Business Communication M7D1: Dealing with Difficult People

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Case Study Abhishek Goel ¡s an assistant professor of organizational behavior at the Indian Institute of Management Calcutta, in India.

The Experts

Ishan Raina, CEOof OOH Media

Eric Olson, global managing partner, Heidrick & Struggles

| g l HBR's fictionalized case studies present I H J dilemmas faced by leaders in real companies and offer solutions from experts. This one is based on the case study "Superstar Leaders," by Abhishek Goel and Nehar¡i<a Vohra (Indian Institute of Management, 2007).

The regional head of business contemplates the best way to handle the hotheaded but highly efFective leader of the India office. by Abhishek Goel

The Unmanageable Star Performer

D id you see the report from the India office?"

"I'm just opening it now," Caro- line said on the other end of the line.

Stefan Konrad and Caroline Dough- erty went way back. They had started at Leman Highlander & Company together more than 20 years before, as fresh graduates from business school. Now Stefan was the head of the consultancy's South Asia and Middle East business, and Caroline was its global human resources director. Their offices at Leman's New York headquarters were just a few doors away from each other.

Caroline continued, "The numbers look good. Three new accounts, including NMM Technology—impressive. Vijay's working his magic as usual."

"For sure—keep reading," Stefan said. He waited, and then Caroline's tone changed: "Again!"

"That's right," he said. "Turnover went up again—fourth quarter in a row. We're hitting 32%, way over the industry average. And those employee survey results are abysmal."

"He's never been one to care about the people side of things—much to my cha- grin," Caroline said.

Stefan had been worried about the Mumbai office for a while. So far it had grown faster than any of the others; busi- ness was booming. And yet every time he visited, he sensed that people weren't happy. Vijay Kumar, the managing partner in Mumbai, and Aparna Nayak, his second in command, always assured Stefan that things were fine and reminded him of their growth figures.

Leman Highlander had aggressively recruited Vijay eight years earlier to set up its operation in Mumbai. He'd been a star at McKinsey, with perfect Indian and U.S.

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credentials and a sharp business sense. Everyone agreed he was the right person to build the firm's presence in India, and two of the partners made it their mission to get him to sign on. Three years later, Vijay had more than proved his worth. The numbers coming out of Mumbai were fantastic, and big clients flocked to him. Companies had deserted McKinsey, Bain, and BCG for Vijay. The partners were thrilled. Only Caroline and Stefan seemed to have taken notice of the ongoing per- sonnel troubles.

"We need to do something," Caroline said.

"I'm going to be there next week. Let me see what's going on."

"I guess you should have a conversation with Vijay."

"I'm not sure." "You a little scared of him?" she teased. Stefan laughed. "Maybe, yes," he

admitted. "A little."

Out of the Question Stefan's suitcase was open on the bed.

"You always amaze me with how little you take," his wife, Clara, said, watching him lay two suits neatly into the carry-on. He was on the road close to 200 days of the year, so he had packing down to a science.

"Where first this time?" she asked. "Mumbai. I've got that meeting with

Vijay." "Oh, right. What did his assistant say?" "Apairna's not his assistant, honey. I told

you that." "From what you said, it sounds like he

treats everybody like one." "Yes, that may be part of the problem,"

Stefan replied. Aparna had been pretty tight-lipped on the phone. She'd said that she and Vijay were concerned about the turnover too, but it was typical for the industry right now, and Stefan shouldn't be overly worried.

"She couldn't tell you what's wrong?" "No, but she said she'd set up a meeting

with some of the consultants." That had actually been his suggestion, but Aparna hadn't resisted.

142 Harvard Business Review May aoi3

"I need to be careful," he said. "You remember what happened last time."

Two years earlier, during one of Stefan's regular visits to Mumbai, he'd asked Vijay about two consultants who had abruptly quit, claiming that Vijay was too difficult to work for. Vijay had stormed out of the office and immediately sent a resignation e-mail to Thomas Leman, the firm's managing partner. Thomas man- aged to talk Vijay down, but he gave Stefan clear orders: Going forward, he should do whatever he could to keep Vijay happy. India was now the brightest star in the region, and number two in revenue for Le- man Highlander. No one on the leadership team wanted the man responsible for that to go anywhere.

"Plus," Stefan continued, "I don't tech- nically have authority over him, because we're all equal as partners. I'd need to get approval to take any formal action."

"Like firing him?" "That's completely out of the question."

Not Everyone Is Dissatisfied As Stefan walked into the office building on Nariman Point, his phone rang. Seeing Vijay's number, he took the call.

"I wanted to welcome you," Vijay said. "Unfortunately, I won't see you until din- ner tonight. I'll be with the team at NMM all day."

Stefan couldn't say that he was disappointed.

"I hear you're checking up on me," Vijay said with a chuckle, but there was an edge to his voice.

"I'm here for the meeting with Kerimer Engineering tomorrow," Stefan replied.

•'You said having a non-Indian there would help." Then, casually, he added, "And yes, I'll talk with your staff'today. The usual skip-level."

Vijay was silent. "You still there?" Stefan asked. "Yes, you go ahead with the meeting. I

just got to NMM. I'll see you at dinner." He himg up before Stefan could say good-bye.

Aparna met Stefan at the elevator. They stopped to talk with a few people in the of-

fice, and then she led him to a conference room at the back of the floor.

"I set up a meeting at 3:00," she said. "Some of our best consultants, some new people, and some who have been around for a while."

"I'd love to hear what you think before I meet with them," he said.

"I think we're doing our best here," Aparna said. "Results are even better than before, and the pipeline is very strong. We're thought of as the premier training ground for new consultants in the indus- try. Some people complain, yes. But not everyone. Anyway, I will send the group in when it's time."

Stefan took out his laptop and looked at the office floor beyond the large glass window. Everyone seemed busy but relaxed. It was different from the previous times he'd visited, when people had been rushing around, ducking in and out of boisterous meetings in conference rooms, obviously trying to anticipate the boss's movements, moods, and demands. He realized that he'd never before been in the office when Vijay wasn't there.

"He's the Master" Stefan opened the meeting by saying,

"We're concerned at headquarters about turnover. We can't run this office without a strong team. I need to understand what we can do better."

When no one responded, he asked Amal, the most junior guy in the room, for his opinion. Amal leaned forward and told Stefan how happy he and his col- leagues were that he'd asked to see them. But then he looked around and didn't say anything else.

After a very long pause, a senior con- sultant named Rehan cleared his throat. He spoke with great deliberation: "We're all dedicated to Leman Highlander. But things have been a little difficult here." He explained that Vijay had always been a demanding boss, but Rehan and others had expected him to ease up some once the office was established. "Unfortu- nately," he said, "that hasn't happened.

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If anything, it's gotten worse. He seems impossible to please."

Then several others spoke. At first they were diplomatic, emphasizing how much they loved their jobs and the firm. But then they launched into complaints that all centered on Vijay: He was never satisfied. No one could work as hard as he did. His creative genius was intimidating. People tried to be like him, but there was only one Vijay. It felt as if he didn't trust or respect anyone but Apama and the consul- tants who worked around the clock.

"Don't get us wrong—we're learning tons from him," said a younger senior consultant. "There's no one in the whole industry who can develop and run a consulting business the way he does. He's

because she seems to be close to him," he said. "But we don't know. Maybe she is also afraid for her job. She doesn't want to upset him. And we don't blame her. He's made comments about how those who complain are just not up to the standards of the consulting industry."

Another woman spoke: "He says, 'Consulting is all about hard work. First you have to get clients, and then you have to give results.' We agree, but we can't be perfect all the time. You know, Stefan, this place is starting to get a reputation."

This was what he had feared. Not only were they losing people, but those people were bad-mouthing Leman Highlander, making it more difficult to recruit replace- ments. Vijay's reputarion had helped

The consultants launched into complaints about Vijay: He was never satisfied. No one could work as hard as he did. His creative genius was intimidating.

the master. But I'm asking myself whether working for him is costing me more than I gain. I never see my family anymore, espe- cially if I try to keep up with his hours. I'm answering e-mails at four in the morning."

"That's right," said a woman at the back of the room. "No one leaves the office if he's here, because they're afraid of retribu- tion. If he sees you leave 'early,' he's on you the next day, giving you more and more work to do."

People went on to explain that even the highest achievers felt inadequate next to Vijay, and many had left. Those who stayed wanted to be part of the success story but were confused about how to contribute. Vijay made all the decisions.

As the grievances piled up, Stefan started to sweat. This was worse than he'd thought. He tried to move the conversa- tion in a more constructive direction:

"What have you done so fiir? Has anyone spoken to him?"

Everyone looked to Rehan. "Well, several of us have spoken to Apama,

attract the best hires in the past, but now it sounded Uke a hindrance.

Growing Pains? Later that evening, Stefan foimd Apama in her office.

"Was that meeting helpful, I hope?" she asked. He wasn't sure how to answer.

"They must've said the usual," she went on, lowering her voice. "But he's brilHant as well as tough. And he's the heart and soul of this place. Without Vijay, there is no Mumbai office."

Stefan knew she was right. Vijay had built the office, and he spent every waking hour thinking about how to make it better.

"Does Vijay know how unhappy people are?" he asked.

"He's seen the employee survey results," Aparna said. "So of course he knows. But he thinks the consultants need to grow up, and he has a point. It's become a pastime here to complain about him instead of just focusing on the work. He says that if we give it time, the real complainers will leave.

our strongest consultants will remain, and new blood will come in. He thinks this is just a typical pain ofa growing organiza- tion. It will soon subside."

"That seems rather optimistic of him," Stefan said.

Aparna shrugged. "You should also know that Vijay is very sensitive about it." She told Stefan that Vijay had called her at 11:00 one night after reading the employee survey results. The firm required each of- fice to conduct ¿in annual survey, and the feedback had included several negative comments about Vijay's management style. Apjima said that Vijay had gone on a tirade about how he wasn't appreciated and there were other firms that would value his talents.

"Is he talking with other firms?" Stefan asked.

"I know he's had ofifers," she replied. Stefan pursed his lips. That wasn't

what he wanted to hear. After a moment, Apama spoke: "I

know you didn't ask for my advice, and this may be out of une, but if I were you, I wouldn't bring this up at dinner tonight. He will not like it. Focus on the cUent meeting tomorrow."

"How can I not address this? You sent me a report with some startling figures. It's my job to get answers and report back to the leadership team."

"You've got your answers already, though—right?"

Her phone rEing, and she glanced at the number.

"It looks like your car is here," she said. "Are you ready to go?"

"Actually," Stefan said, "I'm going to take a walk first. I'll be with the driver in a few minutes."

What should _ :efan say to Vijay over dinner? See commentaries on the next page.

Hay 2013 Harvard Business Review 143

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The Experts Respond Ishan Raina is the CEO of OOH Media, a leading outdoor advertising company in India, and the chairman of Ignitee Digital Services, an Indian internet marketing solutions provider.

STEFAN AND Vijay's dinner can play out in

one of three ways. The best-case scenario

is that Stefan talks honestly yet carefully

with Vijay, and Vijay gets the message and

decides to stay. That might sound far-

fetched, but it's not impossible.

Another possibility is that Vijay balks

at any hint of criticism and quits, leaving

Stefan to quickly map out a plan for retain-

ing clients and keeping revenue up. That

would be tough, but people often assume

that a star like Vijay is more important than

he really is. And it's not the worst-case

scenario.

The worst is that Stefan does noth-

ing and lets the problem fester. In three

or six months the office will be in deeper

turmoil; Vijay will be losing customers, not

just staff members; and Stefan w'ñ have to

pick up the pieces. If Stefan doesn't talk

to Vijay nov\/, he is simply postponing the

inevitable.

Ideally, Stefan could talk with Leman,

Highlander, and the other senior partners,

laying out the above scenarios and build-

ing the firm's confidence in his ability to

handle the situation and to grow a strong

organization with or without Vijay. But he

doesn't have time for that before his din-

ner, and to ignore what he's just learned

from the Mumbai team would be an op-

portunity lost. Stefan must do his job and

manage Vijay.

Of course, Stefan has to be careful. If

Vijay thinks the firm is going to constrain

his growth by putting him on a leash, he

will leave. Instead of telling him what he's

who is great for revenue but bad for your

organization? Twice when I've given honest

feedback to a star like Vijay, the person has

left to start another firm. Fortunately, how-

ever, in each case I was able to retain my

company's clients, because I went to them

and explained that although the departing

executive had been the face of his team.

It's critical that anything Stefan suggests is focused on what Vijay wants—not on what the partners or the complaining consultants expect.

doing wrong, Stefan should appeal to his

star's ego. He should start the conversation

by asking Vijay what his long-term goals

are and what he pictures himself doing in

five years. Once Vijay says that he wants to

achieve X, Y, and Z, Stefan can explain how

he'll need to change in order to reach those

goals. It's critical that anything Stefan sug-

gests is focused on what Vijay wants—not

on what the partners or the complaining

consultants expect.

I've been in this situation myself. It

happens all the time in the advertising

industry. What do you do with a highflier

WHAT WOULD YOU DO?

SOME ADVICE FROM THE HBR.ORG COMMUNITY

STEFAN SHOULD not discuss this issue at dinner; it will only end poorly and negatively impact the business in the short term. The issue should be addressed back at headquarters, with the senior partners, who can talk to Vijay once they've decided on a course of action. Gopalam Dokka, senior manager, AT&T Global Business Services India

STEFAN CAN use the dinner to hear Vijay out on his dreams for the company and himself. This will give Vijay confidence that his growth and aspirations matter to Leman High- lander and that the other partners are listening. Then, when the time comes to talk to Vijay, Stefan can link Vijay's ambitions to the need for a healthy and satisfied staff. Karthik Duraisamy, alliance marketing manager, IBM

there were very competent people behind

him who could continue to do the work.

In a third case, after I had the candid

conversation, the star decided to stay.

I was able to fix the problem and also keep

the guy. But he didn't do it for me or for

anyone else at the company. He did it for

himself.

The conversation that Stefan is about to

have is like any negotiation: If he's not will-

ing to lose, he's not going to win. But it's

a risk worth taking. If someone is likely to

ruin your organization, you need to address

the situation immediately.

VIJAY HAS the traits of a true nar- cissist and is toxic to the company. He believes that others are there to support him and that their needs are less important than his. 1 would recommend that Stefan not even stay for dinner. Vijay would most likely use the opportunity to build a false, damaging picture that makes others the problem, meaning he does not have to change. Allegra Jordan, managing director, Innovation Abbey

144 Harvard Business Review May 2013

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Eric Olson is the global managing partner of leadership consulting at Heidrici< & Struggles.

STEFAN HASN'T had a conversation with

Thomas Leman about Vijay's future, so

there are real limits to what he can say at

dinner. Unless he gets backup, he can't

confront Vijay about his leadership style as

if it were a deal breal<er.

I've been in this very situation in India

and elsewhere, in my experience, star

consultants don't suddenly become team

builders. It's clear that Vijay would rather

leave than change his behavior, and Stefan

should expect that outcome if he ap-

proaches him head-on at dinner.

The firm's partners have a decision to

make: Can they build on the existing hero-

centered business model, or do they need

something different going forward? I use

a framework developed by the company

Service Performance insight that describes

five stages of growth for any professional

services firm: heroic, functional excellence,

project excellence, portfolio excellence,

and collaborative. The Mumbai office is

clearly in the first stage, which is highly

effective for a new, small firm. But the

high attrition rate makes it potentially

unsustainable.

To ask Vijay to switch models, and run

the risk of losing him, is not a decision Ste-

fan can make on his own. In fact, Thomas

VIJAY IS not the problem. He is doing exactly what he is paid to do: bring in clients and revenue. The consultants need to adapt to his behavior. If they cannot handle a difficult boss, how are they going to handle an extremely aggressive or difficult client? Arthur Dent, chief visionary officer, MK International Management Consultants

Leman's directive two years earlier was

the opposite—to keep the star happy. If

Stefan believes that change is needed, he

has to start building that case back in New

York. A different model might be feasible,

but only if the firm can stage a compre-

hensive intervention that persuades Vijay

to adapt or if the partners can create a

Unless Stefan gets backup, he can't confront Vijay about his leadership style as if it were a deal breaker.

team capable of replacing the revenue that

would be lost should Vijay walk. Stefan

can't do either of those things without buy-

in from the other partners.

So what should Stefan say to Vijay at

dinner? He needs to focus the conversation

on Vijay's goals for the office and how to

achieve them. In india there is a strong cul-

tural bias toward competing and winning;

Stefan can appeal to this in Vijay. He can

applaud the growth they've seen so far and

then describe the profile of firms that win

over time. He might explain that those that

reach the highest stage of maturity have

lower attrition rates and higher EBIDTA,

and that he's seen other stars hit a wall

because they couldn't carry the business

beyond a certain revenue point. He can tell

Vijay that this is not what the firm wants

for him.

Instead of calling Vijay out for bad

behavior, Stefan can present a challenge.

He shouldn't ask Vijay to change, because

he won't. But he may be able to get Vijay

excited about the opportunity to expand

his considerable skills to match the next

stage ofthe office's growth. If Stefan can't

do that, he has a difficult message to take

back to headquarters. 0

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