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Calveta Dining Services, Inc.:
A Recipe for Growth
Key Issues:
The company lacks a strategic plan. When the patriarch of the family, Antonio Calveta, passed the company down to his son, Frank, he left him with one objective: double the company’s revenue within five years. Antonio did not provide a plan or strategic direction on how to achieve this objective. Furthermore, Frank has not taken steps to assess the viability of this goal. In the two years of being CEO, Frank has not outlined a strategic direction for the company, regardless if the strategic direction aligns with Antonio’s directive to grow revenues. Rather, Frank is still in the planning phase. Because of his lack strategic direction, Frank’s executive leadership is not working towards a strategic vision to assess the direction of the company: leverage the company’s success within the SLF industry, and/or expand the company’s footprint to include a larger customer base (i.e. hospitals), and/or pursue merger opportunities within the industry.
Calveta’s culture and infrastructure do not support ongoing aggressive growth. Jennifer Calveta, the Chief
Operating Operator expressed her concerns that the company’s culture and growth goals were conflicting objectives.
This concern was later brought to the CEO’s attention when he received feedback from a key account that they were dissatisfied with the service because of the frequent changes in managers that were servicing their account. Calveta placed a big focus on employee growth and internal promotion by rotating successful employees to larger accounts.
Frequent changes caused client dissatisfaction and ultimately led to long-standing, established clients to cancel their service contracts with Calveta, thereby decreasing the company’s revenue and customer base. With its current organizational design and rapid growth, Calveta is straying from its core values and principles that made the company successful.
Key members of the senior leadership team are in conflict. Jennifer (COO) and Frank (CEO) do not seem to be aligned and may actually be in conflict with each other. Frank was promoted to the CEO position from CFO position, whereas Jennifer had to “work her way up the ranks” and is highly vocal and dedicated. Jennifer and Frank are siblings and have issues in relating to each other, lack agreement on the direction of the company, and the corporate culture that is to be established for the company with their father’s retirement from the CEO role. While both Frank and Jennifer are invested in the company’s future, their conflict may threaten executive team dynamics and not allow for effective discussion and decision making.
Recommendations:
Hire a Chief Strategy Officer. Because this is a family owned business it appears that Frank the CEO and his sister,
Jennifer the COO are risk adverse. The siblings want to please their father and are not able to focus on the bottom line.
Research supported the need to diversify their portfolio and go after hospital accounts however, the team did not act fast enough and their competitors entered the hospital industry before them. By placing someone in charge of strategic planning, acquisitions and mergers the executive team will be more prepared to make high risk strategic decisions in a timely fashion. This Chief Strategy Officer could assess the viability of Antonio’s objective/mandate
