zeynep tonRecently I had the pleasure of talking to Zeynep Ton, adjunct associate professor at MIT Sloan School of Management, about her book "The Good Jobs Strategy".  I've written about this excellent book here before.  Zeynep's core message is that excellent financial returns don't have to come at the expense of employees.  In fact, her research indicates that investing in  employees as a driver of strategic advantage vs. treating labor as a cost to be minimized will ultimately drive higher returns for all stakeholders.   You can listen to a podcast of our discussion about the lessons from her book  below:

 

Zeynep was kind enough to invite me to MIT Sloan School last night for a symposium on the recent Market Basket story - wherein loyal employees and customers successfully organized and disrupted store operations in response to the ouster of  their trusted CEO.  Market Basket is widely known for applying many of the principles Zeynep reviews in her book.  In fact, Zeynep and some of her colleagues will be writing a case study on Market Basket for aspiring business leaders to study.  Several hundred students, faculty (and members of the public like yours truly) packed a sold out auditorium to hear management and labor experts talking about the lessons to be learned from Market Basket.

One of the more interesting observations last night came from MIT finance professor Andrew Lo, who said the Market Basket approach proves "Finance doesn't need to be zero sum game."  His point, and that made by others on the panels, was that Market Basket employees act like owners.  They care about their bonuses and profit sharing - and they understand that maximizing their personal returns is dependent on doing right by their customers. They've been empowered to do what it takes to keep those loyal customers coming back, a "distributed leadership model" as one professor noted. In the end, those ties that bound the Market Basket employees to their embattled CEO and each other during the standoff were also connected to their customers.  And ultimately it was the customers' willingness to boycott the stores in order to preserve the brand they loved that turned the tide.

Relevant Links:

News coverage of the symposium on Boston.com

Seismic Shift - Waking Up to the Strategic Value of Workforce Management

New York Times article “Thinking Outside the (Big) Box”

Good Jobs Strategy = Happier Employees = Better Customer Service

 

 

 

 

 

 

 

TWS20.600.dashboardIn a recent New York Times Magazine article entitled Thinking Outside the (Big) Box, Adam Davidson (of NPR's “Planet Money) talks about a great customer service experience he had at Ikea recently when he went shopping for a closet system.   He found the staff to be both available and helpful.  He was surprised given that he'd had a prior experience years ago that wasn't so hot, so he decided to investigate what had changed.  He spoke with an executive at Ikea and learned the following:

"This wasn't a fluke. A couple of days later, Rob Olson, the C.F.O. of Ikea U.S., told me that since my last visit, the company had invested in a new (Kronos) work-force-management system that reminded me of much of Ton's thesis. The software helps the company to better distribute workers throughout the store, so that there are more of them in the areas where people have the most questions, like closets."

The "Ton" referred to above is Zeynep Ton, a business professor at MIT and author of the new book "The Good Jobs Strategy".  In the book (available next week) Ton argues that paying workers more and treating them better is better for the bottom line.  In her research for the book, Ton learned that even low cost retailers can provide good jobs for their employees while keeping costs low for their customers.  In the low cost retail sector, she found that the best employers operated on 4 key principles:

  1. They offered fewer choices to their customers
  2. They cross-trained their employees
  3. They standardize processes while empowering employees to do the right thing for the customer
  4. They "operate with slack"; i.e. they staff at levels that enable employees to spend time with customers

That last item is the one that workforce management software enables, providing employers with accurate data and predictive analytics about the staffing levels required to deliver a great customer experience.

If you're interested in learning more about Zeynep Ton's research:

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