Reference no: EM132822356

Iceberg Effect and Cliquism in Trendsetters ABC Limited: 

The iceberg effect in organizations are the underlying factors and circumstances which are not visible and have organizational implications due to strong under currents. When combined with cliquism, it can undermine an organization or a community. This is a challenge faced around the world in different forms and leads to corporate disasters. In Pakistan due to cultural nuances it has even greater consequences.  

Trendsetters ABC Limited was a start up with a progressive vision and financially resourceful BOD who wanted to emerge as a market leader within the shortest possible timeframe. The initial core team comprised primarily of young, competent females and an aggressive Chief Executive Officer who believed in achieving the impossible and driving the whole team forward. However, there was a strong disconnect between the core team and the functional team of Trendsetters Limited and therefore after a year of operations, the BOD decided to hire an experienced Chief Operating Officer to manage the operations of the organization. 

Through a comprehensive selection process, they identified and selected Zaheer Ahmed as the new Chief Operating Officer of Trendsetters Limited. Zaheer came with strong credentials of being a mover and shaker, starting organizations from scratch and building teams towards high performance. He believed in hands on leadership and setting achievable targets, so that the rest of the team would emulate and move forward . The BOD while hiring Zaheer Ahmed assured him of full independence and directed the CEO Anjum Rana to play a strategic role in Trendsetters, while giving her a few other tasks to accomplish for the Corporate Group.  

Within a few weeks of joining Trendsetters, Zaheer realized that there were strong negative undercurrents within the organization and invisible turf disputes between the key managers. This situation was exacerbated with the visible animosity of CEO Anjum Rana, because she considered Zaheer Ahmed to be an unnecessary addition to Trendsetters and an encroachment on her authority and independence.  

Zaheer Ahmed with over 25 years of practical experience and facing similar situations, immediately initiated team building exercises and forging the two disparate groups within Trendsetters . He even conducted a detailed meeting with Anjum and expressed his commitment to work under her supervison and accommodate all her merit oriented and judicious demands and directives. He reiterated that all his communication to key managers would be routed to Anjum for taking her input in different organizational matters. He initiated empowering the chief officers team of Trendsetters so that operations could expand as per the guidelines of the BOD and enhanced the authority of the chief officers so that they could take independent decisions. This approach was not endorsed by Anjum and her clique of 3 senior managers. It seemed as if authority was being taken from them and they were not wielding the organizational wand of power. Despite repeated endeavours, Zaheer Ahmed could not break the ice. The clique under the leadership of Anjum Rana began a clandestine process of underming Zaheer and jeopardizing all the initiatives rolled out to take Trendsetters to the next level.  

The 3 senior managers stopped reporting to Zaheer Ahmed and would directly report to Anjum Rana , they would delay task completion with the excuse that they were executing a task given by Anjum Rana, they would not follow organizational regulations on the pretext that Anjum had exempted them from such procedures etc. Anjum Rana on the other hand kept on breaking the chain of command and directly without intimation to Zaheer, gave directions to the functional tiers, which resulted in confusion and non-compliance.  

Zaheer after many attempts to placate Anjum , discussed the issue with the BOD and he was given assurances that this situation would be managed and Anjum would abstain from interference. However, due to the strong relationship between Anjum and the Chairman of Trendsetters, the status quo continued and the affairs of the organization deteriorated. The Clique left no stone unturned to undermine and jeopardize the working of Zaheer Ahmed . They intentionally delayed the critical hiring of new employees and also started compromising the activities of the other senior staff. This created immense demotivation in the remaining senior staff and Zaheer again went to the Board for intervening in the issue or to accept his resignation. For some time , things improved because the BOD realized the implications and gave direct command and executive authority to Zaheer. This further aggravated the temperament of Anjum. She along with her 3 senior managers hatched a conspiracy whereby one of the senior managers falsely implicated that Zaheer Ahmed had sexually harassed her . This erupted into a major controversy and after a sequence of events, Zaheer Ahmed left the organization. In disgust, 4 other senior managers who were not from the Anjum Clique , also resigned.  

Zaheer had to go through cumbersome legal procedures, struggling for his honour and integrity. Finally, after many months it was established that there was no incidence of sexual harassment and neither was there any other administrative issue-it was just organizational politics. Trendsetters ABC Limited with a vision to be a market leader had drastically fallen below its previous levels of performance and productivity. Anjum Rana and her clique also left the organization. Trendsetters BOD got shuffled and is aspiring to revive Trendsetters as a progressive organization.  

Discussion questions for students: 

• Identify the main behavioural issues related to the Trendsetters Limited Case study?
• Why was Anjum Rana insecure? How could the BOD alleviate the insecurity of Anjum Rana? What should the BOD have implemented to avoid this situation?
• What should Zaheer Ahmed have done differently, to manage this iceberg effect and Cliquism. What were the remedies in this situation?
• Which behavioural models can be applied to this case study?
• Identify the unethical issues prevalent in Trendsetters Limited?
• What are the lessons learnt from this case study? How should managers neutralize the iceberg effect in any organization?
• What should the BOD of Trendsetters decide for the future growth of the organization?