Quality improvement at Pakistan Tobacco Company, Management reaction, Outcomes of the program

1. Change Management at PTC
Group Members:
Jarrar Haider -056
Faizan Anjum -101
Saleha Hashim -155
Zunaira Shabbir -102
Date: Wednesday, 14 May
2014

2. Content
 Introduction
 Problem faced by PTC
 TQM Program
 Challenges for Implementation
 SQC Tools
 Solution for Change
 Voice of customer
 Implementation
 Results
 References

3. Introduction
• Operational in 180 countries
• 85000 people employed
• Sold 17% share of global market of
cigrates
BAT group
• Was in operations in India from 1905
• In 2005 PTC paid the government
Rs.20 Billion in excise and sales taxes
(66millions per day)
PTC
incorporated
in 1947
• 2 operational factories at Jhelum and
Akora Khattak
• ISO 9001 and 14001 certified
Factories

4. Problem Faced by Company
Market decreasing
share
• Complaints from
customers
• Quality issues for product
Statistical quality
control (SQC) tools to
cater this issue
• Different perception of
employee and managers
Objectives of program was to
Change organizational culture from classic
authoritative & shareholder-focused to a more
participative and consumer-focused

5. TQM Program
Low cost and high
quality is essential,
so need of
Efficient
and
responsive
supply
chain
Low process
wastes and
quality
product

6. Challenges for Implementation of
Change
 Behavior and resistance to program of
employee
 Motivation level was low
 Series of complementary program
introduces
◦ WOW (Winning in our World)
◦ Business Excellence Program (MRP)
◦ Supply Chain Modification

7. SQC Tools
 Variation in product characteristcs
 Cigarette is more lucrative product
◦ Highly taxed
◦ Taste dependent (question origion)
 For company fighting with variations
was important

8. Solutions for Modifying
Behaviour of Employee for
Change Company embarked on the SQC implementation
program with the following outlines:
 Planned to get assistance of highly qualified outside
consultants for the training & education
Educate
line
Mangers.
Educate
shop floor
employee
s (Team
Members)
Developing
graphs and
use on
machines
manually.
Introduce
an online
system.

9. Failure and Modification
 Insufficient commitment of top
management, to create enthusiasm in
the participants.
◦ 40% dropout from course on second day
◦ Only 50% participant could manage to get
“Course Attendance Certificate ”
 Threat of failure came on the
shoulders of the consultant

10. New Team for Change
 New hired consultant(highly respected
and experienced ), proved to be as
ineffective as the first one was.
 Management now tough on different line
 Approached academia professor
 New team formed of two consultant and
one professor

11. Problem Sorted Out
Low literacy rate of the workforce is an
impediment.
Age profile of the workforce is contributing to the
lack of enthusiasm for leaning new tools
Most workers have not been to classroom
environment for more than 20 years
• Finding it difficult to adjust to the environment
The lack of confidence to acquire the same level
of skills on the new tools
• loose their personal leadership

12. Recommendation by team
 Brain storming with site session
participants
 Listen to their feedback and views to
make a more realistic action plan
 First step towards VOC (Voice of
Customer)

13. VOC (voice of customer)
 After consideration
◦ Venue changed for sessions (Islamabad)
◦ Properly invited events for session
 Objectives communicated to training
manager
◦ This not for us (trainer didn’t quoted example
of relevant industry)
◦ What is in it for me (extra work view of
employee)
◦ What are the benefits for PTC

14. Alternate Route
 Fact-finding team found itself facing a set
of ground realities totally different from
assumed
◦ Need of aligning the training contents to the
training needs
◦ The site management should carry out all the
development work using indigenous resource
◦ Training of the employees should be done by
someone from within.
◦ There should reward and recognition system
in place for high performers

15. Implementation
 Training material developed in Urdu
Language
◦ With relevent industry examples
 Course completed successfully
◦ All participants got above 60% marks in final
exam
 Crashed program offered for senior
machine operators on 7-quality tools
◦ Concerned about product, weight,
circumference and pressure-drop
 Web-based quality information system
developed to display graphs on CRTs

16. Reward and Recognition
 Comprehensive test was scheduled at
the end of each course
 Top 3 position honored by professors
for recognition
 Dinners arranged for participants

17. Results (period starting 1999 to 2007)
 Factory Production Floor: (MQI)

18. Results (period starting 1999 to
2007)
 Manufacturing Quality Index

19. Results (period starting 1999 to 2007)
 Ex-market

20. Results (period starting 1999 to 2007)
 Market Complaints

21. Conclusion
Program proved to be very successful
Within one year the shop-floor employees started
using control charts, Ishikawa & Pareto diagrams and
histograms for analysing product and process quality
and taking corrective actions.
The enthusiasm was so high that people started to
volunteer for the training course

22. References
 Company Reference
Turab Ali Khan
Product Assurance Manager
Pakistan Tobacco Company Ltd. Pakistan
 Web references
◦ http://en.wikipedia.org/wiki/Pakistan_Tobacco_Company
◦ www.ptc.com.pk/group/sites/pak_7shbxn.nsf/.../medMD933EBD.p
df
◦ http://www.brecorder.com/company-
news/235:pakistan/1161783:pakistan-tobacco-company/
◦ http://www.ptc.com.pk/group/sites/PAK_7SHBXN.nsf/vwPagesWe
bLive/DO7T5LR5?opendocument&SKN=1
◦ http://www.pakistanbusinessjournal.com/b2b-directory/pakistan-
tobacco-company-ltd_26812.html
◦ http://www.ptc.com.pk/
◦ http://www.ptb.gov.pk/

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