Adam Gerrit glanced up from the cash register as his first customers of the day walked into Jake’s Pet Land, a neighborhood pet store that is part of a small, regional chain. A young boy, obviously distraught, reluctantly placed a shoebox on the counter. “We have a problem,” whispered the boy’s dad, “and I would like to get a refund.” Cautiously, Adam lifted the lid of the shoebox and found an ebony-colored chinchilla hunched in the corner of the box, huddled in wood chips and barely breathing. Normally inquisitive and active, the chinchilla was obviously sick. The boy’s father, a loyal customer for several years, handed Adam a receipt. Adam knew the refund policy by heart: “The health of exotic animals is guaranteed for seven days after purchase. No refunds are granted after seven days.” The chinchilla had been purchased 10 days ago, but Adam, as a long-time employee, knew his manager would agree to bend the rules in this case and grant this cus- tomer a full refund. Putting the policy manual out of his mind, Adam handed the cus- tomer a full refund of $125, saying to the distraught boy, “I’m sorry your little buddy didn’t make it. Would you like to look for another pet?” Although he had clearly stretched the return policy rules, Adam felt confident that his store manager, Phillip Jordan, would support his decision.

Jordan did support Adam’s decision to bend company rules if it meant retaining a loyal customer. Although the store’s thick policy manual called for strict adherence to established procedures, Jordan encouraged employees to think independently when meet- ing the needs of customers. Jordan also felt strongly about building camaraderie among his small staff, even if it meant straying outside the edicts in the policy manual. For exam- ple, Jordan bought the entire staff pizza and soft drinks as a reward for their cheerful atti- tude when asked to stay late to clean out the stockroom after the store closed. While they restocked shelves and mopped the stockroom floor, his employees told stories, traded jokes, and enjoyed helping each other complete the job quickly. Jordan was proud of the productive yet friendly culture he had created, even if his district manager would frown on some of his decisions.

Without surprise, Jordan’s store steadily increased revenue, up 5 4 percent from the previous year. Employees were motivated and enthusiastic. One factor contributing to the store’s success was low employee turnover. Again setting company policy aside, Jordan retained his employees by offering slightly higher wages, granting small promotions with increased responsibilities, and rewarding “VIP” employees with free passes to a local theme park. Since all of the employees were pet owners, he also allowed employees to take home overstocked pet supplies and free samples of new pet foods. This loyalty to employees resulted in a successful store. But Jordan knew his district manager would abruptly end all of these practices if he knew about them, so Jordan learned to keep guarded secrets.

Trouble began when Jordan was transferred to another store, closer to his home, and a new manager with a completely different managerial style was brought in. Wedded to rules and procedures, Jan Whitall was driven by order and discipline. On Whitall’s first day on the job, she set the tone for her tenure with this announcement: “The company’s new com- pensation policy will be strictly followed in this store, and some of you will have your pay reduced to adhere to the new pay scales. This is uncomfortable for me, but it’s the result of some questionable decisions by your previous manager.” The morale of top performers, including Adam, plummeted. By the end of Whitall’s first month, she had fired an employee for violating the store’s return policy. The employee had granted a full refund for a ball python after the seven-day return period. Another employee was publicly reprimanded for giving a customer a sample of a new organic pet food to try before purchasing it. Stunned by these actions, employees became indignant and bristled under her tight authority. The friendly, warm culture had vanished. Adam Gerrit confided to his coworker, “I’ve applied for a position at the pet superstore down the road. Before I resign, I’m going to talk to Jan and see if she can lighten up on the rules.”

Mustering his courage, Adam tapped on Whitall’s office door and asked if he could talk with her. Putting down her reading glasses and pushing away the financial reports in front of her, Whitall motioned for him to sit down. “I’m worried about morale around here,” Adam began. “Some of our best workers are leaving and I’m considering it, too. Under our previ- ous manager, I loved coming to work and enjoyed the friendship of coworkers and custo- mers. Now, everyone is in a sour mood and we’ve lost some customers.” Taking a deep breath, he continued. “If you are willing to be more flexible with the company policies, I would be willing to stay.” Unflustered, Whitall kept her firm stance. “Adam,” she explained, “I’m responsible to the district manager, who long suspected that the previous manager wasn’t adhering to company policies. It’s my intention to do my job the way I’ve been instructed, and I’m sorry to hear you will be leaving.”

As Adam left her office with his head down, Whitall mused to herself that the district man- ager would be proud of her ability to stand firm. In fact, he had recently complimented her on her approach. Neither realized that sales would take a surprising dip in the next quarter.

 PART 3 THE PERSONAL SIDE OF LEADERSHIP QUESTIONS
1. Which store manager—Phillip Jordan or Jan Whitall—would you prefer working for? How did each leader’s style affect the culture of the pet store? Explain.
2. What kind of follower was Adam Gerrit? In general, what characteristics of followers do you admire? What characteristics would you want them to display when working for you?
3. If you were the district manager, which store manager would you prefer to have work- ing for you? Why? In your opinion, which manager did a better job of managing up? Which manager did a better job of managing down?