2
A Worried CEO
Sudarshan, the Managing Director of M. Feeds, a Bangalore- based company, is a worried man. All his
efforts to regain the lost market and to wipe out red in the company’s balance sheet have proved futile.
Sitting alone in his chamber, lighting up cigarette after cigarette and sipping cups of coffee, Sudarshan
started recollecting events of 1987 which wrecked the fortunes of a once successful company.
Subbu and his team got defeated in the union election held in beginning of 1987. Rivals,Gowda and his
team, got elected with comfortable majority. The winning team had a leaning towards CITU, which was
known for its militancy. The attitudes and actions of Gowda and his team were not to the liking of the
management, particularly Setty, the Factory Manager. The management was waiting for a way out to deal
with the new team of unionists. Not reconciled to the loss of power, Subbu and his cronies started a
cultural association with an apparent objective of promoting Kannada, the local language. Setty welcomed
the formation of the association and, in fact, even encouraged its activities. The management too gave
financial support to the cultural outfit. Emboldened by the encouragement given, Subbu and his team
demanded that the management should negotiate with them about all matters relating to employee
welfare. This proposal was not acceptable to the management which turned it down. But Setty began
hobnobbing with Subbu often to the consternation of the leaders of the recognized union.
One day Gowda and Subbu had a heated exchange of words which resulted in physical bout inside the
plant. Sridhar, HRD Manager, placed the duo under suspension on grounds of indiscipline. Enquiry was
conducted in which Subbu was acquitted. But Gowda refused to appear before the enquiry officer. Having
been acquitted, Subbu demanded reinstatement, which the management readily agreed. Subbu, with
triumph writ large on his face, came to factory but the team led by Gowda protested by calling a strike.
Them management assured Gowda that he too would be reinstated provided he was acquitted by the
enquiry officer. Gowda was in no mood to listen to the management nor was he prepared to face the
enquiry. Subbu demanded reinstatement which Gowda protested. The stalemate continued and the strike
lasted three months. Work resumed after prolonged talks. But the scars remained. Setty got a sack and
Sridhar left and joined an Indo-French company. M. Feeds lost its customers and the efforts (setting up,
for the first time, a marketing department) to regain their patronage did not succeed. The bottom line
became red and it grew thicker as years went by.
Questions:-
1. What should Sudarshan do?
From United States, Cambridge
Sudarshan, the Managing Director of M. Feeds, a Bangalore- based company, is a worried man. All his
efforts to regain the lost market and to wipe out red in the company’s balance sheet have proved futile.
Sitting alone in his chamber, lighting up cigarette after cigarette and sipping cups of coffee, Sudarshan
started recollecting events of 1987 which wrecked the fortunes of a once successful company.
Subbu and his team got defeated in the union election held in beginning of 1987. Rivals,Gowda and his
team, got elected with comfortable majority. The winning team had a leaning towards CITU, which was
known for its militancy. The attitudes and actions of Gowda and his team were not to the liking of the
management, particularly Setty, the Factory Manager. The management was waiting for a way out to deal
with the new team of unionists. Not reconciled to the loss of power, Subbu and his cronies started a
cultural association with an apparent objective of promoting Kannada, the local language. Setty welcomed
the formation of the association and, in fact, even encouraged its activities. The management too gave
financial support to the cultural outfit. Emboldened by the encouragement given, Subbu and his team
demanded that the management should negotiate with them about all matters relating to employee
welfare. This proposal was not acceptable to the management which turned it down. But Setty began
hobnobbing with Subbu often to the consternation of the leaders of the recognized union.
One day Gowda and Subbu had a heated exchange of words which resulted in physical bout inside the
plant. Sridhar, HRD Manager, placed the duo under suspension on grounds of indiscipline. Enquiry was
conducted in which Subbu was acquitted. But Gowda refused to appear before the enquiry officer. Having
been acquitted, Subbu demanded reinstatement, which the management readily agreed. Subbu, with
triumph writ large on his face, came to factory but the team led by Gowda protested by calling a strike.
Them management assured Gowda that he too would be reinstated provided he was acquitted by the
enquiry officer. Gowda was in no mood to listen to the management nor was he prepared to face the
enquiry. Subbu demanded reinstatement which Gowda protested. The stalemate continued and the strike
lasted three months. Work resumed after prolonged talks. But the scars remained. Setty got a sack and
Sridhar left and joined an Indo-French company. M. Feeds lost its customers and the efforts (setting up,
for the first time, a marketing department) to regain their patronage did not succeed. The bottom line
became red and it grew thicker as years went by.
Questions:-
1. What should Sudarshan do?
From United States, Cambridge
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