Qwerty
NA0100
The New Year’s Eve Crisis
William Naumes Margaret J. Naumes University of New Hampshire
It was Monday morning, New Year’s Eve day, 2001. On a day that many people were enjoying at home, Mike Valenti was in his office at Michael’s Homestyle Pasta. Since he had acquired the Southern Pasta Company on December 10, he had been learning the business, trying to get his arms around it, as he described it. Distance was a factor: Michael’s headquarters and plant were in Connecticut; Southern was located in Florida. Mike would have liked to be in Tampa, working directly with his new employees and trying to integrate the two companies’ cultures, but his wife was expecting their third child in early January and he needed to stay near home. In the due diligence period leading up to the purchase, it had seemed as though a new problem had developed every week. Finally, 3 weeks after closing, things seemed to be under control. The telephone rang. When Mike answered, he was not surprised to hear Ted Brewer on the other end of the line. Ted, Michael’s vice president for administration and operations, spent part of every week at the Florida plant. Ted began, “I hope you’re sitting down.” He went on to tell Mike that Southern’s quality assurance manager, Fred Jones, was in his office, and “You need to hear what he has to say!” He put Fred on the phone. Mike listened as Fred told him that the seafood-stuffed pasta shells that Southern had just shipped to its biggest customer were tainted with salmonella. “That can’t be true,” Mike responded. “We have the lab results that show it’s fine!” “I know,” replied Fred, “but those results were falsified.” In tears, the quality assurance manager explained that he had taken the samples of stuffed pasta that were to be sent to an independent lab for testing and baked them to make sure that any bacteria were killed; then he had frozen them and repackaged them to look like packages just off the production line. Southern’s president, Hans
The New Year’s Eve Crisis
William Naumes Margaret J. Naumes University of New Hampshire
It was Monday morning, New Year’s Eve day, 2001. On a day that many people were enjoying at home, Mike Valenti was in his office at Michael’s Homestyle Pasta. Since he had acquired the Southern Pasta Company on December 10, he had been learning the business, trying to get his arms around it, as he described it. Distance was a factor: Michael’s headquarters and plant were in Connecticut; Southern was located in Florida. Mike would have liked to be in Tampa, working directly with his new employees and trying to integrate the two companies’ cultures, but his wife was expecting their third child in early January and he needed to stay near home. In the due diligence period leading up to the purchase, it had seemed as though a new problem had developed every week. Finally, 3 weeks after closing, things seemed to be under control. The telephone rang. When Mike answered, he was not surprised to hear Ted Brewer on the other end of the line. Ted, Michael’s vice president for administration and operations, spent part of every week at the Florida plant. Ted began, “I hope you’re sitting down.” He went on to tell Mike that Southern’s quality assurance manager, Fred Jones, was in his office, and “You need to hear what he has to say!” He put Fred on the phone. Mike listened as Fred told him that the seafood-stuffed pasta shells that Southern had just shipped to its biggest customer were tainted with salmonella. “That can’t be true,” Mike responded. “We have the lab results that show it’s fine!” “I know,” replied Fred, “but those results were falsified.” In tears, the quality assurance manager explained that he had taken the samples of stuffed pasta that were to be sent to an independent lab for testing and baked them to make sure that any bacteria were killed; then he had frozen them and repackaged them to look like packages just off the production line. Southern’s president, Hans