Unity, not uniformity, must be our aim. - MPF
Last summer's stunning protest by thousands of employees at the Market Basket food stores in Massachusetts , New Hampshire and other states was both a major labor action success and an exhibition of innovative worker management cooperation in the face of extraordinary opposition from the Board of Directors. The saga was played out largely in the media and in public demonstrations, including a protest gathering of 6,000 employees one day near company headquarters. It was effective group action.
Mary Parker Follett introduced her concept of the primacy of the group in the wake of the disasters of World War One. Her experience as a social activist allowed her to ultimately be heard by business groups who were interested in her ideas and how they might be applied to the management of employees in a business setting. I believe she would look with favor on the Market Basket story.
The Market Basket dispute involved two groups. One group was the Board of Directors of the company and its voting majority which had fired the CEO of this family-owned company. This majority wanted $250-300 million more in dividends to be voted for stockholders.
While creating his second group, the CEO had survived decades of nasty legal disputes over operations of the company. Initially he had Board support to invent a combination of group attributes in apparent defiance of historical precedent. This second group was a seamless alliance of loyal interests. It was composed of upper and middle managers, include 68 of 71 store managers in the chain ... rank and file employees in the stores, both full-time and part-time employees .... customers ... suppliers ... truck drivers ... families of the employees ... and local politicians who welcomed the service and employment offered by the stores. The CEO, Arthur T. Demoulas cultivated a company culture of everyone believing that the stores were theirs. They were shared.
There were no unions and no rigid barriers between labor and management. In fact, the first labor action taken after the CEO was fired was a half dozen storage managers -- in white shirts and ties -- who went out on a picket line. They were ultimately joined by thousands of other employees. Their primary complaint and their single demand was to bring back their CEO -- Arthur T.. It was hero worship. It was rock star treatment. But everyone had good reasons.
Some motivations were monetary. Good wages, quarterly bonus payments, profit sharing, and scholarships. It was classic "company welfare" at work in the private sector. Aside from the contentious court proceedings, governments had a limited role in the dispute. The Governors of Massachusetts and New Hampshire became involved in seeking a settlement, and they may have helped move the discussion towards the solution : the sale of shares owned by the Board majority, to the purchaser Arthur T. Demoulas for $1.6 billion.
In the aftermath of victory, the CEO was immediately restored to his former position. All the stores that had been shut down were reopened and restocked.
The protests had included both media outreach and a boycott campaign. The boycott became highly effective, with customers staying away in droves, while suppliers refused to truck supplies in. There were empty stores without active employees. By the end of August it was a virtual total shutdown.
The Board majority tried to fire employees, and threatened to force them back to work, but the solidarity was unbroken. The company was losing $10 million a day because revenue had been choked off. The CEO pressed his offer to buy out the half of the store stock he did not own, and with great reluctance the Board finally consented. The capitulation was complete.
The primary outlets for the protest were based on principles of non-violence. There was anger and the appearance of engaging in a war, but civil rights demonstrators in the 1960s (who were pacifists) described their own confrontations as part of a non-violent war. The Market Basket success was born out of the anguish of desperate economic strife.
This commitment to non-violence combined with gritty determination to have an effect led me to draw a connection with Mary Parker Follett's Quaker background, her social work and her horror at the stupidity of the conflict represented by that War to End All Wars. Her introduction to the New State was itself an inventive description of how the group could replace the failed societal structures that brought about the war :
"OUR political life is stagnating, capital and labor are virtually at war, the nations of Europe are at one another's throats because we have not yet learned how to live together. The twentieth century must find a new principle of association. Crowd philosophy, crowd government, crowd patriotism must go. The herd is no longer sufficient to enfold us.
"Group organization is to be the new method in politics, the basis of our future industrial system, the foundation of international order. Group organization will create the new world we are now blindly feeling after, for creative force comes from the group, creative power is evolved through the activity of the group life."
At Market Basket, a seemingly endless legal squabble over control of a family business has resulted in the victory for a new brand of organization which works on loyalty, trust, sharing, and an ending of class barriers. Employees, suppliers, and customers all feel they have a humane stake in the company.
Each week new stories arise about why the solidarity could be achieved. The CEO would greet employees at the meat counters by name, and ask about how their families were doing. He would go to funerals of family members of employees, He would always talk about "our stores" -- not my stores. The very idea of employees putting their livelihood and futures on the line to support a CEO is almost a fantasy, given the predominant greed and cynicism of Wall Street banks and financial institutions.
The latest story is about the man who ran the "We Are Market Basket" protest website. He was actually not a direct employee. He ran a small firm that was one of the suppliers of merchandise to the stores. After the 2008 recession, he got into financial trouble. Arthur T. Demoulas helped him out and got his company back on its feet again. All of these stories tell of the building of loyalty and trust, and illustrate how Demoulas was able to extend the concept of the company group to exclude the Board of Directors but to include a coalition of dedicated soldiers which were more than just the rank-and-file employees of the company.
Already there is discussion about professors at the Harvard Business School having to rewrite their course materials and studies to include the significance of Market Basket. Those professors might do well to read up on Mary Parker Follett too..
Stephen H. Kaiser, PhD