The main problem at Kellogg-Champion is that the CEO, Royce Kellogg has no clue that his idea that things regarding the merger are in great shape are wrong. He told the consultants that all the “big integration related issues” were taken care of and all he really needs is some help finishing the small details of “finalizing common operating policies and procedures in ways that are good business and fair to all”. This sounded like a simple task, however it became obvious to Susan Barlow and Jim Roussos after just gathering and sifting through data that the commonalities between the two companies were not as prominent as they were led to believe. This probably should have raised a red flag and triggered an immediate request for a more in-depth discussion with CEO Royce Kellogg.
Another problem at Kellogg-Champion is that while the CEO, Royce Kellogg, made it sound as though there had been good communication throughout the entire merger thus far, the truth revealed something quite different. Even before interviews were started, Susan Barlow and Jim Roussos had problems getting interviews scheduled. Since Royce Kellogg, had told them both that they could expect complete cooperation from both companies employees and that both of the companies’ people had been told to expect them, this was another thing that should have raised a red flag. Perhaps with both the difficulty in scheduling interviews and the massive differences in policies and procedures, Susan Barlow and Jim Roussos should have recognized that they were walking into the lion’s den without the proper tools to tame the lion with.
Royce Kellogg seems to be under the impression that things are great and the merger is going smoothly. While the issues with communication and his obvious lack of knowledge about the real differences in policies and procedures are a good sign that Royce Kellogg actually has no clue about the real status of the merger, the case provides some insight into how he thinks...