1. TESCO
Casestudy
This case study is conducted only for institutional
information purpose not for specialist services.This
materialmay not be quoted or reproduced in any form
without prior consent of Quaid-E-Azam College of
Commerce,University of Peshawar.
HAMDANKHANKHADUKHEL
Roll #14, M.COM1st Semester
4/14/2014

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1-Executive Summary:
The electrical energy services industry in Pakistan headed by Ministry of water and
power aim to rising enlighten Pakistan is providing electrical power services to its
customers in whole country through its 15 companies. One of them is Tribal Areas
Electricity Supply Company (TESCO), which was founded in August 2004. It provides
electricity to homes, houses, factories, commercial shops and tube wells in Tribal Areas
of Pakistan.
Engr: Zakaullah Khan Gandapur is currently working as its CEO and answerable for his
work of four divisions and 11 sub divisions to WAPDA House Lahore. TESCO supply
electricity to 1200 km Area of Tribal Areas and 2, 89,729 consumers. It covers 7
agencies and 7 Frontier regions. It has more than 2 Arab of assets.
I have done my Case study on this organization where I found a major problem of Bills
payment which is a serious cause for TESCO. Some of the suggestion in this regard is :>
Law and order, incentives, FCR(frontier crimes regulation) removal, Security providing
from Terror, Nomination to KPK assembly, Royalties, Equal employment opportunities,
Awareness in people, Land disputes solution, GIS for decision making, New technology,
Good communication with Jirga, Economic benefits, Check and balance, proper team
work, Quality assurance and so on.
Lastly I would say that TESCO will become fruit full company in future if this problem is
solved and it continues its integrating Strategic and culture policy for peoples of tribal
areas of Pakistan.

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2-Key Words:
Strategic plan, Agencies, Integration, Law & order, Bills payment.
3-Organizational Background:
Organization History:
Tribal Areas Electric Supply Company (TESCO) came into being on 05-Aug-2004 as a
corporate body under PEPCO as one of the step taken towards vertical
disintegration of the power sector of Pakistan. So Government of Pakistan is its
Founder. Power, energy and electricity sector is in Pakistan is gradually moving
from monopoly to privatization and from integration to disintegration. To keep
enhance with this change,the Pakistani Government approved a strategic company
plan in 1994 as a consequence of which the power wing of Water and power
development Authority has been divided into 15 corporations for generation,
transmission and distribution of electric power inside Pakistan. Thus TESCO came
into being in electrical services industry to provide electrical services to Tribal Areas
of Pakistan.
Type and Nature of business:
TESCO was formed as a Semi-Government Autonomous Body (Corporation) in
public sector for the purpose of coordinating and giving a unified direction to the
development of schemes in different sectors i.e. Water and Power, which were
previously being deal by the respective Electricity and Irrigation Department of the
different Provinces. TESCO is one of the biggest Distribution entities of water and
power development authority (WADPA).Its area of operation is the seven different
Agencies and related Frontier regions (FR). It covers the entire tribal areas of
Pakistan and it is the only corporation, which is providing electricity facility to the
customers of this area.

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All the construction work of 11 kilowatt (KV) transmission line and 132 / 66 KVline
are being carried out by the operational staff of TESCO. More over its maintenance is
also carried out by separate GSOand SS&TLDivision/ Department. Transmission
lines of electricity are from Tarbela Dam and Warsak Dam. The area of jurisdiction of
TESCO is more than 1200 kilometers. It consists of seven agencies and FRs that are
situated along Afghanistan boundary. The seven agencies are :> ( Kurram Agency ,
Orakzai Agency,Khyber Agency, North Waziristan Agency, South Waziristan Agency,
Bajur Agency, Mohmand Agency).The frontier regions are :> ( FRPeshawar,FR
Kohat, FRBannu,FRLakki, FRDera Ismail Khan,FRTank).
Services That Organization offers: As the
leading electricity distribution corporate body, TESCO strive to provide un-
interrupted electric supply and quality full services to all customers/ consumers at
the minimum possible cost/ rate.Federally Administrated Tribal Areas (FATA) has 2,
89,729 number of electricity consumers spread over in area of 27,333 sq.Kilometers.
TESCO has four Operational Divisions with 11 Sub Divisions in that area, which are
engaged in operation and maintenance of electricity and power system. This area
was previously being served by FATACircle of Peshawar Electricity Supply
Company (PESCO). However, in order to improve operational efficiency and better
customer services, a separate company TESCO was established to carry-out
expeditious execution, development, operation, maintenance and augmentation of
electrical network with revenue collection in that area.
Financial Status: Currently
Tesco is earningrevenue of RS7crore/ monthly, while total expenditure for 2013
was above 50 crore and revenue was 84 crore.Most of its revenue is from factories.
Total assets worth of this company is 200 crore.Sources of income are factories,
Shops,Tube well of irrigation department and C&W(communication and works

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department) etc. Bank reconciliation occur monthly as Bank statement received
then Accounts section make it tally with their own books and send copy to Wapda
House as well. Basis of accounting is on Cash not accrual. It generates its own
revenue.It has its own vehicles include of Jeep,pick-up, Dotson, and Truck. They
prepare financial statements annually and do their audit internal Through WAPDA
House as well as on Nouman and Co Auditor Firm as external audit. They keep books
of accounts on manual basis not in computers. They also keep a budget set aside for
petty cash fund.Net profit transferred to Wapda House each year as final accounting
done.
4-Setting the Stage:
Organizational Structure:
TESCO is technocratic, functional and semi-Government organization consists of
different departments inside the organization. It has 2500 employees working on
permanent basis. As its CEO is appoint by Federal Minister of water &power
and his office is in Lahore. Departments inside the TESCO working are :>
1-Technical Department, 2-Commercial Department, 3-Finance
Department 4-Executive Department. It has different branch offices in Hangu,
Bannu,Tank and Hayatabad.Government of Pakistan is stockholder in TESCO.
Key individuals inside the organization &Role:
Eng:Pervez Khankhel Swati is chief executive Officer of TESCO leading the
organization. Who has 4 subordinates whose ranks are :> 1-Director Technical +
operational + CS. 2- Deputy Director Corporate 3- DGHR/ Admin 4- Secretary
> Director Technical + operational + CShas vast responsibilities.Which includes:
checking the work of Two Directors,Manager Operations, XEN construction & 1
Deputy Director. >
Secretary is full time legal and government officer responsible for day to day office
work, funds transfer, Liaison etc.

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> Deputy Director corporate is responsible for business activities i.e. services
rendered,profit and other activities.
> DGHR/ Admin is responsible for employment and Audit activities in which he is
assisted by two deputy directors.
Management Practices:
Main management power is with CEO. Lower level staffing done by SDO. Planning
process is done through CEO, S.E (superintending engineer),SDO,Line
superintendent. Information flow is technical type inside organization. Outside flow
of information done through Pakistan Post.PRO is also liable for different kind of
information. International affairs held through WAPDAHouse Lahore. Supervisory
staff is responsible for quality focus. Training centre’s is in Faisalabad and
Islamabad.
Organizational Culture:
Here in this organization “Do respect have respect” policy is implemented. Good and
friendly environment for employees. There is policy for casual,annual and
emergency leave for employees. Group life insurance policy is also available for all
employees which process is done through WAPDAhouse Lahore. Company also
provide loan facility to employees for motor cycle,land/ plot buying. WAPDAwelfare
fund is also for internal employees.
Key players outside the Organization:
Ministry of water and power, PEPCO, WAPDA,USAID, UKAID, NTDC,FBR,are main
key players outside the organization. Governor Khyber Pakhtunkhwa and Political
Agents of different agencies also have influence on this organization.

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5-Case Description:
Integrating Strategy & Culture in Tribal Areas Regarding Collection of Bills:
Every society has its own culture,norms, beliefs,customs, rituals, myth, ceremonies,
and sagas.Any organization providing goods and services to society must take into
consideration those factors while making strategies. Now here question is arising
that what is culture, strategy and its integration. So I am going to discuss it.
 Culture is arts and other manifestation of human intellectual achievement
regarded collectively. Or It is characteristics of a particular group of people
defined by everything from language,religion, social, habits, cuisine, arts and
music. It consists of two wings that can give to community a different
identity that are :> -performance distribution -Equilibrium behavior
distribution. Culture of different organization implicit in lives of all
members who belong to a community. Culture manifestation in
organization includes formal practice,informal practice and values.
 Strategy is plan of top level management in entity to achieve one or more
goals under ambiguous condition. Or the way you accomplish plan. Or How
to act upon your plan is strategy.Henry Mint bergdefines it as “A pattern in
stream of decision”. It can also be defines as A systematic approach of
probing,making and developing a doctrine that will ensure long time success
if followed faithfully”.It can be understandable as “The art and science of
planning and marshalling resources for their most efficient and effective uses
”.
 Integration means mixing up,making acceptable,making in affiliation with,
synchronization of two.

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From the above it is abstracted that integrating strategy and culture means to not
spoil the culture and implement your strategy regarding bills collection which is
looking favorable to customer/ consumer in Tribal areas.
Importance for Organization:
The chances of desirable outcomes increase due to integration of strategy and
culture in organization. So if strategy is not synchronizing with culture of that
specific geographical area/ location then strategic plan of an organization will
become fail/ flop. As we know that strategy is product of culture and culture is
product of strategy as well it relates to strategic management concept. So culture can
inhibit Strategic management of different organizations. As electricity theft is
substantial in magnitude. So here the concept of integrating the strategy and culture
will be implemented. For every organization providing goods and services they have
to follow the strategy which is socially acceptable for their customers as well as goal
achievable.As strategic plan apply across all the departments of business
organizations so plans and policies must be in according with culture,norms, belief
of that specific geographical location.
Respondent Views:
As I conduct interview ofresource person who is also respondent
personality inside this organization. His views about this main Challenge are:
 Tribal people have no proof/ evidence ofWarsak dam compensation so they are not
exempted from bills.Kunda culture exists there which is theft of electricity.
 60 % of factories pay bill.But also arrears to them.Supply of power is varying from
1 region to other region.
 2 to 3 hours electricity supply to domestic people.If someone cooperates then
duration of electric supply extend and also relief given to them.
 Policy ofcollection is that “We have Bills distributor also”.Some ofthem submit bills
by bank and some by cheaque.
 Ifamount ofbill not tally then they make noise,rude and unethical behavior.

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 Every1 inside organization is doing effort to increase revenue.As in 2001 the bills
collection was 75lac monthly and now it is 140 million/ month.
 Political interference is much more.Ifwe increase the duration ofpower supply then
they are not willing to pay bills.
 Some of shops give only 200Rs/ monthly which is not enough.
 “They are Greedy people”.“Hell man is a no man”.
Practicing:
In today’s evolutionary world where technology keeps on revolutionizing,the
eradication of poverty and to provide them reliable and affordable energy services is
motto of organizations. As low income household spend a substantial share of their
income on utility services such as electricity, heating.The difficulty is that consumer
has in affording further tariff. The affordability of energy at house hold level
embodies the relationship between broader energy, social and housing policies.As
we know Tribal areas are not in jurisdiction of provincial government but in Federal
administration so for maximum benefit in TESCO the above concept is practiced
upto some extent to bring that people in national development scenario. As TESCO is
giving relief to tribal peoples in this regard so we can say that this management
concept applied here in this organization.
General Views:
As energy is considered as life line of an economy and most vital instrument of socio
economic development of a country. We examine the effect of electricity market
reform on residential consumers,using hypothetical scenarios likely to be prompted
by reform.To control over the problem of guns,Opium, heroine and other addicted
sowings in tribal areas,Government of Pakistan takes step of supplying electricity to
them. So TESCO start their services.I
conduct interview of Senior Jirga Member (Name hidden) of Afridi Caste to know
about Tribal areas people views which are :>

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 At the time of building Warsak Dam there was meeting conducted between
Tribal Areas Jirga and Federal Govt of Pakistan in which Govt accept the
point to provide free electricity services upto 100 years to Tribal Areas.
 The 30% trade between Afghanistan and Pakistan done through the route of
Khyber agency and other tribal areas on which no subsidy is given to Tribal
people, therefore no bills paid.
 Federal govt does not do anything for them therefore they give the bills
amount in lump sum as compensation to TESCO on behalf of Tribal people.
 Feeder repair charges given by political agent of respective agency to TESCO
from annual fund/ budget.So they not pay bills/ charges.
 There is tradition that they will not pay bills due to their ancestor’s advice.
 TESCO employee’s communication is not good with general public.
Some time they also take bribe from public to provide them uninterrupted electric
supply for factories in Dara Adam Khel and so on.
6-Management Challenges Faced by TESCO:
As power theft is exhibits characteristic consistent with the political capture of public
service delivery by local elites and it is widespread in developing countries. It is
politically correlated. Challenges face by organization in solving problem is :>
 Lack of government attention.
 Firing from tribal people side.
 Illiteracy and uneducated culture of FATA.
 Kidnapping of officers.
 Beating of employees.
 Talibanization, terrorist activities.
 Noise and crying on employees.
 Threats given to employees.
 Appointments make on MNA recommendation.
 Corruption inside TESCO.

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 Jirga member’s opposition.
 Non cooperation of Tribal peoples.
 Dynamic and complex environment.
 Resistance to change.
 Reluctance to establish strategy.
 Short fall of electricity from grid stations.
 Oil dependency on foreign countries.
 Lack of latest technology.
7-Possible Solutions/Recommendations for Problem:
There are number of ways through which the social impact of tariff adjustment can be
mitigated, chief among them are targeted assistance program and life line tariffs. But it
requires competent institution and considerable administration capacity inside TESCO.
Different reforms in the power sector are in progress that will bring significant changes
including innovative technology, improved reliabilities and quality of electric supply. In
my opinion steps for solution are :>
 Groundrealitiesmust befollowed.
 Facilitiesin province mustbeprovided toFATA.
 FCR/FATARegulation mustberemoved.
 Equal employment opportunities mustbegiven to FATApeople
asgiven to otherprovinces.
 Incentivesfrom governmentmust beprovided to them.
 Bringlaw and order situationin FATA.
 Nominationin provincial assembly given to them.
 Royaltiesof Warsak damand Torkham tradegiven to them.
 Reformsin land sector and GISimplementation.
 Gasandother benefits to bringthem in national developmentscenario.
 Buildingawarenessand aligningwith strategy.
 Shiftingof industry and economicbenefitsmustbegiven to them.

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 Exemptionsand incentivesallowed to them.
 Givingincentives to them.
 Committee arrangement.
 Check andbalance.
 Providingfuel assistancepayment.
 Makingenergy efficiency improvement to low incomeresidence.
 Goodcommunication with Tribal people.
 Pursue thecustomers through Jirgasystem.
 Proper team for collection of bill matters.
 Internal rulesand regulation setting.
 Improvementin qualityof infrastructureservices.
 Enacting tariff mechanism thatcharge lesser amount for electricity usage.
8-Conclusion:
From the above data it is concluded that TESCO is taking a part in economic and social
development of Pakistan and continue to bring people of tribal areas from uneducated
culture towards new Pakistan and taking a part in making of a progressive Pakistan.
If sincere work is done for solution of this problem then it is sure that this problem will be
solved within a year. But it requires team work, Good strategic plan, Operational staff
competency, Full Security to employees, Table talk/Meeting with Tribal Jirga. Implement
rule by Governor KPK and so on.

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9-References:
 Taimur Kurm &William H Sanhelm,Culture integration and its Discontents.
 Joanne Martin (2004), Organizational Culture.
 Samuel Fankhase & Sladjana Tepic, Can poor consumer pay for energy &
water? An affordability analysis for transition country.
 Maria Golden & Brian Mint, Theft &loss of electricity.
 Raissahe (2012), Electronic bills payment in Canada.
 Majid Ali (2010), Reason of increase in electricity rates in Pakistan.
 Stefen Buzar (2007), The “Hidden” geographies of energy poverty in post
socialism: Between institution and households.
 CW Price, Kpalm (2009), Utility policy: The impact of electricity market
reform on consumers.
 World summit for sustainable development (Sep 2002), JohannesburgS.A.
 Mian Muhammad Nawaz Sharif P.Mof Pakistan, (April 2014) BAVOforum
China: Speech on Energy crisis and Asian Affairs.
 RStephan and William J, USAID, Aregional review of social safety net
approaches in support of energy sector reforms.
 Muhammad Shah Bacha,Accounts Officer, TESCO Hayatabad, Peshawar.
 Interview of Senior Tribal Jirga member of Afridi Caste (Name Hidden).
 www.livescience.com
 www.businessdictionary.com
 www.TESCO.org.pk
 www.wikipedia.com
 News papers include DAWN,The NEWS,Daily Mashriq and Daily AAJ.

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