Acknowledgements

We like to thank Almighty Allah the most beneficent and merciful for enabling us to reach here and
use His sources to complete our project. We are humbly thankful to Amjid Javed, (General Manager)
and Abdul Razik khattak (Senior Recruitment Officer) HR Department of OGDCL, Islamabad and all
others who guided us during the course of project. The behavior of all the supervisors of HR
Department was very good to us. They were always there to encourage us and they were very co-
operative to guide us the mechanism of the HR Department in which we worked

We are also grateful to Dr Basit B. Tayyab, who gave us opportunity to enhance our
capabilities. This project is very helpful for us because, we have learnt a lot by applying
theoretical knowledge in practical field. In addition, we like to say thanks to our parents to
support us and encourage us at every step.

Introduction

Before the existence of OGDCL, exploration activities were carried out under the label of
Pakistan Petroleum Ltd (PPL) and Pakistan Oilfields Ltd (POL). In 1952, PPL discovered a giant
gas field at Sui in Balochistan. This discovery generated massive interest in exploration and five
major foreign oil companies entered into concession agreements with the Government.

During the 1950s, these companies carried out widespread geological and geophysical surveys
and drilled 47 exploratory wells. As a result, a few small gas fields were discovered. Despite
these gas discoveries, exploration activity after having reached its peak in mid-1950s, declined
in the late fifties. Private Companies whose main objective was to earn profit were not interested
in developing the gas discoveries especially when infrastructure and demand for gas was non-
existent. With exploration activity at its lowest ebb several foreign exploration contracting
companies terminated their operation and reduced land holdings in 1961.

1.1 Foundation of OGDC

On 04 March 1961, the Government of Pakistan signed a long- term loan agreement with the
USSR, where by Pakistan received 27 million to finance the equipment and services of Soviet

experts for exploration. Subsequently, OGDCL was created under an Ordinance dated 20th
September 1961 and was charged with prime responsibility to undertake a well thought out and
systematic exploratory programs and to plan and promote Pakistan's oil and gas prospects.

As an instrument of policy in the oil and gas sector, the Corporation followed the Government
instructions in matters of exploration and development. The day to day management was however,
vested in a five-member Board of Directors appointed by the Government. In the initial stages the
financial resources were arranged by the GOP as the OGDCL lacked the ways and means to raise
the risk capital. The first 10 to 15 years were devoted to development of manpower and building of
infrastructure to undertake much larger exploration programmes. Later, in July 1989, as the
company progressed as a result of major oil and gas discoveries, the Government off-loaded the
Company from the Federal Budget and allowed it to manage its activities with self generated funds.
The year 1989-90 was the company's first year of self-financing. Today, OGDCL is the largest
Exploration and
 7
Production Company in Pakistan, listed on all three exchanges of the country as well as
the London Stock Exchange.

A number of donor agencies such as the World Bank, Canadian International Development
Agency (CIDA) and the Asian Development Bank provided assistance for major development
projects in the form of loans and grants. OGDC's intensive efforts were very successful as they
resulted in a number of major oil and gas discoveries between 1968 and 1982. Two oil fields
were discovered in 1968 which paved the way for further exploratory work in the North. During
the period 1970-75, the Company reformed the strategy for updating its equipment base and
undertook a very aggressive work programme. This resulted in discovery of a number of oil and
gas fields in the Eighties, thus giving the Company a measure of financial independence.
These include the Thora, Sono, Lashari, Bobi, Tando Alam & Dhodak oil/condensate fields and
Pirkoh, Uch, Loti, Nandpur and Panjpir gas fields which are commercial discoveries that testify
to the professional capabilities of the Corporation. OGDCL. (March 3, 2010)).Retrieved from
http://www.ogdcl.com/about-us/History.htm

1.2 Organizational Structure

1.2.1 Main offices

OGDCL Head Office is located at Jinnah Avenue, Blue Area Islamabad and Regional
Offices are located in Karachi and Multan. Besides this OGDCL has its Liaison Offices in
Hyderabad, Sukkur, and Quetta for operational activities. (for details refer to appendix)
(A.Javed, personal communication, march 3, 2010)

1.2.2 Main departments

The main departments of OGDCL are corporate department, exploration and production
department and technical services department. Each of the three departments is further
subdivided.(For details refer to appendix figure 5,3)

1.2.3 No of employees in OGDCL

In OGDCl employees consists of management cadre, executive cadre and overall staff.
Each cadre is divided into pay groups and again each pay group is divided on the basis of
all over Pakistan merit employees and on the quota of particular provinces. (A.Javed,
personal communication, march 3, 2010)
 8
1.2.3.1 Management cadre

The management cadre consists of M-I, EG IX and EG VIII and only 4 EG VIII employees
are open merit based and rest of the 10 employees are from four provinces, FATA and AK
on the basis of quota.

1.2.3.2 Executive cadre

In the executive cadre consists of EG VII(executive general), EG VI, EG V, EG IV, EG III,

EG II, EG I and trainees. In it 143 employees are on the Pakistan merit base and rest of
1762 employees are on the basis of quota from four provinces, FATA and AK

1.2.3.3 Over all staff

Over all staff consists of non-executive employees and trainees. There are 40 employees on the all

over Pakistan open merit and rest of 9150 employees are from Singh, Punjab, NWFP, Balouchistan,

FATA and AK on the basis of relevant provincial quota.(For details refer to appendix, table 1)

1.3 Principle area of business

OGDCL is one of the largest and leading companies of Pakistan. The principle area of
OGDCl is exploration and production of oil and gas. As the leading Exploration and
Production Company in Pakistan, OGDCL’s primary objective is to enhance its reserves and
production profile and ultimately maximize value for shareholders.

OGDCL continues to accelerate production growth through utilizing cutting edge technologies, allowing
the Company to utilize its significant reserves base and capitalize on the strong economic growth and
accelerating energy demand in Pakistan. It exploits exploration Opportunities by building the Company’s
future reserves portfolio through its large onshore exploration land. During the fiscal year 2008-09 target
of drilling is 52 wells. OGDCL’s operating environment will be a major factor in allowing it to control its
low cost structure. Within Pakistan, the Company’s leading position also enables it to access economies
of scale across its significant reserves base and operations. The domestic expansion remains OGDCL’s
core focus, the Company intends to grow and diversify its portfolio through selective international
expansion in the medium to long-term. OGDCL implements international best practices to ensure an
efficient organizational structure and business processes that are focused on core production. As part of
OGDCL’S restructuring plan, OGDCL has established an in-house technical services division, the
Petroserv Directorate, which separates technical support
 9
services from core E&P activities. OGDCL. (March 3,
2010). http://www.ogdcl.com/about-us/Strategy.htm
1.4 Competition faced and level of technology used

Being one of the largest companies, OGDCL faces the competition of many other oil
producing companies. The major competition faced by the company is Pakistan State oil
(PSO) as well as foreign companies, such as MOL etc.

As OGDCL is exploratory and producer of Oil and Gas Company in nature, technology used
in it is very much complex and comprehensive. Technology used in OGDCl for the
production and exploration purpose is mostly imported from the foreign countries. Huge
costs are incurred for importing these machineries from outside. Besides importing
technology from outside various plants and machineries that are manufactured inside the
country are also used. (A.Javed, personal communication, march 3, 2010)

Chapter 2
Human Resource Department
 10
Human resource department of OGDCL is one of the main departments of the OGDCL. Human

Resource Deportment at OGDCL is being reorganized to manage people and develop their skills for
meeting Company’s requirements. Being the largest exploration and production Company, OGDCL
seems to be an attractive company for talented and motivated people in which high levels of
personal and company’s performance are recognized and rewarded. Human Resource Department
seems to ensure development of world class workforce, as per OGDCL’s mission statement, target
based working and performance based reward system has been evolved.

2.1 Functions of HR Department

The Company is focusing on the human resource department, as it aims to motivate its employees
through proper placement, employee recognition, effective appraisals, empowerment, and
communication and promoting employees skill development programs. Various human resource
polices are being reviewed and rationalized by taking into account the industry norms to bring about
an effective change in order to meet the challenges of highly competitive business environment. It
helps to understand and evaluate the different and sometimes ambiguous views of human resource
management by investigating its origins, explanatory models, technology and practice.

2.2 Number of employees in HR Department

In OGDCl, HR Department consists of number of employees under different job titles. There are
round about 13 officers and 97 total staff, as well as there are also data processing officers.
Detailed description is given below in HR Organogram ( for details, refer to appendix, figure 4)

Chapter 3

Recruitment and selection

Recruitment process in OGDCL is conducted under the recruitment section,
11
which generates pool of potential candidates and acts as a real base to provide facilities
of selection of new and old employees.

3.1 Recruitment and selection policies

It is the company’s policy to implement an appropriate recruitment system base on careful
determination of the required competencies and objectives by implying effective search and
selection methods along with the efficient means of communication with potential candidates.

It is the policy of the company that, when ever possible, positions should be filled through
internal job posting and promotions.

All departments’ heads (EDs, GMs, Managers) are to fully participate and contribute to the
hiring process of their respective management staff in collaboration with HR Department.
The hiring process/procedures shall be specified by the HR Department.

All department heads are responsible for making respective description and job specification in

collaboration with an Hr Department, for the purpose of allowing Hr to set annual hiring plan.

All recruitment ( direct or through services contractors) shall be done through human
resource department in compliance with the company’s laid down procedures and
standards, no individual shall conduct recruitment or hiring activity without the specific
knowledge and involvement of ED human resources.

Candidates will be selected on the basis of applicable recruitment tests ( for entry level
positions only ), qualification, experiences, ability, interest, aptitude and adoptability to the
specific job recruitments, as already defined in the respective position description.

The salary offered will be with in approved salary policy guideline of the company (R.
khattak, personal communication, March 5, 2010)

3.2 Functions of Recruitment Section

Recruitment section basically performs the following functions

 12
When ever any department in OGDCL seems to require new employee, it informs the HR
Department to hire new employee for that. Then HR Department analyzes the real situation,
whether there is real need of new employee or not.

HR Department advertize the vacant position in the news paper and in the media to
generate the pool of potential candidates and through the recruitment process hire the new
employee for the specific required department.

Same as mentioned above when ever any department feels the need of employee for the
hire position, it informs the HR Department. On the behalf of that department HR
Department recruit the employee by generating the pool of potential candidates.
When ever there is pool of potential candidates, to select the most appropriate candidate for
the vacant position, HR Department conducts examination, interview and short list the
available applicants. (R. khattak, personal communication, March 5, 2010)

3.3 Practices of recruitment

After circulation to every department they analyze that how many employees perform their
duties and how many are required and they take a deficiency with the scale.

After the completion of circulation or survey they take the official approval from chairman and
give advertisement through public relation department of the most required vacancies. The
sources of advertisements used by HR department are news papers, media and internet.

The recruitment procedure of the OGDCL is mostly related with CSS of Pakistan .i.e. as under:-

Punjab 50%

Sindh rural 11.4%

sindh urban 7.6%

N.w.f.p 11.5%

Merit 10%

Baluchistan 3.5%

Fata 04%

A.j.k 02%
After the advertisement, they receive application from all over Pakistan and conducts

13
written examination. This examination is held in those departments, where the candidate
want to join and that department send the result to recruitment section. OGDCl also hire the
external agencies, which provide facilities of conducting examination of applicants.

The selection procedure is recently shortly changed and is as under:-

Written Test 40%weightage

Experience 30%weightage

Academic Qualification 30%weightage

The time for a written test is usually one hour. Those candidates who qualified the test are
then sent a call for interview. Interviews are used to analyze the courage, boldness
communication skill, convincing power and also his dealing with other people. (R. khattak,
personal communication, March 5, 2010)

3.4 Recruitment types

Regular employees

Contract Basis employees

Trainees – Special Trainees

Hiring through Contractor

Classified appointment (R. khattak, personal communication, March 5, 2010)

Selection

3.5 Selection Practices

Selection process in OGDCL starts with preliminary interview of the applicant who qualified the test.

Depending upon the position, preliminary interviews board is formed, who conduct the preliminary

interview. An applicant’s knowledge, skills and attitude is judged on the basis of following factors.

Education (academic and Professional), Previous experience, Applicable tests (for entry
level position only), Interviews References
The results of the candidates interviewed are compiled in the order of merit. After

14
conducting the preliminary interview, the successful candidates are preceded for the
selection interviews, conducted by selection board. This selection board is formed while
considering the positions required. After selection interview, the successful candidates are
required for pre-employment medical examination arranged by the HR department. In this
way HR department completes the selection process and formulates the job offer. Job offer
or appointment letter is delivered to the successful candidates. This letter clearly spells out
the terms and the conditions of employment and the benefits applicable to the position. All
management position offer letters are signed by ED (executive director HR), while Executive
Director’s position letters are signed by the chairman and CEO.

When there is no suitable replacement available within the company and when all sources
has been utilized with no results to fill the vacancy with highly potential candidate, then
company rehire an ex-employee on merit.

For the requirement of certain position the company re-engaged the retired employees who
are beyond the age of 60, after mutually agreed terms and conditions.

In order to keep the track of attrition, to know the reasons leaving job and to collect the feed
of leaving employee, the exit interview is conducted by the HR Department. This is also
done in order to reduce employee turn over, because greater the employee turn over,
greater will be the cost of employment. All these practices seem to be aligned with above
mentioned policies. (R. khattak, personal communication, March 5, 2010)

3.6 Analysis

To recruit the employees both internal and external methods are used with in the OGDCL, but
analysis reveals that the corporation gives preference to the internal method. The main draw
back of this method is that it blocks the way for new generation which carry new ideas and
knowledge. Further more the recruitment system is also influenced by the nepotism of
politicians. Not only recruitment of employees is influenced by the nepotism of politicians, but
selection also. Employees for high positions are selected on the basis of personal relations and
blood relationship. Though OGDCL is the largest and very multifaceted organization, in spite of
that there is no computerized data based system to record the data of employees.
 Training

All employees (regular and contract) are provided the opportunity of training to accord equal

opportunities for professional development and to ensure effective management It is seemed that

need of job redesign and technological break through in OGDCL require training of employees.

5.1Training policies
 18
All matters concerning foreign/local trainings/attachments, conferences will be dealt with
directly with the HRD (human resource department.

The HRD department training coordinators shall work with Department Head and finalize a
list of well reputed training sources both local and foreign in all disciplines of organizational
development. The vendors shall then be prequalified by the HR Department.

The HRD department training coordinator, in vendors shall make a discipline wise
local/foreign training calendar covering the professional and the organization development
aspects through a TNA (training need assessment). The same shall be emailed to each
department head by July 15th each year.

In case of foreign program, the HRD department training coordinators are to ensure that
proper lead time is forecasted for processing, keeping in view the visa/travel arrangements.

The respective department head would be required to forward names with number of
officers/staff that qualify the prescribed training benchmarks with in the announced
deadlines, though an email to the HRD Department.

The HRD Department training coordinators shall carry out due diligent, process the received
names as per the prescribed parameters, get the required approvals and prepare the
qualifying list. (R. khattak, personal communication, March 30, 2010)

5.2 Practices of trainings in OGDCL

To implement its policies OGDCL use the following practices:

5.2.1OGTI

OGDCL has well build training institution to conduct the training of its employees. The training institute

consists of OGDCL local instructors, outside local instructor (in case of absence of OGDCL instructor)

and foreign instructor. These instructors provide the services of training the employees. They train the

employees appointed by HR department and follow the relevant policies which ultimately leads to

organizational development. Present employees are also sent to foreign country for
training as per policy. OGTI provide the facility of sending employees to foreign for

19
enhancing new skills, abilities and knowledge by joining training sections.

5.2.2 Local training programs

Local training programs are mostly on going job training provided by the local trainers on the
fields of OGDCL. Mostly these types of trainees are assigned job of training by the OGDCL.

5.2.3Leadership training program

Leadership training programs are mostly for the leaders with in the organization. This type of
training is conducted by highly professional trainee from home country or from foreign expert
assigned by OGDCL.this leads to overall organizational development as cited in the policy

5.2.3 Advance management program

Advance management training programs are designed for higher level management. In these

types of training highly expert trainees conduct proper training sections for the employees.

5.2.4 Conferences

Conferences are held in OGDCL on the regular basis by GDTI. These conferences not only
enhance the real knowledge about the exploration and production but also present the true
picture of the real working scenario.

5.2.6 Others

In addition job rotation, seminars, lectures; committee assignments are also used for training
(R. khattak, personal communication, March 30, 2010)

5.3 Analysis

Training is used to develop the skills abilities and knowledge of the employees, in this
regard lot of expenditure is made but unfortunately training facilities are awarded to the
employees based on nepotism. As OGDCL has it training institute to facilitate employees,
unluckily training sessions are held for reference based employees only. In addition, they
don’t use the efficient and effective training methods and techniques to build above
mentioned attributes of the employees, such as no simulation techniques are adopted to
train employees. Training is done mostly through on the job mentoring and coaching
 20

Chapter 6

Development and Promotion

6.1Career planning and development

Career planning is basically career orientation and career development. Career planning
section is under the control of HR manager. It informs the employees of OGDCL about their
future planning. i.e., they prescribed to the employees their operational set up. It informs the
employees that what they will do after 5 years And 10 years. Promotion is main source of
career planning here. The elaboration is as under:-
 21
8.1.1 Promotions

6.1.1.1 Promotion policies

Promotion is the mixture of both merit and seniority in OGDCL.

The company reserves its rights to promote or not to promote any functionary, with in the
specified guidelines

HR department shall prepare and finalize a list of all employees who are eligible for
promotions along with options, by end of June each year the same shall be communicated
to respective department’s heads for consents, review remarks. Under mentioned criteria
shall be adhered to for processing of all promotion cases.

All promotions would henceforth be on the basis of merit. All eligible employees at the time
of submission of promotion proposals should be considered and the employees securing
highest points would be promoted subject to availability of vacancies.

All positions are too benchmarked according to the educational qualification, number of
years of relevant experiment and trainings/certification, required to efficiently carry out that
particular function, minimum/maximum level that could be attained in that position, cross
functional roles, care path etc.

An employee to become eligible for promotion must physically complete two years services in
the grade for promotion up to EG-VI and three years for promotion to EG-VII and exceptions can
be when hire vacancy to be filled internally and available employees is of “Outstanding” profile.

All promotions will be linked with the future organizational development needs of the company.

There is no maximum limit of the services in one grade.

The employees who are superseded twice for the promotion to the next grade will be considered
to have been permanently superseded. However, their annual increment shall continue to be
linked to their respective performance rating up to maximum of that level only. Their length of
services shall be determined by the number of the years benchmarked for that position. For
contractual employees to consecutive below average ratings, no contract extension shall be
made after due diligence by HR. (T.Ahmad, personal communication, April 5, 2010)

6.1.1.2 Promotion
practices
 22
For giving promotion to an employee its performance and relevant work experience is considered.

Promotion Criteria in OGDCL for officers was adopted in 1994. Its main components are:

ACRs : 60%

Qualification : 15%
Technical Publications : 05%
Relevant Experience : 20%

Seniority come fitness is the guiding principal in promotions

The promotion cases of Staff are evaluated as per Promotion Criteria of 1991 its highlights are:

ACRs : 25%
Qualification : 15%
Seniority : 05%
Experience : 15%
Evaluations : 40%

(Refer to promotion chart in appendix)

(T.Ahmad, personal communication, May 5, 2010)

6.1.1.3 Important factors for promotion

There are many factors affecting the promotion in OGDCL, such as experience for the post,
number of the years in the vacancy, seniority, performance (ACR/PER Synopsis or qualification)
prescribed qualification, requisite present executive group and finally disciplinary profile. While
promoting any employee, above factors are kept at the mast priority to have a close look of
them. (T.Ahmad, personal communication, April 5, 2010)(for details refer to appendix figure 2)

6.2 Organizational Development

In OGDCL just like any other organization, organization is developed when its missionary objectives

are met. To achieve missionary objectives goals are set up with in the organization. To achieve the
 23
goals certain strategies are formulated and finally strategies require actions and tasks to be

implemented in the form of project (T.Ahmad, personal communication, April 5, 2010)

6.3 Management Development

Management development is linked with career development. Management development is done in

order to enhance the effective decision making, better working management and to develop the
sense of responsibility. The techniques the OGDCL practices for the career development are
promotion of employees to higher levels and job rotation of the employees to various positions in
different departments. They provide employees exposure to environment, which leads to the
enhancement skills, abilities and knowledge. (T.Ahmad, personal communication, April 5, 2010)

6.4 Analysis:

Analysis reveals that career planning section works in close collaboration with the human resource
department for planning career of their employees however not much time is given by the section to
guide the employees for developing their career. They are usually guided in an informal way.
OGDCL is only organization in the field of exploration and development of oil and gas resources of
the country, but unfortunately does not use scientific techniques in career planning of employees
promotions are major source of career development here. However is also analyzed that promotion
process is comparatively slow which some times create a feeling of demotivation among employees.
An organization is developed when its missionary objectives are met. So 0GDCL meets its
missionary objectives through mega projects for organizational development
 24

Chapter 7

Performance Appraisal System

Performance review helps supervisors feel more honest in their relationship with their subordinates
and feel better about themselves in their supervisory roles. Subordinates are assured clear
understanding of what is expected from them, their own personal strengths and areas for
development and a solid sense of their relationship with their supervisor. Avoiding performance
issues ultimately decrease morale, credibility of management, the organizations overall effectiveness
and wastes more of management’s time to do what isn’t being done properly.

7.1 Performance appraisal policies

Appraisals based on balance score card model taking in facts the employees professional
output as well as personal traits that may affects his performance.

All company employee will be appraised at the time of completion of trial (period will be of six months

as per the recruitment policy). In case of satisfactory performance their services will be confirmed,

and confirmation letter will be issued by the human resource department. At the time of
the confirmation, management/ HR may consider salary adjustment. In case of

25
UN satisfactory performance,

Probationary period may be extended for further periods of three to six months .Appraisal will be
done once every year during the period July-august on the prescribed appraisal form from
employees .in management grades. (R. khattak, personal communication, April 7, 2010)

7.2 Practices

The scoring system is having a major impact on effective performance appraisals. The
accuracy and reliability of any scoring system increases with full descriptions or definitions
and still better with examples for each score band. This gives everyone the same objective
scientific reference points, and reduces subjectivity.

All the departments at OGDCL are enforced to follow following performance rating

Outstanding 05%

Very Good 20%

Normal 50%

Marginal 20%

Poor 05%

In OGDCL Issuance of ACR forms toke place to all departments according to time schedule
usually 15th December of each year. And reception of the ACR forms toke place at the date
of 1st March of each year. After receiving the forms proper record is maintained, because its
secrecy and integrity is very important. (R. khattak, personal communication, April 7, 2010)

7.2.1 Activities (ACR)

ACR evaluate employees on the basis of perception and judgment.ACR was used to
provide comprehensive instructions from time to time to educate and clear ambiguities. ACR
forms have been serialized for officers to minimize duplication/ misuse.
Actually ACRs were not filled or /returned according to the notified schedule. Lot of time and efforts

were involved in correspondence. Over-writing, use of fluid, mere marking instead of initials were
 26
the most commonly observed problems. There was lack of consistency in various parts of

ACR that is frequently noticed. (R. khattak, personal communication, April 7, 2010)

7.2.2 ACR replaced by PER

That’s why ACR technique used for the purpose of performance appraisal was changed into
PER (Performance evaluation report) in 2005. Through PER now employees are evaluated, on
the basis of provided tasks, assignments and projects completion. It neglects the factors of
biasness and perception based evolution(R. khattak, personal communication, April 7, 2010)

7.2.3 Relative and Absolute standards

. In the beginning ACR use relative standards to evaluate employees. They evaluate employees more on

the basis of perception and judgment. However now a days it was replaced by absolute standards in

PER. PER evaluates employees performance keeping in view job description of any specific employee

i.e., performance is evaluated on the basis of pre assigned tasks checking whether they are fulfilled or

not. On the basis of evaluation employees are promoted and given rewards.

Basic component of the promotion criteria with their relatives weight age would be as under;-

1 . Qualification 15%

2 . ACR’s 25%

3 . Seniority 05%

4 . Relevant experience including

Experience outside OGDCL 15%

5 . Assessment by the promotion

Committee 40%

-------------------

Total 100%

---------------------

These five basic components are analyzed before promotion criteria. When any employee qualifies

these components then he will be promoted with the approval of the chairman. For every employee it
is necessary to get minimum 60% marks in above components. (R. khattak,

27
personal communication, March 7, 2010)

7.2.4 Classification method

Classification method is usually used to evaluate employees by establishing distinct classes
of grades such as skills, knowledge, working condition and employees are evaluated on the
basis of these criteria. (R. khattak, personal communication, April 7, 2010)

7.3 Analysis

After analyzing the performance appraisal system it becomes clear that though PER is replaced
by ACR which is more judgmental based and PER evaluates employees on the basis of certain
assigned tasks but here also sometimes performance evaluation is influenced by personal
relation and perception of the person who is being evaluated. Any body that has personal
relations with his boss get high marks and is evaluated more positively.
 28

Chapter 8

Rewards and Compensation

8.1 Reward policy

It is the policy of OGDCL to award both financial and non financial performance based
rewards to its employees. (A.Javed, personal communication, April 26, 2010)

8.2 Practices

In OGDCL, both financial based and non financial based type of rewards are provided to
employees. Financial rewards are actually performance based rewards, which include
bonuses, one month additional salary etc, while non financial rewards are mostly letters of
appreciation and recognition. Additionally rewards in the form of honorarium are also
provided, allotting separate parking space serve as recognition and reward to high level
positions. These rewards actually seem to motivate the employees to show the commitment
with the organization. (A.Javed, personal communication, April 26, 2010)

8.3 Pay plans

For the offers pay ranges from 45000 to 100000 rupees, for assistant pay ranges from
25000 to 40000 rupees and for workers pay ranges from 15000 to 20000.these pay plan is
established after compensation survey using the information that what others in the same
industry are paying for same positions. (A.ali,personal communication, may 4,2010)

8.4 Compensation
OGDCL provides 15% increment on the best performance, 7% increment on

29
average performance and it also provides performance bonus on net profit.

OGDCL provides additional benefits to employees such as friendly working environment, pick &
drop Service, allowances for food, heads in annual budget for staff, fire Department, air base
(under process) and fly camp (entertainment). (A.ali,personal communication, may 4,2010)

8.5 Other Benefits

OGDCL develops appropriate retirement plan to benefit its employees

In addition various kind of medical benefits are also provided

X-ray and laboratory diagnostic facilities are available at M.C Islamabad. Patients are referred
for hospitalization as and when required to hospital/nursing, homes /specialist on the panel of
the corporation and re-imbursement is allowed when such facilities are not availed. Medicines
are provided to patients from entitle panelist chemist through prescription. Vaccination facilities
for children are available at both medical centers and every Monday is specially fixed for this
purpose. Ambulance equipped with first aid kit is available at medical centre Islamabad for 24
hours duty. (A.ali,personal communication, may 11,2010)

Residential facility is also provided to facilitate its employees

8.6 Analysis

It is analyzed that there is an injustice system of distribution of rewards to employees. The

senior positions are rewarded higher as compared to rewards given to workers and junior
positions. It also leads to demodulation among employees when they see and feel such big
differences. Being a public sector organization it is also analyzed that OGDCL provides a
number of facilities to its employees and try to retain its employees using this policy.

Recommendations
Following recommendations can be helpful to get rid of the weaknesses of the functioning
of human resource department.

Equal opportunities should be given to external employees during hiring process. This will bring new
ideas, knowledge and experience to the organization. In addition recruitment should be done totally
on merit basis.favorotism and nepotism should be avoided. In this modern area computerization of
record is very much essential. There should be computerization of record because it is of great
essence for speedy disposal and accuracy of record. Although OGDCL usually import technology
from outside however to meet the changing needs it must take actions and allocate higher budget for
hiring it. Formal method of orientation should be used. Training should be provided on the basis of
requirement. Equal opportunities should be given to employees to train them. Full attention should
be given to intensive professional training of staff in related fields. . The department can organize
professional training at OGDC or with outside agencies etc and latest literature newspapers and
magazines etc of professional interest should be provided at sites free of cost. Career planning
section must give adequate time in guiding employees how to develop their career. Appraiser must
appraise employees on the basis of actual performance. Performance evaluation on the basis of
judgment should be avoided. To encourage the employees to take interest in their work rewards
should be provided but there should be fair means of distribution of awards. Unjust distribution of
awards must be avoided.empolyees should be encouraged to come up with their own ideas.
Initiative killer environment must be removed. In the end it is strongly recommended to eliminate the
government influence on each and every function of HR department at OGDCL

Conclusion

From this whole discussion we conclude here that though HR department has well formulated

policies. There is strong need for the just implementation of such policies. Though each and every
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thing is written in papers about these policies but unfortunately practices in some cases are
quite different. So practices must be in accordance of the policies and government should not
use its influence and provide freedom for the proper functioning of Human resource department.

References

OGDCL. (March 3, 2010)).Retrieved from http://www.ogdcl.com/about-us/History.htm

OGDCL. (March 3, 2010). http://www.ogdcl.com/about-us/Strategy.htm

OGDCL, (March 3, 2010) , retrieved from http://www.ogdcl.com/about- us/Directors.htm