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A director within the leadership development program of a large multinational organization must decide how to manage a very difficult conversation she must have with her assistant director. The assistant director, who is older and more experienced (although less educated), interviewed for the director's position and didn't get it. The assistant director has never been happy reporting to her much younger boss, and has felt consistently left out of major decisions. The assistant director had confronted the director about her feelings and threatened to resign. How should the director handle this difficult conversation?

Companies commonly adopt "the customer is always right" maxim as a basic premise for delivering quality service. A close examination of customer behavior, however, reveals that customers can be not only wrong but also blatantly unjust. Unfair customers take advantage of being "always right" by demanding unwarranted privileges and compensation, adversely affecting companies and, in some cases, employees and other customers. Companies can actually strengthen their ability to deliver quality service by dealing effectively with unfair customers.

This is an MIT Sloan Management Review article.

Consumers of health care constitute a highly diverse market, but the idea that companies might segment customers and profit by addressing their varied needs seems almost foreign to the health industry. You can tap hidden value by making use of patterns in the demand for health products and services, especially if you segment consumers according to health and wealth at the same time.

In 1995, Institutional Investor magazine began selling a complete ranking of the best equity research analysts. This report allowed research firms to assess the relative quality of each analyst across the industry, and this enabled firms to know nearly as much about the quality of analysts at other firms as they knew about the quality of their own analysts. Ponders the impact that increased transparency of performance will have on the labor market for equity research analysts, and asks how the directors of three different research firms ought to respond given each firm's competitive situation.

All executives would like to see their organizations perform better, and most search for tools that can help make this happen. For decades, human resource managers have believed that their function enhances performance. This contention has been met with skepticism on the part of executives, however, who wonder whether funds allocated to the human resource function are good investments. Dozens of studies have examined this issue, but their inconsistent results have provided no conclusions. To resolve a long-standing and controversial question - does human resource management matter for organizational performance? - we take stock of the available evidence. Based on data from over 19,000 organizations, we conclude that human resource management adds significant value for organizations. In addition, the value added is strongest when human resource systems are emphasized rather than individual practices, when human resource management decisions are tied to strategy, and among manufacturing firms.

A team led by Vivienne Cox, Executive Vice President for Gas, Power, and Renewables, identifies and launches a new business, BP Alternative Energy. Investing on this scale in a "green" power business was a radical departure for BP.It illustrates how Cox guided the emergence of a vision for AE, got key stakeholders on board and set in place conditions for a highly motivated team.

Describes the development and implementation of one of the world's most advanced human resource management support systems. The Royal Bank of Scotland Group is a global banking leader that began implementing a strategy for measuring the impact of human capital on bottom-line financial metrics in 2000. Spearheaded by HR executive Greig Aitken, this strategy included the use of an online toolkit of software through which HR executives could measure employee performance, gauge its impact on business performance, and commission new unit-specific surveys and studies. Aitken faces several challenges in advancing the use of human capital strategy throughout the Group: namely, how should he further build buy-in among key Group executives? And how should the Group respond when human capital analysis reveals some startling results in one of its most important divisions?

In this fictional case, Jennifer Gaston, founder and CEO of mid-sized luxury jewelry company Aquamarine, was managing a couple of key hiring issues that had recently cropped up. In just six months, Gaston had brought in a new COO and was about to finalize a multi-month search for a CFO. Although she had nearly completed the transformation of her executive team, she still needed to thoroughly check references on the CFO candidate and extend a formal offer. A lot was riding on these positions and, despite the help of an executive search firm, hiring for them had not been easy. Students are asked to evaluate several aspects of hiring and prepare role plays for them.

This supplement to Employee Engagement at Modern Appliances Inc. (A), product #907C35, looks at a specific problem situation arising from the initiative and discusses how the chief executive officer may respond to it.

Describes a compensation dilemma with a father and his three children, who work in different businesses under the family holding companies. The father, James Kohl, must set compensation that meets the needs of the family and the business.

A very successful Indian SME manufactured furnishing textiles and was operating exclusively in the exports sector. The company had no formal human resource (HR) systems and procedures nor did it have an HR manager. The sole proprietor took his only young son, an MBA, as a partner. He had his father's consent to his ambitious plans of business expansion, including manufacturing similar products to cater to the needs of the domestic market, and in this regard wanted to cash in on the Flaxo brand that the company had built over the years in the exports market by strengthening it in the domestic market as well. Narrates the typical business strategy and people-management practices that are followed by SMEs in the Indian context and helps understand managing people in SMEs, including the employee relations situation and the whole structural and procedural dynamics that surrounds these activities. These activities at Flaxo are marked by the practice of paternalism by a caring employer, whose leadership style helps it in getting a competitive edge through a higher degree of employee commitment. Highlights certain indigenous practices of employment and work organization that have become part of the culture of this industry, and focuses on the ways in which the owner gets greater advantage by building on these practices. Raises the dilemma of the new partner (son of the earlier owner) as to whether he should establish formal HR systems and procedures in his attempt to build the Flaxo brand and thus to professionalize people management, or should he continue with the time-tested existing indigenous practices, which are cost-effective and presently working well.

The chief executive officer of Modern Appliances wants to change the culture in the company towards one of engagement of people at all levels of the organization. The (A) case describes the ModernIzation initiative and provides a basis for analyzing the reason for the initiative and identifying some of the issues that may arise from it. The (B) case looks at specific problems that arise and the (C) case discusses the process used by the company.

This supplement to Employee Engagement at Modern Appliances Inc. (A), product # 907C35 features the chief executive officer talking about the need for engagement and the process that Modern Appliances used.

In mid-2007, Infosys was an extremely successful business. Headquartered in India, it had played an important role in transforming global business. Revenues were growing rapidly, and the company was highly profitable. The company's revenue growth was closely linked to its ability to recruit, train, and retain talented employees. The demand for talent among IT companies in India was straining the country's education system. At the end of March 2007, Infosys had 72,000 employees, an increase of nearly 20,000 from the previous year. Increasing growth would require even higher numbers of new employees. Attrition was also an issue, running at about 13% annually and adding to the number of new employees required to meet revenue objectives. In mid-2006, Mohan Pai moved from his position as CFO to take over human resources, education, and research. Describes the Infosys culture and human resources environment in 2007, and focuses on the issues faced by Pai in hiring, training, motivating, and retaining employees in a business that was dependent on a highly talented employee base. Specifically, asks students to consider ways of addressing the issues of hiring, attrition, and allocation of employees.

Employees in stigmatized occupations can be helped with an array of techniques to cope with or even feel proud of their jobs, including developing an occupational ideology to confer a more positive image on the work; creating social buffers such as professional associations; and avoiding specifics in conversation with outsiders.

Two decades ago, people began using the "glass ceiling" catchphrase to describe organizations' failure to promote women into top leadership roles. Eagly and Carli, of Northwestern University and Wellesley College, argue in this article (based on a forthcoming book from Harvard Business School Press) that the metaphor has outlived its usefulness. In fact, it leads managers to overlook interventions that would attack the problem at its roots, wherever it occurs. A labyrinth is a more fitting image to help organizations understand and address the obstacles to women's progress. Rather than depicting just one absolute barrier at the penultimate stage of a distinguished career, a labyrinth conveys the complexity and variety of challenges that can appear along the way. Passage through a labyrinth requires persistence, awareness of one's progress, and a careful analysis of the puzzles that lie ahead. Routes to the center exist but are full of twists and turns, both expected and unexpected. Vestiges of prejudice against women, issues of leadership style and authenticity, and family responsibilities are just a few of the challenges. For instance, married mothers now devote even more time to primary child care per week than they did in earlier generations (12.9 hours of close interaction versus 10.6), despite the fact that fathers, too, put in a lot more hours than they used to (6.5 versus 2.6). Pressures for intensive parenting and the increasing demands of most high-level careers have left women with very little time to socialize with colleagues and build professional networks--that is, to accumulate the social capital that is essential to managers who want to move up. The remedies proposed--such as changing the long-hours culture, using open-recruitment tools, and preparing women for line management with appropriately demanding assignments--are wide ranging, but together they have a chance of achieving leadership equity in our time.