Challenges faced by Bharat Petroleum:-

If we talk about the challenges faced by the Bharat petroleum there are various number of problem
but some of them are mention in the case study about which we will study here. Some of the
problems are as under:-

(I) Rising wage bill

(II) Low productivity
(III) Lack of control over refinery efficiency
(IV) Lack of Communication
(V) Need for labour flexibility
(VI) Wage revision process during settlements
(VII) Balancing employee demands with business imperatives

Rising wage bill:-

One of the challenges faced by the company is rising wage bill. The workers work for the
wages and Bharat petroleum is already paying the high wage to the workers in comparison with the
other companies in this field. But the employees working for them is demanding for 30 percent
increase in there wages but the company was offering 15 percent of wages and additional
allowances on the biases of there salaries. The allowances includes dearness or cost of living
allowances, house rent allowance, work related allowance, retirement benefits and incentives. But
the BPCL is facing rise in there cots compared to there competitors. The main reason behind this fall
is that BPCL promotion policy in which the worker get promoted after fix time that is 5 year and then
there will in increase in the wages of 5 percent. Due to this kind of policies there were no control on
the workers salaries so company had decided to make it open scale and fix some amount to save the
company from loss.

Low productivity:-

Low productivity is also one of the challenges faced by the BPCL. The company decided
to make some major decision to come of this problem but it was not that much easy for them. To
come out with this problem they decided to fix working hour for the employees because earlier
allowed workers to leave the office half an hour early now they are facing problem of low
productivity and they decided to fix 48 hour of time in a week for every worker. It means now every
individual has to work for at least 48 hours in a week.

Lack of control over refinery efficiency:-

The company have a challenge in there refinery efficiency from which

they were dealing with. The main reason for this problem was the hole refinery process was under
taken by the non-engineers and non- officers who are not that much capable to take all the required
measures and decision but they are not ready to give there authorities to any one but the company
want to appoint someone who is well know and also fresh talents who can make better and quick
decisions.

Lack of Communication:-

Previously there was a lack of proper communication between employees and the
management due to that the company have faced many problems. now the company don’t want to
face the same problem they want to have everything open and clear with the works.
Need for labour flexibility:-

The company needs there worker flexible which they were not. Due to change in
the business environment and government policies the BPCL want its worker more flexible. In 2011
the company faced some issues and they want there workers to be flexible in the regard to there
working location.

Wage revision process during settlements:-

During each settlement employees salaries were adjusted on the last

last day of expiry of the earlier settlement. The adjustment was done as follows first the DA of an
employees will be merged with there basic salary and then it will get multiplied by fitment benefits.
In BPCL they were having open to expand system. After that to come out from this problem they
decided to give according to government policies which say 50 percent to other allowance. And this
50 percent will be calculated on the basic salary and 30 percent retirement benefits.

Balancing employee demands with business imperatives :-

The company was already dealing with the lots of demand of the workers.
But the company have to balanced both employees demand else well as business imperatives.
MR.Gathoo knew very well that they are not in that condition were they can offer 30 percent
increase in the wages. If they do so the company will not meet its budget requirements. But the
union wants 30 percent increment which was not possible for the company.

This are the some challenges faced by the Bharath Petroleum.