565 -OBassignment No2

8/2/2019 565 -OBassignment No2

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1 Groups and Teams in OrganizationsGroups are a ubiquitous part of organizational life. They are the basis for much of the work

that gets done, and they evolve both inside and outside the normal structural boundaries of the

organization. We will define agroup as two or more people who interact regularly to accomplish a

common purpose or goal. The purpose of a group or team may range from preparing a new

advertising campaign, to informally sharing information, to making important decisions, to

fulfilling social needs.

1.1 Types of Groups and Teams

In general, three basic kinds of groups are found in organizationsfunctional groups,

informal or interest groups, and task groups and teams.

A task group is one that is created by the organization to accomplish a relatively narrow

range of purposes within a stated or implied time horizon. In the aftermath of the crash of the space shuttle Columbia, numerous task groups were assembled to collect debris, analyze

information, and attempt to determine what went wrong. This team, for instance, is working on

debris from the wreckage in a hangar at Cape Canaveral. By attempting to reconstruct sections of

the shuttle, the team hopes to develop new methods for avoiding future disasters.

1.1.1 TYPES OF GROUPS IN ORGANIZATIONS

Every organization has many different types of groups. In this hypothetical organization, a

functional group is shown within the purple area, a cross-functional team within the yellow area,

and an informal group within the green area.

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1.1.1.1 Functional Groups A functional group is a permanent group created by the

organization to accomplish a number of organizational purposes with an unspecified time horizon.

The advertising department at Target, for example, seeks to plan effective advertising campaigns,

increase sales, run in-store promotions, and develop a unique identity for the company. It is

assumed that the functional group will remain in existence after it attains its current objectives

those objectives will be replaced by new ones.1.1.1.2 Informal or Interest Groups An informal or interest group is created by its own

members for purposes that may or may not be relevant to organizational goals. It also has an

unspecified time horizon. A group of employees who lunch together every day may be discussing

productivity, money embezzling, or local politics and sports. As long as the group members enjoy

eating together, they will probably continue to do so. When lunches cease to be pleasant, they will

seek other company or a different activity.

1.1.1.3 Informal groups can be a powerful force that managers cannot ignore. One writer

described how a group of employees at a furniture factory subverted their bosss efforts to increase

production. They tacitly agreed to produce a reasonable amount of work but not to work too hard.

One man kept a stockpile of completed work hidden as a backup in case he got too far behind. In

another example, autoworkers described how they left out gaskets and seals and put soft-drink

bottles inside doors. Of course, informal groups can also be a positive force, as demonstrated

recently when Continental Airlines employees worked together to buy anew motorcycle for

Gordon Bethune, the companys CEO, to show their support and gratitude for his excellent

leadership.

In recent years the Internet has served as a platform for the emergence of more and

different kinds of informal or interest groups. Just as one example, Yahoo! includes a wide array of

interest groups that bring together people with common interests. And increasingly workers who

lose their jobs as a result of layoffs are banding together electronically to offer moral support to

one another and to facilitate networking as they all look for new jobs.

1.2 Why People Join Groups and TeamsPeople join groups and teams for a variety of reasons. They join functional groups simply

by virtue of joining organizations. People accept employment to earn money or to practice their

chosen professions. Once inside the organization, they are assigned to jobs and roles and thus

become members of functional groups. People in existing functional groups are told, are asked, or

volunteer to serve on committees, task forces, and teams. People join informal or interest groups

for a variety of reasons, most of them quite complex. Indeed, the need to be a team player has

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grown so strong today that many organizations will actively resist hiring someone who does not

want to work with others.

1.2.1 Interpersonal Attraction One reason why people choose to form informal or interest

groups is that they are attracted to one another. Many different factors contribute to interpersonal

attraction. When people see a lot of each other, pure proximity increases the likelihood that

interpersonal attraction will develop. Attraction is increased when people have similar attitudes,

personalities, or economic standings.

1.3 STAGES OF GROUP DEVELOPMENT

As groups mature, they tend to evolve through four distinct stages of development.

Managers must understand that group members need time to become acquainted, accept one

another, develop a group structure, and become comfortable with their roles in the group before

they can begin to work directly to accomplish goals.

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1.3.1 Role Structures

Each individual in a team has a part, orrole, to play in helping the group reach its goals.

Some people are leaders; some do the work, some interface with other teams, and so on. Indeed, a

person may take on a task specialist role (concentrating on getting the groups task accomplished)

or a socio emotional role (providing social and emotional support to others on the team). A few

people, usually the leaders, perform both roles; a few others may do neither. The groups role

structure is the set of defined roles and interrelationships among those roles that the group or team

members define and accept. Each of us belongs to many groups and therefore plays multiple roles

in work groups, classes, families, and social organizations.

1.3.2 THE DEVELOPMENT OF A ROLE

Roles and role structures within a group generally evolve through a series of role

episodes. The first two stages of role development are group processes, as the group members let

individuals know what is expected of them. The other two parts are individual processes, as the

new group members perceive and enact their roles.

Role Ambiguity arises when the sent role is unclear. If your instructor tells you to write a

term paper but refuses to provide more information, you will probably experience role ambiguity.

You do not know what the topic is, how long the paper should be, what format to use, or when the

paper is due. In work settings, role ambiguity can stem from poor job descriptions, vague

instructions from a supervisor, or unclear cues from coworkers. The result is likely to be a

subordinate who does not know what to do. Role ambiguity can be a significant problem for both

the individual who must contend with it and the organization that expects the employee to perform.

Role Conflict occurs when the messages and cues composing the sent role are clear but

contradictory or mutually exclusive. One common form is inter role conflict conflict between

roles. For example, if a persons boss says that tone must work overtime and on weekends to get

ahead, and the same persons spouse says that more time is needed at home with the family,

conflict may result. In a matrix organization, inter role conflict often arises between the roles one

plays in different teams as well as between team roles and ones permanent role in a functional

group.

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Intra role conflictmay occur when the person gets conflicting demands from different

sources within the context of the same role. A managers boss may tell her that she needs to put

more pressure on subordinates to follow new work rules. At the same time, her subordinates may

indicate that they expect her to get the rules changed. Thus the cues are in conflict, and the

manager may be unsure about which course to follow.

Intra sender conflictoccurs when a single source sends clear but contradictory messages.This might arise if the boss says one morning that there can be no more overtime for the next

month but after lunch tells someone to work late that same evening. Person-role conflictresults

from a discrepancy between the role requirements and the individuals personal values, attitudes,

and needs. If a person is told to do something unethical or illegal, or if the work is distasteful (for

example, firing a close friend), person-role conflict is likely. Role conflict of all varieties is of

particular concern to managers. Research has shown that conflict may occur in a variety of

situations and lead to a variety of adverse consequences, including stress, poor performance, and

rapid turnover.

Role Overload A final consequence of a weak role structure is role overload, which

occurs when expectations for the role exceed the individuals capabilities. When a manager gives

an employee several major assignments at once, while increasing the persons regular workload,

the employee will probably experience role overload. Role overload may also result when an

individual takes on too many roles at one time. For example, a person trying to work extra hard at

work, run for election to the school board, serve on a committee in church, coach Little League

baseball, maintain an active exercise program, and be a contributing member to her or his family

will probably encounter role overload.

In a functional group or team, the manager can take steps to avoid role ambiguity, conflict,

and overload. Having clear and reasonable expectations and sending clear and straightforward cues

go a long way toward eliminating role ambiguity.

Consistent expectations that take into account the employees other roles and personal

value system may minimize role conflict. Role overload can be avoided simply by recognizing the

individuals capabilities and limits. In friendship and interest groups, role structures are likely to be

less formal; hence, the possibility of role ambiguity, conflict, or overload may not be so great.

However, if one or more of these problems does occur, they may be difficult to handle. Because

roles in friendship and interest groups are less likely to be partially defined by a formal authority

structure or written job descriptions, the individual cannot turn to those sources to clarify a role.

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1.4 INTERPERSONAL AND INTERGROUP CONFLICT

Of course, when people work together in an organization, things do not always go

smoothly. Indeed, conflict is an inevitable element of interpersonal relationships in organizations.

We look at how conflict affects overall performance. We also explore the causes of conflict

between individuals, between groups, and between an organization and its environment.

1.5 THE NATURE OF CONFLICT

Conflictis a disagreement among two or more individuals, groups, or organizations.

This disagreement may be relatively superficial or very strong. It may be short-lived or

exist for months or even years, and it may be work related or personal. Conflict may manifest itself

in a variety of ways. People may compete with one another, glare at one another, shout, or

withdraw. Groups may band together to protect popular members or outrun popular members.

Organizations may seek legal remedies.

Most people assume that conflict is something to be avoided because it connotesantagonism, hostility, unpleasantness, and dissension. Indeed, managers and management theorists

have traditionally viewed conflict as a problem to be avoided.24 In recent years, however, we have

come to recognize that, although conflict can be a major problem, certain kinds of conflict may

also be beneficial. For example, when two members of a site selection committee disagree over

the best location for a new plant, each may be forced to more thoroughly study and defend his or

her preferred alternative.

As a result of more systematic analysis and discussion, the committee may make a better

decision and be better prepared to justify it to others than if everyone had agreed from the outset

and accepted an alternative that was perhaps less well analyzed. As long as conflict is being

handled in a cordial and constructive manner, it is probably serving a useful purpose in the

organization. On the other hand, when working relationships are being disrupted and the conflict

has reached destructive levels, it has likely become dysfunctional and needs to be addressed. We

discuss ways of dealing with such conflict later in this chapter.

The general relationship between conflict and performance for a group or organization

shows if there is absolutely no conflict in the group or organization, its members may become

complacent and apathetic. As a result, group or organizational performance and innovation may

begin to suffer. A moderate level of conflict among group or organizational members, on the other

hand, can spark motivation, creativity, innovation, and initiative, and raise performance. Too much

conflict, though, can produce such undesirable results as hostility and lack of cooperation, which

lower performance. The key for managers is to find and maintain the optimal amount of conflict

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that fosters performance. Of course, what constitutes optimal conflict varies with both the situation

and the people involved.

1.6 Causes of Conflict

Conflict may arise in both interpersonal and intergroup relationships. Occasionally conflict between individuals and groups may be caused by particular organizational strategies and

practices. A third arena for conflict is between an organization and its environment.

1.6.1 Interpersonal Conflict

Conflict between two or more individuals is almost certain to occur in any organization,

given the great variety in perceptions, goals, attitudes, and so forth among its members. William

Gates, founder and CEO of Microsoft, and Kazuhiko Nishi, a former business associate from

Japan, ended a long-term business relationship because of interpersonal conflict. Nishi accused

Gates of becoming too political, while Gates charged that Nishi became too unpredictable and

erratic in his behavior.

A frequent source of interpersonal conflict in organizations is what many people call a

personality clashwhen two people distrust each others motives, dislike each other, or for

some other reason simply cannot get along.29 Conflict may also arise between people who have

different beliefs or perceptions about some aspect of their work or their organization. For example,

one manager might want the organization to require that all employees use Microsoft Office

software, to promote standardization.

Another manager might believe that a variety of software packages should be allowed, in

order to recognize individuality. Similarly, a male manager may disagree with his female colleague

over whether the organization is guilty of discriminating against women in promotion decisions.

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Conflict can also result from excess competitiveness among individuals. Two people vying

for the same job, for example, may resort to political behavior in an effort to gain an advantage. If

either competitor sees the others behavior as inappropriate, accusations are likely to result. Even

after the winner of the job is determined, such conflict may continue to undermine interpersonal

relationships, especially if the reasons given in selecting one candidate are ambiguous or open to

alternative explanations. Robert Allen resigned as CEO of Delta Air Lines a few years ago becausehe disagreed with other key executives over how best to reduce the carriers costs. After he began

looking for a replacement for one of his rivals without the approval of the firms board of directors,

the resultant conflict and controversy left him no choice but to leave.31 More recently, similar

problems have plagued Boeing as its top executives have publicly disagreed over routine matters

and sometimes gone to great lengths to make each other look bad.

1.6.2 Intergroup Conflict

Conflict between two or more organizational groups is also quite common. For example,

the members of a firms marketing group may disagree with the production group over product

quality and delivery schedules. Two sales groups may disagree over how to meet sales goals, and

two groups of managers may have different ideas about how best to allocate organizational

resources.

Many intergroup conflicts arise more from organizational causes than from interpersonal

causes. There are three forms of group interdependencepooled, sequential, and reciprocal.

Just as increased interdependence makes coordination more difficult, it also increases the potential

for conflict. For example, in sequential interdependence, work is passed from one unit to another.

Intergroup conflict may arise if the first group turns out too much work (the second group will fall

behind), too little work (the second group will not meet its own goals), or poor-quality work.

At one J. C. Penney department store, conflict arose between stockroom employees and

sales associates. The sales associates claimed that the stockroom employees were slow in

delivering merchandise to the sales floor so that it could be priced and shelved. The stockroom

employees, in turn, claimed that the sales associates were not giving them enough lead time to get

the merchandise delivered and failed to understand that they had additional duties besides carrying

merchandise to the sales floor.

Just like people, different departments often have different goals. Further, these goals may

often be incompatible. A marketing goal of maximizing sales, achieved partially by offering many

products in a wide variety of sizes, shapes, colors, and models, probably conflicts with a

production goal of minimizing costs, achieved partially by long production runs of a few items.

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One group of managers wanted to introduce a new sportswear line as quickly as possible, but other

managers wanted to expand more deliberately and cautiously. Because the two groups were not

able to reconcile their differences effectively, conflict between the two factions led to quality

problems and delivery delays that plagued the firm for months.

Competition for scarce resources can also lead to intergroup conflict. Most organizations

especially universities, hospitals, government agencies, and businesses in depressed industrieshave limited resources. In one New England town, for example, the public works department and

the library battled over funds from a federal construction grant. The Buick, Pontiac, and Chevrolet

divisions of General Motors have frequently fought over the right to manufacture various new

products developed by the company.

1.6.3 Intergroup Conflict in the Workplace

It defines a group as "a number of persons near, placed, or classified together." Others

define a group as a "social unit that consists of a number of individuals (1) who, at a given time,

have role and status relationships with one another, stabilized in some degree and (2) who possess

a set of values or norms regulating the attitude and behavior of individual members, at least in

matters of consequence to them."

Intergroup relations between two or more groups and their respective members are often

necessary to complete the work required to operate a business. Many times, groups inter-relate to

accomplish the organization's goals and objectives, and conflict can occur. Some conflict, called

functional conflict, is considered positive, because it enhances performance and identifies

weaknesses. Dysfunctional conflict, however, is confrontation or interaction between groups that

harms the organization or hinders attainment of goals or objectives.

1.6.3.1 Causes of Intergroup Conflict

One of the most prominent reasons for intergroup conflict is simply the nature of the group.

Other reasons may be work interdependence, goal variances, differences in perceptions, and the

increased demand for specialists. Also, individual members of a group often play a role in theinitiation of group conflict. Any given group embodies various qualities, values, or unique traits

that are created, followed, and even defended. These clans can then distinguish "us" from "them."

Members who violate important aspects of the group, and especially outsiders, who offend these

ideals in some way, normally receive some type of corrective or defensive response. Relationships

between groups often reflect the opinions they hold of each other's characteristics. When groups

share some interests and their directions seem parallel, each group may view the other positively;

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however, if the activities and goals of groups differ, they may view each other in a negative

manner. When trying to prevent or correct intergroup conflict, it is important to consider the

history of relations between the groups in conflict. History will repeat itself if left to its own

devices. Limited resources and reward structures can foster intergroup conflict by making the

differences in group goals more apparent. Differences in perceptions among groups regarding time

and status, when coupled with different group goals, can also create conflict. Reorganization of theworkplace and integration of services and facilities can be stressful to some and create negative

conflict. Some individuals within the group have inherent traits or social histories that impact

intergroup conflict, but problems within intergroup relations are not usually caused by the deviate

behavior of a few individuals.

1.6.3.2 Consequences of Intergroup Conflict

Intergroup conflict causes changes to occur, both within the groups in conflict and between

them. Within the groups, members will usually overlook individual differences in an effort to unite

against the other side, and with this concerted effort the focus is on the task. The group can become

more efficient and effective at what they do, and members can become more loyal, closely

following group norms. Problems can occur, however, when the group loses focus of the

organization's goals and becomes closed off from other groups. Haughtiness and isolation quickly

lead to decreased communication. Communication is the key between groups in reciprocal

interdependence, and these have the highest negative consequences for lack of effective

communication. Miscommunication can be the death knell of any organization.

1.6.3.3 Managing Conflict in Organizations

How do managers cope with all this potential conflict? Fortunately, there are ways to

stimulate conflict for constructive ends, to control conflict before it gets out of hand, and to resolve

it if it does. Below we look at ways of managing conflict.

1.7 Stimulating Conflict

In some situations, an organization may stimulate conflict by placing individual employees

or groups in competitive situations. Managers can establish sales contests, incentive plans,

bonuses, or other competitive stimuli to spark competition. As long as the ground rules are

equitable and all participants perceive the contest as fair, the conflict created by the competition is

likely to be constructive because each participant will work hard to win (thereby enhancing some

aspect of organizational performance).

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Another useful method for stimulating conflict is to bring in one or more outsiders who

will shake things up and present a new perspective on organizational practices. Outsiders may be

new employees, current employees assigned to an existing work group, or consultants or advisors

hired on a temporary basis. Of course, this action can also provoke resentment from insiders who

feel they were qualified for the position.

The Beecham Group, a British company, once hired an executive from the United Statesfor its CEO position, expressly to change how the company did business.

His arrival brought with it new ways of doing things and a new enthusiasm for

competitiveness. Unfortunately, some valued employees also chose to leave Beecham because they

resented some of the changes that were made. Changing established procedures, especially

procedures that have outlived their usefulness, can also stimulate conflict. Such actions cause

people to reassess how they perform their job and whether they perform it correctly. For example,

one university president announced that all vacant staff positions could be filled only after written

justification had received his approval. Conflict arose between the president and the department

heads, who felt they were having to do more paperwork than was necessary. Most requests were

approved, but because department heads now had to think through their staffing needs, a few

unnecessary positions were appropriately eliminated.

1.8 Controlling Conflict

One method of controlling conflict is to expand the resource base. Suppose a top manager

receives two budget requests for $100,000 each. If she has only $180,000 to distribute, the stage is

set for conflict because each group will believe its proposal is worth funding and will be unhappy

if it is not fully funded. If both proposals are indeed worthwhile, it may be possible for the

manager to come up with the extra $20,000 from some other source and thereby avoid difficulty.

As noted earlier, pooled, sequential, and reciprocal interdependence can all result in

conflict. If managers use an appropriate technique for enhancing coordination, they can reduce the

probability that conflict will arise. Techniques for coordination (described in Chapter 11) include

making use of the managerial hierarchy, relying on rules and procedures, enlisting liaison people,

forming task forces, and integrating departments. At the J. C. Penney store mentioned earlier, the

conflict was addressed by providing salespeople with clearer forms on which to specify the

merchandise they needed and in what sequence. If one coordination technique does not have the

desired effect, a manager might shift to another one.

Competing goals can also be a source of conflict among individuals and groups. Managers

can sometimes focus employee attention on higher-level or super ordinate, goals as a way of

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eliminating lower-level conflict. When labor unions like the United Auto Workers make wage

concessions to ensure survival of the automobile industry, they are responding to a super ordinate

goal. Their immediate goal may be higher wages for members, but they realize that, without the

automobile industry, their members would not even have jobs.

Finally, managers should try to match the personalities and work habits of employees so as

to avoid conflict between individuals. For instance, two valuable subordinates, one a chain smokerand the other a vehement antismoker, probably should not be required to work together in an

enclosed space. If conflict does arise between incompatible individuals, a manager might seek an

equitable transfer for one or both of them to other units.

1.9 RESOLVING AND ELIMINATING CONFLICT

Despite everyones best intentions, conflict sometimes flares up. If it is disrupting the

workplace, creating too much hostility and tension, or otherwise harming the organization,

attempts must be made to resolve it. Some managers who are uncomfortable dealing with conflictchoose to avoid the conflict and hope it will go away. Avoidance may sometimes be effective in

the short run for some kinds of interpersonal disagreements, but it does little to resolve long-run or

chronic conflicts.

Even more unadvisable, though, is smoothingminimizing the conflict and telling

everyone those things will get better. Often the conflict only worsens as people continue to

brood over it.

Compromise is striking a middle-range position between two extremes. This approach can

work if it is used with care, but in most compromise situations, someone wins and someone loses.

Budget problems are one of the few areas amenable to compromise because of their objective

nature. Assume, for example, that additional resources are not available to the manager mentioned

earlier. She has $180,000 to divide, and each of two groups claims to need $100,000. If the

manager believes that both projects warrant funding, she can allocate $90,000 to each. The fact

that the two groups have at least been treated equally may minimize the potential conflict.

The confrontational approach to conflict resolutionalso called interpersonal problem

solvingconsists of bringing the parties together to confront the conflict. The parties discuss the

nature of their conflict and attempt to reach an agreement or a solution. Confrontation requires a

reasonable degree of maturity on the part of the participants, and the manager must structure the

situation carefully. If handled well, this approach can be an effective means of resolving conflict.

In recent years, many organizations have experimented with a technique called alternative dispute

resolution, using a team of employees to arbitrate conflict in this way.

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Regardless of the approach, organizations and their managers should realize that conflict

must be addressed if it is to serve constructive purposes and be prevented from bringing about

destructive consequences. Conflict is inevitable in organizations, but its effects can be constrained

with proper attention. For example, Union Carbide sent 200 of its managers to a three-day

workshop on conflict management. The managers engaged in a variety of exercises and

discussions to learn with whom they were most likely to come in conflict and how they should tryto resolve it. As a result, managers at the firm later reported that hostility and resentment in the

organization had been greatly diminished and that people in the firm reported more pleasant

working relati

1.9.1 Solutions to Intergroup Conflict

There are numerous choices available to circumvent conflict, to keep it from becoming

damaging, and to resolve conflict that is more serious. These include simple avoidance where

possible, problem solving, changing certain variables in the workplace, and in-house alternative

dispute resolution (ADR) programs. Any resolution method should depend on why the conflict

occurred, the seriousness of the conflict, and the type. A face-to-face meeting, as in problem

solving, can be very effective in conflicts of misunderstanding or language barriers. The groups

can discuss issues and relevant information, with or without a facilitator, to reach resolution.

Where groups have differing goals, it may be prudent to establish some type of goal that can only

be reached when the conflicting groups work together. A superordinate goal not only helps

alleviate conflict, it focuses more on performance, which is what the organization needs to survive.

A downside to this option is the identification of a common enemy of the conflicting groups, who

must come together to prevail. Eventually, the solidarity crumbles and groups begin to again turn

against each other. Another stopgap solution to conflict is simply avoiding it. Although this does

not resolve the problem, it can help get a group through a period of time, in which those involved

may become more objective, or a greater, more immediate goal would have been met. Along those

lines, another solution is smoothing the groups by focusing on common interests and de-

emphasizing the differences between them. This approach is especially effective on relatively

simple conflicts and is viewed as a short-term remedy. Yet another quick fix is the authoritative

command, where groups, who cannot satisfactorily resolve their conflict, are commanded by

management. This response does not usually deal with the underlying cause of the conflict, which

is likely to surface again in some way. This would probably be a choice of last resort in this era of

individual independence and self-determination. Although it is not always possible to change a

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person's behavior, by focusing on the cause of the conflict and the attitudes of those involved, it

will lead to a more permanent resolution. It is also possible to change the structural variables

involving the conflicting groups, such as changing jobs or rearranging reporting responsibilities.

This approach is much more effective when the groups themselves participate in structural change

decisions. Without meaningful input, this resolution method resembles avoidance or forcing and is

not likely to succeed, further frustrating all involved. Any method or response to conflict, lostproductivity, miscommunication, or unhealthy work environment can be reconstituted in many

forms of ADR. Alternative dispute resolution should also be appropriate to the needs of those

involved. It is crucial that the organization determines the needs of its stakeholders, the types of

conflict that occur, and the conflict culture (how conflict is dealt with) within the organization

before initiating an ADR program. Any program must allow for creativity, approachability, and

flexibility if people are asked to utilize it. All employees should be aware or involved in the

establishment of an ADR program, if it is to work properly. Without full involvement or input,

needs assessment is hit or miss, and assumptions lead to actions, which lead to the same place you

were before. This assumicide behavior by an organization's leadership would not be tolerated in

marketing a new product or acquiring a capital asset, so why are people less important?

Any collaborative process intended to address and manage intergroup conflict should have

objectives to encourage it. In this major commitment of time and resources, success is its best

reward, but to ensure an ADR approach suitable for you, it is important to:

Build trust

Clearly define participants' roles and authorities

Establish ground rules

Promote leadership

Bring a collaborative attitude to the table

Maintain participant continuity

Recognize time and resource constraints

Address cultural differences and power imbalances

Build accountability and organizational commitment

Make this a consensus process

Produce early measurable results

Link decision making and implementation

Promote good communication and listening skills

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Conflicts within or between groups can be destructive or constructive, depending on how

the conflict is handled. When an organization is creating a dispute resolution process, there are key

factors to success:

1.A critical mass of individuals who are committed to the process;

2.A leadership group who perceive it in their best interest and the best

interests of the people they serve;3.Strategic cooperation among historical enemies;

4.Realistic and satisfactory outcomes;

5.A moratorium on hostilities or conflict-seeking behavior.

There also are barriers to success:

1. Fear of losing power;

2. Unwillingness to negotiate;

3. No perceived benefit;

4. Corporate philosophy;

5. Top leadership reluctance;

6. Lack of knowledge about ADR;

7. Lack of success stories.

Responsible measures to reduce barriers and encourage a true paradigm shift are training,

incentives, marketing, periodic review, case studies, and top management support and

participation. Facilitators trained in mediation and other forms of ADR are a necessary resource

from outside or within the organization. The workplace of the new millenium will have in-house

mediation or other conflict management programs to reduce formal claims and act as a risk

management business practice.

2 Practical Study of the organization:

2.1 History of PARCO

PARCO was established in 1972 as joint venture between the governments of Pakistan and

Abu Dhabi and to run and operate petroleum refineries, cross country crude / product pipeline and

storage in Pakistan.

For this purpose the first project was completed in 1981, by laying an 864 km 16 dia

pipeline from Karachi to Gujrat (Mahmood Kot). This pipe line is in operation from last 21 years.

This pipeline was laid as a first phase for the mid country oil refinery. The aim was to transport oil

from Karachi to other parts of the country with less transportation and maintenance cost. So from

1982 PARCO was in the Business of Transportation. They received the oil of marketing

companies and give the facility of transportation from Karachi to Mahmood Kot.

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Previously there were some problem in storage and handling. In 1990 they increased their

storage capacity by 50,000 at Korrangi and got the facility of direct discharge of tankers at

Keamari and pumping it to Korrangi.

PAK ARAB REFINERY LTD (PARCO) with 60% of the share holding is by the

Government of Pakistan and 40% by the Emirate of Abu Dhabi through its Abu Dhabi Petroleum

Investment Company (ADPI), a subsidiary group of International Petroleum Investment Company(IPIC).

The Refinery capacity is around 4.5 million tons per annum equivalent to a processing

throughput of 100,000-barrels/ day of a mixed Arabian Light/ Upper Zakum/ crude slate, which is

being transported to the Refinery site by PARCO's Keamari to Mahmood Kot (KMK) pipeline

system from Karachi. The maximum production of refinery is 110000-barrels/day, but the

consumed production is 80000-barrels/day. The city of Multan, only 65 km, from the Refinery is

well connected with a national communications network of rail, road and air. The nearest rail link

is through Mahmood Kot, which is about five kilometers from the Refinery.

Within a 30 km radius of the refinery, there are two thermal power complexes at Kot Addu

and Muzaffargarh having a capacity of 1,500 and 1,300 MW respectively. With the

commencement of Refinery operations the companies consequently plan to market its fuel

products, LPG and Lubricants through own and franchised PEARL retail depots and distribution

facilities. Off take agreement have already been signed with SHELL, CALTEX and PSO for the

uplift ment of 75% off all products of MCR. For remaining 25% production an agreement has

signed with TOTAL (France).

MISSION

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To maintain PARCOs flagship role in the countrys energy sector by making it a fully

integrated oil conglomerate through broader vision, accentuated drive and professional

excellence. A continuous struggle is needed to make PARCO a symbol of success that

can offer unmatched benefits to its owners, employees, business associates and the

community it operates in.

VISIONFor PARCO to remain among tomorrow's corporate winners.

They explain their vision statement in following way:

it may not only need to have a clear vision but also a passion for translating that vision into

reality. The big challenge is therefore, not only trying to figure out what future will be the right

one, but to choose a future that will give definite competitive advantage to the Company over the

long-term. Therefore, creating a cause for action besides charting a course on how to get there.

2.2 Data collection methods / Methodology

The applied method in the study is the use of secondary information. Through this method, the

study can gain advantages that are helpful in the continuous progress of the investigation. One of

those advantages is to discover the literature gaps because of the review done to the past studies

concerning the same subject. In addition, through the collection of information

2.3 FINANCIAL ANALYSIS:

PARCO, net profit has crossed Rs.3 billion Mark. PARCO has generated significant benefits for

the national economy against GOP's initial investment of Rs. 324 million. Unto 2001 it has paid

the following amounts to Government

Custom Excise Duty Rs.1469 million

Income Tax Rs.5385 million

Dividend Rs.3804 million

Beside PARCO has enabled Government of Pakistan to save in freight pool Rs.13658 million.

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CAPITAL STRUCTURE (in million)

Expanded Shareholders' Equity from Rs. 540 million to Rs. 13 billion (by over 24 times)

Equity Financing of vital energy sector projects completed or under implementation: -

2.4 MAJOR PRODUCTS OF COMPANY

The PARCO is operating in different business of oil. They have near about 10 products or

brand. All these brands have huge demand and known well by peoples due to their quality. The

brand name of products is given in the table below.

Products

Motor Sprit (87 RON) Motor Sprit (90 RON)

High Speed Diesel Oil (HSD) Kerosene

Jet Fuel 1 Jet Fuel 4

Low Speed Diesel Oil (LDO) Furnace Oil

LPG Crude Oil

2.5 DEPARTMENTS OF PARCO

In PARCO there are nine (9) departments, which are working day and night for the

progress of the Refinery and for the welfare of the employees. There is also sub-departments under

these main departments. The main departments include:

Electric and Instruments Utilities and Offside

Process department Shipping and Excise

Personnel and Administration Health, Safety & Environment

Technical Services Engineering Services

Mechanical and maintenance

2.5.1 INTERNAL CULTURE OF PARCO

The 1,600 employees operate the Mid-Country Refinery round the clock but environment

at PARCO is just like a family. There is strong coordination and social bonding among different

levels of employees. A low level worker can access the high level manager without any hindrance.

It is fully employee-oriented firm in which employees are the most important asset for the

company. When the Government went for downsizing, PARCO contacted to the Ministry of

INITIAL (1981) PRESENT

Authorized Capital 1,500 5,000

Paid-up-Capital 540 2,160

GOP 324 1,296

*ADPI 216 864

Reserves 1 14,340

Long Term Loan 1,115 52,762Debt: Equity Ratio 67:33 77:23

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petroleum and requested in the favor of their employees. It has decentralized structure and team

based environment. Employees work in teams so that they may able to work together more

efficiently. No unionization is there. To avoid such problems all low level workers are hired at

contractual basis and other management workers are on permanent jobs. PARCO is very much

conscious about the education of employees. It hires highly qualified and competent persons. They

sayWe believe on giving the designation to employees according to their qualification.

There is restriction that the applicant will be eligible to apply for a job if he has at least A grade

throughout his education.

2.5.2 Facilities for the Employees

PARCO provides different facilities to its employees according to their designations. It

tries to satisfy their employees by giving them different facilities such as:

1. Housing Complex:

Different residential apartments are given to the workers. There are different categories of

houses. For bachelor employees there are Bachelors Hostels in which, there are two categories one

is for administrated staff and other for technical workers. Employees are provided with apartment,

houses, and bungalows as the got promotions.

2. Bloomfield Hall School:

A school is established with the coordination of Bloomfield Hall School system for

employees children. Building is provided by PARCO and the mutual management i.e. of is here to

manage the school. Staff is hired with the coordination of PARCO and Bloomfield Hall

administration. Vice Principal Mrs. Shaista Qureshi handle all the operations related to this branch.

3. Officers Club:

For recreation of employees officer club is established. Employees get the memberships of

this club and renew it annually. Different sort of activities are done by this club. Melodious Geet &

Ghazal Evenings and Sports Mania are some of the activities that are held by officers club.

4. Hajj policy:

PARCO provides the opportunity of offering Hajj to their employees on its behalf. For this

purpose, every year some employees are selected from different department by lucky draw.

5. Ibn-e-Sina Hospital

PARCO is more conscious about there employees health. For this purpose certain hospitals

in which Ibn-e-Sina is one of them. There are separate hospitals for technical and administration

staff. All the facilities are available in these hospitals.

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2.5.3 HUMAN RESOURSE

HRD at Mid country Refinery:

All the issues and operation related to the personnel at mid country refinery are controlled

by its HR manager Mr. Mansoor Bin Kafeel. The hiring decision related to very low level worker

are taken by him. But the major operations are performed after the approval of GM Corporate

Affairs at head office Karachi.Diverse cultural backgrounds and multi-ethnic origins add up to create a strong resource

base at PARCO. Each member makes a valuable contribution while overall functioning as a team.

Committed to doing more for their country, PARCO people remain dedicated and passionate about

their work. PARCO people are focused on broadening horizons and meeting new challenges.

Creative and multi-talented, these fine individuals take pride in shaping the future of

Pakistan.Different Issues Related With HR Department

Social Responsibilities:

PARCO is very much concerned about social responsibilities. it performs many activities

which gives proof about it. Some of these are following:

Safety Programs:

PARCO give more importance to the safety of employees. Different sessions and trainings

are conducted to give the awareness to the employees about their safety. Safety Walks are also

conducted annually before the Performance Award Ceremony. Safety Walk 2006 was conducted

November 16 2006.

Clean Environment:

There is great stress on the clean environment. Different precautions are adopted in this

concern. To appreciate PARCOs efforts in this regards, soon after securing trip quality

certification for its Mid-Country refinery, PARCO notched another quality achievement in the

form of Environment Excellent Award, 2006. The award is in appreciation of PARCOs concern

for environment, its environment-friendly policies as well as investments in this regards.

Awareness about Cancer:

With the coordination of Shaukat Khanum Cancer hospital, they try to create awareness in

the society about cancer. They sponsor many walks, seminars and meetings in this regards.

2.5.4 Managers responibilities.

The critical battleground in career development is inside the mind of the person charged

with supervisory responsibility. So in PARCO, Senior Management executive is responsible for

communicating career options to the technical and administrative staff. PARCO believes in that

The weakness of employee is the weakness of manager and the strength of employee is the

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strength of manager. It is the responsibility of manager to develop his team, identify the weak

areas of every individual and then offer training in that areas where the training is needed.

Problems in Performance Measurement & Evaluations:

Although Personnel Department tries to communicate a fair and smooth appraisal system

but due to some reasons, the inaccuracy in performance measurement occurs. The reasons for this

include:1.Organizational Influences.

2.Personal Biasness.

3.Difficult To Set Qualitative Standards.

There are also some problems, which the personnel department has to face in the accurate

evaluation of the measured performance. The problems include:

1.Subjective Standards.

2.Rating errors.

3.Negative Communication.

But the personnel department believes that its performance appraisal system is still working

fine. They have strong intensity of the relationship in the organization.

SWOT ANALYSIS

Strength:

PARCO is the largest oil refinery in Pakistan. Its production capacity is more than the capacity

of other refineries combined. Its size gives the opportunity to capture the market share and

dominate the competitors.

PARCOs 1228 km pipeline network distinguishes it from the competitors. It has very managed

network for the supply of crude oil.

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PARCO has achieved an AAA credit rating. This credit rating is issued by the credit rating

agencies for the payment of the long-term loans.

PARCO employees are very much committed to their work. They behave like they are in

business for their selves. They have free access to the management and their suggestions and

recommendations are given serious considerations.

PARCO is first ever oil refinery in Pakistan involved in the refining, distribution through

pipelines and marketing of its products. By integrating the upstream and downstream activities,

the company has been able to manage the functions well and get margin from each activity.

Opportunities:

Over all demand of the petroleum products is increasing at the rate of 5-10% in Pakistan.

Especially in northern region rate is even more so this provides the substantial opportunity.

Most of the oil refineries are located in upper side or low side. There was no refinery in

northern side so this will provide an opportunity to market the products in this region and this

region also provides a substantial growth potential in future.

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300,000 millions tons of gasoline is surplus every year. The excess gasoline can be used to earn

the export revenues by selling it to foreign countries.

Weaknesses:

Now being in the competition with the big oil marketing companies, PARCO has not yet

realized the importance of advertising and other promotional activities. On the other side PSO,

SHELL, and CALTAS are spending heavy amounts on the promotion of their products.

PARCO mid country refinery (MCR) is running at the 70% of its capacity. This means that they

are producing 20,000 BPD less than what they can. If this would remain the practice, the

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company would be facing difficulties in future. They can never reap the advantage of size and

economies of scale would never be achieved.

PARCO mostly rely on foreign marketing companies for marketing of oil products.

At present they are not utilizing their capacity fully and they are utilizing only 80% of total their

capacity. So for removing this condition they need strong marketing campaign because it will

create the awareness among the people, which will be helpful for increasing the demand of

PARCO products. This marketing effort not only will be helpful for selling 25% but also for

the utilization of full capacity.

Threats:

PARCOs mid country refinery has been newly established it might have to face the problems

to get the order from oil marketing companies. OMCs have their long-term agreements with

oil refineries and they are bound to fulfill their agreements. In this situation it would be tough

job for the PARCO to show its presence in the market.

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Country is facing uncertain economic and political situation. Oil prices fluctuate and they are

not stable. This economic uncertainty has direct impact upon the future of the company. During

recession OMCs decrease the purchase quantity of oil and this creates a surplus for the

company. The company has no proper utilization of this surplus and ultimately they have to

reduce the production, which has negative impact on the profitability of the company.

CONCLUSION:

Parco is one billion dollar sophisticated state-of-the-art refinery. The company is strong

due to its human resource. The elements such as competence in management, well defined policy

and procedures making mechanism ability, and committed leadership present in natural order that

makes the PARCO AAA rating firm since the last four years.

PARCO expansion is upstream and downstream through ventures and alliances. For

backward integration PARCO develop pipeline network from Karachi to PARCO destination. The

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managerial decision of pipeline network reduce the cost of Value System by million of dollars of

every year.

As far as the forward integration is concerned PARCO venture with the French based oil

retailing company and serve the national market as OMC (Oil Marketing Company). This decision

increases the average capacity utilization of plant.

PARCO also improve its forward integration strategy by alliance with other OMCsparticularly with PSO by supplying the crude oil to KAPCO through the pipeline which is owned

by PSO. PARCO also share the storage units of PSO for other forward integration activities.

RECOMMENDATIONS:This time when industry is fully mature, and the competition in terms of access to final

consumer is very high the companies usually face the problems of slow demand growth, emphasize

on differentiation and services, marketing. Although they have tackled the problems very well but

there is always need for the cope with the changing world, so some proposed strategies are as

follows.

MARKET DEVELOPMENT

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PARCO should look for the export of its Petroleum products specially the LPG that is in

excess of demand. This will not only help to keep the operations efficient but also to earn a very

valuable foreign exchange for the country.

MARKET PENETRATION

PARCO has already signed an agreement with the SHELL, CALTEX and PSO for the

uplift of 75% of all its products. But with the remaining 25%, which is almost 1.2 million tons peryear, they have to increase their marketing efforts to sell it out. They need to promote their

products because they have to face a very tough competition form old market players including

multinationals.

IMPLEMENTATION PLAN

We have presented the different proposed strategies, now we talk about the implementation

plan for the achievement of these proposed strategies.

For the implementation of the Market Penetrating strategy PARCO peoples can penetrate

the market by advertisement on

1. TV

2. NEWPAPERS

3. OUTDOORS HOARDINGS

TV is most effective media to promote the product. Because it helps to creates the

awareness and has mass media access and best for their marketing and selling efforts. During the

timing of cricket matches, they can attract the attention of viewers.

For the implementation of Market Development Strategy It is keen to find the off shore

markets for their products. Government of Pakistan should take personal interest and find the

markets in Japan and other far eastern countries can be a good market for their products.

TECHNOLOGICAL FACTORS: In this ever-changing world of business only those will

be surviving who have got latest technology and they have complete knowledge this technology.

PARCO is very good in both technology and the use of technology.

REFERENCES

Stanley Holmes, Nike: Can Perez Fill Knights Shoes?Business Week,November 19,

2004,

www.businessweek.com

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Stanley Holmes, Inside the Coup at Nike,Business Week, February 6, 2006,

www.businessweek.com on May 20, 2006;

Stanley Holmes, Nikes CEO Gets the Boot,Business Week, January 24, 2006,

www.businessweek.com

Daniel Roth, Can Nike Still Do It Without Phil Knight?Fortune, April 4, 2005,

www.fortune.com

Annexure 1

COMPARATIVE ANALYSIS OF PRL AND PARCO:

Structure

PRL PARCOCultural Issues Yes NoIdentification of/ address tothe Labor Needs

During training by having close and goodrelationships with CBA

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Organization Networking E mails, Telephones and weeklymeetings

on the intranet daily and monthly meetings celebrate family day every year

Remuneration Recently a salary survey wasconducted through third party

quarterly

TNA, performanceappraisals

Goal based performance and IPF(Individual Performance factors)

Performance targets & Behaviorcompetencies

Compensation Policies Promotions

VPP Spark awards SRA (Special RecognitionAwards)

Rating as poor, good &

outstanding. Employee of the month

Kind of Leadership between the Leaders andthe Followers

Not very healthy due totransformational changes would probably take 5 years tobuild a healthy relationship

Good team work and closerelationships

The Best Practices

PRL PARCOBest practices learned Going towards openness in

communication. Trying to develop task forces andteams. Adoption of best practices fromMNCs. Approachability of Sr.Management. Delegation of task

Through KPIs

Ethical Behavior Ethics policies, EthicsCommittee monitors and resolvesethical issues and dilemmas

Through PMP(performance mgt process)

EmployeeDevelopment

Extensive trainings Indoor/Outdoor 16 Hrs/year/employee training

On Need basis

Stress Management Sports and games Stress Management programsHandle Conflict As per the policies or otherwise

by counseling Through demonstration

2.5.4.1 Employee Engagement

PRL PARCOImprovement in Peopleskill

Through trainings Through trainings through job rotation

Job Design

Rotation is done on need

basis. Enhancement is doneaccording to the skill level andexperience of employees.

Rotation is done on need basis.

If any employee wants to changedepartment he needs to get NOCdocument approved from head.

Change Management

PRL PARCOOrganizational Change,Example

Not managed, opening line ofcommunication upward

By PMP, using surveys andinterview of employees Adopted the policies from BritishPetroleum

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Compliance withGovernment standards

Continuous improvement ofprocesses Bi- annual audits

No strict policies observed.

Gauging Behavior

PRL PARCO

Employee Attitude By Satisfaction surveys By PMP By visual observation

Salary Structure Nothing general salary levels are known butnot the individuals salary

Absenteeism andTurn over

line managers to report it toHR

Strict discipline. If a person is late more than 3 daysin a month he loses his leaves If a person is late more than 7 dayshe gets dismissed.

PARCO CORPORATE ACHIEVEMENTS & MILESTONES

Commissioning of Karachi-Mahmood Kot crude -cum-product

pipeline system

1981

Additional 50,000 tons of Storage facility at Korrangi and directdischarge of ships into PARCO network to ease pressure onKeamari Oil Piers (DKF).

1990

Introduction of flow improving technology to increase pipelineinstalled capacity of 2.9 to 4.0 million tons/ annum.

1992

Completion of Bubak and Fazilpur Pumping stations, furtherraising the pumping capacity by 50%.

1994

System UP-gradation/Modernization: Telecom & SCADA,Revamping, Intelligent Pigging & Pipeline Rehabilitation

1995

Completion & Commissioning of 360 kms Pipeline Ext. Project

From Mahmood Kot to Sheikupura near Lahore Via Faisalabad

1997

Commissioning of PARCO Mid Country Refinery (MCR) with a4.5 MT/ p.a capacity

2000-2001

Launching of Marketing Operations of PEARL in partnershipwith SHV & OMV and incorporation of a Joint Venture Co. withTOTAL Fina Elf for development of retail outlets.

2000-2001

Under current implementation: White Oil Pipeline Project(WOPP)

2002

Annexure 2

GROWTH AND PERFORMANCE

The following is an overview of our major milestones:

Year Milestone

1990 Debottlenecking of Keamari Facilities (DKF) Project. Additional 50,000 tons of storage facility atKorangi & direct discharge of ships into PARCO network to ease pressure on Keamari Oil Piers.

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1992 Introduction of flow improving technology to increase pipeline installed capacity of 2.9 to over 4.0million tons/year, with flow improver.

1994 Completion of Bubak and Fazilpur pumping stations, raising pumping capacity by 50% to 6.0million tons/year.

1997 Completion and commissioning of 360 km Pipeline Extension Project MFM) from Mahmood Kot toMachhike near Sheikhupura via Faisalabad.

2000 Completion and commissioning of Mid-Country Refinery (MCR) at Mahmood Kot.

2000 Launch of Marketing Operations.

2002 Commissioning of Gantry at Faisalabad

2004 Completion of PAPCOs 780 Km White Oil Pipeline (WOP) at a cost of US$ 480 million.

2005 IMS Certification of Mid-Country Refinery

2006 Korangi-Port Qasim Link Pipeline (KPLP)

2006 Export of Motor Gasoline

2006 IMS Certification of Pipeline Division

2007 IMS Certification of Corporate Headquarters

2008 Zamzama condensate injection from PSA-2 Bubak

2009 Implementation of SAP ERP

2009 HR Transformation

Annexure 3

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Hierarchy

Annexure 4

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Annexure 5

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Annexure 6

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Annexure 7

CORE MANAGEMENT TEAM

Mr. Muhammad Rasheed Jung

Managing Director, Pak-Arab Refinery Ltd.

Mr. Muhammad Rasheed Jung has 38 years of experience in managing and operating oil refineries, petrochemicalcomplexes and pipeline systems in Pakistan as well as abroad. He has been associated with Pak-Arab Refinery Limitedsince 1989 and has played a significant role in successful completion of PARCOs various expansion projects. He was theProject Coordinator for PARCOs US$ 886 million state-of-the-art Mid-Country Refinery. Prior to joining PARCO, Mr.Jung had been working for ADNOC, PERAC and National Refinery Limited. His key areas of expertise are Engineering,Financial/Strategic Management, Corporate Affairs and Human Resource Development. He holds Masters Degree inElectrical Engineering from Germany and is a senior member of Instruments Society of America.

Mr. Tariq Rizavi

Chief Executive Officer, Pak Arab Pipeline Company Ltd.

He holds a Masters Degree in Chemical Engineering and a Postgraduate Diploma in Management. He joined PARCO as aTrainee Engineer in July 1975 and was the first engineer and possibly amongst the very first employees of PARCO.During his thirty three years association with PARCO, Mr. Rizavi has developed his career with higher and higherresponsibilities in Process Engineering, Commercial and Corporate Planning. He has also provided leadership support to

the Human Resource Development / Administration discipline.

Mr. Feroze Jehangir Cawasji

DMD Finance & Corporate Affairs

Mr. Feroze Cawasji joined PARCO in 2003 as Deputy Managing Director (Finance & Corporate Affairs), he is a memberof the Institute of Chartered Accountants of Pakistan (ICAP) and brought with him more than 20 years of rich experience,including 15 years in the oil industry. With his appointment, the company crossed another milestone on the way inachieving a strong and balanced organizational structure that is capable of sustaining its growth.

Mr. Shuja Uddin Ahmed

DMD Operations

Mr. Ahmed has around 32 years of professional experience in leading Petroleum Industry and multinational organizations;including about 30 years diversified experience in PARCO. Major areas of responsibility included Corporate & Strategic

Planning, Project Development, Projects, Mid Country Refinery Project, and Marketing & Commercial. He holds a B.Sc.Degree in Chemical Engineering and has attended several training programs and professional development courses.

Mr. Munawar A. Tejani

Company Secretary

With PARCOs continuing growth and diversification, Mr. Munawar A. Tejani joined PARCO as Company Secretary toprovide support to the Management Team. Mr. Tejani is a member of the Institute of Chartered Accountants of Pakistan(ICAP) besides holding a Bachelors degree in law. He brings with him more than 20 years experience in financial andsecretarial areas.

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Syed Zakir Hussain Shah

GM Pipelines

Mr. Zakir Hussain Shah joined PARCO in 1978 and was assigned the construction of the Karachi-Mahmoodkot pipeline.He has worked in various capacities and departments and has extensive experience in Project Implementation. He has

played a pivotal role in various PARCO projects including the White Oil Pipeline Project. His area of expertise alsoincludes Operations and Maintenance of pipelines. Mr. Zakir has a bachelors degree in Mechanical Engineering.

Mr. Anwar Ahmed

GM Special Assignments

During his 32 years association with PARCO, Mr. Anwar Ahmed has grown into more senior responsibilities within theFinance discipline. He has a Masters Degree in Economics and is also a fellow member of the Institute of CharteredAccountants of Pakistan. He joined PARCO as an accountant and since then, on the basis of his ability and hard work, has

been steadily assuming higher responsibilities.

Mr. Ahmed Nadeem Jamal

Head of Internal Audit

Mr. Jamal has been with PARCO since 2002 and currently serving as Head of Internal Audit. Having extensiveexperience with different multinationals where he was responsible for Information Technology, Finance, MaterialsManagement and Internal Audit. Mr. Nadeem Jamal is a member of the Institute of Chartered Accountants of Canada andBermuda since 1985 and an FCA member of the Institute of Chartered Accountants of Pakistan.

Mr. Abdur RashidGM Technical

Mr. Abdur Rashid has a Bachelors Degree in Mechanical Engineering and has served PARCO since 1993. During hisprofessional career of 35 years, he has worked on petroleum refinery, petrochemical plants and pipeline projects, coveringalmost all facets of project engineering leading teams involved in Mega Projects of immense importance in the EnergySector.

Mr. Shah M Saad Husain

GM Corporate Affairs

Mr. Saad has Masters degree in Engineering (USA) and Business Administration (IBA) along with 32 years ofmanagement experience in the energy and engineering sectors with multinational, private and government organizationsin Engineering, Project Management, Marketing, Business Development, HR, External Affairs, Corporate Planning,Administration, CSR and Customer Relations. Prior to joining PARCO in November 2008, he worked for about 10 yearsat Indus Motor Company, the joint venture of Toyota Motor Corporation in Pakistan, where he has held the positions of

Director Marketing, Director HR, and Director Corporate Planning & Customer Relations. Before that, he was employedas General Manager in British Petroleum and in BHP, and has also worked in PIDC as Chief Engineer.

Syed Zawar Haider

GM Marketing and Commercial

He holds a Bachelors Degree in Mechanical Engineering and MS in Engineering & Management Science from USA.Since his joining, Mr. Zawar Haider has played an important role in various marketing and commercial initiatives ofPARCO. He has brought 25 years of sound and diversified experience of working with leading multinationals in the oilindustry like Shell, Mobil, Exxon Mobil with local and overseas assignments. Mr. Haider was also seconded by PARCOto Oil Companies Advisory Committee (OCAC) as Secretary General in November 2006 where he took importantinitiatives on downstream oil industry issues.

Mr. Shahid Mahmood Khan

Head of Corporate PlanningMr. Shahid Mahmood Khan has joined PARCO as Head of Corporate Planning, in 2008. He brings with him around 30years of experience in General Management, HR, Administration, Marketing, Finance, Materials Management / SupplyChain, Government/Trade Bodies Relations, Business Development, Corporate and Strategic Planning in diversifiedsectors including Oil & Gas, Automobile and Chartered Accountancy / Consultancy. Mr. Khan is a Chartered Accountantand has attended various management courses including the advanced management program from INSEAD, France.

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Mr. Attaullah

GM Refinery

Mr. Attaullah did his B.Sc. Engineering in Mechanical in 1975 from the University of Engineering and Technology,Lahore and MBA from Bahauddin Zakaria University, Multan. Later he did a Diploma in Planning and ResourceManagement from Colorado State University. In 1985, he completed his Masters in Engineering Economics from thesame university. Mr. Attaullah joined PARCO in May 1998 as Chief Engineer and remained actively involved in the

construction, commi ssioning, start-up and later in Maintenance and Materials Management of Mid-Country Refinery.He became Manager in January 2000 and has worked in Utilities and Oil Movement, and Maintenance Departments,

before becoming DGM (Refining).

565 -OBassignment No2

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