The die was cast. Prem Nath Divan, executive chairman ofVertigo, the country’s largest engineering project organization,decided to switch tracks for a career in academics. Divan was stillsix years short of the company’s retirement age of 65. Hispremature exit was bound to create a flutter at the Vertigo board.Having joined Vertigo as a management trainee soon after college,he had gradually risen through the hierarchy to take a boardposition as the marketing director of the firm at 32. He had becomethe president five years later and the youngest chairman of thecompany at 45. But, by the time he was 50, the whizkid had acquireda larger than life image of a role model for younger managers and astatesman who symbolized the best and brightest face of Indianmanagement.

          On hiswife’s suggestion that it would be wise to discuss the move withone of his trusted colleagues before making a formal announcementof his intention to seek premature retirement, Divan called onRamcharan Saxena, a solicitor who has been on the Vertigo board forover a decade. Sexena was surprised at Divan’s plan. But he wasunfazed. “If that is what you want to do for the rest of your life,we can only wish you well”, he told him. “The board will miss you.But the business should go on. We should get down to the task ofchoosing a successor. The sooner it is done, the better.

          “I thinkthe choice is quite obvious, “said Divan, “Ranjan Warrior. He isgood and …” Divan was taken aback to see Saxena grimace. “You don’thave anything against him, do you?” he asks him. “No, no,” saidSaxena, “He is good. A financial strategist and a visionary. Hisconceptual skills have served the company well. But he has alwayshad staff role with no line experience. What we need is someonefrom operations. Like Richard Crasta.”

          “Richardknown things inside out alright”, said Divan, “But he is just adoer. Not fire in the belly. Vertigo needs someone who understandsthe value of power and known how to use it. Like me. LikeRanjan.”

          “That isjust the problem, “said Saxena. “Prem, let me tell you something.Ranjan is a man in your own image. Everyone known that he is yourprotégé. And are never popular. He has generated a lot ofresentment among senior Veritigo executives and there would be arevolt if he were to succeed you. An exodus is something we can’tafford to have on our hands. We should think of someone else in theinterest of stability to top management.” Divan could not believewhat he heard. He had always prided himself on his hands – on styleand thought he had his ear to the ground. “How could I lose touch?”he wondered, somewhat shaken.

          “When youare the boss, people accept your authority without question,”continued Saxena. “In any case, you have been successful at Vertigoand it is difficult to argue with success. But the moment youannounce your intention to leave, the aura begins to fade away. Andin deciding on your successor, the board will seek your opinion,with due regard to your judgment. The board member must do what intheir view is right for the company. Having said that, may I alsomention that if there is a showdown in the boardroom, you couldalways choose to stay on ? We would like it. Or we could bring inan outsider.”

          “I havefinalized my career plans and there is no question of staying onbeyond six months from now,” said Divan. “The board is scheduled tomeet next month. Let us shelve the matter till then. In themeantime, I rely on you, Ram, to keep this discussion between thetwo of us.”

          “Ofcourse yes,” said Saxena.

          On hisway home, Divan thought about the matter in detail. Bringing anoutsider would undo all his life’s work at Vertigo. There wereconsiderations like cuture and compatibility which were paramount.The chairman had to be an inside man. “Richard lacks stature,“Divan said to himself. “Ranjan is the one I have been grooming,but heavens, the flip side of it all had missed me completely.There is no way I can allow a split at the top just before I quit.I must leave on a high note in my own interest. I must find a wayout of he imminent mess.”

Question:

1.         Whatshould Divan do?