REPORT ON HUMAN RESOURCE MANAGMENT

TAPAL

PREPARED BY: MUHAMMAD UMAIR BADAR

(FA07-BB-0062)

ZEESHAN BANA

(SP07-BB-0179)

SUBMITTED TO: MR. M. HANEEF

COURSE: COMPENSATION MANAGEMENT

 LETTER OF TRANSMITTAL

To
Mr. Muhammad Haneef
Course Instructor
Compensation Management

Dated: November 21st, 2009

Respected Sir

As this report is concerned in which we have discussed about the

actual findings gathered by the means of research and surveys
would fulfill the requirements regarding this report.

We are very thankful that you gave us this kind opportunity from
which we have learnt how to deal with people in the industry and
this report has also helped us to gain loads of information on
Human Resource and Compensation Management in the
organizations.

Yours Faithfully

Muhammad Umair Badar

Zeeshan Bana
 Perfection was the watchword I had in mind when I
started working on this project. However people
generally agree that man can only strive to approach
excellence but never actually achieve it. Exquisite
perfection is rather a trait of God, and by his grace, I
have tried very hard to make this thesis an excellent
one.
First and Foremost I’d like to
thank almighty Allah for giving me the strength and
knowledge to successfully complete this report.
I would also like to thank Mr. M.
Haneef for his time, assistance, guidance & instructions;
he gave to us in the friendliest manner through out this
thesis, which could not have been successful without his
dedicated attention & guidance.
This project has improved my
understanding to the subject Compensation
Management, which will surely help us in our
professional life.
 Table of Contents

Sr. Topics
No.

1 Executive Summary

2 The Selling Process

3 Staffing and Recruitment

4
Training and Development

5
Monitoring and Evaluation

6 Training and Development Approaches

7 Salary and Compensation

8 Territory Management

DATA COLLECTION
• Articles from newspapers

• Interviews

• Website

DATA PROCESSING
• All data bring together like recommendation of instructors.

• All theory work has been done in M.S Word.

 Executive Summary
From the dimmest of history when around 2727 B.C. a few leaves of a wild
shrub tea blew into the royal bowl of boiling water being sipped by the
legendary Emperor Shah Nung, known as the Divine Husbander as well as a
patron of arts. Tapal Tea here brought tea from the royal bowl to the common
man’s cups as the most sought after beverage the country over.

Under the management of the founder’s son, Faizullah A. Tapal, the company
continued to grow and innovate. Currently it is being managed by the
founder’s grandson, Aftab F.Tapal who has continued giving further strength
to the foundations of quality laid by his family. After studying abroad, Aftab
F.Tapal returned to introduce professional management and unique
production ideas into the business. His progressive outlook resulted in the
total automation of the tea plants in Karachi.

Their motto “never compromise on quality” remains the byword on the lips of
all engaged in producing Tapal Tea that has resulted in customer’s brand
loyalty and their unflinching addiction. The testimony of their quality has
made them the first tea company in Pakistan to earn the ISO-9001: 2000
Quality Certification, the symbol of supreme quality standards.

Pioneer of the Danedar category in Pakistan, Tapal’s Danedar remains a firm

favorite around the country with its grape-nutty appearance, rich golden
color and a strong refreshing taste.

In fact its popularity is such that several multinationals have launched their
own versions, but Tapal remains the original and ultimate Danedar because
of its unique color, aroma and taste. Color and a strong refreshing taste are
its most significant attributes.

Tapal is proud to have been a part of Pakistan’s history since its inception. As
a company they have grown and flourished together with the great nation.
Since 1947, the name Tapal has been associated with great tasting teas.
Founded by Adam Ali Tapal, the company first started marketing a number of
quality blends to tea shops around Karachi.

The success of Tapal’s teas soon broke all popularity records and sales grew
by leaps and bounds. Under the leadership of Faizullah A.Tapal and currently
Aftab F.Tapal with his team of professionals, this success has been
consolidated and carried on.

Today Tapal is the largest, 100% Pakistani owned Tea Company in the
country. They are proud to be the innovators and producers of countless
unique blends and creators of different tea categories in the country.

Tapal’s brands include leaf blends such as Tapal Special, the highly popular
Danedar and the recently launched Safari PF 1. In the Dust/Mixture category
Tapal counts brands such as Tapal Chai Family Mixture, Mezban and Chenak
whilst its refreshing green tea brand is called Jasmine.
A number of common factors unite all Tapal brands – consistent high quality,
flavor, aroma and taste, the creation of unique blends from the finest tea
leaves and state-of-the-art packaging to retain flavor and freshness. This
winning combination is the reason that Tapal’s quality brands have enjoyed
favor with countless consumers for over 50 years, and a cup of Tapal tea has
become a tasteful tradition in households around the country.
 THE SELLING PROCESS
Tapal tea is one of the leading brands of tea in Pakistan. The company
like any other organization has to take into consideration the factors
that may help them to sell their product to their respective target
markets. Therefore, it indulges in the following preliminary steps of the
selling process.

Prospecting: -

This is the first step of the selling process, which Tapal would takes
into consideration when dealing with its product market. The first
aspect of this step is that of identifying the target market. Tapal
analyzes its target segment, which largely comprises of households as
well as offices. After identifying its market Tapal devises a strategy
that would enable them to compete with its competitors and therefore
lead to an increase in the market share. To generate sales lead is
another facet of the prospecting process that Tapal takes into account
i.e. it has to ensure that the identified target segment would actually
be needing their product or not. The reason this aspect is necessary is
that the more Tapal is aware of its customer’s needs, the more easily
they can locate them and help them fulfill those needs. Lastly, the
qualifying aspect, in which Tapal ensures that the identified market
actually needs their product and would readily buy their product when,
introduced in the market.

Qualifying: -

After identifying the prospects, Tapal determines whether these

prospects are valid or not. This basically involves the MAN approach,
which is the abbreviation for money, authority and need. In Tapal’s
case, the money aspect may not play an important role, the reason
being that it has major competitors like Brooke Bond and Lipton;
therefore, it would not want to spoil its chances of losing its market
share to these companies, by pricing their tea higher than their
competitors.
The authority aspect regarding Tapal tea varies according to its target
segments. The reason being that in this aspect the company would
have to especially target those people of the target market who
actually take the decision of purchasing the product. Therefore, in the
case of the market of households Tapal focuses on the women of the
households who actually take the decision of which brand of tea is to
be used. Regarding the target of the offices, the authority is in the
hands of the management of the company who may specify their
preferred brand of tea.
Need is the last aspect of the approach, in which Tapal determines the
need of its target market. Tapal ensures that by introducing its tea in
the market, it would be able to satisfy the needs of its consumers. In
this aspect, Tapal’s marketing strategy should be taken into
consideration, which basically emphasizes on the fact that in order to
feel fresh and renewed energy it is essential to have Tapal tea.
Therefore, when consumers in the target market would feel tired and
drained out, in order to refresh themselves they would need a hot cup
of Tapal tea.

Pre-Approach: -

Who is the customer, is the first question that Tapal asks themselves.
This has already been answered by in the previous steps of the selling
process. Determining the needs of the customers have also been
discussed, but how to convince the customers that the tea produced
by Tapal is the only tea that would satisfy the customer’s needs. The
job of the Tapal tea’s salesperson is to ensure their customers that
their tea is the only tea that is strong enough to help the person feel
refreshed and renewed again.
Additional information may always prove to be essential for any
organization to further understand their customers; therefore, Tapal
too carries out surveys to further identify the needs of its customers.

UPGRADE

Tapal should develop a strategy for prospecting that involves an

organized and active system for generating sales leads and qualifying
potential buyers. Therefore, Tapal should follow a systematic approach
like networking, which involves acquiring new contacts and cultivating
existing ones. The help of Tapal’s product managers, market planners
and sales managers can play an important role in helping the sales
person obtain knowledge about his target market. Tapal should also
carry out surveys to find out whether their target market has a need
for the product. Tapal currently relies on heavy marketing through
media however they should also consider cold calling as it would
enable them to have contact with their potential customers and their
needs.
Tapal must update its strategies for achieving its sales objectives. The
sales manager and the sales force at Tapal must also acquire
knowledge regarding the competitors, as it would help them in revising
their strategies.
 STAFFING AND RECRUITMENT
Recruitment is basically concerned with the process of finding and
attracting capable applicants for employment. We had an in depth
conversation with the General Manager at Tapal who told us that each
department had different needs and requirements and according to
that employees were attracted to the company He also told us that
Tapal being a tea company did not require very highly educated staff
except for in certain departments where they had to look into the
education and qualifications of the applicant. The machines completed
most of the work and the workers only needed to be there to operate it
correctly. But, in other important departments, the applicant must be
able to have good communication skills in order to be able to
understand the company policies and workings and also, to be able to
implement his goals by clearly defining them to his subordinates.

Tapal’s Recruitment Process

Tapal undertakes no internal recruitment because of the simple reason
that they get workers from wherever they are located because mostly
they require skilled to semi-skilled workers and only a few must have a
good educational background. If at all, they send their best
technicians, mechanics etc. to train the workers located in other towns
or cities but none are transferred anywhere.

Tapal’s external recruitment process has to be extremely efficient

Tapal sends ads through newspapers and depending on the job
requirement they write down the job evaluation criteria. They then
receive applications and based on their qualification, experience,
education and locality they are then selected and placed in the jobs.
Some applicants have to undergo job tests, especially for those jobs
that require technical skills off the applicant. The manager mentioned
that Tapal also uses aid from Private Placement Agencies when
undertaking recruitment. Tapal benefited from services provided by
advertising agencies (whose names were not disclosed) which
informed the company about not only the availability of employees but
also the employee competence and ability. Tapal uses massive
advertising to promote their products; thus the agencies know exactly
the type of employees the company requires. These advertising
agencies ask applicants to send their résumé’s to them, and the
agencies then pass them on to the company for further processing.

Tapal recruitment process is not only reliable but also efficient as well,
in the sense that the company has never been faced with the problem
of poor production or low morale. Apart from the problem of temporary
employees, the company has never been in a fix to lay off a worker,
unless of course the employee decides to leave due to his own will.
Tapal, since these past few years has proven to be an efficient
company with a dedicated, competent and motivated workforce.

Selection
It can be said that in Tapal, Selection is central to the success of
production.

Tapal follows a series of steps to decide which recruits should be hired.

Before the final hiring decision is made the HR department evaluates
each applicants potential capability through the use of valid
procedures. Three inputs that allow the selection to proceed are:
- Job analysis,
- Human Resource plans
- Recruits.
They may also be considered as challenges to the selection process at
Tapal as they impose restrictions. Job analysis of the General Manager
at Tapal comprises of the second highest rank in the company and he
is responsible for all Human Resource activities, labor issues and
production processes.

Tapal does not believe in selection planning since they don’t have
internal recruits. For jobs like Brand Manager and Production Manager
they have large selection ratio, but for some jobs they also have a low
selection ratio. But for most of the important jobs they usually have a
large selection ratio, which means variety while selecting the right
person. So, some of these important issues have to be taken into
account by Tapal. Like all the other companies Tapal follows a series of
specific steps for selection of employees. Each of these steps has
different requirements and different efforts are involved and they are
discussed in depth below.

The first step involves the Preliminary interview or the Courtesy

Interview at Tapal gives a very welcoming reception in this interview to
all job applicants. This interview is a matter of good public relations
and is vulnerable to the image of Tapal as a company.

The second step of selection at Tapal involves Employment Test. This

test assesses the match between the applicants and job requirements
at Tapal. Tapal holds no cross-cultural biases against any of the
applicants at any level. Applicants all over the country are free to apply
without any hesitation. A job test is carried out with the help of a close-
ended questionnaire. This helps the company to know about the
applicant’s preferences, desires and also to test validity.). Besides this,
the company designs the job application form in such a manner so that
it briefs the company about the background of the applicant. It consists
of questions asking about the caste, creed, religion, National Identity
Card number, and experience and also requires them to attach a
passport size photograph. This gives them the basic legal information
required about each applicant.

The third step is the Selection Interview. Once the list of all applicants
is reviewed, an in depth conversation is conducted to evaluate an
applicants acceptability.

UPGRADE

We believe that Tapal should have job postings for internal candidates
as it relies largely on external candidates this will motivate the current
employees at Tapal to look forward for promotion and perform better
as internal recruits are more aware of company policies and have an
experience with the working conditions and therefore, they have less
expectations attached to the job. Tapal when making selection
decision, should undertake a Background and Reference Checks of
their applicants. This would help them to overcome the problem of
credential distortion and to guarantee that the applicant is credible
enough to work in their organization. A Supervisory Interview must be
carried out since the supervisors are more involved with the
employees in the Production Department, the reason being that they
are more technically inclined towards their job. Tapal should hold
medical evaluations to ensure that the employees especially in the
Production and Sales Department meet the health and safety
standards. Tapal is being faced with the problem of temporary
employment and thus, in order to overcome this problem and sustain
their security they should have a permanent, available and reliable
workforce.
 TRAINING AND DEVELOPMENT
Training and development is a planned effort to facilitate employee
learning of job-related behaviors in order to improve employee
performance. Training and development are very important for both
the employee as well as the organization. It does have a certain cost
associated with it but it is returned back in the form of increased
productivity because of the experience of the trained employee.
Although training and development are interchangeable terms, they
have different meanings.

Training and Development Objectives of Tapal

Keeping in consideration the future demands of the employees Tapal

has certain palpable objectives that focus on increasing the
productivity of the organization as a whole. These objectives are
focused on short-term as well long-term basis and act as standards
against which performance is measured.

• The present purpose of Tapal is to efficiently and effectively

increase productivity in terms of improvement in skills,
knowledge, and abilities.
• To accomplish the challenge that Tapal is faced with which
includes the need to provide specific staff development and
training opportunities that prepare colleagues for future change,
for example in relation to new technology for learning and
teaching, management development and leadership.
• At Tapal Training is focused to enhance skills to meet the future
needs of developing societies, increases capabilities for
 sustained national growth, technology and innovation to bring
about performance improvements
• Tapal recognizes that employee skill and competency
development is an investment in people and is essential for the
continued success of Tapal and the career growth of employees.
• Tapal ensures that employees have the skills and competencies
necessary for them to perform in their current position. Training
and skills development will also be available to employees to
enhance their skill base for their own career development.
• One of Tapal’s main objectives is to continuously develop and
train existing employees and Improve effectiveness of company
training programs.

Tapal believes in a system which constantly believes to the ever-

changing needs of the external as well as internal environment these
needs accompanied with the needs of the employees are achieved
through remarkable teamwork right from the top management to the
employees of the company.

Steps To Training And Development

Needs Assessment

The HR department of Tapal Pvt. ltd. emphasizes on assessing the

needs of the new and existing employees so as to assist them
diagnose current problems and future challenges. They determine the
current state of skills, knowledge, and abilities of the current and/or
future employees so they are aware of organizational goals, climate,
and internal and external constraints.
They require a need assessment form, which is provided to the
personnel department for any recommendations, the main purpose of
this form is to:

• Identify the desired or necessary conditions for organizational

and personal success.
• Focuses on the necessary job tasks/standards, as well as the
skills, knowledge, and abilities needed to accomplish these
successfully.
• To identify the critical tasks necessary and not just observe our
current practices.
• And to distinguish actual needs from their perceived needs -
wants.
 The training and need effectiveness assessment form enables
Tapal to discover and identify possible solutions of certain problems,
opportunities, weaknesses and help them consider changes to be
made or directions to be given like.

• Problems or deficits. Are there problems in the organization,

which might be solved by training or other activities?
• Impending change. Helps discover problems, which do not
currently exist but are foreseen due to changes, such as new
processes and equipment, outside competition, and/or changes
in staffing.
• Opportunities. Could we gain a competitive edge by taking
advantage of new technologies, training programs, consultants
or suppliers?
• Strengths. How can we take advantage of our organizational
strengths, as opposed to reacting to our weaknesses
• New directions. Could we take a proactive approach to move our
organizations to new levels of performance For example, could
team building and related activities help improve our
productivity

The second part of Tapal’s training need and effectiveness

assessment/monitoring form is required to be filled after the training
selection and need assessment part has been done to indicate the
effectiveness of the training program and weather the objectives
behind its purpose are clear or not.

Monitoring and evaluating effectiveness of training

The monitoring and evaluating effectiveness form of Tapal enables in

evaluating and monitoring the training needs to ensure that the
provision is both appropriate, of high quality, and constitutes an
effective use of resources, and helps managers at Tapal ensure that its
original objectives have been fulfilled. It is basically designed to assess
whether participants have identified and retained significant learning.

Program Content

Training programs at Tapal Pvt. ltd. are developed by considering staff

development needs implied by the implementation of the range of
current and developing strategies. The content of the program is met
by data collected through appraisals and other employee
feedback/consultation processes during a certain time including the
evaluation of events offered in that time period. The training program
of Tapal is geared towards meeting needs and priorities identified at
corporate level and at areas of individual levels.
All training and development offered is closely monitored and regularly
reviewed to ensure that the provision is both appropriate, of high
quality, and constitutes an effective use of resources.

Cost effectiveness of the program

Tapal has an annual budget of rupees 25 - 50,000 per employee for its
training program depending on the hierarchical levels. Tapal believes
in investing in its employees to get the maximum outcome. Looking at
the various benefits that are achieved the organization feels that 25-
50000 Rs. per employee is a small price to pay. A good measure of
cost effectiveness is to see the payback. Employees who feel that the
organization cares have higher productively, greater loyalty and
satisfaction in their work place. They feel that when organization cares
so much for them they need to give back something in return. Tapal
trains its employee which causes a reduction in other cost, such as the
turnover is lower, people may be recruited from within the
organization, the problem employee obsolescence is take care of.

The concept of training and developing is new in Pakistan, however

Tapal has been one of the few organizations, which have been
proactive in the human recourse field. Over the years Tapal has
realized the importance of training and developing its employees. It
feels these programs are very cost effective cause experience has
shown them that the benefits of such program far exceed their costs.
Additional the cost is short term but the benefits are long term.

Training And Development Approaches

Basically there are two approaches for training and development.
1) On-the-job-approach
2) Off-the-job-approach

1) ON-THE-JOB-APPROACH:

This approach comes into action when the training given is on the job.
By this it means that an employee is trained while doing work, right on
the working spot. An experienced employee or a trainer continuously
teaches the new hire to deliver the best, and also keeps an eye on him
to check whether the training is result oriented or not. Some
techniques of this type of training that take place at Tapal are
explained below.

• Job Instruction Training:

 New employees go to each and every department to expand their
vision, as well as to enhance the experience requirements of work.
This increases their ability to perform better. This benefits the
growth and personal grooming of the employee. It also results in an
increase in the potential of the new hire, which ultimately adds to
the organization’s effectiveness. For example, At Tapal, training
supervisors are at round all the time and in all the departments to
check the employee performance. Training supervisors are sent to
departments according to their personal expertise such as blending
department, laboratory, packing, computer department, quality
control etc.

• Coaching

Coaching is an important part in the training and development

process. In this approach, the new employee is under supervision
of a more experienced employee, who trains the trainee in such a
manner that he can perform exactly the same as his trainer does.
For example, Tea is a very sensitive product, and needs great care
when being processed. A slight mistake may bring a change in the
blend, which would affect its taste. Mismanagement in filling may
cause weight variations from packet to packet, and a minor
mistake in packing can affect its quality greatly. To overcome these
problems senior employees coach the new hires for perfection.

2) OFF-THE-JOB-APPROACH:

This approach comes into action when the trainee is trained not on the
job, but is trained at a similar environment off the job. By this I mean
to say that he is trained in a similar environment with all the same
materials used in the jobs so that he can learn about his job without
disturbing the actual process.
Some techniques of this approach that are used at Tapal are given
below.

• Lectures

Employees are trained through a lecture program as well. They are

informed about their duties and responsibilities. It creates
awareness among the employees. It reviews compliance with
company’s policies, plans, procedures, laws and regulations. E.g. At
Tapal there are very friendly relations between the management
and the employees, and this is also because of the lectures that are
given to new employees, which tell them in detail about the
policies, laws, procedures and regulations of the company, so that
 if any employee has an objection he may raise that point or simply
leave the organization.

• Warehouse Training

The HR department conducts this form of training in order to

familiarize the employee with different job routines. The employee
has to learn the specific tasks. For example, at Tapal, inventory
management is an essential task. The workers are sent to the
warehouse and have to undergo training associated with
maintenance of the serial numbers, production batches, labeling
etc. This type of training is important because fresh tea is to be
delivered at the shops and this is only possible if it is delivered on
first in first out system. For this accuracy the employees are trained
in such a manner so that there is no mistake in the delivery, which
can result in a loss for the organization.

• Action Learning

This type of training takes place at Tapal at regular intervals to

enhance decision-making qualities in the employees. It benefits the
employee to go ahead in his career and also benefits the
organization to gain from the employee’s increased potential and
experience. For example, Employees are given a problem and are
said to find the best possible solution in a certain time period. This
practice benefits the employee on decision-making skills, which
ultimately result in the increased efficiency of the organization.

• ISO Training Program

ISO a symbol of quality. Every ISO certified firm is welcomed
by the consumers, and creates a good image in their minds about
the company. Today when everybody wants quality in everything
that they use, they also ask for quality in tea as it is the highest
consumed beverage in Pakistan. Tapal is the first ever Pakistani
Tea Company with an ISO-9001 certification. It received the
certification in 2000. ISO focuses on quality control; therefore it
trains Tapal employees in a manner that they are able to maintain
the quality as expected by Tapal customers. This supports the
motto of Tapal “Never compromise on quality”.

UPGRADE

Tapal’s Human Resource Department does quite an efficient job of

bringing together the employees to produce effective results. As
training and development plays a significant role in the organization,
therefore, Tapal also considers it a very important element for its
success. It deals with external as well as internal issues well before
setting up its training program.

After research and analysis of the training department, there are a few
strategies that Tapal can implement to enhance the performance of
the training and development function of its organization. These are
strategies that can be applied in the short as well as the long term of
the organization. If adequate measures are taken to follow these
recommendations thoroughly, then short-term applications can
enhance the organization in the long run as well.

They should enforce role-playing in the organization. The Pakistani

women are not given their due rights in the organization. They should
be involved in the senior management so that they feel like an integral
part of the organization. There should be a role-playing day organized
where both the men and women can understand the importance of
each other’s roles. It will build better understanding between
employees.

Besides the use of lectures as a job technique, video presentation

should also be considered an important technique of training
employees. Visualization of a job helps to enhance the level of
understanding about the job itself, its requirements and its standards
expected from the employee.

Tapal deals with complicated technology. Dealing with such difficult

technology can make an employee feel scared of his job. Explanation
concerning the basic problems of the machines would help the
employees to fix minor problems themselves, rather than approaching
the supervisor. This would reduce the workload of the supervisor and
even decrease the wastage of time in order to repair the problems. The
implementation of this action would also decrease the fear of high
technology machines.

Women are usually sexually harassed and discriminated in the

Pakistani society. As a successful, private Pakistani organization, Tapal
should develop laws for protection of their female workforce. This
would increase the number of eligible female applicants. An
improvement in the culture of the organization would also be felt if
such a strategy is implemented, as it would bring the higher
management closer to the lower staff. It would also build better
understanding.

Even though Tapal sends its employees to workshops held both outside
and inside the country. To keep pace with the changes occurring in the
global organization, potential employees should be sent to training
programs held by international firms, and to more seminars and
workshops. This not only provides better exposure to the employees
but also helps the organization to benefit from the new techniques
learnt by their employees. The condition for this benefit to be availed is
that Tapal has to be flexible in accepting the changes brought to the
organization.

Tapal should also lay emphasis on the evaluation interviews. These are
performance review sessions that gives employee feedback about their
past performance or future potential. This will benefit the employees
as well as the organization to have good, open communication with
each other. It is going to make replacements easier for the
organization and the employees would become aware of the specific
areas for improvement.

SALARY AND COMPENSATION

A sound compensation plan for employees considers the needs of both
the company and its work force. From the company’s standpoint, the
basic consideration is to get employees to do what management wants
done efficiently as possible because compensation is a major expense.
From the employee point of view, the basic concern is to maximize
earnings. Each employee wants a level of compensation that is felt to
be fair in comparison to the incomes of a peer group, other company
employees and the relevant labor market. The employee also wants a
balance of security (a steady income) and payment for extra effort
(incentive income). An effective compensation plan represents both
points.
At Tapal the compensation plan serves all the basic point mentioned
above. They see the industry aspects considering competition before
implementing their employee compensation plan. The following steps
are followed in developing their compensation plan:

• Reviewing the employees job

Reviewing the job description, education and experience reveals what
must company pay to acquire and satisfy the employee it wants.

• Establish objectives
As sales compensation objectives must be related to the company’s
sales and marketing goals. Compensation objectives must also be
realistic. Tapal has made their compensation plan, which is very much
related to their overall marketing and sales objectives.

• Level of Compensation
Tapal thoroughly examine pays which are attracting to their
employees, consider competitors pays plan, careful attention to the
relationship between employee compensation and profit and finally
their own history of employees compensation.

1. Financial Incentives

Financial incentives are direct monetary payments and indirect

rewards with monetary values. Tapal provides their employees
(producers, sales force etc) with direct incentives such as commissions
and bonuses.

Bonuses
Tapal adds bonuses to commission on sales and production volume.
Bonuses, which are usually rewards for special effort and provide,
direct motivation. Bonuses are additional incentives and awarded on
the basis of points compiled by the employees for such things as
setting up displays, cutting down expense of selling, producing and
exceeding quotas. Bonuses are also paid for extra effort related to the
company’s production, sales goals, on performance of certain types of
promotional work.
Bonuses are also used to encourage employees to assist in the
forecasting of the production process.

Commission
The commission is included as apart of great many compensation
plans. Tapal uses a simple commission plan, which is based on the
principle that earnings of employees should vary directly with
performance, i.e. employees are paid for results, and direct motivation
is the key advantage of such a compensation plan. The commission
provides a strong incentive to make more sales increase and increase
productivity. Strong performers are attracted and encouraged. High
earnings also provide employees on commission with recognition. In
commissioned selling, employees constantly set higher monetary
goals; they have a much higher need for recognition through pay than
for individuals within other fields
The company uses the following three commissions to motivate the
Employees

• Drawing Accounts
Tapal provides its work force working on commission a drawing
account, from which money is advanced against future
commissions. These accounts give employees some of the security
of a salary and allow management more control over sales,
production and various activities.

• Sliding Commission Plans

Tapal uses a changing commission rate. By using a progressive
commission plan the commission rate can be increased
proportionately with increase in sale. For e.g.

 Individual sales achievements

Based on your individual target achievement of products and on
overall sales achievement, you will be eligible for incentive
earnings.

• Varied Commission Plans

Tapal provides higher commission for producing, selling Tapal with
high growth profitability and lower commission for selling Tapal with
lower profitability.

 Groups working together

The company appoints groups and assigns them an everyday
target that is how many units to produce each day and how
many requirements of the consumer to cover. This working in-
 groups does not only help satisfy social needs of their employees
but also tries to develop new ideas to deal with people and
increase the sales.

2. Non Financial Incentives

Non-Financial Incentives provided by Tapal consist of variety of

incentives techniques used for specific effort situation i.e. to motivate
their employees in different situations The Non Financial Incentives
provided by both the firms are:

Recognition
Recognition it is very important as a motivational factor. This incentive
includes:
a) Acknowledgement of an accomplishment at the meetings or any
time.
b) Certificates
c) Top management involved in the recognition programs.

Employees Contest
Tapal also holds employee’s contests that are established incentives
techniques used in specific effort and situations. Employee contest
helps to achieve the company goals by satisfying some of the
employee’s personnel goals.

Fringe Benefits
Tapal provides fringe benefits, which are indirect monetary rewards
such as plans of insurance, vacations and pension.

Paid Leaves
These leaves include sick leaves, maternity leave, and severance pay.
The company requires that an employee work for a certain period of
time before being eligible for certain paid leaves.

Educational Help
With the increased desire for advanced education, Tapal introduced
educational assistance programs. Employees are taking advantage of
the company-sponsored educational programs.

UPGRADE

Temporary employees at Tapal do not have the security and stability

that permanent employees have. They should be provided with little
health care, pensions or other similar benefits. Tapal should also set a
production; distribution and sales target and any employee belonging
to the particular area reaching a desired target in the first quarter
should be selected as a permanent employee
At Tapal teamwork is given immense importance as the management
realizes the fact that the only way to attain and conform a high
standard is by working like a well -knit unit. Thus it is imperative that
Tapal should have an effective performance appraisal system, which
fosters teamwork.

Tapal has devised a very comprehensive performance appraisal

program in which each employee is given objectives against which
his/her performance will be evaluated. For the setting up of these
objectives with its work force, the company utilized Management by
Objectives. The way these objectives are set is through mutual
agreement, where the employees are told exactly what is required of
them, how they will be evaluated against each of their objectives and
what will be the reward in case if the objectives are met or exceeded.
The mutual setting up of these objectives in a participative manner
motivates the employee to achieve these objectives as they have a
hand in setting them up as well. Tapal should have a time limit,
evaluation criteria and clearly defined rewards that will contribute
towards motivating the employees to contribute the best towards
fulfilling their goals.
 TERRITORY MANAGEMENT

Although Tapal’s territory is spread all over Pakistan, this report is

basically concentrating on the territory of Karachi. The reason being
that the main operations of Tapal is usually carried out from the city of
Karachi only. Since territory management mainly involves the
planning, implementation and control of a salesperson’s activity,
similarly Tapal too is involved in this process of monitoring the
activities of their salespersons in their respective territories. The
primary aspect that the salesperson of Tapal should take into
consideration is that it is only he himself who is responsible for all the
activities in his respective territory and not the sales manager or the
company.

The reason for Tapal being a strong competitor in the tea market is
that their salespersons have come to realize that time is the key factor
in achieving success. Therefore, to utilize time in the most productive
manner may lead to success, as one is able to gather from the
example of Tapal. Another reason for Tapal being a tough competitor is
that they have adopted the policy of actively communicating with their
target market or rather their customers. They have successfully learnt
to think analytically, make sensible and appropriate decisions and have
effective human relations skills.

Like any other company, Tapal too wants to increase its sales and
profits, therefore to achieve this they have to be organized in making
their sales. In order to do this they have divided their national market
into various zones. The zone, which is discussed in this report, is that
of Karachi. This basically makes it easier for the company to operate
and manage their operations more efficiently. This particular factor
also simplifies the job of the salesperson, as he only has to concentrate
on his specific territory and not on the national marketplace as a
whole.

Tapal has also realized that by assigning respective territories to the

respective salespersons lead to increased job satisfaction as well as
increased morale. The reason for his phenomenon is that once the
salesperson realizes that only he is responsible for all the operations of
his territory, he is more motivated and dedicated to his work. Because
now he is the one who is making the key decisions regarding his
territory and only he will be held accountable for his actions and
decisions.

Territory management also has problems that have to be dealt with by

the company. Similarly, Tapal too is faced with some problems
regarding this aspect. The major problem concerning Tapal is that of
inadequate coverage. This usually occurs when a salesperson is given
too many accounts in a particular region; he would then be unable to
handle them efficiently and effectively. For example, a salesperson
may be given accounts to be handled in Karachi as well as Hyderabad,
now the problem may arise when the salesperson may be unable to
handle the accounts in Hyderabad since Karachi itself is a large
market. Or that he may be covering the Hyderabad market, but not as
efficiently as he would, if he would be dealing with that market solely.

Even if the territory is divided, which may be the case in the Karachi
and Hyderabad example, the former territory manager may influence
the new manager to service selective accounts.

Tapal by launching a successful advertising campaign has been able to

increase the sales potential of some of their territories. Taking into
consideration, the territory of Karachi, it is basically considered as a
high potential market, therefore results in low selling costs.

Tapal has to face tough competition in the market with major

competitors like Lipton and Supreme. Therefore when establishing its
territory, it has to take into consideration the facts concerning the
selling and the organizing abilities of their salespersons. The reason
being that, if the salesperson assigned to a particular territory is
inefficient and does not have the required abilities to operate a
territory then Tapal would then basically be wasting its resources like
finance and most importantly of all, time.

The major concern for Tapal is that of its competitors, when designing
its territory, it has to analyze first where its competitors are situated in
the market, so that it is able to place itself strategically and more
effectively than its competitors.

The desired intensity to cover a market is also a major facet that

influences a territory size and its configuration. Tapal when faced with
such fierce competition has to take into account the desired intensity
of market coverage. In order to provide some competition, Tapal
concentrates on covering as much of its sales potential territory as
possible.

The channels of distribution and the type of transport used are also
very important for any company to operate in a territory successfully
and effectively. Therefore similar is the case for Tapal when
configuring its territory.

Effective communication with the inside organization is also very

important for the company, therefore, Tapal realizing this fact has
close contacts with their salespersons all around the country. This
allows Tapal to eradicate any sort of insecurities and to fill any kind of
communication gap that may arise concerning the salespersons in
their respective territories.

UPGRADE

The main concern for any company is to increase their sales and
profits, and so therefore they try their level best to devise the most
effective strategies in order to increase their territories, which would
ultimately lead to an increase in its market share.

Tapal too takes the same factors into consideration and holds the
same aspects as important and has also devised and implemented
strategies that would or have led to an increase in their territories as
well their market share. But as it is said that there is always room for
improvement, therefore some new aspects should be taken into
account by Tapal in order to increase their territories and ultimately its
market share.

For Tapal its main customers are retailers, basically these are the
people that have to be focused when identifying the target market.
Therefore, Tapal has to find new and unique ways to lure these
customers. Tapal should give out special incentives for the retailers in
order to allow them to display their product on the front shelf. This
incentive may not only benefit the retailers but may also help attract
tea consumers to buy Tapal tea.

At present Tapal may consider Karachi as one territory and so

therefore may tackle its problems as a whole. It should realize the fact
that Karachi being a large city can be divided into smaller parts and
each part can be treated as a separate territory. This will not only
make it easier for Tapal to manage their territories more effectively,
but may also lessen the workload from the territory managers.
Tapal should specially be more inclined towards the needs of its
salespersons, the reason being that they have a tendency to be easily
demotivated and demoralized. Therefore, in order to secure their
territories Tapal should try to fulfill the general needs of its
salespersons by providing them with incentives and bonuses if they
exceed their sales target and so on and so forth.

The packaging of Tapal tea may also influence the territory aspect; the
reason being may be that its major competitors are yet to take out a
sachet for their tea. Therefore, if Tapal is the first one to introduce this
it may gain an upper edge over its competitors, territory wise as well
as market wise.

Tapal’s major competitors like Lipton and Supreme have a tendency to

sponsor social events, concerts and galas at a large scale. Tapal too
should expand its budget regarding this aspect and also sponsor such
events on a large scale.

Tapal can also provide hot tea outside supermarkets like Agha’s or at
parks like Nisar Shaheed etc, by putting up stalls. This may lure
customers to have Tapal tea, especially if they are situated at these
particular areas as they may be tired or may feel fatigued by the day’s
work.

Tapal may also start door-to-door selling of their product. This can be
carried out by providing the customers with tea bags or sachets of
their tea to refresh themselves and to allow the customers to provide
them with feedback on how to further improve their tea. This may not
only provide feedback on the spot, but may also allow Tapal to
increase its respective territory as compared to that of its competitors.

Tapal should also be aware of the aspect of distributing equal potential

territories to their salespersons. The reason may be if this not the case
then the salespersons with low potential territories may feel
demoralized and would therefore would not perform up to the required
standard.