Whole Foods & Amazon - impact of acquisition on employeesConsidering a merger? Have you taken a second to think about the real impact it might have on your employees and morale?

Recently, Money Magazine published an article that describes the impact that a new system in Whole Foods stores has on its employees.

The system – called order-to-shelf – is an inventory-management system intended to create efficiencies and reduce food waste implemented by Amazon, who recently acquired Whole Foods. “Scorecards” are at the center of enforcement.

The system is seen as punitive by the 27 employees interviewed. Some are terrified of losing their jobs and, according to the article, morale has been hit. Employees spoke on condition of anonymity which is never a good sign of trust. One employee said, “The stress has created such a tense working environment. Seeing someone cry at work is becoming normal.”

Whole Foods, a company chosen as one of Fortune Magazine’s “100 Best Companies to Work For” since 1988, cites  “support[ing] team member excellence and happiness” as one of its core values. Yes, it seems the inventory system needed improvement and yes, it went too far, falling away from the Whole Foods culture that has served it so well for many years. In fact, 2018 is the first year Whole Foods did not make the “100 Best Companies to Work For” list.

Even more chilling is the comment made by David Lannon, Whole Foods Executive Vice President of Operations. He said in a call to investors, “The team members are really excited about OTS.”

This is the classic example of the disconnect that often occurs between the employee experience and leadership’s understanding of that experience. You cannot make employees become excited by announcing they are excited.

Conscious Culture

In conscious cultures, organizations understand the gaps between the leadership’s vision of the culture and the employee experience. Building and sustaining culture is analogous to the bridge between leadership’s desires and the real world that employees feel and see.

Implementing change of this magnitude requires a reflection on how it will impact the center and core of the culture. New systems must be applied in a manner that allows employee input before implementation. Using old Theory X leadership approaches of disciplining and firing staff if they are not meeting certain scores brings about fear and squelches any opportunity for input, continuous improvement and creativity.

Best Practices To Create Changes Into Culture

What needs to happen to incorporate changes into behavior and culture?

  1. Use the culture strengths when rolling out the change
  2. Be clear on what the new behavior looks like
  3. Understand how the values play a role in the change
  4. Educate staff on why the change matters
  5. Use the Theory Y approach by assuming people take pride in their work
  6. Provide staff with training and time to adopt to the new system
  7. Reward and recognize those moments when the new intended behaviors are working
  8. Coach, not punish, behaviors that are not consistent with the new approach
  9. Regularly measure what is working and not working through employee surveys
  10. Make system changes needed based on employee feedback and input.

As a fan of the Whole Foods culture and stores, I was saddened to understand how significantly this new system impacted employees. There is no question low morale and fear will affect the customer experience. I hope the employee voice is heard and used to make improvements.

Make sure every voice in your organization is heard before, during, and after making huge decisions for the company. It just might end up costing you more than just money…it could cost you your business.

Contact Conscious Culture Group for more information on implementing change and maintaining company culture & morale.