HRM Case

An incident that reflects some of the problems faced by organizations and

individuals in HRM

An assignment submitted to Prof. N. M. Agrawal towards the partial completion of the

course on Human Resource Management as part of the 5th quarter of the PGSEM
program. The names used in the case have been changed for anonymity.

Ribha Mehrotra (2004139), Senior Applications Engineer

Sudha Anubhav (2004151), Associate Project Manager

Indian Institute of Management, Bangalore

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 Alok

Alok stood on the rooftop of his five-storied office building watching the Bangalore
skyline and trying to recollect how wonderful his first three and a half years in the
organization had been. At present he was restless, wondering what had gone wrong in the
last year and a half. He had just had an argument with his senior manager, Manish,
regarding the timelines in which the current project could be delivered. The argument
had got so heated that Manish had spoken rudely to him and indirectly hinted at getting
somebody else to lead the team.

Alok had joined Zentex Technologies, a California based startup, directly after
completing his graduation in Computer Sciences and Engineering from IIT Mumbai five
years ago. Being highly ambitious and carrying with him the excitement of joining a
small organization, Alok had reached Zentex Technologies in Santa Clara in sunny
California. Over the next year and half, he had surpassed all expectations, and had grown
from possessing mere educational knowledge to commanding an excellent technical
know-how of the companys software product. He had outperformed all his peers in the
performance appraisals. The company had given him a big salary hike and a bonus. He
had achieved the title of problem solver among the ten-strong engineering team and he
took pride in it. Zentex had been running on a shoestring budget and after year and a half
of its starting, its founders decided to start an offshore division in Bangalore, the Indian
Silicon Valley. The decision was taken mainly because they had struck a deal with a big
client and had desperate needs to expand.

Alok, being a smart kid, was chosen to go to Bangalore along with Ashish, one of the
senior managers in Zentex, to set up the local office. Ashish was to mainly handle the
operational aspects of getting the division setup and Alok was to lead a fifteen member
team to work on the new project that had just kicked off. Alok had perceived this to be a
great breakthrough and was determined to work even harder and make the project a
success. He had put in 14 to16 hours a day and again managed to outperform his peers,
despite working in a new environment and having additional responsibilities of ramping
up the Bangalore team, recruiting more people and helping Ashish in stabilizing the new

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office. In all, Alok showed great leadership and managerial skills and truly impressed his
bosses back in California. Alok stayed back after Ashish left and continued leading the
Indian technical team. He was exhilarated and extremely happy whenever he thought of
the responsibility he had been entrusted with by his organization. He was a part of all the
decisions that were made by the management for the Indian sub-division. Not only had he
become strong in the technical aspects of the companys software product, but had also
started participating in management meetings and providing inputs to the senior
management regarding decisions about the Bangalore division. He felt a great bond with
the Bangalore office and a sense of having played a great role in its success. Indeed, Alok
had achieved a lot in a very short time.

Once the Indian office was working smoothly and a few senior managers had been hired,
Alok went back to the US office. After a small six months stint in the US office, he
decided to come back to Bangalore as all engineering activity had shifted completely to
India. Bangalore was where all the technical action was and Alok decided to return to
what he thought he did the best. During the same time, Zentex struck the biggest deal of
its lifetime and had decided to further expand the Bangalore team.

Over the next year and a half, the Indian office grew from thirty to a mind-boggling
number of eight hundred. Even the founders of the company had not thought that they
would have to grow at such a rapid rate. The fast growth brought with it a large number
of organizational restructurings. The Indian office now had a solution center head, a large
number of senior managers and project leads. The organization was also struggling to
become more stable now, to define some processes and enable itself to deliver the
projects on a more predictable basis. The customer base had increased from three to ten
and there were a lot of teams working on different projects in different technologies.
Although everyone knew Alok and held him in great regard when he had been here
earlier, now he was a stranger in the office he had himself helped set up. He felt a little
lost and missed the energetic and informal office atmosphere he had left behind. In any
case, he went back to leading a team of 20-25 developers and stared working with
enthusiasm on the new project.

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Sadly, things were not the same any longer. With new people, especially at the
managerial level, came lot of new ideas some good and some bad. Every now and then,
sudden policy changes were announced or sudden process changes were implemented.
Although this was expected in a growing company, what hurt Alok was that he was no
longer a part of the decision making process. Alok felt that this was because he was still
considerably inexperienced compared to the new hires and despite having proved his
leadership abilities earlier, he was being sidelined now. With the growth, a lot of politics
had also started in the company, which Alok detested. He wanted the company to do
good work and win big customers, but not everyone around him shared his passion. He
felt that the new managers were only interested in getting all the credit for all that is good
and in making a place for themselves in the company. Most of his colleagues and good
friends had left the organization to pursue either higher studies or to join other
organizations. He felt left out of meetings and discussions, and thought he could have
added value to the process of decision-making. He perceived that he was constantly
refuted in the discussions he was invited to. He just had one consolation, that the old
timers, i.e., his US bosses, who were still with the organization still had faith in him and
his opinion was always listened to and considered by them. But since all of them were in
California, it was seldom that he got a chance to have a good interaction with them. He
felt really happy and comfortable whenever some of them were around in Bangalore.

Just before Alok starting to think about all this, he and his senior manager Manish were
making the project plan for the ongoing project. While making the timelines, they were
discussing as to how long it would take for a module team of five to complete its job.
There was a difference of almost a factor of three in the effort Alok had estimated as
compared to what Manish wanted. Manish was upset by the timelines and was worried
about his individual performance as he had already committed tighter deadlines to the
upper management without consulting Alok. Manish was trying to pressurize Alok to see
if by working longer hours or by reducing some testing and documentation, the time
could be reduced by half of what Alok had estimated. Alok, on the other hand, was
convinced about how a good project should be implemented and was trying to explain to
Manish that it would be bad if they delivered the project by taking shortcuts. Manish got
angry and accused Alok that he and his team were inefficient in delivering and that in his

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past organization they used to complete such assignments in much shorter duration. The
argument finally got resolved by Manish forcing an intermediate timeline and asking
Alok to do whatever it took to finish it by that time. Manish also mentioned that he would
need to have a word with the US management to convince them and explain to them the
current inefficiencies that the Bangalore division operated with.

Alok was now troubled by these new developments and his monotonous work life with
little growth. Over the past six months, he had faced many such situations and was trying
to figure out what it was that really went wrong. Did he commit a mistake by coming to
the Bangalore office? Should he go back to the US office and start looking after the non-
engineering activities like sales and marketing? Should he leave the organization and join
a new one and if so should he join a startup or an already well-established organization?
Should he directly talk to some of the upper management and explain to them his
concerns and issues? Would that really help?

These are some of the questions that were running in Aloks head as he finished his cup
of tea and started walking back to his seat to tackle the immediate problem of bringing
down the project timelines.

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 CASE ANALYSIS

Background

Although presented from the point of view of a single individual, the case
highlights some of the typical human resource problems faced by mid-size organizations
in a phase of rapid growth. When a company crosses the magic number of one hundred
employees and begins to grow towards another milestone number of one thousand, the
attention of the founders and the senior managerial team is more on securing the future of
the company and keeping the customers happy. The human resource processes and
structures do not keep the same pace of growth and take a back seat, causing a point of
extreme employee dissatisfaction, mistrust and a high attrition rate. In such cases the
problem may be further enhanced for the old employees who had contributed immensely
in the initial success of the organization. The decision to leave the company is a tough
one for such employees, but at the same time they feel tied down and restricted in growth
opportunities in the new organizational culture. The case presents the problems from the
perspective of Alok who had started his career with a start up which went on to grow to a
mid-size company in a short span.

HR problems in mid-size organizations

One of the main problems that Alok faces in the case is the loss of his sense of
autonomy and the power of decision-making. A small company operates in a very
informal atmosphere and there are no rigid hierarchies. There is a lot of open interaction

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and employees are encouraged to take their own decisions pertaining to day-to-day
project related activities. This is especially true for IT related start-ups where employees
can interact on a daily basis with the CEO and are entrusted with big responsibilities even
at the start of their career. A gifted individual has opportunities to grow at a much higher
rate as compared to bigger organizations because merit gets acknowledged and rewarded
more easily in the informal set up of a start up. This is exactly what happened to Alok.
But as the company grew and new senior managers were hired, formal designations,
industry experience and hierarchies became more important and the true capabilities of an
individual became secondary to some extent. The feeling of being wronged is more
pronounced in the case of a mid-size organization, as it is mid-way in its process of
defining the hierarchies and organization structure. In a large organization, rigid
hierarchies and loss of autonomy is somewhat taken for granted but in a mid-size
organization where things are not stable, employees expect more freedom and autonomy
due to the more uncertain environment.

The second crisis Alok faces in his current position is the fact that he has been
continuing on his current role for quite some time. He had been used to a challenging
work atmosphere but with the sudden growth of the company, a lot of managerial work
that he was used to doing earlier has been taken away from him. The growth in his career
has slowed down a bit, which is normal under the given circumstances but disturbing
from Aloks point of view. The easy interaction opportunities with the senior
management that he had access to in the U.S. office are also no longer available and he is
unable to discuss his career path with anyone.

Although politics is an integral part of any work culture with a sizeable

population, the problems related to politics in a rapidly growing organization are unique.
In an atmosphere where no well-defined processes exist, there is bound to be some
confusion and arguments over the right way of doing things. A large number of new hires
at the senior level aggravate the problem, as each person wants to make his/her own
reputation and place in the new company by pushing his/her idea of the right approach.
The problems of favoritism, taking credit for work one didn't do and not giving credit to
those who did, slowly start becoming a daily reality.

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Measures to alleviate HR problems in mid-size organizations

Small and medium-sized companies occasionally need high-level HR expertise

but do not always have the time, staff and budget to handle complicated human resource
issues. But ignoring these problems is not the solution. Somewhere the people assets need
to be aligned with the corporate goals for satisfying customer and sustaining growth.
Especially in a high growth environments and uncertain environments, if employees do
not feel engaged, empowered and appreciated, they lose the determination to drive the
business forward. The organization should take steps to tackle human resource problems
from the very beginning and not leave it for a later time when the employees start
quitting. This is exactly what is happening with Alok, who is not getting a chance to
show his true potential and is slowly getting the feeling of being overshadowed. The
founders and the old-time senior management of the organization in such cases need to
take an active interest in such matters and act as a proxy for the HR department till an
effective HR department becomes functional within the organization.

First and foremost, the organization should take care to educate the old employees
about the changes that rapid growth will bring with it. The existing employees should be
made part of the decisions or at least be informed about all changes in organization
structure, role changes, reporting hierarchies and processes. A conscious understanding of
expected changes will dilute the ill effects and also enable the old employees to be better
equipped to tackle the new environment. In the case of Alok, he would have been better
able to make his choices regarding a suitable role and would have taken care from the
beginning to not get trapped in the politics of new managers. On his own too, Alok
should take some initiative in understanding the changed atmosphere of the company and
should make attempts to assimilate and adapt to the new environment. Rather than

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blaming the processes and the circumstances for his plight, Alok should see how best he
can survive the new challenges faced by him.

Defining new hierarchies, structures and processes is inevitable with growth but
the organization should take care that the transition from the informal to the formal
environment does not undermine the contribution of old employees who are more
passionate about the organization and can still play a big role in its success. For example,
in the case of Alok the senior management should have taken care to give him a role
suiting his earlier achievements and not necessarily suiting his relative inexperience.
Hiring new managers and developing hierarchies should not necessarily imply restricting
the growth opportunities for the people who have showed their capabilities earlier. Also,
a person who has been a part of significant organizational decisions during its struggling
phase and has seen the company grow from a small one room office to a large set up
should continue to be a part of decision making for him/her to remain motivated.

Even in the case of senior management getting too busy with winning new
customers and planning for the future, they should allocate at least some time in
developing the HR policies of the company. Programs like employee focus groups where
unfiltered employee feedback can be received should be started from the beginning to
prevent favoritism and internal politics from becoming a menace. Adopting practices like
360-degree feedback, employee suggestion systems and service recognition will help the
senior management identify and reward true talent just like in a small start up
organization, while relying on the hierarchical feedback will not. These low cost HR
initiatives can help a mid-size organization to solve some of the human resource
problems without investing too much in this area. What is required is a conscious
understanding of the existence of such problems and the willingness to solve them within
the given time and using the available resources.