INTRODUCTION
The federal government has work process for importing, processing, storage, quality control, pricing, supply management and regulation of petroleum products approved by the Government of Nepal (Council of Ministers) on January 18, 2073. Under Schedule-1 of Supply Policy 2069, kerosene, gas, diesel, petrol and jet fuel have also been placed under other essential substances. Nepal Oil Nigam Limited, established in the year 2027 under the federal government, is fully owned by the Government of Nepal to carry out the import, transportation, storage and distribution of petroleum products in accordance with the strategy to strengthen the supply system by facilitating the import of essential goods and services as per Schedule-1.
The purpose of this corporation is to contribute to country’s economy and development in accordance with the responsibility of facilitating the supply of petroleum products throughout the country, importing, storing, transporting, pricing, selling and distributing petroleum products through pipelines in different parts of the country, keeping stock, controlling leakages and ensuring smooth supply. Although the corporation has obtained a monopoly on the import and sale of petroleum products, as there is no production and processing of petroleum products within the country, the supply of petroleum products has to be completely dependent on imports. Due to the high demand and dependence on production of petroleum products, there is a big challenge for the corporation to facilitate the supply system. The past experience shows that the demand is increasing at the rate of about 10 percent annually, the fluctuations in the price of petroleum products in the international market and having to rely on only one supplier (Indian Oil Corporation) sometimes cause serious problems in supply. With the increasing demand for petroleum products, the arrival of latest technology, and increasing urbanization, Nepal Oil Corporation needs a corresponding organizational structure and management system to facilitate the smooth supply of petroleum products within the country. In this context, there is an inevitable need for a new organizational structure for Nepal Oil Corporation to review the current organizational structure of the corporation and establish it as an agile and effective organization.
Management Development and Research Associates Pvt. Ltd. And Nepal Oil Corporation has signed an agreement in order to make the organization structure and the corresponding job description in line with the federal structure, to ensure clear provisions for the moral development and morale of the employees, and to make the employees responsible for their work, to develop the corporation as a leading service provider business organization by reviewing the current organization structure of the corporation reasonably by revising and proposing a new organizational structure.
OBJECTIVES:
i. Analyzing the existing organization structure, recruitment schedules, scope and program, workload, available manpower of the corporation; and proposing a suitable organization structure to the Corporation.
ii. To review the recruitment on the basis of the nature of the work and their duties under technical and non-technical services.
iii. To Analyze the existing human resources forecasting the immediate and near future needs of the corporation.
iv. To propose organization structure including the central office of the corporation and its subordinate departments, regional office and various branches and projects.
v. To identify and propose the posts of temporary nature required by the corporation through service contract.
FINDINGS:
1. In order to meet the increasing urbanization and demand for petroleum products as well as to adopt the latest technology, the Nepal Oil Corporation needs a corresponding organizational structure and management system. In this context, there is an inevitable need for a new organizational structure for the Corporation.
2. The present storage capacity of the NOC is not sufficient to meet the increasing demand; loading and onloading process is manual, technical human resources are merely aware and trained to handle the autonomous system, and the Corporation does not have own transportation and distribution system except a petrol pump in Bhairahawa, Rupandehi District.
3. It has come to be known from interactions with the corporation that the corporation is planning to purchase its own transport vehicles and expand its petrol pumps limited to Bhairahawa to all seven provinces in order to discourage the trend of stopping the transportation and distribution of petroleum products in the form of protest.
4. It is seen that the import of petrol has increased by 340 percent in ten years, by 248 percent in diesel, by 172 percent in ATF and by 265 percent in LPG, while the kerosene import has decreased by 68 percent during the last ten-year period. If we consider the monetary analysis, it seems that the amount of petroleum products purchased by the corporation has increased by 384 percent during the ten years. But, the institutional capacity of the company has hardly been advanced to meet the increased risks.
5. Importing petroleum products from neighboring countries (currently only India) and distributing them easily and safely throughout the Kingdom of Nepal can be said to be the main function of this corporation. Apart from that, the Corporation has to do many things to minimize the risk of such hazardous substances by adopting modern measures in the import, transportation and distribution. Uninterruptable and quality distribution to the end user is being another challenge for the NOC.
6. The NOC is a monopoly company limited not a completely profit-oriented. It has to play a service-oriented role of the government of Nepal. Therefore, it is not able to independently implement auto pricing mechanism.
7. Out of a total of 872 staff approved by the corporation for its entire business operations only 612 positions have been recruited by the end of 2076/77. While analyzing the recruitment in terms of service, the total recruitment is based on permanent and service contract as well as technical and non-technical service categories. It seems that out of total 645 permanent requirement, including technical and non-technical service for all levels, 499 positions have been filled up and 146 positions remain vacant. Similarly, in the service contract category, 227 positions including technical and non-technical posts have been approved, only 113 positions have been recruited and a total of 114 positions are remained vacant.
8. In the same way, out of the 428 technical positions, the representation of the Officer, Assistant, Level less and Service Contract positions are 96, 104, 164 and 64 respectively.
9. In terms of posts/levels, Executive Director (1), Deputy Executive Directors (3), Directors (9), Deputy Director (27), Manager (53), Deputy Manager (60), Assistant Manager (103), Senior Assistant (151), Assistant (74) and a total of 391 non-level permanent and contractual basis positions have been approved.
10. Taking into account the frequent interactions, discussions, and objective analysis of the data provided to the study group with the employees working at different levels of the corporation, the following problems are found in the existing organizational structure and staffing of the corporation:
a. There is a visible gap between the existing structure and the organizational structure that the corporation should adopt to achieve the scenario, objectives, strategy, goals and objectives of the corporation for the next 5 years, both practically and structurally.
b. The existing organizational structure could not cover the concept of changes that may come in the safe import, storage and distribution of petroleum products including the territorial structure of the country and the expansion of the structure of the corporation in the future.
c. Along with the use of available information and technology, the existing structure could not clarify the changes in the needs of technical and non-technical service groups and upper and lower (senior and junior) level employees when going to automatic mechanism (automation L1, L2 & L3) or not.
d. Necessary technical/non-technical quota should be created according to the work nature and workload of the corporation’s offices and depots and the existing structure is not capable of assigning the same position after analyzing the condition of the technical/non-technical chief according to the work nature of the depots.
e. There is no provision in the existing structure that all qualified employees can participate equally in career development except as mentioned in the current law and qualified employees can be promoted to a certain level.
f. After studying the workload, an organizational structure is necessary to ensure career development opportunities in accordance with the same educational qualifications in technical and non-technical service/group positions such as Engineer, Chartered Accountant, Lab Assistant.
g. According to the job description, it is clear that authority should be given to the department head, deputy executive director and executive director, but there is no practical consistency in the existing structure.
h. After studying the situation of implementation of the decisions made by the internal management of the corporation in the past and the easy/uneasy aspects that appeared in the implementation, in the coming days all the employees of all categories and levels will feel the responsibility and also not to violate the labor law, new job description is necessary.
RECOMMENDATIONS:
1. In order to ensure the service of Nepal Oil Corporation up to seven different provinces, the organizational structure of the corporation has been presented by having one regional office in each province. The vacancy details of all the proposed regional offices are presented in the report. In the proposed posts, the number of posts has been separated into officer level, assistant level and service contract/level.
2. Eleven air transport service depots of Nepal Oil Corporation have been proposed by Bhadrapur, Biratnagar, Janakpur, Sinamangal, Manthali, Pokhara, Bhairahawa, Dang, Nepalganj, Surkhet and Dhangadhi, whose service group and level wise job posting details are presented in the report.
3. It has been proposed to have fuel depots of Nepal Oil Corporation at four locations including Mahendranagar, Nepalganj, Dang and Bhairahawa in Dhanusha to facilitate easy management, storage and distribution of petroleum products in all areas from the eastern part of Nepal to the central part to the western part. The job description of each fuel depot is presented by level and service group.
4. The branch level offices of the corporation and the details of the posts are proposed at Char-Ali in Jhapa, Birganj in Parsa, and Dipayal in Doti.
5. The difference between the existing approved tariff and the proposed tariff is presented in terms of level and service, group and sub-group. Under Non-Technical Service, Level-4 Assistant Posts of Administration and Accounts Group and Senior Assistant Level-5 Technical Miscellaneous Group Telephone Operator will not be filled by new recruitment, so if they become vacant for any reason, these posts will be canceled automatically.
6. The implementation plan of the proposed report will be mentioned on the basis of suggestions and feedback received on the draft report proposed by Nepal Oil Corporation.
7. The implementation plan of the proposed report will be mentioned on the basis of suggestions and feedback received on the draft report proposed by Nepal Oil Corporation.
8. Also, a proposed organization structure of NOC was prepared and mentioned in the report.
