Presented by :-Presented by :-

Muhammad Badar Uz ZamanMuhammad Badar Uz ZamanMusa AliMusa Ali

“Change Management at PSO”

ContentsContents

• Company profile• Competiveness & Overcoming Obstacles• Problem Identification• Purpose of Change• Resistance to Change• Change specialist• Change Strategy• Summery of results achieved• Conclusions

Company profile

Founded in 01st January 1974. Merger of PNO (Pakistan National Oil) , DPL (Dawood Petroleum

Limited) as POCL (Premier Oil Company Limited). Renamed as PSO in 30th December 1974. Largest Oil marketing company in Pakistan. Products- Oil, Natural gas, Petrochemicals Total Staff 1952 (2007) Financial facts

◦ Revenue PKR 349.7 Billion (2007) ▲◦ Net income PKR 4.7 Billion (2007)▲

Location, Head Office Karachi, Clifton Competitors◦ Shell Pakistan

◦ Caltex

Overcoming Obstacles

Rising Oil Prices in the international market.

As alternative to fuel, Pakistan State Oil is developing Ethanol.

Pakistan State Oil is creating customer friendly environment at its petrol pumps contracts with Banks, Fast Foods and Shopping Stores e.t.c.

Pakistan State Oil is developing environment friendly products which emit less smoke.

Problem Identification

Pakistan State Oil was loosing its market share, the overall performance of the company in the year 2000s had been sliding downwards.

Internally it had no sound business model to undertake short and long term business planning supported by proper capital budgeting system.

Quality of its products was continuously declining and Shell earned a big name in quality in the market.

Purpose of change

• As Pakistan State Oil was loosing its market share which was deteriorating its profitability so the change was inevitable in order to increase the profitability.

• To increase the efficiency of the employees.

• Old as well as new employees feel dedicated towards the work.

• Quality and Product.

Resistance to change

During the change phase, the management had to face many risks and difficulties as under,

•Middle managers were totally opposite to it according to them, the old approach of the company was based on historical budget lines and box thinking.

•The attitude of the senior corporate citizens was that “Since we have always done our work like this, we still continue this way. “According to old employees this attitude, betrayed a lack of sensitivity to market and industry dynamics.

•Against this backdrop of organizational depression, any talk of change created negative vibrations amongst the old employees.

Company Change Specialist

The change in Pakistan State Oil was brought by Tariq Kirmani.

Mr. Tariq Kirmani is known as Management turnaround specialist and has to his credit many turnaround projects.

After obtaining his Masters in Business Administration Tariq joined Caltex an Oil company in 1996 which he served for more than two decade.

Upon his expertise in oil marketing and management, the Government of Pakistan appointed him in April 1999 as deputy managing director of Pakistan State Oil.

Subsequently taking over as the Managing Director in July 2001, Mr. Tariq Kirmani repositioned P.S.O as a dynamically customer focused, vibrant and a profitable company.

Change Strategy

• Concept of equality

• Ways of Communicating Change

• Help employees to make the change

• Step by Step approach• Leadership• Social Responsibilities• Check and balance of employee’s performance & attendance• Quality of products

Summery of results achieved

• The new policy of change led to creation of many young and energetic employees who could work more actively by using new technology and machinery.

• Due to proper technique of check and balance on attendance system of employees, Pakistan State Oil got very positive results. The productivity level per employee went up. The hand scan system changed the employee's attitude towards the work, they became regular and worked hard to achieve the productivity standards.

• It was because of change that Pakistan State Oil created quality testing units which ensured the quality of the products.

Conclusions

Pakistan State Oil has earned a big oil marketing company but due to certain reasons, the manager of the company brought some changes in it. As we have seen that these changes proved very fruitful in the way to development and increasing the market share and profitability of the company so one can say that the turn around strategy of Pakistan State Oil was very effective.

This strategy was implemented effectively and positive results were achieved. Every strategy has its pros and cons but ignoring the weaknesses the overall strategy was a success for Pakistan State Oil.

Major successful impact of change as under,◦ Revenue (1.4 trillion PKR) (2014)

◦ Profit (21.8 billion PKR) (2014)

◦ Total equity 100 billion PKR (2014)

◦ Employees 3,000

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