CRA Inc

21 Jul 04 @ 10:20 am

An Organization Based on Love Instead of Fear

A quirky health-food grocer like Whole Foods may not share your organization’s culture, but it certainly provides an interesting case study in cultivating a strong set of (untraditional) values. Fast Company’s The Anarchist’s Cookbook explains:

The company had a written ‘Declaration of Interdependence’ (1,571 words, 249 more than the Declaration of Independence). It had a set of written core values (’satisfying and delighting our customers,’ ‘team-member happiness and excellence’). And most striking of all, even for a small company, it had a set of quirky management rules that made Whole Foods an odd but effective workplace.

Each store had a book in the office that listed the pay of every employee for the previous year. The book was available to anyone — and was especially valuable if you were promoted or if you relocated, and wanted to see how your pay compared with your colleagues’. The pay book, surprisingly little used, set a tone of what Mackey called “no secrets management.”

Every store was divided into about eight functional teams: You were hired to the seafood team, or the prepared-foods team, or the cashier/front-end team. But you didn’t just get hired. You got hired provisionally. After four weeks of work, the team you had joined voted whether to keep you; you needed a two-thirds yes vote to join the staff permanently.

Additional pay (beyond base wages) was linked to the teams, so people were careful about who got their votes. Thirteen times a year, Whole Foods calculated the performance of the people on each team in every store. How productive had the team been against goals? Teams that did well shared in the profits — up to $1.50 or $2.00 extra an hour was paid right back to team members, every other paycheck. So people didn’t want buddies on their teams; they wanted workers — people who were going to make them some money.

Individual team leaders made decisions about what to stock in their stores, in consultation with the store team leaders. No one in regional offices or in Austin dictated what would go on the shelves. Stores were encouraged to buy and stock local produce, fish, or meat, so long as they met Whole Foods’ quality standards. Stores competed against each other in 11 “customer snapshot” reviews a year — on everything from cleanliness to the drama of the produce displays. Ordinary employees qualified for stock options, and executives limited their own pay to eight times that of the average frontline employee. The company gave 5% of its after-tax profits to charity. And, of course, whenever possible, Whole Foods stocked organic or natural foods.

In 1992, a year after going public, Mackey announced, “We’re creating an organization based on love instead of fear.”

posted in category(s): Points of Interest