HRM Project on Pakistan Tobacco Company (PTC)

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British American Tobacco is the world’s most international tobacco company with an impressive market position in Latin America and a robust position in all the other regions including America pacific, Asia-Pacific, Europe and Africa and Middle East (AME).for 100 years, British American Tobacco has been building an international reputation for producing high quality tobacco products to meet the diverse preferences of consumers. Leading edge manufacturing BAT focuses on quality and excellent distribution capabilities enabling consistently to deliver premium products in 180 markets.

“To achieve leadership of the global tobacco industry in both a quantitative and qualitative sense.”

BAT has 15% of the global market and is the second largest international tobacco company and the market leader outside the US. For BAT leadership is about being recognized as a high quality business with excellent people and products and being seen as a benchmark company.

Focus on markets where it can retain or achieve portfolio leadership and build premium positions such as Middle East, Japan, South Korea and Taiwan.

The key to profitable growth is to developing business from its origins in local, full flavour lower price brands towards the growing, more profitable segments.

BAT expect to be able to reduce costs by sharing services between markets ,as well as by taking advantage of significant opportunities to achieve savings from intelligent application of “e” business to entire global supply chain.

1. Focused brand portfolios communicated through state-of-the -art adult smoker engagement programmes.

2. Industry leading product portfolio, designed to address consumer needs and societal expectations.

6. Wired for # 1: Aim to reduce blockages to efficient, effective and timely operations by connecting network of people, places, processes and business partners.

7. A winning environment inspiring passion for the business, talented people and personal fulfillment.

Human Resource in British American Tobacco aims to attract, develop and retain the most talented people around the world. The purpose of HR is to help shape the culture of this dynamic business, creating an environment that emphasizes and reward performance, whilst supporting learning and development.

Measuring and aligning performance, rewarding performance, managing and administrating benefits.

Managing change, designing and development the organization, managing organizational climate, learning in the organization.

Assessing competencies and potential, career development systems, coaching and mentoring, training and development.

Managing employment legislation, managing work place relations, managing HR customer service.

HR is essentially about managing people and their expectations. Attracting and recruiting the very best people is of major importance to the company. this has involved coordinating presentations at leading universities, assessing application forms, interviewing potential recruits, organizing assessment centers, training assessors and facilitating the selection decision making process.

Pakistan Tobacco Company was the first multinational to set up its business in 1947 in Pakistan it took over business from Imperial Tobacco Company that was operating since 1929 .In 1948 commenced pioneering of Virginia Tobacco Cultivation. Pilot production plant was set up in a warehouse near Karachi port with a monthly production of 30 million cigarettes, which is now in 2002, is over 2 billion cigarettes per month. The rapid expansion in the cigarette market over the years led to the establishment of our state of the art manufacturing facilities in Jehlum and Akora Khattak.

PTC is a subsidiary of British American tobacco (BAT) group, which is the largest international tobacco group and has its business in 180 countries all over the world. BAT holds 94% shares in PTC .They hold strong market positions in each of their regions and enjoy a market leadership present in more than 50 BAT manufactures with over 300 brands in its portfolio and a market share of 15 percent. They make the cigarette chosen my one in seven of the world’s one billion adult smokers. They have nearly 100,000 people around the globe and have over 80 factories in 64 countries.

It produces high quality tobacco products to meet the diverse preferences of million of consumers, works in all area of the business “from seed to smoke”. Its operations began in 1902, and its companies are committed to providing consumers with pleasure through excellent products and to demonstrating that they are meeting their commercial goals in ways that are consistent with reasonable societal expectations a responsible tobacco group in the 21^st century. The company’s principal activities are manufacturing and selling of cigarettes and edible oils (Sundrop).

Pakistan Tobacco Company has come a long way from being just a single factory operation to a company which is involved in every aspect of cigarette production, from tobacco cultivation to packaging but what is really significant about these fifty –five years is the tremendous effort that Pakistan Tobacco Company has played in the development of the country .By spear heading the campaign for modern agriculture and industrial practices, they have been instrumental in the development and progress of the agriculture and industrial sector in the country.

Pakistan Tobacco Company has been leader in innovative marketing campaigns, which brought a whole new competitive edge to Pakistan business world. PTC is returning its debt in the form of various altruistic activities.

Over the last half –century PTC have been supporting and giving donations to various causes of national interest educating growers in the latest techniques and technology in agriculture, afforstation and sponsorship of sports.

Through these fifty-five years, PTC continual investment in People, Brands, technology innovation and the communities in which it operates has borne fruit in the form of transforming into a company strong enough to go through thick and thin with the country. Pakistan Tobacco Company is responsible for generating a lot of economic activity and introducing innovative ideas and break-through within Pakistan.

“Our people are the heart of our business and these world class people work as a team to meet challenges in an ever changing environment .We believes in open and honest communication and this belief has harnessed an open and transparent culture within the company”.

Milestones:

PTC has come a long way from being just a single factory with restricted operations .The role it has played in the economic development is commendable. From the spearheading of modern machinery and industrial practices to incorporating the global standards within the structure of the company, PTC has contributed a lot in both monetary and non-monetary terms.

Vision of PTC:

“First Choice For Everyone”

Mission Statement:

“Transform PTC to perform with the speed, flexibility and enterprising spirit of an innovative, consumer focused company”

“Together we will be the best in everything we do”

Motto OF PTC:

Dare to be different --Dare to dream --Dare to try --Dare to frail --Dare to succeed

To lead the organization in enhancing its human capital and creating a winning environment where everyone enjoys contributing to the best of one’s ability.

· Driving an open minded and enterprising corporate culture where people through leadership at all levels dare to dream, dare to try, dare to fail and dare to succeed.

· Attracting and recruiting the best talent fulfilling customer’s expectations.

Human resource department will continue its effort towards nurturing a winning corporate culture and building organizational capabilities by ensuring that its people at all levels are both able and willing to perform at consistently exceptional levels. At PTC the people have been empowered to a large degree by minimizing out dated rules /regulations and plan to further eliminate the bureaucratic barriers to capitalize on their ingenuity and talent .The top team continue to play its role in providing the guidance and support to people at all levels. The HR (people’s) function ensures that it leads the transformational change by nurturing a climate, which would help in converting the huge potential at disposal of the company into world-class performance.

The active and effective role played by HR in people development at different levels organizational, departmental and individual is considered in PTC to be one of the most critical factor leading to the development of a winning corporate culture. The effort continues to be directed towards developing the skills of the shop floor employees, improving competencies of Business Support Officers (BSOs), and enhancing the leadership qualities of managers.

· Continue to nurture strong, open minded and caring leadership at all levels with an enterprising spirit of “Dare to dream… Dare to try to try…dare to fail …and dare to succeed”.

· Ensure to develop people at all levels, both in terms of skills to undertake challenging assignments and the “will” to take greater responsibilities.

· People at all level take charge for their development and constantly look for opportunities to enhance their knowledge, skill and leadership attributes.

· Ensure that PTC becomes a learning organization where knowledge management becomes an established way of developing people.

· As far as possible, match the individual aspiration with the organizational needs to encourage personal fulfillment.,

· Ensure transparency in career management to encourage and recognize talent as well as performance.

· Prepare and develop the line managers to take ownership of the “HR Tools” e.g., developing people, more active involvement in career management (CDM), Sharing of learning (HR Intranet).

· To enhance the employability of employees for keeping them motivated and secured.

· Become a 1^st choice employer in a growing environment where talents supply will fall short of demand.

Strengthen the CDM process to bring more transparency and commitment to career management and development plans and as far as possible will match the aspiration and capabilities of individuals with the needs of the business with a view to ensure personal fulfillment. Pushing down the involvement of line managers so that careers are managed by them with the advice and tools provided by HR.

CDM feed back to be shared with the individuals without holding any bars .This would bring more authenticity to the process where career moves will take place as far as possible in a planned way.

Create an environment where people development is one of the key drivers for success. Develop emotional and professional maturity of managers to enable them to demonstrate inspiring leadership traits. Training inputs on leadership, emotional intelligence and lateral thinking. Top team to act as role model and encourage people below to demonstrate and inculcate coaching culture for coaching. Emphasizing to people that through coaching others will also develop themselves. Incorporate people development in principal accountabilities of each jobholder. Top team gives more focus to the mentoring process of selected managers.

To reduce silo thinking and develop “Business Managers” they create more awareness and appreciation about how various functions contribute to the overall objectives of the company. This will support efforts for enabling people to understand the impact of their role on other functions and overall business.

T&D will provide a platform to get one/two day’s courses organized each year. e.g.

Focus on individual to inspire them and provide them with tools to pursue personal excellence without getting bogged down through self-imposed limitation in thinking and actions. Supporting people to learn from mistakes in pursuit of business excellence. Encourage people to think differently.

Encourage managers to read “Accelerating Growth” on the intranet to self learn the new process. Drive to transfer the ownership for learning and development to individuals –no spoon-feeding .train managers on “Self Service” .top team to fully subscribe to the philosophy and encourage the managers to use the new tool as a “Business Tool” instead of “HR Tool”.

To nurture an environment where all people are allowed and encouraged to develop themselves and give willingly their very best without fear. Provide the necessary platform to develop and inspire individuals and teams to share rapidly and effectively their knowledge /success and failure to enhance team potential and competence. Develop a system for knowledge management and resource allocation in the form of personnel to facilitate. Learning resource center to cater for the self-learning opportunities e.g., e-based training.

Create an understanding that “Training Only “would not be sufficient to develop people and that other development opportunities should be identified and agreed by the individuals and line managers e.g.,

Conducted benchmarking of Training & Development activities with other multinationals within Pakistan and with other regional companies.

To recruit management trainees in Marketing, Finance, IT and HR, PTC mainly rely on MBA’s graduating from local institutions, barring a few students returning home after qualifying from foreign universities.

Well-managed internship program will help to “catch them young” rather than waiting for the graduating students up to the last moment. Involvement with the students joining the professional institutions starting first year they join.

PTC aim to be the most attractive employer in local job market, this is done through,

· Ingenuity in use of Merit Matrix, giving more freedom to the line managers when reviewing the salaries of their teams

Keep reviewing organization structure, on need basis, for right sizing. Constant review of role profiles through job evaluations. A flexible approach in designing the remuneration package for the new generation managers who are more interested in higher take home pay rather the retirement plans. Instant recognition of outstanding performance /contributions towards productivity improvements

Salary increment for those with “A” rating is 17% higher than those with “C” ratings whilst no salary increment was granted to those with “D” ratings.still planning to widen the gap between excellent, satisfactory and weak performers to appropriately incentives high performance .The incentive schemes and incentive objective have been clearly communicated to all individuals and weekly progress report is also communicated to all concerned.

Building morale of people and creating a winning culture continues to be the foremost objective where ordinary people can achieve the extra-ordinary by performing willingly to the best of their abilities. The cross culture team continues its efforts towards integrating the various cultural element of the organization. Some of the activities that would further cement efforts in the plan to achieve excellence through a highly integrated and fully committed team include:

IR is given special importance by increasingly involving unions and employees to sustain the environment of trust, empowerment and mutual respect. Continuous education and visit to other BAT companies and multinational in Pakistan further broaden vision to support initiatives for change and inculcate entrepreneurial spirit. PTC has demonstrated Fair &Firm deal on issues and principles to ensure good working environment and business partnership with unions.

These are few of the HR practices that I have learned at PTC from my resource person.

Recruitment starts from the requisition by the line manager and ends on appointment /documentation.

The process is same accept that after the preliminary interview the panel recommends few candidates who are tested for their managerial capabilities they have to go through stages of assessment .the candidate at the assessment center has three experienced and knowledgeful person who evaluate him at different stages. The different phases upon which the candidates assessed are:

Training is a planned effort by a company to facilitate employees learning of job-related competencies. These competencies include knowledge, skills or behaviors that are critical for the successful job performance.

At PTC, there is a continuous assessment of the technical and managerial skills .for the further enhancement of these skills formal training programmes are offered at all levels. The employees are provided wit opportunities to put these skills into practice, in preparation for the move to a managerial role. Training is viewed at PTC as a way of creating intellectual capital. Employees are expected to acquire new skills and knowledge, apply them on job and share this information with other employees. The training is cross-functional for sharing of skills. The training programmes also include International Seminars.

A new initiative has been taken which covers all employees is the course “lets lead change from inside out” in which employees are taught how to react to environmental and technological changes and how to cope with the situation.

WOW “Winning In Our World” is a workshop held every week to bring employees, distributors, suppliers, and farmers together where they interact in a harmonious environment. The challenge of WOW is “Nurturing a winning culture that drives to achieve the extraordinary by performing to the best of abilities”.

Performance appraisal at PTC is used to evaluate the job performance of employees. HR department use the information gathered through performance appraisal to evaluate the success of recruitment, selection, orientation, placement, training and other activities. Formal appraisals are needed to help managers with placement, pay and other decisions. This kind of formal appraisal in PTC for Business Support Officer is called STEPS or Success Through Performance Evaluation the method used for managers is called PACE or the Performance Appraisal For Career Enhancement.

The appraisal forms are rated by the managers or concerned authorities on the basis of Core Skills and Functional /Technical Skills. The comparison of the actual level of competency and the expected competency level which is also defined as meeting the success criteria gives a true picture of where these employee stands. The strength and weaknesses are analyzed and according to that, a training program is arranged to overcome the problems. In PTC, a standard measure is a Success Criteria that reflect the behaviors needed to embrace to meet the future demands.

· Demonstrate a low skill /knowledge level in most of the core priority areas for the job. Highly intensive or re-education regarding approach is required.

· Demonstrates some effective skills /knowledge in the competencies areas for the job but there are some important core skill gap to be developed.

· Demonstrate effective skills/knowledge in the majority of the core priority areas for the job. Has attained standard expected of target group given the constraints of the environment and job role. There are still some areas to be developed.

· Is extremely effective in all skills/ knowledge areas required in the job. Is performing at the highest standards expected in the role.

PTC considers its employees not just as a cost but as a resource in which the company has invested from which it expects valuable returns. Pay policies and programs are one of the most important human resource tools for encouraging desired employee behaviors. The advantage of paying above the market average is the ability to attract and retain the top talent available, which can translate into highly effective and productive work force.

If a worker works for more than nine hours in any day or for more than 48 hours in any week in a non –seasonal or seasonal factory, he shall be entitled in respect of overtime worked to pay at the rate of twice of his ordinary pay.

It is the company policy to ensure that the required standards of performance and conduct are maintained. The disciplinary procedure is intended only as a statement of Company policy and management guidelines. It does not form part of the contract of employment or otherwise have contractual effect.