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Case Analysis

Can Culture be too strong?


WAC
Section C, Group 3
Abhishek Kumar
Aditya Nagrare
Diksha Agarwal
Manjunath Holin
Praneet Singh
S Madhurakshara
Srijith Prakash

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Letter of Transmittal

Dear Ms. Chatterjee,


We have enclosed the analysis of the case Can Culture be too strong?
The findings of the case are as below:
Culture cannot be forced on the employees. It should be fair in
implementation
People Support Function should be implemented & broader environment
of caring and attentiveness should be focussed on
The company wasnt doing a good job in case meeting its employee
needs
This case has enabled us to gain knowledge about the culture followed in IT
companies. It is a challenging task to follow the culture. We could clearly find
the difference of opinions in various employees.

Finally this case helped us get familiarized with real world experiences faced in
certain companies. This could help us in making strategic decisions and would
be valuable for us in the future
Regards,
Group 3
Section C

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Executive Summary
Parivar, a mid-size Chennai based IT service company led by the CEO, Sudhir Gupta, has
evolved from bankruptcy into an industry success story. The company operates in second tier
cities and is making its leeway into first tier cities. In this expansion of operations the
company faces a turnover rate of 35%.
The company seeks a change in order to counter the growing attrition. In tries to identify the
drivers behind this with the help of information collected from the exit interviews of the
relieved employees.
The information collected reveals the formation of an in-group, or Big Brotherly Love,
around the CEO that restricts the family-like attention with rest of the employees. Also, a
power difference has arisen which keeps the employees away from discussing their
grievances with Sudhir.
Other side of the coin reveals the slowdown of Indian labour market as the main reason
behind the huge turnover. This is a part of the issue but the inherent conditions that have led
to this number still exits and a change is required.
Nisha, a fresh MBA graduate, comes up with an expensive program proposition, People
Support during the Future Vision exercise. Under this program, the managers attend to
grievances of the employees and work out a possible solution in the best interests of both
employees and the organization.
Sudhir claims that this program will lead to a formation of a love-culture with attentiveness to
both personal and professional lives which will eventually lead to lessened attrition rate. Will
this strategy solve the problems faced by the company or the problem lies somewhere else?
What should be the HR policies to lower the attrition rate?
In this report, we analyse if the People Support will give the company the required results.
We recommend the methodologies about how the problem should be handled, suggest best
option among the various alternatives and devise an implementation plan.

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Table of Contents
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Table name
Introduction
Problem Statement
Analysis
Conclusions
Recommendations
Implementations
List of References

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1. Introduction
Parivar, a mid-sized Chennai based IT Services Companyhad been saved from bankruptcy by
its charismatic CEO, Sudhir Gupta. He had tripled revenues and quintupled profits with
culture at the centre. Parivar was rapidly growing under Sudhir and was aiming to step up
from second tier to first tier status. Recently this business enterprise had hit with a problem of
high turnover rate of 35% and Parivars HR head, Indira Panditwas faced with a dilemma.
The management was considering the adoption of a personnel management innovation,
referred to as People Support, involving a group of managers whose role was to listen to and
help employees work related problems. Indira has her own apprehensions of this idea
presented by the Future Visions Team on whether Parivar would be able to expand and
progress with this cultural philosophy.

2. Problem Statement
To analyze whether endorsing People Support functions as a culture would ensure global
expansion of Parivar and bring turnover rate under check.

3. Analysis
Criteria:
Parivar had seen a turnover rate of 35% and were losing people faster than the
recruitment team could bring in. Around 100 employees had given notice in the recent weeks,
reasons for which were not clear to Indira, HR head. Increased turnover rate will have an
adverse effect on the operational efficiency and affect the overall business performance. It
would also increase the recruitment and training costs. In an IT service company, customer
relationship is of utmost importance. Changing personnel allocated to clients can hamper
customer relationship and loss of faith which in turn will cripple business. Therefore
reduction in employee turnover rate is a critical issue that needs to be addressed urgently.
Parivars CEO Sudhir had brought the company from the brink of bankruptcy to success
with a cultural philosophy of love culture. At Parivar, a feeling of family was propagated
among the employees and attention was given to both personal and professional life. Exit
interviews held by Indira provided some insight into employee expectation from Parivar.
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Employees preferred a greater pay over family like treatment which was the reason why the
opted for Wipro and other competitors who offered 30% pay rise. Resonance between
employee expectation and top management ideas was essential.
The company had a mission of stepping up from the second to the first tier. It was on a
path of global expansion and human resource management was of utmost importance to
maintain a competitive edge in the industry.
Sudhirs support had given a great impetus to innovation which was a hallmark of
Parivars inclusive culture. The Future Visions Team had come up with People
Supportfunction which was committed to culture of caring.
Evaluation of options
In order to ensure the expansion of the company, control employee turnover rate and to
increase employee satisfaction the following options have been evaluated.
1. Go ahead with proposed People Support Function: This philosophy will help Parivar
retain only those employees whose needs are in resonance with the provisions of the
company. This would result in high turnover rate as people who assign higher value to
monetary benefit will leave for better options. Moreover a change needs to be brought
about in the recruitment process which will ensure selection of employees who are
culturally aligned with the organization. Over time the turnover rate would stabilize as
the recruitment and training would support the culture of the organization and ensure
smooth global expansion of Parivar.
2. Give better compensation and benefits to its employees: This would be an immediate
remedy to the turnover rate problem. It will help retain employees who prefer
monetary benefit. It might result in reduced profits. This method will fail to reap
benefits in future as competitors can lure employees by offering even better monetary
packages. Its Love Culture philosophy would definitely undergo some changes and
thereby Parivar would lose its competitive and differentiating factor. The effectiveness
of the system can be checked by calculating the employee turnover.
3. Accept that its because of growing industry demand and do not change: Attribute the
high turnover rate to fusion of innovation across industry and maintain status quo.
This would be a risk-averse option. Status quo might result in certain drastic steps in
future if the situation goes out of hand. IT industry is very volatile and fast growing;
Parivar would be eliminated from the competition if it fails to adjust itself to changing
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times. . Their reputation as a good employer will drop and they will find it very hard
to find good employees. Also their training and hiring costs will increase and this will
lead to drop in profitability. This option is thus, not at all viable.
4. Change family like organizational culture so as to give more personal space to
employees and not let them have a feeling of over-involvement. Differentiating
among employees as to those who prefer involvement over those who dont would
pose a tremendous challenge. Exit interviews stated high pay to be the key reason for
attrition followed by preferential treatment to certain recruits. Impact on turnover rate
would be marginal with this philosophy.
5. Mix of better compensation to employees and employee support function: this could
be a viable option if implemented in an appropriate manner. Analyzing the industry
standards of pay, providing sufficient rise and compensation facilities coupled with
Love Culture would enable Parivar to maintain its position as best employer and also
reduce turnover rate. Employee satisfaction would receive a boost because of the
monetary and emotional support. Parivar would have highly productive work force
thereby increasing its competitive edge and supporting its global expansionist ideas.

4. Conclusions
The employees of the company are generally more inclined towards the monetary benefits
rather than the prevalent Culture in the organisation. Thus, the company should provide better
compensation to the employees and at the same time nurture the family like culture of
Parivar.

5. Recommendations
The company should go ahead with a mix of better compensation to employees and at the
same time implement employee support function in order to nurture the family like culture.

6. Implementation
Firstly, Parivar must understand the needs of the employees. This can be done by excessive
focus on exit interviews, better feedback systems and deeper analysis of the present system.
Keeping in view the recommendations provided, the implementation could start right from
the top management. For a growing organisation like Parivar, it becomes difficult for the top
management, especially CEO, to interact with all the employees of the company. This leads
to selective biasing and some employees sense the presence of in-groups within the
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organisation. This has been one of the main problems of the company and it can be solved by
employing Listeners who are the employees of Parivar. These listeners could be line
managers or HR managers who can understand the needs or problems of the employees and
cater to them whenever necessary. The listener could act as a source of motivation for the
employee as well as inducing the culture of the organisation. This should be done in an open
environment without any bias so that it would make the employee feel more comfortable, and
eventually contribute to the growth of the organisation. To put this into action, the managers
should be given training on human aspects and this can be put into implementation by
availing these listeners to interact informally on a weekly basis to find out about their
grievances. Moreover, we recommend monthly team activities, including team outing, event
participations like marathon to build upon the open and family like culture of the
organization.
On the other hand, employees look for better salary and other benefits. This factor is
responsible for the higher attrition rate in the organisation as higher salary elsewhere would
lead to employees leaving the current organisation. A well paid employee could be more
dedicated towards his work and would have a higher sense of commitment. This problem can
be tackled by increasing the salary by 10-15% which would lower the difference between the
company and industry standards of 30% higher salary. The budget of People Support can be
used for this purpose.
In all, these plans should be carried out simultaneously in different departments.

7. List of references

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1. https://hbr.org/2014/01/can-a-strong-culture-be-too-strong

2.

HBR.ORG

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