Interpersonal Leadership Development Report for Petronas Group

This report provides a comprehensive analysis of interpersonal leadership within Petronas, a major oil and gas company in Malaysia. It begins with an introduction to interpersonal skills and their importance in leadership, followed by an overview of Petronas, including its history, operations, and financial performance. The report then identifies the objectives of the study, which include assessing current leadership performance, skill needs, and improvement potential. It delves into the leadership styles and concepts prevalent within Petronas, highlighting both strengths and weaknesses. The report proposes a leadership development program designed to address identified organizational leadership problems, including employee retention and safety concerns. This includes a detailed budget, resource plan, and timeline for implementation. Furthermore, the report outlines the potential benefits of the proposed leadership development program, such as improved employee morale, increased safety, and enhanced organizational performance. Finally, the report concludes with a reflection on the critical thinking and core capabilities needed to achieve the task, evaluating current leadership experience, potential, and competencies, and identifying areas for personal leadership development and career progression.

Running head: INTERPERSONAL LEADERSHIP
Interpersonal Leadership
Student’s name:
Name of the university:
Author’s note:

1INTERPERSONAL LEADERSHIP
Table of Contents
Part 2: Company Report..................................................................................................................2
1. Introduction..................................................................................................................................2
2. Overview of the Petronas Malaysia.............................................................................................2
3. Objectives of the report...............................................................................................................3
4. Current leadership performance, skill needs and improvement potential...................................3
4.1 Leadership styles and concepts within Petronas....................................................................4
4.2 Leadership performance and skill needs................................................................................5
5. Proposing leadership development programme addressing organisational leadership problem. 6
5.1 Leadership problems..............................................................................................................6
5.2 Organisational challenges......................................................................................................6
5.3 Leadership programmes.........................................................................................................7
5.4 Proposing a budget plan, resource plan and time plan..........................................................8
6. Identifying and explaining potential benefits for the organisation..............................................9
7. Conclusion.................................................................................................................................11
Part 2: Evidence Report.................................................................................................................12
1. Introduction................................................................................................................................12
1.1 Background information..........................................................................................................12
1.2 Rationale of the research.........................................................................................................13

2INTERPERSONAL LEADERSHIP
1.3 Research Problem....................................................................................................................14
1.4 Research objectives.................................................................................................................14
2. Literature Review......................................................................................................................15
2.1 Importance of leadership within organisations....................................................................15
2.2 Different types of leaders in organisations..........................................................................15
2.3 Theoretical understanding of leadership and employee retention.......................................16
2.3 Possible reasons behind high employee turnover................................................................18
2.4 Possible threats regarding high employee turnover.............................................................18
2.5 Impact of leadership styles on employee retention..............................................................19
3. Research Methodology..............................................................................................................19
3.1 Types of investigation..........................................................................................................19
3.2 Data collection technique....................................................................................................21
3.3 Sampling methods...............................................................................................................21
3.4 Data analysis techniques......................................................................................................22
3.5 Ethical considerations..........................................................................................................23
3.6 Research timeline.................................................................................................................23
4. Potential research perspective to explore improved effectiveness and efficiency of leadership
practices.........................................................................................................................................24
Part 3: Reflection for employability enhancement........................................................................26
1. Realising critical thinking and core capabilities needed to achieve this task............................26

3INTERPERSONAL LEADERSHIP
2. Critically evaluating current leadership experience, potential and competencies.....................27
3. Identifying areas for personal leadership development and career progression........................28
Reference List................................................................................................................................31

4INTERPERSONAL LEADERSHIP
Part 2: Company Report
1. Introduction
Interpersonal skills are quintessential elements in order to make leaders and they inspire
the followers to achieve the organisational goals. Interpersonal skills are associated with
communication skills and leaders must be eloquent to persuade the employees to follow them.
Leadership skills comprise the entire gamut to help the employees to build trust of the employees
within workplace (Antonakis and Day 2017). In this report, strategic initiative of Petronas
Malaysia is described for implementing the organisational change to achieve efficiency and
effectiveness of leadership. At first, specific leadership issues are explained at the first in
leadership performance, improvement potential and skill needs. In the following section,
leadership development programme is delineated. Furthermore, potential benefits of the
organisation are explained if the organisation would follow these changes and action plans.
2. Overview of the Petronas Malaysia
Petronas (Petroleum National Limited) is an Oil and Gas company in Malaysia and this
organisation was founded in the year 1974. This organisation is owned by Malaysian government
and this organisation takes the responsibility to the whole oil and gas resources of Malaysia. The
organisation is trying to add and develop value to the resources (Petronas.com.my 2018).
Petronas has it headquarter in Kuala Lumpur City and it is mainly serving worldwide. President
and CEO of the organisation is Wan Zukkiflee Wan Ariffin. Petronas mainly produces the
products like natural gas, petroleum and petrochemicals. They also provide the shipping service.
Revenue of Petronas was US$46 billion in the year 2016 and total assets of Petronas in the year

5INTERPERSONAL LEADERSHIP
was US$135.66 billion. Numbers of employees work in this organisation are almost 51,000.
Petronas has its subsidiaries and some of the subsidiaries are KLCC Property Holdings, Petronas
Gas, Petronas Chemical and MISC. Petronas Group has its business in more than 35 countries
and they have almost 135 subsidiaries. Therefore, the leadership qualities of the leaders in such a
long organisation should be well enough to carry forward the organisational objectives and
organisational expansion.
3. Objectives of the report
 To identify leadership issue within Petronas Group
 To explore leadership performance in Petronas Group in order to meet the organisational
objectives
 To propose leadership development programme for Petronas Group
 To suggest potential benefits for leadership development
4. Current leadership performance, skill needs and improvement potential
Malaysian oil giant is run by the Malaysian government and President of the organisation
has to listen to the Board of Directors. In the year 2015, previous CEO of Petronas Group Tan
Sri ShamsulAzhar Abbas got only 7 months contract extension as that time oil and gas industry’s
earning had been declining radically (Yazdaniet al. 2016). Petronas wants to contribute to the
well-being of the society. Petronas management has its own shared values and leadership
depends on integrity. Leaders and employees of the organisation focus on honesty and
uprightness.

6INTERPERSONAL LEADERSHIP
4.1 Leadership styles and concepts withinPetronas
Leaders of the Petronas follow the motto of Performance and Delivery that follows
according to the organisational aspiration in creating a high performance workforce and culture
within the organisation. Leaders of the Petronas do the culture that emphases majorly being
employees-oriented. Malaysian people believe in maintaining harmony and kinship among the
people. According to Al Shamsiet al. (2015), Petronas recruits the Malay ethnic people and the
leaders follow the Malay ethnic culture as the seniors in this organisation as seen as ‘father
figure’, ‘family’ like relations in the workplace and mutual help is followed. In Petronas group,
the leadership cultivates the idea of spiritual leadership as this is an emerging concept in global
workplace. As stated by Prabhakar and Yaseen (2016), spiritual leadership is about identifying
the values, behaviours and attitudes promoted by one’s belief and religious faith and it must
affect the result of positive human condition, well-being, satisfaction, psychological factors and
organisational commitment. The decisions about financial performance and sustainability of the
organisation are taken by the leaders. Spiritual leadership in Petronas taps to fundamental needs
of followers and leaders and both of them get more organisationally committed.
Transactional leadership is also known as theories of exchange in leadership. This type of
leadership is characterised as the transaction made between followers and leaders. In Petronas,
the leaders try to follow this type of leadership with the employees to value the mutually
beneficial relationship and positive competencies. According to Arnold et al. (2015),
transactional leadership has motivational value and it results in adequate rewards to the
employees. In Petronas, the leaders try to focus on leader-assigned tasks for the subordinates and
leaders try to give maximum pleasurable experiences to diminish the weakness of the employees.

7INTERPERSONAL LEADERSHIP
4.2 Leadership performance and skill needs
Wan Zukkiflee Wan Ariffin plays the role of transforming leader in Petronas and it is the
only Malaysian company to rank in Fortune 500 list. Petronas organisation is one of the most
profitable organisations in Asia and it is a highly reputed organisation in the worldwide. Petronas
performs like super majors in its field like British Petroleum, ExxonMobil and Royal Dutch
Shell. CEO of Petronas is trained as an accountant and he is a strong advocate. The leaders in
Petronas also strict in fiscal discipline and he provides the importance in teamwork. Leaders put
stresses on the importance of teamwork and they want that employees meet the standards of
professionalism and integrity (Bolman and Deal 2017). In the year 2011, Petronas started
Petronas Leadership centre, a training department with 110 accommodation rooms where more
than 20,000 employees attended learning programmes. Management of Petronas started Leaders
Develop Leaders programme (LDL) to nurture the employees to embark in the field of future
leadership. In Petronas, 55% of employees were below 35 of age in the year 2016 and potential
employees are identified for future development in the workplace (Nst.com.my 2018).
On the other side, Petronas failed to grab large revenue and in the year 2016, it acquired
US$ 46 billion compared to 55 billion what they had acquired in the year 2015 (Latham 2016).
Therefore, it is quite clear that the revenue is falling and leaders are facing questions. Petronas
has been facing the issue of safety and integrity of labourers in the oil fields. In addition,
retention of the employees is decreasing in Petronas. The leaders lack the interpersonal skills to
motivate the employees to be in Petronas. Facilitating skills are less in Petronas in recent time
within workplace where team members do not come with possible solution (Northouse 2015).
Leaders lack in mentoring skills and they do not provide constructive guidance to the staffs.

8INTERPERSONAL LEADERSHIP
5. Proposing leadership development programme addressing organisational leadership
problem
5.1 Leadership problems
Of late, the organisation has been facing the issue of employees’ retention as safety is less
in Petronas. Current employees of Petronas who work as labourers in oil and gas fields have
been facing very serious integrity and safety issues. The catastrophic conditions have been
prevalent in most of the oil fields across the world and it has been creating massive harm and
extensive damage to the labourers. This incident came as a blow to the company’s reputation.
Leaders in Petronas mainly face issue regarding communication as this is a large organisation
having large number of employees (Fuhlendorf 2016). Employees are disengaged and leaders
need to show the way for the future development. Petronas must be found it difficult to prioritise
the leadership implementation programme and they are facing the issue of rehiring of the
employees.
5.2 Organisational challenges
In recent time, Petronas Group has been facing the large liquidity buffer and capital
management issue. Financial issue is high and this downturn is caused by oil slump and
flexibility in economic sphere. The leadership styles of Petronas are chiefly based on forward-
looking and the leadership team can understand the low prices of the products. Mission of
Petronas is to work as business entity, oil and gas is their core business and they want to ass the
value to the resources. Petronas group has been dealing serious problem regarding safety
standards. EU launched a new Directive in the year 2013 aiming to maintain the highest safety
standard in oil and gas sector (Skendallet al. 2017). Petronas has not yet taken any chance in
framework for safety of the labourers and environmental pollution. In addition, if the employees

9INTERPERSONAL LEADERSHIP
and labourers leave the organisation, it is an alarming situation for Petronas to retain employees.
High turnover rate leads to less profitability and revenue (McCleskey 2016). Leaders need to
steps to reduce the employee turnover through ensuring safety in oil fields, training and increase
hiring expenses. High turnover rates of the employees create low employee morale and it also
increases responsibilities and workloads of the existing employees. This occurrence may lead to
Petronas to attract good talent in future and Petronas will face the issue of deteriorating product
or service quality.
5.3 Leadership programmes
Petronas leadership programme can be segregated into specific areas. According to
Komives and Wagner (2016), it is believed that personal development programme is a key action
in leadership development. Leadership areas will be followed in this programme are:
1. Communication
2. Emotional intelligence
3. Personal Mastery
4. Leadership and management
5. Relationship management
6. Team development
6. Delegation
7. Counselling
8. Taking and giving feedback

10INTERPERSONAL LEADERSHIP
9. Problem solving
10. Appraisal
11. Listening skill
12. Motivation
At first, the leaders in Petronas need to learn about ‘self’ and they need to learn about
how mind works. In this section, leaders will learn about team development and working with
others techniques. Leaders in Petronas need to learn about leadership vs management and dealing
the outdoor challenge. Most importantly, in the leadership programme, leaders will get to know
about individual differences and motivation.
5.4 Proposing a budget plan, resource plan and time plan
Time Objectives Resource required Budget
Within 3 months 1. Improving
communication
2. Improving
emotional intelligence
Software, PR team
development
1200 ringgit (RM)
Within 6 months 1. Improving team
development
2. Improving
delegating
Potpourri activities,
intranet software,
projects
2000 ringgit (RM)
Within 12 months 1. Developing Magazines,
technologies, team
4000 ringgit (RM)

11INTERPERSONAL LEADERSHIP
problem-solving skill
2. Improving listening
skills
monitoring person
Table 1: Leadership development programme
(Source: Self-developed)
6. Identifying and explaining potential benefits for the organisation
Effective leadership training will be helpful for Petronas and leadership learning may
help the organisation to take effective steps to increase the safety of the labourers and increase
employees' retention rate.
Increase productivity:
Leadership programme of Petronas will eventually increase the productivity of the
organisation. Leadership is about understanding the employees within the workplace, if the
leaders get to know about employees’ concern, they can solve the issue (Dinhet al. 2014). In
today’s workplace, emotional intelligence is also an important issue and leaders need to ensure
the emotional satisfaction of the employees. Leadership training encompasses emotional
intelligence that can facilitate emotional skills. Petronas needs higher productivity in order to
grab the extra revenue.
Retain people:
In Petronas, 67% of the white collars employees leave the jobs, because of the leaders.
Leaders need to maintain a good relationship with the employees in order to maintain peace in
the workplace. Petronas can get profit from leadership training through retaining people and