Tuesday, June 28, 2011

The WSM Employee Action Plan 2011

Well. It's not what I set out in my own suggested Action Plan. And it could definitely do with a little more punch - see my letter below. But you know. For all that. The draft Employee Action Plan, produced by the corporate office of Weaver Street Market Co-operative to address worker grievances, is not half bad.

It's more about setting up pathways of communication and accountability, than actually addressing concerns. But it's a start. Now. A few things have been missed out, and a couple of others need further defining. So. Of course. A letter to the General Manager. But a nice letter. Well. For me:

"Dear Ruffin and Deborah,

I have now had an opportunity to read through the proposed WSM Employee Action Plan. My first reaction is that it offers a very real opportunity to address the grievances raised in the WSM Employee Survey, provided what is suggested is genuine.

That said, I would add that there are one or two important matters missing. But here's the rub. It all comes down to pathways of communication. If you are sincere about opening the pathways of communication, as you appear to be in the Action Plan, then all of those matters can be addressed by employees down the line.

Genuineness of communication will be measured in three ways, in my opinion:

1) The extent to which communication is two-way. None of what you suggest will improve anything if all you allow is communication downward. You don't have to be a rocket scientist to work out that what the Employee Survey was saying, among other things, is that employees are not as happy as they could be because there is not enough communication allowed upwards. We want, we need to be more involved in decision-making. To be allowed input. And to know that our input has had effect. It's not just a question of what would be nice. It's basic Business 101. Employees are more invested in implementing decisions they've been involved in making. More than this, it is required co-op policy under the Board's 'Treatment of Staff.' Which brings me to No. 2.

2) Communication includes accountability - downwards. Just as all of the communication is now downwards, all of the accountability is upwards. This is neither sensible, nor co-operative. Managers and support staff should be just as accountable to those they serve as we employees are to our managers for the jobs we perform. In a co-op, all are equal. We may hold titles, that imbue us with a job description. But different job descriptions do not engender a different status. At the end of the day, when it is time to communicate about our co-op, how it is performing, and to hold people accountable, that communication should be equal. Which brings me to No. 3.

3) Communication (indeed, the Action Plan as a whole) should be about all three of our bottom lines: financial, social and environmental. Again, if this Action Plan is merely another excuse for managers to enforce financial performance, it will fail. We are not just about selling groceries. We are not just about making money. We are about our Mission Statement. We are about our co-op policies. And it is the responsibility of all in our co-op equally to ensure that we meet all three of our bottom lines, not just the financial one. Specifically, it is the responsibility of all of us to ensure that, among other goals, our customers achieve a shopping experience that is fulfilling for them, not just for our financial bottom line. And that all employees enjoy a fulfilling work experience, not just one that satisfies managers and our financial bottom line. If this does not form the context of the increased communication set out in the Employee Action Plan, then we are wasting our time.

Ok. What is missing?

A) Financial Context -- The Employee Survey does not just say that we employees want more communication. The 52 pages of closely-typed commentary set out in statistically significant detail our concerns that we are overworked, overstressed, underpaid, under-equipped and under-supported with the tools we need to serve our customers, and the incentives that should form a part of your wanting us to perform better.

The Employee Action Plan you propose does not directly address these grievances. Why? I'm guessing because that requires money.

We do not need to be rocket scientists to know that the goal you set (not us, you) for us this past year (the 15% sales increase) has not been achieved. We do not need to be rocket scientists to know (notwithstanding the pap in the owner newsletter) that money is still tight. But you do not need to be rocket scientists to understand that you need us happy and fulfilled if we are to produce the results that you want. And that will take money.

The Employee Action Plan should be addressing how we workers can discuss how that money can be made available.

Nowhere in the Employee Action Plan is there any suggestion there will be discussion of our financial state, the gameplan, how to make money available, financial goals for 2012. Now again, if the improved communication you seem to be promoting allows for that, then ... hmm ... ok. But not if managers suppress such discussion in meetings, or say they do not have the appropriate information or personnel available. Um. Let's make sure the appropriate information and personnel are available, ok?

B) Worker-Ownership -- It is no good saying that incentive for financial performance exists for all workers through worker-ownership, if over half of our workers can not afford the $500 induction fee. It is no good saying that the opportunity for input to co-op goal-setting exists through the Election of Worker Directors, if over half of our workers can not afford the $500 necessary to buy a vote.

This point was made expressly clear in the Employee Survey. Could the Employee Action Plan please include the suggestion that worker-ownership will immediately be reduced to, say, $200? Ruffin, you told me there was no good financial reason for keeping worker-ownership so high. You all say you are grateful to us workers for our efforts. Prove it. With this long overdue gesture, and with this whole Employee Action Plan.

Now. To the Action Plan, section by section:

Communications - Departments


All I would repeat are my points above about what can be discussed, communication upwards and accountability downwards.

It is no good one of us raising in a Department Meeting what we are doing within the context of our financial state, if a manager turns around and says, can't discuss that here.

It is no good one of us saying that we are spending too much time focusing on finance and not enough on whether workers are fulfilled in what they are doing (and that is something workers should determine, not you), if a manager turns around and says, um, I have bosses and they won't allow me to allow you to discuss that.

The change in attitude and culture must first take place at the top. You seemed to agree with this at the last SV Unit Meeting. You were all hopping about, talking about improved financial literacy within our co-op. And when I raised the same points I mention here, that a co-op, our co-op is about more than just financial performance, we have a triple bottom line, and we should want to improve co-operative literacy also, you all stood there, nodding your heads vigorously.

Please now turn those nods into action.

Tell your managers that their performance will be judged as much on their compliance with the Mission Statement, co-op policy, and the entirety of the triple bottom line, as it will on achieving financial goals. That they will be perceived to have failed their job description if their employees are unhappy, even if those financial goals have been met.

Communications -- Unit and Co-op Level

Ditto to all of the above.

Again, this is not just communication down. And it is not just financial communication.

I re-iterate, I believe we could improve the Market Messenger, and make it more relevant to employees, and allow them to feel more invested and involved, if we formed an editorial committee of representatives from all Units, and then gave that committee free publishing rights to one page of the Market Messenger.

Subject to exclusion of pornography, what could possibly scare you about such openness (er, a co-operative value to which we subscribe)? Other than the truth?

I would like to see a firm commitment to holding an Annual Meeting of all Co-op Employees, where the primary agenda item would be Q&A with the co-op's senior management.

Equipment Maintenance

Nothing to say, if this actually happens, but thank you.



Consistent Department Standards And Accountability

The Administrative Office is a Department. And it should be accountable to all in the co-op.

Indeed, following on from the enunciation that we are all equal in our co-op, we just have different jobs, we are all equally accountable to each other in our co-op.

The problem is that, at the moment, there is no way for accountability downwards to be enforced.

So. Let's see if we can find a way, starting at the beginning.

Yes, let's set out a clear and consistent job description for all positions. But let's arrange it so that we may all agree on those job descriptions. All of them.

Post them. Have a folder in each Unit, setting out what are the agreed job descriptions and responsibilities of every employee, from the GM down to ... me.

It will come as no surprise to you that I will want to see included in every manager's and support staff member's job description the fact that they are responsible for compliance with the Mission Statement, the triple bottom line, co-op policy and specifically 'Treatment of Staff.'

But how to hold accountable?

Well. First, by holding regular Co-op, Unit and Department Meetings, where it is made clear that discussion of ALL job descriptions, responsibilities and performance will be allowed.

But here's another possibility. By turning the Annual 360 Degree exercise into a rolling Employee Survey. Where we are specifically invited to comment on the performance, not just of our fellow employees, and our immediate manager, but also our Unit Manager, the support staff, the GM, the co-op as a whole, etc.

Let's talk specific examples. We have not achieved your goal of a 15% sales increase. I could discuss the pitfalls of setting unattainable goals. And I probably will in due course. But very definitely, there needs to be an open discussion about whether or not the goal was not met because the much-touted Category Management was a complete disaster, and why.

This raises a point both general and specific. The Administrative Office staff regularly ply us with goals and means and gameplans and the like. But we never, as a co-op, in meetings, out in the open, review the same, discuss whether or not they were properly implemented, and who is to be held accountable. Why not? You do it for me twice a year.

Specifically. Who was responsible for Category Management of the food we produce? And why, at the end of the year, is the food no better, the labeling worse, and the packaging, an obstacle course? I don't want a written answer. I want open discussion and accountability.

And this is just an example. I think we should have the same for lots of other areas of activity we never discuss, like overall financial performance - for starters.

Systems and Processes

I'm not sure what this means. I am going to assume it is a catch-all. And that it will address co-operative, as well as strictly financial, matters.

The only thing I would say in that regard is that, the Intranet is all fine and well. But is there any reason we can not now adopt the Online Forum that was created three years ago, for worker and consumer use, for more general discussion?

Understanding And Achieving Co-op Goals

Make co-op goals more meaningful for workers and consumers, too.

Do this by including them in the formulation of these co-op goals.

Make sure these goals address all three of our bottom lines, along with our Mission Statement and co-op policy.

Then, change this heading to read: "Setting, Understanding and Achieving Co-op Goals."

And then, you'd have my more willing support.

We exist to meet the common needs of our consumers, owners and workers. If we learn anything from all that we are doing by way of surveys at the moment, I hope it is that the only people who can know what are those common needs are consumers, owners and workers.

Don't just ask them what they what, what we want, let us decide for ourselves what we want. That is the co-operative way.

The people who know best if a shopping experience was fulfilling are the consumer and the person who served them. Ask them how it went. Not some third party, unprofessional Mystery Mercenary.

The person who knows best if his or her work experience is fulfilling is that worker. Ask him or her. Listen to what they say. Let them decide how it can be improved. Don't override it. And supplant it with something you read out of a book, or cooked up in the Administrative Offices.

Do this, and the Employee Survey/Action Plan process will mean something. You will make your workers happier. And they will make you happier, when, feeling more invested and involved, they (we) help all of us to achieve all three of our bottom lines.

All the best,

Sunday, June 26, 2011

A Victorian Englishman's Perambulations At The Beach ...

This video has absolutely nothing to do with Weaver Street, other than the fact that I made it while on vacation from WSM, at the beach. We can't all be serious, all of the time. Enjoy ...

Wednesday, June 15, 2011

Now It's Weaver Consumer Woes -- $3 Dividend

In among all the erroneous chatter the Board and corporate office of Weaver Street Market Co-operative are currently sending to consumer-owners about the supposed financial health of WSM, those of you who are consumer-owners will by now have worked out that it is not just the workers of WSM who are suffering financial woes. In contrast to the Board and corporate office's declarations of financial nirvana.

Tucked away at the back of the expensive-looking Board brochure that just thudded its way into your mailbox is the information that, in return for the WSM Board and corporate office taking away your 5% consumer-owner discount two years ago, they have just decided to give you a dividend of - wait for it - $3.

Of course, we are told, the amount of your dividend is as low as it is so that you can further help to build the financial strength of our community co-op. Um. Arrant nonsense.

And that the discount-to-dividend process is a nationwide phenomenon, designed to strengthen co-op's all across the nation by encouraging much-needed loyalty in co-op's. Er. Half true.

The WSM dividend is low in order to help build the strength of WSM? Hmm. The dividend is low:

1) Because we are still paying off $2 million a year on the undemocratically-raised debt, that was used to finance the failed capital expansion of 2007/2008. And, unless consumer-owners use the opportunity of the current feedback exercise to request change, we will be paying off at that rate for the next four years.

I continue to suggest that the sensible way forward is immediately to establish a Board Committee of Owners to undertake a thorough review of the debt, and to make recommendations as to its early disposal.

This would free up $2 million a year, which could then be used to invest in much-needed improvements, reward long-suffering owners with real dividends, and improve the lot of your hard-working, over-stressed workforce.

I first put forward the idea of such a Committee at the Annual Meeting in 2008 (um, we no longer have Annual Meetings; we have 'tables'). The Meeting agreed. The Board and the corporate office then undemocratically overturned the decision of the Annual Meeting of Owners. And here we are. With a $3 dividend.

2) Because the bulk of this year's financial 'profit' is being retained by the WSM corporate office, to build a capital fund, against which more monies will be borrowed (yup - MORE debt), in order to finance unspecified, undiscussed capital projects.

I have suggested that the Capital Plan first be discussed openly. That it should be costed. And that absolutely no funds should be set aside or monies borrowed until owners have approved the Capital Plan, and have given their specific authority to spend monies on it.

As for the claim that WSM is merely following the example of other co-op's around the nation, in changing the discount into a necessarily-smaller dividend, I say, 'almost.'

The concept is one called 'Economic Owner Linkage,' and was devised by a Professor Brett Fairbairn, with whom I have been in correspondence.

Not least when we agreed that Director Elections in a truly open and democratic co-operative are not the be all and end all of democratic expression.

Directors do not have carte blanche to do what they like. Their election represents merely the first step in co-op democracy.

Elections choose the folks we co-operators want to have structure the ongoing democratic conversation within our co-op.

Frankly, there is next to no conversation within our co-op. Conversation suggests two-way, immediate, accountable dialogue, where the outcome is determined by all those taking part in the conversation, not just a corporate office or Board operating a veto at the conclusion of the exercise.

Specifically, it is not one-way 'feedback.' Nor is it a 'Suggestions Box.'

The essence of 'Economic Owner Linkage,' if it is properly implemented, is that it is a deal.

In return for owners agreeing to have the return on their investment based upon the performance of the co-op, the co-op opens up the democratic process, to ensure that owners actually control that performance.

The Board of WSM are well aware of this. They attached Brett's report on the subject to one of their Board Minutes. Is there a consumer-owner out there who feels that, in return for replacing 5% with $3, they got more democratic conversation or more control of the performance of the WSM Board and corporate office?

Well, if you are a consumer-owner who feels that didn't happen, then now is your chance to ask for it.

Complete the WSM Feedback Form. Sigh - it's at least an opportunity to START a conversation.

Would you mind if I had a few suggestions for completing the WSM Survey - which can also be found online?

Question 1 -- Might I suggest that the most important of the proffered suggestions are (excuse the abbreviations): downtowns, food system, worker conditions, and product quality?

Question 2 -- This might be your chance to ask for more democratic control of the performance of WSM, as your promised 'return' on a smaller financial return.

You might want a restoration of Annual Meetings, more elected (as opposed to appointed) Directors, an online discussion forum, or a Consumer-Owner Discussion Group.

Question 3 -- Again, might I suggest the important proffered goals are: survival, savings and debt?

Question 4 -- (a) The Capital Plan first to be submitted to the ownership for approval; (b) Savings to be spent on new capital projects, only after projects are approved by owners; (c) No more long-term borrowing by WSM without the prior approval of owners; (d) A Board Committee of Owners to be established to review the existing long-term debt of $8 million, and to make recommendations for its early disposal; and (e) [This is a weird one; the WSM Survey touts improving worker conditions in Question 1, but not as a financial goal in Question 3; er, how do you improve worker conditions without it being a financial goal? So ... ] Establish a Committee of Worker-Owners immediately to draw up plans for improving worker conditions.

Question 5 -- Up to you!

Question 6 -- Ditto!

Question 7 -- The last few years have seen the WSM corporate office and its Board concentrate power in the hands of a self-selected few. It is time for this to be reversed, so that workers and consumers in our worker-consumer co-op are truly those who democratically control decision-making and performance in our community co-op.

I would suggest you might ask that, once Annual Meetings are restored, motions are allowed. They are not at the moment.

I would also suggest that the Board be stripped of the power it gave itself to change By-Laws without the approval of ownership. That's how $10 million was borrowed without owner knowledge in 2007/2008.

The path to true, sustainable financial health in our community co-op is to abide by the simple truisms that work for successful co-op's all around the country.

Sell what the consumers want, in the way workers want, by putting control in their hands, not in the hands of a self-selected few.

Spend only what you earn. Borrow as little as possible. Do nothing if it does not serve the common needs of your consumers and workers.

And, if you think you may be stepping outside those sustainable limitations, put in place a process that allows you to do so only after the most stringent, democratic and accountable consultation.

Now, try fitting that in the little box provided by the WSM corporate office in their consumer-owner survey ... !!

[This is a re-print of an article first posted on OrangePolitics.]

Friday, June 10, 2011

Letter To CHN Editor -- "Insulting WSM Workers"

Well, I'm pissed all over again. With a WSM Board that has the temerity to tell the public that 98% of WSM workers are happy with WSM. So. A letter to the Editor of the Chapel Hill News:

"Dear Sir,

You will shortly read in the latest newsletter from the Board of Weaver Street Market Co-operative that 98% of the workforce said in the recent Employee Survey that they were happy with WSM.

This is simply not true.

For sure, 98% of us said we love working at WSM. We do. We wouldn't be there otherwise. Specifically, we love co-operative principles.

But what the Board newsletter fails to say is that, along with this bland answer to a bland control question, we workers also provided 72 pages of closely-typed criticism of the leadership of our co-op, and its abandonment of those same principles.

We workers are over-worked, over-stressed, underpaid, under-staffed, under-equipped. We are not properly consulted, nor are we sufficiently included in decision-making.

The Survey results were, in fact, a damning indictment of our co-op's leadership and direction. For the Board to suggest otherwise is dishonest and insulting.

Geoff Gilson
Weaver Street Worker Advocate"


The Chapel Hill News very kindly published my letter.

WSM To Borrow More Money -- Really ... ?!?

I have decided to set out in full my post on OrangePolitics in response to the latest WSM Board missive. Why? Because our Board Chair takes it upon himself, in that missive, in advance of worker discussions on Employee Action Plans, to tell the world that we workers are 98% happy with everything to do with WSM.

I was really, really, really hoping that the WSM corporate office had not asked that question in the WSM Employee Survey so that they could then dishonestly use the answer to pretend to the world that all was well with the lot of workers in WSM. The WSM corporate office have proven, once again, that they are creative only to the extent of dreaming up new levels to which to sink.

My post:

The Board of WSM are inviting feedback from owners on the WSM financial results for 2011, the financial priorities for 2012, and the manner in which the patronage dividend will (may?) be apportioned.

The Board Chair's report on the state of WSM's finances for FY 2011 is a re-hash of all that has been covered in the previous comments in this thread. He claims WSM has returned to financial health. I truly wish that were true.

The fact is, however, that our profit is lower than last year, and has been achieved by making exploitative demands of already hurting workers.

Frankly, the most galling reference by the Board Chair is to an unrepresentative answer in the recent Employee Survey. That reference suggests that the employees of your community co-op are totally happy with their lot.

The Board Chair (himself a worker-owner, who works in the WSM corporate office) is fully aware that the results of that Survey were a resounding vote of no confidence in the leadership of our co-op.

For sure, we said we like working at WSM. Of course we do. Otherwise we wouldn’t be here. More to the point. We ARE here precisely because we do believe in the principles of co-operation.

The Board Chair fails to reference the pages and pages and pages of very specific, detailed and comprehensive commentary, offered by a statistically significant proportion of the workforce, which commentary states quite baldly that we workers are hugely disappointed that our leadership has simply set aside any pretence of being a co-op, and of complying with the co-op’s Mission Statement that demands that employees enjoy a fulfilling work experience.

We love working in our co-op. But we are very unhappy with the co-op’s leadership.

The Board Chair knows that, and dishonestly chooses to mislead consumer-owners into thinking we workers are happy with everything.

The fact is that the recent Employee Survey reported that workers feel overworked, overstressed, underpaid, understaffed, under-equipped and unhappy with the lack of communication from the WSM corporate office, and dissatisfied with the lack of inclusion in decision-making in a co-op they are told they half-own.

But the package of information that the Board has released gets worse.

You see, we employees are currently engaged in a process of abbreviated discussion about addressing the grievances we raised in response to the Employee Survey.

That discussion is supposed to lead to a specific round of discussions on Employee Action Plans to address worker grievances.

Indeed, I was approached by the corporate office, and specifically asked not to write publicly about that process while it was underway.

The ostensible reason given was to encourage discussion, without employees feeling their remarks might be published. So, I agreed.

We can now see that the real reason was to allow the WSM corporate office dishonestly to pretend to the outside world that all was well with our community co-op’s workforce.

The point is that those grievances will require funds to address. We workers rightfully feel that, having made huge sacrifices over the past few years, in order to bring our co-op back to some sort of health, it was time finally to address our work conditions, to bring them back to what they were – or better, as a sort of reward.

After all, we make the money that keeps the co-op afloat. Why should we not share in the product of our efforts?

Yet, before our discussions on Employee Action Plans are even begun, let alone concluded, we are told in the current Board missive that the Board and WSM corporate office have dreamed up a whole new 10-year Capital Plan, and it is THAT Capital Plan which will receive priority in funding.


We workers were denied a dividend for three years. We were denied pay raises for two years. We have received paltry pay raises since then. All to help the co-op stave off bankruptcy.

We have agreed to work longer hours. We agreed to bust butt this past year to try to increase sales by 15%. We are over-worked, over-stressed and under-compensated. We work harder now than we did several years ago, for less. All to help pay off a debt of $8 million, which was borrowed without the approval of owners or workers, to fund the last disastrous capital expansion plan.

We have not yet paid off that debt. No doubt further exploitative demands will be made of us next year, since we did not achieve the 15% goal this year. Our own grievances and demand for better conditions are being shunted to one side.

And all the while, the Board and WSM corporate office, in secret, are devising yet more capital plans? Which will require more borrowing? Which we workers will have to repay by working even harder?

Again. Enough.

My fellow workers and I will be doing what we can in our meetings to try to stop this nonsense. But we can not do it on our own. We need the support of consumer-owners when they provide the feedback the Board is currently requesting.

But before we get to that suggested feedback, you may well be asking yourselves, how did all this happen without our knowing? Well, I could say because you good folks weren't paying attention. But that wouldn’t strictly speaking be fair.

You see. The Board decided last year not to hold an Annual Meeting. But how, you might further ask, could they do that without a change in the By-Laws? Because the Board has given to itself the sole power to change the By-Laws, without a vote of owners. And how did this happen? Er, cf. paying attention ...

Ok, so there is this Capital Plan. Which was developed undemocratically. How bad can it be? I don't know. The Board aren’t publishing it as part of their feedback exercise. They want you to agree to it blind.

Hmm. But what is all this I say about new borrowing? Well, that’s where the Board’s plans for the patronage dividend come in.

Consumer-owners will receive 20% of the dividend apportioned to them. The remaining 80% will be put into a capital fund (consumer-owners will never see it again). And we are told the capital fund will be used to make capital improvements.

Well, you say, that makes sense. Well, it would, if it were true, and if the capital projects were being approved by the workers and consumers in our worker-consumer co-op.

But the Capital Plan of projects has already been agreed, without our approval, and again, it is not being published.

But worse. The fund money itself will not be used to finance the capital projects. Oh no. The fund will simply be used as collateral to BORROW more money (perhaps three or five times the amount of the fund). Each year.

And we workers will once again be the ones having to shoulder the sole burden of paying off the debt and the interest. Which we are doing at the moment, to the tune of $2 million a year, on the still existing $8 million debt.

Yes. You're reading that right. Even after the debacle of the store expansion in 2007/2008, which nearly bankrupted our co-op. When we still have $8 million of debt to erase. When the only plan so to do is to make the overworked workers work ever harder. Yes. We are planning to fund yet more unknown capital spending with new borrowing.

But how, once more you ask, how could the Board possibly get the authority to borrow more money? We, the owners, would stop them. Think again. The Board changed the By-Laws to give them sole and absolute authority to borrow whatever capital monies they need.

All of this has been going on and continues because you good folks do not put down your foot. What can you do? Put down your foot. And save our co-op. Provide feedback to the Board.

Oh. And in case you were thinking that there might be meetings, at which you would be able to hold the co-op leadership publicly accountable, think again. There will be tables. Where you can have a chat with one or two folks. Away from the glare of any transparency or openness.

I would respectfully suggest that you might want to consider the following as a response to the Board missive:

1) Shop more at WSM. And take more of an active role in the co-op. So that plans like this are not just dumped on you.

2) Take part in the current feedback exercise. Write to: board@weaverstreetmarket.coop. Please don't let important decisions about our community co-op be taken by a self-selected few just because you allow them to do so by default.

3) Ask that that the first financial priority for 2012 be a sustainable profit, and an immediate plan to eliminate the existing $8 million debt – a plan that does not impose further burden on your long-suffering workforce.

4) Ask that the second financial priority be an improvement in the condition of workers to be agreed with the workers.

5) Ask that the third financial priority be that no Capital Plan be implemented until it has been agreed by workers and consumers, and simply refuse to allow 80% of your patronage dividend to be retained until such consent has been given.

6) Ask that the fourth financial priority be an absolute moratorium on any and all spending on or borrowing for the Capital Plan until such time as the current debt has been eliminated in full; consultation has concluded on the Capital Plan; and the grievances of the workforce have been addressed.

I too believe that our community can only benefit by having a thriving, sustainable co-op. I too believe that it requires a sound capital base. But I also believe that our community worker-consumer co-op can only thrive when it has a happy workforce, and a consumer base that is respected and included in important decision-making.

We are a co-op for a reason. And that is because we expect more of ourselves than to be thinking merely of making money. We are supposed also to be thinking of the social impact of our business on our owners, consumer and our workers. That is why we pride ourselves on having a triple bottom line: social and environmental, as well as financial.

It is time to take as much care of the social and environmental bottom lines as we do the financial. Either we have the funds to do so, or our Board should not be sending out missives saying we have returned to financial health.

Please provide the Board with your feedback. And when you think of borrowing, please be thinking only of 'borrowing' my suggested financial priorities for FY 2012 … !!

Saturday, June 4, 2011

Will New WSM Finance Manager Impact Employee Action Plans?

Weaver Street Market Co-operative is about to hire a new Finance Manager, weeks before the end of a controversial Financial Year. Is this a reflection of the state of WSM's finances? And is that the reason for the WSM corporate office attempting to finalize Employee Actions Plans before the end of the Financial Year (June 2011)?

I have today written to the WSM General Manager (I thought I had left this behind - sigh), to ask him these questions, and to ask for assurance that Employee Action Plans will be agreed consensually (without a veto from the center), and that they will be allowed to address steps to improve the financial state of WSM.

We are all equal in this co-op. We may assign ourselves different titles. But those pertain only to the jobs we have been asked to perform. They do not confer a primacy of authority, nor a supremacy of viewpoint, on any individual or small group of stakeholders, such that it interferes with that co-operative equality.

It is my belief that we find ourselves in less than happy financial circumstances today, with our employees expressing overwhelming unhappiness with the senior management of our co-op, precisely because we have drifted away from that essential co-operative principle of equality.

I believe happier times lie ahead if we use the opportunity of these Employee Action Plans consensually to agree a way forward, to which we all subscribe and in which we are all invested - equally.

My letter to the General Manager, Ruffin Slater:

Dear Ruffin,

I am a little disturbed to see that we are now looking for a new Finance Manager. I'm wondering if this is, in any way, a reflection of the state of the finances of WSM, as we approach the end of the Financial Year, and whether the latter or the former will have any impact on the formulation of the Employee Action Plans?

It may well be that this has nothing to do with policy, and is simply a personal matter. In which case, it is none of my business. And I wish Tim well. But, if it is a reflection of or could have impact upon the state of WSM's finances, then this is a concern for all employees, and I would suggest that we need to know, before we begin discussion of the Employee Action Plans (EAP's).

I'm bound to say I have noticed that there is something of an all-fired rush to get the EAP's concluded before the end of the Financial Year. I'm hoping this is merely a co-incidence, and has nothing to do with what might be announced as the final results for the Financial Year, and any consequential action that may need to taken.

I, for one, regard the state of WSM's finances as an important context for discussing the EAP's, not least because those EAP's may have to address that financial state, and/or be affected by it. I do not think it would be appropriate to regard the two as separate. I would be unhappy to conclude discussion about the EAP's, only then, at our Unit Meetings in September, to be presented, without discussion, with a whole new barrage of financial objectives, which do not mesh with the new EAP's.

It could be said I am getting this all out of context and out of proportion. But let's just look at this past Financial Year, as it comes to a close.

Amid great fanfare, but next to no consultation, the WSM Admin. Office Management (AOM) presented to each Unit at the end of last year a draconian target of increasing sales this Financial Year by 15%. Next to no reason was given. I had to begin a Dispute Resolution Process to find myself having a meeting with you, to get some sort of information about why the need for a 15% sales increase. I also met with Tim. And by the way, I am still waiting to see a copy of the official Audited Accounts For WSM for the last Financial Year.

I was attempting at our meeting to provide positive feedback, almost none of which has been acted upon. Like, for example, devoting one edition of the Market Messenger, not to telling us workers what you wanted out of us, but rather what we would get in return, for providing what you wanted out of us. Never happened. And this sort of non-communication and non-interaction may well explain the rather dismal feedback to the WSM Employee Survey.

As a consequence of that positive approach, I did not attempt to pick holes in the rationale which you advanced. Which, essentially, was that we needed to increase sales by 15%, to raise $3.75 million, so that all of those extra sales could disappear into the cost of making those extra sales, solely to increase profit by a paltry $150,000.

As I say, I wanted to provide positive input at that meeting. So, I did not spend time making the obvious point that this rationale was nonsense, and that it was clear to me, and most of the shopfloor workers to whom I had spoken, that the extra money was primarily to start paying off the overall WSM debt of $8 million. On the basis that you have said this debt will be paid back in 5 years, that means that (including annual bank interest), the amount to be paid this Financial Year would be about $2 million.

Frankly, the disposition of that $3.75 million makes a lot more sense when it breaks down (roughly) into: $2 million for debt; $1.5 million for cost of extra sales; the remainder = extra profit.

I have made and continue to make the point that, whatever the financial rationale for the 15% sales increase, it was an unrealistic target (and you don't set unrealistic targets in sound businesses), and it would impose yet further unwarranted, unexplained and unnecessary burden on the workforce. Both predictions have proven true.

During the Grand Presentations to the Units last Fall, detailed plans were submitted as to how the co-op was going to be turned upside down in a no-holds-barred effort to achieve the 15% sales increase target.

Category Management in the Food House. Revamped Merchandising efforts. Marketing up the wazoo.

However, within months of the Unit Meetings, our Head of Merchandising, the lady tasked with both the Merchandising efforts and the Category Management project, left to start a restaurant. Later in the year, the Executive Chef and Kitchen Manager in the Food House also departed (after only just over a year with us). And now, the Finance Manager (who has also been with us for only just over a year), the guy who must have been overseeing all of this effort, is on his way out.

This can not all be co-incidence. So, no. I do not think I am over-reacting. Especially, when I review the consequences.

Food quality and service has gone down, not up, this past year. Not the fault of the shopfloor/Food House 'floor' workers. We all work as hard as we can. The fault of a lack of proper direction. And how could there be proper direction, with all the musical chairs taking place with the senior management responsible for implementing the efforts to achieve that 15% sales increase?

So, as we approach the last few weeks of this Financial Year, notwithstanding the sterling efforts of all the shopfloor workers throughout WSM, Q1 and Q2 saw sales increases of only 9%. And since then, it has got worse. Q3 = 8%. And Q4 is heading for 7%.

This will leave us about $2 million shy of the sales target, on a projected annual turnover for this Financial Year of some $28 million. Ironically, and possibly unhappily, almost the same amount we need to be finding to keep the banks at bay.

Clearly, there will be consequence. And it will be consequence that I trust will be explained fully and addressed during the formulation and discussion of EAP's.

Meanwhile, and not surprisingly, the overwhelming message from the Employee Survey is that employees are reasonably happy with what is happening in their Departments and Units, but are not happy at all with what is coming from the center.

They are not happy with decisions that have placed and continue to place upon them an intolerable financial burden, for reasons that are not properly explained, as a result of deciion-making in which they are not involved, and which leaves us overworked, overstressed, underpaid, and without the proper resources to provide to our customers the service with which we wish to provide them.

If the EAP's are to be a meaningful consequence of the process which the center volunteered, then they must address the state of our finances, how to improve them, how to create the space to find the resources then to deal with the lack of inclusion, lack of communication, lack of staff, lack of return, and lack of proper equipment. And finally, they have to deal with the distrust of employees with the center.

A distrust that was underlined by the response of the Admin. Office staff itself in the Survey -- a resounding vote of no confidence in the ability of Admin. Office management to provide future direction for the co-op on its own.

Hardly surprising, bearing in mind the disaster that has been the centrally-misdirected effort to increase sales by 15% this past year - and quite leaving aside the other central mishaps of the past few years. The bottom line is that the co-op as a whole no longer has confidence in the center to give direction on its own.

I have set out elsewhere that I believe the response in the EAP's should be to streamline the Admin. Office functions; devolve authority to the Departments and Units; and make what remains of decision-making in the Admin. Office more inclusive of the co-op's workers and better explained.

Of course, that can only happen if the appropriate management and Admin. Office personnel are present at those EAP discussion meetings. I was concerned that there was little (if any) management or Admin. Office personnel involvement in the discussion of the Survey's results. I trust that will not be the case during the discussion of EAP's.

We face a dire financial situation. It needs explaining to us, as we formulate the EAP's. Otherwise, those EAP's will be redundant before the ink is dry. That explaining needs to be done by the appropriate personnel. It's called accountability. And then, consequential action (the EAP's) need to be agreed consensually.

The state of our finances, the lack of confidence demonstrated by the Admin. Office employees in their own management, and the distrust expressed by employees throughout our co-op in the center is nothing if not eloquent testament to the failure of centralized and isolated decision-making, and a clarion call for more inclusion and consensuality in making decisions in the future - beginning with the EAP's.

There is no-one in this co-op, no one individual nor a small minority, who may operate a veto on the EAP's. We are all equal. We are seeing now, at the end of this Financial Year, in the results of the Employee Survey, what are the consequences of our having moved away from that notion of equality these past few years. It is time to move back to co-operative values and principles.

The reason for finding a new Finance Manager may not be something that needs to be explained to me or other employees. But what we should be able to expect is a full explanation of whether or not it is a reflection of the state of our finances, and what consequence that state will have on planning. In particular, we should expect to have that full explanation before formulating the EAP's, and we should expect that those EAP's will creatively address the state of our finances and the unhappiness of our employees.

Otherwise, we will merely be repeating the mistakes that brought us here. And we will be demonstrating the truth of what the Admin. Office employees themselves stated in the Survey: WSM does not encourage new ideas, nor does it support constant improvement. I trust this will not be the case.

All the best,