1

INTRODUCTION

The project aims to analyze the organizational behaviour of. Pakistan International

Airlines .It is the public-sector organization.

A study of the organization comparing and contrasting on various parameters of

Organizational Behaviour has been carried out in the report. This has been done to analyze

the impact of individuals, groups and structures on behaviour within the organization for

the purpose of enhancing the effectiveness of the organization.

Thus, the report evaluates the organizational culture, leadership styles, employee

behaviour, development and motivation, group behaviour. After a thorough analysis,

recommendations have been proposed to improve the efficacy of the organization.

 2

BOARD OF DIRECTORS
Ch. Ahmed Mukhtar
Minister for Defence and Chairman - PIA

Syed Naseer Ahmed

Malik Nazir Ahmed

Mr. Javed Akhtar

Lt. Gen (Retd) Syed Athar Ali

Federal Secretary Defence

Capt. Mohammad Aijaz Haroon

Managing Director – PIA

Prof. Mian Ijaz ul Hassan

Mr Mubashir Iftikhar

Mr Husain Lawai

Mr Shaukat Ali Rana

Mr Salman Siddique
Federal Secretary Finance

Mr Muhammad Shuaib
Secretary-PIA
 3

MANAGEMENT
Managing Director
Captain Mohammad Aijaz Haroon
Chief Financial Officer
Mr. Arif Majeed
Director - Corporate Planning
Mr. Shahnawaz Rehman
Director - Engineering and Maintenance
Mr. Maqsood Ahmed
Director - Finance
Muhammad Ziyad A Syed
Director - Flight Operations
Capt. Shuja Naqvi
Director - Information Technology
Mr. Shahid Sarwar
Director - Human Resource & Administration
Mr. Hanif Pathan
Director - Marketing
Mr. Salah uddin
Director - Precision Engineering Complex
AVM Muhammad Kamal Alam Siddiqui
Director - Procurement, Logistics and Food Services
Mr. Imran Ahmed Khan
Director - Training and Development
Mr. Dilawar Farid Baig
Director
Mr. S. Kamran Hasan
 4

HISTORICAL PROFILE

PAKISTAN INTERNATIONAL AIRLINES

Pakistan International Airlines (PIA) is a national airline, operating passenger and cargo

services covering eighty-two domestic and foreign destinations. Established in 1955, PIA

has a vast experience in the airline industry of Pakistan with a large fleet of aircrafts. The

fleet size is forty.

PIA is a huge corporation with more than 17,000 employees. This organization is divided

into following departments: Human Resource and Administration, Marketing, Corporate

Planning, Information Services, Finance, Flight Services, Flight Operation, Engineering,

Procurement and Logistics, Customer Services, Training and Development, Quality

Assurance.

The organogram of the organization follows, with the Chairman at the top and directors of

departments reporting to him. The structure is centralized with the top-level management

making the decisions.

 5

THE DEPARTMENTS INCLUDE:

 Human Resource and

Administration

 Marketing

 Corporate Planning,

 Information Services,

 Finance

 Flight Services

 Flight Operation

 Engineering

 Procurement and Logistics

 Customer Services
 6

CULTURE
The distinguished culture is determined by the vision and values communicated

throughout the structure and amongst people. Since Pakistan International Airlines is a

bureaucratic organization, so the culture is similar to that of any government organization.

Vision of PIA
‘To be a world class airline exceeding customer expectations through dedicated

employees committed to excellence.’

Corporate Mission
As a Symbol of National Pride, We aspire to be a Choice Airline, Operating Profitable

on Modern Commercial concepts and Capable of Competing With the Best in the

International as well as Domestic markets.

SEVEN CHARACTERISTICS OF ORGANIZATIONAL CULTURE

 7

CHARACTERISTICS PIA
INNOVATION AND RISK TAKING Low
ATTENTION TO DETAIL Low

OUTCOME ORIENTATION High

PEOPLE ORIENTATION Low

TEAM ORIENTATION High

AGGRESSIVENESS Low

STABILITY High

The results show that PIA focuses more on the goal rather than means to achieve it the

characteristics and values form the organizational structure which determines the

behaviour of employees and the effectiveness of the organization.

 8

Values of PIA

Revenue composition
9
 10

MAJOR COMPITITORS
 11

SWOT Analysis-Internal Factor

 Strengths
 Leading Market Position
 Brand Recognition
 Superior Operating Structure
 Network Presence
 Hub airport at Karachi

 Weakness

 Formulation of Govt. Rules

 High dependence on Passenger Revenues
 Debt
 Reliance on Oil Prices
 12

SWOT Analysis-external factor

 Opportunities

 Having the maximum route and Fleet

 Growing demand for low cost Airlines
 Customer loyalty
 Shifting customer needs
 Industry Recovery

 Threats

 High Interest Rates

 Accidents
 Strong Competition by Air-blue
 Interest and foreign currency exchange rates
 Decline in airline industry
 13

PIA TRAINING CENTER

A PIA Training Center (PTC), operating in Karachi, conducts training courses to augment

the skills of employees while the scope for enhancing their attitudes (beliefs and

emotions) through these courses is meager

They have one of the most advanced Airline training infrastructures approved by local and

international regulatory authorities such as CAA, ICAO and IATA.

Functions:

• To develop and conduct quality training as per the requirements

of user departments and regulatory authorities
• To maintain centralized training database of all PIA personnel
for organizing HR activity
• To maintain regular contact with vendors regarding new
functionalities, modifications and additions to update training
programmes and train the instructors.
• To formulate criteria which will enable the training of PIA
personnel to achieve excellence in their respective fields/functions
• To conduct courses, workshops, seminars, workouts,
conventions, and to present papers so as to make PTC prominent in
aviation training, particularly in this region

Training has been offered for PIA employees as well as for other airlines' staff intending

to work, or already working as members of the cockpit and flight service crew, as

passenger service and marketing staff, and as mechanics and engineers, etc. It was in 1960

that all training was amalgamated under one roof at the Hotel Midway House, Karachi.

The Centre was moved to its present premises in October 1975.

 14

Details:

Specialist instructors are assigned at the Centre for imparting rigorous training to those

who fly, and to those who service and maintain various types of aircraft (B-747-200, A-

310, A-300, B-737, F-27, Twin Otter, B-777). The training aids and equipment used are

the latest. The methods of knowledge and skill transfer, adopted at the PIA Training

Centre, are varied all pragmatic and useful. Classroom lectures are augmented by group

discussion, observations, experiments, simulations, case studies, etc. Study tours to a

number of PIA facilities are regularly conducted and seminars on topics of general interest

are frequently convened

During the past, for many years the PIA Training Centre has also been instrumental in

Rendering training to a large number of pilots, engineers, flight stewards/stewardesses,

Traffic and sales personnel from over 30 airlines and associated agencies worldwide,

mostly from Asian and African countries.

We offer the highest standard of aviation training at very economical terms and even the

stay in Karachi is in-expensive.

 15

Training includes:

 Customer Service
 Flight Service
 Marketing
 Marketing Cargo
 Passenger Service

 Engineering & Maintenance

 Apprentice
 Aerospace
 Avionics

 Flight Operations

 Information Technology (CBT)

 16

Courses for Management Level Training

HR Management
Time Management
HR Productivity Management
Stress Management
Change Management
Crisis Management
Risk Management
Conflict Management
Mind Mapping
Problem Solving
Decision Making
Team Building
Negotiating Skills
Effective Delegating Skills
HR Budget
Industrial Engineering
Quality Management System
Organization Development
Safety Management System
Policies & Procedures
Airline Security
Cost Control
Six Sigma
Record Keeping & Office Management
Office Management
Emotional Intelligence
Skills in Supervision
Performance Appraisals
 17

Employee Attitudes:

At PIA, every employee is expected to show complete responsibility through their

attitudes and avoid behavior which clashes directly with the organization’s interest. In

case of deviant workplace behaviour, administrative action is taken against the employee

according to the standing rules of PIA.

All human resource issues are dealt in accordance with the POLICIES AND

PROCEDURES MANUAL VOL. I & II, which deals with every aspect of employee

behavior.

Employee Dissatisfaction:
If PIA believes that dissatisfaction or absenteeism is affecting the productivity level of

employees, then the root cause of such factors is identified. If a genuine reason emerges,

the employee is assisted in rectifying the situation; if not, then the employee might get a

letter of warning.

Employees at PIA can express dissatisfaction through the ‘Suggestion Boxes’ located at

various sites of PIA. Furthermore, quarterly employee co-ordination meetings are held

where all employees can share their views with their bosses and subordinates.
 18

Recruitment and Hiring:

An entire Recruitment and Selection Division is functioning in the HR & Administration

Department. Decisions are taken by the top management of PIA regarding the attributes

required for hiring. An assessment form, based on certain characteristics such as

personality, skills and qualifications, is used to evaluate a candidate. The verdict of the

management is forwarded to the recruitment division which then initiates the procedure of

recruitment and selection.

After difficult circumstances the Human Resource Department is now fully functional and

policies and procedures are now in place. New recruitments with clearly defined levels of

skill and competence in all areas are being made. New inductions both on the management

side and specifically the operational side of cockpit crew, cabin crew and ground

engineers will continue at regular intervals so that the shortages experienced in these areas

are fully taken care. The policy is to promote people from within the airline at all levels.

However, where PIA does not find the relevant competencies they hire people from

outside which is based on market salaries. Salaries of all the employees including

operational crew have been considerably enhanced in an effort to align PIA salaries with

regional airlines over a period of time.

 19

Employee Promotion
During promotions experience, skill, education and past performance of the employee are

considered, however, experience takes precedence over all other deciding factors. PIA

believes that experienced employees have the knowledge and expertise, gained over years,

to handle diverse employees and unprecedented situations.

Communication
The organizational structure of PIA is centralized, therefore decision-making is a time-

consuming process and delays occur in downward communication. Though, it is believed

that the current Chairman is inclined towards a decentralized system, the effectiveness of

such an approach in PIA remains to be seen.

Effective communication is essential in all organizations and it becomes even more

essential in an organization like PIA due to its large size and expanded network. It is

necessary that people from various departments communicate between each other to have

an overall uniformity. Previously fax was widely used to transmit information, however,

with the technological advancement e-mails are used for this purpose. Another mode of

communication is through letters.

 20

Feedback:
Employee feedback is considered important in PIA to an extent as it enables the

management and the human resource department to have an insight on the needs and the

requirements of the employees. Accordingly top management is informed about

employees’ necessities which have led to decisions being made in the favor of the

employees in the past and has also improved overall system of the organization.

Apart from this, any striking idea from employees, if it actually suits the organization

interest is soon adopted and the employee is given due credit for that in either monetary

terms or promotion. This shows the high employee involvement in the organization

culture.
 21

Job Rotation:
At PIA, employees are not rotated amongst various departments unless they request for a

rotation.

Monetary Rewards:
Amid a highly competitive environment, PIA needs to motivate its employees. For this

purpose, ‘Promotion Boards’ are held twice a year. ‘Extra-mile Awards’ are handed over

to the competent employees. An ‘Employee Suggestion Scheme’ gives employees an

opportunity to be vociferous regarding their issues. The three best suggestions are given

monetary awards ranging from Rs.5000 to Rs. 20,000.

Apart from the basic salary, fringe benefits are in the form of Medical Entitlement,

Free/Rebated Air Tickets, Utility Allowance, Rent Allowance and Meals at discounted

rates.

Employee Satisfaction:
Employee satisfaction is essential for the retention of competent employees at PIA. The

management strives to achieve this by promoting employees in next pay groups (move-

over), giving monetary rewards (bonuses) and transferring employees to foreign posts.
 22

Sharing information

Efforts are made by PIA’s management to ensure that employees are exposed to

Information in a manner which minimizes uncertainty amongst them so that they are not

disillusioned. However, information through grapevine disturbs this process at times.

TEAMWORK

In an airline industry almost all tasks are performed through team work and PIA is not any

different. From ticket reservation to the landing of the plane team work is the decisive

factor. Employees work in various teams such as ground staff, cabin crew, flight

attendants, office staff etc. All these teams have different sets of tasks to perform but

cohesion among these teams is necessary to run the day to day operations. Considering the

diverse nature of employees PIA has, it is difficult to make team work efficient so it is

major challenge for them.

 23

FORMAL GROUPS

At present, all unions have been banned in all public/semi-government organizations

under the policy of the government. Disagreement among employees is resolved through

applications and appeals. Some cases may be dealt by the ELT (Employee Leadership

Team), headed by the Chairman.

Influence of groups in decision making

The sheer size of the organization leads to the formulation of various formal and informal

groups at PIA. The informal groups influence the overall decision making process to some

extent due to the nature of the workplace. These informal groups are formed because

many employees have been there in the organization for several years and they share

common interests..
 24

CONCLUSION
Organizational Behavior forms an integral part of any organization for prosperity. Greater

emphasis needs to be laid on controlling and monitoring of organizational behavior

because in the present dynamic environment employees are the key to success in any

organization.

This is mainly due to the varying structures and leadership styles. As mentioned on

various accounts, PIA has a centralized structure. This has caused higher conflicts and

poor management of employees as decisions are made by the top level management

without involving the employees. In addition, this leads to complexities in employee tasks

as it takes more time to reach the information from top to bottom. Due to this bureaucratic

nature of PIA, inefficiencies have crept in and morale of the employees has plummeted

over the years.

Delegation of tasks is minimal at PIA. The current status of employees is less control and

authority over different tasks apart from their own assigned tasks, so employees feel

distant as far as other issues and problems of the departments are concerned.

However, PIA emphasizes on experience. Therefore, the organization has young and

active employees who may lack in experience but not competence. This has increased

productivity of the employees and consequently of the organization.

Both prefer communication through electronic mails. This enables two-way

communication in contrast to the to-down communication at PIA.

 25

The meetings and suggestion boxes at PIA are ineffective; employees feel reluctant to

voice their concerns in a meeting amid others and complaints in the suggestion boxes take

time to reach bosses and therefore, action is postponed.

It has been observed that Pakistan International Airlines fears change. They fear that the

system will become unstable, their security will be lost, and they will not understand the

new process, therefore, will not know how to respond to the new situations. PIA turned its

attention on employees when it faced competition. Otherwise, it was concentrating more

on expansion and profitability: an outcome oriented approach.

 26

RECOMMENDATIONS

PAKISTAN INTERNATIONAL AIRLINES

• DECENTRALIZATION

PIA should decentralize is its structure that would lead to the easy management,

increased motivation, easy access to information and resolution of the conflicts (as

they would be resolved by the immediate manger time span would then reduced).

Since employees issues regarding their behavior would lessen, so it would

ultimately lead to more satisfied employees that would result in enhanced

productivity of the organization.

• EMPLOYEE EMPOWERMENT

PIA should make efforts towards empowering the employees that is going to lead

to more employee participation in the decision making process and also result in

more employee satisfaction and enhanced motivation. Apart from this, employees

would feel more independent to discuss the issues explicitly without hesitation.

This would also enhance team work process at PIA as quality team and cross-

functional teams. The employees will work with more commitment and dedication

and every employee would work to his/her fullest due to increased motivation.

However, with empowerment comes accountability, so it is suggested that while

they empower their employees, there should also be a “controlled

 27

Check’’ on them to ensue the correct usage of power delegated to every employees

within their circumscribed limits.

• OVERHEAD COSTS

PIA should also reduce its overhead costs that are it should mange its resources:

labour more effectively, so that with less input, more out put can be achieved and

the saved resources can be utilized in other areas such as introducing more training

courses for the employees so that the quality of the workforce could be increased.

Hiring the services of expertise can improve the efficiency of their services, so by

saving the overhead costs, they can utilize that money for the expertise services.

So by analyzing the various segments of the organization and making the right

corrections, it can substantially improve the standards of Organizational behaviour.

• TWO-WAY COMMUNICATION

The suggestions of the employees can prove to be very effective in improving the

operations as they are the ones who manage them. Therefore, a top-down approach

should be replaced with two-way communications. In this way, the employees

would feel motivated and valued as they would be included in decision-making.

28