CHANGE MANAGEMENT

PROJECT

SUBMITTED BY:
SHOAIB QUDDUS
WALI AHMED
HASSAM RAZA
ZAFAR BERUM

SUMITTED TO:
SIR. CDR. AKRAM

1
 HISTORICAL BACKGROUND

The following table summarizes the successive events that took place
right from the independence of Pakistan in the telecommunication
sector before and after the establishment of the formal Pakistan
Telecommunication Limited.

Year Events
1947 Posts & Telegraph Dept established.
1961 Pakistan Telegraph & Telephone Depts.
1990-91 Pakistan Telecom Corporation.
1995 About 5% of PTC assets transferred to PTA, FAB &
NTC.
1996 PTCL Formed listed on all Stock Exchanges of
Pakistan.
1998 Mobile (Ufone) & Internet (PakNet) subsidiaries
established.
2000 Telecom Policy Finalized.
2003 Telecom Deregulation Policy Announced.
2006 Etisalat takes over PTCL.

2
 VISION

“To be the leading Information and Communication

Technology Service Provider in the region by achieving
customer satisfaction and maximizing shareholders' value'.
The future is unfolding around us. In times to come, we will
be the link that allows global communication. We are striving
towards mobilizing the world for the future. By becoming
partners in innovation, we are ready to shape a future that
offers telecom services that bring us closer.”

3
 BUSINESS DESCRIPTION

“The Group’s principal activity is to provide

telecommunication services. The Group provides domestic
and international services throughout Pakistan and also
manufactures telecommunication related equipment.”

4
 COMPANY PROFILE

Company Pakistan Telecommunication

Profile Company Limited
Business
Telecommunication Services
description
Ticker PTC
Exchanges KAR
2007 Sales 81,407,000,000
Major Industry Utilities
Sub Industry Telecommunications
Subsidiary U-fone
Subsidiary U-fone
Employee 62, 198
Strength
Customer 5.7 million
Strength
Operational CDMA
Advantage
V-fone 0.8 million
Customers
Daily Wages 11, 000
Total Revenue 67 billion
Profit 29 billion
Number of 13
Unions

5
 NAICS Cellular & Other Wireless
Telecommunications

ABOUT THE COMPANY

From the humble beginnings of Posts & Telegraph Department in 1947

and establishment of Pakistan Telephone & Telegraph Department in
1962, PTCL has been a major player in telecommunication in Pakistan.
Despite having established a network of enormous size, PTCL workings
and policies have attracted regular criticism from other smaller
operators and the civil society of Pakistan. Pakistan
Telecommunication Corporation (PTC) took over operations and
functions from Pakistan Telephone and Telegraph Department under
Pakistan Telecommunication Corporation Act 1991. This coincided with
the Government’s competitive policy, encouraging private sector
participation and resulting in award of licenses for cellular, card-
operated pay-phones, paging and, lately, data communication
services.

Pakistan Telecommunication Corporation adventured on its path of

development in December 1990, as it took over the operations and
functions from Pakistan Telephone and Telegraph Department under

6
Pakistan Telecommunication Corporation Act 1991. On the other hand,
pursuing a progressive policy, the Government in 1991, announced its
plans to privatize PTCL, and in 1994 issued six million vouchers
exchangeable into 600 million shares of the would-be PTCL in two
separate placements. Each had a par value of Rs.10 per share. These
vouchers were converted into PTCL shares in mid-1996. The
Government had a competitive policy, encouraging private sector
participation and resulting in award of licenses for cellular, card-
operated payphones, paging and lately, data communication services.

In 1995, Pakistan Telecommunication (Reorganization) Ordinance

formed the basis for PTCL monopoly over basic telephony in the
country. It also paved the way for the establishment of an independent
regulatory regime. The provisions of the Ordinance were lent
permanence in October 1996 through Pakistan Telecommunication
(Reorganization) Act. The same year, Pakistan Telecommunication
Company Limited was formed and listed on all stock exchanges of
Pakistan.

The PTC was segregated into four separated units in 1996. These are
as follows;

1. Pakistan Telecom Company Limited (PTCL)

2. Pakistan Telecom Authority (PTA)
3. National Telecom Corporation (NTC)
4. Frequency Authority Board (FAB)

PTCL launched its mobile and data services subsidiaries in 1998 by the
name of Ufone and PakNet respectively. None of the brands made it to
the top slots in the respective competitions. Lately, however, Ufone

7
had increased its market share in the cellular sector. The PakNet brand
has effectively dissolved over the period of time. Recent DSL services
launched by PTCL reflect this by the introduction of a new brand name
and operations of the service being directly supervised by PTCL instead
of Paknet.

As telecommunication monopolies head towards an imminent end,

services and infrastructure providers are set to face even bigger
challenges. Pakistan also entered post-monopoly era with deregulation
of the sector in January 2003. On the Government level, a
comprehensive liberalization policy for telecom sector is in the offing.
In the middle of 2005 Government of Pakistan had decided to sell at
least 26 percent of this company to some private agency. There were
three participants in the bet for privatization of PTCL. Etisalat, a Dubai
based company was able to get the shares with a large margin in the
bet.

The current President and CEO of PTCL is Mr. Walid Irshad.

Last year when Government was going to privatize the company there
was country wide protest and strike by PTCL workers. They even
disrupted Phone lines of some big Government institutions like Punjab
University Lahore and many lines of public sector were also blocked.
Military had to take over the management of all the Exchanges in the
country. It arrested many workers and put them behind bars. The
contention between Government and employees ended with a 30%
increase in the salaries of workers.

Many big change events are happening in PTCL at the moment after its
privatization. These include the VSS (Voluntary Separation Scheme for
its employees), ERP (SAP based), restructuring, B&CC (Billing and

8
Customer Care Software) etc. Another seemingly minor change was
change of brand identity (logo) that will present PTCL’s new face after
privatization, with greater focus on customer satisfaction and bringing
about of new advancements in telecom for Pakistani consumers.

9
 GOVERNMENT-OWNED PTCL

The PTCL before its privatization in 2006 was formed and listed on all
stock exchanges of Pakistan in 1996. This was through the provisions
of an Ordinance that lent permanence to PTCL monopoly over basic
telephony in the country. It was known as the Pakistan
Telecommunication Ordinance.

Although, private sector participation was encouraged, PTCL remained

to be a Government-owned organization. This meant that it had a
typical bureaucratic set-up of organizational structure, design and
culture, with centralization at all levels of the business. The
management had to abide by the Government rules, regulations and
policies and thus, there was no room for organizational innovations.
Employee leaves and their transfers were done according to
Government guidelines. While enjoying a market monopoly in the
Telecom Sector of Pakistan, PTCL sustained a perfect mechanistic
structure of organization.

The Government-owned PTCL faced quite a few vices which our

bureaucracy has been possessing ever since its formation. High
absenteeism, late task completions, mismanagements, lack of
coordination among various organizational levels, disregard of
customer complaints, employee conflicts and above all a weak
accountability system are some of the flaws that existed in the
Government-based PTCL.

Occasionally, an employee went for a managerial training program

abroad. There was no concept of conducting training workshops for the
managers at the national levels and the Human Resource Department

10
was a below-level unit of PTCL. Employee number was large, among
which majority of the staff members were redundant ones. Due to this
overwhelming size of the organization, the employees were dissatisfied
with their salaries and perks and benefits. The technology in use in the
office premises was not compatible with the international telecom
sectors. Employee-incompetence in case of new technology was also
prevalent. Hence, the Government PTCL existed not due to an efficient
organizational structure and swift operations, but because of its
monopolistic nature of business.
PTCL organization kept on growing as its business expanded
constantly, being the sole provider of telecom service in Pakistan.

11
HIERARCHY

12
 CHAIRMAN

SEVP
Finance SEVP SEVP SEVP SEVP
Technical Procurement Operations HR & ADM

EVP
EVP EVP EVP EVP

GM
GM GM GM GM

Senior Manager Senior Senior Senior Senior

Manager Manager Manager Manager

Managers
Managers Managers Managers Managers

Asst. Mgrs

Executives

Clerks

Asst. Mgrs Asst. Mgrs Asst. Mgrs Asst.

Mgrs

Executives Executives Executives Executives

Clerks Clerks Clerks Clerks

13
The structural hierarchy of PTCL given on the previous page, shows
that the company endorsed a functional structure of organization. As
this structure is too bureaucratic, the problem with PTCL was that it
was not able to respond to rapid changes in the telecom sector in
which it was running its operations.

PTCL as an organization was weakened due to its functional structure

on the following grounds;

• Slow response to the changes in the cellular environment of

Pakistan
• Slow decision-taking time due to high levels of hierarchy
• Seldom was there coordination among the executives of the
same level
• Lack of formal communication
• As PTCL grew more and more functional subunits were added to
it, which the management found difficult to link with overall
profitability of the organization
• There was no innovation
• Goals were set by at the top and the strategies were imposed on
the subordinates, at times even the General Managers (GM)
found it difficult to use their own decision-making power.

14
 GOVT-PUBLIC PTCL

Due to its rampant growth after successive time periods, PTCL

introduced the mechanisms of Public Sector in its operations. Nothing
much changed except for a significant establishment of ‘Labour
Unions’ and their ‘Contract Negotiations’. At PTCL the Labour Union
was an elected body of the office bearers, selected by the labourers
themselves, which were aimed at working for the rights and welfare of
the labourers. It also acted as a coordinating body between the
working class and the management of the organization. PTCL had
thirteen (13) unions of labour, out of which, one was elected as CBA in
1996. Collective Bargaining Agent (CBA) is an association of
employees, that have assembled together to pursue common
industrial goals.

Though, the idea and purpose of having labour unions was a well-
defined one, still PTCL started facing crisis among its skilled class.
Employees and the unions were not gratified with the treatment they
were given by the administration of the company and they had
complaints against the PTCL set-up that were duly expressed in he
strikes and jalsas the labourers called in between July and September
2004. Ultimately, on September the 30th 2004, the CBA beckoned all
the members of the unions and permitted them to raise their voices for

15
the attainment of their legal rights at the PTCL Headquarters’ parking
slot.

Thousands of PTCL Employees participated from all over the country in

these agitations. The labourers chanted full throat slogans against the
management. The banners and posters were placed and held all
around the gathering. The transport police officers were forced to seal
the road for preventing the routine transport activity to happen. The
number of aggrieved labourers outnumbered that off the security
personals, which then depended on tear-gas equipments for controlling
such a mammoth crowd. Thus, the ‘labour crisis’ of PTCL have been of
significance for the Public Sector of Pakistan.

PRIVATIZATION

Privatization or denationalization is the process of transferring property, from public

ownership to private ownership. The reverse of this is called nationalization or
municipalization.

Privatization refers to the transfer of any federal property or management to any other
person. Person in turn; is broadly defined to include partnerships, companies and the like,
other than those controlled or owned by the Federal Government. In legal terms,
privatization includes; a transaction by the virtue of which any property, rights, interest,
concession or management thereof, is transferred to any person from the Federal
Government or any enterprise owned or controlled, directly /indirectly by it.

16
In a broad-spectrum, privatization was common during the post-World War II era. But
privatization became a more dominant economic trend during the 1980s and 90s. This
tendency of privatization has often been typified as part of a ‘global wave’ of neo-liberal
policies and some observers squabble that this was greatly influenced by the policies of
U.S President Reagan and the British P.M Thatcher. The term “privatization” was created
in 1948 and is thought to have been popularized by ‘The Economist’ during the 80s. In
theory privatization establishes a ‘free market’ mechanism while fostering capitalist
competition, which in the point of view of its supporters gives the public, a greater choice
at a competitive price.

Following are the details regarding the reasons behind PTCL’s privatization and the
consequent managerial changes, which the process brought in the organization.

WHY WAS PTCL PRIVATIZED?

Since the Government of Pakistan had taken a bold step of adopting

the privatization regime, therefore, a Government controlled
organization like PTCL could not survive in the open competitive
market where private telecom/cellular companies had already made
major grounds by providing better services, compared with the ones
offered by PTCL.

The policies of ‘Telecom Sector’ were encouraging and the

Government of Pakistan clearly envisaged the need to de-nationalize
all those organizations under Government control which in the near
future were considered to be facing tough competition. Due to the
bureaucratic stance, organizations like PTCL would not have been able
to compete in a profitable way with other private companies, either

17
local or multinationals. The entire developed countries’ models clearly
show that Governments are into regulatory affairs while running
commercial institutions. As commercial institutions are being run on
target v/s achievement equation, Government controlled commercial
institutions cannot work and produce such results which will be
competitive.

This anticipation of the Government reagrding PTCL’s future, was

turning out to be a reality from mid-2002. PTCL sales started to drop.
Thus, it was the right time to privatize PTCL, for its better growth and
sustainability; otherwise the time was not far away when the
organization would have been declared a ‘sick unit’ by tagging the
institution of not being competitive in the market. As a result of this,
millions of people would have been deprived of employment
opportunities, giving another blow to Pakistan’s instable economy-
growth.

For PTCL’s privatization the Government of Pakistan auctioned 26% of

its shares with management control in 2005. There were three bidders
to this auction and finally on June 18th 2005, the UAE-based company
Emirates Telecommunication Corporation (Etisalat) offered the highest
bid of $2.6 billion (Rs.155.2 billion) for PTCL. The formal privatization of
the organization started in 2006, when Etisalat took over the
management control of PTCL.
PTCL PRIVATIZATION

The privatization of PTCL brought in colossal managerial, structural,

cultural and service changes in the organization. This chapter includes
the nature of changes at PTCL and the ways the executives and the

18
staff of the company managed the amendments in the post-privatized
period.

PTCL’s concept of change is:

“To bring change in a positive and optimistic

manner”

The change through privatization was aimed at bringing in the

following notions of modern-day businesses. These are;

• Accountability
• Competency
• Target v/s Achievement
• Revenue Generation
• Reducing Turnover
• Popular/Hard Decisions
• Employee Motivation & Retention
• Decentralization
• Innovation

Currently, 55 million people are engaged in the telecom sector.

Changes are constant and at times necessary. But PTCL wants to take
change as an ongoing and continuing process, instead of a temporary
decision imposed on its employees without getting their approvals or
analyzing the outcomes.
VOLUNTARY SEPARATION SCHEME
(VSS)

19
Etisalat brought in some general changes in PTCL, whose effects were
prominent at the grass-root level of the organization and the products
and services being offered to its customers. For making it more
competitive; structural and cultural improvement were emphasized
upon (details are given later on), of which trimming the organization
was the foremost tool. As said before, PTCL was retaining many
redundant employees before its privatization. After Etisalat take-over,
the employee number was reduced to 30, 000. About 35, 000
employees benefited from the Voluntary Separation Scheme (VSS) and
left PTCL.

The VSS is completely voluntary scheme, where Etisalat/PTCL

Management is not forcing any employee to resign from the
organization which they have served for a considerable time period.
Though, these employees are termed as ‘redundant’ by Etisalat, they
are being provided a free will to continue or discontinue with their
services at PTCL. Through VSS, employees are offered lucrative
incentives in opting out of PTCL.

The employees who did not go for for the VSS will have to come on
PTCL NTC (New Terms and Condition Contract). But it depends upon
the PTCL Management as what to do with these employees; either to
sent them home with their standard financial perks as given by the
company or just fire them after June 2008 promise which is between
the government and (Etisalat/PTCL) Management as not to fire any
employee before June 2008. However after the said time PTCL
management is free for making any decision for the future of PTCL
employees.

20
A follow-up program by PTCL to the VSS is to give financial packages to
the workforce left in the organization for employee-retention! Salaries
are raised, and as a motivational technique the employees are given
vocational training by institutes like the Punjab Technical Institute,
whose expenses are all borne by PTCL. In this way the key talents were
preserved and the jobs that were identified as ‘redundant’ were
eliminated.
Initially, the Etisalat management observed the outcome of VSS. After
eight months, the results showed success. It was realized that people
liked the offer and hence, it was continued.

21
 STRUCTURAL CHANGES

The new hierarchy was as follows:

PRESIDENT

22
 SEVP
Finance SEVP
SEVP SEVP SEVP SEVP
HR &
SEVP
TECH Corp.D Procurement Operations ADM
Commercial

Although the hierarchy and the designations previously seen in PTCL

were retained, two new positions for the rank of Senior Executive Vice
President (SEVP) were added for Commercial and Corporate
Development subunits. Currently, PTCL has 133 GMs and 33 EVPs.
There are 8-10 SEVPs and 1 President. As it can be seen that PTCL
maintained its functional structure of hierarchy as before even after
Etisalat’s take-over, but his time the management tried to capitalize on
the strengths of its structure, which to an extent it has been successful
in doing.

The management has benefited from the economies-of-scale within

every functional department. The employees within each function are
encouraged to gain in-depth knowledge and develop their skills. As in
this structure, people are grouped together, the management
emphasizes upon maximum cooperation. Moreover, the young blood
inducted in after the privatization are allowed to give in their ideas and
do their job their way. Hence, innovation is welcomed at PTCL now.

23
It has been mentioned earlier that one of the aim of privatizing PTCL
was to decentralize the system. Now with the management control
with Etisalat, one can observe decentralization at all levels of the
organization even in this functional structure. This is due to the fact
that with a hundred-and-thirty-three General Managers, it is not
possible for the SEVPs to monitor the activities of their respective GMs.
The routine reporting to the heads before implementing a decision is
no more a compulsion for the GMs. They are allowed to function with
their staff according to their own aspirations. The rules from the top
are discussed before being executed, with the concerned GMs and
managers, unlike before when they imposed. The heads conduct
regular meetings with their GMs, in which they deliberate on upcoming
targets, their strategies and feedback given by the customers. Hence,
increasing the number of SEVPs and GMs paved way for
decentralization in PTCL’s existing functional structure.

A point to be noted here is that decentralization is at the centre only;

other branches of PTCL are still centralized. This is an effective HR-tool,
which is adopted by prosperous organizations all over the world.
People at the headquarters are making their own decisions and
implement them elsewhere. If the same is the system in every branch
of the company, this can lead towards ill-coordination that can have
dire consequences. Thus, the Etisalat management is conscious
enough to espouse international standards of administration. There is
also a PTCL Advisory Group for giving and taking recommendations.
The President is from Ethicality and the rest of the members from
PTCL.

CULTURAL CHANGES

24
In Human Resource terminology there are two types of culture in
business firms; organizational culture and corporate culture.
Organizational culture is defined by the employees and is for the
employees themselves. Corporate culture is defined by the
management and is imposed on the employees, to which they have to
bear with. In most of the Government organizations there exists only
one culture which is corporate throughout. PTCL thus, had a weak-
corporate culture, where there was little alignment with the
organizational goals and strategies, rules and regulations were strict,
no empowerment, less motivated workforce and lack of support from
the management. A large power distance increased the
communication gap. There was superiority complex among the heads
and the subordinates found difficult to convince their point of views.

But, now after privatization the cultural scenario at PTCL has changed.
Firstly, there is a distinction between organizational and corporate
cultures. The employees are fee to choose their way of interacting with
each other, end result of which should be organizational success. PTCL
is confident about its workforce and therefore, trusts them for working
in the interest of the organization in which they are recruited.

The current PTCL employees are quite vocal about the gender bias that
existed in the Government owned-PTCL. Hiring of female employees
was discouraged at all levels of the organization. But now there are
female employees (of all designations) in all offices of the company.
They work together with their male colleagues to bring about the
desired results. During the preliminary days of settlement, the young
inductees of PTCL used to sit till late night in their offices for updating
data. They completed this target in lesser time than which they were

25
allotted. This change in culture of PTCL (which reflects hard work)
prompted the senior, high-rank staff of the company to change their
line of action as well. Hence, inspiration was moving from bottom-to-
top.

Previously, people at PTCL were used to a slow mechanism. After

privatization things have begin to move faster. The trend of having
peons has been abolished by Ethicality at PTCL. Therefore, all the staff
members from the SEVP to a clerk have to do work on their own. These
way employees at PTCL are forced to do something even if there is
nothing to do!

Before privatization, PTCL employees used to dress-up casually in

native clothing. Now there is a set dress-code for males and females
and they expected to go accordingly. The male members wear suits
with tie (no shalwar-qameez, jeans or t-shirts) and the females are
supposed to dress-up formally in their national dress. This way,
Ethicality/PTCL Management is maintaining decorum of the
organization together with employee-empowerment.

There is an air of loyalty to the organization and dedication towards

work at PTCL now. People are working in groups and teams and are
motivating each other. If PTCL continues with this kind of culture,
innovations will occur repeatedly and eventually the concept of
learning will be induced in the organization.

26
 HUMAN RESOURCE CHANGES

PTCL had its so-called HR-Department ever since its establishment,

but it was not up to the international standards. It was there for
carrying out routine activities of recruitment and administration, which
were again not capable to mark.

PTCL comprises of 62, 918 employees (as mentioned before). 2.4% of

the total employees are qualified professionals. A hundred and forty-
two (142) employees are on foreign deputations. At PTCL there was a
complete bureaucratic managerial set-up, therefore, the employees
and the top managers did not boast a robust liaison.

The post-privatization changes included improvements in the human

resource management of PTCL, as well. Previously (1970s-2000),
recruitment in PTCL was done through the Provincial Selection Centre
(PSC). The candidates were all from the Civil Superior Services and had
to undertake an exam at PSC for being inducted in PTCL. This

27
methodology was at peak till late 1990s and was reduced considerably
a couple of years before the privatization. Some employees are of the
view that the exam at PSC used to be an eye-wash. Instead, inductees
were finalized before by the Government. From 2000, a small number
of people were inducted trough an entrance test conducted by PTCL
itself.

The major breakthrough, in the recruitment process off PTCL came

after its privatization. The recruitment details are given on next pages.

RECRUITMENT

The recruitment of personals at PTCL can be divided into two

categories;

1. For senior managers (Regional Heads, General Managers, etc),

2. For junior managers.

The senior management recruitment is based upon the job experience

and qualification of the candidates. When these are at par with the
requirement of PTCL, the candidates appear for a formal interview
conducted by the professional staff, before the final selection.

28
As for the junior managers, the procedure is the same, except that
they have to take an entrance test, which if cleared makes their
experience and qualifications eligible for verification.

After the final selection, all the selected candidates undergo a medical
examination for ensuring that they are medically healthy for being
hired as PTCL employee.

As for the selection and recruitment of workers, they are recruited on

the basis of their skills and experience. All the past record of jobs of
such candidates is scrutinized. These candidates also undergo medical
examination like other PTCL employees, before being formally
recruited in.

The next page shows a sample of PTCL’s online recruitment format,

which was introduced on the 14th of August, 2007, with the new logo of
the company.

The following format is available on PTCL website, through which a

candidate can apply for a job in the company online.

Job Posting
Welcome to PTCL jobs Portal. If you are seeking a career with us then
sign up and build your resume
Three easy steps to apply for a job
Step 1 If you are a new user Sign up with us
Step 2 Create or Update your Resume

Currently no job available

29
 Categories
- Accounts & Finance
Audit Business Process
Commercial Corporate Affairs
Corporate Strategy Customer Care
HR & Administration Information Technology
Legal Affairs Marketing
Medical Public Relations
Sales & Distribution Technical
Telecom Engineering Training & Research
WLL Engineering

TRAINING & EVALUATION

As mentioned before that Ethicality/PTCL management is keen over

the training and skills development of its employees. Apart from
having them trained at the Punjab Technical Institute, employees are
also being sent to Dubai for their Human Resource Training by
international consultants.

30
Another project of the PTCL’s Career Development Department, is
aimed at increasing the skill competency of its workforce. Employees
will be trained in technical, financial and human resource categories.
This project is being supported by Ethicality through its TNA. The
overall objective is the organization-wide restructuring of PTCL.

Last year Ethicality called upon over 200 PTCL employees on

deputation to its headquarters in Khartoum (Sudan). The company took
this step in order to appraise the competent employees for their past
performances and to polish their skills so that they could work with
their even better efficiency at PTCL when they return back to Pakistan.
The transfer, postings and promotions of the PTCL employees are now
based upon the training an employee has gone through.

The performance evaluation at PTCL is based upon the subsequent

report and appraising systems;

a) Annual Confidential Report (ACR),

b) Employee Personal Information (EPI),

c) Centralized Management Information System.

All of the above performance evaluation of employees are conducted,

monitored and scrutinized by their respective top management.
RECRUITMENT HELP DESK

Help Desks are an innovative inclusion in the PTCL set-up. These are
made for assisting the fresh minds being made part of the

31
organization. There are specialists sitting their for assisting employees.
The ‘Recruitment Help Desk’ is for rendering services to employees.
It’s a sort of a counseling division from where people can have various
views and information about operating in PTCL and interacting in the
telecom sector. The desk is assigned give a ‘Starter’s Pack’ to every
new inductee. This pack includes;

• Laptop
• ID card (PTCL)
• Medical Card
• Phone Set
• Stationery
• Office Location

The laptop is given to every employee till the manager cadre. The
laptops and mobile-phone sets are for official and personal use of the
employees. ID cards are for identifying persons as PTCL employees.
The Medical cards are for employees to use for concession purpose.

TECHNOLOGICAL CHANGES

32
The Ethicality/PTCL Management aims at making its technology
compatible internationally. The PTCL offices now, equipped with
modern technology. As currently PTCL is endorsing on-line recruitment,
it’s necessary for it to have an efficient database system. Management
Information Systems, Information Systems and Human Resource
Information Systems are the operational databases being benefited
from at PTCL.

Moreover, the technological development in the organization can be

well observed through its products and services. The upcoming PTCL’s
products are all technology-intensive offerings. This way the company
is aiming to compete in the fast-developing telecom sector in the
country.

Through the advent of advanced technology, PTCL has changed from a

paper-base organization to a paper-less organization. This means that
all the daily work is done on computer through lotus notes and is
transferred where required via the Internet. ‘Lotus notes’ are common
but the most up-to-date technological finding of the present day. This
is less time consuming, convenient in managing and storing for the
employees working in a rapid business environment.

The Information Technology Help Desk solves the technological-

quarries of the employees related to the working of newly installed
equipment. From here the employees can get guidance regarding
Internet complications, video-conferencing, code-system, etc. The IT
Help Desk makes sure that lack of computer expertise of employees
does not expose their weakness; instead even if any of them is less
qualified in IT, the Help Desk can be benefited from.

33
 CHANGES IN LAYOUT

After privatization, the architecture of PTCL offices,

the indoor colour scheme, and the overall layout of
everything inside PTCL’s premises has been changed
to give a new and unique look. If one visits the PTCL
Headoffice in G-8 or any of its offices, whatever is
seen is not different from the premises of a
multinational or a private organization. The buildings
carry the new PTCL logo. The colours of the building are matched with
PTCL colours. The Headoffice is distinguishable from other offices as it
is all steel-grey from outside. Other offices have been painted cream
during the renovation process.

Inside the offices, the colour scheme used is that of green shades (as
per the logo’s colours). The employee cubicles are surrounded with
glass walls, each one having a slogan (of PTCL) engraved. The centrally
air-conditioned and heated offices are decorated with indoor plants. By
giving so many details about the physical outlook and layout of PTCL
offices, it is meant that changes from a Government to a private
organization had not taken place in operations only, but in appearance
as well.

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There have been changes in the seating arrangement as well.
According to the employees, prior to privatization, it was difficult to
meet with a head as he/she was positioned at a secluded place. The
environment was too suffocating. Now, all floors are an open place.
The GMs sit with rest of the staff (though in offices) and the two sides
are frequently interacting with each other without any hindrance.
Hence, an improvement in the places has brought about lessening of
formalities, which is an essence of an effective decentralized structure
and an innovative organization. The employees are happy with the new
layout and seem to be content with their inter-office communiqué
network.

PAY-SYSTEM CHANGES

For the first time since its establishment, PTCL has introduced the
concept of performance-based pays. This is a phenomenon of modern-
day management in which the employees are paid according to the
output they deliver. The basic pay as per the designation and tenure in
the organization is there, but the major chunk of the salary depends
upon the productivity of the employee. This type of pay-system is
workable only in innovative and decentralized organizations as there
are targets set that the employees have to achieve and projects are
assigned that are to be completed in a fixed period of time. So, there
was no room for performance-based pay in the Government-based
PTCL.

Now as employees are also hired on contractual basis, they are

incremented on their exceptional performances. Contract renewal is
also subject to employee-performance. These increments and

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contractual continuations of employees are analyzed by the GM and
discussed with the senior managers before he gives the final approval
above.

The contractual employees and the consultants deliver their daily

activity sheets to Etisalat headquarters in Khartoum (Sudan), because
their end-of-two-month pay is based upon these activity sheets. The
permanent employees (mostly GMs and the Executives) are not
supposed to make these daily activity sheets.

Hence, considering an initially Government-owned Company like PTCL

doing operational and pay-system likes of organizations like Asian
Development Bank and ABN-Amro, is quite a amusing veracity for
Pakistan.

PROMOTIONAL CHANGES

As already mentioned before that after privatization, PTCL added two

more departments to its already existing ones, one of them being the
‘Commercial Department’. This department is in Islamabad and carries
all the normal activities of sales & distribution, HR, finance, etc. But the

36
action that makes this department different from others is that it is
also patronizing the advertising activities of PTCL.

This department has a subunit – advertising unit, which has

professional specialized in this field working for promoting PTCL’s
brand image and its upcoming products and services in the print and
electronic media. This addition can be seen through the advertising
campaign of PTCL on the electronic media. Now PTCL advertisements
are as glamorous, pleasing and subject carrying one as the ones of the
cellular companies. PTCL has the advantage of being the sole telecom
giant of Pakistan; its ads are of much more significance than that of
the cellular companies.

Change in the logo and colour scheme by PTCL with effect from August
2007, has added a new face to the companies promotional activities.
This shows that after being privatized PTCL is following the
contemporary advertising techniques, which is a good sign. Hardly any
of the viewers would be remembering the ads of the Government-
owned PTL in the past! Same brand-endorsing activities are being
carried out through the print media as well. Often there ads of PTCL’s
upcoming products in newspapers like; DAWN, The News, etc.

As being part of sponsorship and international linkages, PTCL has hired

the services of the French company Alcatel-Lucent to deliver
“Broadband Pakistan”. On March 26th 2008, Alcatel-Lucent (Euronext
Paris and NYSE: ALU) today announced a multi-year agreement with
Pakistan Telecommunication Company Limited (PTCL) to deliver its
broadband access solution, enabling PTCL to provide high-speed
services throughout Pakistan. Supporting PTCL’s nation-wide program
branded “Broadband Pakistan”, Alcatel-Lucent will deploy 100,000 IP
DSLAM lines throughout the country, including rural regions and

37
outlying districts of urban centers. Alcatel-Lucent’s turnkey solution will
be supported by network element management tools that include
provisioning, fault management and disaster recovery. Alcatel-Lucent
will also provide network integration services including project
management, application/software integration, installation,
deployment, and testing.

Alcatel-Lucent will provide its 7302 solution which is part of the

market-leading ISAM (Intelligent Services Access Manager) product
family and its 5523 ADSL Workstation (AWS) for network element
management. Alcatel-Lucent’s ISAM product portfolio leads the DSLAM
market with a cumulative market share of 41%, more than double its
nearest competitor. With more than 180 customers deploying the ISAM
product portfolio - including 80% of the top 20 DSLAM operators in the
world - Alcatel-Lucent continues to be the undisputed leader in the
DSLAM market.

38
 RESULTS OF CHANGES AT PTCL

PTCL through its privatization has achieved a huge milestone of

restructuring the company and its subsequent effective image-
building. It has changed itself from a bureaucratic to a customer-
oriented organization. Earlier, PTCL was in routine with its activities.
Now the organization is more customer-focused. For this the
performance-level of employees have been improved through making
available the adequate resources and rousing them high-deserving
salary packages.

Firstly, Etisalat was successful in trimming down PTCL, through

effective rightsizing of employees with the VSS. Currently; PTCL retains
the necessary and useful employees doing the required jobs. There is
also no space for superfluous jobs in the organization as before its
denationalization.

A decentralized structure at the centre is helping the organization to

sustain a strong culture, with high-alignment with organizational goals,
empowerment of the employees, increased level of workforce
motivation and dedication, supportive management and recruitment
on merit. This all has resulted in the lessening of the power distance in
the company, where people are welcoming changes for organizational
development are not adamant upon uncertainty avoidance.

39
Collectivism is another process being stimulated at PTCL. Though the
Pakistani lifestyle has always favoured collectivism, our working habits
(unlike the west) have always mirrored individualism. The multi-
nationals companies in Pakistan are supporting the concept of
collectivism at work place among the employees and so is the Etisalat
Management at PTCL as well.

The management style is a participative one. There is an open-book

management all through the organization where there is employee-
involvement in decision-making as the workforce has access to
organizational information.

On the whole, these straight changes at PTCL as an upshot of its

privatization have provoked the theory of a learning organization. This
is when people are responding to changes in an effective manner and
there is an on-going process of improving and sharing knowledge.

Technological advancements have helped PTCL in attaining customer-

satisfaction by offering inimitable services. New products and services
like; IPTV, V-PTCL to V-PTCL, Broadband, Pakistan Package, reduction
in call rates are a treat for the Pakistani landline users.

People at PTCL are of the view that an overnight changed cannot be

brought. Change is a continuous process where the actual results take
time to reveal themselves. And the Etisalat/PTCL management has
gone with a voluntary progression of change, monitoring the result and
then continuing with the specific adjustment. Hence, rapid actions and
obligations have been avoided.

40
 RESISTANCE TO CHANGE

The privatization-cum-change journey has not been a joy-ride for

PTCL. There have been resistances to the privatization of this
previously Government-owned giant of Pakistan, at the managerial and
labour-level.

There are two categories of employees at PTCL; contractual and

permanent. The majority of the permanent staff is the old people who
are quite fond of the government system. They consider themselves to
be senior and superior to the youth inducted on contractual basis after
the privatization. These employees have an orthodox mindset and are
used to the mechanism of regularization (centralized activities).

On the other hand the new breed of employees at PTCL is exuberant, is

filled with innovative ideas and favour de-regularization of activities.
These people have a present-day mindset about organizational change

41
and thus, hail the privatization. Hence, conflicts did arise between
these two types of employee at PTCL in the post-privatization period.

Generally, speaking, people in Pakistan have resisted to all sorts of

changes; educational, social, political, organizational, etc. Now
resistance to change may be of two: individual and organizational.
Individuals resist changing due to fear of losing jobs, obsolescence of
skills, changing in the equations in the social relationships, etc. the
organizations may also resist to change due to resource crunch,
difficulty to bring in the change in the set operational methods and
sometimes simply due to the fear of the unknown.

The resistance mentioned above is at the individual level. The

subsequent pages show the labour-union crisis of PTCL, which depict
the managerial resistance to the privatization process.

LABOUR UNIONS

The current PTCL management is of the view that its labour unions
worked for their own benefits and could have put the company’s name
at stake for that. Politics were involved in their actions and some are of
the observation that the downfall of PTCL was partly because of its
labour unions. Thus, before the formal privatization of the organization,
its labour unions were neutralized and banned by the Government.
This was moderately due to the fact that ‘labour unions’ is an out-
moded concept internationally; hence Etisalat would have never

42
accepted it at the first place. Next is the account of the PTCLO
labourers and their unions’ resistance against the privatization.

The Pakistan Government announced the privatization of Pakistan

Telecommunications in June 2005. As a result of this declaration and its
succeeding accomplishments, the labour unions of PTCL from all over
the country took to streets to oppose this decision, as they desperately
resented the privatization of their employer company. These street
protests turned sadistic when the Government violated the agreement
it with labour unions regarding the halting of further privatization.
Consequently, the Government started a military crackdown and
arrested over 300 telecommunication workers and trade unionists.
Paramilitary police forces raided the homes of union leaders and
arrested their relatives. In effect there was a lock-out of the workforce
since all workers from grades 1-16 in the industry were barred from
entering the telecommunications depots.

However, the mood of the workers became even

more solid than before. They refused to accept
improvements in pay and the working conditions,
which the managing director of Pakistan
Telecommunications Company Ltd (PTCL) offered. The value of the
new package went up from Rs3.5 billion to Rs.5 billion but workers
refused to be nudged on agreeing to these enticements to accept
privatization.

One of the union leaders Haji Khan Bhatti held a press conference in
Karachi and gave the government 24 hours to release all those
arrested and to withdraw the restarted privatization process. Another
union leader Malik Maqbool also told reporters at that time that the
striking workers would shut down the telecommunications system from

43
15th of June, 2005. He warned companies not to participate in the
bidding process and said that if the process went ahead then the
telecommunication workers would take action against this happening
as well. In Quetta-Balochistan, telecommunication workers took to
action (even before in Sindh and Punjab) against the fiber optic link
which is the backbone for much of the system in the province. The
government and the PTCL Management were flooded with letters of
protest containing demands of the labour parties. The demands were;

1. Release all telecommunications workers and trade unionists

leaders taken into custody. Stop the crackdown now. No more
arrests.
2. For the immediate withdrawal of all paramilitary and police
forces from in and around PTCL premises.
3. Honour the 4th June, 2005 Agreement – No to the privatization of
PTCL.
4. Full support to PTCL workers fighting privatization.

Furthermore, paramilitary police arrested 8 trade unionists and

activists in Islamabad including Zafar Zaidi, a leader of the Pakistan
Telecommunications Union and Tanveer Shah, a member of the Action
Committee (which brings together the nine unions in the
telecommunications sector) from the headquarters of the Pakistan
Telecommunications Company Ltd (PTCL). A day before these arrests,
the Action Committee decided that it would boycott all future
negotiations with the PTCL Management because of the failure of the
government and management to honour the agreement they signed
which brought about the suspension of the strike on 4th of June, 2005.
In this they promised an indefinite postponement of privatization and
the agreement of 28 demands from the workforce on wages and

44
conditions. Ever since then, the Government Officials have been
attempting to force the unions to sign a deal on privatization.

In order to protect the leadership of the strikes from arrests, many

activists moved from house to house on daily basis. All the main
activists of the Trade Union Rights Campaign Pakistan took that
precaution as well as members of the Socialist Movement Pakistan who
were involved in the strike. With all these struggles by the labour
unions, the Government ceased furthering the privatization process
and also stopped the bidding for shares of PTCL, after they were given
threats of starting strikes again.

This victory was an inspiration for many

workers in Pakistan, who wanted to
fight against privatization, downsizing,
anti-trade union laws and the neo-
liberal economic agenda of the IMF and
World Bank, viciously implemented
since 1999 by the Musharraf Regime. The Government was able to
privatize two of the largest banks and two fertilizer factories without
much organized resistance from the trade union leaders. In the last
five years, the Government has stepped up the pace of the
privatization process and felt confident enough to start the process in
the state services sector as well. It tried to privatize PTCL since 1994,
but failed on two occasions because of resistance from the workforce.
The latest attempt was the most serious. The regime did not expect
much resistance from the trade unions and was confident in
announcing the start of bidding for shares for the 10th of June, 2005.
But strike actions and the protest movements forced the government
to retreat.

45
 Our Final Comments for PTCL

After the gathering of data we have come around on the following

analysis:
1) Managers are put under stress by change, and that stress, if
mishandled can result in loss of managerial effectiveness. Managers
need to be alert to the signs of stress upon their performance.
2) A common management tactic is to avoid involvement in change
when that involvement is unpleasant. The affects of this withdrawal
can be lethal to the organization and to the manager.
3) Another common tactic is denial of the effects of change. Managers
who do this tend to under- estimate the impact of the change, and
demonstrate an inability to respond to employees' emotional reactions
to change.

Suggestions and recommendations for PTCL:

Leaders can do eight steps which will help them manage change
efforts more successfully. These include the following:

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 Build an environment of trust with the employees in order to
create an environment where employees are more open to ideas
and more willing to discuss possibilities and problems associated
with change.

 Link the change effort to a common team value in order to help

employees feel they can relate to the change effort at a personal
level. This increases the desire and motivation to change.

 Articulate and communicate a clear message about why the

change effort is needed and will help the team. This links the
facts and figures supporting the change to the team value.
Communication should frequent throughout the effort.

 Establish a vision with the employees regarding the possible

advantages of making the change in order to help the team
define for themselves where the change will take them.

 Collaborate for solutions with team members so that employees

have the opportunity to identify the driving and restraining
forces in the change effort and identify action steps for
implementing steps to implement the change and overcome the
restraining forces.

 Establish and celebrate wins along the way. The leader should
actively orchestrate wins and celebrations so employees can see
that the change effort is important and see that changes in
behavior will lead to positive outcomes.

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  The leader must manage performance around the change. This
includes coaching those who need support with the change,
disciplining or removing those who continually resist the change
or have decided to fight against it, rewarding positive changes,
hiring employees who have the new capabilities needed in the
change effort, etc

 Constantly monitor the process and the results to ensure that the
change effort is on track.

Table of content

HISTORICAL BACKGROUND.........................................................................................2
VISION................................................................................................................................3
BUSINESS DESCRIPTION................................................................................................4
COMPANY PROFILE........................................................................................................5
ABOUT THE COMPANY..................................................................................................6
GOVERNMENT-OWNED PTCL.....................................................................................10
HIERARCHY....................................................................................................................12
GOVT-PUBLIC PTCL......................................................................................................15
PRIVATIZATION.............................................................................................................16
WHY WAS PTCL PRIVATIZED?...................................................................................17
PTCL PRIVATIZATION..................................................................................................18
VOLUNTARY SEPARATION SCHEME.......................................................................19

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STRUCTURAL CHANGES.............................................................................................22
CULTURAL CHANGES..................................................................................................24
HUMAN RESOURCE CHANGES...................................................................................27
RECRUITMENT...............................................................................................................28
Job Posting.................................................................................................................29
TRAINING & EVALUATION.........................................................................................30
RECRUITMENT HELP DESK.........................................................................................31
TECHNOLOGICAL CHANGES......................................................................................32
CHANGES IN LAYOUT..................................................................................................34
PAY-SYSTEM CHANGES..............................................................................................35
PROMOTIONAL CHANGES...........................................................................................36
RESULTS OF CHANGES AT PTCL...............................................................................39
RESISTANCE TO CHANGE...........................................................................................41
LABOUR UNIONS...........................................................................................................42
Our Final Comments for PTCL.........................................................................................46
Suggestions and recommendations for PTCL:..................................................................46

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