The document discusses a case study of Masood Textile Mills, a Pakistani textile and apparel company. It provides background on the company's origin, growth, structure, strategy, and workforce. It then compares the company's old and proposed new performance appraisal and reward systems. The old system was subjective and linked rewards inconsistently to performance. The new system aims to be more objective, structured, and tied to business strategy by basing rewards on timely order completion and quality. The document concludes with recommendations to address employees' concerns with the new system and ensure it is implemented fairly.

1. THE MASOOD
TEXTILE MILLS
Case Study- March 2017
Vikas Bhardwaj –Enrollment No 15392
With Thanks submitted to Dr Bagchi

2. Understanding of the organizationUnderstanding of the organization
 Origin and growth
 Mr Shahid Nazir a second generation entrepreneur ran now a vertically integrated in textiles and apparels . Over
the years MTM had evolved by making capital investment on new machines and hired MBA’s in various
departments .It is ranked No3 in Pakistan and has turnover of $28 mio
 Climate
 In recent years WTO had phased out assured business due to quotas ,hence it was imperative that operations are
made more competitive and buyers stringent QS an productivity standards .
 Organization growth stage appears to be consolidation and renew which required greater collaboration,
realignment to overcome internal and external challenges , optimizing resources to increase the ROA.
 Structure
 Matrix structure where CEO had 2 GMs i.e Mills & Garments) responsible for operations .The 5 key verticals are i.e
Production, Finance, Merchandising, IT and Procurement & Production Planning. supported laterally by Finance,
Marketing, IT. Information sharing is top-down and formal. Decision making appears centralized.
 Strategy
 Company began with textiles but had grown now to include apparels in its portfolio. MTM after bidding etc ,
obtained Purchase orders in international market. ROA depended on timely delivery, Near zero defect production
capacity, flexibility to adapt to customers requirements. Other businesses included transport, oil mills, coke
bottlers etc.
 Staff
 Management levela-M4,M3,M2,M1 has Technical and MBAs as Managers;
 Skilled/Unskilled-S4,S3,S2,S1. Company had invested in training and included MBA along with technical staff for
management functions raining was imparted, PA were infrequent
 Systems
 Processes existed without much change and perceived bureaucratic by the employees . New PA proposed by
management
Masood Textile Mills 2

3. Comparison
N
o
Characteristi
cs
Old Performance & Reward System New Performance & Reward System
1 Linkage with
Business
Strategy ,
PA must be balanced mix of subjective
and Objective performance parameters
( wrt organization, department, individual).
In this case only workers had few
objective parameters. The responsibility of
quality was with workers only and
Managers excluded.
The system was very structured and connected with
organizational rewards and objective .No subjective parameter
Based on effectiveness i.e delivery of the order on time and
accepted quality.
2 Fairness to
employees
Since the PA was predominately
subjective and depended on assessing
superior bias and opinion is bond to
creep in.
Unfair if the full order delivery got delayed or required
external auditor team working on Purchase Order due the
factors beyond control of employees, No incentive is payable,
hence demotivated and disengaged them.
Also if the PO delivery terms upset by poor planning or
resource management , inefficiency of other departments full
team is at loss.
3 Acceptance &
motivation of
employees
Dissatisfied as it had predominant
subjective parameters wherein superior's
individual discretion may lead to bias.
was at managements discretion
Highly objective. Not confident of its workability due its
complexity It fostered team work, rewarded based on
hierarchy, volume of order
4 Timeliness/
Ongoing
Time and frequency had been
inconsistent and increment not related to
performance
Frequency of PA not defined. Assumed that incentive payout
will be annual based on Purchase Orders executed.
4 Administratio
n
Infrequent. Limits of annual increase was
freezed with Managers getting
opportunity of increase 12-15% & skilled
workers- 5-6%.
Complex and implementation was to be seen
BoC and BoD available to ensure fairness and grievance
handling of the new system
5 Other flaws No channel available to ensure sits
operations
In a PO team at a same level/hierarchy Individual contribution
was assumed to be same and rewarded equallyHence larger
contributors can be recommended by project team head or
Department head ..
Incase one project id delayed workers may stop working on it

4. Recommendations.
1. Transparency -Since the employees were skeptical , the concerns can be alleviated
through workshops all levels in MTM esp among skilled and unskilled workers
2. Inclusion-Workers be included in the BoD and BoC
3. Justified Rewards- Laggards responsible for the low production and quality be
reprimanded / penalized as per the gap. HOD assessment to identify high and poor
performers through efficiency parameters rating and reward differentially.
4. Control- A team be constituted or BoC be assigned to monitor the PO as Project
management guidelines
5. Fairness- Agreed that the company absorbs the penalties and losses due to delay
in deliveries, however for rejections /delays due to designing or planning errors,other
department may not be deprived of due rewards.
6. First among equals- Some orders from a new prestigious client ,though not big
volume but may be critical .Insuch case management must have provision to prioritize
and add weightage to the order
7. Frequency of PA- Performance Assesment be quarterly/ monthly for interim
performance review, counseling provided to keep team members motivated and
focused.
1. Transparency -Since the employees were skeptical , the concerns can be alleviated
through workshops all levels in MTM esp among skilled and unskilled workers
2. Inclusion-Workers be included in the BoD and BoC
3. Justified Rewards- Laggards responsible for the low production and quality be
reprimanded / penalized as per the gap. HOD assessment to identify high and poor
performers through efficiency parameters rating and reward differentially.
4. Control- A team be constituted or BoC be assigned to monitor the PO as Project
management guidelines
5. Fairness- Agreed that the company absorbs the penalties and losses due to delay
in deliveries, however for rejections /delays due to designing or planning errors,other
department may not be deprived of due rewards.
6. First among equals- Some orders from a new prestigious client ,though not big
volume but may be critical .Insuch case management must have provision to prioritize
and add weightage to the order
7. Frequency of PA- Performance Assesment be quarterly/ monthly for interim
performance review, counseling provided to keep team members motivated and
focused.