Organization Development

EXECUTIVE SUMMARY

Pakistan Railways (PR) is the state owned railway company of Pakistan. It is a large organization under the administration of Ministry of Railways. Pakistan Railways provides an important mode of transportation in the farthest corners of the country and brings them closer for business, sightseeing, pilgrimage and education. Its Current Chairman is Raja Shahid Hussain. Pakistan Railways has been facing problems and is now on the verge of bankruptcy with budget deficit of billions, eroding market share and corruption scandals. At the time of independence, both India and Pakistan, inherited the Railway Network laid down by British. While Indian Railways has emerged as a highly profitable organization, Pakistan Railways is struggling to keep itself running. This report summarizes how organization development can help Pakistan Railways revamp its image and goodwill. It is based on facts and hypothetical situations created by the group members to evaluate the applicability of OD interventions. The data is collected from various sources including books, newspaper articles and internet. The report provides introduction of Pakistan Railways, its history, organizational structure which is then followed by how the concepts of entering and contracting can be applied to this case. Diagnosis of the organization has been done with the help of data collected and hypothetical situations. Based on the diagnosis, OD interventions have been suggested for Pakistan railways which include techno-structural interventions.

Introduction of PAKISTAN RAILWAYS Pakistan Railways (reporting mark PR) is a national state-owned rail transport service of Pakistan, head-quartered in Lahore. It is administered by the federal government under the Ministry of Railways. PR provides an important mode of transportation throughout Pakistan. It is commonly referred to as the "life line of the country", by aiding in large-scale movement of people and freight throughout Pakistan. (pakistan railway)

Organizational Structure

Ministry of Railway is responsible for overall control of Pakistan Railways as well as to guide the overall policy. There are four (4) Directorates in this PR namely Administrative Directorate, Technical Directorate, Planning Directorate, and Finance Directorate. (ministry_of_pakistan railway)The following officers also report directly to the Secretary Railways:-a. General Manager (Operations)b. General Manager/Manufacture and Servicesc. Federal Government Inspector of RailwaysPakistan Railways at this time is a vertically integrated organization and has four business units:1. Infrastructure Business Unit 2. Passenger Business Unit 3. Freight Business Unit 4. Manufacturing and Services Unit

Structural DesignPakistan Railways is a vertically integrated highly bureaucratic organization. The current organizational structure is a mixture of functional and divisional structures. The positions are divided into four classes:-Officer Cadre-Station Masters-Running Staff-Class Four comprises of labors, signal operators etc. The structure needs to be revamped into a more leaner and flexible one. A combination of divisional and network structure will be most appropriate for Pakistan railways. The PR management can retain the structure based on current divisions and create a network of these divisions for better management of operations and resources. (ministry_of_pakistan railway)

Human Resource Pakistan Railways is the largest civil employer in the country and has about 90,000 employees consisting of staff and officers as of 2008). 71% of the total employees are working in Civil, Mechanical and Transportation departments. All the hierarchy positions are held by graduate Engineers. (pakistan railway)Condition of Employees: Pakistan Railways has about 90,000 employees consisting of staff and officers as of 2008 which is more than required. Employees are taking salaries without working and sitting idle at home. More than Rs.20 billion is allocated for salaries and pensions. Employees have very strong unions so it is difficult for Government to fire them.(dawn.com, 2013)

SWOT ANALYSISStrengths Potential customers Human resource MonopolyWeaknesses Leadership Wastage of time Over emplacement

Opportunities Demanding customers Al ready setup tracks Low cost Threats Uncontrolled loses Expenditures are high Customer move to alternate options

PROBLEMS FACED BY PAKISTAN RAILWAYSThere are five major problems Pakistan Railways is facing: Shortage of advanced locomotives Huge Losses & Budget Deficit Mismanagement Decreased Market Share Corruption. (dawn.com, 2013)Shortage of Locomotives:The Pakistan Railways has a total of 546 locomotives but only 290 are on track while the rest are out of order. Similarly, 70 per cent carriages are out of service. In a report submitted to Railway Ministry, it has been disclosed that as many as 70 locomotives are awaiting spares at Pakistan Locomotive Factory, Risalpur since 2004. (pakistan railway problem, 2010)Huge Losses & Budget DeficitThe reason for this loss is the presence of unnecessary departments which are white elephant for Pakistan Railways. The biggest among those is the Railways Police that takes over Rs 1.5 billion including emoluments and other facilities followed by Stores and Purchase. These departments should be abolished from Railways without further delay. Their utility for railways is marginal at best. The Audit and Accounts, Railways Workshops Division, and General Administration staff need drastic cuts. These organizations are heavily overstaffed. If they will continue to ignore the presence of non-productive over staffed departments with very insignificant contribution in overall performance of Pakistan Railways, the department will continue to decline. It shall never be in a position to meet the expectations of public.Railways are operating at low rates. A flexible policy for rates and fare requires to be adopted whereby freight rates could be varied according to the type of commodities as well as direction. (pakistan railway problem, 2010)Mismanagement Currently Pakistan Railways is facing acute shortage of locomotives and spare parts for maintenance of out of service locomotives. Since independence little has been done to expand the railway network in Pakistan. As per the reports compiled by the design team, Pakistan Railways need 40 50 locomotives annually to run its operations effectively. However, during the past two decades only 100 locomotives have been added. The management of PR has failed to generate revenues through use of assets like land, locomotive factory, carriage factory etc. The focus of Railway officials is on getting new locomotives while ignoring the improvement in operations and maintenance of existing locomotives. The plans to change broad gauge into standard gauge at this stage are not just costly but also unnecessary. (pakistan railway problem, 2010)

Decreased Market ShareOver the years, Pakistan Railways could not maintain its share in the countrys transport sector. With Railway ministry shutting down operations of various trains, it is no wonder that the market share of Pakistan Railways in cargo transport has fall to mere 5% from 75% in 1960s and 1970s. Around the world, railways are the cheapest and safest mode of transport and majority of goods transport is carried out via railways. However, in Pakistan the situation is completely different. The indifferent attitude of various governments, direct competition from NLC, container mafia and bus mafia are all behind the drastic condition of Pakistan Railways today. Railways and NLC need to coordinate their operation and also compete in their operations to economize on the inter modal movement of goods traffic. The Railway should carry goods in bulk in the plains, while NLC and private road transport should take over further distribution from these points in to the hilly regions. This will help the railway to concentrate its resources of locomotives and wagons on the main line in the plains, after withdrawing them from the hilly regions. This is in fact the best and most economical rail road mix for the country. (pakistan railway problem, 2010)CorruptionCorruption is the biggest problem Pakistan Railways is facing today. The Railway Department has been suffering losses since years long. Contractor system is one of the causes of such losses. Moreover, there are enormous irregularities in local purchases. The number of officers cadre has increased considerably since 1977, mostly due to political appointments. It has been revealed that the crises are self-generated creating a space for more corruption and PRACS-Pakistan Railways Advisory Commute Services is responsible for this mess.Selective services have been privatized by allotting its contract to different private parties to operate those privatized trains. Ironically the contract has been awarded only for ticketing and like buss conductors those private firms after selling out the ticket deposits payments into the Railways account. As per agreement after deducting its commission the contractors are legally bound to deposit the funds into the Railway account but due to the nexuses between Railways bosses and private contractors deposit the funds in private accounts. In short Pakistan Railways is a classic example of bad governance, poor policies, corruption and mismanagement. (pakistan railway problem, 2010)

In the light of above problems the Railway Board decided to hire external OD consultants to design interventions that can help in turning around the organization into a successful reform change.ENTERING & CONTRACTINGFirst External OD practitioner has been approached by the Railway Board to help Pakistan Railway and solve the problem of this organization. As OD consultants for Pakistan Railways, the first task for us is to understand the current structure and the issues of this organization. A meeting with the Chairman of Pakistan Railways, Raja Shahid Hussain and other members of Railway Board was conducted to discuss the organizations issues like huge financial losses, Decreased market share, inefficient operations and Corruption.

Key ClientsIn case of Pakistan Railways, our main client is the Railway Board. Other important key clients include GM Railways, Addl. GM of each business unit, and representatives from Railway Employees Union, Railway Workshop Workers Union, and Association of Station Masters etc.

OD ProcessTo clearly identify the problems faced by Pakistan Railways, we recommend the OD process with following key steps:Selecting a design team: A team of 8-10 individuals will be selected which will include key policy makers for Pakistan Railways, representatives from various functional areas of the organization and workers unions.Diagnosing: Once the team is selected a joint diagnosis of the organization will be conducted which will include understanding organizations current strength and weaknesses, growth opportunities, organization culture and values etc.Action Planning: The first key output of the team is a 5 year action plan that describes where Pakistan Railway should move to, key activities and milestones, assigned responsibilities for those activities, and assumptions that need to be monitored.Implementation, Monitoring & Evaluation: As the plan is implemented, new information, changes in the environment and other issues always arise that need adjustment. In this phase the OD consultants along with the design team will monitor the implementations and collect feedback to evaluate whether action plan is on track or not and will fix any deviations. Also design team will conduct formal evaluation processes and discuss their learning about organization structure and change.

Time & ResourcesAs OD consultants, we will provide consultancy services up to and including development of action plan. Additional time beyond that time can be contracted. Apart from the consultancy fee Pakistan Railways will also be responsible for all the direct expenses for the research. The complete process including diagnosis and development of action plan might take six to eight months subject to:-Access to key information and people.-Commitment from PR( Pakistan railway) management.-Access to sensitive information like HR records, PR policies, PR contracts etc.-Prompt response/feedback from key clients. (pakistan railway-the life line of the country)

DIAGNOSIS OF PAKISTAN RAILWAYSModels represent the simplifications of reality and therefore choose certain features as critical conditions existing in Pakistan Railway organization these models helps to create a clear image of Railway organization. We are refer basically three main models which represent the Railway Organization structure, current strength and weaknesses, growth opportunities, organization culture and values and work environment of the Railway.Diagnostic ModelEvery organization based on Open System Theory

Inputs consist of human resources such as information, energy and materials coming into the system. Inputs are required from the systems external environment. Transformation processes of converting inputs to outputs and finally output are the results of what is transformed by the system and sent to the environment affectively. We are selecting the model of Burke-Litwin Causal Model. This model has motive that how to move intentionally to a desirable state and make the dynamic organization for create an effective image in the eyes of the society.

Current Affairs of Railway:Today almost all government corporations of Pakistan are in worst shape but Pakistan Railways is in really bad condition and costing country huge loses every month. For more than a century the railroad was the dominant form of land transportation in much of the world. It was, and still remains the economic backbone of a country. Pakistan Railway faces various problems some are as follows: Mismanagement Corruption Shortage of advanced locomotives Lack of technique-oriented staff Downsizing

The Burke-Litwin Causal Model

External Environment affects on Railway: Huge financial losses Decreased market share Expenditures are high.

Main features to diagnose Railway Organization:

First constantly diagnose the whole structure, work environment of Pakistan Railway Organization. Second what technology should be used, how to use and what further technology should be installed for further innovation in internal environment. Each employee/people/Actors must know about their task, what and how to perform in odor to provide productive output. Each and single activity makes affects on other activities which are functioning in a work setting so we have responsibility as a OD consult to focus each factor for creating a new change and through diagnose identify the main problem or lacking for maintain the long lasting change.

Model Analysis:

The main problems existing in all over Railway organization which we were diagnose are that employees motivational level are the main theme of these whole scenario which affects the factor of performance. All factors are the interrelated with each other if Pakistan Railway setup their mission, goals and strategy clearly that what they want and how we achieve desired goal and what they want to get from employees performance. The leader plays a dynamic role to boost the organization from bottom to up leaders should know about mission and strategy, culture, system and management practices because leader is only a person who guide and lead the way to employees that how and what to perform efficiently. Each and every individual have some needs and values before assigning any task leader or management should develop the reward system for motivating and appreciating the employees to perform outstanding and provide various productive outputs to the organization. If the employees are satisfied with their jobs they automatically give outstanding performance on their job and they start utilizing their abilities and skills in a right way rather than other activities. Employees performance be productive through motivational level increases than employees will become more productive. If employees performance are satisfied automatically the image of Pakistan Railway services in the society will be become good and make the best images in the eyes of the Pakistans economy as well as Railway customer. Employees are the assets of the organization employees are only main actors who act according to their values, needs and satisfaction on individual basis thats its the responsibility of management or leaders to focus those motivational factors that how employees will be motivated and perform outstanding on the job. This model creates the image that all factors have strongly affects on performance thats why as a consultant we totally focus on performance of employees that how reward system should be develop by the organization in odor to satisfied intrinsic and extrinsic values of individual.

FEEDBACK:Feedback is the outcome of diagnosis. For the desired result several meetings needs to be conducted with clients to determine the required OD intervention for Pakistan Railway. To resolve the current crises it is necessary that consultant and clients may agree on a joined venture.If positive energy created between employees and valid information transfer to the right person at the right place, bring transformational change from lower to high level results the desired outcome.TECHNOLOGICAL CHANGE: However through proper use of technology in different areas like computerized seat reservations, proper trains schedule, up to date customer care service, time management, check and balance, track management etc can bring positive output. Services should be providing on online system to customers and internal environment setting as well.PRIVATIZATION:Pakistan Railway can privatize some of its manufacturing units, locomotive factory, carriage factory so that through proper management all units work properly and level of corruption reduces. In Privatization Company they are maintain proper check and balance on employees, focus and evaluate the job performance as well that how they provide productive output to the Railway organization. Some departments if becomes privatize it is beneficial for Railway and environment as well and create an outstanding image in the eyes of the customers through performance of organization.

EMPLOYEES:If employees of Pakistan Railway are provided with benefits, incentives and their level of motivation is high they will get satisfy from their organization. Each and every employee should perform his duty which is assign to him according to his post. Pakistan Railway should adapt the structural change which will help in eliminating unskilled and non productive staff through audits, layoff and buyoff packages. Pakistan Railway should develop the compensation plan for employees to motivate their performance level and satisfied their all basic needs and want. Compensation plan for employees should be like that:

ACTION PLANNINGAfter a careful diagnosis, the results were feedback to the main clients. Several meetings were conducted with key clients to determine the type of OD interventions that will most appropriately suit the needs of Pakistan Railways. The clients and consultants jointly agree that Pakistan Railways need a mixture of techno-structural and human resource management interventions to recover from the current crisis.

INTERVENTIONS FOR PAKISTAN RAILWAY:INTERVENTIONS:To improve productivity of Pakistan Railway, we as an OD consultant can do techno structural interventions and human resource management interventions. We are selecting these interventions because we observe that by doing technical interventions and human resource interventions we able to bring new technology in PR and we recruit and select only skilled and job match candidates first and then we would continuously observe their performance and talent level and would given financial and non financial rewards to motivate their performance level and increase their production level. And involve them as much as possible in decision making and empowered them for employee involvement and committed them in organization.TECHNOSTRUCTURAL INTERVENTIONS:1- STRUCTURAL DESIGN: The structure needs to be revamped into a more leaner and flexible one. A combination of divisional and network structure will be most appropriate for Pakistan railways. The PR management can retain the structure based on current divisions and create a network of these divisions for better management of operations and resources.2- Restructuring OrganizationsWe are focusing upon how to divide the overall work into subunits and how to co-ordinate these subunits for task completion. By this we are capable to set our mission and vision more clearly and also make aware of this transparent knowledge to our clients and members of the organization.3- REENGINEERINGPakistan Railways have great potential for growth. Pakistan Railways can improve the performance of its various functions and department through proper use of information technology. The areas where information technology can play a vital role include: Seat Reservations Freight Management Asset Management Track Management Electric Billing TimetablePakistan Railways should be privatizing some of its units like The Locomotive Factory, The Carriage Factory and other large manufacturing units. Only privatization of this sector is the solution of problem because currently government of Pakistan has to bear the huge losses monthly.4- DOWNSIZINGThe Pakistan Railways is an over staffed organization. Political appointments over the years have added to the problem and are the major reason behind organizations financial troubles. Departments like Railway Police, Stores & Purchase need to be abolished.

5- EMPLOYEE INVOLVEMENT AND COMMITMENTBy involving employee to our organization we are capable to bring successful interventions and low resistance from organization. We have to increase their commitment by information, knowledge and skills, sharing of decision power with the union and its members and rewards are manipulated to increase employee participation and empowerment in organizations. It increases focus on the improvement of organizational processes and customer satisfaction.

Human Resources Management Interventions:1- Goal Setting By setting goals for all members of organization we would able to do more productive work in Pakistan railway. Employees should be goal directed towards organization mission and vision.

2- Performance Appraisal and Reward SystemsLine managers should compare their subordinates actual performance to the standards that have been set. They should set appropriate task for all their subordinates like: Role requirements (Expected outputs and outcomes), Objectives in the form of targets and standards of performance, Performance measures and indicators, Knowledge, skill and competency, Corporate core values or requirements, performance development plan and continuously monitor their performance, skill and mental level and give feedback and appraise them to bring better commitment of employees towards organizations goal and set rewards for them (intrinsic and extrinsic rewards).

3- Career Planning and DevelopmentManagement should pay attention for their employees career planning and development opportunity to satisfy them and retain best employees in organization. Management should arrange workshops, seminars, on-the job and of-the job training programs and job rotation to satisfy all employees and managers to retain in Pakistan railway.

4-Managing Work Force Diversity and Employee WellnessWe should consider organization basic culture and the working condition which best suits for them and eliminate gender difference and biasness among employees and make good compensation plan for employees.

All in all, we would first have to recruit best job match and skilled candidates and downsize all corrupt and old age employees who dont have ability to learn something new and do high resistance to change. We would bring technology to our organization and train all employees. We would do gradually reform change and guide all our stakeholders and make them with us to reduce resistance level. We would make our information transparent for our employees and make them highly involve in decision making and provide them chance for giving suggestions and give new ideas for successful interventions to make them feel like that they owned this interventions and feel part of the organization.

RESISTANCE: Pakistan Railways staff faced severe resistance in the initial phases of privatization and deregulation. The media aligned with big capital in its assault on workers rights and credibility. Then there is the age-old colonial and bureaucratic mindset, which has always said that the workers never work. The political parties have attributed labor wings towards the Pakistan railways. This influx has definitely impacted the unity of railway workers and has historically tried to undermine the just fight of the unions. This is because every party has its own agenda and these wings work according to those agendas. If the Pakistan railway privatized than the private party will be responsible to bring substantive changes to value adding in the service to be provided to passengers, Pakistan Railways would provide locomotives and coaches with the standard fitting and amenities. Pakistan Railways had to bear the expenses of Pakistan Railway Police (PRP) from its own budget and resources.Conclusion Pakistan Railways have great potential for growth. . Pakistan Railways can improve the performance of its various functions and department through proper use of information technology. Pakistan Railways should be privatized because this is one solution of problem because currently government of Pakistan has to bear the huge losses monthly. Pakistan railway have some financial problems due to over staff. Its should be mange according to their needs of employee. Pakistan Railways can create networks to operate some of its route for privatized trains. So, to solve these problems as the OD consultant we use techno structural interventions and human resource management interventions. so with these interventions many problems are solved in PR. implement on these intervention. once the change have been made then can be made Organization Development & Change

Recommendations Firstly employee needs motivation level increases then employees will become more productive. TheRailservicesshouldbeimprovedandmustbe providedto the Passengerin time. TheHRdepartmentofthePakistanRailwaysisnot playing an effective role. Proper arrangement should be madeforprofessionalsbyissuingdetailedjob description and job specification to get maximum profit from them. The salariesofthe employees shouldbe reasonable. To restructure and modernized Pakistan railway under the present administration. The present situation of Pakistan railway may not change unless corrupt high ups are removed, suspended and dismissed from the services. Pakistan Railway should develop the compensation plan for employees to motivate their performance level. Focus and enhance the productivity of organization and expand their abilities in to a sustainable and productive market in an ethical manner.

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1 Submitted TO: Miss Ambreen Sualeh