Recently 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.