Organization Development

EXECUTIVE SUMMARY
Pakistan Railways (PR) is the state owned railway company of Pakistan. It is a
large organization under the administration of Ministry of Railways. Pakistan
Railways provides an important mode of transportation in the farthest
corners of the country and brings them closer for business, sightseeing,
pilgrimage and education. Its Current Chairman is Raja Shahid Hussain.
Pakistan Railways has been facing problems and is now on the verge of
bankruptcy with budget deficit of billions, eroding market share and
corruption scandals. At the time of independence, both India and Pakistan,
inherited the Railway Network laid down by British. While Indian Railways has
emerged as a highly profitable organization, Pakistan Railways is struggling
to keep itself running. This report summarizes how organization development
can help Pakistan Railways revamp its image and goodwill. It is based on
facts and hypothetical situations created by the group members to evaluate
the applicability of OD interventions. The data is collected from various
sources including books, newspaper articles and internet. The report
provides introduction of Pakistan Railways, its history, organizational
structure which is then followed by how the concepts of entering and
contracting can be applied to this case. Diagnosis of the organization has
been done with the help of data collected and hypothetical situations. Based
on the diagnosis, OD interventions have been suggested for Pakistan
railways which include techno-structural interventions.

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Introduction of PAKISTAN RAILWAYS

Pakistan Railways (reporting mark PR) is a national state-owned rail transport
service of Pakistan, head-quartered in Lahore. It is administered by the
federal government under the Ministry of Railways. PR provides an important
mode of transportation throughout Pakistan. It is commonly referred to as
the "life line of the country", by aiding in large-scale movement of people
and freight throughout Pakistan. (pakistan railway)

Organizational Structure

president
board of
director

executive
board

regional
cheif

Manager

Ministry of Railway is responsible for overall control of Pakistan Railways as

well as to guide the overall policy. There are four (4) Directorates in this PR
namely Administrative Directorate, Technical Directorate, Planning
Directorate, and Finance Directorate. (ministry_of_pakistan railway)
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The following officers also report directly to the Secretary Railways:a. General Manager (Operations)
b. General Manager/Manufacture and Services
c. Federal Government Inspector of Railways
Pakistan Railways at this time is a vertically integrated organization and has
four business units:
1. Infrastructure Business Unit
2. Passenger Business Unit
3. Freight Business Unit
4. Manufacturing and Services Unit

Structural Design
Pakistan Railways is a vertically integrated highly bureaucratic organization.
The current organizational structure is a mixture of functional and divisional
structures. The positions are divided into four classes:
-Officer Cadre
-Station Masters-Running Staf
-Class Four comprises of labors, signal operators etc.
The structure needs to be revamped into a more leaner and flexible one. A
combination of divisional and network structure will be most appropriate for
Pakistan railways. The PR management can retain the structure based on
current divisions and create a network of these divisions for better
management of operations and resources. (ministry_of_pakistan railway)

Human Resource
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Pakistan Railways is the largest civil employer in the country and has about
90,000 employees consisting of staf and officers as of 2008). 71% of the
total employees are working in Civil, Mechanical and Transportation
departments. All the hierarchy positions are held by graduate Engineers.
(pakistan railway)

Condition of Employees:

Pakistan Railways has about 90,000

employees consisting of staf and officers as of 2008 which is more than
required. Employees are taking salaries without working and sitting idle at
home. More than Rs.20 billion is allocated for salaries and pensions.
Employees have very strong unions so it is difficult for Government to fire
them.(dawn.com, 2013)

SWOT ANALYSIS
Strengths
Potential customers
Human resource
Monopoly
Weaknesses
Leadership
Wastage of time
Over emplacement

Opportunities
Demanding customers
Al ready setup tracks
Low cost
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Threats
Uncontrolled loses
Expenditures are high
Customer move to alternate options

PROBLEMS FACED BY PAKISTAN

RAILWAYS
There are five major problems Pakistan Railways is facing:

Shortage of advanced locomotives

Huge Losses & Budget Deficit
Mismanagement
Decreased Market Share
Corruption. (dawn.com, 2013)

Shortage of Locomotives:
The Pakistan Railways has a total of 546 locomotives but only 290 are on
track while the rest are out of order. Similarly, 70 per cent carriages are out
of service. In a report submitted to Railway Ministry, it has been disclosed
that as many as 70 locomotives are awaiting spares at Pakistan Locomotive
Factory, Risalpur since 2004. (pakistan railway problem, 2010)

Huge Losses & Budget Deficit

The reason for this loss is the presence of unnecessary departments which
are white elephant for Pakistan Railways. The biggest among those is the
Railways Police that takes over Rs 1.5 billion including emoluments and other
facilities followed by Stores and Purchase. These departments should be
abolished from Railways without further delay. Their utility for railways is
marginal at best. The Audit and Accounts, Railways Workshops Division, and
General Administration staf need drastic cuts. These organizations are
heavily overstafed. If they will continue to ignore the presence of nonproductive over stafed departments with very insignificant contribution in
overall performance of Pakistan Railways, the department will continue to
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decline. It shall never be in a position to meet the expectations of

public.Railways are operating at low rates. A flexible policy for rates and fare
requires to be adopted whereby freight rates could be varied according to
the type of commodities as well as direction. (pakistan railway problem, 2010)

Mismanagement
Currently Pakistan Railways is facing acute shortage of locomotives and
spare parts for maintenance of out of service locomotives. Since
independence little has been done to expand the railway network in
Pakistan. As per the reports compiled by the design team, Pakistan Railways
need 40 50 locomotives annually to run its operations efectively. However,
during the past two decades only 100 locomotives have been added. The
management of PR has failed to generate revenues through use of assets
like land, locomotive factory, carriage factory etc.
The focus of Railway officials is on getting new locomotives while ignoring
the improvement in operations and maintenance of existing locomotives. The
plans to change broad gauge into standard gauge at this stage are not just
costly but also unnecessary. (pakistan railway problem, 2010)

Decreased Market Share

Over the years, Pakistan Railways could not maintain its share in the
countrys transport sector. With Railway ministry shutting down operations of
various trains, it is no wonder that the market share of Pakistan Railways in
cargo transport has fall to mere 5% from 75% in 1960s and 1970s.
Around the world, railways are the cheapest and safest mode of transport
and majority of goods transport is carried out via railways. However, in
Pakistan the situation is completely diferent. The indiferent attitude of
various governments, direct competition from NLC, container mafia and bus
mafia are all behind the drastic condition of Pakistan Railways today.
Railways and NLC need to coordinate their operation and also compete in
their operations to economize on the inter modal movement of goods
traffic. The Railway should carry goods in bulk in the plains, while NLC and
private road transport should take over further distribution from these points
in to the hilly regions. This will help the railway to concentrate its resources
of locomotives and wagons on the main line in the plains, after withdrawing
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them from the hilly regions. This is in fact the best and most economical rail
road mix for the country. (pakistan railway problem, 2010)

Corruption
Corruption is the biggest problem Pakistan Railways is facing today. The
Railway Department has been sufering losses since years long. Contractor
system is one of the causes of such losses. Moreover, there are enormous
irregularities in local purchases. The number of officers cadre has increased
considerably since 1977, mostly due to political appointments. It has been
revealed that the crises are self-generated creating a space for more
corruption and PRACS-Pakistan Railways Advisory Commute Services is
responsible for this mess.
Selective services have been privatized by allotting its contract to diferent
private parties to operate those privatized trains. Ironically the contract has
been awarded only for ticketing and like buss conductors those private firms
after selling out the ticket deposits payments into the Railways account. As
per agreement after deducting its commission the contractors are legally
bound to deposit the funds into the Railway account but due to the nexuses
between Railways bosses and private contractors deposit the funds in private
accounts.
In short Pakistan Railways is a classic example of bad governance, poor
policies, corruption and mismanagement. (pakistan railway problem, 2010)

In the light of above problems the Railway Board decided to hire external OD
consultants to design interventions that can help in turning around the organization
into a successful reform change.

ENTERING & CONTRACTING

First External OD practitioner has been approached by the Railway Board to
help Pakistan Railway and solve the problem of this organization. As OD
consultants for Pakistan Railways, the first task for us is to understand the
current structure and the issues of this organization. A meeting with the
Chairman of Pakistan Railways, Raja Shahid Hussain and other members of
Railway Board was conducted to discuss the organizations issues like huge
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financial losses, Decreased market share, inefficient operations and

Corruption.

Key Clients
In case of Pakistan Railways, our main client is the Railway Board. Other
important key clients include GM Railways, Addl. GM of each business unit,
and representatives from Railway Employees Union, Railway Workshop
Workers Union, and Association of Station Masters etc.

OD Process
To clearly identify the problems faced by Pakistan Railways, we recommend
the OD process with following key steps:

Selecting a design team: A team of 8-10 individuals will be selected

which will include key policy makers for Pakistan Railways, representatives
from various functional areas of the organization and workers unions.

Diagnosing: Once the team is selected a joint diagnosis of the organization

will be conducted which will include understanding organizations current
strength and weaknesses, growth opportunities, organization culture and
values etc.

Action Planning: The first key output of the team is a 5 year action plan
that describes where Pakistan Railway should move to, key activities and
milestones, assigned responsibilities for those activities, and assumptions
that need to be monitored.

Implementation, Monitoring & Evaluation: As the plan is implemented,

new information, changes in the environment and other issues always arise
that need adjustment. In this phase the OD consultants along with the design
team will monitor the implementations and collect feedback to evaluate
whether action plan is on track or not and will fix any deviations. Also design
team will conduct formal evaluation processes and discuss their learning
about organization structure and change.

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Time & Resources

As OD consultants, we will provide consultancy services up to and including
development of action plan. Additional time beyond that time can be
contracted. Apart from the consultancy fee Pakistan Railways will also be
responsible for all the direct expenses for the research. The complete
process including diagnosis and development of action plan might take six to
eight months subject to:
-Access to key information and people.
-Commitment from PR( Pakistan railway) management.
-Access to sensitive information like HR records, PR policies, PR contracts etc.
-Prompt response/feedback from key clients. (pakistan railway-the life line of
the country)

DIAGNOSIS OF PAKISTAN RAILWAYS

Models represent the simplifications of reality and therefore choose certain
features as critical conditions existing in Pakistan Railway organization these
models helps to create a clear image of Railway organization. We are refer
basically three main models which represent the Railway Organization
structure, current strength and weaknesses, growth opportunities,
organization culture and values and work environment of the Railway.

Diagnostic Model
Every organization based on Open System Theory

Inputs consist
of
human
resources such as information, energy and materials coming into the system.
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Inputs are required from the systems external environment. Transformation

processes of converting inputs to outputs and finally output are the results of
what is transformed by the system and sent to the environment afectively.
We are selecting the model of Burke-Litwin Causal Model. This model has
motive that how to move intentionally to a desirable state and make the
dynamic organization for create an efective image in the eyes of the society.

Current Afairs of Railway:

Today almost all government corporations of Pakistan are in worst shape but Pakistan
Railways is in really bad condition and costing country huge loses every month. For
more than a century the railroad was the dominant form of land transportation in much
of the world. It was, and still remains the economic backbone of a country. Pakistan
Railway faces various problems some are as follows:

Mismanagement
Corruption
Shortage of advanced locomotives
Lack of technique-oriented staf
Downsizing

The Burke-Litwin

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External Environment afects on Railway:

Huge financial losses
Decreased market share
Expenditures are high.

Main features to diagnose Railway

Organization:
First constantly diagnose the whole structure, work environment of
Pakistan Railway Organization.
Second what technology should be used, how to use and what further
technology should be installed for further innovation in internal
environment.
Each employee/people/Actors must know about their task, what and
how to perform in odor to provide productive output.
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Each and single activity makes afects on other activities which are
functioning in a work setting so we have responsibility as a OD consult
to focus each factor for creating a new change and through diagnose
identify the main problem or lacking for maintain the long lasting
change.

Model Analysis:
The main problems existing in all over Railway organization which we
were diagnose are that employees motivational level are the main theme
of these whole scenario which afects the factor of performance.
All factors are the interrelated with each other if Pakistan Railway setup
their mission, goals and strategy clearly that what they want and how we
achieve desired goal and what they want to get from employees
performance.
The leader plays a dynamic role to boost the organization from bottom to
up leaders should know about mission and strategy, culture, system and
management practices because leader is only a person who guide and

lead the way to employees that how and what to perform efficiently.
Each and every individual have some needs and values before assigning
any task leader or management should develop the reward system for
motivating and appreciating the employees to perform outstanding and

provide various productive outputs to the organization.

If the employees are satisfied with their jobs they automatically give
outstanding performance on their job and they start utilizing their abilities
and skills in a right way rather than other activities.
Employees performance be productive through motivational level
increases than employees will become more productive.
If employees performance are satisfied automatically the image of
Pakistan Railway services in the society will be become good and make
the best images in the eyes of the Pakistans economy as well as Railway
customer.
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Employees are the assets of the organization employees are only main
actors who act according to their values, needs and satisfaction on
individual basis thats its the responsibility of management or leaders to
focus those motivational factors that how employees will be motivated
and perform outstanding on the job.
This model creates the image that all factors have strongly afects on
performance thats why as a consultant we totally focus on performance
of employees that how reward system should be develop by the
organization in odor to satisfied intrinsic and extrinsic values of individual.

FEEDBACK:
Feedback is the outcome of diagnosis. For the desired result several
meetings needs to be conducted with clients to determine the required OD
intervention for Pakistan Railway. To resolve the current crises it is necessary
that consultant and clients may agree on a joined venture.
If positive energy created between employees and valid information transfer
to the right person at the right place, bring transformational change from
lower to high level results the desired outcome.

TECHNOLOGICAL CHANGE:
However through proper use of technology in diferent areas like
computerized seat reservations, proper trains schedule, up to date customer
care service, time management, check and balance, track management etc
can bring positive output. Services should be providing on online system to
customers and internal environment setting as well.

PRIVATIZATION:
Pakistan Railway can privatize some of its manufacturing units, locomotive
factory, carriage factory so that through proper management all units work
properly and level of corruption reduces. In Privatization Company they are
maintain proper check and balance on employees, focus and evaluate the
job performance as well that how they provide productive output to the
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Railway organization. Some departments if becomes privatize it is beneficial

for Railway and environment as well and create an outstanding image in the
eyes of the customers through performance of organization.

EMPLOYEES:
If employees of Pakistan Railway are provided with benefits, incentives and
their level of motivation is high they will get satisfy from their organization.
Each and every employee should perform his duty which is assign to him
according to his post. Pakistan Railway should adapt the structural change
which will help in eliminating unskilled and non productive staf through
audits, layof and buyof packages. Pakistan Railway should develop the
compensation plan for employees to motivate their performance level and
satisfied their all basic needs and want. Compensation plan for employees
should be like that:

EMPLOYEE
EMPLOYEE
SATISFACTION
SATISFACTION
ENVIRNMENTA
ENVIRNMENTA
L
L

MANGEMENT
MANGEMENT
PHILOSOPHY
PHILOSOPHY
INTERNAL
INTERNAL
ENVIRNMENT
ENVIRNMENT

COMPENSATION
COMPENSATION

ECONOMIC
ECONOMIC
FACTORS
FACTORS

TAXES
TAXES

INFLATION
INFLATION

COMPANY
COMPANY
PROFITABILITY
PROFITABILITY
CONDITIONAL
CONDITIONAL
FACTORS
FACTORS

SUPPORTIVEN
SUPPORTIVEN
ESS
ESS OF
OF
COMPANY
COMPANY
KIND
OF
KIND OF
INCENTIVE
INCENTIVE ON
ON
JOB
JOB
PERFORMED
PERFORMED

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ACTION PLANNING
After a careful diagnosis, the results were feedback to the main clients.
Several meetings were conducted with key clients to determine the type of
OD interventions that will most appropriately suit the needs of Pakistan
Railways. The clients and consultants jointly agree that Pakistan Railways
need a mixture of techno-structural and human resource management
interventions to recover from the current crisis.

INTERVENTIONS FOR PAKISTAN

RAILWAY:
INTERVENTIONS:
To improve productivity of Pakistan Railway, we as an OD consultant can do
techno structural interventions and human resource management
interventions. We are selecting these interventions because we observe
that by doing technical interventions and human resource interventions we
able to bring new technology in PR and we recruit and select only skilled and
job match candidates first and then we would continuously observe their
performance and talent level and would given financial and non financial
rewards to motivate their performance level and increase their production
level. And involve them as much as possible in decision making and
empowered them for employee involvement and committed them in
organization.

TECHNOSTRUCTURAL INTERVENTIONS:
1- STRUCTURAL DESIGN:
The structure needs to be revamped into a more leaner and flexible one. A
combination of divisional and network structure will be most appropriate for
Pakistan railways. The PR management can retain the structure based on
current divisions and create a network of these divisions for better
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management of operations and resources.

2- Restructuring Organizations
We are focusing upon how to divide the overall work into subunits and how
to co-ordinate these subunits for task completion. By this we are capable to
set our mission and vision more clearly and also make aware of this
transparent knowledge to our clients and members of the organization.

3- REENGINEERING
Pakistan Railways have great potential for growth. Pakistan Railways can
improve the performance of its various functions and department through
proper use of information technology. The areas where information
technology can play a vital role include:

Seat Reservations
Freight Management
Asset Management
Track Management
Electric Billing
Timetable

Pakistan Railways should be privatizing some of its units like The Locomotive
Factory, The Carriage Factory and other large manufacturing units. Only
privatization of this sector is the solution of problem because currently
government of Pakistan has to bear the huge losses monthly.

4- DOWNSIZING
The Pakistan Railways is an over stafed organization. Political appointments
over the years have added to the problem and are the major reason behind
organizations financial troubles. Departments like Railway Police, Stores &
Purchase need to be abolished.

5- EMPLOYEE INVOLVEMENT AND COMMITMENT

By involving employee to our organization we are capable to bring successful
interventions and low resistance from organization. We have to increase their
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commitment by information, knowledge and skills, sharing of decision power

with the union and its members and rewards are manipulated to increase
employee participation and empowerment in organizations. It increases
focus on the improvement of organizational processes and customer
satisfaction.

Human Resources Management Interventions:

1- Goal Setting
By setting goals for all members of organization we would able to do more
productive work in Pakistan railway. Employees should be goal directed
towards organization mission and vision.

2- Performance Appraisal and Reward Systems

Line managers should compare their subordinates actual performance to the
standards that have been set. They should set appropriate task for all their
subordinates like: Role requirements (Expected outputs and outcomes),
Objectives in the form of targets and standards of performance, Performance
measures and indicators, Knowledge, skill and competency, Corporate core
values or requirements, performance development plan and continuously
monitor their performance, skill and mental level and give feedback and
appraise them to bring better commitment of employees towards
organizations goal and set rewards for them (intrinsic and extrinsic rewards).

3- Career Planning and Development

Management should pay attention for their employees career planning and
development opportunity to satisfy them and retain best employees in
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organization. Management should arrange workshops, seminars, on-the job

and of-the job training programs and job rotation to satisfy all employees and
managers to retain in Pakistan railway.

4-Managing Work Force Diversity and Employee

Wellness
We should consider organization basic culture and the working condition
which best suits for them and eliminate gender diference and biasness
among employees and make good compensation plan for employees.

All in all, we would first have to recruit best job match and skilled
candidates and downsize all corrupt and old age employees who dont have ability to
learn something new and do high resistance to change. We would bring technology
to our organization and train all employees. We would do gradually reform change
and guide all our stakeholders and make them with us to reduce resistance level.
We would make our information transparent for our employees and make them
highly involve in decision making and provide them chance for giving suggestions and
give new ideas for successful interventions to make them feel like that they owned
this interventions and feel part of the organization.

RESISTANCE:
Pakistan Railways staf faced severe resistance in the initial phases of

privatization and deregulation. The media aligned with big capital in its
assault on workers rights and credibility. Then there is the age-old
colonial and bureaucratic mindset, which has always said that the workers
never work.
The political parties have attributed labor wings towards the Pakistan
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railways. This influx has definitely impacted the unity of railway workers
and has historically tried to undermine the just fight of the unions. This is
because every party has its own agenda and these wings work according
to those agendas.
If the Pakistan railway privatized than the private party will be responsible

to bring substantive changes to value adding in the service to be provided

to passengers, Pakistan Railways would provide locomotives and coaches
with the standard fitting and amenities.
Pakistan Railways had to bear the expenses of Pakistan Railway Police

(PRP) from its own budget and resources.

Conclusion
Pakistan Railways have great potential for growth. . Pakistan Railways can
improve the performance of its various functions and department through
proper use of information technology. Pakistan Railways should be privatized
because this is one solution of problem because currently government of
Pakistan has to bear the huge losses monthly. Pakistan railway have some
financial problems due to over staf. Its should be mange according to their
needs of employee. Pakistan Railways can create networks to operate some
of its route for privatized trains. So, to solve these problems as the OD
consultant we use techno structural interventions and human

resource management interventions. so with these interventions

many problems are solved in PR. implement on these intervention.
once the change have been made then can be made Organization
Development & Change

Recommendations
Firstly employee needs motivation level increases then employees will
become more productive.

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The Rail services should be improved and must be provided to the

Passenger in time.
The HR department of the Pakistan Railways is not playing an efective
role. Proper arrangement should be
made for professionals by issuing detailed job description and job
specification to get maximum profit from them.
The salaries of the employees should be reasonable.
To restructure and modernized Pakistan railway under the present
administration.
The present situation of Pakistan railway may not change unless corrupt
high ups are removed, suspended and dismissed from the services.
Pakistan Railway should develop the compensation plan for employees to
motivate their performance level.
Focus and enhance the productivity of organization and expand their
abilities in to a sustainable and productive market in an ethical manner.

Bibliography
(n.d.). Retrieved from
http://en.wikipedia.org/wiki/Ministry_of_Railways_(Pakistan)
dawn.com. (2013, 18 01). Retrieved 04 28, 2013, from
www.dawn.com
government-people-places. (n.d.). Retrieved from
www.friendsmania.net/forum/pakistan-government-peopleplaces/25171.htm#ixzz2RhObsT
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ministry_of_pakistan railway. (n.d.). Retrieved from

http://en.wikipedia.org/wiki/Ministry_of_Railways_(Pakistan)
pakistan railway. (n.d.). Retrieved 4 28, 2013, from
www.wikipedia.com
pakistan railway problem. (2010). Retrieved 04 28, 2013, from
pakistan railway problem: www.friendsmania.net/forum/pakistan
government-people-places
pakistan railway-the life line of the country. (n.d.). Retrieved from
organization development and change:
http://www.slideshare.net/Marwed/pakistan-railways
http://www.privatisation.gov.pk/Transport/Pakistan
%20Railways.htm
Article Corruption in Pakistan Railways published in
Pukhtoonistan Gazette on Friday, 26 November, 2010

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