Why Are We Losing All Our Good People - Case Analysis?

Background

Sambian Partners is a family-owned architecture and engineering firm. It was known for innovation and had been a front-runner of the industry for "green building" movement. The CEO Helen Gasbarian firmly believed the company offered a great environment to work, however, for some unknown reasons the company struggling to retain its top talents. After Tom Forsythe, one of the star employees left and defected to a rival company. Helen urged May Donillo, the head of human recourses to conduct an employee survey to find out the root causes behind the departures.

Meanwhile, Adrienne Perle, another top performer from engineering was going to quit, Helen promoted her regardless the objections from Mary. When the survey results came back, it did not define any problems or raise the red flags for the management.

Diagnosis of The Problems

There were three major management issues in Sambian Partner and caused its keep losing talents:

1.Problems With Leadership
2.Poor Leader-Member Relationship and Communication Barriers
3.Lack of Recognition and Motivation

Problems With Leadership

Helen inherited this position from her father.

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Although she was an award winning architect and very passionate about the firm, she was extremely overwhelming and was lack of leadership skills. In fact I believed her personally was not suitable to the company leader role. My first impression about Helen was her impatience and quick tempered. She was meaning, impulsive and made people feel stressful. I noticed that every time she had a conversation with her subordinates, they always felt so nervous and chose their word very carefully.

Secondly, Helen was lack of long-term vision and decision making skills. She tried to fix problems with short term solutions.

She bypassed the suggestions of Mary and ignored the long term impacts of her decision of promoting Adrienne on other employees. In addition, Helen failed to empower leadership and preferred to make decisions on her own. When problems came up she did not call a group meeting to involve every senior managers in. Instead of exam the true motivations of employee's departures with the team, she made the judgment based her instincts and feelings.

Mary on the other hand was lack of problem-solving skills and management skills. There were two fine employees quit before Tom, and I supposed she had conducted quit interviews with them as well. Clearly there was something went terribly wrong, she neither investigate on that nor come up any follow up actions. Even after Tom's departure, the only thing she did was to move ahead the schedule of yearly employee survey which did not carry any kind of priority and was clearly insufficient to help the management to understand the undergoing crisis. Furthermore, as an expert of human recourses management, she did not stand her ground and the HR seems to run based on Helen's personal willing rather than the good for the organization.

Poor Leader-Member Relationship and Communication Barriers

In addition of leadership problems, Sambian Partners has communication gaps and poor quality of leader-member exchange between management and the employees. According to chitchat among associates from engineering department, Tom's proposal was turned down by the head of sales and no one was there to defended him, thus discouraging him to continue stay at Sambian. It seems like Tom was not alone, many employees had the similar experience as Tom's, their voice and thoughts were never heard by management.

There was also a weak connection between employees and their upper management. Bob Wrotham, the VP of engineering didn't aware of Adrienne - one of his most talents was leaving until rumors came out. Another barrier that affected communications was the company structure. Mary claimed that "Adrienne is only a level-six employee" and that implied Sambian has a very deep and formal hierarchy. That made both upward and downward communications even harder.

Lack of Reward and Motivation

Sambian's leadership did not spend their time and energy to create a culture for its key stakeholder - employees to feel connected and committed. The only thing tied them up probably because of the money. In this case, as one of the top talents in the industry, Tom's hardworking and value was underappreciated by the management. They failed to transform recognitions into actions. Upon his exit interview, the company still can't offered him a promotion and a clear career path. In addition, the management failed to recognized the expectations and needs from their employees. With no motivations and completely disconnected from the leadership, Tom and other talents have no reasons to keep staying when better opportunities show up.

Course of Actions

First, I would recommend the company to hire a group of consultants and a professional CEO to help run the company since Helen's current management skills and leadership style was not suit for the role as a CEO. Meanwhile, Helen should form a committees with senior managers and consultants to develop her management skills, improve her weaknesses, and reestablish leadership. Mary and other senior leadership also have to participate in the committees and engage the improvement program. She must make sure everyone on management positions understand creating a value proposition for attracting and retaining employees is a common goal for everyone.

Secondly, I recommend to break traditional organization hierarchy and build informal communication channels. The company should create a work environment conducive to employees speaking openly about their problems and concerns. The management should also give feedback and share their thoughts and consideration with employees when proposals have been turned down.

The management should realize money is not the only motivation keep employees happy. They should study the hierarchy of needs and invest more time in their employees and consistently appreciate their contributions. A clear and fair career development path will be given to every employees. I recommend Sambian takes a gap research on the market and see the gap between itself and its rival and learn from it.