Final Project

Name: Muhammad Hamza Zahid (L1S16BBAM0099)

Muhammad Adil Javed (L1f18BBAM0018)

Inshal Saleem (L1F18BBAM0416)

Subject: Fundamentals of Management

Date: June 9, 2020

Submitted to: Mam Huma Khan

Topic: Berger Paints

 Part 1: Overview of the organization

Introduction of Organization:

Berger was established two centuries ago and it is one of the World’s largest paints
manufacturer. In 1950, Berger started its operations in Pakistan. It became public limited
company in 1974 when 49.38% of its shares were acquired by Pakistani investors. Berger then
established its first local manufacturing facility in Karachi in 1955. Similarly, as the country’s
economic and industrial sector expanded, to meet the demand they established another facility in
Lahore in 2006.

Vision Statement:

“We will become the leading paints and associated products manufacturing and marketing
company in Pakistan ensuring best returns to our investors & highest customer satisfaction.”

Mission Statement:

 We will lead by innovative ideas and technological development in the paints and
associated products in Pakistan ensuring efficient utilization of resources yielding high
returns.
 We will ensure highest level of commitment to achieve best quality products and
services.
 We will vigorously promote and safeguard the interests of employees, shareholders,
business associates & all other stakeholders.
 We will act as a good corporate citizen ensuring service towards community and shall
focus on environment, health and safety.
Link between Companies’ Vision and its Ethical Standards:

Vision statement states the company’s objectives and helps them in decision making in
future. The link between ethical standards and vision statement is that the company should not let
go of their ethics while trying to achieve their objectives. They must not violate their employees,
environmental standards and specifically their customers. They must not adopt bad ways in order
to compete with other fellow companies and achieve their objectives. They should take some
responsibility of environment. If they are taking resources out of it, they must give something
back in return.

That’s why top management should put forth clear vision statement and ethical standards with it
so that no harm shall be attained by employees, environment and customers from the company.
Similarly, high ethical standards can help build success for the company through job satisfaction
and customer loyalty.

Product Lines:

The business lines of Berger paints are as follows:

1. Decorative Business
2. Automotive Business
3. General Industrial Finishes
4. Powder Coatings
5. Protective Coatings
6. Vehicle Refinishes
7. Road Safety
8. Government & Marine
Competitors:

Berger is mainly a paint industry and its competitors are:

1. Brighto Paints
2. Diamond Paints
3. Gobis Paints
4. Honey Gold Paints
5. Nippon Paints
6. Sparco Paints

Part 2: Structure of Organization

Organizational chart:
Key Positions:

Following are the key positions in the company Board of Directors:

1. Mr. Maqbool H. H. Rahimtoola ( Minority Shareholder & Chairman )

2. Dr. Mahmood Ahmad ( Chief Executive )
3. Mr. Muhammad Naseem ( Independent Director & Chairman AC )
4. Mr. Ilyas Sharif ( Director )
5. Mr. Shahzad M. Husain ( Director )
6. Mr. Zafar Aziz Osmani ( Independent Director & Chairman HR )
7. MOHAMMAD SAEED ( Independent Director )
8. Sohail Osman Ali ( Minority Shareholder & Independent Director )

Number of Employees:
According to annual report 2019 of Berger paints, they have currently 737 employees working
for them. In 2018, it was more than 1000. Because of overall bad conditions of businesses in
Pakistan, decrease in their revenue and increase in expenses led them to the decision to lay off
their employees.

Number of Departments:
There are multiple departments important for the daily operations of the company. The
departments are as follows.

1. Human Resource Department:

This department is responsible for multiple things like hiring of employees, increment in
salaries, training of employees. Apart from that he is responsible for making policies for the
betterment of the company. The main purpose of HR department in any firm is recruitment
and training of employees.
2. Production Department:
Production area is responsible for turning inputs into finished goods through a series of
production processes. Production manager makes sure that all the inputs and raw
materials are provided so that it should be done smoothly.

3. Sales Department:
Sales department has multiple purposes like planning and developing strategies for the
sale of the product. Similarly, they are the one who set goal of their sales and then
monitor and evaluate the result. Depending on results, they develop their strategy again.

4. Marketing Department:
The marketing department of any firm is responsible for promoting the products,
segmentation of market planning the strategies for increasing the sales, finding new
customers and reminding existing customers that you are still in business. It organizes all
the activities that are concerned with promotion.

5. Accounts Department:
Accounts department is responsible for recording and reporting all the cash flows of the
company. It is mandatory for every public limited company to have a accounts
department because it has shareholders money. They record all the transactions on daily
basis and present it in their annual report every year.

6. Technical Services Department:

Technical service department is responsible for the advancement in technology. In case
of Berger, it watches over new technology advancements in paint industry, customer
preferences, use environment friendly chemicals and other advancements in machines.
 7. Procurement Department:
Procurement department also known as purchase department is responsible for keeping
the record of all the raw materials and inputs necessary for the production process. It
manages all the supply needed for production timely.

8. Quality Control Department:

As the name suggest, this department look for the quality of finished goods. It ensures
that the manufactured product adheres to defined set of quality and meets the requirement
of the customer.

These are major departments that are present in Berger Paints but there are often smaller
departments responsible for their other few operations.

Format of Work:
There are typically two formats of work in every organization i.e. centralized and
decentralized. It depends on the environment, culture and point of view of top management
which kind of format they want to adopt. If we talk about Berger paints, it is a centralized firm
because job description of employees is defined. All they have to do is to perform their task
given by the management. They do not have decision making power to take major decisions on
their own. Top management assign them task which they have to do.
 Part 3: PESTEL Analysis

PESTEL Analysis of Berger Paints:

1. Political:
The policies that Government imposes have either positive or negative impact on the
organization. The policies formed by the government should also be stable and strong.
Corruption in the organization and in government has bad impact on the decision making
as well. If the country is politically unstable, the business will be unstable too.

2. Economic:
The economy of the country is a major factor for the Growth of the Organization. There
is a direct relation between organization and the economy of the country If the economy
of the country is stable then the organization will work more efficiently and can earn
more business. In case of the economy is not good it will have the bad impact on the
industry.

3. Social:
Social factors are also very important for the organization to stay in the competition in
the market. In case of Berger Paints, the first thing is age matters a lot for the choice of a
paint color that represent a lifestyle and attitude of the people. Everyone has their own
preference, so they have to maintain their colors accordingly.

4. Technology:
Technology is a key to success for every organization. If the organization is more
innovative they will be more efficient and profitable. This way they can reduce their
expenses which will help them achieve their goals.
 5. Environmental:
Environment of the country matters for the organization. If the weather of the country is
unbalanced then there should be a proper storage or warehouse where they can store the
paints. Paints should be environmental friendly which will not harm environment in any
way.
6. Legal:
Each and every law is important for the company to follow. By following the laws the
organization maintains a level of quality for the paints. Similarly the company should pay
their taxes and obey the law of the country in which they are operating.

Part 4: Distribution and Marketing

Product Line and Product Mix:

Product Line Product Mix

Vogue Series Glazed Finish, Marbleized Finish, Interior
Texture, Sand Finish, Exterior Texture
Interiors Silk Emulsion, Elegance Matt Emulsion, VIP
Plastic Emulsion, Easy Clean Emulsion, SPD
Semi Plastic Emulsion, New economy
Emulsion, VIP Matt Emulsion Max Pro
Exterior Weather coat Acrylic Exterior Finish, Weather
Pro Acrylic Exterior Emulsion
NU Series NU Emulsion, NU Enamel, NU Putty, NU
Prime Seal
Wood and Metal Elegance Long life Enamel, VIP Super Gloss
Enamel, All-rounder Matt Enamel, Synthetic
Enamel
Timber coat Range Timber coat Sanding Sealer, Timbercoat
Polyurethane Color Varnish, Timbercoat Clear
Wood Lacquer, Timbercoat Polyurethane
Lacquer, Timbercoat Thinner
Ancillary Products Plastron Wall Primer, Red Oxide Primer,
Berger Wall Putty, Synthetic Clear Varnish,
Synthetic Undercoat, Duxbak, Water based
 Primer, Aluminum Paint, Chlorinated Rubber
Base Paint

Marketing Campaigns of Products:

The advertising is a very important strategy for Berger paints. The company did allot of
campaigns to promote its new and innovative products. Berger Paints have done many sales
advertisements on TV and newspapers to attract the customers and put their quality at first to
build a strong trust and loyalty among their customers Berger Paints is also organizing peel and
win contest by providing tokens in the paint gallons. Berger Paints sponsors various International
sports and also has taken part in social responsibilities like Polio immunization programs and
providing education to the poor children of the poor class families.

Berger uses different platforms for marketing of its products. These platforms include social
media, magazines, TVC Airing, Bus Shelters, Consumer Magazines, SMS Marketing and
Society Branding. They have also painted walls for in different cities for their marketing.
According to annual report 2019, they have done their marketing through these platforms.

1. TVC Airing:
TVCs were aired on the following channels:
 ARY Digital
 PTV Sports
 HUM TV
 Dunya News
 City 42
 SAMAA
 AVT Khyber
 2. Print media:
Ads were also printed on newspapers of

 Dawn
 The News
 Jang

3. Social Media:
Weekly sponsored post and cover photos of product based ads were posted on official
accounts of Berger on Facebook, Instagram, Pinterest, Youtube, Daily Motion and
company website.

4. Consumer Magazines:
Ads were posted in consumer magazines like Hello, Aurora, News Line, Page 3, Herald,
Visage, Libaas, and Niche etc.

5. Truck Air Child Finder:

Their most unique way of marketing is truck air child finder. In this campaign, they paint
a missing person on the back of truck which will help find missing persons. According to
their annual report 2019, this campaign has helped 5 missing children to get them to their
home. Similarly, their campaign of painting bridges in different cities is also a part of
marketing and Corporate Social Responsibility (CSR) combined.

Distribution Channels:
The distribution channels used by Berger Paints are 160 stock points which distribute
their product among 25,000 dealers. To help customers, a sales team is present in all locations to
provide help and consultation for the problems faced by the customers. Berger Paints also
introduced a website to help their customers to customize their painting requirements. Apart
from that, they also provided paint calculator which calculates the cost of the paint they are
going to use. The distribution channel of the Berger paints is that after the production the paint is
stored in the warehouse. Then the sales office provides the paint to the dealers and then it goes to
the retailers. That is how the paint is available to the customers for use. Berger paints also offers
direct marketing to cut the cost by eliminating certain intermediate person by providing the paint
to the bulk buyers and largest corporate projects.

Part 5: Recommended Strategy

The long-term targets of an organization are to meet the needs and expectations of its
stakeholders. All the business strategies are aligned with those needs and expectations. Among
various stakeholders of an organization, its employees are its one of the most valuable assets and
the organization needs to recognize their needs and address their concerns. Since the motivation,
performance and morale of the employees is directly related to the organization performance,
therefore low motivation and insecure employees will lead to decline in organization’s
performance. So in order to address the insecurity and low morale of the employees in this
prevailing situation, an organization can adopt following strategies.

1. Leadership Style:
Successful organization has participative management and leadership rather than
mechanistic approach. Therefore participative style of leadership is more appropriate to
encourage the morale of the employees.

2. Organization Structure:
Organization structures are based upon long term planning and are well in place.
However, flatter or horizontal organization structures have better communication and
information flows. So in particular situation more efficient information flow and
 communication will not only improve decision making but also be less stressful for
employees.

3. Policies to increase efficiency:

Efficiency of employees can be increased through clear communication of planned
targets and encouraging the efforts of the employees by the top management.
Announcing financial and non-financial awards can also help motivate them.

4. HR Policies:
Human Resource is a department where the confidence of the employees lies in an
organization. HR can plan various activities such as celebrating birthdays, efforts of
employees or any event to release the stress of the employees and let them feel to be a
family.

5. Ethical Strategies:
Sense of recognition gives encouragement to employees. Therefore employees can be
directly motivated through them. Their rights must not be exploited.