Jack Nelsons Problem

As a new member of the board of directors for a local bank, Jack Nelson was being
introduced to all the employees in the home office. When he was introduced to Ruth Johnson, he
was curious about her work and asked her what the machine she was using did. Johnson replied
that she really did not know what the machine was called or what it did. She explained that she
had only been working there for 2 months. However, she did know precisely how to operate the
machine. According to her supervisor, she was an excellent employee.
At one of the branch offices, the supervisor in charge spoke to Nelson confidentially, telling
him that something was wrong, but she didnt know what. For one thing, she explained,
employee turnover was too high, and no sooner had one employee been up on the job than
another one resigned. With customers to see and loans to be made, she continued, she had little
time to work with the new employees as they came and went.
All branch supervisors hired their own employees without communication with the home
office or other branches. When an opening developed, the supervisor tried to find a suitable
employee to replace the worker who had quit.
After touring the 22 branches and finding similar problems in many of them, Nelson
wondered what the home office should do or what action he should take. The banking firm
generally was regarded as being a well-run institution that had grown from 27 to 191 employees
during the past 8 years. The more he thought about the matter, the more puzzled Nelson became.
He couldnt quite put his finger on the problem, and he didnt know whether to report his
findings to the president.
Questions:
1. What do you think is causing some of the problems in the banks home office and
branches?
Since employee turnover is high, there definitely has to be a problem in the employees
dissatisfaction with their work. The reasons for this dissatisfaction can range from a low salary to
a bad work environment. Furthermore, In one of the branch offices, the supervisor stated that
with customers to see and loans to be made, she had little time to work with the new employees
as they came and went. This means that training is inadequate, and the employees are less
equipped with the knowledge and expertise needed to be successful, which can lead to poor
performance. Since the employees seem to have the skills needed (Johnson precisely knew how
to operate the machine, but did not know the name of machine), the problem here comes from
the administrations inability to help train the employees - not so much the employees lack of
human capital.
2. Do you think setting up an HR unit in the main office would help?
Setting up an HR unit in the main office would definitely help. First of all, it can create a
company-wide set of standards for employees that would fulfill the needs of the firm. In the
passage, it was stated that employees are hired without communication with the home office or
other branches. This means that the lacks a universal definition of what is required from an
employee - this disorganization is detrimental to the company as a whole. With an HR unit
standardizing the job description and the qualifications needed from an employee, it could find
better candidates, thus lowering the turnover rate. The passage also states that supervisors did not

have time to work with new employees, and they mainly focused on replacing workers who quit.
Having the HR unit could also help retain the employees, and it would work to be that support
system that would give the employees the attention they need.
3. What specific functions should an HR unit carry out? What HR functions would then be
carried out by supervisors and other line managers? What role should the internet play in
the new HR organization?
The HR unit could be in charge of recruiting and lead the initial screening process. It
could screen through the resumes and even phone interviews. By upholding a standardized set of
required qualifications, it could weed out the employees that would not be a good fit for the
company. The candidates that make the first cut would then be given to the supervisors and line
managers to choose from through a second-round interview. This helps the supervisors because
they seem to be very busy (judging from the passage), and it would be more time-efficient with a
smaller pool of candidates to choose from. Another specific function the HR unit can carry out is
a well-organized training procedure or orientation, that works to inform the newly hired
employees of company knowledge and insight of the company from a bigger picture. After the
training, lines managers can then fill the employees in on their specific roles. Here, the training
serves to set a strong foundation for the needed expertise.
In terms of the role of the internet, it can be that link that connects the different branches
and universalizes employee standards. This includes web pages on what is expected of an
employee such as moral conduct, company policies, and even overall knowledge of the company.
The internet also can be used as an outlet for training - online streaming or even teleconferencing
would helpful ways to serve as a medium for training. The internet can finally be used to find
prospective candidates with the emergence of social media, and HR can use it to gain maximum
exposure to good prospects.