Main File (INTERNSHIP)

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CHAPTER – 1

1.1 PURPOSE OF THE STUDY.

The main purpose is to fulfill the basic requirement of the course leading to MBA Degree under IBA – MBA Programme.

To familiarize the reader with the process of corporatization of Power Sector in Pakistan.

To understand the function of the organization.

To know the working procedure of the organization.

To help enhance the writing skills as well as to learn the techniques of conducting research on any major business concern.

To practically see the application of Business Administration/ Management Techniques being applied in a big utility organization like HESCO.

To know how the recruitment process is completed is finalized and recruitment is made in any organization like HESCO.

1.2 METHOD OF STUDY.

The research was conducted by working I the HR department in HESCO being the head of the Recruitment Cell occupied the position as Deputy Manager (HRM), being the head of section working since last four years. The recruitment is completed in the each year.

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During the course of study various techniques were adopted which including personal interview, collection Primary Data/Secondary data collection of secondary Data from various reports / statements which have been incorporated in this research report.

Since HESCO is a corporatized entity of WAPDA various policies, rules, instructions and procedures framed by WAPDA and published in various bulletins and reports have also been referred to.

1.3 LIMITATIONS:

Secrecy of data made it difficult to gather the information.

HESCO domain is spread throughout Sindh touching the boarders of Balochistan and Punjab which made it difficult to practically reach every strategic place.

Lack of time and financial resources.

Confidential section of Recruitment Cell of HESCO made the researcher so difficult to trace the old record of recruitment made in the past 10 years, to compare the existing strength of recruitment made by HESCO with the recruitment made during the last several years.

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CHAPTER – 2

INTRODUCTION

2.1 HISTORY OF WAPDA The Water and Power Development Authority (WAPDA) was established through a parliamentary enactment in February 1958 for integrated and rapid development and maintenance of water and power resources of the Country. This includes controlling soil salinity and water logging to rehabilitate the affected land in order to strengthen the predominantly agricultural economy of the country. Its operation call foe a high degree of financial discipline so as to secure regularity in its transactions and also watch the timely assessment and realization of its revenues on account of sale of power.

2.2 MAIN FUNCTION OF WAPDA As per the charter, amended in March 1959 to transfer the existing electricity departments from the federating units to it, WAPDA has been assigned the duties of investigation, planning and execution of projects and schemes for

Generation, Transmission and distribution of power, Irrigation, water supply and drainage, Prevention of water logging and reclamation of saline

land, Flood control and Inland navigation.

2.3 THE AUTHORITY, MANAGER AND HUMAN RESOURCE The Authority, composed of four members, is headed by a Chairman. The other three member are one from each headed as Member water, power and finance wings. The administration part also comes under Member (Finance).The Members oversee the affairs of their respective wings through General Managers for the streamlined operations in the respective disciplines. For all practical purposes, the

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entire country has been divided into zones.Over 46 years of operations, WAPDA's human resource has developed into a reservoir of knowledge, competence and expertise through training and experience gained at the accomplished projects and remaining associated with diversified development activities. Presently, the human resource number is 1,33,564. These include professionals, specialists, scientists, economists, administrators, accountants and skilled workers for planning, building, managing and operating projects. Power wing being the developer and custodian of the largest and most significant utility service in the country employees over eighty nine per cent of the human resource followed by water wing and common services.

WATER

Member (Water) controls the water sector in the entire country divided into north, central and south zones. These cover, in general, North West Frontier Province (NWFP), Punjab, Sindh and Balochistan federating units respectively. The activity of water wing involves execution of surface and sub-surface water development and drainage-Salinity Control and Reclamation Projects SCARPs). Chief Engineers and Project Directors imR ent the projects.

POWER

Member (Power), heading the wing, supervises the functions of Chief Executive, National Transmission and Despatch Company (NTDC), 12 General Managers, Director Generals and Chief Engineers. Each of Planning, Finance, Grid System Operation (GSO), Grid System Construction (GSC), Thermal Operation, Hydro-electric Power, Coordination and WAPDA Power Privatization Organization

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(WPPO) departments are headed by General Managers. A Director General heads the Customer Services and Chief Engineer, Power (Operation) departments.

Each of eight corporate distribution companies is headed by a Chief Executive who has a host of technical and non-technical, skilled and unskilled paraphernalia under him. Five of these companies are operating in the thickly populated province of the Punjab and one each in NWFP, Sindh and Bal07rovinces.

FINANCEMember (Finance) has under him the departments of Finance, Internal Audit and Budget and Accounts headed by General Manager (Internal Audit) arid Director General Finance (B&C). He also exercises administrative control over Chief Engineer (Central Contracts Cell), Director General (Taxes), 7 WAPDA and Director Public Relations.A General Manager for general administration and services has two Director Generals to assist him, one each for Services and General Administration, and Medical Services, General Manager for Monitoring and Surveillance has a Director General and a C!)Jef Engineer (Monitoring) with him. He also handles matters relating to Wafaqi Mohtasib's office.Secretary WAPDA prepares minutes of the Authority's meetings, maintains records of its decisions and issues its directives and coordinates among the three Wings besides monitoringjU1d implementation of Authority's decisions.WAPDA has an elaborate setup for training covering all the wings of the Organization headed by a General Manager. Grants made by the federal and provincial governments for specific jobs.

Loans obtained from the federal and provincial governments.

Sale proceeds of WAPDA Bonds. Loans obtained by the Authority with general

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sanctions of the government Foreign aids and loans obtained from he IBRD, ADB

and other international loan giving agencies on such terms and conditions as may be approved by the government

Sale of power All other sums received by the Authority

2.4 RESTRUCTURING OF WAPDA The corporatisation process was effectively completed and

the corporatised entities of WAPDA (9 DISCOs, 3 GENCOs

and NTDC) are functioning under independent Board of

Directors. The process of Manpower Transition was

completed and the manpower had been assigned to the

Companies. All HR activities including hiring and promotion

for Grade I to 17 was also assigned to Companies.

Significant progress was made in respect of devising

policies and procedures for promotion and induction

boards, administrative powers for disciplinary actions and

leave rules.

Transfer of title of immovable assets from WAPDA to

Corporate Entities in the revenue record is an ongoing

process. Practically, all entities have the physical

possession of all their operational assets. However,

approximately, 65 percent transfer of land was achieved

before the end of the current year and WAPDA has agreed

to give Irrevocable Powers of Attorney to all Companies to

enable the Companies to assume ownership. As far as

transfer of liabilities is concerned, the execution of loan

transfers from WAPDA to corporate entities is almost

complete and all loan liabilities were allocated to the

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companies. Loan liabilities transfer agreements (LL TAS)

were signed with all the companies, which are the mother

agreements for the purpose of transfer of loans. Bonds

liabilities agreements (BLA) for transfer of liability

pertaining to WAPDA Bonds were signed between WAPDA

and the Corporatised Entities.

Consequently, almost all major lenders (i..e. World Bank,

JBIC, KFW, IDB, French, ADB, Kuwait, Swiss, Swedish and

Nordic) gave their consents for transfer of their loans from

WAPDA to the corporatized entities. World Bank suggested

a draft agreement and Law and justice Division gave its

concurrence on the draft Loan Assumption Agreements

(LAAs), Subsidiary Loan Assumption Agreements (SLAAs)

and Amendment to Guarantee Agreements (AGAs) of

various companies. Out of 294 the hulk of Loan

Agreements were signed by Company, WAPDA and EAD.

2.5 CORPORATIZATION / PRIVATIZATION OF WAPDA.

The corporatization/privatization of WAPDA including mainly Power Wing of WAPDA, which has been divided into Thirteen (13) companies consisting of Nine (9) distribution companies (DISCOs), three generation companies (GENCO) comprising different Thermal Power stations and one National Transmission and dispatch company (NTDC) which is composed of 500/220 KV network of Grid Stations and Transmission system of WAPDA. These have been corporatized as separate entities.

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CHAPTER – 3

ORGANIZATION OF COMPANY (HESCO)

3.1 BACK GROUND

In implementation of Govt. of Pakistan Programmed for restructuring & privatization of Pakistan Power Sector, Hyderabad Electric Supply Company Limited HESCO was formed by converting defunct Area Electricity Board (AEB) Hyderabad into a incorporated Company Limited by shares. Company’s historical back ground and its objectives have already been discussed in detail in preceding chapter at section 1.3.

3.2 ORGANIZATION OF HESCO.

The comprehensive terms organization and organization structure have been defined by many authors. The concept of some authors is given below:

According to Mescon, ALberd & Khedouri (1980) “an organization is group of people whose activities are consciously coordinated towards a common objective. Organization is frame work of management in action. It was defined earlier as the structure of responsibilities allocated to the managerial, supervisory and specialist positions and of the relation that arise in the discharge of those responsibilities.”

Simply draw a line form Chief Executive Officer to his subordinate executive colleagues, indicating functional or specialist relationship, may be a useful representation of specific relationship. The relationships are the part of planned pattern of working of management which enable to executives to cooperate in the pursuit of common task

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and in the fulfillment of common policy (Breach & Long man).

3.3. HESCO, COMPANY AND ITS OBJECTIVES:

Hyderabad Electric Supply Company Limited was incorporated during July 1998 under the company’s ordinance 1984 as public company limited. The company is formed to takeover / acquire all the properties, assets and liabilities of Hyderabad Area Electricity Board owned by Pakistan Water and Power Development Authority (WAPDA) and such other assets and liabilities as decided by the Authority the company’s main object is to distribute / supply electricity to the existing consumer residing the province of Sindh except Karachi Division and extend/expand the business, infrastructure, facilities and activities within the geographical boundaries to provide electric supply services to the prospective consumers.

The authorized share capital of the company is Rs.50,000.000 Million divided into five thousand Million ordinary shares of Rs.10.00 each. It is run through a Board of Directors consisting of 6 (six) members and one being its Chief Executive. As per memorandum of association, company’s other objects includes:-

To carry out the village electrification within the area of supply.

To carry out the renovation and augmentation including extension of HT/LT lines.

To ascertain the tariff rate with the approval of National Electric Power Regulatory Authority (NEPRA).

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To build, construct, maintain buildings and offices as per own requirement.

To install services & equipment, meters and other devises for the purpose of measuring power consumption.

To acquire transport of any kind which are necessary of supply & distribution of electricity?

To carry out business of running, managing software and computer programme for use in connection with the same.

To enter into agreement with firms etc, for the purpose of carrying out any business of the company.

To carry on the business & provide with associated services.

To borrow, raise funds on secured money in such a manner as the company deems fit.

To open, operate bank accounts of the company with any bank.

To act and undertake the business as mentioned in the memorandum of association of HESCO.(HESCO chart of Accounts by SGV Consultants 1997)

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CHAPTER – 4

HUMAN RESOURCE DEPARTMENT

4.1 THE HUMAN RESOURCE DEPARTMENT

The function of the HR Manager are acquiring training, appraising, and compensating employees, and attaining to their labor, relations, health and safety and fairness concerns, along with the responsibility of to look after the affairs of existing staff and also thousands retired once. Recruitment of new employee’s promotions and other incentives and all the assignment related to the employees are being done by HR Manager/department. There are also other many reasons for what HR Manager/department is important. For example an Organization won’t like to.

Hire the wrong persons for the job. Experience high turnover. Find your people not doing their best. Waste time with useless interviews. Have your company taken to court because of discriminatory

actions. Have your company cited under Federal occupational safety

laws for unsaved practices. Have some employees think their salaries are unfair and

inequitable. Relative to other in the organization. Allow a lack of training to undermined your department

effectiveness. Commit any unfair labor practices.

Within an organization a line Manager HRM responsibilities will be as followed.

Placing the right person on the right job.

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Orientation for the new employees. Further training of employees for improving their

performance. Creating working relationships and integrity. Creating and maintaining department moral. Protecting employee’s health and physical conditions.

4.3 HR & ADMN DIRECTOR

He is responsible for the formation of this department. He keep vigilant eye on each and every step taken by HR department by his immediate subordinates i.e Manager (Admn), Manager (HRM) and Manager (L&L) and Deputy Managers.

4.4 MANAGER (HRM)

Manage (HRM) is responsible for conducting enquiry of disciplinary actions from BPS-11 to above making recruitments, promotions, and Trainings etc.

4.5 MANAGER (ADMN)

Manage (Admn) is responsible to deal Audit/Draft Paras supervision of all services matters for provision of the facilities i.e. W.W.Funds, Marriage Grant, Pension, compensation to the widows etc.

4.6 MANAGER (L&L)

Manage (L&L) is responsible for handling the legal affairs of the company with and follow up the cases in the court of law. Arranging the meetings for Labour Management Relations in order to buildup cordial industrial relations etc.

4.7 DY. MANAGER (HRM)

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Dy. Manage (HRM) is responsible for making induction through out HESCO including the children of (WAPDA Employees) conducting written test/interview against various categories etc.

4.8 DY. MANAGER (TMP)

Dy. Manage (TMP) is responsible for establishment matters, such as maintaining the records of the employees, regarding Trainings, their promotions, Up-Gradations, Selection Grade, Transfer/ Postings of officers/officials etc.

4.9 DY. MANAGER (SERVICES)

Dy. Manage (Services) is responsible for dealing the services matters pertaining Medical facilities to the employees, Welfare Funds to the widow of the employees, Marriage Grants, Scholar ship to the children of employees, House Acquisition facilities.

4.10 DY. MANAGER (TRANSPORT)

Dy. Manage (Transport) is responsible to providing the transport facilities to the employees for pick and drops from offices of residence the facilities to their children for going to Schools and providing the vehicles and maintenance to officers of BPS-17 and above as per there entitlement.

4.11 DY. MANAGER (SECURITY)

Dy. Manage (Security) is mainly responsible for providing security measures to the installation of WAPDA (i.e. Grid Stations) and residential colonies for officers/officials.

4.12 DY. MANAGER (L&L)

Dy. Manage (L&L) is responsible to assist in the legal matters for HESCO company such as attending the Labour

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courts, office of Wafaqi Mohtasib, High Courts and Supreme Courts etc.

CHAPTER – 5

HUMAN RESOURCE MANAGEMENT

5.1 CONCEPT The concept of Human Resource Management has been defined by various authors. William and Keith Davis have defined HRM as:“The term Human Resource” refers to the people in an organization when managers engage in human resource (HR) activities as part of their jobs, they seek to facilitate the contribution, people make to achieving and organization’s strategies and plan. The importance of HR efforts comes from the realization that people are common element in every organization they create the strategies and innovations for which organizations are noted. As a slogan at a Union Carbide plant puts it “Assets make things possible, people make thing happen”. According to Richard L Daft “The Term Human Resource Management refers to the activities under taken to attract, develop and maintain an effective work force with in an organization”.

5.2 FUNCTIONAL PROFILE OF HUMAN RESOURCE AND ADMINISTRATION DEPARTMENT (HR&AD) IN HESCO.

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As described in the manual of Human Resource and Administration prepared by the consultant M/S Siddat Hyder Morshid & Co., the Human Resource and Administration (HR & Admn.) Department is headed by Director (HRM and Admn) and is responsible for development and effective implementation of policies and guidelines relating to various aspects of human training and professional development, performance appraisal, compensation management, competency assessment, industrial, relation, disciplinary matters, etc. On the Administration side, the Department is primarily responsible for provision of various support service including maintenance of office premises and office equipment, management of staff housing colonies, security and safety at office premises, administration of contract service, mailing, telephone, stationery etc.

The organization chart of Human Resource and Admn. Directorate is at Exhibit - 3.1. The specific responsibilities of the Department relating to Human Resource Management and Administration are discussed in following sections.

5.2.1 HUMAN RESOURCE PLANNING

Human Resource Planning is the forecasting of Human Resource need and the projected matching of individual with expected job vacancies. In HESCO, man power requirement are forecasted by various departments and sections according to need commensurate with the quantum of work and volume of consumers. These requirements are consolidated at Head office level and got approved form the Chief Executive HESCO Hyderabad by Director HRM & Admn.

5.2.2 JOB DESCRIPTION

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A job description typically lists job duties as well as desirable qualifications for a particular job (L Daft – 1996). IN HESCO Director (HRM & Admn.) reviews job descriptions and person specification of incumbents on bench mark position to identify any deviation viz a viz specified responsibilities and actual avtivities and task under taken by incumbents.

5.3 ORIENTATION

Orientation has been defied by many authors of Human Resource Management literature. Keith Davis defines it was “Orientation programs familiarize primarily new employees, with their roles, the organization, its policies and other employees.”All newly appointed employees are subjected to orientation at HESCO Regional Training Institute. The purpose of such orientation is to familiarize the newly appointed personnel with the department and its various functions heads of all the sections take part in the orientation programme.

5.4 TRAINING & DEVELOPMENT.

Training and development represents a planned efforts by an organization to facilitate employees learning of job related behaviors (Bernad Keys - 1988). Some authors distinguished the two forms of intervention by noting that the term training usually refers to teaching low level or technical employees as to how to do their present jobs whereas development refers to teaching managers and professionals, the skills needed for both present and future jobs (Richard Daft – 1996). On the job training refers to a type of training in which an experienced employee is asked to take a new employee under his wings and show the new comers how to perform job duties (Richard Daft- 1996).

Human resource manager is responsible to identify training needs in various disciplines with in the organization and

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formulates training policies and submit it for the approval of management. He also organizes in house courses and workshops by inviting professional trainers or make arrangements for participation of employees in programs conducting by various institutions.

There also exists a continuous process of on-job training for different categories of employees like Line Man, Line Foreman, Meter Inspector, Line superintendent, Junior Engineers etc, at HESCO level. Officers are also imparted various management, technical and financial training at WAPDA Distribution Academy Islamabad and WAPDA Staff College Islamabad where Jr. Management, Middle Management and Sr. Management Courses, mandatory for promotion to posts in Basic Pay Scale (BPS) 18,19 and 20 respectively are conducted.

5.5 CAREER DEVELOPMENT

A career consists of all the jobs held during one’s working life. For some people, these jobs are part of a career plan for others, a career is simply a matter of luck. Merely planning a career does not guarantee success. Superior performance, experience, education and occasional luck play an important role. Successful peoples identify their career goals plan and then take action. With modern employers continuously restructuring, in response to their competitive environment, traditional life long employment relationship with a single employee are becoming less likely. In order to cope up with such situations and reduce the employees turnover, career development is now an accepted Human Resource Strategy. Effective career planning programs may reduce turnover, specially amongst those who have the greatest career mobility, the best employees (Werther Devis 1996)

In WAPDA Career management Cell is functioning under General Manager (Administration) at head office which is responsible for all movements transfers, postings, training

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and promotions etc, of officers in Grade-18 and above. While at HESCO level Director Human Resource formulates career progression plan for all employees in consultation with the user department. He is assisted by a Manager (HR&Admn.) in this task. For example as per service rules a Line man can move upto the level of Line Superintendent and a Line Foreman/Superintendent (B-Tech Qualified) can become Junior Engineer also (Service Rules for Technical Subordinates -1996).

5.6 PERFORMANCE APPRAISAL Performance appraisal has been defined by different authors of HRM in different ways. Similarly Werther Davis has defined it in the following words:“Performance appraisal is the process by which organization evaluate individual job performance. When it is done correctly employees, their superiors, the HR Department and ultimately the organization benefits by ensuring that individual efforts contribute to the strategic focus of the organization. However, performance appraisals are influenced by other activities in the organization and in turn affects the organization’s success. Performance appraisal are about employees performance and accountability”.

In HESCO, employees performance evaluation is done at the end of the each year through Annual Confidential Report (ACR). WAPDA has prescribed two separate formats for performance evaluation for employees as well as officers. ACR is required to be initiated by the incharge of officer, section, branch called Initiating Officer (I.O.) who gives his assessment of performance of the employee covering various aspects of personal qualities and performance standards. The ratings may be outstanding, very good, good, average and below average. All upward

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movement of employees career such as promotion, move over, grant of higher scale are dependant upon ACRs.

5.7 COMPENSATION

The term compensation refers to:1. All monetary payments, and2. All goods or commodities used in lieu of money to

reward employees (Henderson -1985)R.L. Daft states that “An organization’s compensation structure includes wages and/or salaries and benefits such as health insurance, paid vacations or employee fitness centers. A company’s compensation structure does not just happen, it is designed to fit company strategy and to provide compensation equity.”

During internship the Manager (HR & Admn.) informed that HR & Admn. Department is assigned the task of reviewing salary, scales and benefits structures and conducting salary surveys for attaining internal equity between jobs as well as competitiveness with the external job environment. However, since HESCO has not yet started functioning as fully autonomous corporate entity and its work force consists of WAPDA employees on secondment (deputation), it has not designed independent wages and salary structure for employees.

It was also intimated that the present salary structure of employees in HESCO is exactly at per with that of employees of federal and provincial Governments in Basic Pay Scale 1 to 21. However, some fringe benefits like job related technical as well as qualification allowances, free use of electricity upto certain limits according to pay scales and medical facilities etc, have been extended by WAPDA on its own and are applicable in HESCO.

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5.8 SEPARATION AND TERMINATION

The employees who are found inefficient, involved in corrupt practices, are un-willing workers or have any other moral turpitude are dealt with under WAPDA Employees Efficiency and Disciplinary (E&D) Rules, 1978 and WAPDA Employees Conduct Rules under these rules an employee can be imposed penalty of dismissal, removal from service or compulsory retirement. But for taking such action comprehensive procedure laid down in the above mentioned rules are to be followed by the competent Authority (WAPDA Manual of General Rules -1995).

5.9 EMPLOYEES BENEFITS

Various benefits for serving as well as retiring employees as intimated during internship are discussed in the following sections.

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5.10 PENSION BENEFITS

Under WAPDA employees Pension Rules, 1977 an employee can be granted retiring pension on following occasions:i) He voluntarily opts for retirement on completion of

25 years continuous service.ii) On attaining the age of Superannuation i.e. 60 years.iii) He is declared permanently unfit for further service

by medical board.The pension is calculated on the basis of pay depending upon length of service rendered by the individual employee concerned pension table specifying the rates applicable is available at Exhibit-3.3 An employee can also exercise option for commutation of his pension under the rules. It means that he can opt to receive 50% of his pension in the shape of monthly payments while remaining 50% can be commuted for the life expectancy of the employee. In which case he gets payment of commutation in lump sum. The commutation table given in WAPDA pension rules which is available at Exhibit – 3.4.

5.11 LIFE INSURANCE All employees are covered under Group Life Insurance (GLI) scheme. They pay nominal premium deducted from their monthly salary in the case of death of an employee during service his family is paid assured sum according to his pay by state life of Pakistan. However, the employees in BPS 1 to 5, who are deployed on hazardous and life threatening duties are exempted from payment of GLI premium from there salaries in this case the department is liable to pay such insurance. In addition family of a deceased employee who dies while performing his duties and his death is attributed to his duties is also paid

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compensation of Rs.1,00,000.00 under the law i.e. work’s man compensation act.

5.13 TRADE UNION ACTIVITIES The Union Activities of employees are controlled at Head office level/Circle & Division Levels. In WAPDA there is a Director (Labour and Welfare) working under G.M. Administration who is responsible for looking after affairs of bargaining agents. There is a Central Labour Union at Head Office level whereas in HESCO the same union is working at regional level. The union activities are governed under Industrial Relations Ordinance (IRO – 1969). The representation of union also exist at sub-division and Divisional level.

In HESCO there is a Dy. Director (Labour and Legal) working under Director HR & Admn. to look after all matters pertaining to Labour & Management relations, as well as legal affairs.

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CHAPTER – 6

RECRUITMENT AND SELECTION PROCESS IN HR DEPARTMENT

6.1 RECRUITMENT PROCESS

Many authors have defined the terms “Recruitment” in different ways. Batman has described the term recruitment as the development of pool applications for a job. Recruitment may be internal to organization (considering current employees for promotion and transfers) or external. Similarly, Richard L Daft has defined recruiting as “activities or practices that defined the characteristics of applicants to whom selection procedure are ultimately applied”. Similarly selection has been defined by the above author as “the process of determining the skills, abilities and other attributes a person needs to perform a particular job”. WAPDA has framed selection and recruitment rules for each and every category for employees employed by it. These rules contain these rules are call service rules contain the criteria required for that particular post showing the, minimum and maximum age, minimum education qualification/experience, and composition of selection board and authority competency to allow to make appointments etc.

Being a corporatized entity of WAPDA these service Rules are also being followed by HESCO. All vacancies, other than those reserved for promotion or recruitment of employees’ children, are filled in form open market through advertisement, widely published in leading national news papers. The candidates are directed through news papers to apply against the desired posts if they fulfilling requisite regarding Age & Qualification/Experience.

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That all applications submitted by the candidates against various categories received in the Divisions are forwarded in the o/o Manager Operations circle of respective areas. The Manager Operations finally send the applications along with the list of the candidates of each category.

The applications are then processed for checking the documents as well as to check the requisite criteria regarding age & qualification, and list is prepared for acceptance and rejection of applications.

The candidates who fulfill the criteria regarding qualification & age are call for written test. The schedule of conducting examination is published through news papers or called through call letters.

The initial merit list is prepared for those candidate who are passed in the written test. The candidates who stood at the top of the merit list are called for interview on the basis of formula (i.e. Three candidates are called against one vacant post).

6.2 SELECTION PROCESS

INTERVIEWS

A selection board is constituted by the competent authority to conduct the interview of successful candidate against the posts which are advertised and to filled. The member of selection board gathered in the office as per given scheduled of interview.

The panel of interview conduct the interviews and evaluate the candidate by asking the questions related to the

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relevant field of the candidate to assessing the ability of candidate and so on.

The board finally submit the evaluation sheet showing the detail of marks obtained by the candidates in General Knowledge, Technical Knowledge and intellectual knowledge of the candidate.

The recruitment section of the HR department finally evaluate the candidates against the posts applied by the candidate and prepared the merit list based on the marks obtained by the candidates in the written test/interview and academic weightage.

OFFER LETTER/APPOINTMENT LETTERS

The successful the candidate at the top of the list are issued offer of appointment letters, in which name of the post, BPS, the salary and other benefits/facilities are allowed to the candidate. The merit list is valid for one year as per rules, and the candidates who are waiting in the merit are issued offer of appointment letters as and when the further vacancy exists.

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CHAPTER – 7

FINANCIAL MANAGEMENT AND ACCOUNT DEPARTMENT

7.1 INTRODUCTION Financial Management, as an integral part of the over-all management, is not a totally independent area. It draws heavily on related disciplines and filed of study, which inter-alia include accounting. The relationship between finance and accounting, conceptually speaking has two dimensions:

a) They are closely related to the extent that accounting

is an important input in financial decision making.

b) There are key differences in view point between

them. These are elaborated as under:

Accounting function is a necessary input into the finance function. That is, accounting is a sub function of finance. The accounting generates information / data relating to accounting is financial statement, such as the balance sheet, the income statement and cash flow statement. The information contained in these statements and repots assists the financial managers in assessing the past performance ad future direction of the firm. Thus accounting and finance are functionally closely related. (Khan & Jane – 1994)In HESCO both the disciplines finance and accounting are headed by a Finance Director. A brief description of the organization of Finance Department is given in succeeding sections.

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7.2 ORGANIZATION OF FINANCE. The organization chart of Finance Department is reflected at Exhibit – 4.1. As per said chart the hierarchy of Finance is as under:Finance Director:

Finance Director (F.D) is overall head of Finance and accounts department. He is responsible for maintaining computerized accounting and management information system, corporate planning and budget control as well as funds management. The finance director has under him managers of corporate planning and control and corporate accounting.

Manager Corporate Planning and Control (MCPC)

Manager Corporate Planning and Control (MCPC) works under supervision of F.D. and is the incharge of Finance section. He is responsible for supervising the corporate planning activities in HESCO which includes costing / pricing of electricity, budgeting, financial planning, funds and loan management.

Manager Corporate Accounting (MCA)

Manager Corporate Accounting is the incharge of accounts section. He is responsible for consolidation and compilation of accounts received from field accounting units. He performs his functions through three Dy. Manager Accounts and is responsible for preparation of financial statements and assets accounting.

FINANCE DIRECTOR

MANAGER CORPORATE ACCOUNTING

MANAGER CORPORATE PLANNING

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(Source: Brief on HESCO – 2001)

Establishment Section

Assets Sectio

n

Admn. Section

Compilation Section

Budget Section

Banking Section

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7.3 FINANCE SECTIONHESCO is a utility company which provides services of distribution of electricity to consumers through out the Sindh province except Karachi. Its source of earning, thus, is collection of revenue from consumers. HESCO purchases power from National Transmission and Dispatch company (NTDC), a subsidiary of WAPDA at a provisionally fixed purchase price of Rs. 2.50 / Kilo Watt / Hour (1000 Watt = 1 KWH = 1 Unit). The above price has been fixed by WAPDA for its all eight (8) distribution companies. The average tariff of electricity for year 1999-2000 remained at Rs. 3.57 per unit.HESCO has average cash collection of Rs. 800-900 million per month on account of sale of electricity and Rs. 10-12 million on account of new connection fees. Finance Director has to effectively manage these funds. He negotiates with commercial books and financial institutions for investment of surplus funds in maximum profit bearing schemes and accounts. (Manager Corporate Accounting, HESCO – 2001)

Corporate planning is another key functions is financial management. It includes preparation of Revenue and capital Budget. In HESCO budgeting is being made on historical basis. It means that estimation is done by keeping in view the past trends of expenditure.

Capital budgeting is done on the basis of prospective consumers and forecasted revenue increase which also is included in the over all Annual Development Program (ADP of WAPDA) controlling of budget is also a significant job of finance department.

7.4 ACCOUNTING SECTION Accounting functions of HESCO are being looked after by Manager Corporate Accounting under Finance Director. HESCO

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field formations are comprised of 56 No. Accounting units. Each accounting unit is headed by a Drawing and Disbursing / Controlling Officer who is assisted by an account officer / Divisional Accountant in discharge of his financial functions. The status of an accounting unit in HESCO is similar to that of a branch in commercial organizations each unit keeps independent record of all funds received by it form finance department. It is also responsible to keep complete record of assets held under the jurisdiction the controlling officer. At the close of each month the controlling officer send trial balance of all accounting transaction to Manager Corporate Accounting at head office. On receipt of Trial Balance from all the accounting units there are consolidated at head office level.

There are various Assistant Managers who performs different functions as shown in the organization chart of finance department at Exhibit – 4.1. The financial year begin on 1st July and closes on 30th June of calendar year. As per requirement of companies ordinance 1984, half yearly financial statements are prepared for the period ended 31st December. Similarly annual accounts are prepared after close of the year on 30th June. The financial statements thus prepared are subjected to statutory audit by professional external auditors appointed by the members / share holders in the Annual General Meeting (AGM)> The financial statements are placed before the Board of Directors who approve the accounts. The accounts are then presented before share holder in AGM to fulfill the statutory requirement of companies ordinance 1984.

7.5 FINANCIAL STATEMENTS AD ITS ANALYSIS. Financial statements are issued by corporate management, which is responsible for their form and content. It is management that selects accounting matters, compile accounting data and prepares the financial statements The accounting process or financial reporting system, which

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generates financial information for eternal users, encompasses four principals financial statements.

Balance Sheet (Statement of financial position) Income Statement (Statement of earnings) Statement of Cash flows. Statement stock holders equity.

These four financial statements, augmented by foot notes and supplementary data, are interrelated. Collectively they are intended to provide relevant reliable and timely information essential to making investment, credit and similar decisions, thus meeting the objectives of financial reporting.The balance sheet shows assets, liabilities and stock holders equity, the statement of stock holders equity reports capital transaction with owners. The income statement reflects revenue, expenses and gain and losses. The statement of cash flows includes operating, investing and financing in flows and out flows, main transactions are reflected in more than one statement so that the entire set is required to evaluate the firm. (Khan & Jain – 1994)

AS ALREADY MENTIONED IN CHAPTER -1 UNDER LIMITATIONS THE INTERNEE WAS

NOT ABLE TO INCLUDE FINANCIAL STATEMENTS OF HESCO, SO FINANCIAL STATEMENT ANALYSIS HAS NOT BEEN

DONE.

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CHAPTER – 8

OPERATION AND MAINTENANCE

8.1 CONCEPT OF SERVICE Kotler has defined service as “any activity or benefit one party can offer to another that is essentially intangible and does not result in ownership of any thing”. He further describes characteristic of service as under:“Service inseparability, service intangibility and service perishability. It means that services are produced and consumed at the same time and can not be separated from their provider whether providers are people or machine. Moreover services can not be stored for later sale or use (Kotler – 1998).Many business concerns and commercial organizations are providing different types of services to their customers like hotels they are providing boarding and lodging services to their customers Telephone and gas companies who provide services of telecommunication and energy respectively. Similarly HESCO is also a utility service provider department. It supplies electricity to house holds, shops, industries, education institutions, agricultural tube well, etc. through a complex network of transmission and distribution lines. Such service is called Distribution of Power/Electricity. It is because of distribution that WAPDA as well as HESCO is in every home.As per commercial data obtained during internship there are around 1.103 million electricity consumers of different categories in HESCO detail of which is available at Exhibit – 5.1

8.2 OPERATION AND MAINTENANCE SYSTEM For the purpose of distribution of Electricity and Maintenance of system thereof, the whole province of

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Sindh except Karachi is divided into five (5) operation circles and 2 GSO circles.

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Each circle is further divided into three to five divisions headed by an Executive Engineer (XEN) and each division is comprised of four or five sub-divisions with a sub-divisional officer (SDO) being incharge of operation sub-division and Assistant Engineer incharge of GSO sub-division. In addition each XEN is supported by Divisional Accounts Officer and Revenue Officer (RO) / Customer Service Officer (CSO) see Exhibit 5.2. The public at large comes into contact with WAPDA through these sub-divisions. There are 37 divisions and over 100 Nos. sub-divisions in the territorial jurisdiction of HESCO. The brief description of job performed by SE, XEN, SDO and RO is given in succeeding sections concerning operation only being directly related to public.

8.2.1 FUNCTIONS OF SUB-DIVISION According to WAPDA policy, a sub-division is created for every 10,000 Nos. Urban or 6000 Nos. Rural connections. A sub-division is headed by SDO and has following main sections under him each headed by supervisor organization cart of SDO can be seen at Exhibit 5.3.

a) New connection section

The section deals with registration of the consumers applications, assessing the technical aspects of the applications, processing the connection documents, maintaining various record and consumers individual files. It is through this section a new connection is given to the consumer and after observing usual formalities a meter is installed at the consumer’s premises.

b) Disconnection (DCO) & Re-Connection (RCO) Section

The section is responsible for executing disconnection and reconnection orders received from revenue officer. Case for non payment by a consumer his meter is disconnected.

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c) Complaint and Maintenance Sections

These sections are responsible for maintaining meter reading records and carrying out monthly meter reading programs, advising the Revenue Officer of the reading on meter reading forwarding list, examining inquiries concerned with functioning of meters and inaccuracy of meter readings. This is the sections against which consumers have most of the complaints like non recording of actual reading, sending meter readings without making physical visits to meters for months and reporting bogus meter readings etc.(Manual of Commercial Procedure – 1991)

8.2.2 FUNCTIONS OF REVENUE OFFICER (RO) / CUSTOMER SERVICE OFFICER (CSO)

According to WAPDA Manual of commercial procedure a Revenue Officer (RO) also designated as customer services officer (CSO) reports functionally direct to the Director Commercial and Finance Director at HESCO head office, administratively reports to XEN at division. His duties includes efficient application of billing and collection procedure. He also acts as an advisor an non technical, commercial and billing matters arising in the division. He also keeps liaison with SDOs on meter regarding, new connection, dis-connections, reconnections and bill collection matters. Organization setup of Revenue Officer is at Exhibit – 5.4. A Revenue Officer has following sections under his control:

This section is headed by a Divisional Accountant who is responsible for writing up the cash book, reconciliation of weekly

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bank statements with the cash book, reconciliation of debtors control accounts. He also acts as a financial advisor to RO in discharge of his duty.

b) General Section

This section is headed by a commercial superintendent and is responsible for receiving duplicate copies of application forms and other specified connection documents from the SDO, maintaining connection application register and file for each consumer.

c) Billing Control Section

This Section works under a supervisor and is responsible for controlling meter reading and advices to computer centre and ensuring that the billing is correct. Besides, it also carries out adjustments to incorrect bills, issuing final demand and disconnection notices, preparing certain management reports and statistics as well as dispatch of bills.

8.2.3 FUNCTIONS OF A DIVISION A Division is headed by an Executive Engineer (XEN) with four to five sub-division officers under him. XEN is required to effect speedy connection, assessment, dis-connections, re-=connections, meter changing and meter readings. Besides, they are also responsible to look into the technical aspects of consumers complaint in accordance with functional responsibilities delegated to them from time to time under various procedures and manuals. The XEN works under supervision of SE. He is also required to maintain and adequate system of communication between all offices to ensure that RO and SDOs cooperate at a high level of efficiency. (WAPDA Manual of Commercial Procedure – 1991)

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8.2.4 FUNCTIONS OF CIRCLE An operation circle is headed by a Superintending Engineer, who is assisted by Dy. Director Technical (DDT) and a Dy. Commercial Manager (DCM) in looking after the technical as well as commercial matter with in the territorial jurisdiction. SE has been vested powers of sanctioning electricity load from 70 KW to 229 KW. Load beyond this is approved by the Chief Executive. A circle is composed of three to five divisions and SE is incharge of all XENs/ROs/SDO working under him. SE is functionally under supervision of Technical Director and Administratively under the Chief Executive at HESCO Head Office.

INFORMATION REGARDING CONSUMERS PROFILE AND THEIR CONSUMPTION

PATTERN IS AVAILABLE AT EXHIBIT – 5.5

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CHAPTER – 9

CONCLUSIONS AND SUGGESTIONS

9.1 CONCLUSIONAfter completion of research the following conclusions have been observed.

1. It appears that corporatization has not been fully implemented in HESCO, WAPDA head office still seems to be controlling the affairs. Consequently, organization of HESCO appears to be partly commercial and partly Government controlled public sector organization.

2. It seems that executives and workers have not been oriented to work in a commercial environment.

3. Employees were appeared to be dissatisfied with some of aspects of services being rendered.

4. The company appears to have been running in loss. This may be due to high cost of electricity which compels people to steal the electricity. The HESCO employees seems to be unable to check such tendency due to several economic, social and political constraints.

5. Dishonest and wrong billing seems to have effect on revenue. Because consumers, receiving inflated bills appear to have a tendency to go to litigation instead of paying the bills, resulting in blockage of revenue.

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6. It was observed that penalty of late Payment was imposed upon consumers which is generally due to late distribution of bills of bill distributors. As such innocent consumers are penalized for no fault of theirs.

7. It appears that on the recruitment side the candidates hop much for appointments but on other side the less No. of post are allowed which resulted the frustration in the young generation which reflect disappointed amongst competent candidates

9.2 SUGGESTIONS After careful study of in the HR Department, the following suggestions are given for batter improvement as under:

1. HESCO may be allowed to assume full autonomous role so as to run its affairs on commercial basis instead of being controlled by WAPDA.

2. All employees and executives may be trained and oriented in modern management techniques including finance and organizational behavior.

3. Instead of Government basic pay scales the employees may be allowed salaries comparable with other privet organization. The salary of the employees may be enhanced on individual performance basis. Similarly good and hard working employees should be rewarded and unwilling should be punished.

4. The rate of electricity may be rationalized so that a common man can easily manage to pay the bill within his financial resources.

5. Honest and correct billing may be ensured so as to restore the confidence of public and to avoid blockage of revenue.

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6. The process recruitment should be fair and transparent the entire process for recruitment shall be completed with the period of three months. The merit of candidate shall be displayed on the notice board, the posts vacant lying in the department since years may be filled, yearly/six monthly so that the new blood may not be disappointed.

The officials/staff entrusted to work of internal audit shall also be trained and oriented with modern techniques, rules and regulations applicable in corporations.

9.3 References 1. WAPDA MANUAL BOOK

2. WAPDA ANNUAL BOOK

3. WAPDA RULES AND REGULATIONS

4. WEB SITE WWW.PAKWAPDA.GOV.PK

5. HESCO OFFICERS /OFFICIALS DATA

6. GARY DESSLER (HUMAN RESOURCES MANAGEMENT).