Case Analysis OB

Case: Why are we loosing all our good people?

Brief description:

The case at hand (Refer Appendix I) deals with attrition of high performing top level employees at

Sambian Partners. Although the company has always prided itself as a great place to work, still the

talented people are leaving which has left its CEO, Helen Gasbarian perplexed. So she asks Mary

Donnilo, the head of HR to probe into the reasons behind recent exit of Tom Forsythe, Sambian’s

assistant director of commercial design. However during the exit interview Tom refuses to divulge the

exact details. The situation gets worse when rumours in the company start flying thick and fast and one

such rumour of Adrienne Perle, another employee following Tom’s footsteps is brought to the notice of

Helen by Bob Wortham, the vice president of engineering. In a desperate attempt to make Adrienne

stay Helen in a jiffy decides to promote her for which she draws flak from Mary for being

temperamental and unfair. After few weeks an employee survey is conducted in the company which

brings to the fore people issues and grimaces that Helen thinks should suffice answering the question

that-“ What really is driving people out the door?”

Case Analysis:

The above case is a typical example of lack of employee engagement in an organisation. Sambian

Partners grapples with the below mentioned issues:

•

Unclear vision and mission statement:

Engaged employees invest mentally and emotionally in their work and contribute to their

employer’s success. They feel a sense of pride in what their company is striving to achieve as

well as a sense of empowerment that they have a role in helping to reach these goals. In this case

Sambian has failed to create a mission and culture to which high performers feel connected and

committed. When Tom’s pet project looses a bid, he’s disappointed because he feels a

misalignment between the direction that the firm is taking and his own aspirations.

•

Weak manager-employee connect:

Connection is a vital link in the employee engagement chain and the most important relationship

is a strong relationship at work between employees and their immediate supervisors. In this case

there is weak such relationship on the account that in case of Adrienne Perle she didn’t discuss

the issues with Bob Wortham, her immediate manager.

•

Over reliance on the self conducted surveys :

At Sambian there are many below the radar issues at play which cannot be gauged by the

surveys conducted by the organisation. Rather than just conducting these in house surveys

Sambian should also establish an open door policy so that employees know that they can talk to

someone above their supervisors if they have a complaint

HBR Case Study

BY EDWARD E. LAWLER III

COMMENTARY BY ANNA PRINGLE,

F. LEIGH BRANHAM,

JIM CORNELIUS, AND

JEAN MARTIN

Why Ar e We Los ing All

Our Goo d Peopl e?

Sambian Partners has prided itself on being a great place to

work, but now talented employees are leaving. What’s going on?

MA RY DONIL LO , the hea d of hu- man resou rces at Sambia n Partner s, motione d Tom Forsythe, Sambia n’s assis tant directo r of comme rcial design, to a comfortabl e chair in her office. It was late on a Thurs- day aftern oon, and the Chicago sky looked like slate. The darknes s ou t- side mad e the overhea d fluorescent lights in her office seem even mo re glarin g tha n usual.

“Hey, Tom,” she said, addin g an ex- tra bit of warmt h to her voice. “I was so sorry to hea r that you’ve decided to leave. I know your min d is made up – everyone’s alread y tried to talk you out of it. But I do hope you can

help us unders tand why.” She pause d and offered a rueful smile. “It’s a huge loss, but maybe we can lear n something from it.”

Tom sat stiffly in his chair, one side of his face partially covered by a few strand s of dark hair that had escape d his pony tail. The lights brought out the bags under his eyes, and his five o’clock shadow looked more like a seven. With a new- born at hom e, he probably had n’t been getting enough slee p, Mary though t.

“Well, I think you know that I wasn’t out lookin g,” Tom said.

“Their headhunter came to me, and, wh at can I say? It’s an

of-fer I could n’t refus e. I mean, a direct- admit partnership to J&N? It really is an opportuni ty that doesn’t come along often .”

Mary could n’t help blinking at the mentio n of J&N, Sambia n’s much larger competito r. In the past year, it had seemed to step up its raids on Sambia n’s talen t pool, lurin g some very capable people over to “the dark side,” as Sambia n’s CEO, Hele n Gas- barian, liked to call it. “I’m glad for you,” Mary managed to say.“Although I wish it were anywhe re else.”

“I kno w.”

Mary studied Tom’s face for a mo- men t, wonderin g how to press for mo re. No unplanned depa rture was good news, but this one was really setting off alarm bells. Tom was at the top of his game; at 35, he’d been with Sambian nearly eight years. The compan y had been like a family to him, even afte r he got married and had child ren. He’d won a slew of design awards, and he was on the CEO’s sho rt list of high performer s. Ma ry could see the attractio n of a partnershi p position . But was that the whole story? At Sambian, Tom enj oyed the same kind

HBR’s cases , which are fiction al, present commo n manageri al dilemmas and offer conc rete solutions from experts.

D an ie l V as c o n ce ll o s

HBR Ca s e S t u d y W h y A r e We L o s i n g A l l O u r G oo d P e o p l e?

of authori ty he would have at J&N, if not mo re. He chose his project s, set his own prioritie s. Did he know how hard it would be to earn that kind of autonomy at a new firm, partner or no?

and it showe d plainl y on her face.

“Workin g on the memo?” Mary asked gentl y.

Helen nodded .“Not much

hb r.or g

Offer yo ur advice on this case at

LosingGood People.hbr.org.

Francis co, New York, and London.

Hele n looked ha rd at Mary. She wished she could put the blam e for losing Tom “I’m sure it’s no news to you that you

were coming up for promotion ,” she ven- tured. “If not this year, then maybe the next. Would it have made a difference if the raises had been bigger? For that matter, would it make a difference now?

I mean , the re’s no sham e in reconsid- ering – you really are highly respected here, you know.”

Tom looked at his hand s. “It’s nice to hear that, Mary,” he said. “But of course I’ve already accepted. And anyw ay, it’s time to move on. I have to challenge my- self, keep it fresh.”

“But you’ve always managed to keep it freshe r tha n just about anyone. Are

fun. I was just going to send it to you so you could look it over. How’d the exit interview go?”

Mary confesse d that Tom had n’t re- vealed much. “He didn’t want to get spe- cific about why the grass is greener the re or tell me about anythin g that made him unhappy here.”

When Hele n’s fathe r, Peter Gasbarian, had founde d Sambian , in 1975, it was supposed to be the antithesi s of a be- hemoth like J&N. His idea was to build a top-notc h architectu re and enginee r- ing firm by making appealing offers to

on her – or on someon e, anyone – but she could n’t. “You know, ever since Dad

founde d this compan y, we’ve tried to make it a great place to work,” she said,

sighing. “And I thin k we treat people really well. Whe re are we going wrong?” “I don’t know, honestl y,” Mary replied carefull y, hearing the bewilderment in Hele n’s voice. “But I want to be careful about not readin g too muc h into thi s. Obviousl y, we need to get to the bottom of it, but it might turn out that it’s not a trend, just a nasty coinciden ce. People leave jobs for all kinds of reason s.”

the projects themsel ves less challenging thes e days?” She avoide d the obvious question: Have you been unhappy?

Tom tilte d his hea d and looked di- rectly into Mary’s gray eyes, as if read- ing her thought s. “I’ve been very happy here,” he said. “The people are great. I’m

There wa s nothing Helen hated more

than losing staff to her firm’s

much larger comp etitor.

just that a fantasti c opportuni ty came along at a good time.”

Mary kept probin g, asking all the standa rd question s, but Tom demur red, me rely repe ating wh at he’d already told her. By the time the inte rview had ended and she’d seen him to the door, she felt deflated.

After leaving her office, Tom headed into the back stairwell , pulle d out his cell phon e, and speed -dialed his wife.

“Alyson? Hey. Yeah. You’ll be proud of me – I kept my mouth shut. I mean, you’re right about not burning bridge s, but who cares at this point? This place can be as screwed up as it want s. It’s not my problem anymo re.”

An Unhap py Memo

Early the next mornin g, Mary tapped on Hele n Gasbaria n’s door. She found Hele n starin g at her compute r screen, frownin g. The re was nothin g Helen hated mo re tha n losing staff to J&N,

young talen t. Rathe r tha n spen d years as anonymous “leverage” to fat-cat part- ners, young peopl e at Sambia n could start makin g thei r mar k immedi ately on inte resting project s. It was no coinci- den ce that he had stopped mulling this idea over and turned it into reali ty after his only child announ ced she was appl y- ing to architectu re school.

It was also no surpris e whe n Helen took the reins followin g her father ’s death, in 1997. By the n an award-winning architect in her own right, she made it her missio n to increas e colla boration among the firm’s cutting-edge designer s, engineer s, and client account manager s. As a resul t, inn ovation had flourished in gene ral – and, in particula r, the firm had been in the vangua rd of the “green building” movemen t. By the time othe r, larger firms were just startin g their green practi ce group s, Sambian had al- ready designed dozens of LEED-certified building s. Riding the growth wave, the

compan y had opene d offices in San

Hele n ponde red the poin t. “Well, that’s tru e enough : P at Doughe rty moved to Irelan d ‘for family reason s.’ Irena Milkovic decided to go solo – I’m still trying to figure that one out. And now Tom, to a partnership at a big tra- ditional firm.” She shook her head. “But the fact remains that it is a trend. I want to know wh at we nee d to do to keep the rest!”

“I have a few theorie s, Helen ,” Ma ry said, as soothingl y as possibl e. “But to see whethe r the re’s anythin g to them, I’d like to move this year’s empl oyee sur- vey up on the schedul e. I think we need to get some new data in front of us.”

Helen turned back to the compute r. “Yes, do the survey,” she said. “Do it as soon as you possibly can.”

Th e Word on the Street

Designer Hal Pope and engineer Savan- nah Dorsey were two floors down in Sambia n’s large kitchen , heating up their lunche s in the microwaves. They were

HBR Ca s e S t u d y W h y A r e We L o s i n g A l l O u r G oo d P e o p l e?

both subdued , havin g read the memo bearing the news of Tom’s depa rture.

“Tom sort of chec ked out whe n we lost that Mar ko bid,” Savannah ventu red. “He really wanted to see that design get built. It was gorgeou s, with all that light and air. And anyone could see that the price was righ t.”

Hal agreed.“The design could n’t have been better.” He lowe red his voice a little. “If only Paul Bonn ey had been able to point that out.”

Paul Bonn ey was the hea d of archi- tectu re sales. Savanna h stared at Hal. “You thought so, too,” she said. “His pitch sounded so, well, uninspi red.”

be as simple as that. Two kids now. He’ll be wor rying about college fund s.”

Savannah jumped back into the con- versation . “True, but you’d thin k he’d also be worried about quali ty of life. I guess Alyson must have decided not to go back to work. They’ll have him on the road cons tantl y.”

This Is No t a Drill

A mont h later, Hele n was scannin g a staff utiliz ation report whe n the phone rang. The phon e’s display showed that the call was comin g from Bob Wor- tham , the vice presiden t of engineerin g. Throug h the ope n door, Hele n saw her

rumo r about Adrienn e, Mary felt the blood start to drain from her face.

“It’ll be a real problem if we lose Adri- enn e,” Bob said. “She’s in the thick of a huge projec t, and the clien t loves her.” He gave Mary a hard look as they passed Jessie’s desk. “Wh at’s going on here, any- way? It’s like our talent is being sucked out by vampi res.”

Hearin g the m ente r, Hele n turned away from the windo w. “OK, Bob,” she said. “Wh at exactly is this rumo r?”

“Peopl e are picking up a vibe that she might follow Tom to J&N,” Bob be- gan, pulling the door shut. “The two of them were kind of on a wavelength. It would n’t surpris e me if he wante d to find a home for her the re.”

“We really value you around here,

and

I want you to be happy. I don’t

want you to even think about

leaving.”

Helen shot a look at Mary. “No non- compete?” Presumabl y, Tom had signed the standa rd cont ract preventin g him from taking talent or clients with him to the competition.

“Oh, sure,” Mary replied. “Tough to en-force, though ,” she added, immedi ately

Adrienn e Perl e, anothe r colleague from engineerin g, could n’t help over- hearin g as she reache d past the m for some utensil s. “He’s uninspi red,” Adri- enn e said. “And he’s not the only one. It’s really a pity when you have someone doing incredibl y creative work, and the sup port structu re isn’t the re to let it see the light of day. All the salespeopl e fo- cus on is cutting the deal. If you ask me, that’s why Tom is leaving. He’s a first- class architec t, but if he doesn’t have first-class sales and mar ketin g behind him, he’s no one. He’s the tree falling in the forest. I’ve tried tellin g peopl e up- stairs that we’re veerin g off base. But nobody’s listenin g.”

Hal shook his head . “I don’t kno w, guys. Tom had plen ty of wins. Mo re work than he could handl e. I just think he looked above him and realize d he was going nowhe re fast. No one on the executi ve team is even close to retirin g, and the org cha rt is top-heavy as it is. Whe re’s the career path?”

Adrienn e pulle d a sour face, indi cat- ing agreemen t. “I wonde r how much he’ll make as a pa rtner at J&N? It could

assis tant, Jessie, move to pick it up at her own desk.

“I’ve got it, Jess,” she said, lifting the receiver. “Hi, Bob. What’s up?”

“I might need your help on somethin g. I’m afraid we’re at risk of losing Adri- enn e. It’s just a rumor so far, but I want to jump on the situ ation .”

Hele n grima ced. “Adrienne ? You’re right – we don’t want to lose her. Why don’t you come up now?”

Hanging up, Helen called out to Jes- sie. “Can you see if Mary is free? If she can ma ke time right now, that would be great.”

She stood up, wal ked over to the win- dow, and pressed her forehead against the cool glass. On the plaza below, a few late luncher s cluste red aroun d a ven- dor’s stainless -steel cart. She closed her eyes. Another loss for Bob, she though t. Was he part of the problem? She shook her head , refusin g to pursu e that line of though t. The best way to dec rease attrition surely could n’t be to fire loyal empl oyees.

In the hallw ay outside Hele n’s office, Bob ran into Mary. As he relayed the

wishing she had n’t.

“Oh, I’ll find a way,” Helen spat. “Even if I can’t win, I can ma ke life tough for him.”

Mary and Bob exchange d glan ces. Helen turned to Bob, on the offensi ve now. “So you’re telling me we should n’t be surprised , but I’m also getting the sense that you haven’t done anything in anticip ation of this.” She could n’t resist adding a swipe at Mary. “And why are you waiting a round for the satisfaction survey results before taking any action?” Mary opene d her mout h as if to objec t, but Helen waved her hand imp atientl y. “OK, look,” she said. “I’ll talk to her. Let me see wh at I can do.” She wal ked to the door and opened it.

“Jess, call Adrienn e Perle and ask if she’s availabl e. I want to see her as soon as possibl e.”

Oh , Won’t You Stay?

Ten minute s later, Adrienn e appea red in Hele n’s doorway. Her heavy-framed designer glasses made it a little difficult to read the expression on her face, but her body languag e signale d anxie ty. It

wasn’t every day she was summoned to the CEO’s office.

A few moment s of small talk pro- longe d the awkwardnes s, but Helen got to the point as quickly as possibl e. “Adrienn e, I’ve hea rd an alarmin g ru- mor – that you migh t be considering a job elsewhe re. I certainl y hop e this isn’t tru e.”

Adrienne looked down at the coffee table and then around the room as if to see who migh t have spilled the bean s. “Rumor s spread fast aroun d here,” she said finall y.

“I want you to tell me the truth – in to- tal confiden ce, no repercussion s,” Helen said pleadingl y. She paused for effect.“Is Tom Forsythe talking to you?”

Adrienn e’s eyes widened slightly, and her answer seemed, to Helen, a little too quick. “Tom has nothing to do with this,” she said. “I mean, it’s true that I talk to him. We’ve known each other for a long time – since I got here, five years ago. He’s probably the closest thing I’ve had to a mento r. And I guess I do feel a little lost now that he’s gon e.”

“Well, my job is to make sure that you don’t feel lost. We really value you around here, and I wan t you to be happ y. I don’t want you to even think about leaving.” She paused .“Is it possibl e that Bob could play more of that mentorin g role?”

With an uncomfortabl e shru g, Adri- enn e bega n formul ating a carefu l re- spons e. “Well, it’s not so much , um…” Her voice trailed away.

Hele n let her off the hook. “Well, let’s figure out how we can fill that void.” It was clear that Adrienn e wasn’t being totall y forthcomin g but impossibl e to know how muc h she was withholdin g. Of cours e, she would know better than

Hele n had know n that the sudden- ness of her executi ve decision would not sit well with Mary, but the intensi ty of Mary’s reaction surprised her. She had, after all, succeeded in keeping Adrienne on board. “Despe rate times call for des- perate measu res,” Helen offered in her own defens e.

“But that’s just it,” Mary cried. “It will look like an act of despe ration to anyone who hea rd the rumo r. And worse than that, it isn’t fair. If that job is availabl e, the re are other people who should get a crack at it. It’s not right that they should effecti vely be penalize d becaus e they were the loyal ones. Wh at kind of signal does that send?”

“I’ll tell you wh at signal I thin k it sends. It tells people that we aren’t so const rained by HR procedu res th at we can’t ma ke exception s for fast-rising talen t. That’s a positi ve messag e. And as for Adrienn e, don’t worry about her. Everyone loves her. She’ll step up to the plate.”

Mary shook her head. “It’s not a ques- tion of populari ty or attitud e. She’s miss- ing some of the competencies…”

“Well, aren’t we all! ”Hele n interrupted. “Sometimes I think we focus too much on the things that aren’t quite perfect. If Adrienne were on the outside and sent us her résum é, we’d say she was perfect for this job. Tell me that’s not tru e.”

Th e Voi ce of the Peop le

A few weeks after the tense encounters over Adrienn e, Mary tappe d again at Hele n’s door.

“Survey result s time,” Mary called out in a singson g voice, glad that she and Hele n were back on a happ y foot-ing. She sat down across the desk from

amples of depa rtments whose results di- verged from the averages. And, as always, the open -ende d question s had yielded food for though t. Commentin g anon y- mously on their survey forms, a few em- ployees had complaine d of too much deadw ood in the project manager rank s. One staffer referred to “certain prima donnas” who cared mo re about winning awards than staying on budge t. The ad- minist rative staff was, for the most part, neut ral. Some resented the evening and wee kend hour s they spen t when , as one phrased it, “someone higher up the chai n procrastin ated.” The perks were good. The perks were bad. The perks were skewed to the younger empl oyees. The younger empl oyees didn’t feel val- ued enough.

Helen listened for 20 minute s, saying little but shakin g her hea d frequentl y. Then, whe n Mary was in the middle of reading a comment a bout the snack and beverage choices in the kitchen, she interrupted.

“Oh, that one was min e,” she joked. Mary played alon g.“I thought so. And don’t worry, I’m on the case.” But she knew the boss had hea rd enough for the momen t. Closing the report cover, she leane d back in her chai r.“I know it’s hard to sepa rate the signal from the noise here, but at least it gives me some mo re ideas about wh at to probe for when I’m talking to people one-on-one.”

“And that migh t be enough ,” Helen said, “if only they would give us straight answers.”

How can Sambian discov er what’s really driving pe opl e out the doo r?

to say that Tom was recruitin g her, even _{Hele n and hande d over a copy of a} if he was. Recallin g Bob’s not e of despe r-

ation earlie r, Helen made a decision. “In fact, maybe you would let me play a little of that role myself. I’m promotin g you.”

Whi ch Is Worse?

“Helen , you can’t do that! Adrienn e’s only a level-six empl oyee – she’ll drown in that position .”

cha rt-saturated report. “I’ll give you the big pictu re first. Overall, peopl e at Sambia n are quit e satisfie d with just about every aspec t of thei r empl oyment experien ce.”

Helen groaned.

“I know, I know,” Mary continued ,“but once you get into the details, the re are some nuan ces.” She offered a few

ex-Edward E. Lawler II I (elawler@marshall.

usc.edu) is the Distinguished Professor of Business at the University of Southern California’s Marshall School of Busi-ness and the founder and director of the university’s Center for Effective Organiza- tions. His latest book is Talen t: Making

People Your Competiti ve Advantage