Amazon + Whole Foods: A People-Centric Merger?
“Crying at work is becoming normal’: Whole Foods employees revolt after Amazon imposes ‘scorecard’ system”. This is what the headline read on February 1 when I opened my inbox to look at the headlines.
Here at Geigsen, we are all about understanding what drives a company to create strategies that are people-centric – one that is so well connected to the individuals driving it, that it stands a better chance of being executed.
Suffice to say, with headlines like this, the new Whole Foods strategy is not people-centric.
The story explains that, with Amazon as new management, they are implementing a score card system at Whole Foods in which 90% of all store management tasks must be done with extreme precision, or else store managers are subject to a binary – pass / fail. Store managers, are in turn advised to “pelt” employees with pop-quizzes about sales goals and the like.
At the heart of it, the issue being faced here is a clash of cultures between Whole Foods and their new acquirer, Amazon. Within Amazon, one might easily imagine a workplace in which detailed measurement and analytics rule the day, with the kind of employee examination and score cards described above being commonplace. This, of course, fits with their overall strategy of operational excellence and price-competitiveness. At Whole Foods, however, their strategy is much different, focusing on a strategy that revolves around superior product and friendly / knowledgeable staff that make shopping there an excellent experience.
As this news story clearly depicts, this is what happens when companies try to drive strategic change but ignore organizational culture. The people at Whole Foods now saying things such as: “I wake up in the middle of the night from nightmares about maps and inventory, and when regional leadership is going to come in and see one thing wrong, and fail the team…”. Unless this changes, the next time you walk into a Whole Foods you might not get that friendly staff, but a sleep-deprived, anxious store manager yelling at his or her employees to get in line – hardly what a patron expects from this venerated grocery retailer. Ironically, a good, well-intentioned, strategy will quite likely undermine Whole Foods financial performance all because of the way in which it was implemented.
So what’s gone wrong here? Only a thorough investigation would tell, but from the details in this story, a few items are striking:
The lack of connection between the intent of the strategy and its implementation – while this policy is meant to provide a clean and pleasant shopping experience for patrons, it is resulting in stressed out store managers and employees who are literally crying in the store
The over-emphasis on “stick” and not the “carrot” – there is no clear positive incentive to drive this program, with regards to rewards or recognition, only sticks
The poor quality of the communications associated with this change – even in the absence of the above, a high quality communication program that explained why this was being done, could have aided in buy in and engagement with the way it was being done
So here is the question: how would you approach this situation differently? If you were sitting with Jeff Bezos, what would you ask? What would you recommend?
Source: Rawstory, Business Insider