Wrong reaction ...
Harold should have reacted by:
(1) Warmly praising his 2IC for brilliant leadership and the will to make hard organizational decision,
(2) asking about the budget that will be available for organizing the transition to new usernames, or
(3) requesting an external review to establish the required effort and budget to make the transition.
Most people only start thinking if it costs money -- so money is the argument against stupid make-do-work.