughter, Mina,

an artist, was busy enjoying life in the south of

France while the youngest son Khalid, liked to

spend time in the Far East, especially Singapore

where he had settled. MAFOM Pharma was a

joint venture between MAF - Medicines Avec

Frontiers - a medium sized French company and

Sultan Sherwani’s medical distribution company

Oriental Medicines (OM). Sultan Sherwani was

Group Head and Chairman.

MAFOM Pharma’s Managing Director (MD)

Mahmood Qureshi, was an MBA from the

Wharton school of Business; and had worked in

France for many years. He had joined MAFOM

at Sultan Sherwani’s request as the two got onwell together - often playing bridge at the Sindh

Club. Mahmood Qureshi had made a huge

success of MAFOM and was always looking for

talented managers. Unfortunately a few months

after hiring Maliha, Mahmood’s wife had a

relapse. Her cancer had got worse and she

shifted to France for treatment. Mahmood

Qureshi took extended leave and a successor

was appointed.

Humayun

The man who took Mahmood Qureshi’s placewas Humayun Shareef, General Manager (GM)

Finance at Zarmina Tiles. Humayun was a

Chartered Accountant (CA) from the UK and he

related to the famous singer Waheed Sharif.

Humayun was a soft spoken, quiet man who

had successfully reduced costs by 20% and laid

off 200 workers. However in their detailed

evaluation of the 52 year old Humayun, both

Mahmood Qureshi and Francois Martel did not

consider Humayun Shareef executive material,

had doubts about his integrity as a leader andpreferred him to be kept in a support role.

But a dozen years earlier Humayun, then aged

40, had married Faryal who was niece to

Zarmina Khan’s cousin’s sister-in-law, which

assured his career at the Zarmina Group. Just

as Mahmood Qureshi was about to leave

behind Francois Martel as his successor at

MAFOM, a scandal in Zarmina Khan’s family

drew everyone’s attention away from MAFOM.

Added to this Francois began to get death

threats from mysterious extremists so that he

left the country in a hurry. Meanwhile

Humayun’s wife Faryal resolved the family

scandal as a mediator. In recognition of her

services, Humayun was appointed the new

Managing Director of MAFOM with Zarmina

Khan’s backing in the absence of Sultan

Sherwani, who was away in France at the time.

Humayun’s first decision as Managing Director

(MD) was to close down the Human Resources

(HR) Department. Quarterly reviews becameyearly; bonuses would be based on overall

company, not individual, performance. His own

salary would be increased by 20% every year

regardless of how the company did. This made

hiring much easier as no candidates were

needed to be vetted with difficult job

descriptions to be followed. He assured


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everyone that he was doing this for the

company’s own good, so that hiring could be

immediate and fast tracked. The result was a

hiring policy that ensured that most Director

and GM posts eventually went to Humayun’s

friends – also Accountants. He felt that MBA’swere arrogant while Accountants like himself

were reliable. The HR Department was

considered a key asset of MAFOM by its parent

company in France – MAF – but Humayun felt

that HR people would not allow him to hire his

friends, their sons and other well connected

people who could bring lots of business in, so

he got rid of it.

Another area which Humayun did not like was

Ethics and Compliance Committee. Its job wasto oversee all senior management moves and to

ensure fair play, honesty and justice in all

management decision. It reported to the

Chairman and was not accountable to the MD.

Humayun made a number of excuses such as

high costs, its unnecessary disturbing of the

busy chairman and tried to embarrass or cajole

its members. He paid them late, withdrew their

allowances and made their lives miserable so

that one by one they got themselves assigned

to other areas in the company and he was able

to close down the committee’s functioning. Hedid all this in the absence of the chairman who

was still away on business.

Humayun would have preferred if Maliha left,

so her job could be taken by one of his friends

but because she had been hired by Mahmood

Qureshi, he thought it best to keep her until

such time as he could replace her with someone

less honest.

Exhibit 1

Background Information on the

Owners of The Zarmina Group

Sultan Mohammad Khan Sherwani was born on2nd June 1936 in Aligarh, British India, where hisfather, Dost Mohammad Khan Sherwani, a Pakhtunfrom Mardan, was sent to study at AligarhUniversity for a degree in law. Originally fromAfghanistan, the Shinwari tribe members thatsettled in the subcontinent were called TheSherwanis. After his father’s graduation, Sultangrew up in Aligarh and at the time of partitionwhen his family moved back to Mardan inPakistan, he was sent to study in the UK. Afterfinishing boarding school, he did chemicalengineering and then worked in the UK andFrance for a few years. He was 27 when hearrived at his ancestral home in Mardan for thefirst time. Sultan did not like Mardan at all andfound his family members there too limited,feudal, selfish, greedy and mean. His Pashto wasalso as poor, as he was eloquent in Urdu, Farsiand English. He joined the Pakistan Army in1964 and after his training was posted to Gilgit.However after some years there, his wife andbaby daughter were killed in a landslide in thenorthern areas and he left the army shortlyafterwards, heartbroken. He then set up hisbusiness in dry fruits, transport and mangoesand finally setting up factories in agro basedmedicine. His business eventually grew largeand prosperous and he did not remarry foranother decade until he met the woman of hisdreams. He then settled down with her inKarachi where he set up MAFOM Pharma underher name, Zarmina.

Zarmina Khan [Sherwani] was born at WahCantt in 1950 to a family of large land owners.She studied at the Murree Convent andcompleted her Cambridge (O’Levels). At the ageof 16 she accompanied her grandfather to Pariswho was posted there as Commercial Attaché atthe Pakistan Embassy. While in Paris she wasthen married to Kambakht Khan, who wasstudying Law at the Sorbonne. The marriagelasted less than a year because Kambakht wouldnot stop chasing the pretty Parisian women. Her


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received a flood of congratulatory messages

and compliments with comments like:

“It couldn’t happen to a better person” and

from juniors: “You are my ideal: calm,

aggressive and polite” and “I wish I could be likeyou”. Feeling good she had taken sweets to her

fiancée. They were to marry in 3months. But

Noman, as usual, was derisive:

“You’ll be sacked once they find out what you

are really like! You were just lucky this time but

your luck won’t last. And don’t think I don’t

know how you got your promotion”

She was confused by this: “How did I get it?”

she asked

“Same way you always do!” he shot back “Youhad an affair with your boss, maybe even with

two bosses!”

“What!!!!?” She screamed at him

“Don’t what me!” said Noman “we both know

you are no good. You are a useless woman,

incapable of doing anything right. You got the

promotion and didn’t call me immediately. First

you went to thank your bosses. That tells me

something about you. You are like that!”

Malo was shocked: how could he say such

things about her? This was the man who hadborrowed Rs100,000 from her last week,

thousands of rupees in the past 6years, who

was unemployed most of the time and never

had a kind word for her. And then he used her

car for the past two months to take out a client

from BIG TEXTILE MILLS and he was talking like

this? How jealous could this man be?

“How dare you say that! How dare you?” she

cried

Noman broke their engagement. He had spentso much of the money she had earned on

himself and was never nice. Now he announced

that he was going to be marrying Mr. BIG’s

daughter of BIG TEXTILE MILLS in Faisalabad.

Mr. BIG had bought him a Honda Accord as a

wedding present. It was goodbye. Malo was

devastated.

Reporting Lines

While on her training orientation at IT, Maliha

reported to Ilyas Patani - a Humayun Shareef

appointee – who was serving as the GeneralManager (GM) for Information Technology (IT).

Ilyas had spent a lot of time in the USA and

made much of the fact. Although his resume

sounded impressive, Ilyas came across as a bit

insane. But Humayun explained this as a sign of

genius.

In the first departmental meeting that Maliha

attended, Ilyas Patani announced that he’d

been Director of IT at Citibank posted in Florida;

he commuted to New York many hours away bythe corporate jet with the Citibank chairman.

Malo remembered that John Reed had been a

Chairman at Citibank from an old case study

she’d done in her Strategic Management

course. To make herself an agreeable team

player she jumped up excitedly to say: “You

must be knowing John!”

‘Who?’ came the reply

“John Reed. You know John. He was the

chairman of Citibank then – in New York?”

Ilyas glared her angrily and shouted “You MBAs!

You MBAs! You think you know everything!” andmarched off angrily.

A few days later as Maliha was testing the

system for her department, Ilyas came in and

announced: ‘There’s Miss know it all! The MBA’

Ilyas wanted to know where she had learned

about John Reed from?

Maliha bluffed: “From Sally”

‘Who is Sally?’ asked a troubled Ilyas

“Well Sally Reed of course. But you already

know the family. Such a nice family aren’t they -sir!”

Ilyas let out a loud squeal, shouting “You MBAs!

You MBAs! You MBAs! You MBAs!’ and again

marched off. A few days later he had forgotten

all about his bank days and was telling his

admirers about his time at Apple Computers

which he had turned around single handedly;


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down and suggested they sign it together. He

looked around for his pen. “Where’s my pen?

Najmi! Where is my pen?” Najmi looked at him

blankly “What?” “My pen damnit? You had my

pen – give it to me!” Najmi said: “You took it

with you” Shakir was upset – he couldn’tremember when he took his pen or where he

had put it.

Najmi got up and borrowed one from Ismail. He

came over and signed and told Shakir to sign.

Shakir took the pen and said: “You idiot!” said

Shakir, unable to control his anger “you’ve

signed under my name. We’ll have to take out

another printout. Let me give the command

again” as he bent over the workstation. He was

about to get the printout when Najmi asked forthe pen back and getting it, walked away with

something noticeably pen like in his pocket.

Shakir saw it and felt still angrier. Shakir caught

up and demanded his pen again and the

argument became heated. Soon they were

physically fighting.

Omar rushed in and shouted: “Fight! Fight!” and

called others to have a look “the odds are 4 to

3. 4 TO 3 – place your bets! More people think

that Najmi will win: place your bets! Place your

bets!” Malo came running in and tried to getbetween them to stop it but by mistake

someone hit her and she fell down. They

stopped and lifted her onto a chair. Shakir and

Najmi were still cursing each other when Shakir

discovered his pen in his trouser pocket.

Embarrassment and apologies followed and

they laughed it off over some hot tea and

samozas.

Problems

Maliha was not the only one to have beenpromoted. Shakir had also been promoted to

Assistant Manager which was the same level as

Omar and above Anees. Maliha tried to

convince Humayun Shareef at least to give

Omar more money in recognition of his

services. Many Doctors had complained about

Shakir’s arrogant attitude while praising Omar’s

mature, friendly manner. Humayun Shareef felt

he had done enough for Omar and refused.

Omar became very angry and blamed Maliha

for favouring Shakir.

Next Javed was found to be sellingcomplimentary drugs (i.e.: free samples) and

pocketing the proceeds. His salary was

deducted as a fine. He blamed Maliha although

it was Humayun Shareef who ordered the

deduction without informing Maliha. Unable to

afford lavish living in Karachi anymore, Javed

left MAFOM Pharma, informing his powerful

uncle in Islamabad who called up angrily to

complain about Maliha. He was unhappy that

Javed had not been promoted when Shakir

Khan had been. To please him, Humayun cutRs20,000 per month of increments from

Maliha’s pay for 6months. She was speechless.

A week later the General Managers’ Committee

called Maliha in. They were cold and distant and

accused her of fostering an environment of

distrust that caused her colleagues to act

abnormally. No matter what she said, they did

not listen and suspended her new benefits. She

would be on probation for another 6months. In

addition Humayun’s pay cut of Rs20,000 per

month would be applied to her old salary. Shewas considered a bad manager while Humayun

Shareef saw he might soon be rid of her and

contacted his friends for a possible, upcoming

job opportunity once Maliha left. At the same

time, to safeguard his interests, he informed

the Chairman that Maliha was “not working out

for the company” and might have to leave soon.

Malo came back to the department with her

bruised face feeling low. Shakir was again

looking for his pen. Najmi was last seen using itand Shakir was trying to find him. Omar came

up and encouraged him to have a real fight so

Omar could arrange a proper betting session.

Shakir now turned on Omar: “You Arains are

messing up everything here. You want everyone

to fight so you can get the top post. But I know

you and I will be the top person here not you!”


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Omar didn’t like the tone of Shakir’s voice and

hit back: “You corrupt Sherwanis! Who do you

think you are? This is a French Joint venture! I

know French and they will come here and make

me manager! I will lead this department!” Soon

they were fighting as well. Malo didn’t knowwhat to do. Just yesterday she had intervened,

got punched and today suspended. After quite a

few things had been broken and files and paper

flying she started shouting but no one heard.

Finally she screamed. There was a sudden

silence. “Please don’t fight: please, please” said

Malo and began to cry. Everything she had

worked for was gone. She had lost control and

this might be her last day on the job. People

started looking busy and working again. They

gave her some tea.

Everything she had worked for was gone. She

had lost control and this might be her last day

on the job.

Once calm had been restored, she tried to

speak to each one individually, but they

patronized her for being “only a woman”. Shakir

declared he would get Omar removed and

having made the threat followed it up by

demanding a posting with a bigger car in

Islamabad as Regional Manager. If she didn’t hewould get his uncle who was related to the

Chairman to intervene. Maliha tried to reason

with him but he wasn’t interested in hearing

her. He demanded that Maliha immediately

issue orders for the posting. But Maliha knew

that only Humayun Shareef had the authority to

do that. Annoyed at her non-cooperation he

stormed off. Her talk with Omar fared no

better. He felt that she was taking Shakir’s side.

Shakir had been promoted hadn’t he? Omar

complained to Humayun Shareef ’s managersabout Maliha’s high handedness. He refused to

listen to “a silly girl”.

Resolution

The next day was a holiday but Maliha came

into work as she was going on tour from the

next week. Humayun Shareef saw her and

enquired about the “incident” between Shakir

and Omar. Maliha didn’t want to talk about it.

Being punched by mistake, demoted, having her

pay cut was enough de-motivation. And then to

go home to a family who blamed her breaking

up with the wonderful Noman was getting toomuch. She was beginning to lose focus and snap

at people and couldn’t remember the last time

she was happy. Humayun told her not to worry

as he would have a word with them sometime

next week.

Islamabad

The cool winter weather of Islamabad made her

feel very good about the world. But a week into

her trip she got an SMS from Humayun Shareef

ordering her to drop everything and rush backto Karachi by the earliest flight. She made the

booking but realized it was a call to crisis again

and she suddenly felt very old and tired beyond

her years.

Karachi

It was a public holiday so the office was closed

as she entered. She had come directly from the

airport from where her parents picked her up.

Seeing her frail form, they had hugged her and

said nothing. For the first time in so long she

felt like they understood by their silence. Theytook her to work and parked outside and said

they would wait there until she was done.

She went inside to Humayun Shareef ’s office

and sat down. He told her he’d spoken to Omar

and Shakir and showed her a paper with a long

list of accusations. She read the paper until her

eyes rested on…:

“We Omar and Shakir have no idea what that

conniving Maliha is talking about. She is alwayslying and insulting us with her behavior.”

Maliha looked up and protested: “I have

always treated them with respect. I don’t

understand why they would say such

things...” “READ ON” commanded Humayun


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“We are ashamed to be in the same room as her

because she has shown us a list of Zarmina

Khan’s lovers…”

“WHAT?!” said Maliha “WHAT?” She went on

reading…

“How can we not be ashamed to be in the same

room as this vile person! I requested a posting

only to get as far away from this vile witch!

Omar complained to the other General

Managers because we were so shamed by this!

What has my family done to deserve this

treatment? Please tell us how we can face her

again after this dishonor! Help us please Sir

Humayun please help us!”

“This is ridiculous! Zarmina Khan’s only lover

would be her husband Sultan Sherwani”

‘Stop acting Maliha! We both know Zarmina

Khan was married before she got to Sherwani

sahib. And we all know what kind of family they

are. Look at the scandal they had when Qureshi

sahib was leaving. My wife had to work so hard

to save the situation!”

“I didn’t know she was married or that therewas a scandal ---“

‘Don’t act so dumb! Ilyas Patani says you know

about everyone, even about top Americans”

“Top -- ? I read Businessweek and the

Economist and Dawn. I was a business school

student!”

‘ MALIHA KHAN!!’ barked Humayun loudly

“Its Maliha Hasan. Syeda, Maliha Hasan” she

interrupted him calmly

‘Maliha! Y our career here is finished. You have

created a huge mess in your department and

everyone is angry. You lied about Shakir and

Omar . I don’t know what you said to Javed but

the Federal Secretary, called up especially to

complain about you! You can’t do business in

this country if you annoy a Federal Secretary.

It’s simple as that. You have to go because the

company cannot take this kind of nonsense!

Hand in your resignation today and I’ll give you

a recommendation and three months extra pay

which is very generous. I am sorry it had to end

this way. But its over.

Goodbye’

Maliha was stunned, but Humayun Shareef

wasn’t listening. Maliha got up from her chair

and walked out with tears rolling down her

cheeks. Her career in Pharmaceuticals was over.

----------------------


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Epilogue:

Maliha eventually became Chairperson andGroup Head for the Al Khalid Group inSingapore, where she settled down aftermarrying a wonderful man. They have twodelightful kids.

Faryal Shareef - Humayun’s wife - was foundout to have engineered the scandal in ZarminaKhan’s family so that Humayun was transferredto Somalia, where he eventually became apirate. Javed joined the PTI and migrated toSouth Africa where he set up a sweet shopnamed PTISA.

After Humayun’s transfer to Somalia,Omar quickly left the company and joined CitySchool but now has only women bosses; Shakirtoo, sensing trouble, migrated to Mongolia.

Najmi is now a highly paid male model for Veetbut everyone still hides their pens when he isaround. Noman was kicked out by Mr. BIG andhas joined the circus. He can be seen in theMonkey act

---------

DISCLAIMER: All names and industries havebeen changed. All characters whether alive or

dead are purely fictional and any resemblance

to any living person is purely coincidental.


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MAFOM PHARMA

Exhibit 2 Organizational notes on MAFOM Pharma Ltd

Chairman --- Board of Directors (Directors from MAF, ZG, OM, NBP, IFC, SABIC)

|

Managing Director (MD) (CEO)

|

Deputy Managing Director (DMD) (CCO)

|

Marketing & Product Development Division

Executive Cadre

Director (C M O) 803,000pm plus 710,000pm benefits Accord + Civic General Manager (EO) 465,000pm plus 500,000pm benefits 2 Civic / 2 Corolla

Manager CadreSenior Manager (Maliha after promotion) 167,0000pm Plus 275,000 pm benefits City /New Swift

Manager – (Previous Maliha) 55,000 pm 140,000pm benefits Cultus Car/Passo/ Vitz

Senior Asst Manager (OMAR) 43,000pm 70,000pm benefits Alto / Mira

Asst Manager (SHAKIR/ NAJMI) 37,200pm 60,000pm benefits Cuore Auto

Officer Cadre

Senior Officer 31,000pm 45,000pm Car loan / Mehran

Officer (ANEES) 24,800pm 30,000pm Motorbike/Van

Asst Officer (JAVAID) 20,250pm 20,000 pm Company Van

Trainee 17,050pm Company Van

Bonus and incentive rewards are earned. Extra performance is compensated by cash awards, foreign vacations,

local vacations, access to beach huts – Hill cottages – City Rest houses, foreign training programs, better facilities,

Marketing

Division

Finance DivisionPharma

Production

Division

IT, R&D

Strategy

DivisionAdministration

Division


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club allowances, time off, school/college fees, local or foreign medical treatment, stylish mobiles, entertainment

facilities, up-graded travel allowances, share options for stock in Pakistan and or France, US, EU (E cadre) and so on

Abbreviations: CEO – Chief Executive Officer (MD) C_O – C-SUITE OFFICERS

EO – Executive Officer

All Directors are in the C Suite and have ‘C’ (Chief [?] Officer) titles, e.g.: Director Marketing is CMO;

Director IT is CIO; Director Corporate is CCO (= Chief Marketing Officer; Chief Information Officer; Chief

Op Off; Chief HR Officer; Chief Technical Officer; Chief Strategy Officer and so on)

HIERARCHY titles:

Rank Age Avg age Exp. Qualification Tenure Avg increments

General Manager 50 53 MA/MCOM/MBA 12 17

Senior Manager 40 46 MA/MCOM/MBA 8 12

Manager 35 43 MA/MCOM/MBA 10 12

Assistant Manager 30 33 MA/MCOM/MBA 7 10

Officer 25 29 MA/MCOM/ BBA 7 8

Trainee 21 25 BA/BCOM 3 2

The HR (Administration Division)

Career Planning & Development

Exhibit 3

There are 2 career paths at MAFOM. One is the normal progression path where ‘rankers’ are allowed to rise in

time and according their ability. The second is the ‘fast track’ to which talent is recruited and tested through initial

Management Trainee Program (MTP) at the initial level and the Key Employee Program, where employees are

identified as important, essential and key to the success of the company leading to early promotions, tougher and

increasing employment challenges and higher compensation packages. MTP are hired at the Assistant Manager

level without benefits confirmation as Assistant Managers. This exhibit demonstrates the normal progression path .

Manager Cadre

Rank Minimum Age Av age Degree for starting Tenure Avg increments

Senior Manager 30 38 MA/MBA/MS 7 6

Manager 25 43 MA/MBA/MS 7 6

Senior Asst Manager 25 32 MA/MBA/MS 7 6

Asst Manager 23 26 MA/MBA/MS 5 9

Officer Cadre

Rank Minimum Age Av age Exp. Qualification Tenure Avg increments

Senior Officer 30 34 MA/MCOM/MBA 11 14

Officer 26 29 MA/MCOM 7 9

Asst Officer 21 24 BA/MA/BCOM 6 5

Trainee Officer 19 22 BA/BCOM 2 1

Retirement age is 62years which is mandatory for all except Key employees


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Employment Conditions

Exhibit 4

Probation: All employees, except Trainees, are on a 3month probation period from the start of theiremployment. On successful completion of the 3month probation, employees’ services are confirmed

wherein they are invited to join the provident fund (PF), avail of leave, medical benefits, receive

insurance cover and so on. Their salary is usually increased by 5% or 10% as an indication of successful

completion of the probation period. Employees may sometimes have their probation extended to

6months, 9months or 1 year. Such an employee may require more grooming, training, guidance or

counseling to reach the required parameters of the job for which they were hired.

1 bonus equals a month’s salary. Maximum bonuses are paid as follows:

E cadre 2 bonus per quarter - 1 bonus paid in FCY

M cadre 1.5 bonus per quarterO cadre 1 bonus per quarter

A quarter is 3months

Bonuses: All employees must receive 1 bonus per year in order to remain employed. Any employee

ending the year with no bonus received, will be asked to resign as follows: any employee who has not

been paid a bonus in the quarter is put on probation for a minimum of 3months, given any training as

needed, as well as counseling, guidance and helped to return to a normal operational output.

Every year salaries are increased by 5% to 7.5% as COLA (Cost of living Allowance) award.

1 increment, given annually, is equal to approximately 7.5% (range 7% to 7.875%)

The salary is divided up as follows:

Basic salary Example 10,000

Rent Allowance as 55% of basic 05,500

Allowances paid as 20% of 02,000

_____________ ______

Total pre-tax salary 17,500


14/14




Confirmed Employee Allowances

Exhibit 5

Provident Fund is deducted as 10% of Basic salary directly from salary and deposited as Employee’s

contribution. Employer’s matching contribution is made as 12.5% of basic salary. An employee maywithdraw his/her own and his/her employer’s contribution plus profit earned on the gross amount after

5 years.

Gratuity is paid after 5years as 1 total salary per year of service at the latest total salary. So if according

to the above example the employee’s salary after 5 years has advanced to a basic of Rs15,400 and a

total salary of Rs26,950pm, that employee will be paid Rs134,750 as the gratuity earned - in addition to

the provident fund contribution as earned - and any other termination dues.

OPD (Outpatient) is an allowance for medicines, doctor check up and any spending on the employee’s

medical condition. It is budgeted as one total monthly salary per year at the Officer cadre; two total

monthly salary per year at the Manager cadre; three total monthly salary per year at the Executive cadreunless already covered by medical insurance policy or if the employee wishes to seek medical attention

outside Pakistan at a mutually approved facility. All employees are covered by medical insurance.

Termination dues are any amounts such as earned leave, medical allowances as pro-rated, bonus and

options due/earned but not yet paid and any other amounts owing to the employee at the time

departure from the company.

Employee Leave Policy All employees are entitled to 25 days privileged leave earned per year which are

allowed to accumulate for a maximum of 3 years. In addition all employees may avail themselves of 10

days of medical leave and another 10 days of casual leave which expire at the end of the company’s

financial year. Additional privileged leaves may be earned in lieu of bonuses, share options, or other

incentive programs. All privilege leave granted is only for working days. For example a 31day month

might have 9 days as weekends, therefore an employee availing privilege leave during the whole of that

month will only be counted as having taken 22days of privileged leave, allowing the employee 3 days of

privileged leave balance outstanding. Similarly if there are any public holidays that fall during that period

these will be deducted from the total of the leaves taken unless these already fall on a weekend.

Study Questions:

1. Does MAFOM have a competitive compensation structure?

2. Why is senior Management paid so much more than the lower cadre employees?

3. Is the executive cadre paid too much?

4. What is the organizational structure of MAFOM?5. What kind of organizational structure would be better for MAFOM? Explain.

6. Is this a good organizational culture? If not, what issues need to be addressed in this culture?

7. Is Humayun Shareef a good Managing Director (MD)? Why and why not?

8. Why is there so many politics in this organization?

9. Why is there so much emphasis on Talent and Key employees at MAFOM?

10. Should Maliha accept her termination? What should Maliha do when faced with termination?

11. What other information do you need to better understand and use this case study?

Documents

Case_Study-A Day in the Life