Kate Elliott, a new product development specialist at Donaldson Family Foods, Inc., paced in her office and

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Kate Elliott, "a new product development specialist at Donaldson Family Foods, Inc., paced in her office and shuffled papers on her desk. She had a lot of work to do, but she couldn't seem toconcentrate. It had been one month since she presented a comprehensive proposal for product testing to SMART, the Senior Management Action Review Team. She needed an answer on whether she could move forward on test-marketing an"all-in-one"insulated portable cooking bag that had been developed as the anchor product for a high end, quick fix, specialty picnic foods line. The planned product launch and the portable cooking bag were scheduled to coincide with Memorial Day weekend, the traditional start of picnic season. Although Memorial Day was still six months away, Kate knew that her window of opportunity for completing the test marketing was closing quickly. If she missed the time frame scheduled for Memorial Day weekend, there was a good chance that annual sales projections would fall short. She didn't want to think about the consequences. Kate wondered why she could not get a straight answer. Could their dallying be the result of the famous"Black Hole"she had been warned about when she first joined Donaldson Family Foods 10 months earlier?

When Kate received a call from an executive recruiter about a"great opportunity"at Donaldson Family Foods, her immediate reaction was"No thanks,not interested."A recent MBA graduate with two years experience under her belt at a Fortune 500 food manufacturing company, Kate was primed for the fast track. Her goal was to become one of the youngest national brand managers in the country by the time she was 28. All that Kate knew about Donaldson Family Foods was that it was a privately held family company that had been canning vegetables since 1899. The products had not changed in over 100 years--even the labels had not changed in 50 years. To Kate, Donaldson family foods was a low growth, low margin commodity business. It was stale and old, and she had no interest in applying there. Then she received a phone call from Jeff Donaldson, the president and CEO of his family business. Stunned by his forthright candor and calling her directly, Kate agreed to come for an interview.

Jeff Donaldson was the 4th generation to lead the family business. A graduate of Duke University with an MBA from Michigan, Donaldson was groomed from birth to take over the company. During high school and college he worked summers at the canning plants, driving forklifts, hosing down equipment, and changing the glue canisters for the labeling machines. After Graduate School, he started as a shift supervisor, eventually working his way up to plant manager. Before rising to the office of the president,

Donaldson had done a tour of duty in the marketing department and served as chief financial officer for six years. At 45, the man knew his business.

Kate was impressed by Donaldson's charisma and sincerity. "You're just the type of person I want on my team,"he had told her."I'm ready to move into the high growth, pre-packaged, specialty Foods Market. I need bright, energetic, and creative people who can take ideas from concept to completion without a lot of interference from management."It was that last phrase,"without a lot of interference from management,"that caught Kate's attention. Kate was ready to manage a portfolio. Donaldson dangled the ultimate carrot in front of her."If you come on board with me, your first project will be to handle the introduction of our new portable cooking bag at the same time we launch our new pre-packaged specialty picnic foods next year. You handle this right, and you'll be a national brand manager before you know it."Kate was hooked.

She liked everyone she met at the company, the money was good, the onsite workout facility and juice bar were an immediate bonus, and the opportunity to become a national brand manager was definitely the trump card. Kate could not think of one reason she should not join the company.

One of the first things Kate noticed during her first weeks at Donaldson family foods was how lax everyone seemed to be about office hours. At 7:30 every morning, her car was generally the first in the parking lot. Most of the marketing and new product development people did not arrive until 9:00 AM. By 5:15 PM, the parking lot had cleared out, except for a few cars. Kate chalked up the late start and the early departures to the emphasis on family that Jeff had stressed in their first meeting."This company was founded by my grandfather 100 years ago on the simple premise of neighbors working together to make a better life for themselves,"Donaldson had told her. "No one is expected to put in a 70 hour work week. Time with the family is important. Even our plants close on Sundays and major holidays so workers can be with their families."

It did not take Kate long to feel comfortable. During her first few weeks on the job, someone in the main office dropped by her office nearly every day to chat and welcome her aboard. The place was full of nice people, so it caught her by surprise when, after offering a problem-solving remark, she was singled out at a staff meeting for being"two aggressive."

Rick Clark, her immediate supervisor, told her,"now Kate, that might be how you talked to others at your last employment, but around here, we don't attack each other in staff meetings."

Embarrassed, Kate stammered,"I'm sorry...I wasn't trying to hurt anyone's feelings...I was just trying to look at what the objections might be if..."

Clark cut her off with a wave of his hand. "We know you don't know any better yet, but you'll learn. We keep it nice and friendly around here in all our conversations. It's the Donaldson Family Foods way."

In her office later that morning, Kate replayed the exchange over and over in her mind. She was confused. Tom Kadzinsky, a veteran product development specialist, poked his head in the door."Mind if I talk to you for a minute, Kate?"he asked.

Kate motioned for Tom to sit down. "Tom, what just happened to me in that meeting?"she queried.

"Ah,that was the official'welcome aboard and don't rock the boat lecture from Rick,"he replied. "All of the relatively new people have gone through it, Kate." Kadzinskyshrugged.

"Do you mean we're not allowed to criticize or challenge anything in a staff meeting?"she asked.

"Yeah,that's pretty much it,"he replied dryly. after a long silence, Tom continued,"I can see the wheels in your brain churning. You're trying to figure out what's going on here, right?"

"How do you get anything done around here?"she asked.

"Things get done eventually,"Tom stressed."This is a privately held company in a low growth business. Because there's no big hurry, SMARTthe Senior Management Action Review Teamalways takes its time making decisions."

Kate was incredulous. "Wait a minute. Jeff Donaldson himself told me that the company was positioned to move into new, high growth markets. If we're going to be competitive we're going to have to make decisions in real time and get new products to market faster than our competition. All of that suggests decentralized decision making."

Tom smiled. "Yeah, it's even in our mission statement, but that's not the way things really work around here."

"Thenwhy would they hire people like us? It makes no sense."Kate sighed. "I came here for the chance to be a national brand manager, to do cutting edge work. I didn't come here to babysit a bunch of 100 year old products."

Tom looked out Kate's window onto the manicured lawn and landscaping in front of Donaldson family foods. "In my interview,"Tom continued, "Donaldson promised that I would be in charge of branding a Of Latin foods. I've been here three years and I have yet to roll out a single new product."

Kate sat silently, taking in this new disclosure."It's because of the Black Hole,"Tom stated."What's that?" Kate asked.

"TheBlack Hole is the nickname the employees have given to the SMART group. In those weekly meetings of SMART, all initiatives, ideas, and proposals come to a grinding halt. Nothing moves forward until SMART has given its approval."

"How could there be a black hole when, according to Donaldson, the company hierarchy has been flattened to shorten the decision-making time?" she asked.

"Look, Kate," Tom offered as he turned to leave, "it's always a little frustrating at first here, but you'll get used to it, and why sweat it? The money is good, the hours can't be beat, and there is no pressure to perform. No one ever gets fired from Donaldson Family Foods."

Kate reached for her company manual. It was the first thing she had been given by the human resources manager when she joined the company. She opened to the inside cover and stared at the smiling panda

face of Jeff Donaldson. Even in photographs, he was charismatic she thought. She reread the vision statement next to his picture:

At Donaldson family foods, we are committed to being the number one innovator of high end, specialty food products. We will reach this goal by employing the best and the brightest, adhering to the best management practices and offering the best value for our customers, suppliers, and vendors. To this end, we strive to provide a safe and congenial workplace for all employees, offer personal and professional improvement programs, and compensate generously for performance. We provide a business environment in which innovation and creativity can flourish, and people at all levels of the organization are empowered to make decisions as if they own the company.

She agreed with every word in the vision statement. It sure looked good on paper.

The day after Kate's conversation with Tom, Jeff Donaldson dropped by her office. He flashed his winning grin as he sat in the plush visitors chair across from her desk."I just wanted to check up on you and see how you are getting along,"he started.

"I'm doing great,"Kate offered hurriedly.

"Good!" he replied. "I know you are ready to break out from the back of the pack and become lead sleddog for Donaldson Family Foods!"Kate made a mental note of how Donaldson always peppered his conversations with metaphors about dogs. "She's a greyhound,"he had told Kate when describing the CFO,Katherine Haliburton. "I hired her straight out of Business School. She made it to the front of the pack in less than five years."

Donaldson seemed to have a rating system for all his employees. he referred to some as greyhounds (fast, with a strong desire to win), St. Bernards (loyal, but not very productive), or strays and puppies. Kate wondered if he had already settled on a dog rating for her.

Donaldson continued, "I think it's time for you to take on the cooking bag project we talked about during your interview."Kate took out a pad of paper and jotted down notes while Jeff Donaldson shared his ideas with her. Ashe left her office an hour later, he offered one more suggestion. "Call Angie, my secretary, and make sure she putsyou first on the agenda. Can you have the numbers ready in three weeks?"

"I'll be ready," Kate said confidently. All concerns regarding Tom's warnings about the black hole went out of her head.

Kate worked tirelessly, putting together the numbers and rationale for the new portable cooking bag. The centerpiece of the plan wash the focus group research. She could not recommend the company move forward with production of the bags without strong evidence from the focus group research. With calendar in hand, she estimated when everything had to be completed to make the Memorial Day kickoff. Kate called the focus group research company and told them to have everything ready in one week."This shouldn't take long,"she told the owner of the research company."I've got the budget, the timeline, and the rationale all worked out. I know it's a'go.'I just need to get the final green light from Mr. Donaldson."

During her presentation, Kate fielded questions from the senior vice presidents. At the end, Donaldson announced,"Kate, this is really excellent work. I will have an answer for you shortly." She departed the meeting confident about her performance and the plan. She went back to wait for the answer from SMART. Inwardly, she laughed at how gullible she had been to believe there was a black hole.

At the end of the week, after Kate had made her presentation to SMART, the phone rang in her office. It was the president of the research company. "Hello, Kate? This is Dave Seavers at Independent Research. I'vegot people on standby waiting for your signal.What's the word?This is starting to cost me money."She felt terrible as she tried to stall for time."I'm sorry, Dave.Jeff Donaldson has been out of touch this week with an emergency at the northern plant. I'll call you as soon as I have an answer. To be on the safe side, you better let everyone go for now."

Now, one month later in her office, Kate was lacking confidence with every breath."This has got to be bad news," she fretted. "How could I have missedthe mark so badly? why doesn't one of them call me and at least tell me something?"

Kate drove home frustrated and tired from the lack of communication at Donaldson Family Foods. "This is not what I signed on for,"she thought bitterly.

Monday morning, Kate called the president'ssecretary, Angie Parker, trying to sound confident.

"Hi, Angie.This is Kate Elliott in new product development. I need to set up an appointment with Mr. Donaldson as soon as possible."

"What's this regarding?"The president'ssecretary and gatekeeper asked coolly.

"Well, it's beenone month since I presented the test marketing proposal at the weekly senior management meeting. I have a very tight deadline, and Mr. Donaldson assured me that he would get back to me promptly. I'm just following up because I have a lot of people on standby, waiting for the signal to begin. I don't have much time to spare if we're going to make this rollout in May. I just need to know where we are on this."

"Kate, ifMr. Donaldson said he would get back to you, I am sure he will. Mr. Donaldson is in the Bahamas this week with clients and cannot be disturbed. When he returns next Monday, I will let him know you called."

"Monday! Angie, I really need an answer before then. Can't somebody else on SMART give me an answer?" "I'm afraid you'll just have to wait until Mr. Donaldson returns."

Kate felt totally adrift. With each passing day, the chances of her making the Memorial Day weekend kickoff were fading quickly."How could I have been so wrong about Jeff Donaldson and this place?"she thought. "Is he the consummate liar or was I naive to think I could make product development decisions on my own?"

Kate walked into the spacious break room, complete with fireplace and television, where employees gather to chat, exchange pleasantries, and sample new products. The place looked the same as the day she started, but now she saw things with different eyes."Jeff Donaldson may have flattened the organization, but he never empowered his people,"she thought bitterly."We are all just hanging around waiting to be told what to do."

Kate walked up to Tom Kadzinsky, who was pouring himself a second cup of coffee, the newspaper under his arm."Does anything ever come out of theBlack Hole?"Kate asked.

Tom looked at Kate sympathetically and said,"yes, but generally not until you have completely abandoned the project and given up all hope on it."

Kate felt defeated. She stammered, "Why do you stay, Tom?"

"Kate,I may be here physically, but my heart and soul have left the building," Tom replied flatly. "I got my hand slapped so many times my first year, I quickly learned to keep my mouth shut, my thoughts to myself, and just do little as possible. I have two kids in grade school, a wife, and they all like it here. There are worse things in life

than not being fulfilled professionally. And I am one of many just look at the parking lot. There are a lot of people with this organization who check out early every day."

There was a lag in the conversation and finally Tom said, "come on, Kate. you'll get used to it, especially when you realize there's really nothing you can doabout it."

Kate had given up a lot to come to Donaldson Family Foods. She thought about the friends and family she had left when she moved halfway across the country to take this job. What had seemed like such a promising career move now felt like a big mistake."I don't know, Tom. I just don't know..." Her voice trailed off.

1. Please describe Donaldson's strengths and weaknesses with respect to his roles as a manager (Interpersonal, informational, decisional).

2. Please describe the extent to which Donaldson demonstrated technical, conceptual, and human skills.

3. Which of the seven challenges to being an exceptional manager did Donaldson best address? Which has he most neglected?

4. How would you describe Kate's career readiness? What are her strengths and weaknesses? Try to be as specific as possible using examples from the textbook.

5. How well would you say that Donaldson satisfies Maslow's hierarchy of needs in his employees? Please explain.

6. Do you think that Donaldson has more of a Theory X or Theory Y view of human nature?

7. Given the information provided, to what extent does Donaldson implement evidence-based management, the systems viewpoint, and the learning organization into his decision-making process? Please explain.

8. What benefits might Donaldson obtain from taking his company global?

9. If he were to take his company global, what mode of entry do you think would best suit Donaldsons'core competencies?

10. Given Donaldsons'strengths and weaknesses, do you think Donaldson should take his company global? Please describe some of the factors that are likely to influence his success or failure.