PAKISTAN

STATE OIL
SUBMITTED TO : MISS HUMERA

SUMMITED BY : HAFSA NASIR, NIMRA

AKHTER ,TOOBA BATOOL AMRAH MASOOD
 INTRODUCTION
Pakistan State Oil is a Karachi-based Pakistani state-
owned multinational petroleum corporation involved in marketing and distribution
of petroleum products. It has a network of 3,689 filling stations, out of which 3,500
outlets serve the retail sector and 189 outlets serve bulk customers.
It controls a market share of over 60% of the total oil market with customer
portfolio including dealers, government agencies, autonomous bodies, independent
power projects and other corporate customers. It is involved in import, storage,
distribution and marketing of a range of petroleum products including gasoline,
diesel, fuel oil, jet fuel, LPG, CNG and petrochemicals.
It was founded on December 30, 1976, after Pakistan's government took over the
management of Pakistan National Oil (PNO) and Dawood Petroleum Limited and
renamed into POCL (Premier Oil Company Limited) under marketing of
Petroleum Products. PSO is the first public company in Pakistan to pass the PKR 1
trillion revenue mark.
Its primary listing is on the Karachi Stock Exchange and it is a constituent of
the KSE-30 Index. PSO has been named among the Forbes Global
2000 continuously over the years. Its revenues in 2014 stood at PKR 1,410 billion
($ 14 billion) and after-tax profit stood at PKR 21.8 billion ($210 million). The
company's market capitalization is greater than PKR 100 billions

BACKGROUND :
MINISTRY AND GOVERNMENT
Pakistan state oil is under Ministry of Petroleum & Natural Resources, is
a Pakistan Government's federal and executive level ministry responsible
to ensure availability and security of sustainable supply of oil and gas for
economic development and strategic requirements of Pakistan and to
coordinate development of natural resources of energy and minerals. The
Ministry of Petroleum & Natural Resources is currently headed by Shahid
Khaqan Abbasi
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 PSOs 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 companys
major operations into independent activities supported by legal, financial,
informative and other services. Inorder 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
companys agenda under this corporate reform.

It is due to this effective implementation of corporate reform and consistent

application of the best industrial practices and business development strategies,
that PSO has been able to maintain its market leadership in a highly competitive
business environment.

January 1, 1974

The federal government took over the management of PNO (Pakistan National
Oil) and DPL (Dawood Petroleum Limited), renamed into POCL (Premier Oil
Company Limited) under marketing of Petroleum Products (Federal Control Act,
1974)
June 6, 1974

The government incorporates Petroleum Storage Development Corporation

PSDC

August 23, 1976

PSCDC renamed to State Oil Company Limited (SOCL)

September 15, 1976
The Governement purchases ESSO undertakings, vests their control in SOCL
December 30, 1976
The Government merges PNO and POCL into SOCL (State Oil Company Limited)
and renames it Pakistan State Oil Company Limited (PSO)
1999
The new vision program is launched with the new logo of PSO

Native name

Type Public

Traded as KSE: PSO

Industry Oil and gas

Founded January 1, 1974;

30 December 1976 (as PSO)

Headquarters Karachi, Pakistan

Area served Pakistan

Key people Imran ul Haque

(Managing Director and CEO)

Mujahid Eshai
 (Chairman)

Products Motor gasoline (Mogas), high-speed Diesel

(HSD), furnace oil (FO), jet fuel (JP-1),
kerosene, CNG, petrochemicals and
lubricants

Revenue U.S. $14 billion (1.4 trillion PKR) (2014)

Operating U.S. $408 million (42.0 billion PKR)

income (2014)

Profit U.S. $212 million (21.8 billion PKR)

(2014)

Total equity ~ 100 billion PKR (2014)

No. employees ~ 3,000

FINANCIAL PERFORMANCE
During the period under review, the Company has reported a Profit after Tax of Rs
4.6 billion (9MFY15: Rs 3.2 billion). The increase is mainly due to growth in sales
volume and margins of White Oil products revised in November 1, 2014 and
reduction in Operating and Finance cost by 10% and 42% respectively. However,
the said increase was partially offset by decrease in Black Oil margins due to
reduced price impact of black oil. The Companys profitability was also adversely
affected by significant inventory losses due to dip in Oil price and the need to
maintain inventory levels as a responsible company to prevent dry out situation in
the country. The Regulators need to ensure that OMCs supply product as per their
market share on a consistent basis throughout the month. The outstanding
receivables of Rs 224 billion (June 30, 2015: Rs 230 billion) from the power sector,
PIA and SNGPL against supplies of FO, Aviation Fuels and Liquefied Natural Gas
(LNG) will be a challenge as international oil price increases. The Management
continues to work closely with Ministry of Water & Power and PIA for timely
realization of due payments against uninterrupted fuel supplies to support the
power sector and airline operations
STRATEGIC MANAGEMENT

VISION
To excel in delivering value to customers as an innovative and dynamic energy
company that gets to the future first.
MISSION
We are committed to leadership in energy market through competitive advantage
in providing the highest quality petroleum products and services to our customers,

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.

VALUES

Excellence: We believe that excellence in our core activities emerges from a

passion for satisfying our customers' needs in terms of total quality
management. Our foremost goal is to retain our corporate leadership.

Cohesiveness: We endeavor to achieve higher collective and individual goals

through team. This is inculcated in the organization through effective
communication.

Respect: We are an Equal Opportunity Employer attracting and recruiting the

finest people from around the country. We value contribution of individuals
and teams. Individual contributions are recognized through our reward and
recognition program.

Integrity: We uphold our values and Business Ethics principles in every action
and decision. Professional and personal honesty, dedication and commitment
are the landmarks of our success. Open and transparent business practices are
 based on ethical values and respect for employees, communities and the
environment.

Innovation: We are committed to continuous improvement, both in New

Product and Processes as well as those existing already. We encourage Creative
Ideas from all stakeholders.

Corporate Responsibility: We promote Health, Safety and Environment

culture both internally and externally. We emphasize on Community
Development and aspire to make society a better place to live.

STRATEGIC OBJECTIVES
Compliance with regulatory and legal requirements and assure ethical
operations in all spheres of business
Focus on HR capital skill development and increased employee engagement
for an effective and motivated entrepreneurial team
Optimize and ensure efficient supply chain and pursue long term supply
arrangements.
Effective HSE compliance with steps taken to encourage use of fuels that
reduce carbon footprint.
Increase market leadership and strategize measures to improve the bottom
line.
Continue to create upstream synergy and evaluate diversification
opportunities for growth.
Focus on responsible corporate citizenship with active CSR initiatives in health,
education, community development and support for special persons.

MANAGEMENT OBJECTIVES & STRATEGIES

The overarching objective of PSOs management is to retain leadership
position in the oil market and establish PSO as a brand of choice for customers.
Ensuring compliance with legal and regulatory framework and HSE codes and
standards in all spheres of operations and playing an e-ective role in society as a
responsible corporate citizen form major objectives.
The strategies to achieve these objectives are diversied in accordance with
PSOs wide range of products and services portfolio. These strategies include
modernization and augmentation of customer outlets network and related
facilities, undertaking of PSOs customer services initiatives and brand promotion
campaigns, reinforcement of operational infrastructure including storage and
pipelines and developing and implementing technological development programs,
and ensuring highly ethical environment friendly and safe business practices.

CORPORATE PLANNING:
PSO is striving to add value to its business by introducing modern efficient and
innovative business practices to boost corporate performance. Benefits of this
value will be given to shareholders and the employees of the company. Corporate
planning is about competitive advantage; at this most challenging juncture in
PSOs history the focus is on forward thinking of on cutting edge issues. Staffed
with professionals having a diverse background in business engineering and
computer technology and international experience CP is endeavoring to prepare
PSO for the challenges ahead to ensure its sustainable corporate leadership in
future based on the best industrial practices. The development of a financial
model that resulted in the companys first in depth study on product wise and
business wise profitability as well as the establishment of an effective procedural
framework for capital budgeting mark the first year of the corporate planning
activity in PSO. This has led to classification of authority and criterion for
investment decisions efficient project appraisal based on computer modeling and
effective monitoring of the status results of investments undertaken. These
systems have been adopted by the company for periodic review of corporate
performance through management committee meetings.

DECISION MAKING

Decision making is an important aspect of the company, which needs to be

thoroughly evaluated before making a final decision. The working of organization
depends upon top management. The decision must be in interest of organization.
PSO has following decision making style :

As PSO is sales oriented company and its has many competitors like shell,
Caltex etc. so they have to consider more alternatives after making
 decision. The managers in this condition have the ability to cope with
unique situation and make analytical decisions for long term.

In short run, the decision making are more in directive style i.e managers
made fast and logical decisions. The manager is the focal point in the
organization and he is appropriate authority to a problems arise by his
observation or reflect by someone else from the organization.

PSO ORGANIZATIONAL STURCTURE :

The apex body at PSO was a fully autonomous body constituted with full
statutory pwer under company ordinance 1984. The board was assisted by three
committees in its work : finance , audit , human resources
PSO had adopted a hybrid structure that combined functional and matrix forms.
Three executive directors were handling each of the areas: customers services, HR
,Finance. Management committee was smaller body and reviewed strategic issues
and performance. It meet on weekly basis. The Executive committee, on the
other hand, was a much larger forum created for purpose of internal
communication and also to provide executive the opportunity to express their
concern of company operations which affect its performance. This committee
also meet also meet weekly.
CHAIN OF COMMAND
It is an unbroken line of authority that extends from the upper levels of the
organization to the lowest levels and defines who reports to whom. As PSO
follows traditional objective setting decision are made totally by the top
management. The authority is given to the managers to give orders and
employees are bound to follow them. It is the responsibility of the
employees to perform those duties assigned to them.

UNITY OF COMMAND

On PSO the unity of command hoes in the following sequence:

C h a i r ma n
Managing Director
6 General Managers
6 Divisional managers
sale Executive
8-12 Sales officers
Managing Director is answerable to the Chairman. MD has 6general managers
working under him. Every G.M has 8 DMs working under him. Every DM has a
Sales executive and under him there are 8-12 sales officers.

CENTRALIZATION
PSO is a highly centralized company i.e. decision-making is concentrated in the
upper levels of the organization. The Top management makes the companys key
decisions with little or no input from the lower level employees. PSO is more
centralized because the environment is stable company is large and lower level
managers are not as capable or experienced at making decisions as upper level
managers

MECHANISTIC ORGANIZATION
PSO is a mechanistic organization with a highly controlled structure. In the
mechanistic structure work specialization creates jobs that are simple routine
and standardized. Extensive departmentalization increases impersonality and the
need for multiple layers of management to coordinate these specialized
departments. There is also a strict adherence to the unity of command principle.
As the distance between the top and the bottom of the organization is wide, top
managers tend to impose rules and regulations to control the employees
behavior.

TRAINING TYPES AT PSO

In order to main the sustainability of the workforce following many types of
trainings are conducted.

New Technology and methods

Personal Skills Development
Organizational Development
Emergency Training
Environment and Safety Trainings
One- and two-day open enrollment workshops Certification Programs
Project Related Training
Cross Functional Training
SWOT ANALYSIS
STRENGH
1. Market Share of 70% is one the main strength of PSO.
2. Company reputation in the industrial sectors adds the strengths for PSO.
3. Product quality is also strength especially in industrial sector.
4. Service quality like plastic cards and non-fuel activities adds the value.

5. Distribution & Fleet network, which covers 81% country retail network, is the
key edge on PSO its competitors.

6. Promotional activities add value in brand awareness and attraction of new

customers.

7. Innovation like Auto Car Wash helps PSO to differentiate with its main
competitors.

8. Storage capacity, which holds 80% of total storage capacity of the country, is
also key advantage over its competitors.

9. Technical skills in Fleet management are strength for PSO.

10. Visionary, capable leadership adds value to PSO strength like their NVRO
operations.

11. Financial Stability with strong reserves, paid-up capital adds the trust of
stakeholders.
12. Product line width adds long range of products for more revenue
opportunities.

13. Castrol brand affiliation with PSO adds strength in terms of brand awareness.

14. Relations with Government one of the key strength of PSO in order to get
legal protections.
WEAKNESS
1. Lost & Dissatisfied customers are major weakness of PSO as they are causing
the perception of inefficient PSO.

2. Old retail outlets are major weakness for PSO as they are not enough capable
to compete the Shell, Caltex or Total outlets.

3. Untrained staff at outlets is causing inefficient services.

4. Quality assurance is not so effective to build the image of Quality & Quantity.

OPPORTUNITIES:
1. Afghanistans Market is the biggest opportunity for OMCs in Pakistan.

2. De-regularities of Oil industry in Pakistan add the opportunity to fill the

deficiency in few sectors of petrochemicals markets.

3. Export Opportunities of Black Oil Products is also adding the

opportunities by exporting Black Oil products, which is facing downfall due to the
introduction Gas Oil.

4. Industrial & Trade growth in Pakistan is also the opportunity for PSO as they are
adding revenues in Power sector that is the major customer of PSO.

THREATS
1. Risk of forward integration of Supplier is the key threat for PSO and other
OMCs in Pakistan. As the example, the PARCO who is one of the main POL
product suppliers to OMCs adopt the forward integration strategy by introducing
its own OMC with its new business alliance TOTAL and named its OMC as TOTAL-
PARCO.

2. Risk of Diversification in technology is also a key threat for PSO as due to new
technology used in industrial sector is causing decline in particular POL products.
3. Substitutes in Black Oil Market are causing a solid reason for the declining trend
in Black Oil Products, which is major threat for PSO.

CORPORATE SOCIAL RESPONSIBILITY

Pakistan State Oil is committed to playing an active role in supporting and working
with its stakeholders for sustainable community and social development of
Pakistan. With our talented team and national standing as Pakistans leading oil
marketing company, we aim to help drive creation of shared economic and social
value across Pakistan.
Corporate Social Responsibility (CSR) is one of PSOs core values and an integral
part of the Companys overall mission. With operations across the country, PSOs
utilizes its scale of operations as a strength to positively impact the
underprivileged people nationwide especially in the vicinities where PSO
operates. By integrating CSR into our business strategy, PSO is helping to drive
shared value amongst its stakeholders and enhance its corporate brand image
amongst the general public.

Our Focus Areas: PSOs CSR commitments include focus on four main areas
namely:

Education
Healthcare
Community development and Environment
Disaster relief

1. Education: A basic need of society, education has a strong correlation with

social and economic development and reduces poverty and social injustice
by providing resources and opportunities to the underprivileged for upward
socio-economic mobility. We at PSO seek to promote education amongst
the underprivileged of the society as learning remains the only tool that
ensures sustainable human development.

During FY15, PSO undertook a wide range of initiatives to support several

educational programs including:

Partnering with The Citizens Foundation (TCF), the leading education based
 NGO in Pakistan for the education of 125 children hailing from all provinces
of the country.
Working for elimination of child labor, we worked with Zindagi Trust and
Child Care Foundation to take 520 children off the streets and into
classrooms and provide them with education.
Three deserving students from IBA and four students from Institute of
Business Managements outreach program were provided scholarships as
part of our efforts to promote professional education.
PSO also worked with Aman foundation to provide internationally certified
vocational trainings to six deserving candidates while over 200 children
hailing from needy backgrounds were provided nutritionally balanced meals.

The Company also extended support to other educational organizations during

the year.

2. Health care: A key focus area of the Company, healthcare is also a primary
need for millions across Pakistan. As part of its efforts, PSO partners with
institutions involved in health sector and invested in health focused
programs as we believe that everyone should have access to primary
healthcare, irrespective of their financial strength and background.

Some major activities carried out in this focus area in FY15 included:

Helped make medical treatment a reality for over 2,500 people suffering
from a variety of different diseases including cancer, hepatitis, blood related
issues as well as others in association with various hospitals and organizations
including Jinnah Hospital-Lahore, Civil Hospital-Karachi, Fatimid Foundation,
Kiran Hospital, All Pakistan Womens Association etc.
Facilitated treatment of burn victims at Hayatabad Medical Complex-
Peshawar.
Supported construction of a patient bay for Indus Hospital, the largest
privately run charity hospital in Pakistan.
Enabled the purchase of medical machinery including dialysis machines for
Sindh institute of Urology and Transplantation (SIUT), anesthesia and
ventilator machines for Al-Shifa Trust, eye treatment machines for Al-Ehsan
Eye Hospital etc.
In addition, other health care programs and organizations were also supported.

3. Community Building Environment: Under its community building platform,

PSO seeks to enrich the living standards of the underprivileged through
assistance to NGOs, charitable organizations and welfare institutions. We
also work to safe guard the environment, and consciously work toward
conserving the nature.

Some major activities carried out in this focus area in FY15 included:

Helped the Heritage Foundation set up 20 hand pumps and worked with
other organizations including Seed Pakistan and the Taraqee Foundation to
set up clean drinking water plants for the populace in rural Sindh and
Baluchistan.
Supported rehabilitation of over 250 differently abled children across
Pakistan in association with Dar-ul-Sukun, Family Education Services
Foundation, Pakistan Disabled Foundation and others.
Helped house and educate over 250 orphans and elderly persons by
extending support to Roshni Homes, Panah Shelter Homes and other credible
organizations.
Carried out plantation of mangroves and other forest trees in over 100
hectares of land by joining hands with Pakistan Village Development
Program, World Wild Life Funds and other NGOs.

Other community building and environment related initiatives were also

undertaken during the year.

4. National Disaster Relief: While Pakistan has unfortunately witnessed

multiple natural disasters over the past few years, we take pride in the fact
that PSO has proactively contributed in the humanitarian response and
relief efforts and being a national company takes such actions as part of its
civic duty.

Earth Quake Relief: PSO stood with the people of Baluchistan, those who had lost
their beloved ones and homes due to earthquake on September 24, 2013 by
arranging tents, mosquito nets, ration bags and mineral water to provide relief to
affected people of District Awaran, Baluchistan.

Flood Relief: Pakistan experienced the worst of floods of its history in August
2010 which caused immense damage to life and property and left millions
homeless. Pakistan State Oil responded to the needs of the people in the time of
need and established a tent village at Makli, Thatta, provided cooked food and
distributed relief items which included ration bags, tents, blankets and biscuits.

Monsoon Rains: In September 2011, heavy monsoon rains affected millions in

many districts of Sindh. In order to provide relief, PSO:

Distributed ration bags, blankets and mineral water to over 2000+ people.
Set up three (03) free medical camps for treatment of hundreds of
ailments/medical complaints.
Provided free of cost medicines for treatment of ailments by PSO.

Cyclone Relief: The 2007 Cyclone that lashed Pakistans southern coast
crippled life in the affected areas especially in Baluchistan. PSO as a good
corporate citizen as always was at the forefront of relief operations and
provided:

Two convoys comprising three truckloads of relief goods for Turbat and two
truckloads for Pasni.
These convoys carried 3,000 food packets, 500 kitchen utensils, 650
tarpaulin sheets and 30,000 bottles of mineral water.
PSO also dispatched a similar batch of food packets and mineral water to
Greshia, 35 km from Khuzdar which was the first relief convoy to reach this
devastated village.

ACCOUNTIBILITY:
CODE OF CONDUCT:
Code of Conduct In line with managements effort to maintain the decorum and
ensure an environment that is cohesive to the development and success of our
people, a Code of Conduct has been put in place where the following activities
can result in disciplinary action:

1. Unsatisfactory and negligent job performance.

2. Excessive and unauthorized absence from duty.

3. Unsatisfactory safety performance.

4. Reporting on duty under the influence of drug or intoxicants.

5. Absence from duty without notice or permission from the supervisor unless
the cause of absence prevents giving notice.

6. Using influence for promotion, transfer or posting.

7. Conduct that violates common decency and morality.

8. Engaging in a fight or in activity that could provoke fighting on site property.

9. Insubordination or deliberate refusal to comply with reasonable requests or

instructions.

10. Use or possession of weapons, ammunition, explosives, intoxicants, illicit

drugs or narcotics on site.

11. Acts of horse playon site property.

12. Gambling on site property or bringing illegal gambling paraphernalia on to the

site.

13. Theft or unauthorized removal of site property or property belonging to site

employee, contractor and vendor.

14. Intentional damage to site, employee, contractor or vendor property.

15. Dishonest act or fortification of records, including the giving of false

information when required.
 16. Bringing combustible material on site or having any type of match sticks,
cigarette lighter or flame-producing device in restricted areas.

17. Smoking except in designated areas.

18. Using or divulging without permission, any confidential information gained

through employment at the site.

19. Physical, mental or sexual harassment of fellow employee including threat to

do bodily harm.

20. Crime involving fraud, indecency, breach of dignity or public morals and other
serious offences.

21. Any other commission or omission that, in the opinion of the company,
requires/justifies dismissal/termination of employment.

POLICY:

Pakistan State Oil Company Limited will ensure that:

The health of its employees, contractors, customers and public is protected.

All activities are carried out safely.
Environment is protected.

To implement HSE policy, Pakistan State Oil Company Limited will:

Comply with Pakistans relevant laws and regulations.

Ensure that all its activities are carried out in accordance with the
Companys Health, Safety and Environmental Standards and Procedures.
Ensure that environmental performance meets legislative requirements.
Require every employee to exercise personal responsibility in preventing
harm to self or others and to the environment.
Maintain public confidence in the integrity of its operations by openly
reporting its performance to all stakeholders who work with the Company.
Provide appropriate Health, Safety and Environment training/information
to employees, contractors and other stakeholders who work with the
Company.
 Integrate Risk Assessment with all business processes.
Promote prevention of pollution and proper handling and disposal of solid,
liquid wastes and gaseous emissions.
Continuously improve our performance by improving the leadership,
capability and capacity of our organization.

IT GOVERNANCE
In line with its objective of ensuring transparency and oversight across the
organization, PSO has developed an IT Governance policy. This policy defines the
scope of governance and outlines the chain of responsibility, authority and
communication across the Company. For this purpose, an Information System (IS)
Steering Committee has been formed to ensure that all IS strategies are aligned
with the company's vision, review recommendations for improvements in
business processes and to evaluate the impact of improvements on the
company's business and control environment.

LEADERSHIP APPROACH
GOVERNANCE AND LEADERSHIP :
In order to provide dynamism and vitality to the transition , a strong need for
transformational leadership felt by senior management team . According to
Amjad G.M, cooperate planning :

This leadership style include confronting ground realities, modeling desired new
behavior, developing a shared new vision, reshaping the culture and environment
, strengthening coordination and feedback mechanism, communication progress,
and bridging transformational skill gaps.

LEADERSHIP SUCCESSION
As part of transition , a senior management team was inducted in pso to build a
strong coalition, essential for successful transition and to develop future
successors for kiramanis position. At the top of hierarchy, there Executive
Directors and a General manager ,Cooperate Planning were inducted, who
reported directly to MD. This was an attempt by Kirmani to develop multiple
leaders in company. For this he had identified global competiveness, result
orientation, customer focus , cost consciousness and trust to be the foundations
of the attitudes for successful leaders.

CORE LEADERSHIP TEAM :

CHAIRMAN: Mr. Jehangir Ali Shah
SECRETARY: Ms. Shaista Sumar
MEMBERS:
Mr. Yacoob Suttar
Mr. Tariq Hasan Razvi
Mr. Tariq Akbar Khan
Mr. Vaqar A. Khan
Mr. Shahzad Manzoor
Mr. Zulfiqar A. Jaffri
Mr. Babar H. Chaudhry
Mr. Aziz Hemani Dr. Nazir A. Zaidi
Mr. Nadeem A. Memon
Mr. Shahzad Talpur Ms. Shaista S. Sumar
Mr. Khalid Mehmood
Mr. Muneer Esmail Mr. Arif Nasib
Mr. Zahid-ul-Hasan Col. (R) Fazle Abbas
Mr. Qazi Azizuddin Mr. Hasan Hamdani
Mr. Nehal Askari
The Core Leadership Team or CLT comprises the Executive Director and General
Managers of the company. It is chaired by the Managing Director. In this meeting
various company initiatives and progress on different assignments are discussed.
EMPLOYEE LEADERSHIP TEAM
CHAIRMAN: Mr. Jehangir Ali Shah MEMBERS: Mr. Yacoob Suttar Mr. Tariq
Hasan Razvi SECRETARY: Mr. Vaqar A. Khan
The Employee Leadership Team, or ELT, meets on a regular basis and reviews all
matters pertaining to human resources including recruitment, transfers,
disciplinary actions, promotions and employee benefits. The committee also
reviews succession plans and organizational developments.

MODE OF COMMUNICATION
1. FORMAL INTERNAL COMMUNICATION NETWORK
Formal communication network is typically shown as an organization chart that
summarizes the lines of authority by depicting the links in the chain of command
by the boxes in the chart and the transmission of official messages by the lines
connecting these boxes.
Though PSO does not have a formally documented formal communication
network, it does follow a well-set communication network in practice. The flow of
information across the organization can be categorized as follows:
Downward Flow: Organizational decisions are usually made at the top and
flow down to the people who carry out those decisions. PSO is governed by
a Board of Directors, which makes all the organization wide decisions.
These are then communicated downwards to various departmental heads.
Upward Flow: Managers at PSO depend on lower-level employees to
provide them accurate and timely reports on problems, emerging trends,
opportunities for improvement, grievances, and performance. PSO has a
number of standard reports for various departments that are prepared on
regular basis and communicated to the management team. These are
discussed in detail in following sections of this report.
Horizontal Flow: A lot of cross-department and inter-department
communication also takes place daily in PSO. This communication helps
employees to share information and coordinate tasks.
2.EXTERNAL COMMUNICATION AT PSO
External communication carries information into and out of an organization. PSO
constantly exchanges information with customers, vendors, investors, proprietors
of its outlets, journalists, competitors, its suppliers and distributors as well as the
general public and various community representatives.
PSO carries out its external communication through letters, its official website,
phone, fax, television, radio, newspapers and other media advertisements, annual
reports etc. A number of reports that PSO releases on regular basis to its investors
and various stakeholders have been discussed in detail in later sections of the
report.
COMMUNICATING ACROSS TEAMS
As already mentioned in its company profile in the beginning sections of this
report, PSO revamped its corporate structure into a matrix, which has divided the
companys major operations into independent activities supported by the financial,
legal, information and other services. These activities operate in an autonomous
and collegial manner in the form of Strategic Business Units based on the clear and
transparent allocation of responsibility and accountability. This structural change
has been reinforced and related checks and balances have been established by
putting in place several corporate monitoring and control systems. However for
this team-based organizational structure to succeed, it is imperative that
communication across teams takes place effectively and efficiently.
EMPLOYING TECHNOLOGY
PSO is a technologically advanced organization. It therefore has a state-of-the-art intranet connecting the
workstations of all the employees over one network. All the employees working at PSO use Internet, email,
faxes, videoconferences and other forms of modern technological communication frequently. PSO also uses an
Enterprise Resource Planning package, by the name of S.A.P. that is used to generate various reports as well as
allocation of appropriate resources across the organization.

INTERCULTURAL COMMUNICATION
PSO is primarily a single country based organization. Global cultural differences
and the problems that they may cause in the communication process are therefore
not a big concern for PSO as most of its workforce comprises of Pakistani
nationals. However, since Pakistan is an ethnically rich country, there are people
from various ethnic backgrounds working in this organization. PSO maintains a
friendly work environment and uses the two most spoken languages of Pakistan for
its various forms of communication. Therefore such cultural differences do not
cause any barriers to inhibit the smooth flow and adequate understanding of
information.
3. INTERNAL COMMUNICATION AT PSO
Internal communication at PSO can be divided into two main categories; Brief
Business Messages and Business Reports.
BRIEF BUSINESS MESSAGES
Brief business messages at PSO generally include routine requests,
announcements, and good news and good will messages. These are circulated
through email, bulletin boards and/or phone.
Routine requests include such requests for information, action, products,
adjustments or references that are part of the normal course of business and involve
a presumption that the audience will want to comply
Memorandums are an effective and frequently used source of communication in
the PSO business scenario. Every day memos numbering into hundreds move via
the various communication channels, delivering information which ranges from
routine to highly sensitive. Internal memos in PSO are usually dispatched for the
following types of communication:
o Request for action
o Dispatch of documents
o Announcements
o Query and Response to Query

BUSINESS REPORTS
There are numerous internal reports that are prepared at PSO on regular basis for a variety of purposes. Some
of these have been described below.

o AUDIT REPORTS
The Internal Audit Department of Pakistan State Oil is basically responsible for the inspection, review and
assessment of the various business functions of PSO, on a periodic basis. The Department follows two
reporting channels for its audit activities:
Internal Audit Committee: An Internal Executive Committee consisting of the Executive Directors and
Managing Director of PSO.
Board Audit Committee chaired by the chairman of the Board of Directors of PSO.

o BUSINESS PROCESS REVIEW REPORT

Business Process Review is a comprehensive review activity with the basic
purpose of streamlining all business functions in PSO with SAP Systems.
o . STANDARD OPERATING PROCEDURES

Every SOP written down in PSO must be accompanied with a complete and
updated revision history for the document. This history is attached either to the
front page called the cover sheet or to the last page of the document, as
appropriate. The first page is the cover sheet which controls the layout and
components of the entire document.
o DEPARTMENT MANUALS
In Pakistan State Oil, every department must possess an updated and revised manual that dictate its actions and
is able to justify all business strategies employed by the department. The format of the manual differs between
departments in PSO and there is no fixed template to be followed. However, the manual must describe all
functions in a detail so as deemed sufficient to perform an activity.