Monday, April 28, 2014

New Web-Site A-Coming

Well. I learn that there is a new web-site in the works. Yay. Lots going on. Need to communicate about it. Yay. Might be some blogs. Yay. Bit of an argument about whether there will be full commentary allowed in connection with said blogs. Huh? Any chance of an online forum? Er. What about ...

Hang on, hang on. Forget what I think. What I might want. What is even more important than that? Anyone? Anyone? Bueller? C'mon. All together. Are we owners and workers going to be given an opportunity to provide input on the web-site design, interactivity and content?

And so. You guessed it:

"Hey Ruffin,

[Little intro] ... One of the things I think is of paramount importance (once again!) is that owners, consumers and employees have an opportunity to be included in the decision-making process that designs the finished product [the web-site]. I'm wondering if there are plans to allow us to see the beta site, its content and to comment on both before final decisions are made?

All the best,

Alright. Now I'll do some commenting. I get that the folks in the WSM corporate office management team might well want this web-site up and running in time for the Annual Meeting. But that should not preclude owners and workers being involved in commenting on the design.

Now, maybe this is already in the works, In which case, yippee. We'll see.

My only other comment is that I would love to see an online forum. We were discussing this back in 2008. At the very least, I hope there will be full commentary and immediate feedback permitted on the blogs. Otherwise, what's the point? We just end up with yet more one-way communication.

Friday, April 25, 2014

What Happens To WSM Profit?

As promised yesterday
, I have written to the WSM General Manager, asking if he intends to comply with co-op policy regarding disposition of any WSM profit this financial year:

"Hey Ruffin,

The guidelines agreed by the workforce in 2007 to cover when employees should be included in the decision-making process specifically identify setting the worker-owner dividend (and by extension, what should be done with WSM profit). Will that be happening this year, and if so, how?

All the best,

We'll see ...

Thursday, April 24, 2014

Are We Running A Loss, Or Not?

Does it matter? Well, aside from the obvious answer – duh. It matters on a more complex level.

You see, senior management within Weaver Street Market Co-operative perennially argue against those of us requesting that we actually behave like a socially-minded co-op by saying, well, we need to be a good business first.

In other words, we are told to trust them to make good business decisions, so that we then have the space to ‘play’ at being a good co-op.

Which is all fine and dandy provided (1) They are making good business decisions, and (2) We do then get to ‘play’ at being a good co-op.

But what if all the evidence suggests they are making bad business decisions, leading to us running a loss or a tight profit, leaving us no space to be a good co-op?

I would say that requires that we demand they be accountable to us (the workers and owners), so that we can ensure that they make better decisions.

Which is essentially what I try to do. By banging on the table. And making noise. Er … cf. this co-op blog.

Now, I shouldn’t have to be banging on the table (quite so much), since (A) The Board of Directors exists to hold management accountable (um … but the Board, in my opinion, isn’t doing its job), and (B) There is a co-op policy that demands that management include employees in all major decision-making (which they haven’t been doing).

All of which neatly brings me to today’s employee Market Messenger, which is twice as big as usual, in order to communicate a lot of news.

Bottom line: we’re running a tighter profit than last year; (because) senior management have been making bad decisions; they are, however, starting to include us in decision-making (cf. noise, maybe?); and we have an opportunity to start changing Board membership.

So. A mixed bag. Let’s get to the nitty-gritty:

PAGE ONE – Sigh. The WSM corporate office management team try to blind-side us with a whole page telling us we’ve made better sales figures in the past three weeks than we’ve ever made before.

Double sigh. Without mentioning the price increases of the past year. And without highlighting the fact that sales figures count for nothing, without reference to profit margin. We can sell a gazillion pineapples, at a loss, and go out of business (cf. Panzanella).

I'm not being idly tendentious. Over the past month senior management have been running a somewhat controversial deep-discount program called WOW, which by their own admission has "sacrifice(d) most of the profit."

So, we move onto …

PAGE TWO – Where we are informed (in the Third Quarter financials) that our profit to date is roughly $50,000. Last year, it was running at $220,000. So, down on last year. And not because we workers haven’t been busting ass!

Excuses are made that Carrboro store sales were down due to the store closing for the store Refit. Without mentioning the fact that the store did not fully close. Nor the fact that a lot of folks went to the other stores instead. Nor the fact that a lot of customers simply didn’t like the way the Refit ended up looking (cf. did we use acknowledged outside experts; or (treble sigh) did we rely on the ‘inhouse’ experts, again?).

What is also not set out is the budget for the Carrboro Refit. The fact that the Refit overran schedule and budget. How this contributed to the lower overall profit figure. And the fact that all this is about spending, not sales. And that makes it the responsibility of senior management.

Here is where it gets murky. And to be honest, the senior management of WSM are pretty good at murk. Quadruple sigh.

They get all happy-clappy about sales. But the figures themselves say quite clearly that we are way off budget on margin. No doubt because we’ve been running those ridiculous discounts (more on that a little later). Which I say we probably have been running in order to raise cash. To cover the fact that senior management made a bit of a Horlicks (English expression!) of the Refit. And don’t want to admit it.

And it doesn’t end there. Because there are still two major aspects of the Refit which senior management completely overlooked, which they themselves have now finally admitted, and which could cost in the hundreds of thousands of dollars. I don't know for sure. They don't tell us that much.

That part of the Refit has been postponed until the next financial year, so as not to cause a loss in the current financial year. Which is why I ask the question, are we actually running a loss, or not?

Still with me? If not. Don’t blame me. Blame the murk.

So. Quick recap before we move on. WSM employees doing a brilliant job producing lovely food and selling the bejesus out of it. Yay for us!

Senior management doing a pretty crap job of wisely spending the money we sweat to earn.

They’re trying to cover that up. One of them (no names) bluntly told me in the past few weeks that there had been no overrun on the Carrboro Refit, and that the overrun had had no deleterious effect on our overall finances. Hmm.

[And I hasten to add, as I have done before, that I fully support the Carrboro Refit; long overdue; I just wish senior WSM management would stop thinking they are experts at capital projects, and then screwing them up.]

Who knows where this will leave us at the end of the 2014 financial year. What I do know is that I may well ask some pointed questions at the Annual Meeting this year. Which is a good thing. Senior management forget that the Annual Meeting is a part of the governance process, and not just a meet ‘n greet.

The other good news is this: if we remain on course to make the end-of-year profit senior management are predicting (some $500,000 – last year we made $830,000), then (good news) co-op policy demands that workers be involved in the decision as to what should be done with that profit. A fact which I will be bringing to the attention of our General Manager, in another of the e-mails he loves receiving from me.

In the meantime, some kudos to senior management for at least sharing some financial news. Even if it only followed my bellowing at them for a while.

And even if it does confirm what I have been wondering aloud since Christmas. Namely, that the Carrboro Refit ran into problems; those problems have been seriously impacting our financial picture; senior management didn't want to admit the problems or the impact; so, they have been taking steps to 'rectify' the impact, without consulting owners and workers; and that 'rectification' (deep-discount sales?), while producing immediate cash (record sales in the last three weeks - $300,000 up on same three week period last year), may be having an even more deleterious effect upon our overall profit ("sacrifice most of profit").

PAGE THREE and FOUR – I’m going quickly to skip ahead. These two pages set out at enormous length what we have been doing with our new WOW Weekend Special Discount Sales, introduced just this past month.

Now, I know I wrote a couple of e-mails to our Merchandising Manager, James Watts. Along the lines of, what the heck is this all about? But I’m sure other folks had questions too. So, I don’t think I’m the sole reason for all this information.

But. Please note. We ARE getting all this information, for which I and others had been asking. AND. Get this. They (senior management) are finally asking us formally what we think. We are (finally) being included in at least some of the decision-making process. So, kudos to senior management again. Although, I think I am allowed to take a teeny-weeny bit of the credit.

I’m not going to comment at length on what James has set out. I’m only going to say this: I don’t care what he says; it’s screwing up margins; our figures prove that; it’s affecting our profit; there still seems to be no simple rhyme or reason; the marketing logic offered is nonsense; it just seems to be a glorified and misguided exercise to get a hold of cash. But I’ll leave you to make those comments …

… which you are able to provide, ‘cos they have actually asked us for our opinion!!

Which is the very essence of accountability. Putting senior management to the trouble of explaining what they are doing. So we can see nonsense for what it is. Bad decisions for what they are. And we can be involved in the process of designing a better future for ourselves, both as a business, and as a co-op.

But, but, none of this is about creating space to discuss how we can be a better co-op. Aha! Back to PAGE TWO …

… where the Market Messenger announces the annual call for Candidates to run for the WSM Board of Directors.

It is my opinion that the primary responsibility of the Board is to ensure that workers and owners are involved in the decision-making process that designs the character of our co-op, and sets business and co-operative goals for our future.

For one reason or another, I think the current Board is failing in that responsibility.

I have attended Board Meetings on and off for nine years now. Increasingly, the Board has allowed itself to be marginalized into becoming and acting as nothing more than a benign advisory committee.

When, in fact, it should be vigorously monitoring WSM senior management, to ensure it is complying with co-op policy and making good business decisions.

I already have my Candidate Packet. And one way or another I will do all that I can to ensure that there is at least one Candidate for worker-owner Board Director who truly represents workers in our co-op, and who has the best chance of gaining victory against the Candidate management have perennially recruited themselves every year since 2007.

In the meantime, if you are not already a worker-owner, become one now, by contacting Brenda Camp (Owner Services Co-ordinator) at

It costs only $3.85 a paycheck. You will build up dollars for your annual dividend (probably not until next year now). And. You will get to vote in the Board Election this year (August-September), and help to choose a worker-owner Board Director who will advocate vigorously for worker and owner rights, and who will work to create the space where all of us can discuss how we can be a stronger business and a better co-op.

[As always, WSM Employee Policy demands that I make it clear that these are my personal views. I will just add that, if you've got as far as reading this caveat, you deserve a drink or three ... !!]

Tuesday, April 15, 2014

The Democratization of Decision-Making

What does it all mean, Geoff? What do you keep bleating on about? Well, what I want, in a nutshell, is for my very favorite co-op to comply with the precepts of co-operation and, indeed, with its own stated policy, and make decision-making in our co-op more democratic by involving owners and workers in the making of the important decisions.

And here’s the thing. As this linked article from the London Guardian newspaper makes clear (in 2008), this isn’t some pie-in-the-sky weirdo hippy freak utopia; even corporatist businesses are beginning to understand that, if you engage owners and workers in important decision-making, this makes them more invested in the successful implementation of the decisions. Kind of makes curious sense, doesn’t it?

But in a co-op, democratization of decision-making isn’t just some cute idea to make us more productive. It is the very essence of our business model. What sets us apart from corporatist commercial entities. It is the bedrock of the International Co-operative Alliance definition of co-operation (which WSM merrily quotes all over our co-op web-site), namely that we are only a co-op if we are democratically-controlled by our owners, both worker-owners and consumer-owners.

And here’s the thing. The definition doesn’t stop at ‘democratically-owned.’ It says ‘democratically-controlled.’ And not democratically controlled by just a few owners (say, the ones in our corporate office management team). No. All owners. And not just the Board. It doesn’t say ‘democratically-controlled by representatives.’ It says. Sigh. ‘Democratically-controlled.’

But there’s more. In the case of workers, we actually have an Employee Policy which states very clearly that we get to be democratically involved as the decisions are being made.

There has been some confusion about this. Let me clear it up. Find a copy of the Employee Policy Handbook. First page. At the bottom. Board Policy: ‘Treatment of Staff.’ It states:

“With respect to treatment of paid and volunteer staff, the general manager … may not:

4) For paid staff, cause or allow a decision-making standard that is not transparent or does not allow for opportunity to participate in decisions and shape the guidelines for decisions.”

That’s it. It’s as simple as that. We workers are supposed to be involved in decision-making. Not told about it afterwards, not asked for our comments, but involved in the making of the decisions themselves.

That’s what makes us Weaver Street Market Co-operative, half-owned by its workers, who are supposed to be directly involved in decision-making.

And not WalMart Corporation, owned by a few, who make the decisions without any reference to their workers at all.

Yeah, yeah. Ok. Big deal. So, I get to choose the color of Ruffin’s drapes. But who cares? Why should I want to?

Well, it’s a bit more than choosing the curtains. We are supposed to be directly involved in making decisions, for example, about where we are heading. How projects are undertaken. What we do when they go wrong. In fact, the whole point of being involved is to try to prevent them going wrong.

Like that happens. Er. Yes, it does. It is happening right now. Did you feel involved in the decision-making that set our goals for the next ten years (‘Vision 2020’)? Were you involved in the decision to raise our department margins by 50%? Do you even know why that happened? Who made the decision about Panzanella? You?

And here’s the one that’s most relevant. First, a quick caveat. I am beyond delighted that my mates in Carrboro are finally getting their long-overdue store refit. If there had been an opportunity to have a vote on that project, my hand would have been the one highest in the air.

But. It became obvious that, as the project was underway, things were not going as the few in the corporate office had planned (on their own – yes, I’m making the point). How did we know? Well, not because we were told (heaven forbid). But because some of us ain’t stupid, and we saw the signs.

I made some … um … gentle yet insistent enquiries (hey, I’m a pussycat!). And the answer was that nothing was wrong. The last employee Market Messenger makes clear this is not the case at all. There were two huge matters that had been completely overlooked. And which will now involve more work, more expense, and likely more interference with normal store operations.

This is not the first time this has happened. It happens all the time. It happened with the last exercise in capital projects, back in 2008, when we built the Hillsborough store and the Food House. And the miscalculations by a few put us $10 million in debt – a debt which is still $7 million, and which costs us $500,000 in bank interest payments each year.

WSM and the money that we workers make with the sweat of our brow is not some convenient piggy bank for a few somewhere to spend or misspend on whatever takes their fancy.

We are a co-operative, where all are equal, where we choose to entrust a few with making decisions that are supposed wisely to husband our funds. And. The policy that demands that we workers be involved in the decision-making that spends our money, that rectifies mistakes and holds accountable those who made the mistakes. That policy is our safeguard that the entrusted few behave themselves.

When we, each one of us, not just me, when we insist on compliance with that policy, we act to ensure that these cock-ups do not occur. That is why I keep bleating on about the democratization of decision-making. It involves us. And it protects us.

Oh, and when you check up on Employee Policy, in that same section ‘Treatment of Staff,’ you will find the policy statement that we workers are allowed (without retaliation) to report to the Board of Directors whenever management are not in compliance with the policy that demands they include us in decision-making. Which policy (reporting management - you can find the specifics of how in Section 5.J) I have been merrily employing these past few months – and

And you know, I don’t have to be the only one. You can do this too. At the very least, why not vote for a candidate in the autumn election for a Worker-Owner Board Director who actually states baldly that he or she will enforce democratization of decision-making in our co-op?

In the meantime, after some more gentle head-bangi … I’m sorry, I misspoke, after some more gentle encouragement, I have been told that in the next few weeks we will see the figures for the end of the Third Quarter. I have specifically asked that those figures address the true financial situation within our co-op, including that relating to the Carrboro Refit overrun.

And again, let me make this clear. I want the very best for my Carrboro friends. But I want US to be making the decisions about how we deal with the overrun. Not just the few who made the errors of judgment in the first place.

In which regard, I have also asked that, if there are decisions that need to be made arising out of our current financial situation, we workers start to be involved in the making of them. We’ll see.

Oh. And two final heads-up:

1) You won’t see that Carrboro Refit overrun in the 3Q figures. Nor in the 2014 Annual Report. All further Refit overrun work has been postponed until after June. June is the end of the 2014 Financial Year. So, the overrun has been postponed until the 2015 Financial Year. Clever, eh?

2) If 3Q reports a truly healthy profit on the way, remember this, the Employee Policy on inclusion in decision-making specifically states that workers should be involved in the decisions about what WSM does with its profit.

Bet you didn’t know that, did ya … ?

Thursday, April 10, 2014

Elections In Our Co-operative

In 2008, I had the good fortune to serve with an engaged, lively and intelligent group of WSM owners on the WSM Elections Task Force, whose remit was to design rules for elections to the WSM of Directors, and more widely, to explore what could be done to increase owner involvement in democracy within WSM. That work is now carried forward by the WSM Elections Committee.

At the beginning of May, that Committee will issue a formal call for candidates for the election in 2014 of one Consumer-Owner Director and one Worker-Owner Director to the WSM Board. A good time to reflect on co-operation, democracy and elections within WSM.

I submitted a document to the Task Force at the beginning of its deliberations with some thoughts of my own. I think the Introduction ('What is a Co-operative?') is as relevant today as it was then, in terms of wondering what sort of co-op WSM is, and how we would like to see elections, democracy and decision-making operate within WSM.

The full document can be found here. As to its title, ah, you had to be there!!

The full discussions of the Task Force are minuted here. Yup, those Notes from an Individual would have been from me.

I am especially happy I took the time to submit the first Note. It set out how I believed the Task Force should operate in terms of openness, transparency and inclusivity.

To a very great extent, we succeeded in the latter regard. And I think the template that we established continues to serve as an excellent example of how our co-op should operate, when doing so at its best. Whether it is operations, the corporate office management team, the Board or the standing Elections Committee.