Name: Darpan Choudhary

Roll no. PGPGC202100112

Section: B
Morgan Stanley : Becoming a “One-Firm Firm”
Challenges of Groupism
Firms dependent on the individual capabilities of the employees for creating value for their
clients eventually encounter difficulties with the cross-functioning of different departments
within the firm. The situation resulting from the failure of inter-departmental functioning and
communication leads to the formation of segregated groups. Such developments are anticipated
in firms where value creation is not employee-centric due to the human nature of social groups
predisposing to include or exclude instinctively.

The problem then adversely affects the organisation in a multitude of channels.

● Loss of talent - Due to the unhealthy environment, especially for newcomers, career
growth is stifled in the neverending battle of "us vs them"
● Productivity Downfall - The toxic environment and the inter-departmental conflicts
lead to a detrimental impact on the employees' mental health and consequently
diminishing productivity.
● Scaling Issues - Individual-centric value addition is viable for boutique organisations
looking for rapid growth; scalability becomes considerably strenuous when this
philosophy is at the core of the business.

Framework application
The primary framework employed for the analysis of the case was
Ability-Motivation-Opportunity(AMO). The framework mentioned can explain the intricacies of
employee characteristics and their performance. According to AMO, growing abilities,
improving morale and providing ample opportunity for the employees was essential for the
rebuilding process of Morgan Stanley. Another important tool was the High-Performance Work
Systems which refers to HR policies and practices that foster high performance from employees.
In Morgan Stanley, John Mack hired an OB specialist to revamp the HR policies to nurture a
high-performance work environment through company-wide collaboration.
In brief, the key learnings were:
● To create a positive environment for growth and collaboration.
● Institute formal appraisal system for continuous improvement and other retention
systems for preserving talent.

Solutions
Creating a sustainable working environment while ensuring rapid growth for the organisation
and employees is impossible without considering the sentiments of the employees. The
personnel should be able to align their aspirations and emotions with the vision of the firm.
However, there are drawbacks to this approach as it can lead to formation of disergy due to
differences in abilities.