Case Study
Please read the case given below and answer the questions
given at the end.

One afternoon in June 1972, Rao, industrial engineer of
P.M.A. company, was called to the office of his immediate
superior V.R. Naik, the production manager. Naik
said, “Rao, I want to discuss a situation in the production
department. A lot of people feel that Govindan is not the
right man for the Assistant Superintendent’s position. The
President and others have decided that I have got to fire
Govindan or at least move him out of production. Everyone
wants to fire Govindan, but I won’t do it to him. I was
talking with Bhadra this morning, and we decided that you
might be able to make use of Govindan in your department.”

Rao was surprised by both the information, and the proposal.

Naik concluded his comments with, “Rao, I am asking you to
take Govindan. You can say ‘No’. But then he gets fired. I
have told Govindan this. Also, Govindan knows that if he
goes with you he will take a pay cut. However, I think you
can make use of him both to your own and his satisfaction.
You are, anyway, carrying out an in-process quality
control, and you might be able to make good use of Govindan
in view of his long technical experience of production
work. Think it over, and let me know by tomorrow.”

Rao thought over the matter.

PMA company had been a successful enterprise until March
1972 at which time it suffered a sharp decline of profits :
sales had fallen off, and production costs had risen. The
President adopted three measures which he hoped would
improve the condition. First, by creating an Industrial
Engineering Department for establishing work standards on
all production operations, to determine which manufacturing
costs were out of line and where remedial action should be
taken. Rao, 28 years old, who had been with the company for
two years in the Purchasing department, was selected. Rao
had B.E. and MBA degrees to his credit. What he lacked in
his business experience he made up by his eagerness to
learn. He was ambitious and liked by his associates. He
wanted a transfer from Purchasing to Production for better
opportunities for advancement.

Secondly, he consulted a Management Consultation firm to
make a study of the Production Department. They pointed out
that the chain of command was too long from Production
Manager through Plant Superintendent through Assistant
Superintendent to Foremen. They recommended the elimination
of the position of Assistant Superintendent.

Thirdly, he engaged an Industrial Psychologist to
appraise all the Supervisory Personnel.

Govindan had been with the company for 20 years
since its founding and during this period had worked on
every production operation, and his last 11 years had been
in supervisory capacity. His manners were rough and
aggressive, he had little formal education. The industrial
Psychologist’s report about Govindan contained the
following points:

(i) Evaluation for the position of Assistant
Superintendent : Not good enough.
(ii) Capacity for good human relations in supervision :
Will have friction frequently.
(iii) Need for development counseling: Counseling greatly
needed.
(iv) General evaluation: Govindan had a good ability
profile. He suffers from a sense of inferiority. He does
not like the responsibility of making decisions. His
supervision is that of Autocratic type. Though he has the
ability, as far as his personality make-up is concerned, he
is out of place in the present position.

Questions:
1. What is the problem in the case? Explain.
2. Explain Govindan’s behavior and work experience vis-à-
vis the psychologist’s report.
3. How do you see Naik’s suggestion to Rao? Give reasons.
4. What are Rao’s considerations in taking a decision? What
should he do? Explain.