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Submitted By :
Hafiz Zain Ul Abidin
Roll No:16
BS8th (Morning)
Session 2015-19
Department of Commerce
THE ISLAMIA UNIVERSITY OF BAHAWALPUR
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TABLE OF CONTENTS:
HISTORY
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V. ANALYSIS OF STRATEGIC FACTORS (SWOT) ........................................................................ 17
A. Situational Analysis ......................................................................................................................................... 17
VIX. REFERENCES…..…………………………………………………..….…………………………………………21
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ACKNOWLEDGMENT:
I am heartily thankful to our Strategic Management teacher, Sir Shahid Yaqoob, whose
encouragement, guidance and support from initial to the final level enabled us to develop the
subject Strategic Management. With his dedicated lectures we were able to practically
understand and apply what we have learned in the classes.
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History:
Pakistan Tobacco Company Limited (PTC) is a subsidiary of the British American Tobacco
(BAT) p.l.c. The Company was incorporated in Pakistan in 1947 making it one of the first
multinationals in Pakistan. Starting from a single warehouse near Karachi port, the
Company is now the largest cigarette manufacturer in Pakistan. For PTC it has been a
voyage in pursuit of excellence since 1947 driven by the vision to be the “First Choice for
Everyone”.
Our story of 70 resilient years encapsulates the key milestones we have thus far crossed,
intertwined with the meaningful contribution we have made along the way in social and
economic terms. Our journey continues as we endeavor to outdo ourselves in setting the
highest standards of corporate excellence.
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I. Current Situation:
A. Current performance:
Since the start of the new century, in order to better understand and accordingly respond to our ever-
changing consumer base, we decided to get regular market research surveys done from an independent
international research agency called Nielsen. It helped us better divide our brands market wise and gave
us knowledge on what exactly the consumer trends are. On ground, it helped us with the numeric width,
the share drop or share increase, which brand is performing better than others and where. This helped
us in streamlining our processes to an extent that we made a sub function of marketing which is solely
drawing conclusions and trends from the data we receive directly from one end of our supply chain –
our retailers.PTC has the 3rd Largest TM&D force in the BAT world.
Strategic Posture:
Vision:
Satisfying Consumer Moments
“We believe that by being the world’s best at satisfying consumer moments, we will become the
leader in our industry. Consumers are at the core of everything we do and our success depends
on addressing their evolving concerns, needs and behaviours.”
Mission:
Champion Informed Consumer Choice
We need to continue to ensure that our adult consumers are fully aware of the choices
they are making when they purchase our products. We recognise that we have a
responsibility to offer a range of products across the risk continuum, but we will also
defend people’s right to make an informed choice.
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Strategies:
Pak tobacco company is built on the idea of a responsible corporate citizenship thereby
managingenvironmental, safety & occupational health matters as an integral part of our
business. Infulfilling this responsibility Pak Suzuki adheres to the following principles:
1)We are committed to provide top quality products to the satisfaction and requirementof our
customers.
3)We recognize the interrelationship between energy and the environment, and we promote
the efficient use of energy throughout our system
5)We minimize the discharge of waste materials into the environment by utilizingresponsible
pollution control practices.
6)We will continuously seek opportunities to improve our adherence to these principles. As it is
clearly mentioned in their Vision Statement that to be excellent all around, and they always
operate in Environment friendly. And their Product will always be the environmentfriendly.With
the globalization of markets, greater foreign competition, and the reduction of entry barriers, it
becomes all the more important to benchmark a company’s financial indicators ona worldwide
basis. World stock markets have recently witnessed a return to fundamental financial analysis.
Sound management as opposed to hype will in the long run generate shareholder value.
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Objectives:
We have set some primary and secondary Objectives.
Primary objective:
We wish to provide high quality tobacco to its dealer and to its customers so they can satisfied from us.
Secondary Objective:
We also insure our dealer also satisfied from our quality and we also provide them the facility to
generate reasonable profits from our products.
BOARD OF DIRECTORS
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Mr. Mueen Afzal (Chairman & Non-Executive Director)
He is graduated with first class honours from Government College, Lahore, before getting his M.A. from
Corpus Christi College, Oxford, in philosophy, political science and economics in 1963. He joined the Civil
Service of Pakistan in 1964, and served as Finance Secretary in the provinces of Baluchistan and Punjab.
He was also Federal Secretary Finance. He finally served as Secretary General, Finance and Economic
Affairs between 1990 to 2002. Since leaving Government in 2002, Mr. Afzal has worked in various
capacities in the corporate sector as well as in academia. At present he is on the boards of Murree
Brewery Co. Ltd and Akzo Nobel Pakistan. He joined the PTC Board in 2003 and became the Chairman in
2007. He was awarded the Hilal-e-Imtiaz (HI) in 2002 for distinguished public service.
Syed Javed Iqbal has been with the Company for the last 20 years. He
joined the Company as a Management Trainee and has held various
key positions in the Finance function in PTC as well as in British
American Tobacco Group. He has served in BAT South Korea as Finance
Controller and later in Global Headquarters in London as Finance
Manager for Global Marketing. In 2011, he was appointed as Finance
Director for the Swiss Business Unit looking after 5 European markets
based in Switzerland. He came back to Pakistan in 2014 as Director Finance & IT for PTC. In July 2016, he
became the Managing Director & Chief Executive Officer of PTC. Mr. Iqbal has an MBA with majors in
Finance & MIS.
Mr. Zafar Mahmood, who is also the former Chairman WAPDA, has
served the Government of Pakistan for 38 years at policy formation
and implementation level, before assuming responsibilities as
Chairman WAPDA in April 2014. He has served the Federal
Government as Secretary Textiles Industry, Secretary Industries,
Secretary Water & Power, Secretary Petroleum & Natural Resources, Secretary Commerce and Secretary
Cabinet. He has also served as Chairman, Punjab Public Service Commission, Consul General Istanbul,
Vice Chairman Export Promotion Bureau, Secretary Punjab Education Schools. Mr. Mahmood holds a
Master’s Degree in Economics, LL.B. and Post-Graduate Diploma in Development Administration from
Manchester University. He joined the PTC Board in 2016.
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Hae In Kim (Non-Executive Director)
Mr. Wael Sabra joined BAT in 2003 in Lebanon and since then he held
various key senior positions in the Finance function across Middle
East, Africa and most recently South Asia. In 2010, Mr. Sabra was
appointed as Finance Director Democratic Republic of Congo before
moving to South Africa in 2012, where he was assigned to take up the
role of Southern African Markets Finance Director in charge of
Mozambique, Angola, Zimbabwe, Malawi, Zambia, Botswana,
Namibia and Swaziland. In July 2014, he moved to Cairo as Finance
Director North Africa Area covering Egypt, Algeria, Morocco, Tunisia, Sudan and Algeria. In August 2016,
he moved to Islamabad as Finance Director South Asia Area. In his 14 years with the British American
Tobacco Group, he has been an executive board member in several BAT operating companies across
Africa. Mr. Sabra is a holder of a Masters Degree in Finance from University of Florida and is a Certified
Management Accountant (CMA) from the Institute of Management Accountant. He joined the PTC
Board in 2016.
Policies:
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We are committed to conducting our business operations in a manner that sustains the
environment and protects the health and safety of our employees, by adopting a proactive
approach to using cleaner technologies and safer systems of work while ensuring compliance
with all applicable national laws and regulations and BAT’s Environment, Health and Safety
policy.
We seek to control and reduce our impact via the ‘3 Rs’ principle: Reduce, Recover, Recycle.
Our programmes cover energy and water conservation, air and soil protection, afforestation,
minimizing waste and minimizing the use of natural resources, agrochemicals, and raw
materials.
As one of the leading tobacco businesses, we recognize the paramount importance of the health,
safety and welfare of all employees and non-company personnel in the successful conduct of our
business. We are therefore committed to the prevention of injury and ill-health and strive for
continual improvement in our health and safety management and performance, through setting
clear objectives, including the monitoring and measurement of key performance indicators.
We provide and maintain safe and healthy working conditions, equipment and systems of work
for all employees and other associated personnel; and provide instruction, training and
supervision as may be required for this purpose. Our approach is based on hazard identification
and risk assessment, for the purpose of effectively controlling health and safety risks in the
workplace.
We are committed to conducting our business operations in a manner that sustains the
environment and protects the health and safety of our employees, by adopting a proactive
approach to using cleaner technologies and safer systems of work while ensuring compliance
with all applicable national laws and regulations and BAT’s Environment, Health and Safety
policy.
We seek to control and reduce our impact via the ‘3 Rs’ principle: Reduce, Recover, Recycle.
Our programmes cover energy and water conservation, air and soil protection, afforestation,
minimizing waste and minimizing the use of natural resources, agrochemicals, and raw
materials.
As one of the leading tobacco businesses, we recognize the paramount importance of the health,
safety and welfare of all employees and non-company personnel in the successful conduct of our
business. We are therefore committed to the prevention of injury and ill-health and strive for
continual improvement in our health and safety management and performance, through setting
clear objectives, including the monitoring and measurement of key performance indicators.
We provide and maintain safe and healthy working conditions, equipment and systems of work
for all employees and other associated personnel; and provide instruction, training and
supervision as may be required for this purpose. Our approach is based on hazard identification
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and risk assessment, for the purpose of effectively controlling health and safety risks in the
workplace.
The weakness of PTC is biggest in term of its little less market share as compared
to Lakson Tobacco company. According to certain studies there is no proper
arrangement for the labour refreshment at the company,
Opportunities:
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Threats:
Government policies to discourage the uses of tobacco items is the bigg threat for
the company because due to the government policies the ptc sales decreases day by
day.So we say that due to the awarness policies and high taxes effect the company
badly.
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b. Technological Environment:
Technological factor also very important and we haven’t control on it. Technology isgrooming
with the passage of time. People also want that the product that they have is full
of technology. We never control on technology for example you launched the product last
year and your sale volume on that time is very high but after sometime due to latest invention
alots of substitute exist in market which affect on your business so you can’t hold on it.
c. Legal Environment:
As all countries, Pakistan also has some legislation about each sector. But like
developingcountries it is hardly being imposed by authorities. The corruption, smuggling and
black marketing have been supported by Government related officials. The undue favor is given
tothose business men who have been politically affiliated and hardly any legal suite is carriedon
against them. Such unethical activities destroy all law and legislation.
C.Task environment:
1. Potential new entrants:
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In PTC this can be described asking the New Entrant category of Porter's 5 forces, we can see
that it would be tremendously difficult for another car manufacturer to enter into the market.
The rate at which the industry is changing does not allow for new entrants to come into the
market very easily, and the cash investment for a new firm to produce massive quantities of
cars is in the billions.
•Suppliers are expected to make deliveries of parts in small quantities several times a day.
•PTC, by reducing its part inventory, has been able to speed up production
costs,save money by not letting parts sit on the shelf, andimprove its relationship with parts
suppliers, which rely on PTC for their revenue.
4.Threat of substitutes:
•Consumer preference is changing (Due to government awareness programs)
•Setting up integrated Tobacco manufacturingfacilities may require higher capitalinvestments
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•Pakistan is also likely toincreasingly launch awareness programs that can make difficult for the
new companies to enter in the market and compete with PTC so we can say that the threat of
substitute is minimized.
B. Organizational Culture:
The culture of PTC is so friendly and work in the organization like a team.this can also increase
the productivety of the company.The company also make a lot of focus on the employees.
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Because employees are the assets of the company. Company use this asset in a productive way
and increase its productivity.
B. Corporate resources:
1. Marketing:
PTC products continue to enjoy customer’s confidence and have been successful in market.
During the year the company sales declined due the government awareness programs so due to
that they focus on exports because due to earning foreign reserves they thought government
also facilitate them and their sales increased.
2.Finance:
PTC is a well reputed company of the company as well as of the world.This is beneficial for
the company because can easily got financed from the banks as well as from other financial
institutes.
- Detail study of drawings, SIS, SES and other standards for the component
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factors on firm business objectives has been discussed and conclusion has been drawn
accordingly.
6. Human Resource Development and Management:
When training about certain field is offered to the works company by the mother company PTC
workers themselves decide whether to take the offer or not, the departmental Heads suggests
names of workers to top management and then names are announced. The training could of six
weeks, one year or three years. As they told us that before sending any employee to
training, bonds are signed from employees and because the employees becomes an important
asset of the company for which company is spending so much money by sending them for the
training in foreign countries and they are bound to share their knowledge and experience which
they have gain toothier employees at the plant in order to increase the performance regarding
Quality.
General Environment.
Product Market.
Customer Market.
Product Market:
Sale Volume and Trend.
Growth Rate.
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Customer Market:
Customer market and customer buying behavior can be categories.
Demographic Factor.
Life Style.
Recommended strategy:
PTC gives importance to the rise of global market share by evolving into new markets
and wants to grow their capacity by organic growth, merger and acquisition.
For organic growth, PTC is more focused on their strategic global sectors, which offer
good brand expectation for long run, especially Premium and International Brands.
According to 2007 annual financial report, Global Drive brands have growth by 10%
while International brands by 5%. PTC has target of optimizing the role of Global Drive
Brands and are ready to utilize opportunities for their expansion in “Value for Money”
and “Low Price Segments”. They also want to maintain or establish good stances in
priority markets by defining itself as the leading and the greatest profitable ever. They
also consider carrying on with their development, innovation and offering customers
distinctive products within their brands. PTC also concentrates in trade marketing and
distribution by focusing on Direct Store Sales that helps to develop excellent and
profitable relationships with the potential customers.
For productivity,PTC concerns about best utilizing its worldwide resources to boost
profits and raise finances for reinvesting in the industry. To be competitive,PTC has cut
costs over supply chain while improving product quality and pace for emerging into the
global market, also utilizing its people and capital effectively.
For Responsibility, PTC strictly follows their Business Principles with the stakeholders,
which is comprised of Mutual Benefit, Excellent Corporate Conduct and Responsible
Product Stewardship. PTC conducts qualitative standards of business with employees
globally. They also encourage sensible tobacco regulation by balancing consumers’
choice and social interests, reducing harm and ascertain the company sustain and
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flourish. For harm reduction strategy, PTC will lessen the tar and toxins consistently from
the products and launch a new generation product that has fewer risks to health.
Lastly, for building a Winning Organization, PTC provides good working environment
and follows strategy that produce leaders who have devotion, be innovative and who
can facilitate team in order to build the company worldwide.
During 1990, PTC was intended to concentrate completely on tobacco that provoked
and altered the Group. Later in 1995, PTC considered to have confidence and an aim to
be the leader amongst tobacco industries and hence developed a strategy. To lessen
supply chain complications and accumulate expenditure, which were also part of the
strategy, PTC closed some of its loss incurring companies, like, in 2005, South Hampton
plant was closed down.
VII.Implementation:
PTC must have to adopt modern and latest technology and made huge research and
development so that the impact of tobacoo items and its effect on consumer health can be
minimized this can helpful for its flourishment otherwise it cannot sustain itself in the market
successfully.
PTC choices on vital situating impact its participation with providers. The
provider's unique arrangement of upper hands, center abilities and strategic offers
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needs to change alongside that of other tobaccoo companies. Such changes,
unavoidably, will be reflected in quality, consumer loyalty and considerably client
security. Some would see this as a by-result of the vehicle producer's key move
coordinated by its initiative. Others think the administration ought to consider such
effect as a major aspect of the change administration close by vital arranging shifts.
Whatever it is, the key is the arrangement, particularly with corporate culture,
individual’s capacities, acknowledgment of stress and weight, and the capacity to
organize and change.
The new initiative absolutely has felt the weight. It is the duty of the pioneers to
deal with the arrangement and coordination between vital course and working .
Ideally, the review emergency will be dealt with yet again as a chance to adjust its
lean generation culture and its operation magnificence capacities with its craving to
use new innovation, to keep sourcing from the globe while proceeding to remain
on the No. 1 platform. A change as of now is obvious. PTC has turned out to be
less guarded and has reacted rapidly to new protestations of deformities. Authority
is do not missing anymore and now gives off an impression of being driving from
the front.With regards to the different issues,PTC development procedure for the
proceeded with acknowledgment and high caliber at reasonable and minimize its
health issuesso that it can betterly sustain in the market and grab more and more
profit from the market and become world one leader.
In view of the book titled "7 Lessons for Leading in Crisis" composed by George (2009), PTC needs a
sound pioneer with a solid, durable arrangement.
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PTC make items that is less dangerous for the people so they can easily purchase the items from the PTC
must have to promote corporate social responsibility so people can relate with the.
PTC needs an emergency group detailing specifically to him, working all day, every day to get issues
settled for all time. He ought to include the world's top quality specialists to his settle it group and listen
deliberately to their recommendation.
Administration ought to have required its best designers to get to the underlying driver of this issue and
each other quality issue being accounted for.
Take after True North - PTCmust leave concealing, assume individual liability, and subject himself to
extreme addressing by controllers and the media. At that point he ought to make an individual sense of
duty regarding each PTC iclient to repair the harm, including purchasing back damaged autos.
f. Be on offense:
Concentrate on winning now - Coming out of this emergency, the market will never appear to be
identical. Suzuki can't hold up until all its quality issues are settled. It must play safeguard and offense at
the same time. To win, PTC brings to the table propelled components and unrivaled quality, better an
incentive for shoppers
The Government has taken steps to address the prevalent economic challenges, especially the balance
of payments crisis and the rising trade deficit. At December end, key monthly indicators showed visible
signs of deceleration in domestic demand, the current account deficit is gradually narrowing, and
financial inflows are increasing, reducing pressures on the Country’s external accounts. Although, these
developments are encouraging and have served to reduce some economic uncertainty but challenges to
Pakistan’s economy persist: (a) the current account deficit remains high; (b) fiscal deficit is elevated; (c)
core inflation is persistently high; and (d) local currency remains weak and vulnerable to further
devaluation. While addressing the economic challenges, the Government is focused towards not only
stabilizing the economy but also driving economic growth. Looking ahead, 2019 will be a challenging
year for the Company as it will need to counter the challenges presented not only by a tough economic
environment but also by the unique dynamics of the tobacco industry. In the future, the Company aims
to drive business growth by focusing on delivering the following objectives and by countering the
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related challenges and now we are focuings on the exports way so that government can also protect us
and we also avail this opportunity for the success in future.
References:
www.PTC.com.pk
www.PTCofficail.com
www.britishamericantabacco.com
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