final management report

AT

Pakistan Petroleum Limited

Principles of Management

Management Functions at PPL

SUMBMITTED TO:

SIR AMIN RAJANI

SUBMITTED BY:

Qurrat ul Ain – 7864

Syed Muhammad Ali – 11048

Immad Ovais Rohela – 10990

Misbah ul Haq Siddiqi – 10979

Ahmed Tamjid Aijazi – 10787

Dated: 14th August 2010

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LETTER OF TRANSMITTAL

August 14, 2010

Mr. Amin RajaniCourse InstructorPrincipals of ManagementInstitute of Business Management

Dear Sir:

We have been assigned to draft a report on management functions of an organization, for which we have selected “Pakistan Petroleum Limited”. This report leads us to exploring new horizons of management at Organizational level

Evaluating management perspective of real work environment had been an exhilarating experience for all of us and is going to help in our professional career

We express our deep gratitude to you for giving us such great deal of learning opportunity

Regards,

Qurrat ul Ain

Syed Muhammad Ali

Immad Ovais Rohela

Misbah ul Haq Siddiqi

Ahmed Tamjid Aijazi

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ACKNOWLEDGMENT

We would first like to thank Almighty ALLAH for His Blessings. This report is dedicated to our parents,

without whom none of our accomplishments in life could have been achieved. Their unconditional love

and unending support of our personal endeavors has been a major factor in giving us the strength to

pursue MBA program.

We are very grateful to Sir Amin Rajani– course instructor for Principles of Management, who provided the opportunity to learn the Management domain. We truly appreciate his efforts to make the concepts easy and relevant examples given throughout the course. We would also like to thank our institution for the support and patronage we received.

And last but not least we would like to extend our heartiest thank to the entire PPL team for their support,

cooperation & guidance in collecting the data for completing this project which was of utmost

importance.

Regards,

Qurrat ul Ain

Syed Muhammad Ali

Immad Ovais Rohela

Misbah ul Haq Siddiqi

Ahmed Tamjid Aijazi

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ContentsPrinciples of Management..........................................................................................................................1

LETTER OF TRANSMITTAL............................................................................................................................3

ACKNOWLEDGMENT...................................................................................................................................4

EXECUTIVE SUMMARY.................................................................................................................................7

PPL PROFILE.................................................................................................................................................8

Company overview...........................................................................................................................8

Mission Statement............................................................................................................................8

PLANNING.................................................................................................................................................10

STRATEGIC PLANNING...........................................................................................................................10

TACTICAL PLANNING.............................................................................................................................10

OPERATIONAL PLANNING......................................................................................................................11

SMART CRITERIA....................................................................................................................................12

PLANNING TYPES AND PERFORMANCE.................................................................................................12

Management by Objective................................................................................................................13

SINGLE-USE PLAN..............................................................................................................................13

STANDING PLAN................................................................................................................................13

BUSINESS CONTINUITY PLANNING....................................................................................................13

SWOT ANALYSIS..............................................................................................................................13

COMPETITIVE STRATEGY.......................................................................................................................14

DECISION MAKING CRITERIA.................................................................................................................14

ORGANIZING..............................................................................................................................................16

ORGANIZATION CHART..........................................................................................................................17

Corporate governance...........................................................................................................................18

Centralization / Decentralization...........................................................................................................22

Cross Functional Teams.........................................................................................................................22

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Chain of Command................................................................................................................................22

Span of Control......................................................................................................................................23

Human Resource Management.............................................................................................................23

Training and Human Resources Development.......................................................................................25

LEADING....................................................................................................................................................28

PPL ON LEADERSHIP CONTINUUM........................................................................................................29

MOTIVATING EMPLOYEES AT PPL..........................................................................................................30

JOB SATISFACTION.................................................................................................................................30

PPL’s ORGANIZATIONAL COMMITMENT...............................................................................................31

REWARDS..............................................................................................................................................32

CONTROLLING...........................................................................................................................................34

Control Process......................................................................................................................................34

Establishing performance standards.................................................................................................34

Comparing actual performance against standards............................................................................34

Taking corrective action.....................................................................................................................35

Types of Control at PPL..........................................................................................................................35

Feed Forward Controls at PPL............................................................................................................35

Concurrent Controls at PPL................................................................................................................35

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EXECUTIVE SUMMARY

This report comprises of Management Functions practiced at Pakistan Petroleum Limited

The objective of this report is to study the complete structure of organization with management perspective and to relate the management theory with the practices pursued by the organizations.

The report covers all four functions of management

- PLANNING

Like any other organization planning has been an integral part of PPL’s management both at the strategic and operational level.

- ORGANIZING Organizational Departmentalization, Chain of Command & Span of controls, Hierarchy & Operational Charts were also included in this report.

There are cross functional teams so a good mix of centralized & decentralized decision making is done at PPL.

- LEADING

Supportive Leadership is in practice at PPL with a mix of work centered & people concerned leadership style. PPL stands at middle of the road on Leadership Grid.

- CONTROLLING

PPL has al three controls, feed forward controls, concurrent controls as well as Feed back controls and they keep monitoring the periodical surveys.

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PPL PROFILE

Company overview

Pakistan Petroleum Ltd is Pakistan's Premier E&P Company, the oldest and largestExploration and Production Company in the country was incorporated on 5th June1950 subsequent to the promulgation of the Pakistan Petroleum ProductionRules, 1949 with the main objective of conducting exploration, development andproduction of Pakistan's oil and natural gas resources. PPL inherited all the assetsand liabilities of the Burmah Oil Company (Pakistan Concessions) Limited andcommenced business on 1st July 1952.

PPL and its ex-parent Burmah Oil Company have been active in the subcontinentsince the early part of the 20th century. A total of 239 wells including 65exploratory and 174 appraisal / development wells have so far been drilled whichresulted in the discovery of about 19.90 Tcf gas (both operated and non-operatedleases). A gas condensate/oil field at Adhi with original recoverable reserves of1,253 MT liquefied Petroleum Gas and 39.4 MMbbl of oil/condensate was alsodiscovered by PPL.

Mission Statement

To optimize hydrocarbon production and pursue an aggressive exploration program in the most efficient manner on the local as well as international horizons through a team of professionals utilizing the latest developments in the exploration and production technology and maintaining the highest standards of health, safety and environment protection.

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PLANNING

Planning is the fundamental requirement of any business these days, with the advancement in technology & management sciences, it has rather became an inevitable instance in every organization now days. Following are the levels of plans in PPL.

STRATEGIC PLANNING

Organizations and enterprises are often so preoccupied with immediate issues that they lose sight of their ultimate objectives. That's why a business review or preparation of a strategic plan is a virtual necessity. This may not be a recipe for success, but without it a business is much more likely to fail.

PPL plan is to maintain its position as the premier producer of hydrocarbons in the country and at the same time make a strategic transition to become an international Company, exploiting oil and gas resources beyond the borders of Pakistan, resulting in value addition to shareholders’ investment and to the nation as a whole.

Further, many Planning tools are put to use by planning and coordination department to assist the higher management to form, implement & evaluate their plans. Such as SWOT ANALYSIS.

TACTICAL PLANNING

To cope with these highly competitive market trends and sharply rising oil prices, PPL is endeavoring to revamp its strategic planning processes and adopt a multipronged business strategy of evaluating existing open areas in Pakistan, evaluating blocks applied by other companies, carving new exploration licenses in relatively less explored frontier areas of Pakistan, venturing into international exploration, albeit cautiously and on a selective basis and participating in the

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upcoming bid rounds internationally as well as in Pakistan. The acquisition of discovered reserves, use of latest technology for production optimization from existing discoveries and fields and diversification into other energy related business ventures are some of the other options available for the Company.

Company Strategy is aimed at replenishing, and if possible, enhancing its existing petroleum reserves. The remaining hydrocarbon potential of high prospective areas in Pakistan is limited as most of the low to medium risk / cost areas are attaining maturity and are already held under concessions, while generally, medium to high risk / cost areas are available as open acreages. Given the prevailing high oil prices coupled with rising exploration cost, PPL is gradually venturing into relatively unexplored medium to high risk / cost frontier areas. PPL endeavors to maintain a manageable portfolio of both operated and non-operated exploration blocks and drill about 100 wells in the next 10 years in order to compete in the dynamic exploration environment of the country and achieve the Company’s strategic objective of replenishment and possible enhancement of depleting hydrocarbon reserves.

OPERATIONAL PLANNING

Following are the operational departments that make plans with coordination to achieve company tactical goals.

EXPLORATION

Exploration Department carries out geological and geophysical evaluations of sedimentary basins, regions, exploratory and development licenses in order to be able to predict hydrocarbon prospectively of these entities. One of the major challenges for an Exploration and Production company is to continually replace and ideally enhance its depleting reserves through production.

DRILLING OPERATIONS

The well planning which is the essence of operations is based on the quality and the completeness of the data used which is provided to drilling operations department from exploration, after which the objectives, the time schedules, design, logistics,

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material and services are arranged / firmed up. The exploration process actually culminates with the drilling of wells.

PPL management’s new strategies and enhanced work programme has opened up new prospects for drilling personnel within company in terms of engineered efforts, technical challenges and new techniques / tools improving understanding of drilling operations and solution to the problems faced ahead of drilling tools.

RESERVOIR

Reservoir department carries out optimization of Field Production Rates for maximum ultimate recovery from the oil & gas field, Design Enhanced Oil Recovery Schemes for depleting reservoirs, conduct fully integrated In-House Reservoir Simulation Studies of oil & gas fields, Evolve and Update the Geological & Petrophysical Models of reservoirs in new and developed oil/gas fields.

SMART CRITERIA

PPL 10 year plan is to optimize hydrocarbon production and pursue an aggressive exploration program in Pakistan, through a team of professionals to achieve possible enhancement of depleting hydrocarbon reserves

S – Specific = Pakistan

M – Measurable = possible enhancement of depleting reserves

A – Achievable = through a team of professionals

R – Realistic = Yes, 9 exploratory wells were drilled last

year.

T – Time Bound = 10 year plan

PLANNING TYPES AND PERFORMANCE

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Company has different type of planning as per requirement; below mentioned are the type that are being followed by the company.

Management by ObjectivePPL management set strategic, departmental and individual goal and on timely basis it is ensured that objectives are right, achievable and challenging. If it is found that scenario has changed or goal is not achievable then planning is review at that level.

SINGLE-USE PLANPPL is an E&P company where number of exploratory wells are drilling in different locations and areas of Pakistan for that plans are made which are supposed for the particular well.

STANDING PLANPPL has its 5 fields in different locations of Pakistan where plans are installed and SOP are developed and all concerned staff is familiar with that procedure.

BUSINESS CONTINUITY PLANNINGBusiness Continuity Planning Project focuses on increasing the organization’s ability to recover and restore partially or completely interrupted functions within a predetermined timeframe in the event of a disaster. This is important for increasing the company’s chances of survival, to build confidence amongst employees, and to safeguard shareholders’ trust in terms of providing protection to their investment.

Through Business Continuity Planning, PPL would be able to identify essential functions, identify supporting processes that must be sustained, prioritize those functions, determine essential function resource requirements and develop a plan that ensures continuity of those essential services and functions.

SWOT ANALYSIS

A comprehensive SWOT analysis is conducted to analyze the potential external threats to ensure corporate stability Strategies and convert them into the opportunities. Also the internal factors are held accountable to identify the weaknesses and transform them into strengths through corrective measures and implementation of corporate Growth Strategies

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The analysis of the internal and external environment yields the following Strengths, Weaknesses, Opportunities and Threats for PPL.

STRENGTHS

Core activities include exploration and production of Hydro carbons.

Unparalleled product offering.

Technical Support.

Professional Staff.

Manager leads the management team.

WEAKNESSES

Interaction gaps between various groups.

Weak role of HRM.

Centralization.

Organizational structure.

Employ empowerment.

OPPORTUNITIES

Market development.

Technology development and innovation.

Global influence.

Less competition

25 new block lease.

THREATS

Legislation could impact.

Loss of key Staff.

New technologies, services and ideas.

Political effects.

Law and order situation.

COMPETITIVE STRATEGY

PPL follows Cost Leadership strategy since PPL is an E&P company and selling price of oil and gas are set by government so rates can not be increased or decreased by the company that is why company aggressively seeks efficient facilities, pursues cost reductions and uses tight cost controls to achieve more profit.

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DECISION MAKING CRITERIA

Decision are taken after complete investigation and interaction with all operational departments, following is the example of making any decision pertinent to drilling an exploratory well.

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ORGANIZING

ORGANIZATION CHART: HIERARCHY & DEPARTMENTALIZATION

Following organization hierarchy is followed at Pakistan Petroleum Limited.

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Corporate governance

PPL corporate governance comprises on three teams:

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1. Board of Directors

2. Management Team

3. Board Committees

MANAGEMENT TEAM

There is a management team at the top level for setting strategic directions. The Committee is

vested with the responsibility of reviewing all the operational aspects of the organization,

advising improvements to operational policies and procedures and monitoring the

implementation of the same.

In line with the Company's commitment to achieve and enhance Operational Excellence in all

spheres, the Executive Committee is a forum where Operational Excellence pursuits are

devised, discussed and engineered into action.

This Committee comprises of the Chief Executive / Managing Director and the Functional

Heads:

BOARD COMMITTEES

The Board has established three Committees for effective governance of the Company.

Board Operations and Finance Committee

Board Human Resource Committee

Board Audit Committee

The composition, role and responsibilities of the Board Committees are clearly defined in their

respective Terms of References.

I. BOARD OPERATIONS AND FINANCE COMMITTEE

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The Board Human Resource Committee makes recommendations to the Board for maintaining,

among other things, sound compensation and benefit plans, policies and practices designed to

attract and retain high caliber personnel for effective management of the business.

Terms of Reference

The Terms of Reference of the Board Operations and Finance Committee include review and

recommendation for Board’s approval matters relating to:

Corporate strategy, operational plan and long-term projections.

Financial statements of the Company.

Budgets of the Company.

Progress review of all major projects and status of implementation of approved work

program.

Selection of new exploration areas, farmins and farm-outs and surrender of exploration

blocks.

Strategies for development of existing and new petroleum discoveries.

Cash and fund management policies and procedures.

Major financial commitments of the Company.

The Board Operations and Finance Committee met four times during the year with an average

participation of 100% of its members.

II. BOARD HUMAN RESOURCE COMMITTEE

The Board Audit Committee reviews the periodic financial statements and examines the

adequacy of financial policies and practices to ensure that an efficient and strong system of

internal control is in place.

Terms of Reference

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The Committee makes recommendations to the Board for maintaining (i) a sound

organizational plan of the Company, (ii) an effective employee development programme and

(iii) sound compensation and benefit plans, policies and practices designed to attract and retain

high caliber personnel for effective management of business with a view to achieve set

objectives. The Terms of Reference of the Board Human Resource Committee include review

and recommendation for Board’s approval matters relating to:

Changes in organisation, functions and relationships affecting management positions.

Establishment of Human Resource plans and procedures.

Determination of appropriate limits of authority and approval procedures for personnel

matters.

Review of employee development system and procedures, early identification and

development of key personnel and specific succession plans for senior management

positions.

Review and evaluation of compensation policies, practices and procedures. The Board

Human Resource Committee met four times during the year with an average

participation of 93% of its members.

III. BOARD AUDIT COMMITTEE

The Executive Committee is vested with the responsibility of reviewing all the operational

aspects of the organization, advising improvements to operational policies and procedures and

monitoring the implementation of the same.

Terms of Reference

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The Committee reviews the periodic financial statements and examines the adequacy of

financial policies and practices to ensure that an efficient and strong system of internal control

is in place. The Committee also reviews the audit reports issued by the Internal Audit

Department and compliance status of audit observations.

The Audit Committee is also responsible for recommending to the Board of Directors the

appointment of external auditors by the Company’s shareholders and considers any question

of resignation or removal of external auditors, audit fees and provision by external auditors of

any service to the Company in addition to the audit of its financial statements.

The Terms of Reference of the Audit Committee are consistent with those stated in the Code of

Corporate Governance and broadly include the following:

Review of the interim and annual financial statements of the Company prior to approval

by the Board of Directors.

Discussions with the external auditors of major observations arising from interim and

final audits; review of management letter issued by the external auditors and

management’s response thereto.

Review of scope and extent of internal audit ensuring that the internal audit function

has adequate resources and is appropriately placed within the Company.

Ascertain adequacy and effectiveness of the internal control system including financial

and operational controls, accounting system and reporting structure.

Determination of compliance with relevant statutory requirements and monitoring

compliance with the best practices of corporate governance.

Institute special projects, value for money studies or other investigations on any

matters specified by the Board of Directors.

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The Board Audit Committee met five times during the year with an average participation of

80% of its members.

EXECUTIVE COMMITTEE

The Executive Committee comprises of the CEO / MD, Deputy Managing Director and the

Functional Heads.

The Committee is vested with the responsibility of reviewing all the operational aspects of the

organization, advising improvements to operational policies and procedures and monitoring

the implementation of the same. In line with the Company's commitment to achieve and

enhance Operational Excellence in all spheres, the Executive Committee is a forum where

Operational Excellence pursuits are devised, discussed and engineered into action.

Centralization / DecentralizationThe Organization Pattern of the PPL is based on Team Based Working. Thus a good mix of

Centralized and Decentralized Organizing / Decision making is practiced at Pakistan Petroleum

Limited.

Cross Functional TeamsCross functional teams working is practiced at Pakistan Petroleum Limited i.e. team members

are from different departments. They collaborate with each other to meet a goal.

Chain of CommandPPL staff is divided in two categories

MPT staff

MPT Staff reports to a manager, whereas MPT members work as a team and all team members

are equally held responsible for any given task. Total management staff strength is 964.

Non-MPT Staff

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Non-MPT Staff reports directly to a head or supervisor who is an MPT employee. Total non

MPT staff is 1745.

Span of Control

An effective framework of checks and balances and strict adherence to across-the-board

transparency are at the core of good corporate governance. In line with this key principle, PPL

has evolved a reliable governance structure together with procedural controls and risk-

management policies.

At the apex of this structure is the Board and its functional committees, the composition, roles

and responsibilities of which are defined in their respective terms of references. To further

strengthen the system, a dedicated and fully empowered Internal Audit function is in place to

provide assurance, monitor compliance and address gaps, if required.

Although a narrow span of control is kept at the higher management level but going down, the

team size increases to for 30 to 35.

Human Resource Management

Human Resources look after manpower requirements and ensure that staff contribution to the

business is fully maximized. It operates in partnership with the field locations and provides

advice on human resource management, policies and practices which affect all staff at all

levels.

Staff compensation & benefits, employment policies, remuneration surveys, job analysis, job

evaluation, recruitment, employee / industrial relations, manpower planning, staff appraisals,

training and career / succession plans, security at field locations and staff health are some of

the areas which fall under Human Resources.

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In a nutshell, the role of Human Resources function is to support the business as a strategic

partner and to provide such conditions where the employees can achieve their ultimate

potential.

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The Company has embarked upon a major Change Management Program to improve

communication channels through increased interaction with the Company staff and greater

employee engagement.

The prime focus of the Company has been to optimize hydrocarbon production through a

motivated team of professionals. Being cognizant of the challenges affecting its operating

environment, the Company has in place effective strategies to improve retention of staff,

especially in core technical functions and to ensure that it continuously maintains its

commitment to recruit, train and develop high caliber staff that will help sustain the prominent

growth trajectory experienced over the last three to four years.

Succession Planning in PPL is considered a key strategic exercise. Every year a thorough review

of business requirements is undertaken in each function in a structured way with primary focus

to identify key positions, determine skills and performance standards for these positions and

identify potential candidates for development. This helps to ensure that suitably qualified

personnel with appropriate skills and competencies are available to fill the vacancies becoming

available due to business reasons and / or attrition of staff at short notice thereby ensuring

continuity in leadership.

The Company has embarked upon a major Change Management Program to improve

communication channels through increased interaction with the Company staff and greater

employee engagement. The first initiative in this respect was the introduction of Town Hall

meetings with employees at all its locations. We are pleased to report that a healthy staff –

Management interaction has become an essential part of our culture as it evolves to

accommodate elements of corporate longevity. HR believes that an open communication

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forum will act as a catalyst towards motivating staff as they are enabled to air their views and

receive feedback from Management.

To augment the above Change Management Program, the Company has successfully

completed the exercise of aligning the overall vision / mission of the Company with Key

Performance Objectives of each function. This initiative will help the Company to fuse the

individual energies into an organizational thrust for achieving its vision of becoming the

premier producer of hydrocarbons in the country.

Another initiative under the Change Management Program is an Employee Satisfaction Survey /

Climate Survey which will be conducted by a renowned independent consultant. We expect

that this exercise will help the management in understanding and addressing the needs of

employees and motivate them for higher productivity.

Training and Human Resources Development

In order to equip our staff with up-to-date knowledge and skills for creating and sustaining

a culture of high performance, training is a strategic priority at PPL. We promote learning

culture that supports and builds organizational capability for continual innovation and change.

T&D continues to develop our human resource, by focusing on technical as well as soft skill

areas of competence development. By investing in effective and business linked training

programs we ensure that we develop a pool of professionals that would help the organization

in achieving its long term objectives.

Training needs of staff are assessed regularly, resulting in the identification of learning and

development opportunities for staff, which are then converted into training and development

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events, organized either in-house, or by sending staff on training programs organized by

external training providers both local and international.

During the year 2008–09, a total of 1,725 staff members attended 215 local and 33 foreign

training programs which comprised of a range of technical and soft skills courses, workshops,

seminars and symposia. As part of our two-year on-the-job training program, over 80 fresh

graduates from various local & foreign universities and 13 Special Trainee Technicians from

Sui / Dera Bugti are undergoing training at head office and field locations. Apart from this,

project based summer and winter internships were offered to students in various professional

disciplines at head office and field locations for duration of 4 to 6 weeks.

Under our foreign scholarship scheme, four scholars have joined the Company after completing

their Masters degree while four scholars are currently pursuing higher studies

in Petroleum Engineering at reputed foreign universities.

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LEADING

Leading Concepts Team Building, Teamwork & Leadership Development Seminars and related services have proven extremely effective for over 10 years at PPL. Leading is the fundamental requirement of any business these days, with the advancement in technology & management sciences, it has rather became an inevitable instance in every organization now days. Following are the core values on which leadership of PPL depends.

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PPL ON LEADERSHIP CONTINUUM

Since, PPL is a creative based working organization thus the concept of the project is done at the Head of Production or Channel head level but teams are also invited to poll in their creative input.

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MOTIVATING EMPLOYEES AT PPL

PPL is different from an ordinary organization; surveys suggest that the motivation level in employees working in Creative Organizations is higher than the other concerns.

In context of the Mr. M.A.K Alizai three-needs-theory, working in teams create a sense of affiliation among the members, over the short span of 10 years PPL has been counted as the emerging power in the society, so as to be a part of an influential organization suffice the need of Power, the last need has been the most important driving factor for PPL staff, the need for achievement, having immediate management and workers response on their effort could be the highest motivating factor.

However, supportive Leadership style also plays an important part in motivation of their staff.

JOB SATISFACTION

One of the most important aspects for any employee is to make sure regarding his job satisfaction. On asking about the job satisfaction for employees, we came to know that in PPL, they have very satisfied employees as they follow tri-yearly appraisals and yearly Job Enrichment(if supported by the appraisals) which eventually make the employees more motivated that their efforts don’t end in smoke. PPL gives yearly four bonuses to their employees in a year which is a best job satisfaction for the employees.

PPL has the following employee categories.

Full Time Employees who definitely have the most peace of mind. Their notice period comprises of 3 months which make sure them to have a new one in sufficient time & vice versa.

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Outsourced Employees are being taken from HRS. HRS is a third party firm which do have number of employees to be deputed in different organizations. Their notice period comprises of 1 month which if fair enough for them to have the new one & vice versa.

PPL’s ORGANIZATIONAL COMMITMENT

PPL respect the dignity and respect of its human resource. Through our corporate social responsibility program we also support the right to education, healthcare and basic civic amenities. PPL is highly committed to conduct its business in accordance with the highest ethical and legal standards. Business should uphold the freedom of association and the effective recognition of the right to collective bargaining. Companies operation with dignity of labour, minimization of animosity and fostering a relationship of trust between management and workers. PPL is committed to provide equal opportunity to without any discrimination on the basis of race, sex, religion, language, social origin, birth or other status.

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REWARDS

PPL believes one of the attracting tools in leading to motivate the employees is to Reward the employees. Employees are given rewards instantly in terms of cash, any valuables, gift hampers, upcountry tours on the back and many more. They benefit employees not only with bonuses even with life time membership of the whole family at country club, golf club, creek club etc. They make different strategies to facilitate their employees with social gatherings and parties. Following are some awards which make PPL more stronger:

First international HSE certifications of ISO 14001(EMS) and OHSAS 18001 (OH&S) were secured for production and mazari field.

For the second time, PPL won the large Tax payer Unit Excellence Award.

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CONTROLLING

Controlling is the final link in the functional chain of management activities and brings the functions of management cycle full circle.

Control ProcessThe control process is a continuous flow between measuring, comparing and action. There are all four key steps implemented at PPL for Controlling function:

Establishing performance standards

As mentioned earlier in the report while discussing planning process at PPL. It clearly states that PPL

provides the comprehensive planning process which helps in establishing necessary performance

standards and objectives. This leads to an Effective controlling system at PPL. Critical control points as

established by PPL Cost and production. Cost controls help ensure cost standards are met while

production control assesses how efficiently and effectively processes are done

Measure Actual Performance

Depending on the performance standards, the measurement of performance is done through financial

statements, production results, and formal performance appraisals. Supervisors collect data to measure

actual performance to determine variation from standard

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Comparing actual performance against standards

It involves comparison of actual performance against standards. This step does not imply that managers

should attempt to control or manipulate the personalities, values, attitudes, or emotions of their

subordinates. Indeed, this concerns the manager's role in taking necessary actions to ensure that the

work-related activities of subordinates are consistent with and contributing toward the accomplishment

of organizational and departmental objectives

Taking corrective action

PPL Management has clear understanding of where responsibility for deviations from standards lies.

Incase, inadequate performance is observed PPL management immediately take corrective action.

Otherwise they simple opt for reinforcement

Types of Control at PPLFollowing two types of control implemented at PPL:

Feed Forward Controls at PPL

- Budget controls - Training- Quality Equipment & Technology- Safety System

Concurrent Controls at PPL

- Adaptive culture- Total Quality Management- Employee Self-control

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This concludes our comprehensive studies of management functions at PPL.

… END OF REPORT …

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final management report

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