In the Trenches: Acme's employee fraternization problem rooted in poor leadership

In this case, Acme learns about dancing on employees’ mating habits. Remember, only the names are changed to protect the innocent.

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The Acme operation under consideration here is a 100-person manufacturing plant, part of a much larger, privately held, London-based organization owned and operated by Sir Buford Nashua Conklin Acme III, one of the most socially conservative tycoons in the history of capitalistic enterprise. Sir Buford had no formal education and, deep down, was always insecure about his station in life.

Dan Saband was hired as a production engineer five years ago by Les Wallz, the director of the small manufacturing plant.

By virtue of three years of dedicated hard work and his charismatic personality, but mainly because of some fortuitous retirements, Dan found himself promoted to production manager. His duties now included production planning, equipment purchasing and generally supervising the day-shift production crew.

About a year ago, Sir Buford became so displeased with the lack of revenue from this production facility, he threatened to close the plant. Les contracted Sara Bond, a part-time, self-employed marketing consultant, hoping that Sara would be able to jump-start the sales needed to quiet the old man down a bit.

With such a small staff, it was inevitable that Dan and Sara would meet sooner or later. Meet they did, and began dating a few weeks later. A small plant is like a small town — everyone knows everyone else’s business. The buzz around the facility was that Sara was pregnant.

Les approached Dan to ask if the rumor was true. Dan told Les that Sara wasn’t pregnant. Les replied that an out-of-wedlock pregnancy would be a problem for everyone at the plant. Dan could make his assertion with a straight face because he knew that Sara had miscarried about a week earlier.

Over the course of the next couple of months, Les approached Dan and Sara several more times, complaining that their lack of discretion in their relationship was ruining the morale of the other employees. Each time, Les admonished them to be much more discreet in their relationship. Les said he feared that Sir Buford was already highly displeased — his underlying conservatism made that a certainty. Les reported that Sir Buford had already heard from suspicious neighbors complaining about the lunchtime Tai Chi lessons in the park adjacent to the plant, the prevalence of employees who commuted to work on “noisy” motorcycles, and the long-haired “hippie freaks” assigned to grounds work and building maintenance. He had already threatened to shut the plant down because of the plant’s continued marginal profitability.

Nevertheless, it was at Dan’s urging that Les hired Sara as a full-time employee, subject to a three-month trial period, to develop a new ad campaign designed to build revenue and keep Sir Buford happy. After Sara started her new assignment, she and Dan announced their engagement at the company picnic.

The tension between Dan and Les flared up again when two production workers complained about Dan’s management style and his treatment of those working under him. Quite agitated, they issued Les an ultimatum: Either Dan leaves or they leave. When Les couldn’t give them a straight answer immediately, they placed their ID cards on the desk, left the office area, emptied their lockers and walked out the door.

Les conferred with the plant’s executive team, who supported the decision to terminate Dan. When he was informed of his fate, he and Sara went to Les’s office to learn why he was being fired. Les claimed to be uncomfortable with Dan’s ability to supervise production workers effectively. Les also terminated Sara, saying they no longer needed her services. Sara then told Les that she had a miscarriage just three weeks ago and that she suffered another one the previous year.

Dan and Sara sued Acme, claiming that they’d been discriminated against because of their intimate relationship, and claimed a breach of contract and emotional distress, as well as discrimination based on an out-of-wedlock pregnancy.

How could this situation have been avoided? Should an absentee owner’s belief system have any bearing on the “morality” of some backwater operation? Does an employer have a right to control what an employee does with his personal life? Should interoffice romances be regulated by company guidelines? What is appropriate conduct in the workplace when it comes to coworkers who are dating? Is a miscarriage a pregnancy?

A corporate consultant says:

Let’s look at the real problem first, and then the obvious interpersonal relationship issue. The situation could have been avoided if Les Wallz was a better leader and manager. Les appears to be someone who chips away at the edges of a problem; much like an automotive technician who changes damaged components instead of diagnosing and repairing the cause. Because Les didn’t know how to manage organizational performance, or didn’t know where to find help to get it done, he was poking around at symptoms by hiring a marketing consultant. The buck stops with the top person. The top person must understand the business and have solid leadership and management skills to drive actions to establish and maintain high performance levels.

Dan was a production engineer for a short time and is now the production manager. It’s likely that he was lacking in either experience or knowledge in how to manage operations effectively, which resulted in poor revenue performance. Les, if he were a solid leader, would have assessed Dan’s performance and either helped him to develop, or found a more qualified production manager.

When Les hired Sara to shore up sagging sales, he did so without any apparent objective evidence that doing so would solve the problem. Hiring a marketing consultant was an insufficient action. It’s quite likely that Dan wasn’t controlling production costs, or perhaps critical production assets weren’t being maintained properly. When plant equipment isn’t maintained properly, it becomes unreliable. Unreliable equipment leads to missed deliveries and higher production costs that limit pricing flexibility.

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