Kare-Full Katering

Harrison T. chk III is 43, married, and has two children, ages 10 and 14. He has a master’s degree in
education and teaches junior high school music in a small town in Ohio. Harrison’s father passed away
two months ago, leaving his only child an unusual business opportunity. According to his father’s will,
Harrison has 12 months to become active in the family food-catcring business, Kare-Full Katcring, Inc., or
it will be sold to two key employees for a reasonable and fair price. If Harrison becomes involved, the
two employees have the option to purchase a significant, but less than majority, interest in the firm.

Harrison’s only involvement with this business, which his grandfather established‘ Was as an hourly
employee during high school and college summers. He is confident that he could learn and perhaps
enjoy the marketing side of the business, and that hQ could retain the long-time head of
accounting/linance. But he would never really enjoy day-to-day operations. In fact, he doesn’t
understand what operations management really involves.

In 1991 Kare-Full Katering, lnc., had $3.75 million in sales in central Ohio. Net profit after taxes was
$105,000, the eleventh consecutive year of proHtable operations and the seventeenth in the last 20
years. There are 210 employees in this labor-intense business. Institutional contracts account for over
70 percent of sales and include partial food services for three colleges, six commercial establishments
(primarily manufacturing plants and banks), two long-term care facilities, and live grade schools. Some
customer locations employ a permanent operations manager; others are served from the main kitchens
of Kare-Full Katering. Harrison believes that if he becomes active in the business, one of the two key
employees, the vice president of operations, will leave the firm.

Harrison has decided to complete the final two months of this school year and then spend the summer
around Kare-Full Katering-as well as institutions with their own food services-to assess whether he
wants to become involved in the business. He is particularly interested in hnding out as much as possible
about operations. Harrison believes he owes it to his wife and children to fairly evaluate this
opportunity.

Case Questions

.1. Prepare a worksheet of operations activities that Harrison should inquire about this summer.

2. To manage the firm, how much does Harrison need to know about operations? Why?

3What problems do you expect Harrison to encounter this summer-r-both at Kare-Full and at other
institutions?

4If you were Harrison, what would you do? Why?