Anagram Finances started as a small org 10 yrs ago with only 50 workers. The employer Mr.Braganza is a XII passed man without any formal degrees to his credit. He employed people who he knew and who had reasonable capabilities of performing accounts work. No formal recruitment procedures were followed nor were any formal qualifications asked for. Now his son who has done his MBA wants to expand and improve the organizational activities. He hired an HR professional to conduct all the HR functions. He decides to discontinue the old 50 workers and employ properly qualified ones in their place.

The 50 workers rise in protest and request the senior employer to protect them and their source of income. The son reconsiders his decision and decides to give some less important jobs that do not involve much skill and decision making to them. But they refuse to accept this move and resent working under young juniors.

How would you handle the situation if you were to take over as the new HR Manager ?

From India, Dharwad

As Mr.Braganza started Anagram Finances from last 10 years with 50 workers, that means to say all 50 workers are working there from last 10 years, (As we know who makes man perfect - the answer is experience makes man perfect and strong in technical skills) so all 50 workers they are matured enough to stay in the company they will be well known about work ethics and working environment, if suddenly Mr.Braganza son wants to expand the company and he wanted to hire new employees, then definitely for new employees to settle down hardly it will take few years and Mr.Braganza son he may loss the revenue and here in this case study its not mentioned that the existing employees are not performing well so what we can do is we can train them so that they will work in dynamic way, and if you think Mr.Braganza son why he wants to hire new employees because in order to upgrade few new things so he wants youngsters to be hired, my point is instead of hiring new, he can train the existing employees so that they will start thinking new creatively.

even after giving training if Mr.Braganza son feels that they are not strong enough in technical accepts then he can highlight specified employees and he can send them working under young juniors.

From India, Bangalore
Shwetha ji,
what i feel instead of removing old experienced worker it will be better to train them and professional training should b given to them.
Slowly and slowly new blood should be injected from out side means slowly slowly step wise step new professionals should be involved instead of immediately otherwiswe production as well as environment of organization will spoil , it will badly damage the reputation of organization .
Daljeet Singh

From India
Dear Swetha

This case study is incomplete as many facts are not mentioned including but not limited to how the company is performing, what has made the Son to change employees, what might have happened, what is the need to remove old people in wake of expansion and improvement drive? etc etc.

The XII class passed Father v/s MBA passed Son have no match when doing business and actually the education does not matter. If you see the profiles of 80 % of Business owners - they are not highly educated including Mr Dhirubhai Ambani

Actually we in India overemphasize Education Level and less importance is given to rich experience and hence in most of the cases we do not hesitate giving huge pay & perks to novice MBAs / BTECHs and refrain to give even a suitable / amicable raise or pay hike to all the practically working people.

Working with Japanese I learned that Education is important and that makes you eligible to enter at certain level in organization. But thereafter all employees are judged and taken care by the equal opportunity and PMS without discrimination - based on their contribution.

By any means the Son is not capable (as in experience) to adjudge the people he is removing and only using his position / power to take such decision. This may lead to disaster in the Organization if the routine business / affairs are hampered by the employees or management action.

Improvement drives and Expansion projects are always employee engaging and inclusive tasks and can not be done by sudden exclusion of people and induct new one to fill their place. This is novice approach which will do only harm.

Debatable - still need more facts and research to arrive act right conclusions



From India, Mumbai
Dear Swetha,

Mr. Brangaza, who started Anagaran Finance 10 years is supposed to have the relevant experience in the relevant field though less qualified and have hired 50 workers. through whom he had been able to generate business and made profits.

Suddenly, his son being an MBA graduate, wants to expand the business is a welcome feature, since it generates more employment but removing the old employees for the expansion program is certainly not acceptable. however the management may take notice of nonperforming employees and other employees who are nearing 60 years of age and layoff such such employees, by way of giving a good and decent settlement package.

Settlement is a very difficult task because the old employees would have been hired for a lesser salary and so also their appraisals (increment) will have been minimum. Therefore, considering the present market value of the old employees apart from gratuity, PL reimbursement and their accumulated bonus the management may consider some extra amount as exgratia in lieu of their number of services rendered and see that these old employees layoff their jobs in a peaceful manner, without resulting to legal action.

Here the role of HR is going to be critical since Mr. Brganza belongs to GenX and his to Gen Y, hence thinking and temperament differs from each other, but in a situation the HR has to be more professional need to keep both the employee interest and the organizational interest in mind have to arrive at the consensus and resolve the issues.


From India, Bangalore

Mr. Shiv Khera, brings in a nice story to drive home his point in his book "You can win" and this issue looks as if a story taken from that book!!

First of all, law do not allow anyone to remove from the job, who are working and performaing well till date, just becuase of thier qualification, that too after 10 years. Its wrong ethically too.

Its worth for the MBA man to starts separate company and could prove to be cost effective and hassle free.

If he insist on managing old company itself, then only alternative is (as already suggested):

a) Make SWOT analysis and train your employees on thier weakness.

b) Monitor thier progress and even after sustanined traning, hand holding, if some one is performing, remove them after providing all necessary opportunities.

c) Infuse new talents slowly without troubling the existing setup and improve the erformace of the company.

d) Introduce Voluntary retirement Scheme, which compensates the employees adequately.

This is based on the facts given above. Hope this helps!!!

Best Regards,


From India, Bangalore
When an HR is appointed and do his duty he has to do only in such a way that it improves the business and he has to abide by the managment. What about the reaction from the father as he knows the business well. When any employee is terminated they can do so provided they settle the account of the employee according to the act. If HR takes his own idea of sending the employees on his own and bring in new employees then the matter has to be taken with the management. It is not that much easy for the new employees to take over and improve the business immediately. Old employees know how to work and improve the business.It is upto the Management to take any decision.
From India, Madras
Since you have mentioned, 50 employees have put-in 10 years of service, the question of removing them, does not arise at all. MBA man surely knows laws and acts in India.

1. To all employees, especially those who are above age 50, offer them VRS, which should be purely voluntary, absolutely no pressurizing. For remaining, my suggestion :

2. It is true that Experienced man gives better results, than the educated new employee. However, in recent two decades, business world has changed dramatically (globalization, liberalization etc etc). In todays world of internet, computers, mobiles, etc, involvement of talented people makes big difference, for an organization not only to compete well, but also for its own survival. Market trend, sales analysis, minimum purchase price, taxation, and effective communication, are some of the very important areas, where need to appoint intellectuals is compulsory.

3. Coming back to present case, In any type of company, where there are multiple departments/divisions, both the kind of people, talented and non-talented, are working, in each department. Sales, Purchase, Accounts, Logistics, Admin…

4. Since MBA son wants to go for expansion, we can presume that additional recruitment is to be done.

5. In each department, HR should make a chart of two sets of employees, (1) talented, (2) general. Newcomers, who are suppose to be intelligent, will occupy the seats in the first group, while the other support staff, would be adjusted from second group, i.e. from 50 old employees, who may have to take guidance from newcomers, and to learn working in new style.

From India, Mumbai
I thing that, 10 years experience is a long span. The 50 workers also have valuable experience in their fields. Its better to use . them in any other areas, where they can work., instead of throwing them out. In any organization the main asset are man power. If I HR manager, I convince the management, and discuss with the above said 50 employees, to utilize them in difference areas where they can show their maximum capabilities.
From India, Visakhapatnam
Dear Shwetha, I had quick look at your other posts. Please let us know whether this is a situation that you are confronted with or an MBA assignment for which you are seeking help.
From United Kingdom

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