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TERM REPORT

TOPIC

EMPLOYEE MOTIVATION

GROUP MEMBERS

SEHRISH MANSOOR

SHAMSUNISA MIRZA

NOMAN NOORULLAH

SARA MOHIUDDIN

MARIAM TAMEEZUDDIN

DATED

DECEMBER 06, 2010

PAKISTAN STATE OIL

ACKNOWLEDGEMENTS

Our group would like to acknowledge Mr. Rizwan, Head of Training Department for his extensive support and cooperation for making this report. He further sent us to Mr. Zulfiqar Ali Jafferi, General Manger Consumer Behavior, who facilitated us and provided us with sufficient information and insights about the motivation practices that take place currently at PSO. Our

visits to PSO have been very knowledgeable and fruitful. We would also like to thank Ms. Shagufta Rafif for giving us, students a chance to visit the organization and getting to know

about the organizational setup. As students of Organizational Behavior this report has broaden our understanding of the subject and has allowed us to experience the theory in practical

applications

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LETTER OF ACKNOWLEDGEMENT

Dear Reader,

It has been an honor for us to prepare a report on “Pakistan State Oil” which was assigned to us by Ms. Shagufta Rafif without her rich guidance such a report would not have been any easy task to achieve.

We would like to thank Mr. Zulfiqar Ali Jafferi, General Manger Consumer Behavior of PSO for providing us valuable information that helped us to complete this report.

We would again like to take this opportunity and express our acknowledgement distinctly to Ms. Shagufta Rafif for directing us about the technical aspects of the report and we express sincere gratitude to our parents for their continuous support throughout the preparation of this report.

Regards,

SEHRISH MANSOOR

SHAMSUNISA MIRZA KHAN

NOMAN NOORULLAH

MARIAM

SARA

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LETTER OF TRANSMITTAL

DECEMBER 10th, 2010

Ms. Shagufta RafifCourse InstructorOrganizational BehaviorInstitute of Business ManagementKorangi Creek,Karachi.

Dear Ms. Shagufta,

Here is the report you requested in the start of this course about the impact of motivational practices in the organizations, along complete analysis, conclusion and recommendations. The study included both primary and secondary research. The study mostly includes the secondary research which consists of interviews with the CONSUMER BAEHAVIOR EXECUITIVE.

Although the current motivational practices conducted by PSO are going well, the information gathered from different sources shows that with some more motivational practices the company can get the desired results more effectively and efficiently.

We are grateful to the CONSUMER BAEHAVIOR EXECUITIVE of PSO for his generous cooperation with us in answering our questions because of which we were able to complete our report. It has been a privilege to work on this report for which we are grateful to you. Should you have any query concerning this report, we will be happy to discuss them with you.

Yours Sincerely,

SEHRISH MANSOOR

SHAMSUNIASA MIRZA KHAN

NOMAN NOORULLAH

MARIAM

SARA

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CONTENTS

Table of contents

1. Executive summary…………………………………………………………………………………(6)2. Methodology…………….. ………………………………………………………………………....(7)3. Mission and the Vision of the organ…………………………………………………………..(8)4. Introduction and History of PSO………………………………………………..…………..(9-10)5. SWOT Analysis……………………………………………………………………………………...(11-12)6. Motivational Practices Used in PSO ………………………………………………………(13-18)7. Employee Recognition Program Used in PSO ……………………………………….(19-23)8. Flexible benefit programs adopted by PSO……………………………………………(24-29)

a) Allowing employees it build their futureb) Designing flexible benefitsc) Employee health and well beingd) Total reward

9. Conclusion………………………………………………………………………………………..…..(30)

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EXECUTIVE SUMMARY

The purposes of this report are (1) to analyze different motivational practices used in Pakistan State Oil (PSO), (2) to study the following programs run by PSO which includes; employee recognition, job rotation and flexible benefits, and (3) to give conclusion.

An interview was conducted by our group members with Consumer Behavior executives section of PSO to gather up the relevant information. The Consumer Behavior department is responsible for establishing different othe policies relating to its employees at all levels that is the top, middle and lower level management. The commercial section is responsible for the top and middle, where as the GMS section is responsible for the lower management.

After the complete research relating to each of the given topics relating to employee motivation mentioned above we have made a detailed analysis separately. The summary of the analysis is as follows:

The organization’s productivity is improved by creating a learning environment throughout the year so that employees get motivated to update or improve their present skills, the employees remain satisfied with their job at PSO because they are encourage to communicate freely with their inline manager and can switch to different departments according to their abilities.

Their performance is recognized through out the year with different recognition programs and the best of all are the bonuses.

Many flexible benefits motivate the employees to achieve their individual and collective goals.

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METHODOLOGY

This research was conducted on the Pakistan State Oil to find out the position of motivation practices taking place in the local arena. Both the secondary and primary data was used to attain this objective. The literature review was made by incorporating the knowledge from certain published articles pertaining to the topic. Also the book and lectures related to the course of organizational behavior were used to make the questionnaire and interview.

The primary data includes the research conducted on the company itself. Interview was conducted from the expert. The data was finally compiled and evaluated with the help of the prior knowledge as well as the information gathered from the company.

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Mission

We are committed to leadership in energy market through competitive advantage in providing the highest quality petroleum products and services to our customers, based on:

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

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

Sustained growth in earnings in real terms Highly ethical, safe environment friendly and socially responsible

business practices

Vision

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

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Introduction:

PSO is first Pakistani public sector company to become a member of world

economic forum. PSO has established around 3700 retail outlets across the

country including 1459 new vision outlets commissioned within seven years.

PSO is leading national company committed to support an ongoing innovative

social and charitable projects in the field of education, health, welfare, women

empowerment etc.

PSO has been meeting the country's fuel needs by merging sound business sense with national obligation. In order to satisfy the customers' needs while ensuring the highest quality of products and services, PSO has introduced total quality management system in its operational activities.

Only Pakistani corporation to become member of the World Economic Forum based on stringent and forward looking criteria. Only company in Pakistan whose turnaround and remarkable performance is cited in various case studies both locally and internationally. Around 3,800 retail outlets across the country including 1,000 New Vision outlets commissioned within five years.

PSO is considered as a blue chip organization in stock exchange. It is fulfilling the need of fuel since 1976 and is trying every possible effort in order to improve and maintain quality of their product and the services provided by them, for this reason since 1998 they have tried to facilitate consumer so they have innovate their retail outlets with new vision. This is mainly in order to compete with their competitors; they are mainly shell and Caltex. PSO has a vast infra structure which is pervasive through out the country, as they have established twenty three depots which are spread in order to make their product available to every place in short time.

In PSO, operations are carried out by well trained and qualified employees

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who are mainly master’s from reputed institutions. In PSO, tasks are based on short term planning and every individual with in an organization are allocated with an especial task and are looked after by their managers till the accomplishment of the task.

In order to motivate their employees, PSO provides incentives by giving special rewards to those individuals who are dedicated to their work and perform their tasks well. The incentives are in the form of Bonuses for management staff, Hajj Balloting for non-management staff, Performance Excellence awards, etc.

HISTORY : The creation of Pakistan State Oil (PSO) can be traced back to the year 1974, when on January 1st; the government took over and merged Pakistan National Oil (PNO) and Dawood Petroleum Limited (DPL) as Premiere Oil Company Limited (POCL).

Soon after that, on 3rd June 1974, Petroleum Storage Development Corporation (PSDC) came into existence. PSDC was then renamed as State Oil Company Limited (SOCL) on August 23rd 1976. Following that, the ESSO undertakings were purchased on 15th September 1976 and control was vested in SOCL. The end of that year (30th December 1976) saw the merger of the Premier Oil Company Limited and State Oil Company Limited, giving way to Pakistan state Oil (PSO).

After PSO’s inception, the corporate culture underwent a comprehensive renewal program which was fully implemented in 2004. This program over the years included the revamping of the organizational architecture, rationalization of staff, employee empowerment and transparency in decision making through cross functional teams. This new corporate renewal program has divided the company’s major operations into independent activities supported by legal, financial, informative and other services. In order to reinforce and monitor this structural change, related check and balances have been established by incorporating monitoring and control systems. Human Resource Development became one of the main priorities on the company’s agenda under this corporate reform.

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SWOT Analysis

Strengths:

Well Established Infrastructure

One of the most powerful strengths of PSO is that it has a well established

infrastructure around 23 depots have been established from south to north. Also it has the

largest retail network and it is the biggest supplier of IPPs/ Hubco

Good market share in stock exchange

In stock exchange PSO is a blue chip organization with a market capitalization of

around 53 billions.

Latest Technology

Pso is equipped with latest equipments and specialized in latest technology such as:

Laser coding on lubricants, car wash plants, usage of tracking system to avoid theft and

leakage of lubricants.

Weaknesses:

Improper Control

Since it is the largest supplier of fuel within our country it is facing the problem of

quality control for that reason they are using quality control mobile facilities.

Lack of supply sources

Oil is supplied to the retail outlets through tank lorry and railway wagons from depots

which tend to take a lot of time to make the product available and is costly.

Opportunities:

Globalization

PSO has participated in the agreement among Pakistan, Iran and India in

Modification

PSO is working on to launch LPG in the retail outlets as they have done in the case of

CNG. For this reason they have set ten cars with LPG kits and are testing its

consumption as well as its efficiency.

Former CEO Mr. Tariq Kirmani has signed an agreement with Federal Government in