Internship Report On

PIA (Pakistan International Airline)

Submitted by:
Muhammad Adeel Khan (MBLE-13-39)

Class:
MBA Evening 6th Semester

DEPARTMENT OF BUSINESS & ADMNISTRATION BZU

BHADUR SUB CAMPUS LAYYAH
PIA

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Dedication
First, I thank God for His blessings and to reconcile and repaid during these years
that have passed me to get to this stage science, knowledge and culture
I thanks to my Parents on a continuous efforts and giving permanent support to
reach Achievements.

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ACKNOWLEDGMENT
To my parents and friends who were always there by my side to
guide me and give me the courage that I can do the best in my life and
taught me the difference between the good and the evil, for this be my
guide in my life. And to my teachers who are my soul guardians, for
they taught me the very best of their knowledge and experiences.

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PREFACE
It consisted of 6 weeks, spending each week in 6 different departments of
PIA. My internship report contains all the information about my work experience
with PIA, which was established in 2002 and started its operations in Pakistan.
I have covered all my activities performed in the span of 6 weeks in PIA
with my learning detail in the organization. The applications of my class room
learning as I observed in PIA are discussed with respect to each department. In the
end my internship report is accompanied with the SWOT and PEST analysis of
PIA. In the end I conclude with some of my dear suggestions to PIA for its
betterment and my actions which I could have taken IF I were a manager in PIA.

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Table of Contents

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Dedication

02

Acknowledgement

03

Preface

04

PIA Introduction

06

Organization Structure

07

Introduction to Department

08

Financial & Ratios Analysis

12

My Activities in PIA

18

Application of class room learned in Org

21

10

What has internee Learn

23

11

SWOT Analysis

24

12

PEST Analysis

26

Suggestion

29

Being a Manager

31

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PAKISTAN INTERNATIONAL AIRLINES (PIA)

Pakistan International Airlines (PIA) was formed in 1955. It is the flag carrier airline of
Pakistan, based in Karachi. It is the 16th largest airline in Asia, operating scheduled services to
73 destinations throughout Asia, the Middle East, Europe and North America, as well as an
extensive domestic network linking 24 destinations.
Its main bases are Jinnah International Airport, Karachi, the Allama Iqbal International
Airport, Lahore and the Islamabad International Airport, Islamabad/Rawalpindi. The airline also
has secondary bases, including Peshawar International Airport, Faisalabad International Airport,
Quetta International Airport and Multan International Airport, from which it connects the
metropolitan cities with the main bases, the Middle East and the Far East. The airline is owned
by the Government of Pakistan (87%) and other shareholders (13%). It has 19,263 employees (at
March 2007).

ORGANIZATIONAL STRUCTURE OF PIA

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CHAIRMAN PIAC

Secretary PIAC

SA to Chairman

Managing Director

Director Precision Engineering Chief Operating Officer Director Coordination/ SA to MD

Director Airport Services

Director Flight Services

Director Cargo Sale & Service

Director
Administration

Director
Flight Operations

Director Network & Route Planning

Director Finance

Director Marketing

Director Engineering

INTRODUCTION TO DEPARTMENTS
PIA has been divided into the following departments:PIA

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1. Finance
2. Information technology
3. Marketing
4. Cargo Sales & Services
5. Human Resource/personnel

1. FINANCE DEPARTMENT
Finance department is one of the biggest departments in the airline, which is responsible for
provision of efficient and effective accounting/budget. The feasibility of extending financial,
administrative, technical facilities is control by this department. It is also responsible for internal
auditor of PIAC. It has further divisions, which are as under:
Planning and Budget
Funds Management
Accounting
Internal Audit
Revenue Management
All the above divisions are operative in PIA head office Islamabad.
In each station as well in Multan, the finance department is divided into a number of sections

Disbursement section (It deals with the internal finance of PIA region)

Refund section (It deals with the refund payments)

Agency Sales unit (It deals with the sales finance of all travel agencies of the region)

2. INFORMATION TECHNOLOGY DEPARTMENT

The functionality of It department in regional stations of PIa is restricted to only dealing with
the computer and communication related problems in PIA office and at airport. In Multan, IT
officers deal with the IT problems of D.G.Khan and Rahim Yar Khan remotely as well. Files are
transferred through using FTP among other computers and the main server.

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Basically at Multan Airport, There is 2 DXX( cross Connect Circuit) Circuits placed at Airport
1. From Lahore Booking office to Multan Airport
2. From Multan Booking office to Multan Airport
Multan is connected to Lahore and Lahore is connected to Karachi

SABRE, a software, is used for Ticketing and Reservation

AVIVA, a software, is used for cargo purpose

Wireless net:
1. From Airport to I.T Room
2. From Airport to Cargo
3. From Airport to Engineering
4. From Airport to Store
3.

MARKETING DEPARTMENT

It looks after development of Marketing Plans & Policies. This department performs all
marketing functions.
Marketing department in Multan station has three divisions
Sales promotion (with the help of travel agents)
Post Flight Analysis (PFA)
Reservation & Ticketing
o Counter T&R
o Airport T&R
o Web-ticketing
o Through Travel agents
o Home Delivery tickets
o Kiosk Machines

4. CARGO SALES/SERVICE DEPARTMENT

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The cargo sales and service department has the same functionality as of passenger sales and
service. It allows shipment all over the world in PIA network. Cargo rates vary from country to
country. It has the booking of cargo, loading and unloading, refund etc. However PIA has none
of its planes specialized for cargo only. Six categories of goods in cargo are

Business related goods (textiles, accessories, machines etc)

Perishable goods (meat, fruits and vegetables)

Livestock

Gifts

Valuable goods (gold, platinum etc)

Dangerous goods (tools, drugs, chemicals etc)

5. PERSONNEL/HR DEPARTMENT
The entire office procedure revolves around the filing system. In the office terminology, it
connotes a device for holding papers for reference. All papers are kept in two categories wise,
notes and correspondence comprises all communications received and office copies of outgoing
communications. They are arranged chronologically those reaching first, kept at the bottom.
All communications are assigned reference No. The material collected for the sake of
understanding is given in the appendix of correspondence. The whole set is then placed in a large
folder with a folio-sized cardboard. This makes a file all files are registered I the file register.

HUMAN RESOURCE MANAGEMENT FUNCTIONS

Promotion/transfer:

Retirement/pensions:

Leave
o Casual leave
o Privileged leave
o Sick leave
o Disability leave

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Passages/free tickets

Training

Benefits and allowances

Salary
o Pay group I-IV

(it includes the unionized staff)

o Pay group V-IX:

(includes the officers and middle level management)

o Pay group X-above: (it includes g.m; and other higher executives)
o A special pay group is for the managing director, director and pilots.

Performance appraisal

Employees record
Dummy record is maintained for all employees as well as the out-station by the
admin. Dept that are the duplicate of the actual records maintained at the head office.
Microfilms of these records are maintained to avoid loss in case of damage or
misplacement of the written records.

Discipline / penalties
o Decrease in pay
o Demotion
o Discharge
o Suspension
o Dismissal

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Golden hand shake

Career development

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Profit Graph

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PIA

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PIA

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PIA

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PIA

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PIA

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EPS and DPS graph

The price of the share is taken on Y Axis and on X Axis timeline is taken. This graph shows the
EPS and DPS of PIAC in past 5 years

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MY TASKS/ACTIVITIES IN PIA
I joined the prestigious organization PAKISTAN INTERNATIONAL AIRLINES
CORPORATION for my internship on June 22, 2015.I was accompanied by 2 other
internees. The internship was scheduled for six weeks. The schedule was provided to me on
my very first day and i was asked to conduct my activities as per schedule. PIA do not
require from internee to work like staff. For internship trainees briefing and observation
method is used to train them. The detail of my activities during this program is as follows

1st Week Activities in FINANCE DEPARTMENT:

I made entries in COSSAP (Corporate Standard Station Accounting Package ) System for
refunded tickets 16-31/05/09.
They showed me the annual report of 2006.
They taught me the format of their Bank Reconciliation and showed us BR for June 1-16.
They showed me their monthly Trial Balance (Journal Voucher) of PIA Multan
They briefed me about PIA Bank Accounts (Two Types).
1) Impressed/Disbursement Account(122)
2) Collection Account (121).
They briefed me about types of Credit(3 Types)
1)

Government Credit (APW and TAC) for army, navy and PAF.

2)

Commercial Credit

3)

Forced Credit for Agencies.

2nd Week Activities in HR DEPARTMENT

Introduction to the PIAs HR department
I worked on HR software TMS ( Time management system)
Function: Online employee record keeping
I recorded the approved leave applications in
1) Leave management (casual/sick/privilege Leaves)
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2) Payroll management (absentees/meal allowance/shift allowance/over time/lunch

guard days)
And meal shifts
I worked on the manual attendance registration marking
a.

Presents

b.

Weeks offs

c.

Days offs.

d.

OCS (out station service)

e.

Shifts

f.

Leaves

g.

Absentees
I checked mails and replied to them as directed by my supervisor

I mailed a complaint against frequent server errors of TMS

I checked & printed mail by DGM HR ( Deputy General Manager) regarding

an internal audit Excessive Manpower In Multan
Made entries in the Dummy employee record files for
1)

Employee ticket concession (Domestic/International)

2)

Leave entries for employees in DGK & RYK

3rd Week Activities in Information Technology Department

Mr. Imran Afzal briefed me about the I.T operations of the PIA, that how it is connected and
how operations are held.
I made computerized document for
o Source 53 ( Loans & Disbursement)
o Source 55 (amount adjustment/change advice)
I worked on a Computer Named DX 2000MT
HP S/n SGH5070147
P/n

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PG984AV

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Installed Software (Ms-Office)

4th Week Activities in MARKETING DEPARTMENT

Direct Sales Promotion-I Observed contacting regular individual clients through direct
meeting & phone calls and observed contacting business houses where PIA finds the best
input
Bank Settlement Plan-I calculated the 35 days average total sales of travel agencies. This
amount totals their bank guarantees for IATA.
I made the fortnightly sales report (01-06-09 to 15-06-09) of all travel agencies.
I made the monthly sales report (01-05-09 to 31-05-09) of all travel agencies
Post Flight Analysis-I calculated the percentage, average and variance of per flight and
weekly usage of domestic flights from Multan

5th & 6th Week Activities In CARGO DEPARTMENT

I was briefed about the cargo procedures

Cargo rates
Cargo handling procedures
Cargo prioritizing
Cargo packing (I watched them packaging goods)
Cargo carriage

APPLICATION OF CLASSROOM LEARNING IN ORGANIZATION

I have seen many of my classrooms learning to be applied in PIA. Of course PIA is a
typical commercial organization having its hands in all the business administration disciplines
i.e. marketing, finance, human resource management, information system, administration,
management etc. As I got rotated in all major departments of PIA, I came to see my concepts to
be applied practically there.
MARKETING DEPARTMENT:

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 I observed aggressive market capturing techniques practiced by the travel agents there,
who are at the same time competing among themselves for gaining even a single
customer.

Similarly I saw the marketing officers there dealing with the ethical and unethical both
kinds of tactics adopted my travel agents in their business with PIA.

There are number of possible distribution channels used by PIA viz direct (e-ticketing,
counter sales, home delivery) & indirect (travel agents).

And for retaining the loyalty of their frequent buyers, PIA has established awards plus
system for granting reward points on their flights
FINANCE DEPARTMENT:
In finance all the procedures were same as I have read and exercised in accounting &
fianc.
PIAs annual report is updated on quarterly basis by head office
Proper budget is allocated to each PIA station by head office
There is daily bank reconciliation of PIA on its accounts which are of two types i.e.
disbursement & collection account.
PIA deals with three types of credits
I. Govt. credit for giving concession to govt. employees
II. Commercial credit on credit cards
III. Forced credit for defaulted travel agents topping

HUMAN RESOURCE DEPARTMENT:

HR department of PIA completely coincides with the literature of HRM.
PIA is carrying out class-room, on the job, job rotation and simulative training
However there is sometimes recruiting carried out on non-merit basis
HR evaluation system is very good, few times back they were using annual confidential
report method by an appointed senior but now they are using bell curve methodology.

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 Each and every transaction in PIA is recorded both manually and electronically through
their specially developed software systems
INFORMATION TECHNOLOGY DEPARTMENT:
This is not a complete department as such in PIA stations. But 2-3 IT officers work in
each station
IT officers are specified to deal with any type of IT related problem. They have a very
well established network of computer
PIA has bought its own anti-virus system and developed specialized software for each
department i.e. SABRE,COSSAP & TMS
CARGO DEPARTMENT:
In cargo I have seen highly specialized goods assortment.
Careful packaging and carriage of shipment goods

There was an air of laziness in cargo department as they were dealing with non-living
objects might be.

WHATS HAS AN INTERNEE LEARNT?

As an internee PIAC was a great experience for me who not only provided me an
opportunity to observe difference between theory and practice. This experience also broadened
my vision and confidence.
As an internee I spent good time in learning and was rewarded for my best efforts, learnt to deal
with different situations, had experience of organizations working environment which affects an
employee performance and attitude towards work, had good time in learning. Confidence, on
time decision making, consistency, hard work, team work, seeking success out of dark,
innovation, creativity, organizational survival and customer handling techniques are the key
learnings out of my job And I would like to say that it will be one of my best skill that would
remain with me and help me in the coming life which offer many challenges. The behavior of a
government organization is totally different when it comes to profitability and existence. I learnt
the deep-rooted causes of PIAs financial losses. Its main reason is the government obligations on
its flight schedules which are un-profitable for the company and the un-necessary government
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intervention in its ownership and operations. It seems that whatever PIA is earning it is just
sufficient for fulfilling the demands of PIAs owners. I would like to highlight this, that my
experience with PIA was very memorable and full of learnings, where I found a lot of positive
changes in my attitude, learning and behavior

SWOT ANALYSIS
STRENGTHS
Only national airline and the only flag carrier airline of Pakistan
Measurable well defined goals and objectives
Provided services for Hajj and Umrah
People oriented organization
Govt. sponsored/protected organization
Direct access to the destinations
Monopoly in the domestic routes with highest market share in domestic routes
Booking Offices in all major cities both at domestic and Int.

Electronic ticketing by web and through SMS

WEAKNESSES
Lack of professionalism
Low level of commitment for the organization
High fares as compared to other airlines
The upper management not belongs to the airline
Sometimes much Govt intervention
Promotion on seniority basis
Weak rewards and appraisal
Less effort in the field of marketing
Poor quality of food/service on board specially in domestic flights

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 Old aging fleet of PIA causing higher operating cost.

Over recruitment

OPPORTUNITIES
PIA has potential market in Middle East if PIA upgrades its fleet.

PIA has largest domestic network and by proper route planning PIA can generate huge
amount of Revenue with higher profit.
PTDC provides favorable market for domestic as well as international sectors for the airline
PIA can generate more revenue by attracting customers through Web and Mobile
Reservations system.

THREATS
Negative rising perception about the country, regarding terrorism.
Political instability and law and order situation.
Rising fuel prices in the world.
Over staffing at all levels
Frequently rising Airlines fare
Fast growing domestic and international competitors
Effective promotion strategies adopted by other competitors like Emirates and Shaheen anr
Airblue.

PEST ANALYSIS
The macro-environment includes all factors influencing a company that are not within its
control. These include political, social, economic and technological factors. These are known as
PEST factors.
A technique of analysis of the macro environment is PEST analysis. Environmental analysis
should be continuous arid precede all aspects of planning. Since the airline industry is very much
influenced by changes taking place in the environment and has undergone rapid and dramatic
changes during the last decade, this analysis is especially important for PIA.
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POLITICAL FACTORS:
Political factors always have a great influence on the way businesses operate in the airline
industry and the spending power of customers. In recent years it has been observed that
government played an active role in increasing competition in the airline industry. A number of
new airlines such as AirBlue and JS Air have been awarded licenses to enter the domestic
market.
Pakistan has achieved some political stability in recent years. If the management of PIA believes
that the present government will perform well (consistently), then there will be more investment
in the form of purchase of new airplanes and latest technology. The over all industry will grow
resulting in more luxurious and comfortable flights. With the military takeover government
policies have become more liberal.
ECONOMIC FACTORS:
Currently, Airlines industry has three major players: Pakistan International Airlines, an
Airblue, Aero Asia and Shaheen Airlines. Their target market includes domestic travelers as well
as Pakistanis living abroad particularly in the UK and USA. These countries have strong
economies coupled with high purchasing power. Customers purchase behavior depends very
much on prices of the competing airlines as well as services offered. As inflation rate is unstable
in Pakistan, spending power of consumers has effected in the long term. In fact growth in
Pakistani economy has resulted in an increase in spending power and has positively impacted the
airline industry.
Economically, the new millennium has been highly volatile; the September 11 attacks
revolutionized the whole world. Consequently, there was a global depression in the North
America, South America, Australia and Europe. However, in Asia especially Pakistan the effect
in the short term was otherwise. The economy began to boom because of greater remittances
from abroad and whole sum immigration by expatriates. As a result, demand for air travel in
South Asia rose.
Economic conditions of Pakistan are however improving. PIA has cost a advantage over
its competitors because of its newly acquired, improved, long distance aircrafts from Boeing
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which give longer range and better fuel economy than any other jet currently produced. This cost
advantage is a barrier to entry for new firms. However, this cost advantage will not be significant
on domestic routes.
SOCIAL FACTORS:
The social arid cultural influences on business vary from country to country. The social
structure of Pakistan is closely tied. The trend is now changing as the general public is educated
and is pursuing professional goals. Customers are more aware of market conditions and available
options and want to get best value for their money.
They spend considerable time and money on entertainment hence increasing the need of in-flight
entertainment systems. Also, word of mouth has a significant impact in the use of airline
services.
Hajj attracts a huge number of customers. The social environment of Pakistan is turning
liberal with the new regime. The initiative to automate check-in and ticket booking process might
not be very popular with the general public (even educated population) is still technology averse.
E-ticketing might also face significant challenges as consumers are generally reluctant to
provide their credit cards information over the phone and the internet. The consumers, however,
have a warm reaction to the prospect of less costly but quality service flights.
TECHNOLOGICAL FACTORS:
Technology is vital for competitive advantage and is a major driver of the airlines
industry. Major technological changes are taking place in the airlines industry with innovations
in the reservations and booking systems. In-flight entertainment systems and auto check in
counters are two examples of such innovations. Internet plays a key role in e-ticketing as
consumer can easily reserve tickets or check the status of the flight.
A key issue will be the extent, to which technological advancements (such as Internet)
impact distribution and cost synergies from industry consolidation, can offset upward pressures
on costs. PIA has always led the path of technological innovations by introducing new
technologies ahead of its competitors such as its auto check-in counters which has helped it gain
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market share. It was the first airline in Pakistan to install Sabre system followed by the market
leader.

SUGGESTIONS
I would like to give certain suggestions for PIAs betterment and profitability.
1.

PIA should adopt transparent policy that employees should be promoted on merit basis.

And Chairman of PIA should be appointed from within the organization. Union should support
it, it will motivate the employees and PIA to work harder.
2.

PIA should adopt good marketing policies so that it will bring higher profit and maximum

utilization of its available resources, Business sector should be attracted to operate at full
potential.
3.

PIA should upgrade its fleet as its causing the airline higher operating cost and PIA is

incurring loss .PIA should purchase new Airplane with twin engines these will reduce the
operating cost of PIA.
4.

Airline should focus on the customers satisfaction, refund process should be quick so that

customer remains loyal to brand.

5.

PIA should not induct new employees till the time they are needed because PIA is suffering

from over manpower.

6.

PIA should give bonus/promotions to the competent employees as there is clear cut lack of

motivation among its employess.

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7.

There should be control on the increase of fares, as mediocre are in majority in Pakistan,

and it is highly difficult for to even think about the air traveling. Management should think over
it and at least they can start a new packaged flight twice a week having 50% fares.
8.

Unnecessary facilities provided to the Government Department should not be discouraged

but withdrawn as it causes financial losses.

Management should focus on computerized system up gradation and implementation.
9.

Management should hire the services of specialized IT personnel for their system

development and up gradation on time.

10.

There should be clear and even distribution of work and only qualified person should be

appointed on jobs.
11.

There should be improved service standards and that should focus on quality.

12.

PIA should offer its services of reservation and seat confirmation with by SMS and flight

confirmation message should also be sent via SMS to the passenger.

13.

PIA should give more incentives to its frequent flyer as it will generate more brand loyalty

by giving better incentives to the customers.

IF YOU WERE MANAGER THERE

If I were a manager in PIA.I would have tried and make many promising changes in the
organization, some of them are as follows:1. I would first of all bring new and energetic blood to the workforce of PIA.
2. I would have asked financial assistance from institutions and contract with foreign
airlines to upgrade existing fleet of PIA, as well as buy new fleet of international
standards, this beginning investment would definitely turn into a long-term gain for PIA.
3. I would make the pay scale for the most important staff of PIA i.e. pilots, air hostesses,
marketing heads, so much competitive that they wont drain their skills from PIA by
switching to other organizations.
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4. I would arrange most efficient training program for PIA representative staff.
5. I would try and uproot the hard-woven practices of a common government organizations
legacy such that absenteeism, free riding, laziness, corruption, family line promotions etc.

References
www.piac.com.pk
www.wikipedia.org
www.airliners.net

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