PAKISTAN INTERNATIONAL AIRLINES CORPORATION

Prepared for Course: Principles of Management

PAF KIET

Prepared by

Hashaam Maqsood

Kamran Sajid

Shayan Alam

Yassar Ilyas

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 Table of Contents

S. No Contents Page No.

1. Introduction 3

2. Organizational Culture 7

3. Mission & Vision Statement 9

4. Organizational Structure (Organogram) 10

5. Quality and Style of Leadership. 11

6. Level of Motivation 12

7. Human Resource Management and Organizational Development 13

Practices

8. Control Processes and Management of Operations 14

9. Organization’s Current Dilemma 17

10. Conclusion 18

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 INTRODUCTION

Pakistan International Airlines was established in 1954. The concept of a National Carrier was conceived

even before the creation of Pakistan. On 23rd October 1946 Orient Airways was established and Mr.

M.A. Ispahani was its Chairman. Four Douglas DC-3s were purchased from Tempo of Texas in February

1947 and operations commenced on 4th June 1947.

The initial routes were Karachi-Lahore-Peshawar, Karachi-Quetta-Lahore and Karachi-Delhi-Calcutta-

Dacca. By the end of 1949, Orient Airways had acquired 10 DC-3s and 3 Convair-240 aircraft.

Eventually, in 1955 PIA and Orient Airways merged to form Pakistan International Airlines Corporation,

in order to operate under the PIAC Act 1956.

International operation started in 1955 with a service from Karachi to London via Cairo and Rome. PIA

wet-leased a Boeing 707 from Pan American airlines, thereby became the first Asian airline to operate jet

aircraft. With the newly acquired aircraft, the airline introduced its first trans-Atlantic route Karachi-New

York via London in 1961.

The Ground Training School (GTS) now known as the PIA Training Centre, was first conceived and

developed during 1961-62. In 1962, it expanded its fleet by placing orders for Boeing 720s, Fokker F27s,

and Sikorsky helicopters. PIA started flying to Beijing in 1964, becoming the first airline of a non-

communist country flying to the People's Republic of China. Being the pioneer in a lot of aviation and

technological sphere, PIA stood as a bench mark for the rest of the airlines in those initial days of aviation

industry.

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 PIA installed Pakistan's first computer, an IBM1401, in 1967. A new Jet Hangar for Boeing aircraft was

completed and commissioned in 1968. PIA's first Engine Overhaul Shop, located near the Head Office

building, was also completed and commissioned around this time. Boeing 747s were introduced in the

fleet in 1975. It was like you name it and PIA had it. Popular Green & Gold aircraft livery was introduced.

During this decade PIA was regarded as Asia's best airline. PIA provided technical and administrative

assistance or leased aircraft to foreign airlines including Somali Airlines, Air Malta and Yemenia.

Although the glory of PIA is lost in the past few decades yet the sparks of glory remains in the core of

the airline. In further chapters we will discuss the pros and cons of PIA from various perspectives.

CURRENT FLEET of PIA consists of 3 types of Wide body Aircrafts, 1 type of Narrow body Aircraft

and also a turboprop type. The details are as following:

 9 x BOEING 777 AIRCRAFTS:

PIA has a mix of Boeing 777 aircrafts. The aircrafts are powered by one of the best and most powerful

engines of the world the GE-90 TURBOFAN ENGINE. The fleet consists of 4 Boeing 777-200

ER(Extended Range) aircrafts having seating capacity up to 329 seats. Next is the Boeing 777-200

LR(Long Range) of which PIA was the LAUNCH CUSTOMER, which can fly non-stop from USA

to Pakistan thus saving huge amount of layover time and fuel as well. The LR however has lesser

seating capacity which is around 240 seats. The third type is the 777-300 ER(Extended Range) which

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 is one of the most successful airliner in the world today having seating capacity upto 400 seats. The

Aircrafts are mostly used for Long Haul flights that are To-From US,CANADA and other

EUROPEAN Countries. It is the replacement PIA has planned for its aging Boeing 747 fleet(to be

grounded soon)

 1 x BOEING 747 AIRCRAFT:

PIA is left with only ONE Boeing 747-300 aircraft. The aircraft is powered by ROLLS ROYCE RB-

211 TRIPLE SPOOL ENGINES. PIA mainly uses this aircraft for HAJJ operation but due to heavy

maintenance costs and fuel expenses incurred, PIA will ground the only 747 by the end of 2014. The

aircraft however has seating capacity up to 503 passengers.

 6 x AIRBUS A-310 AIRCRAFTS:

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 The third type of Wide body Aircraft which PIA operates is the Airbus A-310 aircraft series. PIA has a

mix of these aircrafts powered by the GE-CF6-80C2 ENGINES and PRATT AND WHITNEY PW-

4000 ENGINES. The aircrafts has seating capacity up to 220 passengers and is mostly used on

domestic and middle eastern as well as some European routes.

 3 x AIRBUS A-320 AIRCRAFTS:

Recently PIA inducted 3 Airbus A320 aircrafts in its fleet on dry lease for 6 years. The Aircrafts are

powered by CFM-56 ENGINES. It is a type of Narrow body aircraft mainly used on domestic routes

within the country due to its economical fuel usage and also flies to the middle east region. Seating

capacity is up to 180 passengers.

 6 x ATR TURBOPROP AIRCRAFTS:

To cater for the airfields where Jets cannot operate, PIA has the ATR aircrafts that are capable of

landing on Short and Narrow Airfields like Turbat, Panjgur, Gwadar and the Northern areas of

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 Pakistan like Skardu, Gilgit and Chitral. The Aircrafts are powered by PRATT AND WHITNEY

PW-127 ENGINES. The seating capacity of these aircrafts is 48 passengers.

ORGANIZATIONAL CULTURE

If we over all look at the organizational culture of Pakistan International Airline there will be many

perspectives from which we will have to analyze the entire scenario. To begin with let us look at the corporate

social responsibility that The National Airline recognizes. In every natural disaster that occurs nationwide or

internationally PIA is in the forefront to help the diseased or the IDPs. As a public sector organization and a

business leader, PIA believes in building strong relationships with customers, partners, employees, and the

communities in which it operates and so much so that Corporate Social Responsibility (CSR) has now

woven into the fabric of daily operations at PIA.

The employees wholeheartedly contribute to their commitment to develop the organization, the communities

in which they function. PIA is proud of its human resource as they in many ways initiate & actively

participate in welfare missions. PIA is gifted with teams of professionals who pursue excellence and deliver

confidence. Irrespective of other failures on operational level PIA has been able to realize vision of social

accountability with a leadership that understands the true meaning of Social Accountability. PIA employees

join hand in hand and work as a team at any occasion when the nation requires. Following are a few pointers

where we see PIA portraying its responsibility at its peak.

1. Boy Scouts Association

2. PIA Planetariums

3. PIA Horticulture

4. Support for Non-Profit Organizations

5. Training and Education

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  PIA Training Center

 PIA Model Secondary School

 PIA Industrial Training Institute

6. PIA Employee Health and Medical Services

7. Corporate Safety & Quality Assurance

Above mentioned are some of the positive domains where PIA has generously put forward its services not

only for the employees but also for the rest of the nation.

A public service corporation with such meritorious records, empathetic vision and such a glory and glamour

has come down to bankruptcy, operational failure and bad name is a major point of concern not only for the

management itself but nation as a whole, as people feel pride in their national carrier. If we critically observe

the downfall of PIA has started after the unnecessary interference of the government. When throughout the

history we observe either Capitalists or Feudalists in power; it is very unfortunate to say that none of

the political leaders of Pakistan have truly been sincere with the nation. As a result we have not only

ruined the existing infra-structure of the country but also added no value it except carrying out a few

superficial projects.

Pakistan International Airline has always been the golden bird for the political party in power. They

not only recruit incompetent people in the airline but also supported them in their evil doings.

Resultantly we can all see the current balance sheet and failed business plan of our National Carrier. Such

activities lead to inappropriate managers without managerial and leadership qualities and thus procrastination

in important management decisions. Political influence, pressures of unions is also the bone of contention

between the policy matters and its execution.

Thus here we see the current position of our National Carrier but personally I still have a lot of hope in PIA as

I still can see a lot of hidden potential.

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 MISSION AND VISION STATEMENT
Vision

PIA's vision is to be a world class airline exceeding customer expectations through dedicated employees,

committed to excellence.

Mission

 Employee teams will contribute towards making PIA a global airline of choice:

 Offering quality customer services and innovative products

 Participating in global alliances

 Using state-of-the-art technologies

 Ensuring cost-effective measures in procurement and operations

Values

 Customer Expectations
Convenience, Caring, and Competitive Tariff

 Service
Personalized and Courteous

 Innovation
Cherishing New Ideas, Translated Into Action

 Cohesiveness
Respect for Individuals, Teamwork, and Effective Communication

 Integrity
Business Ethics, Accountability, and Transparency

 Reliability
Loyalty and Consistency

 Safety
Passengers, Employees, Environment, and Health

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 ORGANIZATIONAL STRUCTURE

CHAIRMAN

S.A to CHAIRMAN

MANAGING
DIRECTOR

DIRECTOR FLIGHT CHIEF FINANCE

OPERATIONS OFFICER

DIRECTOR
DIRECTOR FLIGHT
ENGINEERING &
SAFETY MAINTENANCE

DIRECTOR FOOD & DIRECTOR

FLIGHT SERVICES AIRPORT SERVICES

DIRECTOR DIRECTOR
MARKETING ACCOUNTABILITY

DIRECTOR H.R.A & DIRECTOR MRO &

COORDINATION TRAINING

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 QUALITY AND STYLE OF LEADERSHIP

Pakistan International Airlines has seen many types of management leaders from Air force commanders to

average mediocre political recruit. Therefore the national carrier has = faced several ups and downs in its

tenure. If we look as a whole some Managing Directors have followed Aristocratic style of leadership whereas

some has observed democratic and PIA had to go through the pros and cons of both the styles, as eventually

any management decision directly effects the organization.

On the departmental level all have their own independent styles for example Engineering and Flight

Operations are areas of an airline where there is a lot of pressure and instant decisions are to be taken, here

aristocratic style will suit the best, whereas other departments such as Marketing, Passenger Handling,

Airport services , Training & Development and so on, should prefer democratic style since it works best there

for planning and forecasting is possible and are not subject to any technical failure.

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 LEVEL OF MOTIVATION AND MORALE OF EMPLOYEES

Like any other organization’s employees, PIA’s employees are divided into various categories. Some

are satisfied and some are dissatisfied. Although as mentioned earlier Pakistan International Airlines

offers a great deal of compensation and benefits to its employees yet they seek more benefits that

would satiate their esteem needs. Promotion is one of the biggest factors that can motivate an

employee, but since promotion criteria is not transparent in PIA a great many number of employees

have developed negativity and de motivation in themselves. Annual Confidential Reports are not

filled with objectivity; on the contrary, they are subject to political pressures and are CBA influenced.

This practice has brought hard working employees to a greater level of dejection and de moralization. I

personally think that this high time, PIA our national carrier is facing extreme dearth of respectable

reputation and is at the verge of privatization; the management should take some rigorous steps to

streamline the motivation level of the employees as it is bad effecting the airline business.

Only when the internal customers are happy, can be the external customers

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 HRM And Organizational Development Practices

Every now and then we listen to the news about over employment in PIA and other

national/public corporations in the television channels. Pakistan International is a huge

organization, and can very easily justify the number of employees working in its capacity. The

only problem that the flag carrier faces is lack of guidance from the management’s side. As the

famous phrase that we read in every management book that we read, RIGHT PEOPLE AT THE

RIGHT PLACE is not being practiced in the Airline. Looking holistically, we cannot say that

employees are worthless who are working in PIA but they need proper guidance from the superior

HR management. Well yes we can say that, thorough professionals are rare to be found in such a

prestigious organization as PIA. Workload is not equally divided amongst the employees and there

is no check on the favoritism culture.

Recently PIA management has realized the de motivating factors of the employees and

therefore has started giving attention to their needs with the help of PIA Training Centre (PTC)

and Organization Development (OD) section. Lately mandatory trainings have been started in

liaison with PTC and OD in PIA and Training Needs Analysis (TNA) procedures are also being

re defined.

I believe such steps will definitely bring fruitful results for PIA in future.

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 CONTROL PROCESSES AND MANAGEMENT OF OPERATIONS

Safety & Quality Certifications

IOSA

IATA Operational Safety Audit (IOSA) is basic requirement to retain airline’s IATA membership. PIA is

among the few developing country airlines which are compliant to IATA Operational Safety Audit (IOSA)

requirements and standards since 2005. The standards body for IOSA is based in Montreal, Canada. A typical

IOSA Certification Audit is based on a check list comprising of +950 IATA Standards and Recommended

Practices. Each IOSA certification audit has two years validity and an airline must pass through a series of

periodic recertification audits by IATA approved Audit Organization to retain its IATA membership.

PIA is successfully maintaining its IOSA certification and the current IOSA Registry is valid up to 24th June,

2015. IOSA registration demonstrates PIA’s renewed commitment to meeting the highest international

operational safety standards in critical areas which include:

 Organization & Management System

 Flight Operations

 Operational Control and Flight Dispatch

 Aircraft Engineering & Maintenance

 Cabin Operations

 Ground Handling Operations

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  Cargo Operations

 Security Management

EASA (European Aviation Safety Agency)

EASA is the centerpiece of European Union’s strategy for aviation safety, promoting highest standards of

safety and environmental protection within the aviation industry. Its primary task is to draft legislation and

provide technical advice to the European Commission and to the Member States. EASA part-145 regulation is

adapted by many aviation maintenance organizations.

PIA Engineering & Maintenance is among the very first group of Non-European organizations which

qualified as EASA Part-145 approved maintenance organization back in April, 2004. This has enabled PIA to

provide aircraft maintenance services to European registered aircraft.

The EASA Part-145 approval validity is subject to clearing surveillance audits being conducted on periodic

basis by European auditors. PIA Engineering & Maintenance, has so far, successfully gone through six such

audits. The approval’s renewal Audit is conducted after every two-year period.

PIA Engineering & Maintenance has not only cleared the renewal audit in March 2006, but has also got

extension of their scope of approval which now includes the heavy maintenance on state-of –the-art Boeing

777 aircraft. The scope of approval also includes light and heavy maintenance of Boeing 747, Boeing 737,

Airbus A300 and Airbus A310 aircraft including maintenance on most of their Components at Shop level.

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Quality Management System (ISO 9001:2008) Certifications

At PIA, Customer Focus and Continual Improvement is embedded in the heart of each and every employee,

right from the top to the bottom most cadre. To achieve this aim of enhancing its customer satisfaction, PIA

has undertaken a number of pioneering initiatives throughout its history.

The latest in this series of customer service initiatives is PIA achieving successful certification against the

global benchmark standard ISO 9001:2008 for its entire chain of customer service activities. Starting from the

Passenger Reservations and Ticket Sales / Cargo Sales, , then through to the Passenger Handling Services and

finally culminating in the In-flight Cabin Services; the entire process has been carefully developed to meet the

stringent requirements of ISO 9001:2008 Quality Management System Standards.

PIA achieved the initial ISO certification in the year 2006, and since then it is successfully maintaining all the

certifications through regular independent management systems audits by accredited audit organizations.

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HSE Management System (Health, Safety & Environment)

PIA has been proactive in understanding the needs of time and has launched the Health, Safety &

Environment (HSE) initiative. The objective of this program is to mature the airline’s HSE systems to a level

which will eventually lead to OHSAS-18001 and ISO-14001 certification.

As part of this program, PIA plans to conduct organization wide HSE trainings, development of HSE

objectives, implementation of HSE system procedures and management reviews to assess the continual

effectiveness of the HSE system. These accomplishments will make PIA a safer airline, paving the way for

OHSAS and ISO certifications.

ORGANIZATION’S DILEMMA

Even after giving so much to the nation and the government Pakistan International Airline is facing a

really hard time at the current moment. It stands at the verge of Privatization, as it is completely bank

corrupt. Corruption has eaten up its roots and now it stands nowhere. The aging fleet has nothing to offer

accept a few sectors to be covered. If PIA is privatized it will lose its sovereignty and if it does not, the

corruption will lead to its complete shutdown.

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 CONCLUSION
To conclude we can say that PIA is a fabulous organization and it will rise again only if the employees and the

management running the business become responsible and sincere with the airline. Following are a few

recommendations from our side to our national carrier.

 Recruitments should be done on merit basis

 New Fleet should be purchased with the aid of the government

 Training should be given priority

 Training Needs Analysis should be mandatory

 Proper utilization of man power and resources should be done.

 Transparent promotion policy should be maintained.

LONG LIVE PAKISTAN, LONG LIVE PIA

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