Human Resource Management Practices Of Pia Business Essay

Pakistan international Airlines, Pakistan`s flagship, national airline has been an air travel pioneer since its inception in 1955. PIA has many firsts to its credit and continues to soar, ever committed to innovation and rich customer experience. With a fleet of young airplanes, a crew dedicated to providing the highest standards of in-flight service, and stellar management, PIA is an airline that’s going places.PIA has been operating passenger and cargo services covering eighty-two domestic and foreign destinations. This airline is owned by the Government of Pakistan (87%) and other shareholders (13%). It has employed 18000 employees as of December 2008.

Mission Statement:

As a symbol of national pride, Pakistan International must strive to be an airline of choice operating profitably on modern commercial concepts, capable of competing with the best in its entire International and Domestic markets and consistently exceeding customer expectations. It should be a choice employer deploying modern technology in all spheres of its activities.

Vision of PIA:

“To be a world class airline exceeding customer expectations through dedicated employees committed to excellence”.

Slogan:

GREAT PEOPLE TO FLY WITH

Privatization of PIA:

In the late 1990s, the Government of Pakistan considered selling the airline to the private sector due to the persistent losses suffered by the airline. The Government announced the privatization plans but they were never implemented. Several steps towards outsourcing of non-core business have been initiated.

Financial Performance:

During the first quarter of 2007, the airline achieved a 5% growth in overall revenue mainly due to increase in passenger traffic. The revenue growth was lowered by a 10% reduction in cargo revenue. The EU bans on PIA in March 2007 reduced growth because only the Boeing 777 was allowed to fly to Europe. The impact of 2006 salary rise, increased cost of leased airplanes and higher maintenance cost of the PIA fleet increased overall operating expenses by 19%.

Achievements and recognition

First airline from an Asian country to fly the super constellation.

First Asian airline to operate a jet aircraft.

First Asian airline to be granted maintenance approval by the US Federal Aviation Administration(FAA) and the Air Registration Board, predecessor of the British Civil Aviation Authority(CAA).

First non-communist airline to fly to the people`s Republic of China and operate a service between Asia and Europe via Moscow.

First airline in Asia to induct the new technology Boeing 777-300 aircraft.

First airline in the world to induct Boring 777-200LR, the world`s longest range in commercial airliner.

First airline in the world to take delivery of the Boeing 777-200LR world liner (Longer Range Variant).

Pakistan International Airlines Flight Services Department was awarded the ISO 9001:2000 certification award during May 2006.

First airline in Pakistan to operate a flight with an all female crew at command in the cabin.

First airline in the world to operate the Boeing 777-200ER, 777-20LR and 777-300ER altogether – all the three variant available on the market.

PIA Flight Kitchens in Karachi were awarded the HACCP Certification.

Departments in PIA:

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.

Human Resource Management:

Since 18000 employees are currently serving PIA and these employees are considered to be the greatest asset for the organization so the management of these employees is a big challenge for HR managers. The biggest department in PIA is that of Engineering and then come other functions like IT, marketing, finance est. usually in mediocre organizations they have only 1 hr manager who is taking over all the responsibilities but in PIA there are aggregately 10 HR managers at each city including Lahore, Quetta, Karachi, Peshawar, Islamabad and so on. To discharge the functions PIA has decentralized some of its dept. though there are others which are centralized. All the small deptartments at PIA have been aggregated under one HR manager and the application of corporate policies in these departments is same as in others.

As per Mohammad Zafar Ali Shaikh in HR records department of PIA, everything has been centralized. For the performance appraisal reports and for the posting of employees to foreign stations, the data is being collected from HR RECORDS department. Since it is a government organization so it’s mandatory for PIA to have a check and balance and record of all the employees as they are being questioned by the govt. in the assembly regarding the number of employees inducted and posted at foreign stations per year.

The steps involved in Human Resource Management Process are as follows:

Human Resource Planning

Recruitment/Downsizing

Selection

Orientation

Training and development

Performance Appraisals

Compensations and Benefits

Career Development

Human Resource Planning

HRP is basically a process by which an organization ensures that it has the right number and kinds of people, at the right place, at the right time, capable of effectively and efficiently completing those tasks that will help the organization achieve its overall objectives.

As per Mohammad Zafar Ali Shaikh, PIA has a separate department called industrial engineering section which is responsible for the human resource planning. It is under the responsibilities of this department to decide how many and with what skills manpower is required. After undergoing various methodologies and formulas keeping in view the HRB (Human resource budget), it is decided that which location, which brand, which department will require what amount of human resource.

HRB is the budget that is allocated to meet all the expenses of human resource planning, this budget is being planned by industrial engineering section. HRB initiates the preliminary requirements concerning vacancies.

As per Mohammad Zafar Ali Shaikh ” PIA is a multi dimensional organization and it is quite difficult to understand the entire human resource planning process in one meeting” further explaining, he said that the HRB individually analyzes the requirement of workforce with respect to each department for instance e in flight operations department the amount of workforce needed is dependent on the number of stations on which flight would be landing, the number of cabin crew, air hostess, engineers, technicians, kitchen crew that would be present at each station to serve the flight, because once the flight lands on one destination the crew needs to be changed and it varies from one destination to another.

Job Analysis:

A job analysis is the process used to collect information about the duties, responsibilities, necessary skills, outcomes, and work environment of a particular job.

The job description and job specification are extracted from job analysis.PIA is a member of IATA (international air transportation association) which requires PIA to have an IOSA (IATA operational safety audit) after every two years. This IOSA audit is required to be done by an IATA approved organization and it is valid for 2 years. It is the requirement of IOSA that PIA should have a manual containing all the rules regulation and policies, the job description, responsibilities and duties of each job must be documented and PIA fulfills all these requirements.

Recruitment:

“The function of recruitment is actually to fulfill the man power requirement of PIA Organization”

Vacancies are first prioritized to be filled up by internal promotions. If position can’t be filled internally then external sources are used.

EXTERNAL RECRUITMENT

To attract capable candidates externally PIA takes help from the leading newspapers (Dawn and Jang) and the official website of PIA. As per Mohammad Zafar Ali Shaikh these are the only mediums used by PIA. As the HR records section has all the data base of the existing employees it can easily forecast the number of employees who will be retiring in the near future. The MTO`s and technicians in PIA are always in demand because their retirement rate is very high. Other than that the turnover rate of airhostess is also very high as most of them leave the job because of their personal lives issues. The technicians and engineers who are inducted and efficiently trained by PIA also have high turnover rates, since they are always in demand and offered high salaries at competing airlines including ETIHAAD and QATAR.

INTERNAL RECRUITMENT

Internal Recruitment is done by Promoting or upgrading the rank of any current employee by checking its capabilities & performance, for this the hr managers take help from the performance appraisals of the employees which has a record of their performances and then the succession planning is done accordingly.

Decruitment:

Decruitment is the process of reducing surplus of employees forecasted by HRP.

The decruitment strategy is followed to cut down surplus of employees but at PIA according to sir Mohammad Zafar Ali Shaikh “in relation with HRB there is always a shortage of employees at PIA and there is never a need to decruit but always a need to recruit, the categories including ground engineers, technicians, pilots, cabin crew and MTO`s are recruited per year”

Selection:

To hire the competent employees for the job at PIA, the selection process varies from one category to another. Like for each department there are different selection procedures and methods. For the selection of air hostess the selection procedure includes grooming test, height test, and the medical test (including the check up of their skin). For the selection of cockpit crew, PIA takes the simulation tests as well. All of these tests are taken before interviews. Generally 2 methods are used by PIA for all categories including written tests and interviews. As per Mohammad Zafar Ali Shaikh “These written tests are deliberately made tough and the content in it is also very difficult. So this way the incompetent employees get eliminated ultimately and the selection process becomes easier for PIA”.

Undergoing the steps in selection process the first one is submitting the Application form.

APPLICATION FORM

Application forms is must for a candidate to fill, if he/she is applying for respected seat or position

Application form is filled so that information regarding Background is known such as place of birth, current address, domicile and e.t.c.

Physical information such as height, weight, eyes, disability nature, and other info regarding physical appearance and body is taken

Marital status, nationality & religion is asked

Education background is also asked to estimate the performance of a candidate

Candidate is asked if he/she has applied in PIA before or not.

Candidate is asked about any present job pay & source of income

Candidate is even asked about number of children’s if married

Candidate experience is asked if he/she has worked before in any other company or organization

REGIONAL DISTRIBUTION OF SEATS

Regional Distribution is a standard through which selected numbers of people are hired by PIA depending on their region type, because every region has its specific quota as we can see in the chart below:

After the submission of application form, those candidates who meet the eligibility criteria then go thru the following tests:

1-Physical Test

Physical test is considered the first selection test in which the interviewer determines that either candidate is full filling the physical requirement for the job or not. “Their skin quality, height and weight are noted in the first interview session,” as per Mohammad Zafar Shaikh.

2-Grooming Test

If candidate selected in the first interview, he is then taken for a grooming test. Here, men and women present themselves in a manner, both physical and behavioral, befitting the job while women’s make-up skills are also checked.

3-General Test

Once the grooming test is cleared, the candidates’ general knowledge is tested in written and oral tests. These tests are sometimes based on brainstorming. Now days this selection tests are administered by NTS.

Application form is the first step to determine the initial performance according to which merit list is made and it is followed by the above tests and in case of different categories these tests may also include simulation tests and background verification and then the employee is finally hired according to the regional distribution of seats.

PIA is an equal opportunities employer and aims to ensure that no job applicant or employee receives unfavorable treatment on the grounds of gender, race, color, ethnic origin, religion, or disability. All appointments are made on the basis of merit and regional distribution of seats as restricted by the Government of Pakistan.

Orientation:

After the induction of employees a formal orientation program is arranged at PIA training center to give the employees an initial and basic know how about the organization. Departmental heads play a vital role in the orientation process.

Management Training Unit:

The management training unit provides orientation courses for newly inducted training officers and supervisory skills for engineers. Besides the orientation courses, this unit also offers short courses and seminars on leadership, team work, motivations, stress management etc.

Socialization:

To make the employees learn the culture of the organization regarding how the rules, regulations and the policies are practically implemented in the organization, socialization is very important. According to Mohammad Zafar Ali Shaikh there is no formal and informal platform for employee`s socialization, after induction employees get along with their colleagues and sub ordinates very well and this way they learn the culture of the organization b y themselves.

Training and development:

The training and development programs for the employees are in relation with the industry practices. The training courses are predefined and SOPS are developed, Standard Operating Procedures (SOP) are prepared for each critical utility or piece of equipment to provide all personnel working with the equipment information and instructions on what is required in order to maintain, operate, and clean the utility or piece of equipment. An initial training is given to all the newly inducted employees to build the basic knowledge, skills and abilities required to perform their jobs efficiently and with the passage of time as the new technology introduces or other changes in the market situations, trainings are given to the existing employees.

PIA Training Center:

The PIA training center (PTC) at Karachi is the only airline-training establishment in Pakistan where comprehensive instruction in almost all major fields of commercial aviation including Flight Operations, Engineering and Maintenance, Flight Services, Airport Services, Marketing(Reservation and ticketing), Information Technology and Management( Soft skills). There are around 75 highly qualified and experienced professional instructors at PTC specialized in different fields of airline operation.

Courses offered at PTC:

1-Customer Service

This type of training is provided to the employees who are directly dealing with the customers like air hostess, customer service staff, marketing staff etc. training is compulsory for the newly joined employees as well as need based employees. Following training comes under the umbrella of the customer services.

Flight Service

Marketing

Passenger Service

2-Engineering & Maintenance

In engineering & Maintenance shed, following types of training exist. Such training is provided in the technical school of PIA by the engineers. Latest equipment and procedure are being used to train the employees.

Apprentice

Aerospace

Avionics

3-Flight Operations

Such training is provided to the pilots in virtual environment so that risk may be reduced while making real time operations.

4-Information Technology (CBT)

PIA provides training to their employee’s computer based training so that they can run properly the information system based on oracle and SAP.

5-Management

Management staff plays a key role in PIA. Stress management, team work, leadership, skill building and other such traits which are necessary for a good manager, PIA arranges seminars and workshops to train their staff.

Manual and equipments based trainings:

Around 10,000 trainees are trained manually. Training facilities available include

Flight simulators

Cabin mockup mini airport

Language lab

Electronic labs

Workshops

CBT (computer based training)

Classrooms equipped with modern teaching and training aids.

These facilities and equipments are maintained by highly skilled and experienced support staff.

As per Mohammad Zafar Ali Shaikh, a basic training is given to the airhostess after their induction and initially they serve the small airplanes but with the passage of time they are given training courses of large airplanes including Boeing and airbus and similar are the case with the cockpit crew, engineers and technicians. They are initially trained for small airplanes like ATR`s and then they are given trainings for airbus and Boeing planes after getting trained these employees go thru an oral test and then they get the license and certificates to work at Boeing and airbus.

Examination Unit of PIA Training Center (PTC)

The examination unit of PTC has an important role in managing examinations of Aerospace and Avionics Training Units to meet the regulatory requirement of CAA and to maintain a liaison with CAA. This unit has developed computer based examination system thru which the employees are assessed.

Foreign training programs:

At the foreign training programs mostly the instructor of engineering dept. and cockpit crew is sent abroad, sometimes a group of employees go there with the senior instructor and sometimes only the instructor goes for foreign training alone. These instructors and employees are trained from aircraft manufacturer, vendors, IATA and other Organizations. Each year the training members of different unit receive IATA/IATF scholarships awards. The instructors of regulatory courses are qualified and approved by CAA.

Performance Appraisals:

For the evaluation of performance of the job holder, performance appraisals are being prepared for each employee. At PIA as per Mohammad Zafar Ali Shaikh the immediate supervisor of each worker is responsible for evaluation of each employee under him and then he submits this evaluation report further to the HR. dept.

Till group 6 staff and officers, the evaluation done by immediate supervisor is considered to be the final evaluation whereas in case of assistant positions, the evaluation done by the immediate boss is further reviewed by the General Manager and he has got the veto to overturn, cancel or rectify the flaws (if any) in the evaluation done by immediate supervisor.

The performance evaluation is actually based on the annual forms that are to be filled by the evaluator and it contains all the information regarding any special project or difficult task performed by an employee and the best or poor performance of an employee.Performance of employee is checked on basis of different categories in which they are graded from point 1 to 5 depending on their skills. All points given to candidate or employee is totaled, the total max points are 40 points out of which candidate/employee getting 35+ points has high chances of being hired or promoted to higher position, while 25 – 35 are kept in merit list and 15 below are rejected.

A performance appraisal form is attached with this report containing the instructions, competencies, objectives and final performance grading information.

Uses of performance appraisal:

Feedback

As per Mohammad Zafar Ali Shaikh feedback is considered very important and after the evaluation procedure if an employee has done great or worst then it is the responsibility of immediate supervisor to praise him or make him understand his job requirement or issue him any warning letter e.t.c

Succession Planning:

According to Mohammad Zafar Ali Shaikh thru performance evaluation it is determined that either the performance of an employee is above average, average, below average or poor and then decisions for the promotions are made accordingly. For being a manager, the performance appraisal of last 2 years must be above average. For being an assistant manager from an officer its required that the performance appraisal of 2 years must be average and above average respectively. These standards vary from one position to another.

Compensations and Benefits:

As per Mohammad Zafar Ali Shaikh at PIA initially performance based rewards were given to the employees for their best performance but now nothing like this happens. The compensation and benefits given to the employees at different hierarchy level are pre defined, PIA has categorized its employee benefits into two positions one is ground staff and the other is for flying staff. The benefits are provided according to designation and this how the employees are retained and motivated at PIA.

Following are some of the allowances and benefits that are given to the employees at PIA.

FOREIGN ALLOWANCE

RENTAL CEILING( Furnished :area/station head) (Un-furnished:-sectional heads)

ENTERTAINMENT Depends on requirement of position.

COMPANY CAR & FUEL CEILING Area/station head/station manager

EDUCATION ALLOWANCE UPTO 3 children @USD 275/month

SOCIAL SECURITY

MOBILE/TELEPHONE CEILING

ADVANCE AGAINST ACCOMADATION ALLOWANCE

DOMESTIC STATIONS ALLOWANCE

CAR/FUEL ALLOWANCE

ENTERTAINMENT

BOOKS & MAGAZINES

INDEXATION/COMPENSATION

SUBSIDISED MEAL FACILITIES

OVER TIME

Washing/uniform/kit maintenance.

Grooming allowance for females

RENTAL CEILING

ENTERTAINMENT CEILING

FUEL CEILING

BENEFITS:

Air ticketing

free medical

loan benefits

retirement benefits

hajj package

In short PIA offers a lot of incentives, lot of allowances for their employee.

Career Development:

In PIA there is a department named Staff development which is responsible for the career development of employees. Throughout the employee’s career with PIA, all the employees are provided with opportunities for professional, technical and personal development. In return, PIA expects them to work with dedication, integrity, and 110% commitment as PIA strives to become a world class airline. But being a government organization PIA does not actually follow any practices regarding the career development of its employees and this department is just a department for the sake of department.

Conclusion:

By visiting PIA we observed that PIA is a huge organization and even now it has the monopoly in the market because it is the only airline in our country that flies to 37 international destinations and 23 domestic destinations. From the size of this organization we assumed that PIA should be earning huge profits on its operations but in fact it is not like that. Unfortunately for the past several years PIA is facing huge Losses. The main reason behind this LOSS could be nothing but just the inefficient management of the workforce. By the above stated HRM process it can be perceived that this organization takes best care of its employees and follows all the HR rules, regulations and policies, but this doesn’t happen practically.

Forgetting about the above words quoted by Mohammad Zafar Ali Shaikh regarding decruitment, we the group members have another perception about govt. organizations that officially their might be a need of recruitment at PIA per year, but if we analyze it unofficially we all know the conditions of govt. organizations in our country, if a job requires one person at the desk then there would be 10 personnel working at that desk out of which 9 would be getting paid for no tasks actually performed, ultimately incurring losses to the organization.

Being a govt. organization, we can correctly draw a conclusion that PIA is overloaded with employees and this is the reason why PIA is not doing its best. Reduction of workforce is need of hour at PIA. Since the expenses of this organization are increasing yearly and resulting in deficit. PIA must adopt some strategies to reduce its workforce and do an efficient forecasting for the number of employees needed to recruit and decruit. With the right number of employees, working at the right place and at the right time and must make the efficient utilization of all the resources including the biggest assets i.e. employees to make this organization stable and have a good image in the market and among the general public.

Recommendations:

Employee Reduction Strategies:

PIA must offer golden handshakes and early retirements to the number of employees which are at surplus. This way the organization can get rid of overloaded employees.

Improve technical training programs:

As far as technical training is concerned, PIA has come across 4 major incidents because of the technical faults in its airplanes. So this organization must improve the technical training programs.

Improve interpersonal skills:

If we talk about the interpersonal skills there are a lot of annoyed customers due to the unsatisfactory services of customer services representatives. Being a big organization PIA must train its employees for their interpersonal skills.

Overcome Late flights and cargo problems:

PIA has become famous for late flights and cargo problems which are commonly held to the mistake of the staff. If proper evaluation of staff performance is done then there would be no such problems occurring.

Decrease the overhead cost and expenses:

This organization must decrease its overhead costs and its expenses else it would become difficult for this organization to serve the customer effectively and efficiently.

Hire employees on contract:

Rather than permanent jobs, employees must be offered contract based jobs in order to cut down the expenses as the contract based employees won’t be given the benefits like the permanent employees.

Proper check and balance of HR polices:

There should be a proper monitoring department to have a check and balance on whether the HR policies and practices are implemented in their real sense.

Focusing On Career Development:

PIA needs to be focused towards the career development of its employees as the staff development department is not performing its duties and responsibilities and for a good organization every function is considered to be important and crucial.