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amazeBDs Succession: a case

study Course: Human Resource Management Submitted to:

Homayara l. Ahmed
Asst. Professor Institute of Business Administration University of Dhaka

Submitted by:
Group 3
Ayasha Sultana (62) Mohammmed Salman Rahman (71) Md. ShabitShafiullah (80) Makame Mahmud (89) S.M. NaimulHaque (104) BBA19th| Sec:B| IBA Date of Submission: May 22, 2012
The Case
AmazeBD is an aspiring Bangladesh based advertising agency established in 2007. The company

philosophy is to turn creativity into commercial advantage through innovative ideas that connect with consumers, wherever they are. It focuses on creating effective and memorable advertisements which build and sustain consumer relationships on behalf of brands and encompass ideas without any boundary. The founder of the company, Nayeed Alam, placed himself as the CEO of the company and his close associate Sharib Rahman as the COO. They both worked as creative directors in an advertising firm called Unitrend for 7 years. AmazeBD facilitates work by creating small creative groups comprising of 5-7 members under the creative direction of the COO or the CEO himself. Employees are recruited through newspaper and website advertisement. A 2-year experience in a creative field is a minimum for those working in the creative department. The CFO and the CMO of the company were recruited based on a 5-year experience and a Masters degree in the related field. The company is in its growth phase and has a small number of working employees. With the main office in Dhaka, AmazeBDs portfolio includes working with big shots like Unilever, Aarong, and Beximco. In 2011, AmazeBD grabbed nationwide attention for two polar opposite reasons. It became the official advertising partners of the 2011 ICC Cricket World Cup. Days of celebration were short-lived as later on that year, the highly charismatic and eccentric founder and CEO of the company met with a tragic road accident and passed away. This left AmazeBD in a state of chaos as Alams idiosyncratic leadership style and ideas were the pillars on which the companys accomplishments stood. Faced with the dilemma of how a company with so much success due to one person can remain on top as it gives the reins to a new leader, the board of directors called for a meeting to decide on a successor but opinions were divided. Half of the board felt that Sharib Rahman, COO of AmazeBD and an adjunct to Alam from the very start of the business, should be the new CEO. Others wanted to undertake external recruiting so that this vital position was filled by someone with a proven track record. Inability to reach consensus forced the neutral head of HR to consult with Excel, a successful executive recruitment agency. On close examination of the situation, Excel found out that Alam and Rahman had forged a strong partnership which led the company to its current stature. Rahman received executive mentoring from the CEO himself. Often on Alams orders, Rahman performed many of the job assignments of the CEO. Besides, whenever Alam was abroad, Rahman took care of the business but it was never for a long period of time. Thus, Rahman was groomed under an informal succession plan designed by the CEO to assume the topmost managerial position. Excel deemed Rahman to be a potential candidate. However, it also created clear windows through which both internal and external candidates can be considered in parallel since effectiveness of the CEO succession process depended to a large extent on its transparency. The first step involved in-depth discussions with key members of the organization to arrive at an accurate definition of the CEOs profile. Excel then generated a pool of suitable candidates and shortlisted the following for consideration: Shehnaz Hossain: Shehnaz was a veteran marketing practitioner with over 13 years of marketing agency experience working across a number of brands and a variety of sectors from automotive to retail to travel and soft drinks. She was the CEO of Interspeed, a renowned Bangladeshi ad agency; however recent family prioritizations brought about rumors of her passing the torch. Reaz Ahmed: Reaz was one of the former creative directors at UK based creative agency Fallon which had companies like Sony, Cadburys, and Unilever under its clientele. He had just settled in Bangladesh and was for the time being unemployed. Excel also pointed out to AmazeBD that it did not have a contingency plan in place which will ensure continuous supply of competent managers should a void be created in the organizational lineup a practice that is crucial to any successful companys sustainability. With a major project coming up, it was go-time for AmazeBD. The void left behind by the enigmatic CEO needed to be replaced by his successor. As an active participant of the board, the HR manager had to address the problems identified by Excel and most importantly, evaluate the alternative recruitments and decide on the CEO succession.

Learning Objectives (LO)

1: To learn about the recruitment process in terms of the different methods employed, its strategic LO role in the organizational process, and scheme of evaluation, etc. 2: To understand the importance of succession planning as a crucial dimension of the recruitment LO process and evaluate its implications on an organization

Questions and Answers

1. a. What is the existing process of recruitment like, in AmazeBD?

b. If you were the Head of HR for AmazeBD, will you choose the internal recruit as the CEO or pick from the shortlisted external pool? Justify your stance with proper rationale. a) AmazeBD is a middle-of-the-road advertising firm in its growth phase. The founder of the company, Nayeed Alam, himself is the CEO of the company with a 7-year experience in a similar field. His colleague from the previous workplace, Sharib Rahman, was made the COO of the company with a similar experience. No recruitment methods were required for these two posts. The other posts were filled up by personnel recruited through newspapers and website advertisements. The pool for the CFO and CMO were generated based on a past 5-year experience in a related field and a Masters degree. The creative posts were filled up by people with 2-year experience in a creative field. AmazeBDs attracting of candidates through newspaper and online advertisements have both advantages and disadvantages. Firstly, this recruitment process would provide a high volume of responses and thus a lengthy and costly selection process. Secondly, attracting of candidates online might result in interested candidates living abroad who might not be able to attend the interviewing in time and might also be not interested to relocate at his own cost once selected. Thirdly, the expertise of a recruitment consultant or reference recruitment has been found to be more effective in cases of topofthepyramid positions. b) The difficulty that was faced due to the sudden death of the CEO of AmazeBD, Nayeed Alam, can solely be contributed to the absence of a formal succession plan. Alams able leadership and eccentric ideas were the reasons behind the companys fast growth. Therefore, there are vast challenges waiting for the to-be-hired CEO. Whoever the new CEO is will have to live up to the benchmark set by the former CEO Alam. To determine whether external recruiting or the internal recruiting would be better for the position of CEO, the company requires a what-if analysis. The internal recruitment in this case is to make the COO of the company, Sharib Rahman, the new CEO. To the company Mr. Sharib Rahman is a man of known ability. He has already served as the COO of the company and has been with the company since its inception. This involves less presumption of his suitability for the position of CEO. It would also motivate the other employees who are looking forward to a promotion based on their performance and loyalty, and consequently enhance job security. Promoting from within will also save recruitment costs and orientation time. In addition to that, Rahman worked as a right hand to Alam from the very first and is quite familiar with the way Alam administered the company. Rahman is also acquainted with the organization culture which is an advantage. If Rahman is made the new CEO AmazeBD is going to face a ripple effect because as a consequence to the event, a vacancy will be created in the position of COO and the company has to undertake external recruiting anyway. Most of the employee below the COO level are not experienced enough to be promoted. Excel has recommended two candidates for the position of the CEO, Shehnaz Hossain and Reaz Ahmed. Both of them have good enough experience to take the position. Since it will be an external recruitment, if any of them is selected, the individual might bring in new ideas and viewpoints. The individual will be subjective enough to bring about necessary changes as he does not have any prior commitment to any of the existing subordinates. There are a number of challenges that the HR Head will have to address in order to undertake external executive recruitment. A person who is as experienced as Shehnaz Hossain or Reaz Ahmed might have ego issues. AmazeBD itself is not a top notch company. So, the pool suggested by Excel might find it offensive to be interviewed when they have so much in their resume. Eventually they might not live up to the apparent high potential displayed. The process will also be costlier than internal recruiting. A top position of a company needs someone who is acquainted with the company culture and does not need time to norm with the atmosphere. External recruitment will not serve the purpose. It will also discourage the current employees as it will reduce their chances of being promoted. The headhunted top names have problems of their own. Shehnaz, though she is a veteran, her considering retirement could significantly hamper the flow of this dynamic company even if she chooses the job. After 13 years of experience, she might think she has had enough. Her point of view of the marketing industry in Bangladesh could also be in contradiction with the company. Reaz has another problem altogether. Even though he has an impressive CV, he has to have a proven track record in Bangladesh. The marketing scenario can be significantly hard and an advertisement needs to be culturally, aesthetically significant to make an impact in Bangladeshi society. Considering the above what-if analysis, it can be suggested that it will be more feasible and beneficial

for the company to carry out internal recruitment. It will require less cost, motivate the current employees, save training and development time and retain the organization culture and Mr. Alams idiosyncratic way of administering AmazeBD which had been the pillar of its success so far. 2. Is the informal succession plan in place sufficient for such a company? If not, what changes need to be introduced? From recruiting the right candidate to developing new leadership from within, succession planning is vital for an organization to meet its strategic goals. It is an ongoing process that helps an organization to align its business goals and its human capital needs so that it can strive in its dynamic operating environment. For a flourishing advertising agency like AmazeBD, whose success depends upon the honing of creative minds, cultivating enough talent is a practice of utmost importance to sustain current business models or innovate for growth. Here lies the dire need of an effective succession plan for AmazeBD. An ideal succession plan addresses the needs of the organization as senior management ages, helps it to prepare for an unexpected event and ensures that it has the right personnel to function at peak efficiency. AmazeBDs succession plan is far from being ideal and requires drastic amendments. The CEO of AmazeBD, Nayeed Alam, created an informal succession plan for his successor and the COO Sharib Rahman. Alam engaged Rahman in a development program of sorts where Rahman was mentored by the CEO himself, given job assignments traditionally conducted by the CEO and made to serve the CEO role quite a few times. This surely did season Rahman to assume the highest executive position but there was no way to assess whether his competencies were fit. Moreover simply based on Alams perception of Rahmans competencies, he was declared the successor. The company, by not conducting a talent review, therefore missed out on identifying any high-potential employees. The succession plan was also conducted in a vacuum not allowing management to actively participate in. The credibility of the plan was questionable and the management was unclear about the companys talent philosophy. The management hence did not have a very clear approach and solid, aligned internal systems that make it clear how to get promoted and who gets the most heavily recruited. For this very reason, the sudden departure of the CEO created a rift between the board of directors as they considered internal vs. external recruitment for succession despite having a succession plan which supposedly was made to ensure a smooth transition that would maintain the stakeholders confidence. AmazeBD turned to the recruitment agency Excel and a CEO profile was formulated so that a pool of internal and external candidates can be generated. Although these are the initial steps of a common succession plan, AmazeBD turned to these practices only after a vacancy was created negating the concept of a succession plan. Moreover the company did not have succession plans for any position in the organizational hierarchy other than the CEO. This would definitely create a ripple effect if Rahman is promoted to the CEO position. AmazeBD, one of the leading progenitors of creativity in Bangladesh, have to restructure its succession plan and introduce the following changes to sustain its growth spurt: Analysis: AmazeBD needs to estimate the challenges that the industry might face, and the skills and experiences needed by the CEO and other employees to overcome them. The company also needs to have an idea of its supply chain an estimate of talent depth and availability as well as the companys ability to attract them. Thus succession plans play an important part in the recruitment process as well. The positions to be included in the succession plan also need to be identified. Usually the key positions are considered. Development: AmazeBD has to develop the following for the succession plan to work properly: Congruence of the succession plan with the companys strategic goals and objectives Standard benchmarks to evaluate the positions required competencies, skills, experiences, knowledge, etc Talent review methods to measure the potential of employees Pool of internal and external candidates to choose successor from Training and individual developmental programs By carrying out job analysis and job evaluation, profiles of each position should be created. High potential employees can be identified through talent reviews and then engaged in a developmental program which might include assignments like handling of an important media client, being mentored by the companys creative directors. AmazeBD can identify external candidates by working together with Excel. Selection: AmazeBD should set its talent philosophy in place. Since it is a creative advertising agency and the company culture created by the highly dynamic CEO Nayeed Alam is one of the main reasons

behind its success, the company should give more priority to internal candidates. The final assessment method should be agreed upon by the entire management and will include: In-depth competency focused interviews - which will test for the skills and talents essential for the role 360 referencing - that provides insight from superiors, industry peers, colleagues and direct performance reports Only when internal candidates will not fulfill the selection criteria, external recruitments would be made. Succession planning is a long term process and AmazeBD needs to be persistent in its use. Feedback from the assessment process should be communicated to the employees so that they can identify the missing skills and competencies, and AmazeBD should also develop training programs to address this lacking. Succession planning creates career paths and ensures smooth transitions, and this will definitely help AmazeBD since it can concentrate on what it does best being a relentless creativist.

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