By IRTEZA SIDDIQUE
May 06 -12, 2002
Pakistan State Oil (PSO), the largest oil marketing
company (OMC) of Pakistan, has witnessed a major turnaround in the
last three years. Despite its huge volumes and high earnings, the
company was identified in the past with ineffectiveness, declining
returns on investment and for having a generally inauspicious image
among its customers — factors that were leading to consistent
erosion in the market share of PSO's key products to the company's
With the present government's emphasis on
revitalizing the public sector organizations and reorganizing them on
professional grounds, the PSO Board of Management was reconstituted
with professionals from the private and public sector. The board was
then given the mandate of running the company independently. The Board
through its Audit & Human Resource committees ensures complete
transparency in financial and other aspects of management.
The new management then took a variety of new
initiatives to regain the company's 1eadership position. At heart of
this effort was the New Vision Retail Development program that
entailed the development of tastefully designed outlets at strategic
locations throughout the country. Equipped with most modern facilities
like electronic dispensing units, convenience stores, Business Centers
and, most of all, a more customer friendly staff, these outlets have
gone a long way in restoring the customer confidence in PSO. In
addition to this, various new products and services like CNG stations,
PSO CNG Oil, Mobile Quick Oil Change and Mobile Quality Testing Units
have led to considerable improvement in the company's standing in the
market. So far, 356 New Vision stations have been established and the
number would expand further in the coming years.
These initiatives have been supported by strong
marketing and sales promotion campaigns, resulting in increased market
share and profitability for the company. Despite adverse economic
situation, PSO has been able to maintain its profitability and has
been declaring record dividends for its shareholders.
To support this new verve in marketing and sales
promotion, PSO has been consistently improving its storage facilities.
Its 26 depots and nine installations spread throughout the country,
having a total capacity of about 800,000 metric tons, are not only its
traditional source of strength but also hold vital importance in the
country's overall strategic economic planning. PSO has been constantly
upgrading its depot facilities, introducing modern techniques in
product handling and transfers.
The company is focusing on enhancing and upgrading
storage facilities, which represent 80 per cent of Pakistan's total
storage capacity for petroleum products. To handle the increased
volumes of Fuel Oil and HSD PSO is enhancing its storage and handling
capacity at its Port Qasim Terminal. This enhanced capacity will also
give PSO the flexibility to store other companies' products and earn
additional income for PSO, a step that will generate money for PSO
through other sources.
PSO also has taken up the task of bringing its POL
tank lorry fleet at par with international standards. As a first step,
products in Karachi are being supplied through new tank trucks
equipped with satellite tracking system. Gradually, this system will
be expanded to other parts of the country.
As a company cognizant of its responsibilities
towards its various stakeholders, PSO is now placing a very strong
emphasis on Health, Safety & Environment (HSE) compliance.
Implementation of HSE standards at all PSO storage and distribution
facilities is being ensured while its lube blending plants have
already attained the ISO 9002 certification.
With the deregulation of POL pricing, PSO has been
the first company to pass on the benefit of price changes to its
customers. Prices of Fuel Oil have been considerably reduced on
various occasions while price formula of the Oil Companies Advisory
Committee (OCAC) is being implemented for all other products. Price
displays at the company retail outlets ensure the provision of POL
products at the right price.
Alongside the development of its physical
facilities, PSO has undertaken significant reorganization in its
management. Strengthening its ranks by trained professionals at
various levels, development of the Business Unit concept and
decision-making based solely on business considerations, PSO is now
ideally placed to respond to the challenge that it may come across.
As the oil marketing industry moves towards greater
deregulation and increased competition because of the entry of new
competitors, PSO is ideally placed to meet the challenges of the
future. And for this, the credit goes to the present government!