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Case Description
The National Agriculture Research Council (NARC), in the year 2016, decided to initiate a new
project. Started as a small initiative, the project’s primary reason was to aid in the extraction of
olive oil in Pakistan. Like all oil extraction facilities, the National Agriculture Research
Council’s site reserved for this project operated via the use of machinery. In order the ensure the
organizations and facilities to hold frequent and regular check-ups for the capital good and repair
them accordingly. These actions fall under Maintenance, Repair and Operation (MRO), which is
The condition at oil extraction plants operated by the National Agriculture Research Council
does not comply with the requirements discussed above. This mainly due to the organizational
structure and hierarchy used by the council. NARC consists of numerous departments. Once the
council decided to initiate the new olive oil extraction project and plant, these departments were
not in the favor of this decision. This is primarily attributable to the fact that the departments’
conventional policies and monopolies did not allow for the creation of a new extraction unit.
As a result of this lack of support from the departments of National Agriculture Research
Council, the new olive oil extraction site was confronted with a number of issues. The upper
management did not conduct any regulatory activities and this, combined with continual
negligent behavior from the supervisor, resulted in deterioration of the extraction facility. In
addition to that, the upper management and supervisor responsible for the new plant and
extraction site failed to provide the employees with proper leadership and support. While a
leader is supposed to motivate the subordinates, and aid them in solving issues, the management
scarcity of skilled labor. The extraction plant comprised of complicated machinery, which
required some level of technical knowledge before successful operation. This increased the
demand for skilled labor, further aggravating the labor scarcity problem.
Apart from that, the extraction site also required a proper MRO plan to ensure that the installed
machinery continued operating smoothly. The design and approval of this plan required the
supervisor to ask for a permission from the senior management after informing them of the costs
associated with maintenance. Since the extraction plant did not have any proper plan or methods
for maintaining and upgrading its machinery and technological infrastructure, it became prone
wear, tear and deterioration. As a result, it became inefficient and faced a decline in its
performance levels.
Introduction of NARC
The case under consideration takes into account the company National Agriculture Research
Council (NARC). As the name suggests, the company is engaged in the research related to
agriculture. The company is a government entity based in Pakistan. The entity was initiated in
1984 with a view to provide a platform to further research in the area of agriculture. Since
Pakistan is an agriculture based economy, the work of the entity plays a vital role in the survival
The work of this institution is to conduct researches on the agricultural products that are
currently grown in Pakistan. In addition, the institution also explores the variety not yet grown in
Pakistan but there is potential in the country for the growth. In order to carry out such researches,
1
NARC, "National Agricultural Research Centre," NARC, Islamabad, April 11, 2013, , accessed
December 05, 2017, http://www.parc.gov.pk/index.php/en/2013-04-11-06-13-50/narc-islamabad.
the institution employs a host of employees from the scientific and managerial background. This
is to ensure that the research work as well as the management of the company proceeds in the
right direction fluidly. Moreover, in order to carry out the work of research and exploration, the
institution also acts as a bridge between other government level and provincial institutions to
Furthermore, NARC also has state of the art technology available in the country. This is to
ensure that the research carried out on the crops, both existing and the new ones, is accurate and
provides the desired results. The institution has instruments such as electron microscopes and
ultracentrifuges that make it a leader in the field it works in. Furthermore, to analyze the data
collected with the help of these instruments, the institution utilizes highly skilled employees.
Moreover, these employees are equipped with fully functional high-performance computers as
well. Therefore, NARC is a state of the art research council working under the government of
Pakistan 3.
In order to carry out the functions assigned to it, NARC works on the following vision:
Diversification of agriculture
2
NARC, "National Agricultural Research Centre," NARC, Islamabad, April 11, 2013, , accessed
December 05, 2017, http://www.parc.gov.pk/index.php/en/2013-04-11-06-13-50/narc-islamabad.
3
Ibid
Decentralization of research management and planning4
Literature Review
The consumption and production of edible oil in Pakistan is far away from being the same. The
country, due to its increasing population and consumption of food, is faced with an extreme
deficit of edible oils as well. The following graph shows the condition of the country’s oil
As the figure above shows, the country’s production and consumption of edible oils was close to
each other in the mid-nineties. However, the deficit started in late nineties and began to grow far
apart with time. Therefore, the country was faced with a deficit of edible oils which it then
4
NARC, "Vision of NARC," Vision, December 12, 2013, , accessed December 05, 2017,
http://www.parc.gov.pk/index.php/en/about-narc/2013-12-12-09-18-58.
5
Muhammad Ali, Manzoor Hussain Memon, and Syed Arifullah, "Edible Oil Deficit and Its Impact on
Food Expenditure in Pakistan [with Comments]," The Pakistan Development Review, 2008, 5.
imported. Therefore, as it is clear from the chart above, Pakistan, despite being an agriculture
One such oil in which the country is working in deficit is olive oil. The increasing awareness in
the population has led to the popularity of this edible oil. Since NARC is assigned with the duty
of carrying out the research and exploration of crops that are or can be grown in the country, the
institution looked was assigned with the duty of exploring the country’s potential regarding the
production of the olives and the processing of the fruit into oil7.
The deficit of olive oil as discussed above in the study has led to a huge import bill to the country
Pakistan. The country, as per the sources, paid 1.784 billion on the import of olive oil for
consumption purposes. This commodity is imported at heavy rates from Spain and Italy.Not only
do these countries charge premium rates, the transportation costs are also borne by the importer.
Therefore, the country has to suffer from extra costs due to these added outflows. Keeping this in
view, NARC conducted a survey and a proper research to identify the areas in Pakistan that have
potential to cultivate the fruit olive. Once the research was carried out successfully, the
institution found that the areas of Potwar in Pakistan are best suited to the production of Olives.
On the other hand, the areas of Rawalpindi, Khushab and other adjacent areas are also
considered to be very resourceful and appropriate for the cultivation of olives. In order to
promote the production of olives in the country, the Punjab government imported 20 million
plants and the farmers were also provided with a subsidy to carry out the farming of olives. The
subsidy was set at 70 percent for water resources and 60 percent for the irrigation purposes8.
6
Ibid
7
Muhammad Ali, Manzoor Hussain Memon, and Syed Arifullah, "Edible Oil Deficit and Its Impact on Food
Expenditure in Pakistan [with Comments]," The Pakistan Development Review, 2008, 5.
8
NARC, "Project of Olive Promotion," Project of Olive Promotion, 2012, , accessed December 05, 2017,
http://www.parc.gov.pk/index.php/en/olive-project-of-olive-promotion.
Furthermore, NARC was also a part of the project designed to promote the production of olives.
The project was a result of the MoU (memorandum of understanding) signed between the
government of Pakistan and Italy. The project was valued at a total cost of Rs.382,153, 016. The
aims of the project included the expansion of olive cultivation in the country. In addition, the
project also aimed at setting up new facilities in the country that would be able to process the
olives and turn them into oil and other products. Lastly, the project also aimed at providing
technical training to the people employed in the field of olive cultivation and processing to
enhance the production of the fruit as well as the products derived from olives9.
As discussed above, the country is an agrarian economy but still faces a deficit in terms of olive
oil production and consumption. As a result, NARC started a small olive oil production unit
which started functioning in 2016. The plant was imported from China at a cost of around one
million. However, the plant was not installed in its original condition and was modified before it
was installed in Faisalabad. The plant modifications were made by the plant maker. The plant
1. Cleaning of olives
2. Grinding the olives into paste
3. Mixing the paste
4. Separating the oil
5. Filling of oil in bottles
Two plants were set up at the center. Each extraction unit had the capacity of 50 kilograms per
hour. Therefore, the two plants had a total capacity of 100 kilograms per hour. The extraction
efficiency of the plant enables it to extract 20 percent of the weight of the olives as oil.
Therefore, the plant extracts 200 grams in one kilogram. The plant functioned for 16 hours a day
9
NARC, "Project of Olive Promotion," Project of Olive Promotion, 2012, , accessed December 05, 2017,
http://www.parc.gov.pk/index.php/en/olive-project-of-olive-promotion.
10
NARC, Five Years PARC Business Plan (2013-18), report (Islamabad: NARC, 2013).
in two hour shifts. It was this plant that faced difficulties due to the management issues faced by
it. The plant also had mismanagement and poor maintenance of the machinery it utilized.
Therefore, the plant was at a disadvantage consistently and the wear and tear of the machinery
led to the final demise as discussed in the case above. In case proper technical and and HR
management was carried out in the plant, the situation could have been different. This is because
HR and technical management have important roles in the smooth running of an organization.
Human resource is one of the most important assets of a company. The company uses its human
resource for the creation of value that it later transfers to its stakeholders. Good human resource
is a function of effective human resource management (HRM). This is because effective human
resource management gives direction to the company employees. This direction is useful if the
company has to work coherently to achieve common goals. Achievement of common goals is the
Human resource management, as the name suggests, is related to the management of human
resource that a company employs. This includes planning, leading organizing and controlling the
human resource. Like the management of any resource, human resource management also
requires the manager to understand the functioning of the resource before attempting to manage
it. However, there is a difference in understanding other manageable resources that a company
11
NARC, Five Years PARC Business Plan (2013-18), report (Islamabad: NARC, 2013).
12
John Bratton and Jeffrey Gold, Human resource management: theory and practice (London: Palgrave Macmillan,
2017), 3.
operates and human resource. Therefore, the managers of human resource have to be specifically
There have been examples recorded in the history about organizations that have achieved success
by employing good HRM practices. A host of HRM theories exist that explain the concepts
associated with HRM and how it can positively affect the organization. These theories focus on
of a firm. Effective HRM is usually a product of top management support and the cooperation of
employees working at the base level. This makes effective HRM a function of relationships
between the employees and the managers. The company managers usually lead the employees
into the direction provided by company's mission and vision. This direction, if properly
followed, will lead to the achievement of goals which is considered very important as discussed
earlier 14.
Effective Human Resource Management is when the manager acts as a leader instead of a
dictator. The company management has to play the role of leaders and motivate the employees
instead of directing them. This can be achieved in various ways. The management of the
company should focus on understanding the needs of the people working as employees. In
addition to the monetary needs, the management should also identify the non monetary needs of
the employees. This will send a signal to the employees and will motivate them to carry on the
In addition, as the work of Parameswari and Yugandhar shows, human resource management is
an important factor in ensuring that the company grows as planned. This is because the
13
Ibid.
14
John Bratton and Jeffrey Gold, Human resource management: theory and practice (London: Palgrave Macmillan,
2017).
15
Dipak Kumar. Bhattacharyya, Human Resource Management(New Delhi, India.: Excel Books, 2012).
organization is constituted of the members that run it. If the company employees are motivated,
the individual employees will grow. As a result, the company, as an entity made of the
employees, will grow. Therefore, it is clear that regardless of the company being public or
private, the role of human resource management is clear and evident. Similarly, NARC also
In addition to that, the presence of a good HR management system in an organization leads to the
framework ensures that the company employees are valued. This is ensured by designing a
reward and appreciation system that values the input of the organization. Therefore, the
employees, seeing the value assigned to their work, will be motivated further to work hard and
add value to the organization. In the same essence, NARC could also avoid the situation if it had
Companies, nowadays, work with teams that are working to bring additional value to the
organization. These teams are normally cross functional with the presence of members of all the
departments in them. Therefore, organizations are now creating value by utilizing these teams.
The utilization of these teams, however, efficient, leads to conflict among team members. The
role of HR management comes when the issues are to be resolved. The members are initially not
comfortable working with each other as their methods are not the same. The role of HR
16
Naga Parameswari and V. Yuganhdar, "The Role of Human Resource Management in Organizations,"
International Journal of Engineering Technology, Management and Applied Sciences 3, no. 7 (2015):.
17
Ibid.
18
Hassan Danial Aslam et al., "Importance of Human Resource Management in 21st Century: A Theoretical
Perspective," International Journal of Human Resource Studies 3, no. 3 (2014): , doi:10.5296/ijhrs.v3i3.6255.
As mentioned earlier, the work of HR management is to ensure that the employees are satisfied
with their jobs. This is achieved by designing appropriate payment and bonus framework. Once
the HR management designs the aforementioned frameworks correctly, the company employees
are treated fairly. The employees are paid properly and are provided with appropriate bonuses as
well. This leads to greater motivation and the employees work harder and more focused19.
environment. By carrying out the aforementioned functions, the HR management team ensures
that the environment of the company is genial. This is to ensure that the company employees
work in an environment where they feel comfortable. The HR management achieves such an
important role in the organization by being a mediator among the organizational members in case
of a conflict. On the other hand, HR management also ensures that the code of conduct is
followed by the people. By ensuring this, the department ensures that the employees are in line
Another important role of the HR management is to ensure that the employees are communicated
the ethical requirements and expectations. This includes the ethical standards related to the
fulfilment of duties assigned to the employees and managers alike. This ensures that the
employees do not use unfair means in order to achieve the goals they set. This will lead to ethical
attainment of goals. Furthermore, this will also ensure that the company management and
employees are using the prescribed means to add value to the organization21.
19
Hassan Danial Aslam et al., "Importance of Human Resource Management in 21st Century: A Theoretical
Perspective," International Journal of Human Resource Studies 3, no. 3 (2014): , doi:10.5296/ijhrs.v3i3.6255.
20
Ibid.
21
Tracy Wilcox and Diannah Lowry, "Human resource management and ethics," Human Resource Management in
a Global Context, 2012, , doi:10.1007/978-0-230-35885-0_6.
In addition to that, another role of HR management in the organization is to ensure that the
organization obtains the resource it needs. This means that the organization recruits the
employees that it needs. This will lead to the matching of the job to the right employee. This is
an important role since it is normally human resource department that advertises the job and
recruits the personnel. The description of job requirements as well as the outline of the company
culture and ethics to the new employees at the time of recruitment is a function carried out by the
common issue faced by firms of technical operation. Consider the olive oil extraction plant
operated by NARC, the firm was not able to succeed because the company did not assure that the
This is an important concept for organizations and setups with high initial costs and maintenance
requirement. Since organizations like these require specific skills. A manufacturing plant
requires specific skills for the maintenance and running of the machinery installed. Therefore,
the HR management has to ensure that the company recruits the right personnel. In addition, the
technical management is responsible for the provision of correct technical training to the
employees from time to time. This is to ensure that the employees do not lag behind on the
technical changes brought in by the organization. In case newer machinery is installed, the
organization’s management has the role to train the employees about the maintenance and repair
22
Mark A. Youndt et al., "Human Resource Management, Manufacturing Strategy, and Firm
Performance," Academy of Management Journal 39, no. 4 (August 1, 1996):.
23
Ibid.
Human Resource Management Lapses and the Failure of
NARC Plant
Reviewing the case of NARC and the HR and technical management roles discussed above, it is
easy to identify certain errors that were present in the management of the plant. If the plant was
managed properly, the failure of the plant could have been avoided. A clear mismanagement is
evident from the behavior of the supervisory staff. As the case dictated, the managers were
Ali, M., Arifullah, S., Memon, M.H. and Salam, A., 2008. Edible Oil Deficit and Its Impact on
pp.531-546.
NARC. "National Agricultural Research Centre." NARC, Islamabad. April 11, 2013. Accessed
islamabad.
NARC. "Vision of NARC." Vision. December 12, 2013. Accessed December 05, 2017.
http://www.parc.gov.pk/index.php/en/about-narc/2013-12-12-09-18-58.
NARC. "Project of Olive Promotion." Project of Olive Promotion. 2012. Accessed December 05,
2017. http://www.parc.gov.pk/index.php/en/olive-project-of-olive-promotion.
NARC. Five Years PARC Business Plan (2013-18). Report. Islamabad: NARC, 2013. 1-20.
Bratton, John, and Jeffrey Gold. Human resource management: theory and practice. London:
Palgrave Macmillan, 2017.
Bhattacharyya, Dipak Kumar. Human Resource Management. New Delhi, India.: Excel Books,
2012.
Parameswari, Naga, and V. Yuganhdar. "The Role of Human Resource Management in
Organizations." International Journal of Engineering Technology, Management and Applied
Sciences 3, no. 7 (2015): 58-63.
Aslam, Hassan Danial, Mehmood Aslam, Naeem Ali, and Badar Habib. "Importance of Human
Wilcox, Tracy, and Diannah Lowry. "Human resource management and ethics." Human
0_6.
Appendix A: Interview Questions
3. What were the main policies ensuring smooth functions at the organization?
4. Were the staff properly trained about the functioning of the plant?
5. Was the staff recruited on the basis of their skills in the area?
9. Did the centralized HR management have enough power to resolve the issues decisively?
10. Were the employees communicated about the ethical requirements of the organization?
12. Was there a proper feedback system between the employees and management?