TERM REPORT

TOPIC
EMPLOYEE MOTIVATION

GROUP MEMBERS
SEHRISH MANSOOR
SHAMSUNISA MIRZA
NOMAN NOORULLAH
SARA MOHIUDDIN
MARIAM TAMEEZUDDIN

DATED
DECEMBER 06, 2010

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ACKNOWLEDGEMENTS

Our group would like to acknowledge Mr. Rizwan, Head of Training Department for his
extensive support and cooperation for making this report. He further sent us to Mr. Zulfiqar Ali
Jafferi, General Manger Consumer Behavior, who facilitated us and provided us with sufficient
information and insights about the motivation practices that take place currently at PSO. Our
visits to PSO have been very knowledgeable and fruitful. We would also like to thank Ms.
Shagufta Rafif for giving us, students a chance to visit the organization and getting to know
about the organizational setup. As students of Organizational Behavior this report has broaden
our understanding of the subject and has allowed us to experience the theory in practical
applications

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 LETTER OF ACKNOWLEDGEMENT

Dear Reader,

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

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

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

Regards,

SEHRISH MANSOOR

SHAMSUNISA MIRZA KHAN

NOMAN NOORULLAH

MARIAM

SARA

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 LETTER OF TRANSMITTAL

DECEMBER 10th, 2010

Ms. Shagufta Rafif

Course Instructor
Organizational Behavior
Institute of Business Management
Korangi Creek,
Karachi.

Dear Ms. Shagufta,

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

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

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

Yours Sincerely,

SEHRISH MANSOOR

SHAMSUNIASA MIRZA KHAN

NOMAN NOORULLAH

MARIAM

SARA

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CONTENTS

Table of contents

1. Executive summary…………………………………………………………………………………(6)
2. Methodology…………….. ………………………………………………………………………....(7)
3. Mission and the Vision of the organ…………………………………………………………..(8)
4. Introduction and History of PSO………………………………………………..…………..(9-10)
5. SWOT Analysis……………………………………………………………………………………...(11-12)
6. Motivational Practices Used in PSO ………………………………………………………(13-18)
7. Employee Recognition Program Used in PSO ……………………………………….(19-23)
8. Flexible benefit programs adopted by PSO……………………………………………(24-29)
a) Allowing employees it build their future
b) Designing flexible benefits
c) Employee health and well being
d) Total reward
9. Conclusion………………………………………………………………………………………..…..(30)

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EXECUTIVE SUMMARY

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

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

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

The organization’s productivity is improved by creating a learning environment throughout the

year so that employees get motivated to update or improve their present skills, the employees
remain satisfied with their job at PSO because they are encourage to communicate freely with
their inline manager and can switch to different departments according to their abilities.

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

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

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METHODOLOGY

This research was conducted on the Pakistan State Oil to find out the position of motivation
practices taking place in the local arena. Both the secondary and primary data was used to attain
this objective. The literature review was made by incorporating the knowledge from certain
published articles pertaining to the topic. Also the book and lectures related to the course of
organizational behavior were used to make the questionnaire and interview.
The primary data includes the research conducted on the company itself. Interview was
conducted from the expert. The data was finally compiled and evaluated with the help of the
prior knowledge as well as the information gathered from the company.

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Mission

We are committed to leadership in energy market through competitive advantage in providing

the highest quality petroleum products and services to our customers, based on:

 Professionally trained, high quality, motivated workforce, working as

a team in an environment, which recognizes and rewards
performance, innovation and creativity, and provides for personal
growth and development
 Lowest cost operations and assured access to long-term and cost
effective supply sources
 Sustained growth in earnings in real terms
 Highly ethical, safe environment friendly and socially responsible
business practices

Vision

To excel in delivering value to customers as an innovative and dynamic energy

company that gets to the future first.

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Introduction:

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

economic forum. PSO has established around 3700 retail outlets across the
country including 1459 new vision outlets commissioned within seven years.

PSO is leading national company committed to support an ongoing innovative

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

PSO has been meeting the country's fuel needs by merging sound business
sense with national obligation. In order to satisfy the customers' needs while
ensuring the highest quality of products and services, PSO has introduced total
quality management system in its operational activities.
Only Pakistani corporation to become member of the World Economic Forum
based on stringent and forward looking criteria. Only company in Pakistan
whose turnaround and remarkable performance is cited in various case studies
both locally and internationally. Around 3,800 retail outlets across the country
including 1,000 New Vision outlets commissioned within five years.

PSO is considered as a blue chip organization in stock exchange. It is fulfilling

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

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

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

In order to motivate their employees, PSO provides incentives by giving

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

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

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

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

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SWOT Analysis

Strengths:

 Well Established Infrastructure

One of the most powerful strengths of PSO is that it has a well established
infrastructure around 23 depots have been established from south to north. Also it has the
largest retail network and it is the biggest supplier of IPPs/ Hubco

 Good market share in stock exchange

In stock exchange PSO is a blue chip organization with a market capitalization of
around 53 billions.

 Latest Technology
Pso is equipped with latest equipments and specialized in latest technology such as:
Laser coding on lubricants, car wash plants, usage of tracking system to avoid theft and
leakage of lubricants.

Weaknesses:

 Improper Control
Since it is the largest supplier of fuel within our country it is facing the problem of
quality control for that reason they are using quality control mobile facilities.

 Lack of supply sources

Oil is supplied to the retail outlets through tank lorry and railway wagons from depots
which tend to take a lot of time to make the product available and is costly.

Opportunities:

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

 Modification
PSO is working on to launch LPG in the retail outlets as they have done in the case of
CNG. For this reason they have set ten cars with LPG kits and are testing its
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consumption as well as its efficiency.