1. What is your opinion about John Mackey’s social mission at Whole Foods as a corporate strategy? Discuss the specific values in his “Declaration of Interdependence.” John Mackey explained that the concept of Whole Foods was patterned after Maslow’s human hierarchy of needs theory. This stated that human beings, once their need for food and safety was met, would aspire to fulfill their needs for belonging, community and beauty. John Mackey also stated that his desire was to promote the well being of the people and the earth. He frequently describes himself as a “caring person who wants human’s to flourish.” He is an evangelist for Conscious Capitalism a philosophy stating that businesses can profit from having passion and purpose. John Mackey basically geared his business towards looking out for not only the environment but also the whole human. In my opinion, John Mackey’s integration of his social mission as a corporate strategy was a great idea because companies with a social mission have a competitive edge.
Firstly, consumers, suppliers and the press will always talk about a company with a strong social mission. For example, ABC News did a 2013 documentary “Whole Foods: How Radical CEO Created Grocery Empire” which brought John Mackey’s philosophy to the spotlight thus increasing press for the company. Secondly, consumers are inclined to support a company that truly cares about their wellbeing and make a positive on the world. Lastly, people want to work for an employer who respects their ideas and treat them as “equal stakeholders.” The end result is more productivity and happy consumers because employees are happy so they advocate for the business. It is evident that this strategy is working for Whole Foods since it is a billion dollar company and is one of the largest specialist natural food chains in the United States. John Mackey’s Declaration of Interdependence was centralized around a stakeholder philosophy where all interested parties are interdependent on each other.
Basically, the company was not only focused on profit gain but also the needs of employees, customers, suppliers, investors the whole community and the environment as well. Their motto “Whole Food, Whole People, Whole Planet” highlights their goal to be more than just a food retailer but also a company that provides wholesome quality food products that are safe to eat while promoting a healthy lifestyle by teaching consumers/employees about food safety and the dangers of pesticides and GMO’s on the environment and body and to save the planet. Additionally, the company promotes an environment where employees can grow as individuals but they must share the company’s declaration. 2. Will Mackey’s plan for how teams operate be effective? Do you agree with the idea of publicly shared performance data and its links to compensation? I think his plan will be effective. John Mackey Declaration of Interdependence pushes for a decentralized team system.
Team members feel like they are major stakeholders because they are a part of the company’s decision making as they vote on benefits and team selections. Additionally, the company has an open book style management. John Mackey explained that he believes in hiring the best candidates, giving employees adequate training and ensuring that employees feel a sense of fulfillment in the workplace; all of which are effective motivational strategies. I think that because his employees are highly motivated and feel like they are a part of a team, they demonstrate a great degree of commitment, and loyalty to the company. Mackey has created an environment of friendly competition between other companies and within the Whole Food chains where teams compete to surpass each other in service, quality and store performance with the winning teams being offered incentives such as promotion, bonuses and public recognition. The result of offering incentives may help to extrinsically motivate employees; it pushes them to do better thus higher productivity.
Additionally, John Mackey has introduced a team environment where employees are encouraged to help each other and share knowledge for a common goal which is an effective motivational strategy. As Mackey puts it “Happy team members lead to happy customers and happy customers do more business with the store.” His team strategy is validated in the fact that Whole Food Markets has consistently ranked on the Forbes list of America’s Best Employers based on employee opinions with this year the company being at #55 (Forbes). Moreover, as highlighted in the exhibits, in 2005, Whole Foods had higher returns on equity, inventory turnover and net income compared to its competitors. I do agree with the open book style management as I feel that it maximizes each employee value, offers transparency in the company, and gives employees a sense of ownership. In the case of Whole Foods Markets, because employees are compensated based on performance they are more likely to go the extra mile to raise their financial rewards.
Therefore, productivity within the company increases. Public shared performance data also puts everything in the open so if targets aren’t achieved, employees are less likely to complain or enquire about their compensation. 3. What is your opinion about the perceived authenticity of the Mackey’s message, especially given the challenges to the “healthy eating” focus of Whole Foods? How might these challenges impact employee identification with the company? In my opinion, employees perform better when they feel as if they share the same goals and values as the company they work for. For example, living a healthy lifestyle is not just something preached by Whole Foods but it is practiced by the employees as well. To strengthen the employee identification with the company, Whole Foods offer employees compensation such as discounts and other rewards for their efforts in sustaining a healthy lifestyle. Additionally, employees are assimilated in the “healthy eating” culture of the organization from the moment they are hired.
Recently, it has come to light that Whole Foods Markets also sell products containing GMOs. This is very damaging to the company’s character as their core ideals have been challenged. This can have a negative impact on employee identification causing their performance to drop solely because they now view the company as one with no integrity just merely words and no action. 4. Do you see any problems with the integration‐differentiation dynamic in regard to the acquisition of Wild Oats and expansion of new stores? How could the acquisition have been carried out more effectively? How does increased competition impact decision making and employee relations within the company? Yes the problem with the dynamic is that there is an imbalance more differentiation. The acquisition could have been carried out effectively had the FTCC should have collected detailed pricing information from both Whole Foods and Wild Oats before they contended the merger. Increase in competition can force companies to make decisions contradictory to their ethical philosophy.
In the case of Whole Foods, their mission states that they provide consumers with quality products free of chemicals, hormones and other genetically engineered products. They have built their company’s reputation on telling consumers that their foods are safe to eat and at the same time saving the planet. However, research has shown that Whole Foods sells a number of products containing GMO’s in their stores. Although, Whole Foods have pledged to label all foods containing GMO’s by 2018. John Mackey said “the growing competition in the organic food market as a key reason for the retailer losing command of the market.” (Reuters) When there is an increase in competition, organizations tend to make strategic decisions to achieve advantage over the competition. As it relates to employee relations, increased competition leads to job insecurity. Employees may feel more job uncertainty so they go to great lengths to help the company beat out the competition.