Background
Chattanooga Ice Cream was a division of Chattanooga Food Products and had a reputation for producing mid-priced, basic ice cream sold mainly in grocery stores. In the four years prior to the Case Study, the Ice Cream Division had experienced some rather drastic changes. Charles Moore, who was the grandson of the founder, took over as new President and General Manager. As well, three of the seven members of the top management team had recently departed and, in a drastic change for production personnel, the oldest plant was closed and production was consolidated into two newer plants.
Roots of the Problem
Each of these changes seems to have placed some stress on the system and climate of the company and, at the time of the Case Study, the company’s previous level of profitability and market performance had not yet returned. Exhibit 3 showed, graphically, that the bottom line (operating profit) was dropping more steeply than the top line (sales revenue). They appeared to be becoming less efficient as well as less effective. These recent changes the company had been experiencing, especially the recent management team and leadership turnover, were root causes of many of the company’s problems that were outlined in the case study. The team appeared to have not quite reached a point of comfort, trust and effective teamwork with each other and, although the recent loss of a large grocery store account was presented as the main problem in the Case Study, the loss of the account was a symptom and not the cause of the problem, the management team’s response, lack of teamwork and shortsightedness was. The immediate crisis may have been precipitated by the loss of the account, but it was exacerbated by the management team’s reaction, and was merely a symptom of a larger problem. Ups and downs always occur and accounts are gained and lost, that is normal