Assignment HRM

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TRAINING AND DEVELOPMENT ON
ORGANIZATIONAL DEVELOPMENT IN
PETRONAS
TRAINING AND DEVELOPMENT IN PETRONAS: REPORT
FACULTY & PROGRAMME:
SEMESTER
:
PROJECT TITLE
:
GROUP MEMBERS
: 1. DAYANG FEBRUANA BINTI SUHAILI (2016365385)
2.
LECTURER
:
DATE OF SUBMISSION
:
EXECUTIVE SUMMARY
The market for crude oil merchandise is extremely competitive, with major transnational
companies particularly in an exceedingly mix-market country. PETRONAS markets its
merchandise on to customers furthermore as through its network of service stations, LPG
dealers and industrial dealers. What sets them apart area unit the range of merchandise,
services, promotional strategy, product branding and image, company identity and marketing
strategies. The Human Resource Management that been analyzed in this study are dealing
with Training and Development practice, its Advantages, Disadvantages, the implication and
recommendation on a specific reason.
In a market, there would be two completely different market categories: shopper
markets and business markets. As for oil and public utility, PETRONAS falls into each
market classes which are shopper markets and business markets. Meanwhile, PETRONAS
conjointly thought of as business market that they commercialism their oil and gas to
business firms for merchandising or manufacturing another merchandise. PETRONAS major
product sale are fuels and lubricants for Malaysia’s market. Meanwhile, stuff merchandise
created by PETRONAS into 5 classes that area unit car petrol, motorbike oil, duty engine oil,
industrial & marine oil and, transmission and gear oil. Under these segments, PETRONAS
offered kinds of merchandise that secret is to focus on completely different cluster of market
segmenting for PETRONAS merchandise, PETRONAS can go to devise a promotional effort
to promote their merchandise. PETRONAS, like all different company, has its own
promotion combination.
TABLE OF CONTENT
PAGE
TITLE PAGE
i
EXECUTIVE SUMMARY
ii
TABLE OF CONTENT
iii
1. INTRODUCTION
1
1.1
Background of Organization
1.2
Human Resource Practices of PETRONAS
1
1.3
Authorized to Work Training
3
2. ISSUES/PROBLEM
2.1
Introduction to Training and development
2.2
Training And Development Process
3. IMPLICATIONS
3
4
6
3.1
Advantages
3.2
Disadvantages
7
3.3
Discussion
8
4. SUGGESTION/RECOMMENDATION
5. CONCLUSION
8
9
6. JUSTIFICATION/PREDICTED OUTCOME OR
RECOMMENDATIONS
9
7. REFERENCES
10
1
1. INTRODUCTION
1.1
Background of Company
The petroleum industry is one of the richest industries in the world. In Malaysia, the
petroleum industry is under the stewardship of Petroliam Nasional Berhad (PETRONAS).
This company which was initiated by government holds the supreme rights of the
hydrocarbon resources, which is found in Malaysia. This company is involved in a various
program, which includes upstream exploration and production of oil and gas to downstream
oil refining; marketing and distribution of petroleum products; trading and so much more
(Petroliam Nasional Berhad, 2015).
According to the official website of PETRONAS organization, there were only 15
staff and just two phone lines in the year of 1974. Then, they started their performance from
the office of the Prime Minister’s Department in Jalan Dato’ Onn, Kuala Lumpur back in
1974. Later, PETRONAS launched their first Production Sharing Contract (PSC) in 1976 and
modified the concession system governing oil exploration and exploitation to the more
equitable PSC system. Thus it’s indicating the responsibility of PETRONAS Carigali Sdn
Bhd. Beyond their role as an operator; they embarked on exploration and merchandise
activities with the incorporation of PETRONAS Carigali Sdn Bhd in 1978. Finally in 1981,
PETRONAS had their own merchandise in Taman Tun Dr Ismail, Kuala Lumpur which is
happen to be their first gas station ever. During 1984, HQ had moved to Kompleks Dayabumi.
In 1985, the organization had started the first exportation of fertilizer and liquefied. Later in
1990, PETRONAS had the first overseas operation in Myanmar.
PETRONAS organization has been growing to a massive international gas and oil
company. Its merchandise was attentive in thirty five different countries. The group enclosed
103 owned subsidiaries, 57 joint companies, and 19 outfits at the end of March 2005. Finally,
at 31 August 1998. The 42 years of Independence Day of Malaysia, they chose to moved
into headquarter place in Kuala Lumpur, Malaysia.
1.2 Human Resource Practices of PETRONAS
Human resources can be defined as a pool of human capital under the firm’s control in a
direct employment relationship (Wright, McMahan and McWilliams, 1994). They can be
viewed as an asset to an organization as identified by (Barney, 1991) that there are three
resources in an organization; physical capital resources (e.g. geographic location), human
2
capital resources (quality of the managers e.g. experience and intelligence) and organizational
capital resources (e.g. planning and coordination system). The director of the gallery
currently possesses a strong physical capital resource which is his gallery and a strong human
capital resource to produce art which lies in his expertise and experience as an artist.
However, in terms of marketing, he currently lacks the expertise and time to handle such
tasks. (Schneider, 1987) further laid out that an organization consists of the people in it;
‘Organizations are the people in them; that people make the place.’ Though not mentioning
human resource directly, it specifies the core of an organization is the working people in it.
In PETRONAS Company, employees can be divided into two groups which are the
group in working in onshore and offshore. Onshore division only deals with technical and
non technical while offshore staff deals with all the technical parts. Over the past few years,
the employees in PETRONAS are always experiencing the development, advancement, or
even an excellent training practice. This is because; the company are always looking forward
to generate more competent and excellent employees by providing training and development
which is based on skill group on specific field.
Beside that, to take care of the employees, they are provide with the right skills,
knowledge and abilities to complete their job, training and development plays its important
role towards the growth and success of PETRONAS. In this case, PETRONAS insiders are
confidential not only for the case of training and development activities but also giving
advantage from the daily casual counselling and instructing
In a way to enhance the employees’ knowledge and ability, there is an intended
excellence official activities in training and development practice which is called as
developing in-house trainers. In this context, PETRONAS organization subordinates’ training
essential are time after time recognize by the superiors. In order to offer effective and
important training, PETRONAS has modernized in excess of 30 in-house trainers. In-house
training is defined as any training that is held in organization in order to educate, develop or
expand employees’ technique and skills. This involves all technical and soft skills courses
that serve for this purpose. These instructors are well capable of to afford training and
development programs in the specific field.
3
1.3 Authorized to Work Training
It is essential to recognized PETRONAS structure by stating exactly what is the specific
mission or work that has to be completed within certain period of time. Getting to work and
test out safety at each of the stage in working environment is a responsible for an employee to
carry out. Employees pledge the job sign the permit are to show that they realize the risks
involved and what safety measures are necessary.
Nevertheless, PETRONAS’s employers must be alert and get to know the policy
about the risk of job practice, and make sure that they understand their responsibility, duties
and obligations in law. Therefore, the course of industrial safety training will enable
managers to appraise the rules of a particular job or task, and make sure that authorized work
documentation is done properly and that employees undertaking dangerous activities are
capable to do in safety possible way.
2. ISSUE/PROBLEMS
2.1 The conception of Training and development
Employees are very essential to every organisation. The process of handling and managing
the employees is the critical procedure in order to improve their expectation towards the
organization. To ensure the process run smoothly, training and development is one of the
main tools in human resource management. As we are living in the globalization world, most
of the company will take the risk of investing money by providing training and development
to their employees in the hope that to make a big profit and compete in business field. In fact,
by investing money in employees will make a change instead of investing money in
equipment because its value might be depreciated over the years. Thus, it will bring a lot of
benefits to company. In return, the company could produce more competent, productive and
progressive employees to the company. Hence, the company performance could be improved
over the years.
According to Snell and Bohlander (2007), they stated that training tends to be
narrowly focused and oriented toward short term performance. It is the process of teaching
employees the skills they need to perform their jobs efficiently. It provides new or present
employees the skills they need to perform their jobs. Generally, training is the process of
acquiring knowledge, developing competencies and skills, and adopting behaviours that
improve performance in current jobs. It is also an organizational activity which aims to
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improve an employee’s current performance. Furthermore, it is an effort initiated by an
organization to promote or cultivate learning among its members. Mondy and Noe (2007)
stated taht training is the heart of a continuous effort designed to improve employee
competency and organizational performance.
On the other hand, the term of development is the process of upgrading the skills and
knowledge to meet not only current but also future requirements of the jobs. Development is
an effort that tends to be oriented more toward broadening an individual’s skills for the future
responsibilities (Snell and Bohlander, 2010). Mondy and Noe (2009) however defined
development as a continuous learning that stepping beyond today’s job and more focus
towards career development.
2.2 Training And Development Process
According to Snell and Bohlander (2007) asserts that a more sophisticated training and
development process as illustrated by Figure 1 which only has 4 steps.
Figure 1: Training and Development Process
Source: Snell and Bohlander ( 2007) .
The first phase in training and development process can be divided into theree parts
such the analysis of the organization (where training is needed, how it connects with
company's strategic goals and how to use resources for training), task (to identify the KSA
employers need) and person analysis (to identify which people need training). Organization
analysis is done through examination of the environment, strategies and resources of the
5
organization to determine where training emphasis should be placed & attain management’s
support for training activities. Meanwhile task analysis is the process of determining the
content of training program based on tasks and duties involved in the job. And for the person
analysis is to determine of specific individuals who need training (Snell and Bohlander ,
2007).
For the second phase, in drafting the training need to highlight the four related issues
such as Instructional Objectives (T&D Objectives), Trainee Readiness & Motivation,
Learning Principles and Characteristics Of Instructors. Moving forward is the third phase
which is the implementation of training program that has been designed. At this stage,
training instructors must make sure that transfer of learning takes place among the
participants. On the other hand at implementation stage, the training provider must determine
the following aspects such as Programs (tentative program or training schedule), Date, Time,
Place, Duration, and two Methods which is Method 1:On the job training and method 2: Off
the job training (Snell and Bohlander, 2007).
The last step is to examine the T&D. By examining the participants’ point of view, it
may give a fast illustration of trouble spots and also provide an idea of participants’ attitudes
regarding the value of the training. Besides that, give a test pertaining their knowledge and
skills before beginning a training program gives a fundamental standard on trainees that can
be taken again after learning to determine improvement. The third criteria is behavioral
changes on the job. In this context, behavior is to get to know the transfer of learning through
change in job performances. This behavior change is reflected through the change in
performance and way of conduct at workplace or organization. At last the result of training
and development indicates increament of productivity, lower turnover, higher quality and
better profits. Training result is evaluated by measuring the effect of training on the
achievement of organizational objectives.
Therefore, in this case study, we attempts to examine and gain a core value of the
relationship between training and development practice to the organization development in
PETRONAS particularly in terms of employee performance. The T&D variables such
training method, process including four phases of T&D, advantages, disadvantages and the
recommendation towards modification in HRM related problem will be discussed in the
corresponding subtopics.
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3. IMPLICATIONS
3.1 Advantages
Training is not just important in a company but it is vital. Therefore, there are several
advantages of training and development to the PETRONAS organization. The first
advantages are the in-house training could save the cost. By providing in-house training, the
cost of representative will be decrease and the scenario would be different if we sending
employees to public training courses. Secondly by providing their own training practice,
PETRONAS organization will get a lot of benefits because it is easy to draft the training
schedule besides it fits around the working schedule of the employees and the location of the
training. Furthermore, it’s saving trainee’s travel cost because there are some of the
PETRONAS’s trainee need to travel further than their offices and suffer extra costs like
transport fees, driver and so on. Next one is can enhance the social relations among the
workers, all the trainee will be in a same room which is full of delegates from various
departments which they will be able to encourage greater team work, progressive and
understanding of each other’s role.
On the technical training also can give some advantages such as the training may
causes employee’s career advancement and development. As stated by Peteraf (1993), a
comprehensive training and development program helps in deliberating on the knowledge,
skills and attitudes necessary to achieve organizational goals and also to create competitive
advantage. Moreover, when the employers get to know that the employees are eager in
learning, the employers will give them opportunity to be in the technical areas, which is
handling the technical responsibility, project leadership, management and planning. Finally, it
will increase the salary of employees. .
Nevertheless, education grants many benefits to the PETRONAS’s workers. Despite
of that, the existence of merit and demerit practice can give anxious to the workers. In this
case, education grants provide help to pay their tuition fees, sponsor and assistance from their
organization so that they can pursue their study without being afraid about the financial
statements. On top of that, there is also none competitive, everyone who have the attentive
and ability or found to be a worthy candidate may deserve the grants from either an industry,
government or others sponsor. Therefore, this education grants perhaps help PETRONAS’s
employees update their skill and training be a competent and excellence workers.
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3.2 Disadvantages
In this section, we are going to point out several disadvantages in training and development.
From the previous section mentioned the in-house training advantages. On the other hand, the
disadvantages of in-house training is include extra administration burden that PETRONAS
need to make sure there have suitable training room, equipment, trainer parking to get the
delegates to the training centre. At the same time, some of the trainee may not take it as
seriously as they might attend just to have a break from their job or don’t turn up when the
course is conducting on another day. Therefore, it end up with no networking opportunities
during this training as employees are not allow to have networking and learning from another
company. As a result, this will place some pressure to PETRONAS’s employees, if they are
offsite training then they cannot be contacted to class however if they are onsite they can be
stop being involved in a classroom if needed.
Meanwhile, there are also some disadvantages in technical training particularly in cost.
When the company sends the employees for training, the company has to pay off employees
to invite the trainer. Therefore, it will increase the expenses of the company. Moreover, a
good trainer may be expensive and causes over budget. Besides, the disadvantage of technical
coaching is time necessities. The company should pay a many time for coaching workers
however the corporate don’t have abundant time. If the corporate offers the time that doesn’t
enough for coaching, it may causes employees do not know everything that they have to learn.
The trainer will also have to be compelled to rush the time is not enough and causes the
trainer goes through some topic that’s vital and ignore some topic that employees have to
learn too.
Nevertheless, education grant has disadvantages as well. Grants have a slender down
by proscribing the quantity of workers to use with the size of job fitting. Employees who
obtaining the education grants usually need to work more durable and lots of examine and
strategic to fulfil individual’s demand. Moreover, it’s conjointly increase an organization’s
expenditure since specific activities should be enclosed in a number of the project. In addition,
revolution of technology nowadays up growth. Legislator and different charge of education
or coaching would like a lot of funds to re-establish the changes.
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3.3 Discussion
PETRONAS as an organization, directional their organization program and strategic, setting
their practices of coaching and development for the long run. PETRONAS has created use of
technical coaching, in-house coaching and education grants as their practices for the
employees’ coaching and development. Comparing with the similar industry as thought
SHELL Global or ESSO, they need applied some skilled training like publicity and media
programme for his or her employees in keeping with their working experience. It’s higher
attending a module with representative from alternative corporations. This will permit
networking interaction a lot of and learning from each other.
Besides, training and development bring plenty of benefits to PETRONAS Company.
PETRONAS had used training and development appropriately. For example, PETRONAS
used technical training cause’s employee’s career advancement and causes employees lead to
personal growth. In this case, PETRONAS will be more progress through training and
development. Thus, training and development might causes the corporate become a lot of
effectiveness though it’ll bring some disadvantages to the corporate.
4. SUGGESTIONS/RECCOMENDATION
PETRONAS organization might be well known and established as an oil and gas company
over the world. In fact, the organization has been running for 3 decades. However, it is still
experiencing fluctuated trends in business. Sometimes rise and fall irregularly in numbers of
selling amount. But, this problem can be can be sped up by several strategies.
PETRONAS got to notice various practices of training and development for his or her
employees. To deciding a protracted term profitableness and well management of an
organization, the quality of employees are the major issues in a company throughout some
training and education. It is a decent guiding principle to devote a wonderful worker, which
can improve the company’s productivity consequently. A suggestion that is PETRONAS may
propose a property organization and leadership techniques with the institutes that embody
Universiti Teknologi PETRONAS (UTP), Institut Teknologi Petroleum PETRONAS
(INSTEP) and PETRONAS Management Training. It ought to conjointly invite some
profession institutor from different country to conduct company workers. Therefore, hope
that it could benefits PETRONAS to achieve some valuable employees and able to increase
company’s employee effectiveness and efficiency.
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In addition, PETRONAS must bring up to date the program in technical training. For
example, they may combine some course which is stimulates to employees. For instance, they
may able to introduce some new advanced computer software, technological systems,
programs or algorithms to enhance the current skill of employees. In this case, employees
may get more new knowledge and develop their skills so that it can use in their current jobs.
Thus, PETRONAS can ensure that the employees are working in a safety environment by
training well their employees. Moreover, the organization also can start to teach new skills to
new employees on new systems. It is because they may avoid change conflict from
employees. For example, Shell Global make sure that their engineers area unit trained well
and able to add safety surroundings by giving them training in drilling, operating, maintain,
and planning.
5. CONCLUSION
In conclusion, PETRONAS is a company that categorized under the oligopoly type of market
structures. This company is one of the government’s assets and also one of the companies
that provides petroleum and gas for the country. PETRONAS has been growing nationwide
and worldwide since previous years. The products also being exported and used in other
countries such as Egypt and Africa. By exportation the merchandise, it is making a lot of
profits and as such the country benefits a lot from it. Production of fossil fuel and gas don’t
seem to be the sole issue that it take care of however additionally collaborate with alternative
markets like education and supply support loans to those students which need them. Various
establishments had been established by PETRONAS as their main objective is to
counterpoint the state with quality education.
6. JUSTIFICATION/PREDICTED OUTCOME OR RECOMMENDATION
According to researchers, employee productivity is how the organization measures the
capability of employee by using their overall merchandise as compare to the organizational
performance. Productivity is the level of outcome where employees can contribute their best
effort to achieve the organizational goals (Kandi, 2012). Besides, productivity can be seen as
how an organization can use the available resources to maximize their performance, optimize
energy and improve overall efficiency (Olaniyan & Ojo, 2008).
In other words, it is meant by how well an organization converts their input resources
such as labours, materials, equipment and many more into goods and services (Leblebici,
10
2012). Employee productivity can be indirectly improved when an organization provides
training and development to their employees. By doing so, the organization can increase the
employee’s work performance but also offer chance for them to have a better understanding
on their jobs. Therefore, they can perform well in terms of their productivity in work with
knowledge, ability and skills to guide them to achieve a better performance. Furthermore,
employee productivity can be improved based on the employee’s competitive level.
Moreover, the measure of work productivity can be affected by the satisfaction of employee
towards the organization. For examples, their satisfaction level increase when the
expectations regarding on the training and development provided by the organization was
achieved. Therefore, employee productivity can be positively impact to the organization
(Hallgren & Olhager, 2009).
Lending from Tahir et al., (2014), an organization can reach its goals and objectives
with motivation, innovation of employees which can cause employees to be more productive
as they will commit and contribute more towards the organization. A good relationship
between the organizations and employee productivity can determine the well being of the
organization. Furthermore, an appropriate training provided for employees can give positive
impacts on employee productivity towards organization. Employees can overcome any
problem related to the organization easily with better organizational learning therefore
employee should make use of the training and development provided by the organization.
Hence, mutual understanding between the working environments among employees including
with the top management are shared among each other
In 21st century, the Human Resource Managers have propound one of the main
challenges they are to tackle had involved issues related to training and development (Stavrou,
Brewster and Charalambous 2004).
According to Niazi (2011), training and development is referring to the process of
deliver or acquire knowledge, skills and abilities needed to bring out a particular activity. In
most of the time, training and development is the most useful tools to close the gap between
organization’s current performance and future expected performance. According to
researcher, training and development is the most important factor towards the growth and
success of a business because through training and development programme, employees and
organizational effectiveness and efficiency can be increased. Training and development
program able to increase an employee job performance by enhance their skills and
11
competencies. The need for an organization to organize a training and development program
is because it has an impact on organization’s return on investment, as organization
performance has a direct relationship with employee performance or productivity.
Therefore, training and development is beneficial for both employee and organization
in the long run (Khan, Khan & Khan, 2011). In order to have an effective training for the
employees, human resource has to choose the right type of training to make sure the
employee acquired the specific skills to run the business. A well-planned training and
development program is a complex task as human resource needs to determine the training
methods and delivery styles, fix a training period and selection of trainers.
Besides that, technical training generates personal progress among workers. This is
because they are learning something in a short period of time through technical training. This
is can be seen in Zin, et.al (2013) work which is they defines that the job rotation has a
positive relationship in career development. Koontz and Mills (1984) supports this statements
when they said that job rotation is the top type in training and it was create to ease the
employee with the specific information about the positions that might available for the
employee as site Oparanma, A and Nwaeke, (2015). In addition, technical training may help
new employees, in the positions of career- oriented, and refresh the skills and knowledge of
older employees so that they can keep up in their working environment and build up better
relationships between employers and employees.
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Beardwell, J. & Clark, I. (2007). An Introduction to Human Resource Management, In
Beardwell J. and Claydon, T., Human Resource Management: A Contemporary Approach. 1
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Bohlander, G. and Snell, S. (2007). Managing Human Resources. Thomson, Australia.
Burke, R. J. (2006). The human resources revolution 1. In Burke R.J and Cooper, C.L., The
Human Resource Revolution: Why Putting People First Matters, 4-11. Elsevier, UK.
HallgrenJan, M., & Olhager, O. (2009). Lean and agile manufacturing: External and internal
drivers and performance outcomes. International Journal of Operations & Production
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Kandi, K. K. (2012). Study of training and development of employees in Indonesia Synthetics
(India) LTD. Butibori Nagpur. DMIMS Datta Meghe Institute of Management and Studies
Atrey Layout.
Khan, R. A. G., Khan, F. A., Dr. & Khan, M., A. (2011). Impact of Training and
Development on Organizational Performance. Global Journal Of Management And Business
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Leblebici, D. (2012). Impact of workplace quality on employee's productivity : case study of
a bank in Turkey. Journal of Business, Economics & Finance, 1(1). Retrieved from
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Mondy, W., Noe, M. and Premeaux, R. (1999) Human Resource Management. 7th Edition,
Prentice-Hall International, London.
Mondy, R. W. & Noe, R. M. (2005). Human resource management. (9th Ed.). New Jersey:
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Niazi., A. S. (2011) Training and Development Strategy and Its Role in Organizational
Performance. Journal of Public Administration and Governance. 1(2).
Olaniyan, D. A., & Ojo, L. B. (2008). Staff Training and Development: A Vital Tool for
Organisational Effectiveness. European Journal of Scientific Research, 327-330.
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O’Malley, L. and Tynan, C. (2001) ‘Reframing relationship marketing for consumer markets’,
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Tahir, N., Yousafzai, I. K., Jan, S., & Hashim, M. (2014). The Impact of Training and
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Limited Peshawar City, KPK, Pakistan. International Journal of Academic Research in
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